Dime Community Bancshares, Inc. Increases Fourth Quarter Net Income Available to Common Stockholders By 925% Year-Over-Year

GlobeNewsWire
Friday, January 28, 2022 at 11:00am UTC

Continued Increase in Non-Interest-Bearing Deposits Positions the Company Well for A Rising Interest Rate Scenario

Robust Quarterly Loan Originations in Excess of $500 Million

HAUPPAUGE, N.Y., Jan. 28, 2022 (GLOBE NEWSWIRE) -- Dime Community Bancshares, Inc. (NASDAQ: DCOM) (the “Company” or “Dime”), the parent company of Dime Community Bank (the “Bank”), today reported net income available to common stockholders of $96.7 million for the year ended December 31, 2021, or $2.45 per diluted common share.

For the quarter ended December 31, 2021, net income available to common stockholders was $33.5 million, or $0.83 per diluted common share, compared to net income available to common stockholders of $3.3 million for the quarter ended December 31, 2020, or $0.16 per diluted common share. Adjusted net income available to common stockholders (non-GAAP) totaled $33.8 million for the quarter ended December 31, 2021, or $0.84 per diluted share. Adjusted net income available to common stockholders includes $0.5 million of aggregate pre-tax adjustments related to merger expenses and transaction costs, branch restructuring, and net gain on sale of securities and other assets (see “Non-GAAP Reconciliation” table at the end of this news release).

Kevin M. O’Connor, Chief Executive Officer (“CEO”) of the Company, stated, “As we close the book on 2021, we can reflect on a successful year for our Company. We integrated our merger transaction seamlessly and delivered on our financial goals as it relates to return on assets and efficiency. During the fourth quarter of 2021, our loan originations increased to $505 million (representing a linked quarter increase of approximately 9%). In addition, we grew our non-interest-bearing deposits to total deposits ratio to 37.5% and have positioned our balance sheet favorably for a rising rate scenario.”

Highlights for the Fourth Quarter of 2021 Included:

  • The non-interest-bearing deposits to total deposits ratio increased to 37.5% at December 31, 2021;
  • The cost of deposits for the fourth quarter of 2021 declined to 0.11%;     
  • Total loans held for investment, net, excluding Paycheck Protection Program (“PPP”) loans increased by 1% on an annualized basis versus the linked quarter;
  • The reported efficiency ratio for the fourth quarter of 2021 was 49.9%; excluding the impact of merger expenses and transaction costs, branch restructuring, and amortization of other intangible assets, the adjusted efficiency ratio was 48.2%;
  • The Company repurchased 850,901 shares of its common stock, which represented approximately 2% of shares outstanding at the beginning of the period, at a weighted average price of $34.44; and
  • Non-performing assets represented only 0.33% of total assets as of December 31, 2021.

Management’s Discussion of Quarterly Operating Results

The Company’s results of operations for the third and fourth quarters of 2021 include income for the full quarter from the merger with Bridge Bancorp, Inc. (“Bridge”). The Company’s historical information for the fourth quarter of 2020 does not include the historical GAAP results of Bridge.

Net Interest Income

Net interest income for the fourth quarter of 2021 was $91.7 million compared to $94.8 million for the third quarter of 2021 and $48.7 million for the fourth quarter of 2020.

The table below provides a reconciliation of the reported Net Interest Margin (“NIM”), the adjusted NIM excluding the impact of PPP loans, and the adjusted NIM excluding the combined impact of PPP loans and purchasing accounting accretion on the loan portfolio.

($ in thousands) Q4 2021 Q3 2021 Q4 2020
Net interest income $ 91,686  $94,828  $48,680 
Less: Net interest income on PPP loans   (539)  (2,502)  (1,678)
Adjusted net interest income excluding PPP loans, (non-GAAP) $ 91,147  $92,326  $47,002 
          
Average interest-earning assets $ 11,582,086  $11,765,298  $6,281,488 
Average PPP loan balances   (96,065)  (266,472)  (318,793)
Adjusted average interest-earning assets excluding PPP loans, (non-GAAP) $ 11,486,021  $11,498,826  $5,962,695 
          
NIM (1)   3.14%   3.20%  3.10%
Adjusted NIM excluding PPP loans (non-GAAP) (2)   3.15%  3.19%  3.15%
          
Adjusted net interest income excluding PPP loans, (non-GAAP) $ 91,147  $92,326  $47,002 
Less: Purchase Accounting Accretion on loans ("PAA")   625   (2,541)   
Adjusted net interest income excluding PPP loans and PAA on loans, (non-GAAP) $ 91,772  $89,785  $47,002 
Adjusted NIM excluding PPP loans and PAA on loans, (non-GAAP) (3)   3.17%   3.10%  3.15%
          

(1)   NIM represents net interest income divided by average interest-earning assets.
(2)   Adjusted NIM excluding PPP represents adjusted net interest income, which excludes net interest income on PPP loans divided by average interest-earning assets excluding PPP loans. The net interest income on PPP loans is calculated using interest income on the PPP balances less an assumed cost of funding the PPP loans, using the overall cost of funds of the Company.
(3)  Adjusted NIM excluding PPP and PAA represents adjusted net interest income, which excludes net interest income on PPP loans and PAA, divided by adjusted average interest-earning assets excluding PPP loans.

