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NFBK: Northfield Bancorp Reports Q2 2023 Earnings, Declares Dividend. Net income of $9.6 million, diluted EPS of $0.22. Net interest margin decreased by 29 basis points. Loans held-for-investment increased by $32.1 million. Share repurchase program authorized. New branch in Elizabeth, NJ. Cash dividend declared of $0.13 per share.
Positive
Net income of $9.6 million, diluted EPS of $0.22 for Q2 2023.
Loans held-for-investment increased by $32.1 million, or 3.0% annualized.
Share repurchase program authorized, new branch in Elizabeth, NJ.
Cash dividend declared of $0.13 per share.
Negative
Net interest margin decreased by 29 basis points to 2.34%.
Total deposits (excluding brokered) decreased by $102.5 million, or 2.8%.
NOTABLE ITEMS FOR THE QUARTER INCLUDE:
DILUTED EARNINGS PER SHARE WERE $0.22 FOR THE CURRENT QUARTER AS COMPARED TO $0.26 FOR THE TRAILING QUARTER, AND $0.34 FOR THE SECOND QUARTER OF 2022.
NET INTEREST MARGIN DECREASED BY 29 BASIS POINTS TO 2.34% FOR THE CURRENT QUARTER AS COMPARED TO 2.63% FOR THE TRAILING QUARTER, AND BY 69 BASIS POINTS COMPARED TO 3.03% FOR THE SECOND QUARTER OF 2022.
LOANS HELD-FOR-INVESTMENT INCREASED BY $32.1 MILLION, OR 3.0% ANNUALIZED, FROM MARCH 31, 2023, PRIMARILY IN MULTIFAMILY AND COMMERCIAL REAL ESTATE.
CREDIT QUALITY REMAINS STRONG WITH NON-PERFORMING LOANS TO TOTAL LOANS AT 0.24% AS COMPARED TO 0.22% AT MARCH 31, 2023.
TOTAL DEPOSITS (EXCLUDING BROKERED) DECREASED FOR THE CURRENT QUARTER BY $102.5 MILLION, OR 2.8%:
COST OF DEPOSITS WAS 113 BASIS POINTS FOR THE CURRENT QUARTER AS COMPARED TO 79 BASIS POINTS FOR THE TRAILING QUARTER.
DIVERSIFIED DEPOSIT BASE (EXCLUDING BROKERED DEPOSITS) AT JUNE 30, 2023:
RETAIL DEPOSITS APPROXIMATE 55%
BUSINESS DEPOSITS APPROXIMATE 28%
GOVERNMENTAL DEPOSITS APPROXIMATE 17%
AVERAGE DEPOSIT BALANCE IS $36,000
ADDITIONAL COLLATERALIZED BORROWING CAPACITY ESTIMATED AT APPROXIMATELY $1.3 BILLION.
THE COMPANY REINSTATED SHARE REPURCHASES ON MAY 1, 2023, AND ON JUNE 1, 2023, AUTHORIZED A NEW $10.0 MILLION SHARE REPURCHASE PROGRAM. THE COMPANY REPURCHASED 1.3 MILLION SHARES FOR A COST OF $13.3 MILLION DURING THE QUARTER.
NORTHFIELD BANK RECENTLY EXECUTED A LEASE AGREEMENT FOR A NEW BRANCH IN ELIZABETH, NJ, EXPECTED TO OPEN IN THE FALL OF 2023.
CASH DIVIDEND DECLARED OF $0.13 PER SHARE OF COMMON STOCK, PAYABLE AUGUST 23, 2023, TO STOCKHOLDERS OF RECORD AS OF AUGUST 9, 2023.
WOODBRIDGE, N.J., , July 26, 2023 (GLOBE NEWSWIRE) -- NORTHFIELD BANCORP, INC. (Nasdaq:NFBK) (the “Company”), the holding company for Northfield Bank, reported net income of $9.6 million, or $0.22 per diluted share (including severance cost of $440,000, or $0.01, per share), for the three months ended June 30, 2023, as compared to $11.7 million, or $0.26 per diluted share, for the three months ended March 31, 2023, and $15.9 million, or $0.34 per diluted share, for the three months ended June 30, 2022. For the six months ended June 30, 2023, net income totaled $21.3 million, or $0.48 per diluted share (including severance cost of $440,000, or $0.01, per share), compared to $30.0 million, or $0.64 per diluted share, for the six months ended June 30, 2022. The decrease in net income for both the current quarter and six months ended June 30, 2023, as compared to the trailing quarter and comparable prior year periods, was primarily the result of a decrease in net interest income which was negatively impacted by higher funding costs.
Commenting on the quarter, Steven M. Klein, the Company’s Chairman, President and Chief Executive Officer stated, “The Northfield team continued to successfully manage through the challenges presented by elevated market interest rates and an inverted yield curve. During the quarter we remained focused on managing our cost of funds and net interest margin, while meeting the lending and deposit needs of our customers.” Mr. Klein continued, “We delivered solid financial performance during the quarter by prudently increasing our loan portfolio, maintaining strong asset quality, and managing our cost of deposits. While significant risks remain, including recession uncertainty, as well as inflation and interest rate movements, we will continue to prudently manage our strong capital and liquidity and focus on our Locally Grown approach to community commercial banking.”
Mr. Klein further noted, “I am pleased to announce that the Board of Directors has declared a cash dividend of $0.13 per common share, payable August 23, 2023, to stockholders of record on August 9, 2023.”
Results of Operations
Comparison of Operating Results for the Six Months Ended June 30, 2023 and 2022
Net income was $21.3 million and $30.0 million for the six months ended June 30, 2023 and June 30, 2022, respectively. Significant variances from the comparable prior year period are as follows: a $10.9 million decrease in net interest income, a $3.7 million increase in non-interest income, a $4.5 million increase in non-interest expense, and a $3.3 million decrease in income tax expense.
Net interest income for the six months ended June 30, 2023, decreased $10.9 million, or 14.2%, to $66.1 million, from $77.0 million for the six months ended June 30, 2022. The decrease in net interest income was primarily attributable to a $28.8 million increase in interest expense on deposits, borrowings and subordinated debt, partially offset by a $17.9 million increase in interest income. The increase in interest income was primarily due to a $103.9 million, or 2.0%, increase in the average balance of interest-earning assets coupled with a 61 basis point increase in yields on interest-earning assets due to the rising rate environment and a greater percentage of assets consisting of higher-yielding loans. The increase in the average balance of interest-earning assets was due to increases in the average balance of loans outstanding of $344.1 million and the average balance of Federal Home Loan Bank of New York (“FHLBNY”) stock of $19.6 million, partially offset by decreases in the average balance of mortgage-backed securities of $193.9 million, the average balance of interest-earning deposits in financial institutions of $46.4 million, and the average balance of other securities of $19.5 million. The increase in interest expense on deposits, borrowings and subordinated debt was largely driven by a $199.1 million, or 5.3%, increase in the average balance of interest-bearing liabilities, including increases of $486.2 million and $56.4 million, in average borrowed funds and subordinated debt, respectively, partially offset by a $343.4 million decrease in average interest-bearing deposits coupled with the impact of rising market interest rates.
