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Dime Community Bancshares, Inc. Reports Second Quarter 2024 Results With Earnings Per Share Increasing By 5% Versus the Prior Quarter
المصدر: Nasdaq GlobeNewswire / 23 يوليو 2024 07:30:01 America/New_York
Strong Core Deposit Growth Drives 20 Basis Points of Net Interest Margin Expansion
Deposit and Business Loan Growth Driven by Execution of Growth Plan;
Successfully Onboarded Eight New Deposit Groups in the Second QuarterSubordinated Debt Offering Bolsters Total Capital Ratio to 14.5%
HAUPPAUGE, N.Y., July 23, 2024 (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 $16.7 million for the quarter ended June 30, 2024, or $0.43 per diluted common share, compared to $15.9 million, or $0.41 per diluted common share, for the quarter ended March 31, 2024, and $25.7 million, or $0.66 per diluted common share for the quarter ended June 30, 2023.
Stuart H. Lubow, President and Chief Executive Officer (“CEO”) of the Company, stated, “We continue to execute on our growth plan, which prioritizes core deposit growth and diversifying our balance sheet. The deposit-gathering Groups in our Private and Commercial Bank have grown their portfolio to approximately $1 billion. The growth in low-cost core deposits drove a significant expansion in our Net Interest Margin for the second quarter. In addition, the investments and hires we have made over the last two years in our Middle Market C&I lending operations are beginning to pay dividends as evidenced by the strong growth in our Business Loan portfolio. Finally, with the successful completion of our Subordinated Debt offering, Dime’s Total Risk Based Capital Ratio is now best-in-class when compared to other community and regional banks in our footprint with over $10 billion of assets. With a Total Risk Based Capital Ratio of 14.5%, we are well positioned to take advantage of growth opportunities in the future.”
Highlights for the Second Quarter of 2024 Included:
- Core deposits (excluding brokered and time deposits) increased $302.4 million compared to the first quarter of 2024;
- The ratio of average non-interest-bearing deposits to average total deposits for the second quarter was 28% compared to 27% for the first quarter of 2024;
- The cost of total deposits declined by 1 basis point versus the prior quarter;
- Business loans increased by over $200 million versus the prior quarter;
- The net interest margin increased to 2.41% for the second quarter of 2024 compared to 2.21% for the prior quarter;
- Non-performing assets and loans 90 days past due declined by 29% versus the prior quarter and represented only 0.18% of total assets as of June 30, 2024;
- The Company raised $65 million of gross proceeds from the issuance of subordinated notes in the second quarter; the offering increased the Company’s Total Risk Based Capital Ratio to 14.5%.
Management’s Discussion of Quarterly Operating Results
Net Interest Income
Net interest income for the second quarter of 2024 was $75.5 million compared to $71.5 million for the first quarter of 2024 and $80.2 million for the second quarter of 2023.
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) Q2 2024 Q1 2024 Q2 2023 Net interest income $ 75,502 $ 71,530 $ 80,219 Purchase accounting amortization (accretion) on loans ("PAA") (101 ) (82 ) 58 Adjusted net interest income excluding PAA on loans (non-GAAP) $ 75,401 $ 71,448 $ 80,277 Average interest-earning assets $ 12,624,556 $ 13,015,755 $ 12,888,522 NIM (1) 2.41 % 2.21 % 2.50 % Adjusted NIM excluding PAA on loans (non-GAAP) (2) 2.40 % 2.21 % 2.50 %
(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 PAA amortization on acquired loans divided by average interest-earning assets.During the quarter ended June 30, 2024, there was a recovery of interest income from a loan that was previously on non-accrual status in the amount of $1.3 million. This recovery of interest income had a 4 basis point favorable impact on the second quarter NIM.
Loan Portfolio
The ending weighted average rate (“WAR”) on the total loan portfolio was 5.39% at June 30, 2024, a 5 basis point increase compared to the ending WAR of 5.34% on the total loan portfolio at March 31, 2024.
Outlined below are loan balances and WARs for the quarter ended as indicated.
