Blue Foundry Bancorp Announces Adoption of Fourth Stock Repurchase Program

Rhea-AI Summary

Blue Foundry Bancorp (BLFY) announced a new stock repurchase program to buy back up to 1,203,545 shares, approximately 5% of its outstanding common stock. This is the fourth program since its mutual-to-stock conversion in July 2021. The company has repurchased 5,409,022 shares since its first program. The new program will start after completing the third one. The repurchase can be done through various methods based on market conditions and the company's financial performance.

Insights

Financial Analyst

The announcement of Blue Foundry Bancorp's new share repurchase program represents a significant financial move that could have multiple implications for the company's capital structure and shareholder value. Share repurchases are often interpreted as a signal that a company's leadership believes the stock is undervalued. By reducing the number of outstanding shares, the earnings per share (EPS) metric can be positively impacted, potentially leading to a higher stock price. However, this maneuver also means that the company is choosing to allocate capital to buy back shares rather than investing in new projects or business expansion, which could be seen as a lack of growth opportunities.

From a financial perspective, this action may also indicate that Blue Foundry Bancorp is generating sufficient cash flow, enabling it to return capital to shareholders. However, it's essential to monitor the company's balance sheet to ensure that these repurchases are not being financed through excessive debt, which could undermine financial stability. The timing and volume of repurchases will be critical to watch, as they can affect the market's perception and the actual stock price.

Market Research Analyst

Blue Foundry Bancorp's decision to implement a fourth stock repurchase program could reflect broader market trends where companies use buybacks as a tool to manage their stock price and provide returns to investors. In the context of the banking sector, where growth can often be slow and steady, repurchase programs can be particularly attractive to investors looking for regular returns on their investments. It's also indicative of the company's confidence in its financial health and future prospects.

Investors and analysts will be interested in how these buybacks correlate with the company's stock performance history since its mutual-to-stock conversion. The repurchase of 5% of outstanding common stock is a non-trivial amount that could tighten the supply of shares in the market, potentially leading to a short-term price increase. However, the long-term effects will largely depend on the company's ongoing financial performance and market conditions.

Legal Expert

The share repurchase program will be conducted in compliance with SEC Rule 10b5-1 and Rule 10b-18, which provide a regulatory framework for such transactions. Rule 10b5-1 allows insiders of publicly traded corporations to set up a trading plan for selling stocks they own, while Rule 10b-18 provides a 'safe harbor' for companies to repurchase their shares without being deemed to manipulate the market. These regulations are designed to ensure that the repurchases are executed in a manner that does not artificially inflate the stock price or mislead investors.

It's important that Blue Foundry Bancorp follows these guidelines meticulously to maintain transparency and investor confidence. Any deviation or perceived manipulation could result in significant legal consequences and damage to the company's reputation. As such, the legal framework surrounding this repurchase plan is as critical as the financial implications and the company's adherence to these rules will be closely scrutinized by regulators and investors alike.

RUTHERFORD, N.J., Feb. 27, 2024 (GLOBE NEWSWIRE) -- Blue Foundry Bancorp (NASDAQ: BLFY), the holding company for Blue Foundry Bank, announced that it has adopted a program to repurchase up to 1,203,545 shares of its common stock, which is approximately 5% of its outstanding common stock. This is the Company’s fourth stock repurchase program since completing its mutual-to-stock conversion and related stock offering in July 2021.

Since announcing its first stock repurchase program on July 20, 2022, the Company has repurchased 5,409,022 shares. As of February 26, 2024, there were 46,736 shares remaining to be repurchased under the third plan. The fourth plan will commence immediately upon the completion of the third plan.

The repurchase program permits shares to be repurchased in open market or private transactions, through block trades or pursuant to any trading plan that may be adopted in accordance with Rule 10b5-1 of the Securities and Exchange Commission. The timing and amount of any repurchases will depend on a number of factors, including the availability of stock, general market conditions, the trading price of the stock, alternative uses for capital, and the Company’s financial performance. Open market purchases will be made in accordance with Rule 10b-18 of the Securities and Exchange Commission and other applicable legal requirements. The Company is not obligated to repurchase any particular number of shares or any shares in any specific time period.

James D. Nesci, President and CEO of the Company, remarked that “We are pleased to announce our fourth repurchase program. We believe that share repurchases are a prudent use of capital and are pleased to have the strong capital position that allows us the ability to purchase stock.”

