PDL Community Bancorp Announces 2021 Third Quarter Results

Rhea-AI Summary

PDL Community Bancorp (NASDAQ: PDLB) reported a net income of $2.1 million for Q3 2021, down from $5.9 million in Q2 2021 and $4.0 million in Q3 2020. Net interest income rose 12.4% from the previous quarter to $15.4 million, and increased 42.3% year-over-year. Non-interest income fell by $5.1 million due to reduced gains from property sales. Deposits climbed 21.3% to $1.25 billion since the end of 2020. Total assets reached $1.56 billion while equity grew to $173.9 million. The efficiency ratio worsened to 78.89%, indicating a higher expense burden.

Positive

• Net interest income increased by 12.4% quarter-over-quarter, totaling $15.4 million.
• Deposits rose by 21.3% from December 2020 to September 2021, expanding to $1.25 billion.
• Total assets grew by 15.2% since December 2020, now at $1.56 billion.

Negative

• Net income fell 64.4% quarter-over-quarter and 47.5% year-over-year.
• Non-interest income decreased by $5.1 million from the previous quarter, largely due to a drop in gains from property sales.
• Efficiency ratio increased to 78.89%, indicating higher operational costs.

NEW YORK, Nov. 02, 2021 (GLOBE NEWSWIRE) -- PDL Community Bancorp (the “Company”) (NASDAQ: PDLB), the financial holding company for Ponce Bank (the “Bank”) and Mortgage World Bankers, Inc. (“Mortgage World”), reported net income of $2.1 million, or $0.12 per basic and diluted share, for the third quarter of 2021, compared to net income of $5.9 million, or $0.35 per basic and diluted share, for the prior quarter and net income of $4.0 million, or $0.24 per basic and diluted share, for the third quarter of 2020.

Third Quarter Highlights

• Net interest income of $15.4 million for the current quarter increased $1.7 million, or 12.4%, from prior quarter and $4.6 million, or 42.3%, from same quarter last year.
• Income before income taxes of $3.4 million for the current quarter decreased $4.5 million, or 57.0%, from prior quarter and $1.8 million, or 34.6%, for the same quarter last year. Included in the prior quarter was a net gain of $4.2 million and included in the same quarter last year was a net gain of $4.4 million, both resulting from the sale of real property.
• Average cost of interest-bearing deposits was 0.58% for the current quarter, a decrease from 0.67% for the prior quarter and from 1.12% for the same quarter last year.
• Net interest margin was 4.13% for the current quarter, an increase from 3.84% for the prior quarter and from 3.65% for the same quarter last year.
• Net interest rate spread was 3.92% for the current quarter, an increase from 3.60% for the prior quarter and from 3.33% for the same quarter last year.
• Efficiency ratio was 78.89% for the current quarter compared to 61.80% for the prior quarter and 68.09% for the same quarter last year.
• Non-performing loans of $10.2 million decreased $793,000 year-over-year and equates to 0.77% of total gross loans receivable as of September 30, 2021.
• Net loans receivable were $1.30 billion at September 30, 2021, an increase of $143.6 million, or 12.4%, from December 31, 2020.
• Deposits were $1.25 billion at September 30, 2021, an increase of $219.7 million, or 21.3%, from December 31, 2020.
  

President and Chief Executive Officer’s Comments

Carlos P. Naudon, the Company’s President and CEO, noted, “The numbers are substantiating the success of our strategy. We continue increasing customer relationships, growing both our deposits and loans while continuing to increase our net interest margin and building our demand deposit base. We focus on net operating expenses, maintaining net operating expenses stable as we add resources that deliver revenue producing services to customers, allowing us to further grow into our overhead while increasing profitability. As our PPP loans are being forgiven by the SBA, we are heartened in the retention of large segments of these borrowers and in the continued acknowledgement of the positive impact we are having on our communities. Our demonstrated success as an MDI and CDFI has positioned us well to lead in remediating the disparate effects of the pandemic, and the wealth and financial gaps present in our communities.”

Executive Chairman’s Comments

Steven A. Tsavaris, the Company’s Executive Chairman, added, “Strengthening our capital position is a cornerstone of our strategy of being impactful to both our communities and our other stakeholders. As we move forward to seek approval of our mutual-to-stock conversion and await a favorable outcome of the recently applied for $225 million in capital from the U.S. Department of the Treasury under the Emergency Capital Investment Program, we are humbled and inspired by the trust and hopes being placed in our Company.”

Loan Payment Deferrals

As of September 30, 2021, five loans in the amount of $9.9 million remained in forbearance as a result of renewed forbearance for a period of three months. Of the five loans receiving renewed forbearance, one loan in the amount of $6.6 million is related to construction real estate, three loans, totaling $2.9 million are related to one-to-four family residential real estate and one loan in the amount of $388,000 is related to non-residential properties. All of these loans had been performing in accordance with their contractual obligations prior to the granting of the initial forbearance. The Company actively monitors the business activities of borrowers in forbearance and seeks to determine their capacity to resume payments as contractually obligated upon the termination of the forbearance period. The extended forbearances are short-term modifications made on a good faith basis in response to the COVID-19 pandemic and in furtherance of governmental policies.

Results of Operations Summary

Net income for the three months ended September 30, 2021 was $2.1 million, compared to $5.9 million of net income for the three months ended June 30, 2021 and $4.0 million of net income for the three months ended September 30, 2020.

The $3.9 million decrease in net income for the three months ended September 30, 2021 compared to the three months ended June 30, 2021 was due substantially to a decrease of $5.1 million in non-interest income primarily resulting from a decrease of $4.2 million in gain, net of expenses, on sale of real property. The decrease in net income was also attributable to an increase of $1.1 million in non-interest expense, offset by an increase of $1.7 million in net interest income and a decrease of $596,000 in provision for income taxes.