Net interest margin decreased by 47 basis point to 2.48% from 2.95% for the six months ended June 30, 2022. The decrease in net interest margin was primarily due to the cost of interest-bearing liabilities increasing faster than the repricing of interest-earning assets. The cost of interest-bearing liabilities increased by 144 basis points to 1.80% for the six months ended June 30, 2023, from 0.36% for the six months ended June 30, 2022, driven primarily by a 149 basis point increase in the cost of borrowings from 2.07% to 3.56% for the six months ended June 30, 2023. Additionally, the cost of interest-bearing deposits increased by 106 basis points from 0.15% to 1.21% for the six months ended June 30, 2023, due to rising market interest rates and a shift in the composition of the deposit portfolio towards higher-costing certificates of deposit. The increase in the cost of interest-bearing liabilities was partially offset by an increase in yields on interest-earning assets which increased 61 basis points to 3.82% for the six months ended June 30, 2023, from 3.21% for the six months ended June 30, 2022. The Company accreted interest income related to purchased credit-deteriorated (“PCD”) loans of $678,000 for the six months ended June 30, 2023, as compared to $729,000 for the six months ended June 30, 2022. Fees recognized from Paycheck Protection Program (“PPP”) loans totaled $29,000 for the six months ended June 30, 2023, as compared to $1.1 million for the six months ended June 30, 2022. Net interest income for the six months ended June 30, 2023, included loan prepayment income of $1.2 million as compared to $2.6 million for the six months ended June 30, 2022.
The provision for credit losses on loans increased by $342,000 to $894,000 for the six months ended June 30, 2023, compared to $552,000 for the six months ended June 30, 2022. The increase in the provision for credit losses for the current period, as compared to the comparable prior year period, was primarily the result of a weakening macroeconomic outlook, higher net charge-offs, and an increase in reserves for commercial and industrial loans primarily due to a $13.8 million loan that is current and collateralized by receivables and business assets being downgraded to substandard, partially offset by a decrease in non-economic qualitative loss factors in the multifamily and commercial real estate portfolios and decreased loan growth. Net charge-offs were $2.4 million for the six months ended June 30, 2023, as compared to net charge-offs of $494,000 for the six months ended June 30, 2022, the increase being due to charge-offs on small business unsecured commercial and industrial loans. Management continues to monitor the small business unsecured commercial and industrial loan portfolio which totaled $41.4 million at June 30, 2023.
Non-interest income increased by $3.7 million, or 148.1%, to $6.1 million for the six months ended June 30, 2023, from $2.5 million for the six months ended June 30, 2022, due primarily to a $3.4 million increase in mark to market gains on trading securities, net, and a $478,000 increase in other income, which was primarily an increase in swap fee income. For the six months ended June 30, 2023, gains on trading securities were $1.0 million, as compared to losses of $2.4 million for the six months ended June 30, 2022. The trading portfolio is utilized to fund the Company’s deferred compensation obligation to certain employees and directors of the Company's deferred compensation plan (the “Plan”). The participants of this Plan, at their election, defer a portion of their compensation. Gains and losses on trading securities have a minimal effect on net income since participants benefit from, and bear the full risk of, changes in the trading securities market values. Therefore, the Company records an equal and offsetting amount in compensation expense, reflecting the change in the Company’s obligations under the Plan. Partially offsetting the increases was a decrease of $281,000 in net realized gains on available-for-sale debt securities.
Non-interest expense increased $4.5 million, or 12.0%, to $41.9 million for the six months ended June 30, 2023, compared to $37.4 million for the six months ended June 30, 2022. The increase was primarily due to a $4.5 million increase in employee compensation and benefits, attributable to a $3.4 million increase in the mark to market of the Company's deferred compensation plan expense, which as discussed above has no effect on net income, coupled with an increase in equity award expense related to awards issued in the first quarter of 2023, annual merit increases, and severance expense of $440,000, partially offset by a decrease in the accrual for incentive compensation. During the second quarter of 2023, due to current economic conditions, the Company implemented a workforce reduction plan which included modest layoffs and the elimination of, and/or not filling, certain open positions. The annual estimated cost savings of this plan is $1.4 million, pre-tax. Data processing expense increased by $839,000, due to continued investments in technology, increased transaction costs related to an increase in the number of customer accounts and related volume of transactions, and higher pricing effective January 2023. Advertising expense increased by $583,000 due to the timing of certain programs and new promotions on deposit products. FDIC insurance expense increased by $460,000 due to higher assessments. Partially offsetting the increases was a decrease of $1.2 million in credit loss (benefit)/expense for off-balance sheet credit exposures, and a $274,000 decrease in other operating expense. The decrease in credit loss expense for off-balance sheet credit exposures was due to a benefit of $550,000 recorded during the six months ended June 30, 2023, compared to a provision of $628,000 for the prior year period, attributed to a decrease in the pipeline of loans committed and awaiting closing.
The Company recorded income tax expense of $8.1 million for the six months ended June 30, 2023, compared to $11.5 million for the six months ended June 30, 2022, with the decrease due to lower taxable income. The effective tax rate for the six months ended June 30, 2023, was 27.7% compared to 27.6% for the six months ended June 30, 2022.
Comparison of Operating Results for the Three Months Ended June 30, 2023 and 2022
Net income was $9.6 million and $15.9 million for the quarters ended June 30, 2023 and June 30, 2022, respectively. Significant variances from the comparable prior year quarter are as follows: an $8.9 million decrease in net interest income, a $2.1 million increase in non-interest income, a $2.1 million increase in non-interest expense, and a $2.5 million decrease in income tax expense.
Net interest income for the quarter ended June 30, 2023, decreased $8.9 million, or 22.3%, to $31.2 million, from $40.1 million for the quarter ended June 30, 2022. The decrease in net interest income was primarily attributable to a $17.1 million increase in interest expense on deposits, borrowings and subordinated debt, partially offset by an $8.2 million increase in interest income. The increase in interest income was primarily due to an increase in average interest-earning assets of $33.8 million, or 0.6%, coupled with a 59 basis point increase in yields on interest-earning assets due to the rising rate environment and a greater percentage of assets consisting of higher-yielding loans. The increase in the average balance of interest-earning assets was primarily due to increases in the average balance of loans outstanding of $292.1 million and the average balance of FHLBNY stock of $23.2 million, partially offset by decreases in the average balance of mortgage-backed securities of $196.1 million, the average balance of other securities of $58.6 million, and the average balance of interest-earning deposits in financial institutions of $26.9 million. The increase in interest expense on deposits, borrowings and subordinated debt was largely driven by a $172.0 million, or 4.5%, increase in the average balance of interest-bearing liabilities, including increases of $626.6 million and $51.5 million, in average borrowed funds and subordinated debt, respectively, partially offset by a $506.1 million decrease in average interest-bearing deposits coupled with the impact of rising market interest rates.
