Blue Foundry Bancorp Reports Fourth Quarter and Year-End 2023 Results
- The company's capital levels and credit quality remain strong despite challenges in the financial services industry.
- The lending franchise saw growth in higher-yielding commercial loans.
- The company's financial performance showed an increase in non-interest income.
- Gross loans held for investment increased by $15.6 million.
- FHLB borrowings increased by $87.0 million to support loan growth.
- The company reported a net loss of $7.4 million for the year ended December 31, 2023.
- The retail franchise experienced a decrease in total deposits.
- Shareholders' equity decreased by $38.1 million due to share repurchases.
Insights
The reported net loss of Blue Foundry Bancorp for the year ended December 31, 2023, signifies a substantial downturn compared to the previous year's net income. This reversal from profit to loss is a critical indicator of the company's performance and could potentially influence investor sentiment. The decline in net interest margin by 78 basis points year-over-year, alongside the decrease in net interest income, suggests pressure on the bank's core earnings. This pressure may be attributed to the competitive rate environment, which has driven up the cost of interest-bearing deposits more significantly than the yield on interest-earning assets. Additionally, the increase in provisions for credit losses, despite a decrease in non-performing loans, implies a cautious approach to potential future credit risks.
From a balance sheet perspective, the shift in the loan portfolio towards higher-yielding commercial loans indicates a strategic move to enhance earnings potential. However, the decrease in total deposits and the reliance on Federal Home Loan Bank (FHLB) borrowings to support loan growth raises questions about the sustainability of funding sources and liquidity management. The repurchase of shares, despite the net loss, might be seen as a move to signal confidence in the long-term value of the company, but it also reduces shareholders' equity, which can be a point of concern for investors looking at the company's financial resilience.
Blue Foundry Bancorp's performance reflects broader industry challenges faced by banks in 2023, including rate hikes and a slowing economy. The strategic focus on growing the commercial loan portfolio is a response to these challenges, aimed at diversifying revenue streams. However, the reduction in core deposits and the shift towards time deposits may indicate changing customer preferences or a more competitive market for deposit acquisition. This trend could affect the bank's cost of funds and net interest margin in the future.
Market conditions, as indicated by the bank’s President and CEO, have been tough for the banking sector and Blue Foundry's performance must be viewed in this context. The bank's tangible book value per share increase is a positive sign for shareholders, but the overall financial performance and the reported net loss could weigh on the stock's performance in the short term. The bank's focus on executing strategic priorities and prudent balance sheet growth in 2024 will be critical for recovery and will be closely monitored by investors and analysts alike.
The economic environment described by Blue Foundry Bancorp's CEO, characterized by rate hikes and a slowing economy, has significant implications for the banking industry. Banks typically benefit from a widening spread between the interest they earn on loans and the interest they pay on deposits. However, the reported decrease in net interest margin indicates that Blue Foundry Bancorp is experiencing compression in this spread, likely due to higher deposit rates not being fully offset by loan rates. This situation is exacerbated in a competitive rate environment where banks may have to offer higher rates to attract deposits, squeezing margins further.
The bank's strategic shift towards commercial lending is a common response to such conditions, as commercial loans can offer higher yields compared to residential mortgages. However, this strategy also comes with higher risk, particularly in an economic downturn. The bank's capital ratios remaining above the 'well capitalized' standards is a positive sign of financial stability, but the net loss reported could raise concerns about the bank's ability to absorb potential loan losses if economic conditions worsen.
RUTHERFORD, N.J., Jan. 24, 2024 (GLOBE NEWSWIRE) -- Blue Foundry Bancorp (NASDAQ:BLFY) (the “Company”), the holding company for Blue Foundry Bank (the “Bank”), today reported a net loss of
The Company reported a net loss of
James D. Nesci, President and Chief Executive Officer, commented, “2023 proved to be a challenging year for banks as the financial services industry navigated unprecedented rate hikes, large bank failures and a slowing economy. While these factors have adversely affected revenues, our capital levels and credit quality remain strong, and we have been able to manage expenses and bring efficiencies to the institution that should benefit us in years to come.”
He continued, “As we move into 2024, we are focused on executing our strategic priorities which will lead to prudent balance sheet growth, funded through organic deposit acquisition.”
Highlights for the fourth quarter of 2023:
- Non-interest expense, excluding the provision for commitments and letters of credit, decreased
$529 thousand , or4.05% , compared to the same quarter of 2022. - Tangible book value per share increased
$0.25 t o$14.49 from the linked quarter. - Net interest margin decreased ten basis points from the linked quarter and 78 basis points from the fourth quarter of 2022 to
1.84% for the fourth quarter of 2023. - During the quarter, 657,162 shares were repurchased at a weighted average cost of
$8.72 . - Credit metrics remained favorable with nonperforming loans to total loans of 38 basis points.