The $2.0 million decrease in net income for the three months ended September 30, 2021 compared to the three months ended September 30, 2020 was due substantially to a decrease of $4.0 million in non-interest income primarily resulting from a decrease of $4.4 million in gain, net of expenses, on sale of real property. The decrease in net income was also attributable to an increase of $2.4 million in non-interest expense and an increase of $171,000 in provision for income taxes, offset by an increase of $4.6 million in net interest income.

Net income for the nine months ended September 30, 2021 was $10.4 million, compared to $2.2 million of net income for the nine months ended September 30, 2020. The change from the nine months ended September 30, 2020 is primarily due to a $7.0 million increase in non-interest income primarily due to increases of $2.6 million in sale of mortgage loans, $1.9 million in loan originations attributable to Mortgage World and $2.5 million in the aggregate related to service charges and fees, brokerage commissions, late and prepayment charges, gain, net of expenses, on sale of real property and other non-interest income. The increase in net income was also attributable to an $11.8 million increase in net interest income and a $193,000 decrease in provision for loan losses, partially offset by increases of $7.7 million in non-interest expense and $3.1 million in provision for income taxes.

Net interest income for the three months ended September 30, 2021 was $15.4 million, an increase of $1.7 million, or 12.4%, compared to the three months ended June 30, 2021 and an increase of $4.6 million, or 42.3%, compared to the three months ended September 30, 2020. The increase of $1.7 million in net interest income for the three months ended September 30, 2021 compared to the three months ended June 30, 2021 was attributable to an increase of $1.6 million in interest and dividend income and a decrease of $127,000 in interest expense. The increase of $4.6 million in net interest income for the three months ended September 30, 2021 compared to the three months ended September 30, 2020 was attributable to an increase of $3.8 million in interest and dividend income and a decrease of $767,000 in interest expense.

Net interest income for the nine months ended September 30, 2021 was $42.1 million, an increase of $11.8 million, or 38.8%, compared to the nine months ended September 30, 2020. The increase in net interest income was attributable to an increase of $9.4 million in interest and dividend income and a decrease of $2.3 million in interest expense.

Net interest margin was 4.13% for the three months ended September 30, 2021, an increase of 29 basis points from 3.84% for the three months ended June 30, 2021 and an increase of 48 basis points from 3.65% for the three months ended September 30, 2020. 

Net interest rate spread increased by 32 basis points to 3.92% for the three months ended September 30, 2021 from 3.60% for the three months ended June 30, 2021 and increased by 59 basis points from 3.33% for the three months ended September 30, 2020. The increase in the net interest rate spread for the three months ended September 30, 2021 compared to the three months ended June 30, 2021 was primarily due to an increase in the average yields on interest-earning assets of 23 basis points to 4.66% for the three months ended September 30, 2021 from 4.43% for the three months ended June 30, 2021, and by a decrease on the average rates on interest-bearing liabilities of 9 basis points to 0.74% for the three months ended September 30, 2021 from 0.83% for the three months ended June 30, 2021. The increase in the net interest rate spread for the three months ended September 30, 2021 compared to the three months ended September 30, 2020 was primarily due to a decrease on the average rates on interest-bearing liabilities of 50 basis points to 0.74% for the three months ended September 30, 2021 from 1.24% for the three months ended September 30, 2020, and by a slight increase in the average yields on interest-earning assets of 9 basis points to 4.66% for the three months ended September 30, 2021 from 4.57% for the three months ended September 30, 2020.

Non-interest income decreased $5.1 million to $3.2 million for the three months ended September 30, 2021 from $8.3 million for the three months ended June 30, 2021 and decreased $4.0 million from $7.3 million for the three months ended September 30, 2020.

The decrease in non-interest income for the three months ended September 30, 2021 compared to the three months ended June 30, 2021 was primarily due to decreases of $4.2 million in gain, net of expenses, from the sale of real property recognized in the second quarter of 2021, $471,000 in other non-interest income, $346,000 in loan origination fees, $160,000 in brokerage commissions and $113,000 in income on sale of mortgage loans attributable to Mortgage World, offset by increases of $128,000 in service charges and fees and $31,000 in late and prepayment charges.

The decrease in non-interest income for the three months ended September 30, 2021 compared to the three months ended September 30, 2020 was primarily due to decreases of $4.4 million in gain, net of expenses, from the sale of real property recognized in the third quarter of 2020, $197,000 in income on sale of mortgage loans attributable to Mortgage World, $177,000 in brokerage commissions and $30,000 in other non-interest income, offset by increases of $356,000 in loan origination fees attributable to Mortgage World, $258,000 service charges and fees and $184,000 in late and prepayment charges.

Non-interest income increased $7.0 million to $15.5 million for the nine months ended September 30, 2021 from $8.5 million for the nine months ended September 30, 2020. The increase in non-interest income for the nine months ended September 30, 2021 compared to the nine months ended September 30, 2020 was primarily due to increases of $2.6 million in sale of mortgage loans and $1.9 million in loan originations attributable to Mortgage World. Other increases include $597,000 in other non-interest income, $594,000 in late and prepayment charges, $560,000 in service charges and fees, $404,000 in brokerage commissions and $400,000 in gain, net of expenses, from the sale of real property.

Non-interest expense increased $1.1 million, or 8.0%, to $14.7 million for the three months ended September 30, 2021, from $13.6 million for the three months ended June 30, 2021 and increased $2.4 million from $12.3 million for the three months ended September 30, 2020.