Net interest margin decreased by 69 basis points to 2.34% for the quarter ended June 30, 2023, from 3.03% for the quarter ended June 30, 2022, primarily due to the cost of interest-bearing liabilities increasing faster than the repricing of interest-earning assets. The cost of interest-bearing liabilities increased by 170 basis points to 2.05% for the quarter ended June 30, 2023, from 0.35% for the quarter ended June 30, 2022, driven primarily by a 164 basis point increase in the cost of borrowings from 2.04% to 3.68% for the quarter ended June 30, 2023. Additionally, the cost of interest-bearing deposits increased by 127 basis points from 0.16% to 1.43% for the quarter ended June 30, 2023, due to rising market interest rates and a shift in the composition of the deposit portfolio towards higher-yielding certificates of deposit. The increase in the cost of interest-bearing liabilities was partially offset by an increase in yields on interest-earning assets which increased by 59 basis points to 3.88% for the quarter ended June 30, 2023, from 3.29% for the quarter ended June 30, 2022. Net interest income for the quarter ended June 30, 2023, included loan prepayment income of $194,000, as compared to $1.5 million for the quarter ended June 30, 2022. The Company accreted interest income related to PCD loans of $337,000 for the quarter ended June 30, 2023, as compared to $339,000 for quarter ended June 30, 2022. Fees recognized from PPP loans totaled $24,000 for the quarter ended June 30, 2023, as compared to $432,000 for the quarter ended June 30, 2022.
The provision for credit losses on loans decreased by $119,000 to a provision of $30,000 for the quarter ended June 30, 2023, from a provision of $149,000 for the quarter ended June 30, 2022. The decrease in the current quarter provision for credit losses was primarily due to minimal loan growth and a decrease in non-economic qualitative loss factors in the multifamily and commercial real estate portfolios, partially offset by a worsening macroeconomic outlook and an increase in reserves for commercial and industrial loans, primarily due to a $13.8 million loan that is current and collateralized by receivables and business assets being downgraded to substandard. Net charge-offs were $313,000 for the quarter ended June 30, 2023, compared to net charge-offs of $392,000 for the quarter ended June 30, 2022.
Non-interest income increased by $2.1 million, or 268.1%, to $2.8 million for the quarter ended June 30, 2023, from $765,000 for the quarter ended June 30, 2022, primarily due to a $2.1 million increase in gains on trading securities. For the quarter ended June 30, 2023, gains on trading securities, net, were $506,000, compared to losses of $1.6 million in the comparative prior year quarter. Gains and losses on trading securities have a minimal effect on net income since participants benefit from, and bear the full risk of, changes in the trading securities market values.
Non-interest expense increased by $2.1 million, or 11.0%, to $20.8 million for the quarter ended June 30, 2023, from $18.7 million for the quarter ended June 30, 2022. The increase was primarily due to a $2.9 million increase in compensation and employee benefits, primarily attributable to a $2.1 million increase in the mark to market of the Company's deferred compensation plan expense, which as discussed above has no effect on net income, and, to a lesser extent, an increase in salary expense related to annual merit increases and severance expense of $440,000. Data processing expense increased by $309,000 due to continued investments in technology. Advertising expense increased by $169,000 due to the timing of certain programs and new promotions on demand deposit products. FDIC insurance expense increased by $213,000 due to higher assessments. Partially offsetting the increases was a $1.0 million decrease in the credit loss (benefit)/expense for off-balance sheet exposures, and a $461,000 decrease in professional fees. The decrease in credit loss (benefit)/expense for off-balance sheet credit exposures was due to a benefit of $661,000 recorded during the quarter ended June 30, 2023, compared to a provision of $349,000 for the prior year period, attributed to a decrease in the pipeline of loans committed and awaiting closing. The decrease in professional fees was due to higher audit and recruiting fees in the prior year.
The Company recorded income tax expense of $3.6 million for the quarter ended June 30, 2023, compared to $6.1 million for the quarter ended June 30, 2022, with the decrease due to lower taxable income. The effective tax rate for the quarter ended June 30, 2023 was 27.4%, compared to 27.8% for the quarter ended June 30, 2022.
Comparison of Operating Results for the Three Months Ended June 30, 2023 and March 31, 2023
Net income was $9.6 million and $11.7 million for the quarters ended June 30, 2023, and March 31, 2023, respectively. Significant variances from the prior quarter are as follows: a $3.7 million decrease in net interest income, an $834,000 decrease in the provision for credit losses on loans, a $516,000 decrease in non-interest income, a $353,000 decrease in non-interest expense and a $916,000 decrease in income tax expense.
Net interest income for the quarter ended June 30, 2023, decreased by $3.7 million, or 10.7%, to $31.2 million, from $34.9 million for the quarter ended March 31, 2023. The decrease in net interest income was primarily attributable to a $5.5 million increase in interest expense on deposits and borrowings, partially offset by a $1.7 million increase in interest income. The increase in interest income was primarily due to a 12 basis point increase in yields on interest-earning assets, partially offset by a $43.5 million, or 0.8%, decrease in the average balance of interest-earning assets. The decrease in the average balance of interest-earning assets was primarily due to decreases in the average balance of mortgage-backed securities of $43.3 million, the average balance of other securities of $36.7 million, and the average balance of interest-earning deposits in financial institutions of $9.4 million, partially offset by increases in the average balance of loans outstanding of $40.1 million and the average balance of FHLBNY stock of $5.8 million. The increase in interest expense on deposits and borrowings was largely driven by a $33.0 million, or 0.8%, increase in the average balance of interest-bearing liabilities, including an increase of $240.7 million in average borrowed funds, coupled with the impact of rising market interest rates, partially offset by a $207.8 million decrease in average interest-bearing deposits .
Net interest margin decreased by 29 basis points to 2.34% from 2.63% for the quarter ended March 31, 2023. The decrease was primarily due to the increase in the cost of interest-bearing liabilities outpacing the increase in yields on interest-earning assets. The cost of interest-bearing liabilities increased by 52 basis point to 2.05% for the quarter ended June 30, 2023, from 1.53% for the quarter ended March 31, 2023, driven by both higher costs of deposits and borrowed funds, reflective of the rising interest rate environment, and was partially offset by higher yields on interest-earning assets, which increased by 12 basis points to 3.88% for the quarter ended June 30, 2023, from 3.76% for the quarter ended March 31, 2023, due to rising market interest rates and a greater percentage of assets consisting of higher-yielding loans. Net interest income for the quarter ended June 30, 2023, included loan prepayment income of $194,000 as compared to $961,000 for the quarter ended March 31, 2023. The Company accreted interest income related to PCD loans of $337,000 for the quarter ended June 30, 2023, as compared to $341,000 for the quarter ended March 31, 2023.