Loan Portfolio

The ending weighted average rate (“WAR”)(1) on the total loan portfolio was 3.73% at December 31, 2021, a 1 basis point increase compared to the ending WAR on the total loan portfolio at September 30, 2021. Excluding the impact of PPP loans, the WAR on the loan portfolio was 3.75% at December 31, 2021, compared to 3.76% at September 30, 2021.

Outlined below are loan balances and WARs for the period ended as indicated.

  December 31, 2021 September 30, 2021 December 31, 2020 
($ in thousands)    Balance    WAR    Balance    WAR    Balance    WAR 
Loans held for investment balances at period end:                
One-to-four family residential, including condominium and cooperative apartment $ 669,282  3.63%  $683,665 3.68%$184,989 3.76%
Multifamily residential and residential mixed-use (2)(3)   3,356,346  3.56  3,468,262 3.57  2,758,743 3.75 
Non-owner-occupied commercial real estate ("CRE")   2,915,693  3.69  2,844,171 3.70  1,560,811 3.86 
Owner-occupied CRE   1,030,255  4.05  970,266 4.11  317,356 4.14 
Acquisition, development, and construction ("ADC")   322,628  4.53  285,379 4.69  156,296 5.02 
Commercial and industrial ("C&I")   867,542  4.08  878,332 4.10  319,626 4.49 
Other loans   16,898  5.85  20,713 4.97  2,316 7.63 
Loans held for investment excluding PPP   9,178,644  3.75  9,150,788 3.76  5,300,137 3.89 
                 
PPP   66,017  1.00  134,083 1.00  321,907 1.00 
Total loans held for investment including PPP $ 9,244,661  3.73%  $9,284,871 3.72%$5,622,044 3.73%
                 

(1)    Weighted average rate is calculated by aggregating interest based on the current loan rate from each loan in the category, adjusted for non-accrual loans, divided by the total amount of loans in the category.
(2)    Includes multifamily loans underlying cooperatives.
(3)   While the loans within this category are often considered "commercial real estate" in nature, multifamily and loans underlying cooperatives are here reported separately from commercial real estate loans in order to emphasize the residential nature of the collateral underlying this significant component of the total loan portfolio.

Outlined below are the loan originations, excluding PPP, for the quarter ended as indicated.

($ in millions) Q4 2021 Q3 2021    Q4 2020
Loan originations, excluding PPP $ 505.1 $464.9 $223.8
          

Deposits

Total deposits decreased by $215.1 million on a linked quarter basis to $10.5 billion at December 31, 2021. The decline in total deposits was primarily due to the Bank not renewing higher-cost certificates of deposit accounts.

CEO O’Connor stated, “We continued to focus on reducing higher-rate, promotional or rate-sensitive deposits in our portfolio as we prepare for higher interest rates. The weighted-average rate on our deposit portfolio declined to 0.09% at December 31, 2021.”

Non-interest-bearing deposits increased $98.6 million during the fourth quarter of 2021 to $3.9 billion at December 31, 2021, representing 37.5% of total deposits.

As of December 31, 2021, the Company had $324.9 million of certificates of deposits, with a weighted average rate of 0.29%, that were set to mature during the first quarter of 2022 and $376.3 million of certificates of deposits, with a weighted average rate of 0.69%, that were set to mature during the remainder of 2022.

Non-Interest Income

Non-interest income was $10.2 million during the fourth quarter of 2021, $9.7 million during the third quarter of 2021, and $2.5 million during the fourth quarter of 2020. Excluding the net gain on sale of securities and other assets, adjusted non-interest income was $9.2 million during the fourth quarter of 2021. The net gain on sale of securities and other assets during the fourth quarter of 2021 was primarily due to the sale of a branch property. Excluding the loss on termination of derivatives and net gain on sale of securities and other assets, adjusted non-interest income was $7.9 million during the fourth quarter of 2020 (see “Non-GAAP Reconciliation” table at the end of this news release).

Non-Interest Expense

Total non-interest expense was $50.8 million during the fourth quarter of 2021, $56.8 million during the third quarter of 2021, and $37.6 million during the fourth quarter of 2020. Excluding the impact of merger expenses and transaction costs, branch restructuring, and amortization of other intangible assets, adjusted non-interest expense was $48.7 million during the fourth quarter of 2021, compared to $49.1 million during the third quarter of 2021, and $25.3 million during the fourth quarter of 2020 (see “Non-GAAP Reconciliation” table at the end of this news release).

