• Kearny Financial Corp. Announces First Quarter Fiscal 2023 Results and Declaration of Cash Dividend

    Источник: Nasdaq GlobeNewswire / 27 окт 2022 07:30:01   America/Chicago

    FAIRFIELD, N.J., Oct. 27, 2022 (GLOBE NEWSWIRE) -- Kearny Financial Corp. (NASDAQ GS: KRNY) (the “Company”), the holding company of Kearny Bank (the “Bank”), reported net income for the quarter ended September 30, 2022 of $16.5 million, or $0.25 per diluted share, compared to $11.4 million, or $0.17 per diluted share, for the quarter ended June 30, 2022.

    The Company also announced that its Board of Directors has declared a quarterly cash dividend of $0.11 per share, payable on November 23, 2022 to stockholders of record as of November 9, 2022.

    Craig L. Montanaro, President and Chief Executive Officer, commented, “Despite pressure on net interest margin, attributable to the rapidly rising interest rate environment, we delivered impressive results for the quarter. Growth in loans and deposits remained strong, expenses were well controlled and asset quality metrics notably improved. Over the past two quarters, our loan portfolio has grown at a 26% annualized rate, driven by strong origination volume and slowing prepayment activity. Looking ahead to the remainder of fiscal 2023, we expect loan growth to moderate, as we have right-sized our loan pipeline and are focusing our origination efforts on those loan segments which provide the greatest risk-adjusted returns.”

    Mr. Montanaro further noted, “In recognition of the risks presented by the prevailing economic and interest rate environment we continue to position our balance sheet to support net interest income, and margin, in a variety of interest rate scenarios. To that end we have, since the start of this fiscal year, added $600 million of derivative notional and made targeted adjustments to our wholesale balance sheet designed to reduce risk and support future earnings.”

    Balance Sheet

    • Total assets increased $169.7 million, or 2.2%, to $7.89 billion at September 30, 2022, from $7.72 billion at June 30, 2022.
    • Loans receivable increased $238.5 million, or 4.4%, to $5.66 billion at September 30, 2022, from $5.42 billion at June 30, 2022.
    • Deposits increased $246.0 million, or 4.2%, to $6.11 billion at September 30, 2022, from $5.86 billion at June 30, 2022. Non-interest-bearing deposits increased $29.5 million, or 4.5%, for the quarter ended September 30, 2022.
    • Investment securities decreased $83.3 million to $1.38 billion, or 17.5% of total assets, at September 30, 2022, from $1.46 billion, or 18.9% of total assets, at June 30, 2022.
    • Borrowings decreased $49.9 million to $851.5 million, or 10.8% of total assets, at September 30, 2022, from $901.3 million, or 11.7% of total assets, at June 30, 2022.

    Earnings

    Performance Highlights

    • Return on average assets was 0.85% for the quarter ended September 30, 2022 compared to 0.61% for the quarter ended June 30, 2022.
    • Return on average equity was 7.38% and 4.92% for the quarters ended September 30, 2022 and June 30, 2022, respectively. Return on average tangible equity was 9.70% and 6.40% for those same comparative periods.

    Net Interest Income and Net Interest Margin

    • Net interest margin contracted 23 basis points to 2.69% for the quarter ended September 30, 2022, from 2.92% for the quarter ended June 30, 2022. The decrease was due largely to an increase in the cost of interest-bearing liabilities, partially offset by increases in the average balance and yield on interest-earning assets.
    • Net interest income decreased $2.1 million to $48.5 million for the quarter ended September 30, 2022, from $50.6 million for the quarter ended June 30, 2022. Included in net interest income for the quarters ended September 30, 2022 and June 30, 2022, respectively, was purchase accounting accretion of $1.8 million and $1.6 million, and loan prepayment penalty income of $441,000 and $869,000.

    Non-Interest Income

    • Non-interest income increased $3.1 million to $5.9 million for the quarter ended September 30, 2022, from $2.8 million for the quarter ended June 30, 2022. The increase was largely attributable to higher income from bank owned life insurance that resulted from $2.1 million in payouts on life insurance policies.
    • Non-interest income included no gain or loss on the sale of securities for the quarter ended September 30, 2022 compared to a loss of $563,000 on the sale of securities for the quarter ended June 30, 2022.

    Non-Interest Expense

    • Non-interest expense decreased $1.6 million to $32.0 million for the quarter ended September 30, 2022, from $33.6 million for the quarter ended June 30, 2022. The decrease was primarily attributable to $1.0 million of non-recurring expenses recorded in the prior quarter.
    • The provision for credit losses on unfunded commitments, included in other expense, decreased $387,000 for the quarter ended September 30, 2022.
    • The efficiency and non-interest expense ratios were 58.75% and 1.65%, respectively, for the quarter ended September 30, 2022, as compared to 62.93% and 1.79%, respectively, for the quarter ended June 30, 2022.

    Income Taxes

    • Income tax expense totaled $5.3 million for the quarter ended September 30, 2022 compared to $4.2 million for the quarter ended June 30, 2022, resulting in an effective tax rate of 24.1% and 27.0%, respectively. The decrease in the effective tax rate primarily resulted from the payouts on life insurance policies, noted above, which were not taxable.