The provision for credit losses on loans decreased by $834,000 to $30,000 for the quarter ended June 30, 2023, from $864,000 for the quarter ended March 31, 2023. The decrease in the provision was primarily attributable to lower net charge-offs, and a decrease in non-economic qualitative loss factors in the multifamily and commercial real estate portfolios, partially offset by an increase in reserves for commercial and industrial loans. Net charge-offs were $313,000 for the quarter ended June 30, 2023, as compared to net charge-offs of $2.0 million for the quarter ended March 31, 2023.
Non-interest income decreased by $516,000, or 15.5%, to $2.8 million for the quarter ended June 30, 2023, from $3.3 million for the quarter ended March 31, 2023. The decrease was primarily due to a $474,000 decrease in other income caused by higher swap fee income in the prior quarter, and a $71,000 decrease in fees and service charges for customer services, partially offset by an increase of $35,000 in gains on sales of loans for the current quarter.
Non-interest expense decreased by $353,000, or 1.7%, to $20.8 million for the quarter ended June 30, 2023, from $21.1 million for the quarter ended March 31, 2023. The decrease was primarily due to a $772,000 decrease in the credit loss (benefit)/expense for off-balance sheet exposures due to a benefit of $661,000 recorded during the quarter ended June 30, 2023, compared to a provision of $111,000 for the quarter ended March 31, 2023, a decrease in advertising expense of $274,000, a decrease in professional fees of $203,000, a decrease in data processing costs of $172,000, and a decrease in occupancy expense of $128,000. Partially offsetting the decreases was a $1.3 million increase in compensation and employee benefits, primarily related to annual merit increases which were effective February 27, 2023, and severance expense of $440,000.
The Company recorded income tax expense of $3.6 million for the quarter ended June 30, 2023, compared to $4.5 million for the quarter ended March 31, 2023 with the decrease due to lower taxable income. The effective tax rate for the quarter ended June 30, 2023 was 27.4%, compared to 27.9% for the quarter ended and March 31, 2023.
Financial Condition
Total assets decreased by $60.5 million, or 1.1%, to $5.54 billion at June 30, 2023, from $5.60 billion at December 31, 2022. The decrease was primarily due to a decrease in available-for-sale debt securities of $149.9 million, or 15.7%, partially offset by increases in cash and cash equivalents of $43.3 million, or 94.6%, loans receivable of $31.3 million, or 0.7%, FHLBNY stock of $10.0 million, or 32.9%, and other assets of $3.1 million, or 5.7%.
As of June 30, 2023, our non-owner occupied commercial real estate loans (as defined by regulatory guidance) to total risk-based capital was estimated by us at approximately 469%. Management believes that Northfield Bank (the “Bank”) has implemented appropriate risk management practices including risk assessments, board-approved underwriting policies and related procedures, which include monitoring Bank portfolio performance, performing market analysis (economic and real estate), and stressing of the Bank’s commercial real estate portfolio under severe, adverse economic conditions. Although management believes the Bank has implemented appropriate policies and procedures to manage its commercial real estate concentration risk, the Bank’s regulators could require it to implement additional policies and procedures or could require it to maintain higher levels of regulatory capital, which might adversely affect its loan originations, the Company's ability to pay dividends, and overall profitability.
Cash and cash equivalents increased by $43.3 million, or 94.6%, to $89.1 million at June 30, 2023, from $45.8 million at December 31, 2022, primarily due to an increase in Federal Reserve Bank of New York (“FRB”) balances driven by excess cash from borrowings. Balances fluctuate based on the timing of receipt of security and loan repayments and the redeployment of cash into higher-yielding assets such as loans and securities, or the funding of deposit outflows or borrowing maturities. For the six months ended June 30, 2023, Management believed it was prudent to increase balance sheet liquidity given general market volatility and uncertainty.
Loans held-for-investment, net, increased by $30.3 million, or 0.7%, to $4.27 billion at June 30, 2023 from $4.24 billion at December 31, 2022, primarily due to an increase in commercial real estate loans, partially offset by decreases in multifamily loans and commercial and industrial loans. The Company continues to focus on the credit needs of its customers, and to a lesser extent, the development of new business given the uncertain economic environment. Commercial real estate loans increased $43.7 million, or 4.9%, to $943.0 million at June 30, 2023 from $899.2 million at December 31, 2022, home equity loans increased $6.0 million, or 3.9%, to $158.5 million at June 30, 2023 from $152.6 million at December 31, 2022, and construction and land loans increased $4.5 million, or 18.1%, to $29.4 million at June 30, 2023 from $24.9 million at December 31, 2022. The increases were partially offset by decreases in multifamily loans of $9.8 million, or 0.3%, to $2.81 billion at June 30, 2023 from $2.82 billion at December 31, 2022, one-to-four family residential loans of $3.2 million, or 1.8%, to $170.8 million at June 30, 2023 from $173.9 million at December 31, 2022, and commercial and industrial loans of $11.4 million, or 7.4%, to $143.3 million at June 30, 2023 from $154.7 million at December 31, 2022.
At June 30, 2023, office-related loans represented $213.3 million, or approximately 5% of our total loan portfolio, with an average balance of $1.7 million (although we have originated these type of loans in amounts substantially greater than this average) and a weighted average loan-to-value ratio of 58%. Approximately 46% were owner-occupied. The geographic locations of the properties collateralizing our office-related loans are as follows: 53.2% in New York, 46.5% in New Jersey and 0.3% in Pennsylvania. At June 30, 2023, our largest office-related loan had a principal balance of $85.0 million (with a net active principal balance for the Bank of $28.3 million as we have a 33.3% participation interest), was secured by an office facility located in Staten Island, New York, and was performing in accordance with its original contractual terms.
PCD loans totaled $11.5 million at June 30, 2023 and December 31, 2022, respectively. The majority of the remaining PCD loan balance consists of loans acquired as part of a Federal Deposit Insurance Corporation-assisted transaction. The Company accreted interest income of $337,000 and $678,000 attributable to PCD loans for the three and six months ended June 30, 2023, respectively, as compared to $339,000 and $729,000 for the three and six months ended June 30, 2022, respectively. PCD loans had an allowance for credit losses of approximately $3.7 million at June 30, 2023.