June 30, 2024 March 31, 2024 June 30, 2023 (Dollars in thousands) Balance WAR (1) Balance WAR (1) Balance WAR (1) Loans held for investment balances at period end: Business loans (2) $ 2,530,896 6.92 % $ 2,327,403 6.90 % $ 2,250,108 6.56 % One-to-four family residential, including condominium and cooperative apartment 906,949 4.55 873,671 4.48 855,980 4.17 Multifamily residential and residential mixed-use (3)(4) 3,920,354 4.59 3,996,654 4.57 4,132,358 4.38 Non-owner-occupied commercial real estate 3,315,100 5.25 3,386,333 5.24 3,406,232 5.04 Acquisition, development, and construction 144,860 8.96 175,352 8.40 225,580 8.99 Other loans 6,699 3.39 5,170 7.10 6,157 6.74 Loans held for investment $ 10,824,858 5.39 % $ 10,764,583 5.34 % $ 10,876,415 5.12 %
(1) Weighted average rate is calculated by aggregating interest based on the current loan rate from each loan in the category, adjusted for non-accrual loans, divided by the total balance of loans in the category.
(2) Business loans include commercial and industrial loans and owner-occupied commercial real estate loans.
(3) Includes loans underlying multifamily cooperatives.
(4) While the loans within this category are often considered "commercial real estate" in nature, multifamily and loans underlying cooperatives are here reported separately from commercial real estate loans in order to emphasize the residential nature of the collateral underlying this significant component of the total loan portfolio.Outlined below are the loan originations, for the quarter ended as indicated.
(Dollars in millions) Q2 2024 Q1 2024 Q2 2023 Loan originations $ 162.4 $ 98.3 $ 296.6 Deposits and Borrowed Funds
Period end total deposits (including mortgage escrow deposits) at June 30, 2024 were $11.03 billion, compared to $10.90 billion at March 31, 2024 and $10.53 billion at December 31, 2023.
On June 28, 2024, the Company raised $65.0 million of gross proceeds from a registered public offering of its 9.000% fixed-to-floating rate subordinated notes due 2034 (the “Notes”). Subsequently, on July 9, 2024, the Company issued and sold an additional $9.8 million of Notes, pursuant to an overallotment option granted to the underwriters of the offering. Including the overallotment option, the total gross proceeds from the offering were $74.8 million, before discounts and estimated offering expenses.
Total Federal Home Loan Bank advances were $633.0 million at June 30, 2024 compared to $773.0 million at March 31, 2024 and $1.31 billion at December 31, 2023. Mr. Lubow commented, “During the second quarter of 2024, we continued our strategy of utilizing core deposit growth to reduce our wholesale funding position.”
Non-Interest Income
Non-interest income was $11.8 million during the second quarter of 2024, $10.5 million during the first quarter of 2024, and $10.4 million during the second quarter of 2023. Included in non-interest income for the second and the first quarter of 2024, was income related to the sale of premises of approximately $3.7 million and $3.0 million, respectively.
Non-Interest Expense
Total non-interest expense was $55.7 million during the second quarter of 2024, $52.5 million during the first quarter of 2024, and $52.2 million during the second quarter of 2023. Excluding the impact of the loss on extinguishment of debt, amortization of other intangible assets and severance expense, adjusted non-interest expense was $55.4 million during the second quarter of 2024, $51.7 million during the first quarter of 2024, and $51.4 million during the second quarter of 2023 (see “Non-GAAP Reconciliation” tables at the end of this news release).
Mr. Lubow commented, “The increase in non-interest expense on a year-over-year basis has been due to the significant investments and hires the Company has made in its Private and Commercial Bank, including the hiring and onboarding of 15 deposit-gathering Groups, and its Middle Market C&I Lending operations, including a new Healthcare vertical and a Not-for Profit vertical. The new bankers we have hired have a long runway ahead of them and over time we expect them to contribute meaningfully to the revenue growth of the Company.”
The ratio of non-interest expense to average assets was 1.66% during the second quarter of 2024, compared to 1.52% during the linked quarter and 1.53% for the second quarter of 2023. Excluding the impact of the loss on extinguishment of debt, amortization of other intangible assets and severance expense, the ratio of adjusted non-interest expense to average assets was 1.65% during the second quarter of 2024, compared to 1.50% during the linked quarter and 1.51% for the second quarter of 2023 (see “Non-GAAP Reconciliation” tables at the end of this news release).