The increase in non-interest expense for the three months ended September 30, 2021, compared to the three months ended June 30, 2021 was primarily attributable to an increase of $2.2 million in compensation and benefits, which was specifically related to the allocable portion of employee expenses related to the origination of Paycheck Protection Program (“PPP”) loans, netted against PPP loan origination fees received from the SBA in the second quarter of 2021. Other increases in non-interest expense were $184,000 in data processing expenses, $159,000 in office supplies, telephone and postage and $155,000 in other operating expenses, offset by decreases of $1.1 million in professional fees as a result of $1.2 million of additional consultant fees recognized in the second quarter of 2021 and $455,000 in direct loan expenses.

The increase in non-interest expense for the three months ended September 30, 2021, compared to the three months ended September 30, 2020 primarily reflects increases of $873,000 in compensation and benefits, which was specifically related to the allocable portion of employee expenses related to the origination of PPP loans, netted against PPP loan origination fees received from the SBA recognized in the third quarter of 2020. Other increases in non-interest expense include $321,000 in data processing expenses, $279,000 in other operating expenses, $265,000 in occupancy and equipment, $259,000 in direct loan expenses, $240,000 in office supplies, telephone and postage and $212,000 in professional fees.

Non-interest expense increased $7.7 million, or 22.9%, to $41.3 million for the nine months ended September 30, 2021, compared to $33.6 million for the nine months ended September 30, 2020. The increase in non-interest expense for the nine months ended September 30, 2021, compared to the nine months ended September 30, 2020 was attributable to increases of $2.0 million in direct loan expenses, $1.4 million in occupancy and equipment, $1.4 million in professional fees, primarily due to an increase in consulting expenses related to a third-party service provider that provided loan origination services related to PPP loans and $1.1 million in compensation and benefits. Other increases in non-interest expense include $790,000 in other operating expenses, $685,000 in data processing expenses and $103,000 in regulatory dues, offset by a decrease of $369,000 in marketing and promotional expenses.

Balance Sheet Summary

Total assets increased $205.3 million, or 15.2%, to $1.56 billion at September 30, 2021 from $1.36 billion at December 31, 2020. The increase in total assets is attributable to increases of $143.6 million in net loans receivable, including $110.6 million net increase in PPP loans, $86.9 million in available-for-sale securities, $2.2 million in other assets, $2.0 million, net, in premises and equipment, $2.0 million in accrued interest receivable, and $170,000 in deferred tax assets. The increase in total assets was reduced by decreases of $21.5 million in mortgage loans held for sale, at fair value, $9.0 million in cash and cash equivalents, $425,000 in FHLBNY stock, $306,000 in held-to-maturity securities and $249,000 in placement with banks.

Total liabilities increased $191.0 million, or 16.0%, to $1.39 billion at September 30, 2021 from $1.20 billion at December 31, 2020. The increase in total liabilities was mainly attributable to increases of $219.7 million in deposits, $2.1 million in advance payments by borrowers for taxes and insurance and $178,000 in accrued interest payable, offset by decreases of $18.7 million in warehouse lines of credit, $11.0 million in advances from FHLBNY and $934,000 in other liabilities.

Total stockholders’ equity increased $14.3 million, or 9.0%, to $173.9 million at September 30, 2021 from $159.5 million at December 31, 2020. The $14.3 million increase in stockholders’ equity was mainly attributable to $10.4 million in net income, $3.1 million in net treasury stock activity, $1.1 million related to share-based compensation and $472,000 related to the Company’s Employee Stock Ownership Plan, offset by $756,000 related to unrealized loss on available-for-sale securities.

As of September 30, 2021, the Company had repurchased a total of 1,670,619 shares under prior repurchase programs at a weighted average price of $13.22 per share, of which 1,132,086 were reported as treasury stock. The Company suspended its repurchase program as of May 3, 2021. Of the 1,670,619 shares repurchased, 189,960 shares have been used for grants awarded to directors, executive officers and non-executive officers under the Company’s 2018 Long-Term Incentive Plan pursuant to restricted stock units which vested on December 4, 2020 and 2019 and July 23, 2021. Of these 189,960 shares, 166 shares were retained to satisfy a recipient’s taxes and other withholding obligations and these shares remain as part of treasury stock. In addition, on April 22, 2021, 348,739 shares were sold to Banc of America Strategic Investments Corporation in a privately negotiated transaction.

About PDL Community Bancorp

PDL Community Bancorp is the financial holding company for Ponce Bank and Mortgage World Bankers, Inc. Ponce Bank is a federally chartered stock savings association. Ponce Bank is designated a Minority Depository Institution, a Community Development Financial Institution, and a certified Small Business Administration lender. Ponce Bank’s business primarily consists of taking deposits from the general public and to a lesser extent from alternative funding sources and investing those deposits, together with funds generated from operations and borrowings, in mortgage loans, consisting of 1-4 family residences (investor-owned and owner-occupied), multifamily residences, nonresidential properties and construction and land, and, to a lesser extent, in business and consumer loans. Ponce Bank also invests in securities, which consist of U.S. Government and federal agency securities and securities issued by government-sponsored or government-owned enterprises as well as mortgage-backed securities, corporate bonds and obligations, and Federal Home Loan Bank stock. Mortgage World Bankers, Inc. is a mortgage lender operating in five states and is subject to the regulation and examination of the New York State Department of Financial Services. As a Federal Housing Administration (“FHA”)-approved Title II lender, Mortgage World Bankers, Inc. originates and sells to investors single family mortgage loans guaranteed by the FHA, as well as conventional mortgages.