Loan balances are summarized as follows (dollars in thousands):
June 30, 2023
March 31, 2023
December 31, 2022
Real estate loans:
Multifamily
$
2,814,809
$
2,800,079
$
2,824,579
Commercial mortgage
942,980
919,503
899,249
One-to-four family residential mortgage
170,767
175,640
173,946
Home equity and lines of credit
158,517
155,683
152,555
Construction and land
29,444
25,508
24,932
Total real estate loans
4,116,517
4,076,413
4,075,261
Commercial and industrial loans
142,948
146,751
149,557
PPP loans
366
5,081
5,143
Other loans
2,663
2,095
2,230
Total commercial and industrial, PPP, and other loans
145,977
153,927
156,930
Loans held-for-investment, net (excluding PCD)
4,262,494
4,230,340
4,232,191
PCD loans
11,548
11,591
11,502
Total loans held-for-investment, net
$
4,274,042
$
4,241,931
$
4,243,693
The Company’s available-for-sale debt securities portfolio decreased by $149.9 million, or 15.7%, to $802.3 million at June 30, 2023, from $952.2 million at December 31, 2022. The decrease was primarily attributable to paydowns, maturities and calls. At June 30, 2023, $614.6 million of the portfolio consisted of residential mortgage-backed securities issued or guaranteed by Fannie Mae, Freddie Mac, or Ginnie Mae. In addition, the Company held $72.1 million in U.S. Government agency securities and $115.6 million in corporate bonds, all of which were considered investment grade at June 30, 2023. Unrealized losses, net of tax, on available-for-sale debt securities and held-to-maturity securities approximated $45.3 million and $326,000, respectively, at June 30, 2023, and $48.6 million and $332,000, respectively, at December 31, 2022.
Equity securities were $10.7 million at June 30, 2023 and $10.4 million at December 31, 2022. Equity securities are primarily comprised of an investment in a Small Business Administration Loan Fund. This investment is utilized by the Bank as part of its Community Reinvestment Act program.
Total liabilities decreased $45.7 million, or 0.9%, to $4.85 billion at June 30, 2023, from $4.90 billion at December 31, 2022. The decrease was primarily attributable to a decrease in total deposits of $385.8 million, partially offset by an increase in FHLB advances and other borrowings of $339.7 million. The Company routinely utilizes brokered deposits and borrowed funds to manage interest rate risk, the cost of interest bearing liabilities, and funding needs related to loan originations and deposit activity.
Deposits decreased $385.8 million, or 9.3%, to $3.76 billion at June 30, 2023, as compared to $4.15 billion at December 31, 2022. Brokered deposits decreased by $218.6 million, or 56.0%. Deposits, excluding brokered deposits, decreased $167.2 million, or 4.4%. The decrease in deposits, excluding brokered deposits, was attributable to decreases of $114.5 million in transaction accounts and $198.6 million in money market accounts. These decreases were partially offset by increases of $132.8 million in time deposits and $13.0 million in savings accounts. Estimated uninsured deposits (excluding fully collateralized uninsured governmental deposits of $617.4 million) were approximately $827.8 million, or 22%, of total deposits as of June 30, 2023.
Deposit account balances are summarized as follows (dollars in thousands):
June 30, 2023
March 31, 2023
December 31, 2022
Transaction:
Non-interest bearing checking
$
754,498
$
804,784
$
852,660
Negotiable orders of withdrawal and interest-bearing checking
1,116,000
1,109,364
1,132,290
Total transaction
1,870,498
1,914,148
1,984,950
Savings and money market:
Savings
930,198
926,541
917,180
Money market
309,475
398,730
508,067
Total savings
1,239,673
1,325,271
1,425,247
Certificates of deposit:
Brokered deposits
171,448
152,049
390,035
$250,000 and under
420,518
327,341
293,200
Over $250,000
62,266
128,688
56,787
Total certificates of deposit
654,232
608,078
740,022
Total deposits
$
3,764,403
$
3,847,497
$
4,150,219
Included in the table above are business and municipal deposit account balances as follows (dollars in thousands):
June 30, 2023
March 31, 2023
December 31, 2022
Business customers
$
993,298
$
1,071,469
$
1,146,803
Municipal (governmental) customers
$
595,322
$
609,662
$
604,717
Borrowed funds increased to $984.6 million at June 30, 2023, from $644.9 million at December 31, 2022. The increase in borrowings for the period was due to an increase in FHLB and FRB borrowings of $339.7 million, including $134.5 million of borrowings under the Federal Reserve Bank Term Funding Program which included favorable terms and conditions as compared to FHLB advances. Management utilizes borrowings to mitigate interest rate risk, for short-term liquidity, and to a lesser extent from time to time, as part of leverage strategies. During the six months ended June 30, 2023, the Company increased borrowings to pay off higher-rate brokered certificates of deposit, and, to a lesser extent, fund deposit outflows of non-brokered deposits.
The following table sets forth borrowing maturities (excluding overnight borrowings and subordinated debt) and the weighted average rate by year at June 30, 2023 (dollars in thousands):
Year
Amount (1)
Weighted Average Rate
2023
$65,000
3.88%
2024
194,500
3.98%
2025
182,500
2.59%
2026
148,000
4.36%
2027
173,000
3.19%
Thereafter
154,288
3.96%
$917,288
3.61%
(1) Borrowings maturing in 2023 and 2024 include $40.0 million and $94.5 million, respectively, of FRB borrowings that can be repaid without any penalty.
Total stockholders’ equity decreased by $14.7 million to $686.6 million at June 30, 2023, from $701.4 million at December 31, 2022. The decrease was attributable to $29.3 million in stock repurchases and $11.7 million in dividend payments, partially offset by net income of $21.3 million for the six months ended June 30, 2023, a $3.3 million increase in accumulated other comprehensive income associated with an increase in the estimated fair value of our debt securities available-for-sale portfolio, and a $1.7 million increase in equity award activity. During the six months ended June 30, 2023, the Company repurchased approximately 2.4 million of its common stock outstanding at an average price of $12.42 for a total of $29.3 million pursuant to approved stock repurchase plans. As of June 30, 2023, the Company had approximately $3.2 million in remaining capacity under its current repurchase program.
The Company's most liquid assets are cash and cash equivalents, corporate bonds, and unpledged mortgage-related securities issued or guaranteed by the U.S. Government, Fannie Mae, or Freddie Mac, that we can either borrow against or sell. We also have the ability to surrender bank-owned life insurance contracts. The surrender of these contracts would subject the Company to income taxes and penalties for increases in the cash surrender values over the original premium payments. We also have the ability to obtain additional funding from the FHLB and Federal Reserve Bank of New York utilizing unencumbered and unpledged securities and multifamily loans. The Company expects to have sufficient funds available to meet current commitments in the normal course of business.
The Company had the following primary sources of liquidity at June 30, 2023 (dollars in thousands):
Cash and cash equivalents(1)
$
75,274
Corporate bonds(2)
$
102,555
Multifamily loans(2)
$
1,124,293
Mortgage-backed securities (issued or guaranteed by the U.S. Government, Fannie Mae, or Freddie Mac)(2)
$
72,704
(1) Excludes $13.9 million of cash at Northfield Bank.