The efficiency ratio was 63.8% during the second quarter of 2024, compared to 64.0% during the linked quarter and 57.6% during the second quarter of 2023. Excluding the impact of net (gain) loss on sale of securities and other assets, fair value change in equity securities and loans held for sale, severance expense, loss on extinguishment of debt and amortization of other intangible assets the adjusted efficiency ratio was 65.9% during the second quarter of 2024, compared to 64.7% during the linked quarter and 56.2% during the second quarter of 2023 (see “Non-GAAP Reconciliation” tables at the end of this news release).
Income Tax Expense
The reported effective tax rate for the second quarter of 2024 was 29.0% compared to 27.1% for the first quarter of 2024, and 26.8% for the second quarter of 2023. The effective tax rate for the third quarter of 2024 is expected to be approximately 27%.
Credit Quality
Non-performing loans decreased 29% on a linked quarter basis to $24.8 million at June 30, 2024.
A credit loss provision of $5.6 million was recorded during the second quarter of 2024, compared to a credit loss provision of $5.2 million during the first quarter of 2024, and a credit loss provision of $892 thousand during the second quarter of 2023.
Capital Management
The Company’s and the Bank’s regulatory capital ratios continued to be in excess of all applicable regulatory requirements as of June 30, 2024. All risk-based regulatory capital ratios increased in the second quarter of 2024. Mr. Lubow commented, “Having fortified our capital base with the issuance of subordinated debt, we are well positioned to support all of our customers’ needs and capitalize on the significant disruption in our marketplace caused by various bank failures and mergers.”
Dividends per common share were $0.25 during the second and first quarters of 2024, respectively.
Book value per common share was $28.97 at June 30, 2024 compared to $28.84 at March 31, 2024.
Tangible common book value per share (which represents common equity less goodwill and other intangible assets, divided by the number of shares outstanding) was $24.87 at June 30, 2024 compared to $24.72 at March 31, 2024 (see “Non-GAAP Reconciliation” tables at the end of this news release).
Earnings Call Information
The Company will conduct a conference call at 9:00 a.m. (ET) on Tuesday, July 23, 2024, during which CEO Lubow will discuss the Company’s second quarter 2024 financial performance, with a question-and-answer session to follow.
Participants may access the conference call via webcast using this link: https://edge.media-server.com/mmc/p/vesm9tv4. To participate via telephone, please register in advance using this link: https://register.vevent.com/register/BIed4082edb56740ce983e3a3e5c43d5e5. Upon registration, all telephone participants will receive a one-time confirmation email detailing how to join the conference call, including the dial-in number along with a unique PIN that can be used to access the call. All participants are encouraged to dial-in 10 minutes prior to the start time.
A replay of the conference call and webcast will be available on-demand for 12 months at https://edge.media-server.com/mmc/p/vesm9tv4.
ABOUT DIME COMMUNITY BANCSHARES, INC.
Dime Community Bancshares, Inc. is the holding company for Dime Community Bank, a New York State-chartered trust company with over $13.5 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 with 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, the cost of funds, loan demand or real estate values may adversely affect the business of the Company; changes in the quality and composition of the Company’s loan or investment portfolios or unanticipated or significant increases in loan losses may negatively affect the Company’s financial condition or results of operations; changes in accounting principles, policies or guidelines may cause the Company’s financial condition to be perceived differently; changes in corporate and/or individual income tax laws may adversely affect the Company's financial condition or results of operations; general socio-economic conditions, public health emergencies, international conflict, inflation, and recessionary pressures, either nationally or locally in some or all areas in which the Company conducts business, or conditions in the securities markets or the banking industry may be less favorable than the Company currently anticipates and may adversely affect our customers, our financial results and our operations; legislation or regulatory changes may adversely affect the Company’s business; technological changes may be more difficult or expensive than the Company anticipates; there may be failures or breaches of information technology security systems; success or consummation of new business initiatives may be more difficult or expensive than the Company anticipates; there may be difficulties or unanticipated expense incurred in the consummation of new business initiatives or the integration of any acquired entities; and litigation or other matters before regulatory agencies, whether currently existing or commencing in the future, may delay the occurrence or non-occurrence of events longer than the Company anticipates. For discussion of these and other risks that may cause actual results to differ from expectations, please refer to the sections entitled “Forward-Looking Statements” and “Risk Factors” in the Company’s most recent Annual Report on Form 10-K and updates set forth in the Company’s subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.