    Asset Quality

    • The balance of non-performing assets decreased $14.8 million to $77.4 million, or 0.98% of total assets, at September 30, 2022, from $92.2 million, or 1.19% of total assets, at June 30, 2022. The decrease in non-performing assets was primarily attributable to the sale of two non-accrual loans that were recorded as held-for-sale at June 30, 2022.
    • Net charge-offs totaled $115,000, or 0.01% of average loans, on an annualized basis, for the quarter ended September 30, 2022, compared to $1.0 million, or 0.08% of average loans, on an annualized basis, for the quarter ended June 30, 2022.
    • For the quarter ended September 30, 2022, the Company recorded a provision for credit losses of $670,000, compared to $4.2 million for the quarter ended June 30, 2022. The provision for the quarter ended September 30, 2022 was largely driven by loan growth of $238.5 million, partially offset by a reduction in the expected life of the loan portfolio.
    • The allowance for credit losses was $47.6 million, or 0.84% of total loans, at September 30, 2022, compared to $47.1 million, or 0.87% of total loans, at June 30, 2022.

    Capital

    • For the quarter ended September 30, 2022, book value per share decreased $0.14, or 1.1%, to $12.88 and tangible book value per share decreased $0.17, or 1.7%, to $9.73.
    • On August 1, 2022, the Company announced the authorization of a new stock repurchase plan, which authorized the repurchase of up to 4,000,000 shares. During the quarter ended September 30, 2022, the Company repurchased 759,806 shares of common stock at a cost of $8.7 million, or $11.44 per share.
    • At September 30, 2022, the Company’s tangible equity to tangible assets ratio equaled 8.61% and the regulatory capital ratios of both the Company and the Bank were in excess of the levels required by federal banking regulators to be classified as “well-capitalized” under regulatory guidelines.

    Statements contained in this news release that are not historical facts are forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks and uncertainties which could cause actual results to differ materially from those currently anticipated due to a number of factors, which include, but are not limited to, factors discussed in documents filed by the Company with the Securities and Exchange Commission from time to time. The Company does not undertake and specifically disclaims any obligation to update any forward-looking statement, whether written or oral, that may be made from time to time by or on behalf of the Company.

    In addition, the COVID-19 pandemic has had, and may continue to have, an adverse impact on the Company, its clients and the communities it serves. Given its dynamic nature, it is difficult to predict the full impact of the COVID-19 pandemic on our business.

    For further information contact:
    Craig L. Montanaro, President and Chief Executive Officer, or
    Keith Suchodolski, Senior Executive Vice President and Chief Financial Officer
    Kearny Financial Corp.
    (973) 244-4500

    Category: Earnings

    Linked-Quarter Comparative Financial Analysis

    Kearny Financial Corp.
    Consolidated Balance Sheets

    (Dollars and Shares in Thousands,
    Except Per Share Data)    		September 30,
    2022    		June 30,
    2022    		Variance
    or Change    		Variance
    or Change Pct.
     (Unaudited)(Audited)  
    Assets    
    Cash and cash equivalents$96,076 $101,615 $(5,539)-5.5%
    Securities available for sale 1,263,176  1,344,093  (80,917)-6.0%
    Securities held to maturity 115,943  118,291  (2,348)-2.0%
    Loans held-for-sale 12,936  28,874  (15,938)-55.2%
    Loans receivable 5,656,370  5,417,845  238,525 4.4%
    Less: allowance for credit losses on loans (47,613) (47,058) 555 1.2%
    Net loans receivable 5,608,757  5,370,787  237,970 4.4%
    Premises and equipment 52,642  53,281  (639)-1.2%
    Federal Home Loan Bank stock 44,957  47,144  (2,187)-4.6%
    Accrued interest receivable 23,817  20,466  3,351 16.4%
    Goodwill 210,895  210,895  — —%
    Core deposit intangible 2,876  3,020  (144)-4.8%
    Bank owned life insurance 289,690  289,177  513 0.2%
    Deferred income taxes, net 54,278  49,350  4,928 10.0%
    Other real estate owned 178  178  — —%
    Other assets 113,369  82,712  30,657 37.1%
    Total assets$7,889,590 $7,719,883 $169,707 2.2%
         
    Liabilities    
    Deposits:    
    Non-interest-bearing$683,406 $653,899 $29,507 4.5%
    Interest-bearing 5,424,872  5,208,357  216,515 4.2%
    Total deposits 6,108,278  5,862,256  246,022 4.2%
    Borrowings 851,454  901,337  (49,883)-5.5%
    Advance payments by borrowers for taxes 16,555  16,746  (191)-1.1%
    Other liabilities 38,329  45,544  (7,215)-15.8%
    Total liabilities 7,014,616  6,825,883  188,733 2.8%
         
    Stockholders' Equity    
    Common stock 680  687  (7)-1.0%
    Paid-in capital 520,245  528,396  (8,151)-1.5%
    Retained earnings 454,710  445,451  9,259 2.1%
    Unearned ESOP shares (24,321) (24,807) 486 2.0%
    Accumulated other comprehensive loss (76,340) (55,727) (20,613)-37.0%
    Total stockholders' equity 874,974  894,000  (19,026)-2.1%
    Total liabilities and stockholders' equity$7,889,590 $7,719,883 $169,707 2.2%
         