The Company and the Bank utilize the Community Bank Leverage Ratio (“CBLR”) framework. The CBLR replaces the risk-based and leverage capital requirements in the generally applicable capital rules. At June 30, 2023, the Company and the Bank's estimated CBLR ratios were 12.46% and 12.54%, respectively, which exceeded the minimum requirement to be considered well-capitalized of 9%.
Asset Quality
The following table details total non-accrual loans (excluding PCD), non-performing loans, non-performing assets, troubled debt restructurings on which interest is accruing, and accruing loans 30 to 89 days delinquent at June 30, 2023, March 31, 2023, and December 31, 2022 (dollars in thousands):
June 30, 2023
March 31, 2023
December 31, 2022
Non-accrual loans:
Held-for-investment
Real estate loans:
Multifamily
$
3,223
$
3,258
$
3,285
Commercial
5,393
5,188
5,184
One-to-four family residential
109
113
118
Home equity and lines of credit
100
78
262
Commercial and industrial
1,275
532
964
Other
10
—
—
Total non-accrual loans
10,110
9,169
9,813
Loans delinquent 90 days or more and still accruing:
Held-for-investment
Real estate loans:
Multifamily
218
225
233
Commercial
—
—
8
One-to-four family residential
6
6
155
PPP loans
—
—
24
Other
—
—
5
Total loans held-for-investment delinquent 90 days or more and still accruing
224
231
425
Total non-performing loans
10,334
9,400
10,238
Other real estate owned
—
70
—
Total non-performing assets
$
10,334
$
9,470
$
10,238
Non-performing loans to total loans
0.24
%
0.22
%
0.24
%
Non-performing assets to total assets
0.19
%
0.17
%
0.18
%
Loans subject to restructuring agreements and still accruing (1)
$
—
$
—
$
3,751
Accruing loans 30 to 89 days delinquent
$
4,076
$
4,073
$
3,644
(1) With the adoption of Accounting Standards Update (“ASU”) 2022-02, Financial Instruments - Credit Losses (Topic 326) Troubled Debt Restructurings and Vintage Disclosures (“ASU 2022-02”), effective January 1, 2023, TDR accounting has been eliminated.
The increase in non-accrual loans during the quarter ended June 30, 2023, was primarily due to an increase in small business unsecured commercial and industrial loans being placed on non-accrual status.
Other Real Estate Owned
At June 30, 2023 and December 31, 2022, the Company had no assets acquired through foreclosure. At March 31, 2023, other real estate owned was comprised of one property located in New Jersey, which had a carrying value of approximately $70,000, and which was sold during the second quarter of 2023 for a small loss.
Accruing Loans 30 to 89 Days Delinquent
Loans 30 to 89 days delinquent and on accrual status totaled $4.1 million, $4.1 million, and $3.6 million at June 30, 2023, March 31, 2023, and December 31, 2022, respectively. The following table sets forth delinquencies for accruing loans by type and by amount at June 30, 2023, March 31, 2023 and December 31, 2022 (dollars in thousands):
June 30, 2023
March 31, 2023
December 31, 2022
Held-for-investment
Real estate loans:
Multifamily
$
—
$
185
$
189
Commercial
803
804
900
One-to-four family residential
567
567
672
Home equity and lines of credit
256
665
830
Commercial and industrial loans
2,450
1,842
1,048
Other loans
—
10
5
Total delinquent accruing loans held-for-investment
$
4,076
$
4,073
$
3,644
The increase in the commercial and industrial loan delinquencies was primarily due to an increase in delinquencies in unsecured small business loans. Unsecured small business loans totaled $41.4 million, $39.6 million, and $43.3 million at June 30, 2023, March 31, 2023 and December 31, 2022, respectively. Management continues to monitor the small business unsecured commercial and industrial loan portfolio.
PCD Loans (Held-for-Investment)
The Company accounts for PCD loans at estimated fair value using discounted expected future cash flows deemed to be collectible on the date acquired. Based on its detailed review of PCD loans and experience in loan workouts, management believes it has a reasonable expectation about the amount and timing of future cash flows and accordingly has classified PCD loans ($11.5 million at June 30, 2023 and December 31, 2022, respectively) as accruing, even though they may be contractually past due. At June 30, 2023, 5.2% of PCD loans were past due 30 to 89 days, and 29.7% were past due 90 days or more, as compared to 6.8% and 23.0%, respectively, at December 31, 2022.
About Northfield Bank
Northfield Bank, founded in 1887, operates 38 full-service banking in Staten Island and Brooklyn, New York, and Hunterdon, Middlesex, Mercer, and Union counties, New Jersey. For more information about Northfield Bank, please visit www.eNorthfield.com.
Forward-Looking Statements: This release may contain certain "forward looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, and may be identified by the use of such words as "may," "believe," "expect," "anticipate," "should," "plan," "estimate," "predict," "continue," and "potential" or the negative of these terms or other comparable terminology. Examples of forward-looking statements include, but are not limited to, estimates with respect to the financial condition, results of operations and business of Northfield Bancorp, Inc. Any or all of the forward-looking statements in this release and in any other public statements made by Northfield Bancorp, Inc. may turn out to be wrong. They can be affected by inaccurate assumptions Northfield Bancorp, Inc. might make or by known or unknown risks and uncertainties as described in our SEC filings, including, but not limited to, those related to general economic conditions, particularly in the market areas in which the Company operates, including any potential recessionary conditions, changes in liquidity, including the size and composition of our deposit portfolio, including the percentage of uninsured deposits in the portfolio, the effects of the COVID-19 pandemic, including the effects of the steps taken to address the pandemic and their impact on the Company’s market and employees, competition among depository and other financial institutions, including with respect to overdraft and other fees, changes in laws or government regulations or policies affecting financial institutions, including changes in the monetary policies of the U.S. Treasury and the Board of Governors of the Federal Reserve System, changes in regulatory fees, assessments and capital requirements, inflation and changes in the interest rate environment that reduce our margins, reduce the fair value of financial instruments or reduce our ability to originate loans, the effects of war, conflict, and acts of terrorism, our ability to successfully integrate acquired entities, and adverse changes in the securities markets. Consequently, no forward-looking statement can be guaranteed. Northfield Bancorp, Inc. does not intend to update any of the forward-looking statements after the date of this release, or conform these statements to actual events.