The ratio of non-interest expense to average assets was 1.64% during the fourth quarter of 2021, compared to 1.80% during the linked quarter and 2.28% for the fourth quarter of 2020. Excluding the impact of merger expenses and transaction costs, branch restructuring, and amortization of other intangible assets, the ratio of adjusted non-interest expense to average assets was 1.57% during the fourth quarter of 2021, compared to 1.56% during the linked quarter and 1.53% for the fourth quarter of 2020 (see “Non-GAAP Reconciliation” table at the end of this news release).

The efficiency ratio was 49.9% during the fourth quarter of 2021, compared to 54.3% during the linked quarter and 73.4% during the fourth quarter of 2020. Excluding the impact of merger expenses and transaction costs, branch restructuring, and amortization of other intangible assets, the adjusted efficiency ratio was 48.2% during the fourth quarter of 2021, compared to 46.9% during the linked quarter and 44.8% during the fourth quarter of 2020 (see “Non-GAAP Reconciliation” table at the end of this news release).

Income Tax Expense

The reported effective tax rate for the fourth quarter of 2021 was 30.9%, compared to 27.5% for the third quarter of 2021, and 31.5% for the fourth quarter of 2020. The increase in the effective tax rate during the fourth quarter of 2021 was primarily the result of higher non-deductible expenses during the period.

Credit Quality

Non-performing loans at December 31, 2021 were $40.3 million, or 0.44% of total loans.

Excluding the impact of purchased loans with credit deterioration (“PCD loans”), non-performing loans would have been $32.2 million, or 0.36% of total loans (excluding PCD loans).

A credit loss recovery of $132 thousand was recorded during the fourth quarter of 2021, compared to a credit loss recovery of $5.2 million during the third quarter of 2021, and a credit loss provision of $6.2 million during the fourth quarter of 2020.

The allowance for credit losses as a percentage of total loans was 0.91% at December 31, 2021 as compared to 0.88% at September 30, 2021 and 0.74% at December 31, 2020.

Loans with Payment Deferrals

Loans subject to full principal and interest (“P&I”) payment deferrals declined to $5.7 million and represented 0.1% of the total loan portfolio at December 31, 2021.

Capital Management

The Company’s and the Bank’s regulatory capital ratios continued to be in excess of all applicable regulatory requirements.

CEO O’Connor commented, “During the fourth quarter, we continued to execute on our share repurchase program and we repurchased $29.3 million of common stock. Our tangible equity to tangible assets ratio increased by 14 basis points in the quarter to 8.64%. Our strong balance sheet and internal stress testing analyses continue to provide support for future capital return to shareholders” (see “Non-GAAP Reconciliation” tables at the end of this news release).

Dividends per common share were $0.24 during the fourth quarter of 2021.

Book value per common share was $26.98 and tangible common book value per share (which represents common equity less goodwill and other intangible assets, divided by number of shares outstanding) was $22.87 at December 31, 2021 (see “Non-GAAP Reconciliation” tables at the end of this news release).

Earnings Call Information

The Company will conduct a conference call at 8:30 a.m. (ET) on January 28, 2022, during which CEO O’Connor will discuss the Company’s fourth quarter and fiscal year 2021 performance, with a question and answer session to follow. Dial-in information for the live call is 1-888-348-2672. Upon dialing in, request to be joined into Dime Community Bancshares, Inc. call with the conference operator.

The conference call will be simultaneously webcast (listen only), and archived for a period of one year, at https://services.choruscall.com/links/dcom220128.html. Dial-in information for the replay is 1-877-344-7529 using access code #6633695. Replay will be available beginning on January 28, 2022 at 10:30 a.m. through February 11, 2022 at 11:59 p.m.

ABOUT DIME COMMUNITY BANCSHARES, INC.
Dime Community Bancshares, Inc. is the holding company for Dime Community Bank, a New York State-chartered trust company with over $12.0 billion in assets and the number one deposit market share among community banks on Greater Long Island(1).

(1) Aggregate deposit market share for Kings, Queens, Nassau & Suffolk counties for community banks less than $20 billion in assets.

This news release contains a number of forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). These statements may be identified by use of words such as "anticipate," "believe," “continue,” "could," "estimate," "expect," "intend," “likely,” "may," "outlook," "plan," "potential," "predict," "project," "should," "will," "would" and similar terms and phrases, including references to assumptions.