Lending Franchise
The Company continues to diversify its lending franchise by focusing on growing the higher-yielding commercial portfolio. Although gross loans increased
The details of the loan portfolio are below:
| December 31, 2023 | September 30, 2023 | June 30, 2023 | March 31, 2023 | December 31, 2022 | |||||||||||||||
| (Unaudited) | (Audited) | ||||||||||||||||||
| (In thousands) | |||||||||||||||||||
| Residential one-to-four family | $ | 550,929 | $ | 567,384 | $ | 580,396 | $ | 592,809 | $ | 597,254 | |||||||||
| Multifamily | 682,564 | 689,966 | 696,956 | 695,207 | 690,690 | ||||||||||||||
| Non-residential real estate | 231,720 | 236,325 | 237,247 | 239,844 | 216,061 | ||||||||||||||
| Construction and land | 60,414 | 45,064 | 36,032 | 28,141 | 17,799 | ||||||||||||||
| Junior liens | 22,503 | 22,297 | 21,338 | 19,644 | 18,631 | ||||||||||||||
| Commercial and industrial | 12,553 | 9,904 | 9,743 | 10,357 | 4,653 | ||||||||||||||
| Consumer and other | 47 | 50 | 33 | 58 | 39 | ||||||||||||||
| Total loans | 1,560,730 | 1,570,990 | 1,581,745 | 1,586,060 | 1,545,127 | ||||||||||||||
| Allowance for credit losses on loans | 14,154 | 13,872 | 14,413 | 14,153 | 13,400 | ||||||||||||||
| Loans receivable, net | $ | 1,546,576 | $ | 1,557,118 | $ | 1,567,332 | $ | 1,571,907 | $ | 1,531,727 | |||||||||
Retail Franchise
As of December 31, 2023, total deposits were
The details of deposits are below:
| December 31, 2023 | September 30, 2023 | June 30, 2023 | March 31, 2023 | December 31, 2022 | |||||||||||||||
| (Unaudited) | (Audited) | ||||||||||||||||||
| (In thousands) | |||||||||||||||||||
| Non-interest bearing deposits | $ | 27,739 | $ | 23,787 | $ | 26,067 | $ | 32,518 | $ | 37,907 | |||||||||
| NOW and demand accounts | 361,139 | 378,268 | 404,407 | 427,281 | 410,937 | ||||||||||||||
| Savings | 259,402 | 278,665 | 315,713 | 361,871 | 423,758 | ||||||||||||||
| Core deposits | 648,280 | 680,720 | 746,187 | 821,670 | 872,602 | ||||||||||||||
| Time deposits | 596,624 | 572,384 | 521,074 | 422,911 | 416,260 | ||||||||||||||
| Total deposits | $ | 1,244,904 | $ | 1,253,104 | $ | 1,267,261 | $ | 1,244,581 | $ | 1,288,862 | |||||||||
Financial Performance Overview:
Fourth quarter of 2023 compared to the fourth quarter of 2022
Net interest income compared to the fourth quarter of 2022:
- Net interest income was
$9.2 million , a decrease of$3.7 million . - Net interest margin decreased 78 basis point to
1.84% . - Yield on average interest-earning assets increased 51 basis points to
4.06% . - Cost of average interest-bearing deposits increased 170 basis points to
2.52% , reflecting the competitive rate environment in our primary market. - Average loans increased by
$52.9 million and average interest-bearing deposits increased by$14.7 million .
Non-interest income compared to the fourth quarter of 2022:
- Non-interest income increased
$128 thousand , or28.83% , largely driven by a gain on sale of loans of$72 thousand in the fourth quarter of 2023.
Non-interest expense compared to the fourth quarter of 2022:
- Non-interest expense was
$12.5 million , a decrease of$529 thousand , excluding the provision for commitments and letters of credit, driven by lower compensation and benefit costs and professional services expense of$733 thousand and$207 thousand , respectively, partially offset by increases in occupancy and equipment expense of$231 thousand and data processing expense of$186 thousand . - Since the adoption of the current expected credit loss (CECL) methodology on January 1, 2023, the provision for commitments and letters of credit is recorded in the provision for credit losses. This expense was previously recorded in non-interest expense. During the fourth quarter of 2022, the Company recorded a
$203 thousand release of provision for credit losses on commitments and letters of credit.