Contact: Avinash Reddy
Senior Executive Vice President – Chief Financial Officer
718-782-6200 extension 5909DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(In thousands)June 30, March 31, December 31, 2024 2024 2023 Assets: Cash and due from banks $ 413,983 $ 370,852 $ 457,547 Securities available-for-sale, at fair value 819,222 859,216 886,240 Securities held-to-maturity 588,000 589,331 594,639 Loans held for sale 14,766 8,973 10,159 Loans held for investment, net: Business loans (1) 2,530,896 2,327,403 2,310,379 One-to-four family and cooperative/condominium apartment 906,949 873,671 889,236 Multifamily residential and residential mixed-use (2)(3) 3,920,354 3,996,654 4,017,703 Non-owner-occupied commercial real estate 3,315,100 3,386,333 3,381,842 Acquisition, development and construction 144,860 175,352 168,513 Other loans 6,699 5,170 5,755 Allowance for credit losses (77,812 ) (76,068 ) (71,743 ) Total loans held for investment, net 10,747,046 10,688,515 10,701,685 Premises and fixed assets, net 36,054 44,501 44,868 Premises held for sale — — 905 Restricted stock 68,445 74,346 98,750 Bank Owned Life Insurance ("BOLI") 354,761 352,277 349,816 Goodwill 155,797 155,797 155,797 Other intangible assets 4,467 4,753 5,059 Operating lease assets 51,703 51,988 52,729 Derivative assets 134,489 135,162 122,132 Accrued interest receivable 55,588 55,369 55,666 Other assets 104,442 110,012 100,013 Total assets $ 13,548,763 $ 13,501,092 $ 13,636,005 Liabilities: Non-interest-bearing checking (excluding mortgage escrow deposits) $ 3,012,481 $ 2,819,481 $ 2,884,378 Interest-bearing checking 633,721 635,640 515,987 Savings (excluding mortgage escrow deposits) 2,340,222 2,347,114 2,335,354 Money market 3,607,090 3,440,083 3,125,996 Certificates of deposit 1,382,271 1,555,157 1,607,683 Deposits (excluding mortgage escrow deposits) 10,975,785 10,797,475 10,469,398 Non-interest-bearing mortgage escrow deposits 52,647 101,229 61,121 Interest-bearing mortgage escrow deposits 2 173 136 Total mortgage escrow deposits 52,649 101,402 61,257 FHLBNY advances 633,000 773,000 1,313,000 Other short-term borrowings — — — Subordinated debt, net 262,814 200,174 200,196 Derivative cash collateral 130,090 132,900 108,100 Operating lease liabilities 54,530 54,727 55,454 Derivative liabilities 122,567 122,112 121,265 Other liabilities 66,732 79,931 81,110 Total liabilities 12,298,167 12,261,721 12,409,780 Stockholders' equity: Preferred stock, Series A 116,569 116,569 116,569 Common stock 416 416 416 Additional paid-in capital 488,760 492,834 494,454 Retained earnings 826,080 819,130 813,007 Accumulated other comprehensive loss ("AOCI"), net of deferred taxes (82,780 ) (85,466 ) (91,579 ) Unearned equity awards (12,023 ) (10,191 ) (8,622 ) Treasury stock, at cost (86,426 ) (93,921 ) (98,020 ) Total stockholders' equity 1,250,596 1,239,371 1,226,225 Total liabilities and stockholders' equity $ 13,548,763 $ 13,501,092 $ 13,636,005
(1) Business loans include commercial and industrial loans, owner-occupied commercial real estate loans and PPP loans.
(2) Includes loans underlying multifamily cooperatives.