    Consolidated capital ratios    
    Equity to assets 11.09% 11.58% -0.49% 
    Tangible equity to tangible assets(1) 8.61% 9.06% -0.45% 
         
    Share data    
    Outstanding shares 67,938  68,666  (728)-1.1%
    Book value per share$12.88 $13.02 $(0.14)-1.1%
    Tangible book value per share(2)$9.73 $9.90 $(0.17)-1.7%

    _________________________

    (1)Tangible equity equals total stockholders' equity reduced by goodwill and core deposit intangible assets. Tangible assets equals total assets reduced by goodwill and core deposit intangible assets.
    (2)Tangible book value equals total stockholders' equity reduced by goodwill and core deposit intangible assets.  


    Kearny Financial Corp.
    Consolidated Statements of Income
    (Unaudited)

    (Dollars and Shares in Thousands,
    Except Per Share Data)

    		Three Months EndedVariance
    or Change
    		Variance
    or Change Pct.
    September 30,
    2022    		June 30,
    2022
    Interest income    
    Loans$52,935 $48,869 $4,066 8.3%
    Taxable investment securities 10,439  8,915  1,524 17.1%
    Tax-exempt investment securities 285  297  (12)-4.0%
    Other interest-earning assets 761  472  289 61.2%
    Total interest income 64,420  58,553  5,867 10.0%
         
    Interest expense    
    Deposits 10,869  3,915  6,954 177.6%
    Borrowings 5,020  4,039  981 24.3%
    Total interest expense 15,889  7,954  7,935 99.8%
    Net interest income 48,531  50,599  (2,068)-4.1%
    Provision for credit losses 670  4,222  (3,552)-84.1%
    Net interest income after provision for credit losses 47,861  46,377  1,484 3.2%
         
    Non-interest income    
    Fees and service charges 763  658  105 16.0%
    Loss on sale and call of securities —  (563) 563 100.0%
    Gain on sale of loans 395  187  208 111.2%
    Loss on sale of other real estate owned —  (9) 9 100.0%
    Income from bank owned life insurance 3,698  1,533  2,165 141.2%
    Electronic banking fees and charges 506  366  140 38.3%
    Other income 555  638  (83)-13.0%
    Total non-interest income 5,917  2,810  3,107 110.6%
         
    Non-interest expense    
    Salaries and employee benefits 20,348  20,367  (19)-0.1%
    Net occupancy expense of premises 3,090  3,188  (98)-3.1%
    Equipment and systems 3,662  4,516  (854)-18.9%
    Advertising and marketing 747  703  44 6.3%
    Federal deposit insurance premium 906  762  144 18.9%
    Directors' compensation 340  340  — —%
    Other expense 2,895  3,736  (841)-22.5%
    Total non-interest expense 31,988  33,612  (1,624)-4.8%
    Income before income taxes 21,790  15,575  6,215 39.9%
    Income taxes 5,255  4,205  1,050 25.0%
    Net income$16,535 $11,370 $5,165 45.4%
         
    Net income per common share (EPS)    
    Basic$0.25 $0.17 $0.08  
    Diluted$0.25 $0.17 $0.08  
         
    Dividends declared    
    Cash dividends declared per common share$0.11 $0.11 $—  
    Cash dividends declared$7,276 $7,441 $(165) 
    Dividend payout ratio 44.0% 65.4%(21.4)% 
         
    Weighted average number of common shares outstanding    
    Basic 65,737  67,240  (1,503) 
    Diluted 65,756  67,276  (1,520) 


    Kearny Financial Corp.
    Average Balance Sheet Data
    (Unaudited)

    (Dollars in Thousands)

    		Three Months EndedVariance
    or Change
    		Variance
    or Change Pct.
    September 30,
    2022    		June 30,
    2022
    Assets    
    Interest-earning assets:    
    Loans receivable, including loans held for sale$5,553,996 $5,181,983 $372,013 7.2%
    Taxable investment securities 1,516,974  1,608,372  (91,398)-5.7%
    Tax-exempt investment securities 48,973  51,672  (2,699)-5.2%
    Other interest-earning assets 88,038  87,990  48 0.1%
    Total interest-earning assets 7,207,981  6,930,017  277,964 4.0%
    Non-interest-earning assets 570,225  564,734  5,491 1.0%
    Total assets$7,778,206 $7,494,751 $283,455 3.8%
         