Income tax expense compared to the fourth quarter of 2022:
- The Company did not record a tax benefit for the loss incurred during the fourth quarter of 2023 due to the full valuation allowance required on its deferred tax assets. The fourth quarter of 2022 effective tax rate of
22.59% was a result of the taxable income produced during that quarter, partially offset by the ability to utilize a portion of the net operating losses that were fully reserved. - The Company’s current tax position reflects the previously established full valuation allowance on its deferred tax assets. At December 31, 2023, the valuation allowance on deferred tax assets was
$24.0 million .
Year ended December 31, 2023 compared to the year ended December 31, 2022
Net interest income compared to the year ended December 31, 2022:
- Net interest income was
$41.9 million , a decrease of$9.9 million . - Net interest margin decreased by 64 basis points to
2.09% . - Yield on average interest-earning assets increased 66 basis points to
3.94% . - Cost of average interest-bearing deposits increased 150 basis points to
1.97% , due to an increase in higher-cost time deposits and the competitive rate environment in our primary market. - Average loans increased by
$162.1 million and average interest-bearing deposits decreased by$1.9 million .
Non-interest income compared to the year ended December 31, 2022:
- Non-interest income decreased
$859 thousand , or32.24% , largely due to the discontinuation of overdraft charges in 2022, partially offset by a gain on sale of loans of$231 thousand in 2023.
Non-interest expense compared to the year ended December 31, 2022:
- Non-interest expense was
$51.6 million , a decrease of$1.5 million excluding the provision for commitments and letters of credit, driven by a decrease in professional services, compensation and benefits and advertising expenses of$1.1 million ,$808 thousand and$707 thousand , respectively, offset in part by increases in occupancy and equipment, FDIC premiums and data processing expense of$725 thousand ,$418 thousand and$365 thousand , respectively. - As noted in the quarter comparison, the provision for commitments and letters of credit is recorded in the provision for credit losses in 2023. In 2022, the Company recorded a release of the provision for commitments and letters of credit of
$311 thousand .
Income tax expense compared to the year ended December 31, 2022:
- The Company did not record a tax benefit for the loss incurred during 2023 due to the full valuation allowance required on its deferred tax assets. The effective tax rate for 2022 of
12.36% was a result of the taxable income produced during the prior year period, partially offset by the ability to utilize a portion of the net operating losses that were fully reserved. - The Company’s current tax position reflects the previously established full valuation allowance on its deferred tax assets. At December 31, 2023, the valuation allowance on deferred tax assets was
$24.0 million .
Balance Sheet Summary:
December 31, 2023 compared to December 31, 2022
Securities available-for-sale:
- Securities available-for-sale decreased
$30.5 million to$283.8 million due to sales, maturities and calls during the year partially offset by purchases and a$5.5 million improvement in the unrealized loss position on the portfolio. - In the fourth quarter of 2023, the Company sold
$9.3 million of securities available for sale for a net gain of$20 thousand and purchased$15.5 million in higher yielding securities.
Gross loans:
- Gross loans held for investment increased
$15.6 million to$1.56 billion . - Construction loans increased
$42.6 million , non-residential real estate loans increased$15.7 million and commercial and industrial loans increased$7.9 million , while residential and multifamily loans decreased$46.3 million and$8.1 million , respectively. - Originations totaled
$119.6 million , including originations of$35.6 million in construction loans,$27.4 million in non-residential real estate loans and$17.3 million in multifamily loans. In addition, the Company originated$7.8 million of residential mortgage loans and purchased$6.8 million of conforming residential mortgages in New Jersey during the year.
Deposits and borrowings:
- Deposits totaled
$1.24 billion , a decrease of$44.0 million since December 31, 2022. Core deposits represented52.1% of total deposits compared to67.7% at December 31, 2022. - FHLB borrowings increased by
$87.0 million to$397.5 million to support loan growth and offset the decrease in deposits.
Capital:
- Shareholders’ equity decreased by
$38.1 million to$355.6 million . The decrease was primarily driven by the repurchase of shares at a cost of$36.3 million . - The net loss of
$7.4 million was partially offset by$3.8 million in share-based plan activity and a$1.8 million favorable change in accumulated other comprehensive loss. - Tangible equity to tangible assets was
17.37% and19.24% at December 31, 2023 and 2022, respectively. - Tangible common equity per share outstanding was
$14.49 at December 31, 2023 and$14.28 at December 31, 2022. - The Bank’s capital ratios remain above the FDIC’s “well capitalized” standards.