(3) While the loans within this category are often considered "commercial real estate" in nature, multifamily and loans underlying cooperatives are here reported separately from commercial real estate loans in order to emphasize the residential nature of the collateral underlying this significant component of the total loan portfolio.DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands except share and per share amounts)Three Months Ended Six Months Ended June 30, March 31, June 30, June 30, June 30, 2024 2024 2023 2024 2023 Interest income: Loans $ 147,099 $ 143,565 $ 138,310 $ 290,664 $ 266,749 Securities 7,907 7,880 7,914 15,787 16,345 Other short-term investments 4,412 9,564 5,867 13,976 9,669 Total interest income 159,418 161,009 152,091 320,427 292,763 Interest expense: Deposits and escrow 72,878 73,069 52,616 145,947 89,888 Borrowed funds 9,033 14,697 17,759 23,730 33,930 Derivative cash collateral 2,005 1,713 1,497 3,718 2,974 Total interest expense 83,916 89,479 71,872 173,395 126,792 Net interest income 75,502 71,530 80,219 147,032 165,971 Provision (recovery) for credit losses 5,585 5,210 892 10,795 (2,756 ) Net interest income after provision (recovery) 69,917 66,320 79,327 136,237 168,727 Non-interest income: Service charges and other fees 3,972 4,544 4,856 8,516 8,670 Title fees 294 133 246 427 538 Loan level derivative income 1,085 406 2,437 1,491 5,570 BOLI income 2,484 2,461 2,852 4,945 5,015 Gain on sale of Small Business Administration ("SBA") loans 113 253 210 366 726 Gain on sale of residential loans 27 77 34 104 82 Fair value change in equity securities and loans held for sale (416 ) (842 ) (780 ) (1,258 ) (780 ) Net loss on sale of securities — — — — (1,447 ) Gain on sale of other assets 3,695 2,968 — 6,663 — Other 554 467 550 1,021 1,032 Total non-interest income 11,808 10,467 10,405 22,275 19,406 Non-interest expense: Salaries and employee benefits 32,184 32,037 29,900 64,221 56,534 Severance — 42 481 42 506 Occupancy and equipment 7,409 7,368 7,144 14,777 14,517 Data processing costs 4,405 4,313 4,197 8,718 8,435 Marketing 1,637 1,497 1,488 3,134 2,937 Professional services 2,766 1,467 1,676 4,233 3,599 Federal deposit insurance premiums 2,250 2,239 1,874 4,489 3,747 Loss on extinguishment of debt — 453 — 453 — Amortization of other intangible assets 285 307 349 592 726 Other 4,758 2,788 5,077 7,546 8,660 Total non-interest expense 55,694 52,511 52,186 108,205 99,661 Income before taxes 26,031 24,276 37,546 50,307 88,472 Income tax expense 7,552 6,585 10,048 14,137 23,671 Net income 18,479 17,691 27,498 36,170 64,801 Preferred stock dividends 1,822 1,821 1,822 3,643 3,643 Net income available to common stockholders $ 16,657 $ 15,870 $ 25,676 $ 32,527 $ 61,158 Earnings per common share ("EPS"): Basic $ 0.43 $ 0.41 $ 0.66 $ 0.84 $ 1.58 Diluted $ 0.43 $ 0.41 $ 0.66 $ 0.84 $ 1.58 Average common shares outstanding for diluted EPS 38,329,485 38,255,559 38,175,993 38,292,253 38,164,359 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 Six Months Ended June 30, March 31, June 30, June 30, June 30, 2024 2024 2023 2024 2023 Per Share Data: Reported EPS (Diluted) $ 0.43 $ 0.41 $ 0.66 $ 0.84 $ 1.58 Cash dividends paid per common share 0.25 0.25 0.25 0.50 0.49 Book value per common share 28.97 28.84 27.99 28.97 27.99 Tangible common book value per share (1) 24.87 24.72 23.82 24.87 23.82 Common shares outstanding 39,148 38,932 38,803 39,148 38,803 Dividend payout ratio 58.14 % 60.98 % 37.88 % 59.52 % 31.01 % Performance Ratios (Based upon Reported Net Income): Return on average assets 0.55 % 0.51 % 0.81 % 0.53 % 0.96 % Return on average equity 5.88 5.68 9.03 5.78 10.75 Return on average tangible common equity (1) 6.88 6.64 11.04 6.76 13.30 Net interest margin 2.41 2.21 2.50 2.31 2.62 Non-interest expense to average assets 1.66 1.52 1.53 1.59 1.47 Efficiency ratio 63.8 64.0 57.6 63.9 53.8 Effective tax rate 29.01 27.13 26.76 28.10 26.76 Balance Sheet Data: Average assets $ 13,418,441 $ 13,794,924 $ 13,658,068 $ 13,606,682 $ 13,554,483 Average interest-earning assets 12,624,556 13,015,755 12,888,522 12,820,156 12,787,441 Average tangible common equity (1) 979,611 968,719 940,098 974,165 927,616 Loan-to-deposit ratio at end of period (2) 98.2 98.8 103.4 98.2 103.4 Capital Ratios and Reserves - Consolidated: (3) Tangible common equity to tangible assets (1) 7.27 % 7.21 % 6.78 % Tangible equity to tangible assets (1) 8.14 8.09 7.63 Tier 1 common equity ratio 10.06 10.00 9.44 Tier 1 risk-based capital ratio 11.17 11.11 10.50 Total risk-based capital ratio 14.46 13.78 13.06 Tier 1 leverage ratio 8.78 8.48 8.42 Consolidated CRE concentration ratio (4) 499 534 555 Allowance for credit losses/ Total loans 0.72 0.71 0.70 Allowance for credit losses/ Non-performing loans 313.21 218.42 273.42
(1) See "Non-GAAP Reconciliation" tables for reconciliation of tangible equity, tangible common equity, and tangible assets.