Forward Looking Statements

Certain statements herein constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements may be identified by words such as “believes,” “will,” “would,” “expects,” “project,” “may,” “could,” “developments,” “strategic,” “launching,” “opportunities,” “anticipates,” “estimates,” “intends,” “plans,” “targets” and similar expressions. These statements are based upon the current beliefs and expectations of the Company’s management and are subject to significant risks and uncertainties. Actual results may differ materially from those set forth in the forward-looking statements as a result of numerous factors. Factors that could cause such differences to exist include, but are not limited to, adverse conditions in the capital and debt markets and the impact of such conditions on the Company’s business activities; changes in interest rates; competitive pressures from other financial institutions; the effects of general economic conditions on a national basis or in the local markets in which the Company operates, including changes that adversely affect borrowers’ ability to service and repay the Company’s loans; the anticipated impact of the COVID-19 pandemic and the Company’s attempts at mitigation; changes in the value of securities in the Company’s investment portfolio; changes in loan default and charge-off rates; fluctuations in real estate values; the adequacy of loan loss reserves; decreases in deposit levels necessitating increased borrowing to fund loans and investments; operational risks including, but not limited to, cybersecurity, fraud and natural disasters; changes in government regulation; changes in accounting standards and practices; the risk that intangibles recorded in the Company’s financial statements will become impaired; demand for loans in the Company’s market area; the Company’s ability to attract and maintain deposits; risks related to the implementation of acquisitions, dispositions, and restructurings; the risk that the Company may not be successful in the implementation of its business strategy; changes in assumptions used in making such forward-looking statements and the risk factors described in the Annual Report on Form 10-K and Quarterly Reports on Form 10-Q as filed with the Securities and Exchange Commission (the “SEC”), which are available at the SEC’s website, www.sec.gov. Should one or more of these risks materialize or should underlying beliefs or assumptions prove incorrect, PDL Community Bancorp’s actual results could differ materially from those discussed. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. The Company disclaims any obligation to publicly update or revise any forward-looking statements to reflect changes in underlying assumptions or factors, new information, future events or other changes, except as may be required by applicable law or regulation.

PDL Community Bancorp and Subsidiaries
Consolidated Statements of Financial Condition
(Dollars in thousands, except for share data)

	As of
	September 30,				June 30,				March 31,				December 31,				September 30,
	2021				2021				2021				2020				2020
ASSETS
Cash and due from banks:
Cash	$	29,365			$	32,541			$	13,551			$	26,936			$	14,302
Interest-bearing deposits in banks		33,673				33,551				76,571				45,142				61,790
Total cash and cash equivalents		63,038				66,092				90,122				72,078				76,092
Available-for-sale securities, at fair value		104,358				48,536				30,929				17,498				14,512
Held-to-maturity securities, at amortized cost		1,437				1,720				1,732				1,743				—
Placement with banks		2,490				2,739				2,739				2,739				2,739
Mortgage loans held for sale, at fair value		13,930				15,308				13,725				35,406				13,100
Loans receivable, net		1,302,238				1,343,578				1,230,458				1,158,640				1,108,956
Accrued interest receivable		13,360				13,134				12,547				11,396				9,995
Premises and equipment, net		34,081				34,057				33,625				32,045				32,113
Federal Home Loan Bank of New York stock (FHLBNY), at cost		6,001				6,156				6,057				6,426				6,414
Deferred tax assets		4,826				5,493				4,569				4,656				3,586
Other assets		14,793				10,837				7,204				12,604				9,844
Total assets	$	1,560,552			$	1,547,650			$	1,433,707			$	1,355,231			$	1,277,351
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Deposits	$	1,249,261			$	1,236,161			$	1,138,546			$	1,029,579			$	973,244
Accrued interest payable		238				55				66				60				58
Advance payments by borrowers for taxes and insurance		9,118				7,682				9,264				7,019				7,739
Advances from the FHLBNY and others		106,255				109,255				109,255				117,255				117,283
Warehouse lines of credit		11,261				13,084				11,664				29,961				9,065
Mortgage loan fundings payable		1,136				743				676				1,483				1,457
Other liabilities		9,396				8,780				3,032				10,330				10,131
Total liabilities		1,386,665				1,375,760				1,272,503				1,195,687				1,118,977
Commitments and contingencies
Stockholders' Equity:
Preferred stock, $0.01 par value; 10,000,000 shares authorized		—				—				—				—				—
Common stock, $0.01 par value; 50,000,000 shares authorized		185				185				185				185				185
Treasury stock, at cost		(15,069	)			(15,069	)			(19,285	)			(18,114	)			(18,281	)
Additional paid-in-capital		86,360				85,956				85,470				85,105				85,817
Retained earnings		107,977				105,925				99,993				97,541				95,913
Accumulated other comprehensive income		(621	)			(41	)			28				135				168
Unearned compensation ─ ESOP		(4,945	)			(5,066	)			(5,187	)			(5,308	)			(5,428	)
Total stockholders' equity		173,887				171,890				161,204				159,544				158,374
Total liabilities and stockholders' equity	$	1,560,552			$	1,547,650			$	1,433,707			$	1,355,231			$	1,277,351

PDL Community Bancorp and Subsidiaries
Consolidated Statements of Operations
(Dollars in thousands, except per share data)