Forward-looking statements are based upon various assumptions and analyses made by the Company in light of management's experience and its perception of historical trends, current conditions and expected future developments, as well as other factors it believes are appropriate under the circumstances. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors (many of which are beyond the Company's control) that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Accordingly, you should not place undue reliance on such statements. Factors that could affect our results include, without limitation, the following: the timing and occurrence or non-occurrence of events may be subject to circumstances beyond the Company’s control; there may be increases in competitive pressure among financial institutions or from non-financial institutions; changes in the interest rate environment may reduce interest margins; changes in deposit flows, loan demand or real estate values may adversely affect the business of the Company; unanticipated or significant increases in loan losses may negatively affect the Company’s financial condition or results of operations; changes in accounting principles, policies or guidelines may cause the Company’s financial condition to be perceived differently; changes in corporate and/or individual income tax laws may adversely affect the Company's financial condition or results of operations; general economic conditions, either nationally or locally in some or all areas in which the Company conducts business, or conditions in the securities markets or the banking industry may be less favorable than the Company currently anticipates; legislation or regulatory changes may adversely affect the Company’s business; technological changes may be more difficult or expensive than the Company anticipates; there may be failures or breaches of information technology security systems; success or consummation of new business initiatives may be more difficult or expensive than the Company anticipates; and litigation or other matters before regulatory agencies, whether currently existing or commencing in the future, may delay the occurrence or non-occurrence of events longer than the Company anticipates. Further, given its ongoing and dynamic nature, it is difficult to predict what effects the COVID-19 pandemic will have on our business and results of operations. The pandemic and related local and national economic disruption may, among other effects, result in a decline in demand for our products and services; increased levels of loan delinquencies, problem assets and foreclosures; branch closures, work stoppages and unavailability of personnel; and increased cybersecurity risks, as employees work remotely. For discussion of these and other risks that may cause actual results to differ from expectations, please refer to the sections entitled “Forward-Looking Statements” and “Risk Factors” in the Company’s Annual Report on Form 10-K and subsequent updates set forth in the Company’s Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.

Contact: Avinash Reddy
Senior Executive Vice President – Chief Financial Officer
718-782-6200 extension 5909

 

DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(In thousands)

     December 31,     September 30,     December 31,
  2021 2021 2020
Assets:           
Cash and due from banks $ 393,722  $629,011  $243,603 
Securities available-for-sale, at fair value   1,563,711   1,709,063   538,861 
Securities held-to-maturity   179,309   40,303    
Marketable equity securities, at fair value        5,970 
Loans held for sale   5,493   14,720   5,903 
Loans held for investment, net:          
One-to-four family and cooperative/condominium apartment   669,282   683,665   184,989 
Multifamily residential and residential mixed-use (1)(2)   3,356,346   3,468,262   2,758,743 
CRE   3,945,948   3,814,437   1,878,167 
ADC   322,628   285,379   156,296 
Total real estate loans   8,294,204   8,251,743   4,978,195 
C&I   867,542   878,332   319,626 
Small Business Administration ("SBA") Paycheck Protection Program ("PPP") loans   66,017   134,083   321,907 
Other loans   16,898   20,713   2,316 
Allowance for credit losses   (83,853)  (81,255)  (41,461)
Total loans held for investment, net   9,160,808   9,203,616   5,580,583 
Premises and fixed assets, net   50,368   49,615   19,053 
Premises held for sale   556   2,799    
Restricted stock   37,732   37,719   60,707 
Bank Owned Life Insurance ("BOLI")   295,789   293,898   156,096 
Goodwill   155,797   155,339   55,638 
Other intangible assets   8,362   9,077    
Operating lease assets   64,258   56,836   33,898 
Derivative assets   45,086   41,700   18,932 
Accrued interest receivable   40,149   43,284   34,815 
Other assets   65,224   77,401   27,551 
Total assets $ 12,066,364  $12,364,381  $6,781,610 
Liabilities:          
Non-interest-bearing checking $ 3,920,423  $3,821,832  $780,751 
Interest-bearing checking   905,717   989,526   290,300 
Savings   1,158,040   1,188,794   414,809 
Money market   3,621,552   3,657,669   1,716,624 
Certificates of deposit   853,242   1,016,216   1,322,638 
Total deposits   10,458,974   10,674,037   4,525,122 
FHLBNY advances   25,000   25,000   1,204,010 
Other short-term borrowings   1,862   2,629   120,000 
Subordinated debt, net   197,096   197,142   114,052 
Operating lease liabilities   66,103   62,870   39,874 
Derivative liabilities   40,728   38,889   37,374 
Other liabilities   83,981   162,697   40,082 
Total liabilities   10,873,744   11,163,264   6,080,514 
Stockholders' equity:          
Preferred stock, Series A   116,569   116,569   116,569 
Common stock   416   416   348 
Additional paid-in capital   494,125   493,775   278,295 
Retained earnings   654,726   630,744   600,641 
Accumulated other comprehensive loss, net of deferred taxes   (6,181)  (1,042)  (5,924)
Unearned equity awards   (7,842)  (9,417)   
Common stock held by the Benefit Maintenance Plan        (1,496)
Treasury stock, at cost   (59,193)  (29,928)  (287,337)
Total stockholders' equity   1,192,620   1,201,117   701,096 
Total liabilities and stockholders' equity $ 12,066,364  $12,364,381  $6,781,610 
             

(1)     Includes loans underlying multifamily cooperatives.
(2)     While the loans within this category are often considered "commercial real estate" in nature, multifamily and loans underlying cooperatives are here reported separately from commercial real estate loans in order to emphasize the residential nature of the collateral underlying this significant component of the total loan portfolio.

DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands except share and per share amounts)

  Three Months Ended  Year Ended
     December 31,     September 30,     December 31,     December 31,     December 31, 
  2021 2021 2020 2021 2020
Interest income:                
Loans $ 89,301  $94,045  $55,002  $ 359,016  $216,566 
Securities   7,097   6,030   3,365    22,634   14,159 
Other short-term investments   414   583   705    2,976   3,282 
Total interest income   96,812   100,658   59,072    384,626   234,007 
Interest expense:                 
Deposits and escrow   2,861   3,565   4,740    16,527   33,038 
Borrowed funds   2,265   2,265   5,652    10,490   23,265 
Total interest expense   5,126   5,830   10,392    27,017   56,303 
Net interest income   91,686   94,828   48,680    357,609   177,704 
(Credit) provision for credit losses   (132)  (5,187)  6,162    6,212   26,165 
Net interest income after (credit) provision   91,818   100,015   42,518    351,397   151,539 
                
Non-interest income:                 
Service charges and other fees   4,621   4,581   1,653    15,998   5,571 
Title fees   735   482       2,338    
Loan level derivative income   113   445   3,671    2,909   8,872 
BOLI income   1,890   2,249   1,028    7,071   4,859 
Gain on sale of SBA loans excluding PPP   851   348   146    2,336   1,118 
Gain on sale of PPP loans            20,697    
Gain on sale of residential loans   225   304   910    1,758   1,884 
Net gain on equity securities        222    131   361 
Net gain on sale of securities and other assets   975      1,235    1,705   4,592 
Loss on termination of derivatives        (6,596)   (16,505)  (6,596)
Other   769   1,319   233    3,630   612 
Total non-interest income   10,179   9,728   2,502    42,068   21,273 
Non-interest expense:                 
Salaries and employee benefits   27,638   28,276   15,726    108,331   60,756 
Severance            1,875   4,000 
Occupancy and equipment   7,784   7,814   4,116    30,697   16,177 
Data processing costs   4,506   3,573   2,152    16,638   8,329 
Marketing   1,959   1,054   318    4,661   1,458 
Professional services   2,130   2,751   681    9,284   3,394 
Federal deposit insurance premiums   1,031   1,173   490    4,077   2,257 
Loss on extinguishment of debt        1,104    1,751   1,104 
Curtailment (gain) loss        (1,651)   1,543   (1,651)
Merger expenses and transaction costs   2,574   2,472   12,829    44,824   15,256 
Branch restructuring   (1,118)  4,518       5,059    
Amortization of other intangible assets   715   715       2,622    
Other   3,610   4,437   1,824    13,937   6,748 
Total non-interest expense   50,829   56,783   37,589    245,299   117,828 
                
Income before taxes   51,168   52,960   7,431    148,166   54,984 
Income tax expense   15,811   14,565   2,339    44,170   12,666 
Net income   35,357   38,395   5,092    103,996   42,318 
Preferred stock dividends   1,821   1,822   1,821    7,286   4,783 
Net income available to common stockholders $ 33,536  $36,573  $3,271  $ 96,710  $37,535 
                
Earnings per common share ("EPS"):                 
Basic $ 0.83  $0.89  $0.16  $ 2.45  $1.74 
Diluted $ 0.83  $0.89  $0.16  $ 2.45  $1.74 
                
Average common shares outstanding for diluted EPS   39,876,825   40,426,161   21,233,018    38,903,037   21,538,448 
                     

DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED SELECTED FINANCIAL HIGHLIGHTS
(Dollars in thousands except per share amounts)

  At or For the Three Months Ended At or For the Year Ended  
     December 31,     September 30,    December 31,     December 31,     December 31,  
  2021 2021 2020 2021 2020 
Per Share Data:                
Reported EPS (Diluted) $ 0.83 $0.89 $0.16 $ 2.45 $1.74 
Cash dividends paid per common share   0.24  0.24  0.22   0.96  0.86 
Book value per common share   26.98  26.64  27.53   26.98  27.53 
Tangible common book value per share (1)   22.87  22.60  24.91   22.87  24.91 
Common shares outstanding   39,878  40,715  21,233   39,878  21,233 
Dividend payout ratio   28.92%   26.97% 135.03%  39.18% 49.79%
                 