(2) Total deposits include mortgage escrow deposits, which fluctuate seasonally.
(3) June 30, 2024 ratios are preliminary pending completion and filing of the Company’s regulatory reports.
(4) The Consolidated CRE concentration ratio is calculated using the sum of commercial real estate, excluding owner-occupied commercial real estate, multifamily, and acquisition, development, and construction, divided by consolidated capital. The June 30, 2024 ratio is 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 June 30, 2024 March 31, 2024 June 30, 2023 Average Average Average Average Yield/ Average Yield/ Average Yield/ Balance Interest Cost Balance Interest Cost Balance Interest Cost Assets: Interest-earning assets: Business loans (1) $ 2,400,219 $ 42,933 7.19 % $ 2,308,319 $ 39,224 6.83 % $ 2,259,769 $ 36,715 6.52 % One-to-four family residential, including condo and coop 886,037 9,968 4.52 886,588 9,770 4.43 828,324 8,661 4.19 Multifamily residential and residential mixed-use 3,958,617 45,775 4.65 4,000,510 46,019 4.63 4,125,119 45,123 4.39 Non-owner-occupied commercial real estate 3,359,004 44,728 5.36 3,371,438 44,776 5.34 3,337,689 42,559 5.11 Acquisition, development, and construction 164,283 3,638 8.91 169,775 3,692 8.75 220,795 5,149 9.35 Other loans 5,100 57 4.50 5,420 84 6.23 6,536 103 6.32 Securities 1,537,487 7,907 2.07 1,578,330 7,880 2.01 1,642,057 7,914 1.93 Other short-term investments 313,809 4,412 5.65 695,375 9,564 5.53 468,233 5,867 5.03 Total interest-earning assets 12,624,556 159,418 5.08 % 13,015,755 161,009 4.98 % 12,888,522 152,091 4.73 % Non-interest-earning assets 793,885 779,169 769,546 Total assets $ 13,418,441 $ 13,794,924 $ 13,658,068 Liabilities and Stockholders' Equity: Interest-bearing liabilities: Interest-bearing checking (2) $ 631,403 $ 1,499 0.95 % $ 582,047 $ 1,223 0.85 % $ 952,424 $ 3,081 1.30 % Money market 3,495,989 33,193 3.82 3,359,884 30,638 3.67 2,713,816 18,284 2.70 Savings (2) 2,336,202 23,109 3.98 2,368,946 22,810 3.87 2,279,670 17,376 3.06 Certificates of deposit 1,393,678 15,077 4.35 1,655,882 18,398 4.47 1,546,257 13,875 3.60 Total interest-bearing deposits 7,857,272 72,878 3.73 7,966,759 73,069 3.69 7,492,167 52,616 2.82 FHLBNY advances 671,242 6,429 3.85 1,094,209 12,143 4.46 1,327,121 15,206 4.60 Subordinated debt, net 202,232 2,604 5.18 200,188 2,553 5.13 200,254 2,553 5.11 Other short-term borrowings — — — 77 1 5.22 814 — — Total borrowings 873,474 9,033 4.16 1,294,474 14,697 4.57 1,528,189 17,759 4.66 Derivative cash collateral 145,702 2,005 5.53 130,166 1,713 5.29 120,542 1,497 4.98 Total interest-bearing liabilities 8,876,448 83,916 3.80 % 9,391,399 89,479 3.83 % 9,140,898 71,872 3.15 % Non-interest-bearing checking (2) 3,042,382 2,909,776 3,043,899 Other non-interest-bearing liabilities 242,980 247,717 254,826 Total liabilities 12,161,810 12,548,892 12,439,623 Stockholders' equity 1,256,631 1,246,032 1,218,445 Total liabilities and stockholders' equity $ 13,418,441 $ 13,794,924 $ 13,658,068 Net interest income $ 75,502 $ 71,530 $ 80,219 Net interest rate spread 1.28 % 1.15 % 1.58 % Net interest margin 2.41 % 2.21 % 2.50 % Deposits (including non-interest-bearing checking accounts) (2) $ 10,899,654 $ 72,878 2.69 % $ 10,876,535 $ 73,069 2.70 % $ 10,536,066 $ 52,616 2.00 %
(1) Business loans include commercial and industrial loans, owner-occupied commercial real estate loans and PPP loans.