    Liabilities and Stockholders' Equity    
    Interest-bearing liabilities:    
    Deposits:    
    Interest-bearing demand$2,354,340 $2,155,946 $198,394 9.2%
    Savings 1,019,343  1,077,631  (58,288)-5.4%
    Certificates of deposit 2,014,922  1,701,725  313,197 18.4%
    Total interest-bearing deposits 5,388,605  4,935,302  453,303 9.2%
    Borrowings:    
    Federal Home Loan Bank advances 642,399  752,579  (110,180)-14.6%
    Other borrowings 127,456  185,901  (58,445)-31.4%
    Total borrowings 769,855  938,480  (168,625)-18.0%
    Total interest-bearing liabilities 6,158,460  5,873,782  284,678 4.8%
    Non-interest-bearing liabilities:    
    Non-interest-bearing deposits 667,624  640,200  27,424 4.3%
    Other non-interest-bearing liabilities 56,431  56,636  (205)-0.4%
    Total non-interest-bearing liabilities 724,055  696,836  27,219 3.9%
    Total liabilities 6,882,515  6,570,618  311,897 4.7%
    Stockholders' equity 895,691  924,133  (28,442)-3.1%
    Total liabilities and stockholders' equity$7,778,206 $7,494,751 $283,455 3.8%
         
    Average interest-earning assets to average interest-bearing liabilities 117.04% 117.98% -0.94%-0.8%


    Kearny Financial Corp.
    Performance Ratio Highlights
    (Unaudited)

     Three Months EndedVariance
    or Change
     September 30,
    2022    		June 30,
    2022
    Average yield on interest-earning assets:   
    Loans receivable, including loans held for sale3.81%3.77%0.04%
    Taxable investment securities2.75%2.22%0.53%
    Tax-exempt investment securities (1)2.33%2.30%0.03%
    Other interest-earning assets3.46%2.15%1.31%
    Total interest-earning assets3.57%3.38%0.19%
        
    Average cost of interest-bearing liabilities:   
    Deposits:   
    Interest-bearing demand0.92%0.31%0.61%
    Savings0.23%0.11%0.12%
    Certificates of deposit0.97%0.46%0.51%
    Total interest-bearing deposits0.81%0.32%0.49%
    Borrowings:   
    Federal Home Loan Bank advances2.68%1.96%0.72%
    Other borrowings2.26%0.77%1.49%
    Total borrowings2.61%1.72%0.89%
    Total interest-bearing liabilities1.03%0.54%0.49%
        
    Interest rate spread (2)2.54%2.84%-0.30%
    Net interest margin (3)2.69%2.92%-0.23%
        
    Non-interest income to average assets (annualized)0.30%0.15%0.15%
    Non-interest expense to average assets (annualized)1.65%1.79%-0.14%
        
    Efficiency ratio (4)58.75%62.93%-4.18%
        
    Return on average assets (annualized)0.85%0.61%0.24%
    Return on average equity (annualized)7.38%4.92%2.46%
    Return on average tangible equity (annualized) (5)9.70%6.40%3.30%

    _________________________

    (1)The yield on tax-exempt investment securities has not been adjusted to reflect their tax-effective yield.
    (2)Interest income divided by average interest-earning assets less interest expense divided by average interest-bearing liabilities.
    (3)Net interest income divided by average interest-earning assets.
    (4)Non-interest expense divided by the sum of net interest income and non-interest income.
    (5)Average tangible equity equals total average stockholders’ equity reduced by average goodwill and average core deposit intangible assets.


     
    Five-Quarter Financial Trend Analysis

    Kearny Financial Corp.
    Consolidated Balance Sheets

    (Dollars and Shares in Thousands,
    Except Per Share Data)    		September 30,
    2022    		June 30,
    2022    		March 31,
    2022    		December 31,
    2021    		September 30,
    2021
     (Unaudited)(Audited)(Unaudited)(Unaudited)(Unaudited)
    Assets     
    Cash and cash equivalents$96,076 $101,615 $62,379 $60,452 $54,070 
    Securities available for sale 1,263,176  1,344,093  1,526,086  1,591,066  1,651,156 
    Securities held to maturity 115,943  118,291  121,853  53,142  37,497 
    Loans held-for-sale 12,936  28,874  2,822  12,549  12,884 
    Loans receivable 5,656,370  5,417,845  5,003,201  4,826,404  4,789,339 
    Less: allowance for credit losses on loans (47,613) (47,058) (43,860) (48,216) (51,785)
    Net loans receivable 5,608,757  5,370,787  4,959,341  4,778,188  4,737,554 
    Premises and equipment 52,642  53,281  53,727  54,067  55,236 
    Federal Home Loan Bank stock 44,957  47,144  30,997  36,622  36,615 
    Accrued interest receivable 23,817  20,466  19,517  18,495  19,541 
    Goodwill 210,895  210,895  210,895  210,895  210,895 
    Core deposit intangible 2,876  3,020  3,166  3,344  3,524 
    Bank owned life insurance 289,690  289,177  287,644  286,433  284,871 
    Deferred income taxes, net 54,278  49,350  34,349  25,709  27,771 
    Other real estate owned 178  178  401  658  178 
    Other assets 113,369  82,712  76,714  54,603  51,896 
    Total assets$7,889,590 $7,719,883 $7,389,891 $7,186,223 $7,183,688 
          