Performance Ratios (Based upon Reported Net Income):                 
Return on average assets   1.14%   1.22% 0.31%  0.86% 0.66%
Return on average equity   11.67  12.69  2.89   8.96  6.30 
Return on average tangible common equity (1)   14.61  15.96  2.45   11.09  7.14 
Net interest margin   3.14  3.20  3.10   3.15  2.90 
Non-interest expense to average assets   1.64  1.80  2.28   2.03  1.83 
Efficiency ratio   49.9  54.3  73.4   61.4  59.2 
Effective tax rate   30.90  27.50  31.48   29.81  23.04 
                 
Balance Sheet Data:                 
Average assets $ 12,419,184 $12,584,372 $6,604,409 $ 12,112,800 $6,424,251 
Average interest-earning assets   11,582,086  11,765,298  6,281,488   11,354,111  6,122,643 
Average tangible common equity (1)   931,503  929,131  533,476   888,128  525,817 
Loan-to-deposit ratio at end of period   88.4  87.0  124.2   88.4  124.2 
                 
Capital Ratios and Reserves - Consolidated: (3)                 
Tangible common equity to tangible assets (1)   7.66%   7.54% 7.86%      
Tangible equity to tangible assets (1)   8.64  8.50  9.60       
Tier 1 common equity ratio   9.50  9.92  10.22       
Tier 1 risk-based capital ratio   10.71  11.17  12.44       
Total risk-based capital ratio   13.47  14.13  15.44       
Tier 1 leverage ratio   8.46  8.37  9.95       
CRE consolidated concentration ratio (2)   519  516  554       
Allowance for credit losses/ Total loans   0.91  0.88  0.74       
Allowance for credit losses/ Non-performing loans   208.04  238.84  231.26       
                 

(1)   See "Non-GAAP Reconciliation" table for reconciliation of tangible equity, tangible common equity, and tangible assets. Average balances are calculated using the ending balance for months during the period indicated.
(2)   The CRE concentration ratio is calculated using the sum of commercial real estate, excluding owner occupied commercial real estate, multifamily, and ADC, divided by consolidated capital. December 31, 2021 amounts are preliminary pending completion and filing of the Company’s regulatory reports.
(3)   December 31, 2021 amounts are preliminary pending completion and filing of the Company’s regulatory reports.

DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED AVERAGE BALANCES AND NET INTEREST INCOME
(Dollars in thousands)

  Three Months Ended 
  December 31, 2021 September 30, 2021 December 31, 2020 
                    Average             Average          Average 
  Average    Yield/ Average    Yield/ Average    Yield/ 
  Balance Interest Cost Balance Interest Cost Balance Interest Cost 
Assets:                            
Interest-earning assets:                            
Real estate loans $ 8,293,470 $ 78,367  3.75%  $8,289,973 $78,820 3.77%$4,966,327 $49,487 3.99%
Commercial and industrial loans   873,273   10,119  4.60  868,508  12,143 5.55  328,754  3,252 3.96 
SBA PPP loans   96,065   583  2.41  266,472  2,643 3.94  318,793  2,252 2.83 
Other loans   18,385   232  5.01  21,391  439 8.14  1,318  11 3.34 
Securities   1,729,191   7,097  1.63  1,438,348  6,030 1.66  498,861  3,365 2.70 
Other short-term investments   571,702   414  0.29  880,606  583 0.26  167,435  705 1.68 
Total interest-earning assets   11,582,086   96,812  3.32%   11,765,298  100,658 3.39% 6,281,488  59,072 3.76%
Non-interest-earning assets   837,098         819,074       322,921      
Total assets $ 12,419,184        $12,584,372      $6,604,409      
                          
Liabilities and Stockholders' Equity:                            
Interest-bearing liabilities:                            
Interest-bearing checking $ 962,597 $ 455  0.19%  $1,000,435 $388 0.15%$259,155 $142 0.22%
Money market   3,652,681   1,087  0.12  3,698,124  1,467 0.16  1,679,578  1,285 0.30 
Savings   1,174,719   108  0.04  1,335,310  170 0.05  408,241  141 0.14 
Certificates of deposit   915,210   1,211  0.52  1,138,853  1,540 0.54  1,333,079  3,172 0.95 
Total interest-bearing deposits   6,705,207   2,861  0.17  7,172,722  3,565 0.20  3,680,053  4,740 0.51 
FHLBNY advances   25,000   61  0.97  25,000  59 0.94  1,172,191  4,319 1.47 
Subordinated debt, net   197,126   2,204  4.44  197,172  2,206 4.44  114,028  1,330 4.64 
Other short-term borrowings   2,484     2,290     4,424  3 0.27 
Total borrowings   224,610   2,265  4.00  224,462  2,265 4.00  1,290,643  5,652 1.74 
Total interest-bearing liabilities   6,929,817   5,126  0.29%   7,397,184  5,830 0.31% 4,970,696  10,392 0.83%
Non-interest-bearing checking   4,096,046         3,789,623       795,204      
Other non-interest-bearing liabilities   181,074         186,977       132,826      
Total liabilities   11,206,937         11,373,784       5,898,726      
Stockholders' equity   1,212,247         1,210,588       705,683      
Total liabilities and stockholders' equity $ 12,419,184        $12,584,372      $6,604,409      
Net interest income     $ 91,686       $94,828      $48,680   
Net interest rate spread          3.03%        3.08%      2.93%
Net interest margin          3.14%        3.20%        3.10%
Deposits (including non-interest-bearing checking accounts) $ 10,801,253 $ 2,861  0.11%  $10,962,345 $3,565 0.13%$4,475,257 $4,740 0.42%
                          

DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED SCHEDULE OF NON-PERFORMING ASSETS
(Dollars in thousands)

     At or For the Three Months Ended
  December 31,     September 30,     December 31, 
Asset Quality Detail 2021 2021 2020
Non-performing loans ("NPLs") (1)          
One-to-four family residential, including condominium and cooperative apartment $ 7,623  $4,938  $858 
Multifamily residential and residential mixed-use     859   1,863 
CRE   5,053   4,122   2,704 
ADC         
C&I   27,266   23,727   12,502 
Other   365   374   1 
Total Non-accrual loans $ 40,307  $34,020  $17,928 
Total Non-performing assets ("NPAs") $ 40,307  $34,020  $17,928 
          
Loans 90 days delinquent and accruing ("90+ Delinquent")          
One-to-four family residential, including condominium and cooperative apartment $ 1,945  $5,021  $44 
Multifamily residential and residential mixed-use        437 
CRE     1,004    
ADC         
C&I   1,056   257   2,848 
Other         
90+ Delinquent $ 3,001  $6,282  $3,329 
          
NPAs and 90+ Delinquent $ 43,308  $40,302  $21,257 
          
NPAs and 90+ Delinquent / Total assets  0.36%  0.33%  0.31%
Net charge-offs (recoveries) ("NCOs") $ (108) $4,191  $13,193 
NCOs / Average loans (1)  0.00%  0.18%  0.94%
          

(1)   Excludes loans held for sale

DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
NON-GAAP RECONCILIATION
(Dollars in thousands except per share amounts)

The following tables below provide a reconciliation of certain financial measures calculated under generally accepted accounting principles ("GAAP") (as reported) and non-GAAP measures. A non-GAAP financial measure is a numerical measure of historical or future financial performance, financial position or cash flows that excludes or includes amounts that are required to be disclosed in the most directly comparable measure calculated and presented in accordance with GAAP in the United States. The Company’s management believes the presentation of non-GAAP financial measures provide investors with a greater understanding of the Company’s operating results in addition to the results measured in accordance with GAAP. While management uses these non-GAAP measures in its analysis of the Company’s performance, this information should not be viewed as a substitute for financial results determined in accordance with GAAP or considered to be more important than financial results determined in accordance with GAAP.

The following non-GAAP financial measures exclude pre-tax income and expenses associated with the Company’s merger with Bridge, as well as branch restructuring, and gain on sale of PPP loans.

  Three Months Ended  Year Ended
     December 31,     September 30,     December 31,     December 31,  December 31, 
  2021 2021 2020 2021 2020
Reconciliation of Reported and Adjusted (non-GAAP) Net Income Available to Common Stockholders               
Reported net income available to common stockholders $ 33,536  $36,573  $3,271  $ 96,710  $37,535 
Adjustments to net income (1):                
Provision for credit losses - Non-PCD loans (double-count)            20,278    
Gain on sale of PPP loans            (20,697)   
Net gain on sale of securities and other assets   (975)     (1,235)   (1,685)  (4,592)
Loss on termination of derivatives        6,596    16,505   6,596 
Severance            1,875   4,000 
Loss on extinguishment of debt        1,104    1,751   1,104 
Curtailment (gain) loss        (1,651)   1,543   (1,651)
Merger expenses and transaction costs (2)   2,574   2,472   12,829    44,824   15,256 
Branch restructuring   (1,118)  4,518       5,059    
Income tax effect of adjustments and other tax adjustments   (234)  (2,191)  (4,901)   (19,421)  (5,537)
Adjusted net income available to common stockholders (non-GAAP) $ 33,783  $41,372  $16,013  $ 146,742  $52,711 
                
Adjusted Ratios (Based upon non-GAAP as calculated above)               
Adjusted EPS (Diluted) $ 0.84  $1.01  $0.76  $ 3.73  $2.44 
Adjusted return on average assets   1.15%   1.37%  1.08%   1.27%  0.89%
Adjusted return on average equity   11.75   14.27   10.11    13.26   8.56 
Adjusted return on average tangible common equity   14.72   18.02   12.01    16.73   10.02 
Adjusted non-interest expense to average assets   1.57   1.56   1.53    1.55   1.54 
Adjusted efficiency ratio   48.2   46.9   44.8    47.6   49.3 
                     

(1)    Adjustments to net income are taxed at the Company's statutory tax rate of approximately 31% unless otherwise noted.
(2)    Certain merger expenses and transaction costs are non-taxable expense.