(2) Includes mortgage escrow deposits.DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED SCHEDULE OF NON-PERFORMING ASSETS
(Dollars in thousands)At or For the Three Months Ended June 30, March 31, June 30, Asset Quality Detail 2024 2024 2023 Non-performing loans ("NPLs") Business loans (1) $ 20,287 $ 18,213 $ 23,470 One-to-four family residential, including condominium and cooperative apartment 3,884 3,689 3,305 Multifamily residential and residential mixed-use — — — Non-owner-occupied commercial real estate 15 15 15 Acquisition, development, and construction 657 12,910 657 Other loans — — 220 Total Non-accrual loans $ 24,843 $ 34,827 $ 27,667 Total Non-performing assets ("NPAs") $ 24,843 $ 34,827 $ 27,667 Total loans 90 days delinquent and accruing ("90+ Delinquent") $ — $ — $ — NPAs and 90+ Delinquent $ 24,843 $ 34,827 $ 27,667 NPAs and 90+ Delinquent / Total assets 0.18 % 0.26 % 0.20 % Net charge-offs ("NCOs") $ 3,640 $ 739 $ 3,679 NCOs / Average loans (2) 0.14 % 0.03 % 0.14 %
(1) Business loans include commercial and industrial loans, owner-occupied commercial real estate loans and PPP loans.
(2) Calculated based on annualized NCOs to average loans, excluding loans held for sale.DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
NON-GAAP RECONCILIATION
(Dollars in thousands except per share amounts)The following tables below provide a reconciliation of certain financial measures calculated under generally accepted accounting principles ("GAAP") (as reported) and non-GAAP measures. A non-GAAP financial measure is a numerical measure of historical or future financial performance, financial position or cash flows that excludes or includes amounts that are required to be disclosed in the most directly comparable measure calculated and presented in accordance with GAAP in the United States. The Company’s management believes the presentation of non-GAAP financial measures provides investors with a greater understanding of the Company’s operating results in addition to the results measured in accordance with GAAP. While management uses these non-GAAP measures in its analysis of the Company’s performance, this information should not be viewed as a substitute for financial results determined in accordance with GAAP or considered to be more important than financial results determined in accordance with GAAP.