Asset quality:
- Non-performing loans totaled
$5.9 million , or0.38% of total loans at December 31, 2023 compared to$7.8 million , or0.50% of total loans at December 31, 2022. - The allowance for credit losses on loans represented
0.91% of total loans at December 31, 2023 compared to0.87% at December 31, 2022. The allowance for credit losses on loans was239.98% of non-performing loans compared to172.52% at December 31, 2022. - The Company recorded a net provision for credit losses of
$156 thousand for the quarter ended December 31, 2023 and a release of net provision for credit losses of$441 thousand for the year ended December 31, 2023. - Net charge-offs were
$16 thousand and$60 thousand for the quarter and year ended December 31, 2023, respectively.
Off-Balance Sheet:
- To help manage our interest rate position, the Company had
$259.0 million in interest rate hedges at December 31, 2023, with a weighted average duration of 3.2 years and a weighted average rate of2.58% , increasing by$150.0 million from$109.0 million at December 31, 2022
About Blue Foundry
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.
Conference Call Information
A conference call discussing Blue Foundry’s fourth quarter and year ended December 31, 2023 financial results will be held today, Wednesday, January 24, 2024 at 11:00 a.m. (EST). To listen to the live call, please dial 1-833-470-1428 (toll free) and use access code 416218. Participants are encouraged to preregister to listen via webcast at https://events/q4inc.com/attendee/888056143. The conference call will be recorded and will be available on the Company’s website for one month.
Contact:
James D. Nesci
President and Chief Executive Officer
jnesci@bluefoundrybank.com
201-972-8900
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.
| BLUE FOUNDRY BANCORP AND SUBSIDIARY Consolidated Statements of Financial Condition | |||||||||||
| December 31, 2023 | September 30, 2023 | December 31, 2022 | |||||||||
| (Unaudited) | (Unaudited) | (Audited) | |||||||||
| (In thousands) | |||||||||||
| ASSETS | |||||||||||
| Cash and cash equivalents | $ | 46,025 | $ | 52,407 | $ | 41,182 | |||||
| Securities available for sale, at fair value | 283,766 | 283,649 | 314,248 | ||||||||
| Securities held to maturity | 33,254 | 33,298 | 33,705 | ||||||||
| Other investments | 20,346 | 20,515 | 16,069 | ||||||||
| Loans held for sale | — | 2,435 | — | ||||||||
| Loans, net | 1,546,576 | 1,557,118 | 1,531,727 | ||||||||
| Real estate owned, net | 593 | 593 | — | ||||||||
| Interest and dividends receivable | 7,595 | 7,787 | 6,893 | ||||||||
| Premises and equipment, net | 32,475 | 32,031 | 29,825 | ||||||||
| Right-of-use assets | 25,172 | 25,885 | 25,906 | ||||||||
| Bank owned life insurance | 22,034 | 21,919 | 21,576 | ||||||||
| Other assets | 27,127 | 22,939 | 22,207 | ||||||||
| Total assets | $ | 2,044,963 | $ | 2,060,576 | $ | 2,043,338 | |||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||
| Liabilities | |||||||||||
| Deposits | $ | 1,244,904 | $ | 1,253,104 | $ | 1,288,862 | |||||
| Advances from the Federal Home Loan Bank | 397,500 | 402,500 | 310,500 | ||||||||
| Advances by borrowers for taxes and insurance | 8,929 | 9,615 | 9,302 | ||||||||
| Lease liabilities | 26,777 | 27,466 | 27,324 | ||||||||
| Other liabilities | 11,213 | 8,742 | 13,632 | ||||||||
| Total liabilities | 1,689,323 | 1,701,427 | 1,649,620 | ||||||||
| Shareholders’ equity | 355,640 | 359,149 | 393,718 | ||||||||
| Total liabilities and shareholders’ equity | $ | 2,044,963 | $ | 2,060,576 | $ | 2,043,338 | |||||
| BLUE FOUNDRY BANCORP AND SUBSIDIARY Consolidated Statements of Operations (Dollars in thousands except per share data) | |||||||||||||||||||
| Three months ended | Year Ended December 31, | ||||||||||||||||||
| December 31, 2023 | September 30, 2023 | December 31, 2022 | 2023 | 2022 | |||||||||||||||
| (unaudited) | (Unaudited) | (Audited) | |||||||||||||||||
| Interest income: | |||||||||||||||||||