    Liabilities     
    Deposits:     
    Non-interest-bearing$683,406 $653,899 $621,954 $604,805 $631,344 
    Interest-bearing 5,424,872  5,208,357  4,906,708  4,849,220  4,763,795 
    Total deposits 6,108,278  5,862,256  5,528,662  5,454,025  5,395,139 
    Borrowings 851,454  901,337  851,220  686,105  720,990 
    Advance payments by borrowers for taxes 16,555  16,746  16,979  16,772  16,222 
    Other liabilities 38,329  45,544  37,861  33,851  36,914 
    Total liabilities 7,014,616  6,825,883  6,434,722  6,190,753  6,169,265 
          
    Stockholders' Equity     
    Common stock 680  687  714  735  758 
    Paid-in capital 520,245  528,396  561,176  587,392  616,894 
    Retained earnings 454,710  445,451  441,522  431,549  420,701 
    Unearned ESOP shares (24,321) (24,807) (25,294) (25,780) (26,266)
    Accumulated other comprehensive (loss) income (76,340) (55,727) (22,949) 1,574  2,336 
    Total stockholders' equity 874,974  894,000  955,169  995,470  1,014,423 
    Total liabilities and stockholders' equity$7,889,590 $7,719,883 $7,389,891 $7,186,223 $7,183,688 
          
    Consolidated capital ratios     
    Equity to assets 11.09% 11.58% 12.93% 13.85% 14.12%
    Tangible equity to tangible assets(1) 8.61% 9.06% 10.33% 11.21% 11.48%
          
    Share data     
    Outstanding shares 67,938  68,666  71,424  73,453  75,800 
    Book value per share$12.88 $13.02 $13.37 $13.55 $13.38 
    Tangible book value per share(2)$9.73 $9.90 $10.38 $10.64 $10.55 

    _________________________

    (1)Tangible equity equals total stockholders' equity reduced by goodwill and core deposit intangible assets. Tangible assets equals total assets reduced by goodwill and core deposit intangible assets.
    (2)Tangible book value equals total stockholders' equity reduced by goodwill and core deposit intangible assets.


    Kearny Financial Corp.
    Supplemental Balance Sheet Highlights
    (Unaudited)

    (Dollars in Thousands)September 30,
    2022    		June 30,
    2022    		March 31,
    2022    		December 31,
    2021    		September 30,
    2021
    Loan portfolio composition:     
    Commercial loans:     
    Multi-family mortgage$2,570,297 $2,409,090 $2,076,003 $2,007,431 $1,978,681 
    Nonresidential mortgage 1,040,688  1,019,838  1,085,988  1,026,447  1,023,391 
    Commercial business 186,361  176,807  169,551  180,429  169,392 
    Construction 166,052  140,131  121,137  110,703  112,226 
    Total commercial loans 3,963,398  3,745,866  3,452,679  3,325,010  3,283,690 
    One- to four-family residential mortgage 1,666,730  1,645,816  1,527,980  1,477,267  1,483,106 
    Consumer loans:     
    Home equity loans 43,269  42,028  41,501  43,934  44,912 
    Other consumer 2,869  2,866  2,755  3,040  3,020 
    Total consumer loans 46,138  44,894  44,256  46,974  47,932 
    Total loans, excluding yield adjustments 5,676,266  5,436,576  5,024,915  4,849,251  4,814,728 
    Unaccreted yield adjustments (19,896) (18,731) (21,714) (22,847) (25,389)
    Loans receivable, net of yield adjustments 5,656,370  5,417,845  5,003,201  4,826,404  4,789,339 
    Less: allowance for credit losses on loans (47,613) (47,058) (43,860) (48,216) (51,785)
    Net loans receivable$5,608,757 $5,370,787 $4,959,341 $4,778,188 $4,737,554 
          
    Asset quality:     
    Nonperforming assets:     
    Accruing loans - 90 days and over past due$— $— $— $— $— 
    Nonaccrual loans 68,574  70,321  80,595  72,138  72,945 
    Total nonperforming loans 68,574  70,321  80,595  72,138  72,945 
    Nonaccrual loans held-for-sale 8,650  21,745  —  —  — 
    Other real estate owned 178  178  401  658  178 
    Total nonperforming assets$77,402 $92,244 $80,996 $72,796 $73,123 
          
    Nonperforming loans (% total loans) 1.21% 1.30% 1.61% 1.49% 1.52%
    Nonperforming assets (% total assets) 0.98% 1.19% 1.10% 1.01% 1.02%
          
    Classified loans$92,610 $94,555 $163,621 $162,174 $170,449 
          
    Allowance for credit losses on loans (ACL):     
    ACL to total loans 0.84% 0.87% 0.87% 0.99% 1.08%
    ACL to nonperforming loans 69.43% 66.92% 54.42% 66.84% 70.99%
    Net charge-offs$115 $1,024 $436 $1,149 $980 
    Average net charge-off rate (annualized) 0.01% 0.08% 0.04% 0.10% 0.08%
          
    Funding composition:     
    Deposits:     
    Non-interest-bearing deposits$683,406 $653,899 $621,954 $604,805 $631,344 
    Interest-bearing demand 2,382,411  2,265,597  2,154,488  2,106,693  1,937,661 
    Savings 982,916  1,053,198  1,088,974  1,087,740  1,089,699 
    Certificates of deposit (retail) 1,263,124  1,116,035  1,122,228  1,184,530  1,264,016 
    Certificates of deposit (brokered and listing service) 796,421  773,527  541,018  470,257  472,419 
    Interest-bearing deposits 5,424,872  5,208,357  4,906,708  4,849,220  4,763,795 
    Total deposits 6,108,278  5,862,256  5,528,662  5,454,025  5,395,139 
          