The following table presents a reconciliation of operating expense as a percentage of average assets (as reported) and adjusted operating expense as a percentage of average assets (non-GAAP):

  Three Months Ended  Year Ended
     December 31, September 30, December 31, December 31, December 31,
  2021 2021 2020 2021 2020
Operating expense as a % of average assets - as reported  1.64% 1.80% 2.28%  2.03% 1.83%
Loss on extinguishment of debt     (0.07)  (0.01) (0.02)
Curtailment gain (loss)     0.10   (0.02) 0.03 
Severance        (0.02) (0.06)
Merger expenses and transaction costs  (0.08) (0.08) (0.78)  (0.37) (0.24)
Branch restructuring  0.03  (0.14)    (0.04)  
Amortization of other intangible assets  (0.02) (0.02)    (0.02)  
Adjusted operating expense as a % of average assets (non-GAAP)  1.57  1.56  1.53   1.55  1.54 
                

The following table presents a reconciliation of efficiency ratio (non-GAAP) and adjusted efficiency ratio (non-GAAP):

  Three Months Ended Year Ended
     December 31,    September 30,    December 31,    December 31, December 31,
  2021 2021 2020 2021 2020
Efficiency ratio - as reported (non-GAAP) (1)      49.9%  54.3%  73.4%   61.4%  59.2%
Non-interest expense - as reported $ 50,829  $56,783  $37,589  $ 245,299  $117,828 
Less: Severance            (1,875)  (4,000)
Less: Merger expenses and transaction costs   (2,574)  (2,472)  (12,829)   (44,824)  (15,256)
Less: Branch restructuring   1,118   (4,518)      (5,059)   
Less: Loss on extinguishment of debt        (1,104)   (1,751)  (1,104)
Less: Curtailment gain (loss)        1,651    (1,543)  1,651 
Less: Amortization of other intangible assets   (715)  (715)      (2,622)   
Adjusted non-interest expense (non-GAAP) $ 48,658  $49,078  $25,307  $ 187,625  $99,119 
Net interest income - as reported $ 91,686  $94,828  $48,680  $ 357,609  $177,704 
Non-interest income - as reported $ 10,179  $9,728  $2,502  $ 42,068  $21,273 
Less: Gain on sale of PPP loans            (20,697)   
Less: Net gain on sale of securities and other assets   (975)     (1,235)   (1,685)  (4,592)
Less: Loss on termination of derivatives        6,596    16,505   6,596 
Adjusted non-interest income (non-GAAP) $ 9,204  $9,728  $7,863  $ 36,191  $23,277 
Adjusted total revenues for adjusted efficiency ratio (non-GAAP) $ 100,890  $104,556  $56,543  $ 393,800  $200,981 
Adjusted efficiency ratio (non-GAAP) (2)    48.2%   46.9%  44.8%   47.6%  49.3%
                     

_______________
(1)   
The reported efficiency ratio is a non-GAAP measure calculated by dividing GAAP non-interest expense by the sum of GAAP net interest income and GAAP non-interest (loss) income.
(2)   The adjusted efficiency ratio is a non-GAAP measure calculated by dividing adjusted non-interest expense by the sum of GAAP net interest income and adjusted non-interest income.

The following table presents the tangible common equity to tangible assets, tangible equity to tangible assets, and tangible common book value per share calculations (non-GAAP):

     December 31,     September 30,     December 31, 
  2021 2021 2020
Reconciliation of Tangible Assets:         
Total assets $ 12,066,364  $12,364,381  $6,781,610 
Less:         
Goodwill   (155,797)  (155,339)  (55,638)
Other intangible assets   (8,362)  (9,077)   
Tangible assets (non-GAAP) $ 11,902,205  $12,199,965  $6,725,972 
          
Reconciliation of Tangible Common Equity - Consolidated:         
Total stockholders' equity $ 1,192,620  $1,201,117  $701,096 
Less:         
Goodwill   (155,797)  (155,339)  (55,638)
Other intangible assets   (8,362)  (9,077)   
Tangible equity (non-GAAP)   1,028,461   1,036,701   645,458 
Less:         
Preferred stock, net   (116,569)  (116,569)  (116,569)
Tangible common equity (non-GAAP) $ 911,892  $920,132  $528,889 
          
Common shares outstanding   39,878   40,715   21,233 
          
Tangible common equity to tangible assets (non-GAAP)   7.66%   7.54%  7.86%
Tangible equity to tangible assets (non-GAAP)   8.64   8.50   9.60 
          
Book value per share $26.98  $26.64  $27.53 
Tangible common book value per share (non-GAAP)  22.87   22.60   24.91 
             

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