	Three Months Ended
	September 30,				June 30,				March 31,				December 31,				September 30,
	2021				2021				2021				2020				2020
Interest and dividend income:
Interest on loans receivable	$	16,991			$	15,603			$	14,925			$	14,070			$	13,375
Interest on deposits due from banks		9				2				2				10				5
Interest and dividend on securities and FHLBNY stock		425				239				250				233				223
Total interest and dividend income		17,425				15,844				15,177				14,313				13,603
Interest expense:
Interest on certificates of deposit		1,010				1,108				1,219				1,422				1,597
Interest on other deposits		354				382				382				448				500
Interest on borrowings		621				622				684				769				655
Total interest expense		1,985				2,112				2,285				2,639				2,752
Net interest income		15,440				13,732				12,892				11,674				10,851
Provision for loan losses		572				586				686				406				620
Net interest income after provision for loan losses		14,868				13,146				12,206				11,268				10,231
Non-interest income:
Service charges and fees		494				366				329				263				236
Brokerage commissions		270				430				223				455				447
Late and prepayment charges		329				298				244				81				145
Income on sale of mortgage loans		1,175				1,288				1,508				2,748				1,372
Loan origination		625				971				539				656				269
Gain on sale of real property		—				4,176				663				—				4,412
Other		341				812				387				596				371
Total non-interest income		3,234				8,341				3,893				4,799				7,252
Non-interest expense:
Compensation and benefits		6,427				4,212				5,664				6,846				5,554
Occupancy and equipment		2,849				2,838				2,634				2,686				2,584
Data processing expenses		917				733				594				578				596
Direct loan expenses		696				1,151				1,009				599				437
Insurance and surety bond premiums		147				143				146				166				138
Office supplies, telephone and postage		626				467				409				385				386
Professional fees		1,765				2,902				1,262				1,533				1,553
Marketing and promotional expenses		51				48				38				—				127
Directors fees		67				69				69				69				69
Regulatory dues		74				120				60				59				49
Other operating expenses		1,113				958				1,030				1,034				834
Total non-interest expense		14,732				13,641				12,915				13,955				12,327
Income before income taxes		3,370				7,846				3,184				2,112				5,156
Provision for income taxes		1,318				1,914				732				484				1,147
Net income	$	2,052			$	5,932			$	2,452			$	1,628			$	4,009
Earnings per share:
Basic	$	0.12			$	0.35			$	0.15			$	0.10			$	0.24
Diluted	$	0.12			$	0.35			$	0.15			$	0.10			$	0.24
Weighted average shares outstanding:
Basic		16,823,731				16,737,037				16,548,196				16,558,576				16,612,205
Diluted		16,914,833				16,773,606				16,548,196				16,558,576				16,612,205

PDL Community Bancorp and Subsidiaries
Consolidated Statements of Operations
(Dollars in thousands, except per share data)

		Nine Months Ended September 30,
		2021				2020				Variance $				Variance %
Interest and dividend income:
Interest on loans receivable		$	47,519			$	38,319			$	9,200				24.01	%
Interest on deposits due from banks			13				74				(61	)			(82.43	%)
Interest and dividend on securities and FHLBNY stock			914				633				281				44.39	%
Total interest and dividend income			48,446				39,026				9,420				24.14	%
Interest expense:
Interest on certificates of deposit			3,337				5,154				(1,817	)			(35.25	%)
Interest on other deposits			1,118				1,726				(608	)			(35.23	%)
Interest on borrowings			1,927				1,850				77				4.16	%
Total interest expense			6,382				8,730				(2,348	)			(26.90	%)
Net interest income			42,064				30,296				11,768				38.84	%
Provision for loan losses			1,844				2,037				(193	)			(9.47	%)
Net interest income after provision for loan losses			40,220				28,259				11,961				42.33	%
Non-interest income:
Service charges and fees			1,189				629				560				89.03	%
Brokerage commissions			923				519				404				77.84	%
Late and prepayment charges			871				277				594				214.44	%
Income on sale of mortgage loans			3,971				1,372				2,599				189.43	%
Loan origination			2,135				269				1,866				693.68	%
Gain on sale of real property			4,812				4,412				400				9.07	%
Other			1,567				970				597				61.55	%
Total non-interest income			15,468				8,448				7,020				83.10	%
Non-interest expense:
Compensation and benefits			16,303				15,207				1,096				7.21	%
Occupancy and equipment			8,321				6,878				1,443				20.98	%
Data processing expenses			2,244				1,559				685				43.94	%
Direct loan expenses			2,856				848				2,008				236.79	%
Insurance and surety bond premiums			436				387				49				12.66	%
Office supplies, telephone and postage			1,502				1,014				488				48.13	%
Professional fees			5,929				4,516				1,413				31.29	%
Marketing and promotional expenses			137				506				(369	)			(72.92	%)
Directors fees			205				207				(2	)			(0.97	%)
Regulatory dues			254				151				103				68.21	%
Other operating expenses			3,101				2,311				790				34.18	%
Total non-interest expense			41,288				33,584				7,704				22.94	%
Income before income taxes			14,400				3,123				11,277				361.10	%
Provision for income taxes			3,964				898				3,066				341.43	%
Net income		$	10,436			$	2,225			$	8,211				369.03	%
Earnings per share:
Basic		$	0.62			$	0.13			N/A				N/A
Diluted		$	0.62			$	0.13			N/A				N/A
Weighted average shares outstanding:
Basic			16,703,997				16,711,677			N/A				N/A
Diluted			16,746,554				16,724,199			N/A				N/A