    Borrowings:     
    Federal Home Loan Bank advances 796,454  651,337  541,220  666,105  665,990 
    Overnight borrowings 55,000  250,000  310,000  20,000  55,000 
    Total borrowings 851,454  901,337  851,220  686,105  720,990 
          
    Total funding$6,959,732 $6,763,593 $6,379,882 $6,140,130 $6,116,129 
          
    Loans as a % of deposits 92.0% 92.1% 89.8% 87.8% 88.1%
    Deposits as a % of total funding 87.8% 86.7% 86.7% 88.8% 88.2%
    Borrowings as a % of total funding 12.2% 13.3% 13.3% 11.2% 11.8%


    Kearny Financial Corp.
    Consolidated Statements of Income
    (Unaudited)

     Three Months Ended
    (Dollars and Shares in Thousands,
    Except Per Share Data)    		September 30,
    2022    		June 30,
    2022    		March 31,
    2022    		December 31,
    2021    		September 30,
    2021
    Interest income     
    Loans$52,935 $48,869 $45,846 $47,575 $48,230 
    Taxable investment securities 10,439  8,915  8,024  7,595  8,212 
    Tax-exempt investment securities 285  297  316  327  333 
    Other interest-earning assets 761  472  415  415  431 
    Total interest income 64,420  58,553  54,601  55,912  57,206 
          
    Interest expense     
    Deposits 10,869  3,915  3,565  3,663  4,065 
    Borrowings 5,020  4,039  3,309  3,562  3,551 
    Total interest expense 15,889  7,954  6,874  7,225  7,616 
    Net interest income 48,531  50,599  47,727  48,687  49,590 
    Provision for (reversal of) credit losses 670  4,222  (3,920) (2,420) (5,400)
    Net interest income after provision for (reversal of) credit losses 47,861  46,377  51,647  51,107  54,990 
          
    Non-interest income     
    Fees and service charges 763  658  617  698  607 
    (Loss) gain on sale and call of securities —  (563) 3  —  1 
    Gain on sale of loans 395  187  376  970  1,006 
    (Loss) gain on sale of other real estate owned —  (9) 14  —  — 
    Income from bank owned life insurance 3,698  1,533  1,511  1,562  1,561 
    Electronic banking fees and charges 506  366  432  421  407 
    Other income 555  638  238  482  218 
    Total non-interest income 5,917  2,810  3,191  4,133  3,800 
          
    Non-interest expense     
    Salaries and employee benefits 20,348  20,367  19,184  18,096  18,617 
    Net occupancy expense of premises 3,090  3,188  3,223  3,156  4,547 
    Equipment and systems 3,662  4,516  3,822  3,723  3,825 
    Advertising and marketing 747  703  516  448  392 
    Federal deposit insurance premium 906  762  480  721  492 
    Directors' compensation 340  340  340  649  803 
    Other expense 2,895  3,736  3,058  2,877  3,127 
    Total non-interest expense 31,988  33,612  30,623  29,670  31,803 
    Income before income taxes 21,790  15,575  24,215  25,570  26,987 
    Income taxes 5,255  4,205  6,522  6,801  7,272 
    Net income$16,535 $11,370 $17,693 $18,769 $19,715 
          
    Net income per common share (EPS)     
    Basic$0.25 $0.17 $0.25 $0.26 $0.26 
    Diluted$0.25 $0.17 $0.25 $0.26 $0.26 
          
    Dividends declared     
    Cash dividends declared per common share$0.11 $0.11 $0.11 $0.11 $0.10 
    Cash dividends declared$7,276 $7,441 $7,720 $7,921 $7,381 
    Dividend payout ratio 44.0% 65.4% 43.6% 42.2% 37.4%
          
    Weighted average number of common shares outstanding     
    Basic 65,737  67,240  69,790  72,011  74,537 
    Diluted 65,756  67,276  69,817  72,037  74,556 


    Kearny Financial Corp.
    Average Balance Sheet Data
    (Unaudited)

     Three Months Ended
    (Dollars in Thousands)September 30,
    2022    		June 30,
    2022    		March 31,
    2022    		December 31,
    2021    		September 30,
    2021
    Assets     
    Interest-earning assets:     
    Loans receivable, including loans held-for-sale$5,553,996 $5,181,983 $4,850,236 $4,822,959 $4,835,676 
    Taxable investment securities 1,516,974  1,608,372  1,620,996  1,610,395  1,649,953 
    Tax-exempt investment securities 48,973  51,672  55,390  57,686  59,115 
    Other interest-earning assets 88,038  87,990  79,644  77,811  85,749 
    Total interest-earning assets 7,207,981  6,930,017  6,606,266  6,568,851  6,630,493 
    Non-interest-earning assets 570,225  564,734  601,684  611,390  616,735 
    Total assets$7,778,206 $7,494,751 $7,207,950 $7,180,241 $7,247,228 
          