| Loans | $ | 16,907 | $ | 16,728 | $ | 14,487 | $ | 65,685 | $ | 52,279 | |||||||||
| Taxable investment income | 3,327 | 3,339 | 2,971 | 12,990 | 9,678 | ||||||||||||||
| Non-taxable investment income | 101 | 106 | 111 | 430 | 456 | ||||||||||||||
| Total interest income | 20,335 | 20,173 | 17,569 | 79,105 | 62,413 | ||||||||||||||
| Interest expense: | |||||||||||||||||||
| Deposits | 7,755 | 7,034 | 2,482 | 24,116 | 5,738 | ||||||||||||||
| Borrowed funds | 3,384 | 3,263 | 2,160 | 13,070 | 4,832 | ||||||||||||||
| Total interest expense | 11,139 | 10,297 | 4,642 | 37,186 | 10,570 | ||||||||||||||
| Net interest income | 9,196 | 9,876 | 12,927 | 41,919 | 51,843 | ||||||||||||||
| Net provision (release of provision) for credit losses | 156 | (717 | ) | (224 | ) | (441 | ) | (1,001 | ) | ||||||||||
| Net interest income after provision for credit losses | 9,040 | 10,593 | 13,151 | 42,360 | 52,844 | ||||||||||||||
| Non-interest income: | |||||||||||||||||||
| Fees and service charges | 331 | 291 | 341 | 1,164 | 2,156 | ||||||||||||||
| Gain on securities, net | 20 | — | — | 20 | 14 | ||||||||||||||
| Gain on sale of loans | 72 | — | — | 231 | — | ||||||||||||||
| Other income | 149 | 78 | 103 | 390 | 494 | ||||||||||||||
| Total non-interest income | 572 | 369 | 444 | 1,805 | 2,664 | ||||||||||||||
| Non-interest expense: | |||||||||||||||||||
| Compensation and benefits | 6,887 | 6,640 | 7,620 | 28,439 | 29,247 | ||||||||||||||
| Occupancy and equipment | 2,140 | 2,104 | 1,909 | 8,350 | 7,625 | ||||||||||||||
| Data processing | 1,510 | 1,473 | 1,324 | 6,119 | 5,754 | ||||||||||||||
| Advertising | 120 | 85 | 68 | 354 | 1,061 | ||||||||||||||
| Professional services | 631 | 646 | 838 | 3,021 | 4,117 | ||||||||||||||
| Release of provision for commitments and letters of credit | — | — | (203 | ) | — | (311 | ) | ||||||||||||
| Federal deposit insurance premiums | 200 | 263 | 105 | 799 | 381 | ||||||||||||||
| Other expense | 1,055 | 1,183 | 1,208 | 4,480 | 4,900 | ||||||||||||||
| Total non-interest expenses | 12,543 | 12,394 | 12,869 | 51,562 | 52,774 | ||||||||||||||
| (Loss) income before income tax expense | (2,931 | ) | (1,432 | ) | 726 | (7,397 | ) | 2,734 | |||||||||||
| Income tax expense | — | — | 164 | — | 338 | ||||||||||||||
| Net (loss) income | $ | (2,931 | ) | $ | (1,432 | ) | $ | 562 | $ | (7,397 | ) | $ | 2,396 | ||||||
| Basic (loss) earnings per share | $ | (0.13 | ) | $ | (0.06 | ) | $ | 0.02 | $ | (0.31 | ) | $ | 0.09 | ||||||
| Diluted (loss) earnings per share | $ | (0.13 | ) | $ | (0.06 | ) | $ | 0.02 | $ | (0.31 | ) | $ | 0.09 | ||||||
| Weighted average shares outstanding-basic | 22,845,252 | 23,278,490 | 25,713,534 | 23,925,724 | 26,165,841 | ||||||||||||||
| Weighted average shares outstanding-diluted | 22,845,252 | 23,278,490 | 26,013,015 | 23,925,724 | 26,270,864 | ||||||||||||||
| BLUE FOUNDRY BANCORP AND SUBSIDIARY Consolidated Financial Highlights (Dollars in thousands except for share data) (Unaudited) | |||||||||||||||||||
| Three months ended | |||||||||||||||||||
| December 31, 2023 | September 30, 2023 | June 30, 2023 | March 31, 2023 | December 31, 2022 | |||||||||||||||
| Performance Ratios (%) | |||||||||||||||||||
| (Loss) return on average assets | (0.57 | ) | (0.27 | ) | (0.35 | ) | (0.24 | ) | 0.11 | ||||||||||
| (Loss) return on average equity | (3.25 | ) | (1.55 | ) | (1.95 | ) | (1.25 | ) | 0.56 | ||||||||||
| Interest rate spread (1) | 1.33 | 1.48 | 1.75 | 2.05 | 2.35 | ||||||||||||||
| Net interest margin (2) | 1.84 | 1.94 | 2.17 | 2.42 | 2.62 | ||||||||||||||
| Efficiency ratio (non-GAAP) (3) | 128.41 | 120.98 | 114.90 | 109.92 | 97.76 | ||||||||||||||
| Average interest-earning assets to average interest-bearing liabilities | 122.93 | 123.05 | 130.77 | 126.39 | 128.30 | ||||||||||||||
| Tangible equity to tangible assets (4) | 17.37 | 17.07 | 17.59 | 18.33 | 19.24 | ||||||||||||||
| Book value per share (5) | $ | 14.51 | $ | 14.27 | $ | 14.38 | $ | 14.08 | $ | 14.30 | |||||||||