PDL Community Bancorp and Subsidiaries
Key Metrics

	At or for the Three Months Ended
	September 30,				June 30,				March 31,				December 31,				September 30,
	2021				2021				2021				2020				2020
Performance Ratios:
Return on average assets (1)		0.52	%			1.59	%			0.72	%			0.50	%			1.28	%
Return on average equity (1)		4.59	%			13.95	%			6.16	%			4.03	%			9.95	%
Net interest rate spread (1) (2)		3.92	%			3.60	%			3.76	%			3.50	%			3.33	%
Net interest margin (1) (3)		4.13	%			3.84	%			4.00	%			3.78	%			3.65	%
Non-interest expense to average assets (1)		3.72	%			3.65	%			3.82	%			4.29	%			3.95	%
Efficiency ratio (4)		78.89	%			61.80	%			76.94	%			84.71	%			68.09	%
Average interest-earning assets to average interest- bearing liabilities		138.89	%			140.13	%			133.25	%			132.04	%			134.35	%
Average equity to average assets		11.27	%			11.37	%			11.77	%			12.44	%			12.90	%
Capital Ratios:
Total capital to risk weighted assets (bank only)		16.15	%			16.08	%			15.80	%			15.95	%			16.93	%
Tier 1 capital to risk weighted assets (bank only)		14.90	%			14.83	%			14.54	%			14.70	%			15.68	%
Common equity Tier 1 capital to risk-weighted assets (bank only)		14.90	%			14.83	%			14.54	%			14.70	%			15.68	%
Tier 1 capital to average assets (bank only)		9.98	%			10.22	%			10.78	%			11.19	%			11.46	%
Asset Quality Ratios:
Allowance for loan losses as a percentage of total loans		1.21	%			1.16	%			1.24	%			1.27	%			1.28	%
Allowance for loan losses as a percentage of nonperforming loans		157.17	%			175.63	%			126.07	%			127.28	%			131.00	%
Net (charge-offs) recoveries to average outstanding loans (1)		(0.13	%)			(0.07	%)			(0.02	%)			0.03	%			0.00	%
Non-performing loans as a percentage of total gross loans		0.77	%			0.66	%			0.99	%			1.00	%			0.98	%
Non-performing loans as a percentage of total assets		0.65	%			0.58	%			0.86	%			0.86	%			0.86	%
Total non-performing assets as a percentage of total assets		0.65	%			0.58	%			0.86	%			0.86	%			0.86	%
Total non-performing assets, accruing loans past due 90 days or more, and accruing troubled debt restructured loans as a percentage of total assets		1.05	%			1.01	%			1.32	%			1.35	%			1.36	%
Other:
Number of offices (5)	19				19				20				20				20
Number of full-time equivalent employees (6)	230				231				236				227				230

(1)	Annualized where appropriate.
(2)	Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average rate of interest-bearing liabilities.
(3)	Net interest margin represents net interest income divided by average total interest-earning assets.
(4)	Efficiency ratio represents noninterest expense divided by the sum of net interest income and noninterest income.
(5)	Number of offices included 5 offices at September 30, 2021 and June 30, 2021, and included 6 offices at March 31, 2021, December 31, 2020 and September 30, 2020 due to the acquisition of Mortgage World.
(6)	Subsequent to July 10, 2020, number of full-time equivalent employees includes full-time equivalent employees related to Mortgage World.

PDL Community Bancorp and Subsidiaries
Loan Portfolio

		As of
		September 30,							June 30,							March 31,							December 31,							September 30,
		2021							2021							2021							2020							2020
		Amount			Percent				Amount			Percent				Amount			Percent				Amount			Percent				Amount			Percent
		(Dollars in thousands)
Mortgage loans:
1-4 family residential
Investor Owned		$	319,346			24.14	%		$	325,409			23.82	%		$	317,895			25.51	%		$	319,596			27.27	%		$	320,438			28.55	%
Owner-Occupied			97,493			7.37	%			98,839			7.24	%			99,985			8.02	%			98,795			8.43	%			93,340			8.31	%
Multifamily residential			317,575			24.01	%			318,579			23.33	%			315,078			25.28	%			307,411			26.23	%			284,775			25.37	%
Nonresidential properties			211,075			15.96	%			211,181			15.46	%			215,340			17.28	%			218,929			18.68	%			217,771			19.40	%
Construction and land			133,130			10.07	%			125,265			9.17	%			119,339			9.57	%			105,858			9.03	%			99,721			8.88	%
Total mortgage loans			1,078,619			81.55	%			1,079,273			79.02	%			1,067,637			85.66	%			1,050,589			89.64	%			1,016,045			90.52	%
Non-mortgage loans:
Business loans (1)			207,859			15.72	%			253,935			18.59	%			142,135			11.40	%			94,947			8.10	%			96,700			8.61	%
Consumer loans (2)			36,095			2.73	%			32,576			2.39	%			36,706			2.94	%			26,517			2.26	%			9,806			0.87	%
Total non-mortgage loans			243,954			18.45	%			286,511			20.98	%			178,841			14.34	%			121,464			10.36	%			106,506			9.48	%
Total loans, gross			1,322,573			100.00	%			1,365,784			100.00	%			1,246,478			100.00	%			1,172,053			100.00	%			1,122,551			100.00	%
Net deferred loan origination costs			(4,327	)						(6,331	)						(512	)						1,457							786
Allowance for losses on loans			(16,008	)						(15,875	)						(15,508	)						(14,870	)						(14,381	)
Loans, net		$	1,302,238						$	1,343,578						$	1,230,458						$	1,158,640						$	1,108,956

 

(1)	As of September 30, 2021, June 30, 2021, March 31, 2021, December 31, 2020, and September 30, 2020, business loans include $195.9 million, $241.5 million, $132.5 million, $85.3 million, and $86.2 million, respectively, of PPP loans.
(2)	As of September 30, 2021, June 30, 2021, March 31, 2021, December 31, 2020 and September 30, 2020, consumer loans include $35.5 million, $32.0 million, $35.9 million, $25.5 million and $8.7 million, respectively, of loans originated by the Bank pursuant to its arrangement with Grain Technologies, LLC.