    Liabilities and Stockholders' Equity     
    Interest-bearing liabilities:     
    Deposits:     
    Interest-bearing demand$2,354,340 $2,155,946 $2,133,977 $2,027,021 $1,954,271 
    Savings 1,019,343  1,077,631  1,088,351  1,086,903  1,102,865 
    Certificates of deposit 2,014,922  1,701,725  1,650,048  1,693,423  1,798,473 
    Total interest-bearing deposits 5,388,605  4,935,302  4,872,376  4,807,347  4,855,609 
    Borrowings:     
    Federal Home Loan Bank advances 642,399  752,579  632,811  666,029  665,915 
    Other borrowings 127,456  185,901  51,667  26,033  28,532 
    Total borrowings 769,855  938,480  684,478  692,062  694,447 
    Total interest-bearing liabilities 6,158,460  5,873,782  5,556,854  5,499,409  5,550,056 
    Non-interest-bearing liabilities:     
    Non-interest-bearing deposits 667,624  640,200  624,152  624,200  610,271 
    Other non-interest-bearing liabilities 56,431  56,636  49,455  50,870  56,893 
    Total non-interest-bearing liabilities 724,055  696,836  673,607  675,070  667,164 
    Total liabilities 6,882,515  6,570,618  6,230,461  6,174,479  6,217,220 
    Stockholders' equity 895,691  924,133  977,489  1,005,762  1,030,008 
    Total liabilities and stockholders' equity$7,778,206 $7,494,751 $7,207,950 $7,180,241 $7,247,228 
          
    Average interest-earning assets to average
    interest-bearing liabilities    		 117.04% 117.98% 118.89% 119.45% 119.47%


    Kearny Financial Corp.
    Performance Ratio Highlights

     Three Months Ended
     September 30,
    2022    		June 30,
    2022    		March 31,
    2022    		December 31,
    2021    		September 30,
    2021
    Average yield on interest-earning assets:     
    Loans receivable, including loans held-for-sale3.81%3.77%3.78%3.95%3.99%
    Taxable investment securities2.75%2.22%1.98%1.89%1.99%
    Tax-exempt investment securities (1)2.33%2.30%2.28%2.26%2.25%
    Other interest-earning assets3.46%2.15%2.08%2.13%2.01%
    Total interest-earning assets3.57%3.38%3.31%3.40%3.45%
          
    Average cost of interest-bearing liabilities:     
    Deposits:     
    Interest-bearing demand0.92%0.31%0.22%0.22%0.23%
    Savings0.23%0.11%0.10%0.11%0.12%
    Certificates of deposit0.97%0.46%0.52%0.53%0.57%
    Total interest-bearing deposits0.81%0.32%0.29%0.30%0.33%
    Borrowings:     
    Federal Home Loan Bank advances2.68%1.96%2.08%2.14%2.13%
    Other borrowings2.26%0.77%0.17%0.09%0.10%
    Total borrowings2.61%1.72%1.93%2.06%2.05%
    Total interest-bearing liabilities1.03%0.54%0.49%0.53%0.55%
          
    Interest rate spread (2)2.54%2.84%2.82%2.87%2.90%
    Net interest margin (3)2.69%2.92%2.89%2.96%2.99%
          
    Non-interest income to average assets
    (annualized)    		0.30%0.15%0.18%0.23%0.21%
    Non-interest expense to average assets
    (annualized)    		1.65%1.79%1.70%1.65%1.76%
          
    Efficiency ratio (4)58.75%62.93%60.14%56.17%59.57%
          
    Return on average assets (annualized)0.85%0.61%0.98%1.05%1.09%
    Return on average equity (annualized)7.38%4.92%7.24%7.46%7.66%
    Return on average tangible equity (annualized) (5)9.70%6.40%9.27%9.49%9.67%

    _________________________

    (1)The yield on tax-exempt investment securities has not been adjusted to reflect their tax-effective yield.
    (2)Interest income divided by average interest-earning assets less interest expense divided by average interest-bearing liabilities.
    (3)Net interest income divided by average interest-earning assets.
    (4)Non-interest expense divided by the sum of net interest income and non-interest income.
    (5)Average tangible equity equals total average stockholders’ equity reduced by average goodwill and average core deposit intangible assets.

      
    The following tables provide a reconciliation of certain financial measures calculated in accordance with Generally Accepted Accounting Principles (“GAAP”) (as reported) and non-GAAP measures. These non-GAAP measures provide additional information which allow readers to evaluate the ongoing performance of the Company. They are not a substitute for GAAP measures; they should be read and used in conjunction with the Company’s GAAP financial information. In all cases, it should be understood that non-GAAP per share measures do not depict amounts that accrue directly to the benefit of shareholders.