(Tables follow)
NORTHFIELD BANCORP, INC. SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA (Dollars in thousands, except per share amounts) (unaudited)
At or For the Three Months Ended
At or For the Six Months Ended
June 30,
March
June 30,
2023
2022
2023
2023
2022
Selected Financial Ratios:
Performance Ratios (1)
Return on assets (ratio of net income to average total assets)
0.69
%
1.14
%
0.84
%
0.77
%
1.09
%
Return on equity (ratio of net income to average equity)
5.52
8.92
6.82
6.16
8.37
Average equity to average total assets
12.44
12.81
12.39
12.42
13.07
Interest rate spread
1.83
2.94
2.23
2.02
2.85
Net interest margin
2.34
3.03
2.63
2.48
2.95
Efficiency ratio (2)
61.14
45.81
55.27
58.03
47.11
Non-interest expense to average total assets
1.49
1.35
1.52
1.51
1.36
Non-interest expense to average total interest-earning assets
1.56
1.41
1.59
1.58
1.44
Average interest-earning assets to average interest-bearing liabilities
133.31
138.40
135.51
134.39
138.71
Asset Quality Ratios:
Non-performing assets to total assets
0.19
0.19
0.17
0.19
0.19
Non-performing loans (3) to total loans (4)
0.24
0.25
0.22
0.24
0.25
Allowance for credit losses to non-performing loans
398.24
372.65
440.81
398.24
372.65
Allowance for credit losses to total loans held-for-investment, net (5)
0.96
0.95
0.98
0.96
0.95
(1)
Annualized where appropriate.
(2)
The efficiency ratio represents non-interest expense divided by the sum of net interest income and non-interest income.
(3)
Non-performing loans consist of non-accruing loans and loans 90 days or more past due and still accruing (excluding PCD loans), and are included in total loans held-for-investment, net.
(4)
Includes originated loans held-for-investment, PCD loans, acquired loans and loans held-for-sale.
(5)
Includes originated loans held-for-investment, PCD loans, and acquired loans.
NORTHFIELD BANCORP, INC. CONSOLIDATED BALANCE SHEETS (Dollars in thousands, except share and per share amounts) (unaudited)
June 30, 2023
March 31, 2023
December 31, 2022
ASSETS:
Cash and due from banks
$
13,853
$
14,490
$
14,530
Interest-bearing deposits in other financial institutions
75,274
144,462
31,269
Total cash and cash equivalents
89,127
158,952
45,799
Trading securities
11,731
11,129
10,751
Debt securities available-for-sale, at estimated fair value
802,257
896,948
952,173
Debt securities held-to-maturity, at amortized cost
10,316
10,378
10,760
Equity securities
10,653
10,443
10,443
Loans held-for-sale
977
—
—
Loans held-for-investment, net
4,274,042
4,241,931
4,243,693
Allowance for credit losses
(41,154
)
(41,436
)
(42,617
)
Net loans held-for-investment
4,232,888
4,200,495
4,201,076
Accrued interest receivable
17,721
17,196
17,426
Bank-owned life insurance
169,671
168,782
167,912
Federal Home Loan Bank of New York stock, at cost
40,376
41,117
30,382
Operating lease right-of-use assets
32,010
33,120
34,288
Premises and equipment, net
24,573
24,674
24,844
Goodwill
41,012
41,012
41,012
Other assets
57,503
48,927
54,427
Total assets
$
5,540,815
$
5,663,173
$
5,601,293
LIABILITIES AND STOCKHOLDERS’ EQUITY:
LIABILITIES:
Deposits
$
3,764,403
$
3,847,497
$
4,150,219
Securities sold under agreements to repurchase
25,000
25,000
25,000
Federal Home Loan Bank advances and other borrowings
898,535
923,983
558,859
Subordinated debentures, net of issuance costs
61,108
61,052
60,996
Lease liabilities
37,274
38,509
39,790
Advance payments by borrowers for taxes and insurance
29,117
30,847
25,995
Accrued expenses and other liabilities
38,737
38,119
39,044
Total liabilities
4,854,174
4,965,007
4,899,903
STOCKHOLDERS’ EQUITY:
Total stockholders’ equity
686,641
698,166
701,390
Total liabilities and stockholders’ equity
$
5,540,815
$
5,663,173
$
5,601,293
Total shares outstanding
45,243,673
46,530,167
47,442,488
Tangible book value per share (1)
$
14.27
$
14.12
$
13.91
(1)
Tangible book value per share is calculated based on total stockholders' equity, excluding intangible assets (goodwill and core deposit intangibles), divided by total shares outstanding as of the balance sheet date. Core deposit intangibles were $216,000, $247,000, and $266,000 at June 30, 2023, March 31, 2023 and December 31, 2022, respectively, and are included in other assets.
NORTHFIELD BANCORP, INC. CONSOLIDATED STATEMENTS OF INCOME (Dollars in thousands, except share and per share amounts) (unaudited)
For the Three Months Ended
For the Six Months Ended
June 30,
March 31,
June 30,
2023
2022
2023
2023
2022
Interest income:
Loans
$
45,300
$
38,998
$
43,707
$
89,007
$
75,719
Mortgage-backed securities
3,714
3,043
3,792
7,506
5,518
Other securities
1,113
989
1,385
2,498
1,684
Federal Home Loan Bank of New York dividends
727
260
465
1,192
505
Deposits in other financial institutions
816
166
578
1,394
224
Total interest income
51,670
43,456
49,927
101,597
83,650
Interest expense:
Deposits
10,483
1,334
7,821
18,304
2,493
Borrowings
9,198
1,918
6,391
15,589
4,084
Subordinated debt
828
119
819
1,647
119
Total interest expense
20,509
3,371
15,031
35,540
6,696
Net interest income
31,161
40,085
34,896
66,057
76,954
Provision for credit losses
30
149
864
894
552
Net interest income after provision for credit losses
31,131
39,936
34,032
65,163
76,402
Non-interest income:
Fees and service charges for customer services
1,309
1,375
1,380
2,689
2,706
Income on bank-owned life insurance
889
848
870
1,759
1,687
(Losses)/gains on available-for-sale debt securities, net
(18
)
—
1
(17
)
264
Gains/(losses) on trading securities, net
506
(1,563
)
512
1,018
(2,365
)
Gain on sale of loans
35
—
—
35
—
Other
95
105
569
664
186
Total non-interest income
2,816
765
3,332
6,148
2,478
Non-interest expense:
Compensation and employee benefits
12,353
9,418
11,037
23,390
18,925
Occupancy
3,244
3,286
3,372
6,616
6,694
Furniture and equipment
460
426
454
914
852
Data processing
2,071
1,762
2,243
4,314
3,475
Professional fees
768
1,229
971
1,739
2,137
Advertising
573
404
847
1,420
837
Federal Deposit Insurance Corporation insurance