PDL Community Bancorp and Subsidiaries
Deposits

		As of
		September 30,							June 30,							March 31,							December 31,							September 30,
		2021							2021							2021							2020							2020
		Amount			Percent				Amount			Percent				Amount			Percent				Amount			Percent				Amount			Percent
		(Dollars in thousands)
Demand (1)		$	297,777			23.85	%		$	320,404			25.91	%		$	242,255			21.28	%		$	189,855			18.44	%		$	186,328			19.15	%
Interest-bearing deposits:
NOW/IOLA accounts			28,025			2.24	%			28,996			2.35	%			32,235			2.83	%			39,296			3.82	%			29,618			3.04	%
Money market accounts			199,758			15.99	%			172,925			13.99	%			157,271			13.81	%			136,258			13.23	%			148,877			15.30	%
Reciprocal deposits			147,226			11.79	%			151,443			12.25	%			137,402			12.07	%			131,363			12.76	%			108,367			11.13	%
Savings accounts			142,851			11.43	%			130,430			10.55	%			130,211			11.44	%			125,820			12.22	%			120,883			12.42	%
Total NOW, money market, reciprocal and savings accounts			517,860			41.45	%			483,794			39.14	%			457,119			40.15	%			432,737			42.03	%			407,745			41.89	%
Certificates of deposit of $250K or more			70,996			5.68	%			74,941			6.06	%			77,418			6.80	%			78,435			7.62	%			80,403			8.26	%
Brokered certificates of deposit (2)			83,505			6.68	%			83,506			6.76	%			86,004			7.55	%			52,678			5.12	%			55,878			5.74	%
Listing service deposits (2)			66,340			5.31	%			66,518			5.38	%			61,133			5.37	%			39,476			3.83	%			49,342			5.07	%
All other certificates of deposit less than $250K			212,783			17.03	%			206,998			16.75	%			214,617			18.85	%			236,398			22.96	%			193,548			19.89	%
Total certificates of deposit			433,624			34.70	%			431,963			34.95	%			439,172			38.57	%			406,987			39.53	%			379,171			38.96	%
Total interest-bearing deposits			951,484			76.15	%			915,757			74.09	%			896,291			78.72	%			839,724			81.56	%			786,916			80.85	%
Total deposits		$	1,249,261			100.00	%		$	1,236,161			100.00	%		$	1,138,546			100.00	%		$	1,029,579			100.00	%		$	973,244			100.00	%

 

(1)	Included in demand deposits are deposits related to net PPP funding.
(2)	As of September 30, 2021, June 30, 2021, March 31, 2021, December 31, 2020, and September 30, 2020, there were $28.9 million, $28.9 million, $28.8 million, $27.0 million, and $26.9 million, respectively, in individual listing service deposits amounting to $250,000 or more. All brokered certificates of deposit individually amounted to less than $250,000.

PDL Community Bancorp and Subsidiaries
Nonperforming Assets

	As of
	September 30,				June 30,				March 31,				December 31,				September 30,
	2021				2021				2021				2020				2020
	(Dollars in thousands)
Non-accrual loans:
Mortgage loans:
1-4 family residential
Investor owned	$	1,669			$	1,983			$	2,907			$	2,808			$	2,750
Owner occupied		1,090				1,593				1,585				1,053				1,075
Multifamily residential		2,577				955				946				946				210
Nonresidential properties		1,388				1,408				3,761				3,776				3,830
Construction and land		922				—				—				—				—
Non-mortgage loans:
Business		—				—				—				—				—
Consumer		—				—				—				—				—
Total non-accrual loans (not including non-accruing troubled debt restructured loans)	$	7,646			$	5,939			$	9,199			$	8,583			$	7,865
Non-accruing troubled debt restructured loans:
Mortgage loans:
1-4 family residential
Investor owned	$	238			$	242			$	246			$	249			$	267
Owner occupied		2,200				2,199				2,195				2,197				2,191
Multifamily residential		—				—				—				—				—
Nonresidential properties		101				659				661				654				655
Construction and land		—				—				—				—				—
Non-mortgage loans:
Business		—				—				—				—				—
Consumer		—				—				—				—				—
Total non-accruing troubled debt restructured loans		2,539				3,100				3,102				3,100				3,113
Total non-accrual loans	$	10,185			$	9,039			$	12,301			$	11,683			$	10,978
Total non-performing assets	$	10,185			$	9,039			$	12,301			$	11,683			$	10,978
Accruing troubled debt restructured loans:
Mortgage loans:
1-4 family residential
Investor owned	$	3,121			$	3,347			$	3,362			$	3,378			$	3,396
Owner occupied		2,396				2,431				2,466				2,505				2,177
Multifamily residential		—				—				—				—				—
Nonresidential properties		738				755				750				754				759
Construction and land		—				—				—				—				—
Non-mortgage loans:
Business		—				—				—				—				—
Consumer		—				—				—				—				—
Total accruing troubled debt restructured loans	$	6,255			$	6,533			$	6,578			$	6,637			$	6,332
Total non-performing assets and accruing troubled debt restructured loans	$	16,440			$	15,572			$	18,879			$	18,320			$	17,310
Total non-performing loans to total gross loans		0.77	%			0.66	%			0.99	%			1.00	%			0.98	%
Total non-performing assets to total assets		0.65	%			0.58	%			0.86	%			0.86	%			0.86	%
Total non-performing assets and accruing troubled debt restructured loans to total assets		1.05	%			1.01	%			1.32	%			1.35	%			1.36	%