| Tangible book value per share (5) | $ | 14.49 | $ | 14.24 | $ | 14.35 | $ | 14.06 | $ | 14.28 | |||||||||
| Asset Quality | |||||||||||||||||||
| Non-performing loans | $ | 5,898 | $ | 6,139 | $ | 7,736 | $ | 7,481 | $ | 7,767 | |||||||||
| Real estate owned, net | 593 | 593 | — | — | — | ||||||||||||||
| Non-performing assets | $ | 6,491 | $ | 6,732 | $ | 7,736 | $ | 7,481 | $ | 7,767 | |||||||||
| Allowance for credit losses on loans to total loans (%) | 0.91 | 0.88 | 0.91 | 0.89 | 0.87 | ||||||||||||||
| Allowance for credit losses on loans to non-performing loans (%) | 239.98 | 225.97 | 186.31 | 189.18 | 172.52 | ||||||||||||||
| Non-performing loans to total loans (%) | 0.38 | 0.39 | 0.49 | 0.47 | 0.50 | ||||||||||||||
| Non-performing assets to total assets (%) | 0.32 | 0.33 | 0.37 | 0.36 | 0.38 | ||||||||||||||
| Net charge-offs to average outstanding loans during the period (%) | — | 0.01 | — | — | (0.01 | ) | |||||||||||||
| (1) | Interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities. |
| (2) | Net interest margin represents net interest income divided by average interest-earning assets. |
| (3) | Efficiency ratio represents adjusted non-interest expense divided by the sum of net interest income plus non-interest income. |
| (4) | Tangible equity equals |
| (5) | Per share metrics are computed using 24,509,950 total shares outstanding. |
| BLUE FOUNDRY BANCORP AND SUBSIDIARY Analysis of Net Interest Income (Unaudited) | |||||||||||||||||||||||||||
| Three Months Ended | |||||||||||||||||||||||||||
| December 31, 2023 | September 30, 2023 | December 31, 2022 | |||||||||||||||||||||||||
| Average Balance | Interest | Average Yield/Cost | Average Balance | Interest | Average Yield/Cost | Average Balance | Interest | Average Yield/Cost | |||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||||||
| Loans (1) | $ | 1,564,800 | $ | 16,907 | 4.29 | % | $ | 1,577,173 | $ | 16,728 | 4.21 | % | $ | 1,511,941 | $ | 14,487 | 3.80 | % | |||||||||
| Mortgage-backed securities | 165,471 | 904 | 2.17 | % | 170,326 | 840 | 1.96 | % | 187,213 | 1,092 | 2.31 | % | |||||||||||||||
| Other investment securities | 190,507 | 1,486 | 3.09 | % | 194,953 | 1,507 | 3.07 | % | 200,013 | 1,425 | 2.83 | % | |||||||||||||||
| FHLB stock | 20,970 | 477 | 9.02 | % | 21,047 | 456 | 8.60 | % | 17,225 | 216 | 4.96 | % | |||||||||||||||
| Cash and cash equivalents | 45,895 | 561 | 4.85 | % | 51,884 | 642 | 4.91 | % | 44,718 | 349 | 3.10 | % | |||||||||||||||
| Total interest-bearing assets | 1,987,643 | 20,335 | 4.06 | % | 2,015,383 | 20,173 | 3.97 | % | 1,961,110 | 17,569 | 3.55 | % | |||||||||||||||
| Non-interest earning assets | 54,918 | 58,042 | 52,258 | ||||||||||||||||||||||||
| Total assets | $ | 2,042,561 | $ | 2,073,425 | $ | 2,013,368 | |||||||||||||||||||||
| Liabilities and shareholders' equity: | |||||||||||||||||||||||||||
| NOW, savings, and money market deposits | $ | 634,257 | 1,989 | 1.24 | % | $ | 684,228 | 2,123 | 1.23 | % | $ | 848,199 | 1,636 | 0.77 | % | ||||||||||||
| Time deposits | 584,977 | 5,766 | 3.91 | % | 558,252 | 4,911 | 3.49 | % | 356,377 | 846 | 0.94 | % | |||||||||||||||
| Interest-bearing deposits | 1,219,234 | 7,755 | 2.52 | % | 1,242,480 | 7,034 | 2.25 | % | 1,204,576 | 2,482 | 0.82 | % | |||||||||||||||
| FHLB advances | 397,643 | 3,384 | 3.38 | % | 395,359 | 3,263 | 3.27 | % | 323,903 | 2,160 | 2.65 | % | |||||||||||||||
| Total interest-bearing liabilities | 1,616,877 | 11,139 | 2.73 | % | 1,637,839 | 10,297 | 2.49 | % | 1,528,479 | 4,642 | 1.20 | % | |||||||||||||||
| Non-interest bearing deposits | 26,629 | 25,540 | 42,144 | ||||||||||||||||||||||||
| Non-interest bearing other | 41,780 | 44,628 | 47,746 | ||||||||||||||||||||||||
| Total liabilities | 1,685,286 | 1,708,007 | 1,618,369 | ||||||||||||||||||||||||
| Total shareholders' equity | 357,275 | 365,418 | 394,999 | ||||||||||||||||||||||||
| Total liabilities and shareholders' equity | $ | 2,042,561 | $ | 2,073,425 | $ | 2,013,368 | |||||||||||||||||||||