    Kearny Financial Corp.
    Reconciliation of GAAP to Non-GAAP
    (Unaudited)

     Three Months Ended
    (Dollars and Shares in Thousands,
    Except Per Share Data)    		September 30,
    2022    		June 30,
    2022    		March 31,
    2022    		December 31,
    2021    		September 30,
    2021
    Adjusted net income:     
    Net income (GAAP)$16,535 $11,370 $17,693 $18,769 $19,715 
    Non-recurring transactions - net of tax:     
    Early contract termination —  568  —  —  — 
    Branch consolidation expenses and
    impairment charges    		 —  —  —  132  1,209 
    Net effect of sale and call of securities —  400  (2) —  (1)
    Net effect of sale of other assets —  —  —  (251) — 
    Adjusted net income$16,535 $12,338 $17,691 $18,650 $20,923 
          
    Calculation of pre-tax, pre-provision net revenue:     
    Net income (GAAP)$16,535 $11,370 $17,693 $18,769 $19,715 
    Adjustments to net income (GAAP):     
    Provision for income taxes 5,255  4,205  6,522  6,801  7,272 
    Provision for (reversal of) credit losses 670  4,222  (3,920) (2,420) (5,400)
    Pre-tax, pre-provision net revenue (non-GAAP)$22,460 $19,797 $20,295 $23,150 $21,587 
          
    Adjusted earnings per share:     
    Weighted average common shares - basic 65,737  67,240  69,790  72,011  74,537 
    Weighted average common shares - diluted 65,756  67,276  69,817  72,037  74,556 
          
    Earnings per share - basic (GAAP)$0.25 $0.17 $0.25 $0.26 $0.26 
    Earnings per share - diluted (GAAP)$0.25 $0.17 $0.25 $0.26 $0.26 
          
    Adjusted earnings per share - basic (non-GAAP)$0.25 $0.18 $0.25 $0.26 $0.28 
    Adjusted earnings per share - diluted (non-GAAP)$0.25 $0.18 $0.25 $0.26 $0.28 
          
    Pre-tax, pre-provision net revenue per share:     
    Pre-tax, pre-provision net revenue per share - basic
    (non-GAAP)    		$0.34 $0.29 $0.29 $0.32 $0.29 
    Pre-tax, pre-provision net revenue per share - diluted
    (non-GAAP)    		$0.34 $0.29 $0.29 $0.32 $0.29 
          
    Adjusted return on average assets:     
    Total average assets$7,778,206 $7,494,751 $7,207,950 $7,180,241 $7,247,228 
          
    Return on average assets (GAAP) 0.85% 0.61% 0.98% 1.05% 1.09%
    Adjusted return on average assets (non-GAAP) 0.85% 0.66% 0.98% 1.04% 1.15%
          
    Adjusted return on average equity:     
    Total average equity$895,691 $924,133 $977,489 $1,005,762 $1,030,008 
          
    Return on average equity (GAAP) 7.38% 4.92% 7.24% 7.46% 7.66%
    Adjusted return on average equity (non-GAAP) 7.38% 5.34% 7.24% 7.42% 8.13%


    Kearny Financial Corp.
    Reconciliation of GAAP to Non-GAAP
    (Unaudited)

     Three Months Ended
    (Dollars and Shares in Thousands,
    Except Per Share Data)    		September 30,
    2022    		June 30,
    2022    		March 31,
    2022    		December 31,
    2021    		September 30,
    2021
    Adjusted return on average tangible equity:     
    Total average equity$895,691 $924,133 $977,489 $1,005,762 $1,030,008 
    Less: average goodwill (210,895) (210,895) (210,895) (210,895) (210,895)
    Less: average other intangible assets (2,971) (3,116) (3,282) (3,462) (3,641)
    Total average tangible equity$681,825 $710,122 $763,312 $791,405 $815,472 
          
    Return on average tangible equity (non-GAAP) 9.70% 6.40% 9.27% 9.49% 9.67%
    Adjusted return on average tangible equity (non-GAAP) 9.70% 6.95% 9.27% 9.43% 10.26%
          
    Adjusted non-interest expense ratio:     
    Non-interest expense (GAAP)$31,988 $33,612 $30,623 $29,670 $31,803 
    Non-recurring transactions:     
    Early contract termination —  (800) —  —  — 
    Branch consolidation expenses and
    impairment charges    		 —  —  —  (187) (1,711)
    Non-interest expense (non-GAAP)$31,988 $32,812 $30,623 $29,483 $30,092 
          
    Non-interest expense ratio (GAAP) 1.65% 1.79% 1.70% 1.65% 1.76%
    Adjusted non-interest expense ratio (non-GAAP) 1.65% 1.75% 1.70% 1.64% 1.66%
          
    Adjusted efficiency ratio:     
    Non-interest expense (non-GAAP)$31,988 $32,812 $30,623 $29,483 $30,092 
          
    Net interest income (GAAP)$48,531 $50,599 $47,727 $48,687 $49,590 
    Total non-interest income (GAAP) 5,917  2,810  3,191  4,133  3,800 
    Non-recurring transactions:     
    Net effect of sale and call of securities —  563  (3) —  (1)
    Net effect of sale of other assets —  —  —  (356) — 
    Total revenue (non-GAAP)$54,448 $53,972 $50,915 $52,464 $53,389 
          
    Efficiency ratio (GAAP) 58.75% 62.93% 60.14% 56.17% 59.57%
    Adjusted efficiency ratio (non-GAAP) 58.75% 60.79% 60.15% 56.20% 56.36%

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