PDL Community Bancorp and Subsidiaries
Average Balance Sheets

	For the Three Months Ended September 30,
	2021											2020
	Average											Average
	Outstanding								Average			Outstanding								Average
	Balance				Interest				Yield/Rate (1)			Balance				Interest				Yield/Rate (1)
	(Dollars in thousands)
Interest-earning assets:
Loans (2)	$	1,356,130			$	16,991			4.97	%		$	1,109,799			$	13,375			4.79	%
Securities (3)		72,960				355			1.93	%			13,741				132			3.81	%
Other (4)		53,182				79			0.59	%			60,068				96			0.64	%
Total interest-earning assets		1,482,272				17,425			4.66	%			1,183,608				13,603			4.57	%
Non-interest-earning assets		90,110											58,493
Total assets	$	1,572,382										$	1,242,101
Interest-bearing liabilities:
NOW/IOLA	$	30,221			$	23			0.30	%		$	29,687			$	40			0.54	%
Money market		323,840				294			0.36	%			224,339				422			0.75	%
Savings		137,078				36			0.10	%			121,355				37			0.12	%
Certificates of deposit		448,191				1,010			0.89	%			371,094				1,597			1.71	%
Total deposits		939,330				1,363			0.58	%			746,475				2,096			1.12	%
Advance payments by borrowers		10,061				1			0.04	%			7,756				1			0.05	%
Borrowings		117,824				621			2.09	%			126,729				655			2.06	%
Total interest-bearing liabilities		1,067,215				1,985			0.74	%			880,960				2,752			1.24	%
Non-interest-bearing liabilities:
Non-interest-bearing demand		317,727				—							191,269				—
Other non-interest-bearing liabilities		10,154				—							9,607				—
Total non-interest-bearing liabilities		327,881				—							200,876				—
Total liabilities		1,395,096				1,985							1,081,836				2,752
Total equity		177,286											160,265
Total liabilities and total equity	$	1,572,382							0.74	%		$	1,242,101							1.24	%
Net interest income					$	15,440										$	10,851
Net interest rate spread (5)									3.92	%										3.33	%
Net interest-earning assets (6)	$	415,057										$	302,648
Net interest margin (7)									4.13	%										3.65	%
Average interest-earning assets to interest-bearing liabilities									138.89	%										134.35	%

 

(1)	Annualized where appropriate.
(2)	Loans include loans and mortgage loans held for sale, at fair value.
(3)	Securities include available-for-sale securities and held-to-maturity securities.
(4)	Includes FHLBNY demand account and FHLBNY stock dividends.
(5)	Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average rate of interest-bearing liabilities.
(6)	Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
(7)	Net interest margin represents net interest income divided by average total interest-earning assets.

PDL Community Bancorp and Subsidiaries
Average Balance Sheets

	For the Nine Months Ended September 30,
	2021											2020
	Average											Average
	Outstanding								Average			Outstanding								Average
	Balance				Interest				Yield/Rate (1)			Balance				Interest				Yield/Rate
	(Dollars in thousands)
Interest-earning assets:
Loans (2)	$	1,309,765			$	47,519			4.85	%		$	1,036,706			$	38,319			4.94	%
Securities (3)		45,749				701			2.05	%			16,227				361			2.97	%
Other (4)		53,425				226			0.57	%			55,746				346			0.83	%
Total interest-earning assets		1,408,939				48,446			4.60	%			1,108,679				39,026			4.70	%
Non-interest-earning assets		73,493											53,945
Total assets	$	1,482,432										$	1,162,624
Interest-bearing liabilities:
NOW/IOLA	$	31,215			$	93			0.40	%		$	29,469			$	117			0.53	%
Money market		300,594				909			0.40	%			193,951				1,497			1.03	%
Savings		131,849				113			0.11	%			117,424				109			0.12	%
Certificates of deposit		428,653				3,337			1.04	%			375,303				5,154			1.83	%
Total deposits		892,311				4,452			0.67	%			716,147				6,877			1.28	%
Advance payments by borrowers		10,020				3			0.04	%			8,226				3			0.05	%
Borrowings		122,203				1,927			2.11	%			118,701				1,850			2.08	%
Total interest-bearing liabilities		1,024,534				6,382			0.83	%			843,074				8,730			1.38	%
Non-interest-bearing liabilities:
Non-interest-bearing demand		275,865				—							155,158				—
Other non-interest-bearing liabilities		12,182				—							5,927				—
Total non-interest-bearing liabilities		288,047				—							161,085				—
Total liabilities		1,312,581				6,382							1,004,159				8,730
Total equity		169,851											158,465
Total liabilities and total equity	$	1,482,432							0.83	%		$	1,162,624							1.38	%
Net interest income					$	42,064										$	30,296
Net interest rate spread (5)									3.77	%										3.32	%
Net interest-earning assets (6)	$	384,405										$	265,605
Net interest margin (7)									3.99	%										3.65	%
Average interest-earning assets to
interest-bearing liabilities									137.52	%										131.50	%

 

(1)	Annualized where appropriate.
(2)	Loans include loans and mortgage loans held for sale, at fair value.
(3)	Securities include available-for-sale securities and held-to-maturity securities.
(4)	Includes FHLBNY demand account and FHLBNY stock dividends.
(5)	Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average rate of interest-bearing liabilities.
(6)	Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
(7)	Net interest margin represents net interest income divided by average total interest-earning assets.

PDL Community Bancorp and Subsidiaries
Other Data

	As of
	September 30,				June 31,				March 31,				December 31,				September 30,
	2021				2021				2021				2020				2020
Other Data
Common shares issued		18,463,028				18,463,028				18,463,028				18,463,028				18,463,028
Less treasury shares		1,132,086				1,135,086				1,444,776				1,337,059				1,346,679
Common shares outstanding at end of period		17,330,942				17,327,942				17,018,252				17,125,969				17,116,349
Book value per share	$	10.03			$	9.92			$	9.47			$	9.32			$	9.25
Tangible book value per share	$	10.03			$	9.92			$	9.47			$	9.32			$	9.25

Contact:
Frank Perez
frank.perez@poncebank.net
718-931-9000

FAQ

What were PDLB's net income results for Q3 2021?

PDL Community Bancorp reported a net income of $2.1 million for Q3 2021.

How does PDLB's Q3 2021 net income compare to Q2 2021?

Net income decreased from $5.9 million in Q2 2021 to $2.1 million in Q3 2021.

What is the current deposit amount for PDLB as of September 30, 2021?

Deposits totaled $1.25 billion as of September 30, 2021.

How much did PDLB's net interest income increase in Q3 2021?

Net interest income increased by 12.4% from the previous quarter.

What is the efficiency ratio for PDLB in Q3 2021?

The efficiency ratio for PDL Community Bancorp was 78.89% in Q3 2021.