The following non-GAAP financial measures exclude pre-tax income and expenses associated with the fair value change in equity securities and loans held for sale, net (gain) loss on sale of securities and other assets, severance, the FDIC special assessment and loss on extinguishment of debt:
Three Months Ended Six Months Ended June 30, March 31, June 30, June 30, June 30, 2024 2024 2023 2024 2023 Reconciliation of Reported and Adjusted (non-GAAP) Net Income Available to Common Stockholders Reported net income available to common stockholders $ 16,657 $ 15,870 $ 25,676 $ 32,527 $ 61,158 Adjustments to net income (1): Fair value change in equity securities and loans held for sale 416 842 780 1,258 780 Net (gain) loss on sale of securities and other assets (3,695 ) (2,968 ) — (6,663 ) 1,447 Severance — 42 481 42 506 Loss on extinguishment of debt — 453 — 453 — Income tax effect of adjustments 1,043 518 (373 ) 1,561 (809 ) Adjusted net income available to common stockholders (non-GAAP) $ 14,421 $ 14,757 $ 26,564 $ 29,178 $ 63,082 Adjusted Ratios (Based upon Adjusted (non-GAAP) Net Income as calculated above) Adjusted EPS (Diluted) $ 0.37 $ 0.38 $ 0.68 $ 0.75 $ 1.63 Adjusted return on average assets 0.48 % 0.48 % 0.83 % 0.48 % 0.98 % Adjusted return on average equity 5.17 5.32 9.32 5.25 11.06 Adjusted return on average tangible common equity 5.97 6.18 11.42 6.07 13.72 Adjusted non-interest expense to average assets 1.65 1.50 1.51 1.57 1.45 Adjusted efficiency ratio 65.9 64.7 56.2 65.4 52.5
(1) Adjustments to net income are taxed at the Company's approximate statutory tax rate.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 Six Months Ended June 30, March 31, June 30, June 30, June 30, 2024 2024 2023 2024 2023 Operating expense as a % of average assets - as reported 1.66 % 1.52 % 1.53 % 1.59 % 1.47 % Loss on extinguishment of debt — (0.01 ) — (0.01 ) — Severance — — (0.01 ) — (0.01 ) Amortization of other intangible assets (0.01 ) (0.01 ) (0.01 ) (0.01 ) (0.01 ) Adjusted operating expense as a % of average assets (non-GAAP) 1.65 % 1.50 % 1.51 % 1.57 % 1.45 % The following table presents a reconciliation of efficiency ratio (non-GAAP) and adjusted efficiency ratio (non-GAAP):
Three Months Ended Six Months Ended June 30, March 31, June 30, June 30, June 30, 2024 2024 2023 2024 2023 Efficiency ratio - as reported (non-GAAP) (1) 63.8 % 64.0 % 57.6 % 63.9 % 53.8 % Non-interest expense - as reported $ 55,694 $ 52,511 $ 52,186 $ 108,205 $ 99,661 Severance — (42 ) (481 ) (42 ) (506 ) Loss on extinguishment of debt — (453 ) — (453 ) — Amortization of other intangible assets (285 ) (307 ) (349 ) (592 ) (726 ) Adjusted non-interest expense (non-GAAP) $ 55,409 $ 51,709 $ 51,356 $ 107,118 $ 98,429 Net interest income - as reported $ 75,502 $ 71,530 $ 80,219 $ 147,032 $ 165,971 Non-interest income - as reported $ 11,808 $ 10,467 $ 10,405 $ 22,275 $ 19,406 Fair value change in equity securities and loans held for sale 416 842 780 1,258 780 Net (gain) loss on sale of securities and other assets (3,695 ) (2,968 ) — (6,663 ) 1,447 Adjusted non-interest income (non-GAAP) $ 8,529 $ 8,341 $ 11,185 $ 16,870 $ 21,633 Adjusted total revenues for adjusted efficiency ratio (non-GAAP) $ 84,031 $ 79,871 $ 91,404 $ 163,902 $ 187,604 Adjusted efficiency ratio (non-GAAP) (2) 65.9 % 64.7 % 56.2 % 65.4 % 52.5 %
(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):
June 30, March 31, June 30, 2024 2024 2023 Reconciliation of Tangible Assets: Total assets $ 13,548,763 $ 13,501,092 $ 13,802,862 Goodwill (155,797 ) (155,797 ) (155,797 ) Other intangible assets (4,467 ) (4,753 ) (5,758 ) Tangible assets (non-GAAP) $ 13,388,499 $ 13,340,542 $ 13,641,307 Reconciliation of Tangible Common Equity - Consolidated: Total stockholders' equity $ 1,250,596 $ 1,239,371 $ 1,202,503 Goodwill (155,797 ) (155,797 ) (155,797 ) Other intangible assets (4,467 ) (4,753 ) (5,758 ) Tangible equity (non-GAAP) 1,090,332 1,078,821 1,040,948 Preferred stock, net (116,569 ) (116,569 ) (116,569 ) Tangible common equity (non-GAAP) $ 973,763 $ 962,252 $ 924,379 Common shares outstanding 39,148 38,932 38,803 Tangible common equity to tangible assets (non-GAAP) 7.27 % 7.21 % 6.78 % Tangible equity to tangible assets (non-GAAP) 8.14 8.09 7.63 Book value per common share $ 28.97 $ 28.84 $ 27.99 Tangible common book value per share (non-GAAP) 24.87 24.72 23.82 