| Net interest income | $ | 9,196 | $ | 9,876 | $ | 12,927 | |||||||||||||||||||||
| Net interest rate spread (2) | 1.33 | % | 1.48 | % | 2.35 | % | |||||||||||||||||||||
| Net interest margin (3) | 1.84 | % | 1.94 | % | 2.62 | % | |||||||||||||||||||||
| (1) | Average loan balances are net of deferred loan fees and costs, and premiums and discounts, and include non-accrual loans. |
| (2) | Net interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities. |
| (3) | Net interest margin represents net interest income divided by average interest-earning assets. |
| BLUE FOUNDRY BANCORP AND SUBSIDIARY Analysis of Net Interest Income continued (Unaudited) | ||||||||||||||||||
| Year Ended December 31, | ||||||||||||||||||
| 2023 | 2022 | |||||||||||||||||
| Average Balance | Interest | Average Yield/Cost | Average Balance | Interest | Average Yield/Cost | |||||||||||||
| (Dollar in thousands) | ||||||||||||||||||
| Assets: | ||||||||||||||||||
| Loans (1) | $ | 1,569,590 | $ | 65,685 | 4.18 | % | $ | 1,407,502 | $ | 52,279 | 3.71 | % | ||||||
| Mortgage-backed securities | 172,405 | 3,693 | 2.14 | % | 190,540 | 3,934 | 2.06 | % | ||||||||||
| Other investment securities | 195,754 | 6,010 | 3.07 | % | 203,002 | 4,820 | 2.37 | % | ||||||||||
| FHLB stock | 21,249 | 1,582 | 7.45 | % | 12,629 | 587 | 4.65 | % | ||||||||||
| Cash and cash equivalents | 46,245 | 2,135 | 4.62 | % | 88,703 | 793 | 0.89 | % | ||||||||||
| Total interest-bearing assets | 2,005,243 | 79,105 | 3.94 | % | 1,902,376 | 62,413 | 3.28 | % | ||||||||||
| Non-interest earning assets | 56,297 | 64,786 | ||||||||||||||||
| Total assets | $ | 2,061,540 | $ | 1,967,162 | ||||||||||||||
| Liabilities and shareholders' equity: | ||||||||||||||||||
| NOW, savings, and money market deposits | $ | 722,149 | 8,339 | 1.15 | % | $ | 812,473 | 2,959 | 0.36 | % | ||||||||
| Time deposits | 501,124 | 15,777 | 3.15 | % | 412,734 | 2,779 | 0.67 | % | ||||||||||
| Interest-bearing deposits | 1,223,273 | 24,116 | 1.97 | % | 1,225,207 | 5,738 | 0.47 | % | ||||||||||
| FHLB advances | 396,265 | 13,070 | 3.30 | % | 235,589 | 4,832 | 2.05 | % | ||||||||||
| Total interest-bearing liabilities | 1,619,538 | 37,186 | 2.30 | % | 1,460,796 | 10,570 | 0.72 | % | ||||||||||
| Non-interest bearing deposits | 25,227 | 44,029 | ||||||||||||||||
| Non-interest bearing other | 43,868 | 47,707 | ||||||||||||||||
| Total liabilities | 1,688,633 | 1,552,532 | ||||||||||||||||
| Total shareholders' equity | 372,907 | 414,630 | ||||||||||||||||
| Total liabilities and shareholders' equity | $ | 2,061,540 | $ | 1,967,162 | ||||||||||||||
| Net interest income | $ | 41,919 | $ | 51,843 | ||||||||||||||
| Net interest rate spread (2) | 1.64 | % | 2.56 | % | ||||||||||||||
| Net interest margin (3) | 2.09 | % | 2.73 | % | ||||||||||||||
| (1) | Average loan balances are net of deferred loan fees and costs, and premiums and discounts, and include non-accrual loans. |
| (2) | Net interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities. |
| (3) | Net interest margin represents net interest income divided by average interest-earning assets. |
| BLUE FOUNDRY BANCORP AND SUBSIDIARY Adjusted Pre-Provision Net Revenue (Non-GAAP) (Dollars in thousands except per share data) (Unaudited) |
This press release contains certain supplemental financial information, described in the table below, which has been determined by methods other than U.S. Generally Accepted Accounting Principles ("GAAP") that management uses in its analysis of Blue Foundry's performance. Management believes these non-GAAP financial measures provide information useful to investors in understanding Blue Foundry's financial results. These non-GAAP measures should not be considered a substitute for GAAP basis measures and results and Blue Foundry strongly encourages investors to review its consolidated financial statements in their entirety and not to rely on any single financial measure. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names.