568
355
604
1,172
712
Credit loss (benefit)/expense for off-balance sheet exposures
(661
)
349
111
(550
)
628
Other
1,399
1,484
1,489
2,888
3,162
Total non-interest expense
20,775
18,713
21,128
41,903
37,422
Income before income tax expense
13,172
21,988
16,236
29,408
41,458
Income tax expense
3,613
6,114
4,529
8,142
11,457
Net income
$
9,559
$
15,874
$
11,707
$
21,266
$
30,001
Net income per common share:
Basic
$
0.22
$
0.34
$
0.26
$
0.48
$
0.64
Diluted
$
0.22
$
0.34
$
0.26
$
0.48
$
0.64
Basic average shares outstanding
43,914,110
46,591,723
44,784,228
44,346,881
46,708,716
Diluted average shares outstanding
43,952,939
46,638,113
44,928,905
44,438,633
46,870,433
NORTHFIELD BANCORP, INC. ANALYSIS OF NET INTEREST INCOME (Dollars in thousands) (unaudited)
For the Three Months Ended
June 30, 2023
March 31, 2023
June 30, 2022
Average Outstanding Balance
Interest
Average Yield/ Rate (1)
Average Outstanding Balance
Interest
Average Yield/ Rate (1)
Average Outstanding Balance
Interest
Average Yield/ Rate (1)
Interest-earning assets:
Loans (2)
$
4,284,871
$
45,300
4.24
%
$
4,244,772
$
43,707
4.18
%
$
3,992,731
$
38,998
3.92
%
Mortgage-backed securities (3)
703,415
3,714
2.12
746,735
3,792
2.06
899,479
3,043
1.36
Other securities (3)
239,273
1,113
1.87
275,957
1,385
2.04
297,859
989
1.33
Federal Home Loan Bank of New York stock
43,901
727
6.64
38,066
465
4.95
20,689
260
5.04
Interest-earning deposits in financial institutions
67,822
816
4.83
77,269
578
3.03
94,689
166
0.70
Total interest-earning assets
5,339,282
51,670
3.88
5,382,799
49,927
3.76
5,305,447
43,456
3.29
Non-interest-earning assets
244,567
239,984
266,303
Total assets
$
5,583,849
$
5,622,783
$
5,571,750
Interest-bearing liabilities:
Savings, NOW, and money market accounts
$
2,399,631
6,486
1.08
%
$
2,523,620
$
3,843
0.62
%
$
3,007,929
$
599
0.08
%
Certificates of deposit
540,984
3,997
2.96
624,762
3,978
2.58
438,835
735
0.67
Total interest-bearing deposits
2,940,615
10,483
1.43
3,148,382
7,821
1.01
3,446,764
1,334
0.16
Borrowed funds
1,003,611
9,198
3.68
762,928
6,391
3.40
377,044
1,918
2.04
Subordinated debt
61,071
828
5.44
61,015
819
5.44
9,527
119
5.01
Total interest-bearing liabilities
4,005,297
20,509
2.05
3,972,325
15,031
1.53
3,833,335
3,371
0.35
Non-interest bearing deposits
780,806
848,098
918,980
Accrued expenses and other liabilities
102,846
105,685
105,525
Total liabilities
4,888,949
4,926,108
4,857,840
Stockholders' equity
694,900
696,675
713,910
Total liabilities and stockholders' equity
$
5,583,849
$
5,622,783
$
5,571,750
Net interest income
$
31,161
$
34,896
$
40,085
Net interest rate spread (4)
1.83
%
2.23
%
2.94
%
Net interest-earning assets (5)
$
1,333,985
$
1,410,474
$
1,472,112
Net interest margin (6)
2.34
%
2.63
%
3.03
%
Average interest-earning assets to interest-bearing liabilities
133.31
%
135.51
%
138.40
%
(1)
Average yields and rates are annualized.
(2)
Includes non-accruing loans.
(3)
Securities available-for-sale and other securities are reported at amortized cost.
(4)
Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.
(5)
Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
(6)
Net interest margin represents net interest income divided by average total interest-earning assets.
For the Six Months Ended
June 30, 2023
June 30, 2022
Average Outstanding Balance
Interest
Average Yield/ Rate (1)
Average Outstanding Balance
Interest
Average Yield/ Rate (1)
Interest-earning assets:
Loans (2)
$
4,264,932
$
89,007
4.21
%
$
3,920,792
$
75,719
3.89
%
Mortgage-backed securities (3)
724,955
7,506
2.09
918,864
5,518
1.21
Other securities (3)
257,514
2,498
1.96
277,035
1,684
1.23
Federal Home Loan Bank of New York stock
41,000
1,192
5.86
21,440
505
4.75
Interest-earning deposits in financial institutions
72,519
1,394
3.88
118,872
224
0.38
Total interest-earning assets
5,360,920
101,597
3.82
5,257,003
83,650
3.21
Non-interest-earning assets
242,288
272,869
Total assets
$
5,603,208
$
5,529,872
Interest-bearing liabilities:
Savings, NOW, and money market accounts
$
2,461,283
$
10,329
0.85
%
$
2,981,180
$
1,170
0.08
%
Certificates of deposit
582,642
7,975
2.76
406,156
1,323
0.66
Total interest-bearing deposits
3,043,925
18,304
1.21
3,387,336
2,493
0.15
Borrowed funds
883,934
15,589
3.56
397,775
4,084
2.07
Subordinated debt
61,183
1,647
5.43
4,790
119
5.01
Total interest-bearing liabilities
$
3,989,042
35,540
1.80
$
3,789,901
6,696
0.36
Non-interest bearing deposits
814,266
914,409
Accrued expenses and other liabilities
104,118
102,679
Total liabilities
4,907,426
4,806,989
Stockholders' equity
695,782
722,883
Total liabilities and stockholders' equity
$
5,603,208
$
5,529,872
Net interest income
$
66,057
$
76,954
Net interest rate spread (4)
2.02
%
2.85
%
Net interest-earning assets (5)
$
1,371,878
$
1,467,102
Net interest margin (6)
2.48
%
2.95
%
Average interest-earning assets to interest-bearing liabilities
134.39
%
138.71
%
(1)
Average yields and rates are annualized.
(2)
Includes non-accruing loans.
(3)
Securities available-for-sale and other securities are reported at amortized cost.
(4)
Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.
(5)
Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
(6)
Net interest margin represents net interest income divided by average total interest-earning assets.
Company Contact: William R. Jacobs Chief Financial Officer Tel: (732) 499-7200 ext. 2519
FAQ
What is Northfield Bancorp's net income for Q2 2023?
Northfield Bancorp reported net income of $9.6 million for the three months ended June 30, 2023.
What is the diluted EPS for Northfield Bancorp in Q2 2023?
The diluted EPS for Northfield Bancorp in Q2 2023 was $0.22.
What is the new share repurchase program authorized by Northfield Bancorp?
Northfield Bancorp authorized a new $10.0 million share repurchase program.
What is the cash dividend declared by Northfield Bancorp for Q2 2023?
Northfield Bancorp declared a cash dividend of $0.13 per share of common stock, payable August 23, 2023.