About Blue Foundry Bancorp

Blue Foundry Bancorp is the holding company for Blue Foundry Bank, a place where things are made, purpose is formed, and ideas are crafted. Headquartered in Rutherford NJ, with a presence in Bergen, Essex, Hudson, Middlesex, Morris, Passaic, Somerset and Union counties, Blue Foundry Bank is a full-service, innovative bank serving the doers, movers, and shakers in our communities. We offer individuals and businesses alike the tailored products and services they need to build their futures. With a rich history dating back more than 145 years, Blue Foundry Bank has a longstanding commitment to its customers and communities. To learn more about Blue Foundry Bank visit BlueFoundryBank.com or call (888) 931-BLUE. Member FDIC.

Forward Looking Statements

Certain statements contained herein are 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”) and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements, which are based on certain current assumptions and describe our future plans, strategies and expectations, can generally be identified by the use of the words “may,” “will,” “should,” “could,” “would,” “plan,” “potential,” “estimate,” “project,” “believe,” “intend,” “anticipate,” “expect,” “target” and similar expressions.

Forward-looking statements are based on current beliefs and expectations of management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statements: inflation and changes in the interest rate environment that reduce our margins and yields, the fair value of financial instruments or our level of loan originations, or increase the level of defaults, losses and prepayments on loans we have made and make; general economic conditions, either nationally or in our market areas, that are worse than expected; changes in the level and direction of loan delinquencies and write-offs and changes in estimates of the adequacy of the allowance for credit losses; our ability to access cost-effective funding; fluctuations in real estate values and both residential and commercial real estate market conditions; demand for loans and deposits in our market area; our ability to implement and change our business strategies; competition among depository and other financial institutions; the effects of the recent turmoil in the banking industry (including the failures of two financial institutions); adverse changes in the securities or secondary mortgage markets; changes in laws or government regulations or policies affecting financial institutions, including changes in regulatory fees, capital requirements and insurance premiums; changes in monetary or fiscal policies of the U.S. Government, including policies of the U.S. Treasury and the Federal Reserve Board; changes in the quality or composition of our loan or investment portfolios; technological changes that may be more difficult or expensive than expected; a failure or breach of our operational or security systems or infrastructure, including cyber-attacks; the inability of third party providers to perform as expected; our ability to manage market risk, credit risk and operational risk in the current economic environment; our ability to enter new markets successfully and capitalize on growth opportunities; our ability to successfully integrate into our operations any assets, liabilities, customers, systems and management personnel we may acquire and our ability to realize related revenue synergies and cost savings within expected time frames and any goodwill charges related there to; changes in consumer spending, borrowing and savings habits; changes in accounting policies and practices, as may be adopted by the bank regulatory agencies, the Financial Accounting Standards Board, the Securities and Exchange Commission or the Public Company Accounting Oversight Board; our ability to retain key employees; the current or anticipated impact of military conflict, terrorism or other geopolitical events; the impact of potential government shutdown; the ability of the U.S. Government to manage federal debt limits; and changes in the financial condition, results of operations or future prospects of issuers of securities that we own.

Because of these and other uncertainties, our actual future results may be materially different from the results indicated by these forward-looking statements. Except as required by applicable law or regulation, we do not undertake, and we specifically disclaim any obligation, to release publicly the results of any revisions that may be made to any forward-looking statements to reflect events or circumstances after the date of the statements or to reflect the occurrence of anticipated or unanticipated events.

Contact Information

Elyse D. Beidner
Investor Relations
BlueFoundryBank.com
ebeidner@bluefoundrybank.com
201-939-5000

FAQ

How many shares will Blue Foundry Bancorp repurchase under the new program?

Blue Foundry Bancorp will repurchase up to 1,203,545 shares under the new program.

How many shares has Blue Foundry Bancorp repurchased since its first program?

Blue Foundry Bancorp has repurchased 5,409,022 shares since its first program.

When did Blue Foundry Bancorp complete its mutual-to-stock conversion and related stock offering?

Blue Foundry Bancorp completed its mutual-to-stock conversion and related stock offering in July 2021.

Who is the President and CEO of Blue Foundry Bancorp?

James D. Nesci is the President and CEO of Blue Foundry Bancorp.

What factors will determine the timing and amount of repurchases?

The timing and amount of repurchases will depend on factors like stock availability, market conditions, trading price of the stock, alternative capital uses, and the company's financial performance.