Net income, as presented in the Consolidated Statements of Operations, includes the provision for loan losses, provision for commitments and letters of credit, and income tax expense while pre-provision net revenue does not.
| Three months ended | ||||||||||||||||||||
| December 31, 2023 | September 30, 2023 | June 30, 2023 | March 31, 2023 | December 31, 2022 | ||||||||||||||||
| Pre-provision net revenue (PPNR) and efficiency ratio, as adjusted: | ||||||||||||||||||||
| Net interest income | $ | 9,196 | $ | 9,876 | $ | 10,906 | $ | 11,941 | $ | 12,927 | ||||||||||
| Other income | 572 | 369 | 380 | 484 | 444 | |||||||||||||||
| 9,768 | 10,245 | 11,286 | 12,425 | 13,371 | ||||||||||||||||
| Operating expenses, as reported | 12,543 | 12,394 | 12,968 | 13,657 | 12,869 | |||||||||||||||
| Less: | ||||||||||||||||||||
| Loss on assets held for sale | — | — | — | — | (203 | ) | ||||||||||||||
| Operating expenses, as adjusted | 12,543 | 12,394 | 12,968 | 13,657 | 13,072 | |||||||||||||||
| Pre-provision net (loss) revenue, as adjusted | $ | (2,775 | ) | $ | (2,149 | ) | $ | (1,682 | ) | $ | (1,232 | ) | $ | 299 | ||||||
| Efficiency ratio | 128.4 | % | 121.0 | % | 114.9 | % | 109.9 | % | 97.8 | % | ||||||||||
| Core deposits: | ||||||||||||||||||||
| Total deposits | $ | 1,244,904 | $ | 1,253,104 | $ | 1,267,261 | $ | 1,244,581 | $ | 1,288,862 | ||||||||||
| Less: time deposits | 596,624 | 572,384 | 521,074 | 422,911 | 416,260 | |||||||||||||||
| Core deposits | $ | 648,280 | $ | 680,720 | $ | 746,187 | $ | 821,670 | $ | 872,602 | ||||||||||
| Core deposits to total deposits | 52.1 | % | 54.3 | % | 58.9 | % | 66.0 | % | 67.7 | % | ||||||||||
| Tangible equity: | ||||||||||||||||||||
| Shareholders’ equity | $ | 355,640 | $ | 359,149 | $ | 366,534 | $ | 385,693 | $ | 393,718 | ||||||||||
| Less: intangible assets | 557 | 644 | 730 | 781 | 798 | |||||||||||||||
| Tangible equity | $ | 355,083 | $ | 358,505 | $ | 365,804 | $ | 384,912 | $ | 392,920 | ||||||||||
| Tangible book value per share: | ||||||||||||||||||||
| Tangible equity | $ | 355,083 | $ | 358,505 | $ | 365,804 | $ | 384,912 | $ | 392,920 | ||||||||||
| Shares outstanding | 24,509,950 | 25,174,412 | 25,493,422 | 27,385,482 | 27,523,219 | |||||||||||||||
| Tangible book value per share | $ | 14.49 | $ | 14.24 | $ | 14.35 | $ | 14.06 | $ | 14.28 | ||||||||||
FAQ
What was Blue Foundry Bancorp's net loss for the year ended December 31, 2023?
What was the change in gross loans held for investment?
What was the change in FHLB borrowings?
What was the change in total deposits for the retail franchise?
What was the change in shareholders' equity?
