Dime Community Bancshares, Inc. Increases Net Income Available to Common Stockholders By 160% Year-Over-Year

Dime Community Bancshares, Inc.
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Non-Interest-Bearing Deposits Increase to 36%, Positioning the Company Well for A Rising Interest Rate Scenario

HAUPPAUGE, N.Y., Oct. 29, 2021 (GLOBE NEWSWIRE) -- Dime Community Bancshares, Inc. (NASDAQ: DCOM) (the “Company” or “Dime” or “its”), the parent company of Dime Community Bank (the “Bank”), today reported net income available to common stockholders of $36.6 million for the quarter ended September 30, 2021, or $0.89 per diluted common share, compared with net income available to common stockholders of $14.0 million for the quarter ended September 30, 2020, or $0.65 per diluted common share. For the quarter ended June 30, 2021, net income available to common stockholders was $49.5 million, or $1.19 per diluted common share.

Adjusted net income to common stockholders (non-GAAP) totaled $41.4 million for the quarter ended September 30, 2021, or $1.01 per diluted share1. Adjusted net income to common stockholders includes the following primary adjustments:

  • Branch restructuring costs: As previously disclosed, the Company combined five branch locations into other existing branches in October 2021; associated branch restructuring costs were $4.5 million during the quarter, pre-tax; and

  • Merger expenses and transaction costs: The Company recorded merger expenses and transaction costs, associated with its February 2021 merger of equals transaction, of $2.5 million, pre-tax, during the quarter.

Kevin M. O’Connor, Chief Executive Officer (“CEO”) of the Company, stated, “We continue to improve the quality of our deposit base, as evidenced by non-interest-bearing accounts growing to 36% of total deposits. Our high level of non-interest-bearing deposits, coupled with a balance sheet that does not rely on wholesale leverage, positions us well for the time when the Federal Reserve begins raising interest rates. In the third quarter, we saw a resumption of loan growth (excluding Small Business Administration (“SBA”) Paycheck Protection Program (“PPP”) loans) and we continue to maintain healthy pipelines. Finally, we continue to focus on prudent expense management as demonstrated by a core efficiency ratio of 47% for the third quarter.”

Highlights for the Third Quarter of 2021 Included:

  • The non-interest-bearing deposits to total deposits ratio increased to 35.8% at September 30, 2021;

  • The cost of deposits for the third quarter of 2021 declined to 0.13%;

  • Total loans held for investment, net, excluding PPP loans increased by 4% on an annualized basis versus the linked quarter;

  • The Company purchased 480,039 shares of its common stock, at a weighted average price of $32.15 per share;

  • Non-performing assets represent only 0.28% of total assets as of September 30, 2021; and

  • The Company’s Adjusted Pre-tax Pre-provision Net Revenue (“PPNR”) for the third quarter was $54.8 million compared to $52.7 million for the second quarter.1

1 See reconciliation of this non-GAAP financial measure provided elsewhere herein.

Management’s Discussion of Quarterly Operating Results

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

Net Interest Income

Net interest income for the third quarter of 2021 was $94.8 million compared to $93.3 million for the second quarter of 2021 and $44.9 million for the third 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)

Q3 2021

Q2 2021

Q3 2020

Net interest income

$

94,828

$

93,254

$

44,944

Less: Net interest income on PPP loans

(2,502

)

(5,375

)

(1,471

)

Adjusted net interest income excluding PPP loans, (non-GAAP)

$

92,326

$

87,879

$

43,473

Average interest-earning assets

$

11,765,298

$

11,990,107

$

6,164,452

Average PPP loan balances

(266,472

)

(1,282,347

)

(316,747

)

Adjusted average interest-earning assets excluding PPP loans, (non-GAAP)

$

11,498,826

$

10,707,760

$

5,847,705

NIM (1)

3.20

%

3.12

%

2.92

%

Adjusted NIM excluding PPP loans (non-GAAP) (2)

3.19

%

3.29

%

2.95

%

Adjusted net interest income excluding PPP loans, (non-GAAP)

$

92,326

$

87,879

$

43,473

Less: Purchase Accounting Accretion on loans ("PAA")

(2,541

)

(1,925

)

—

Adjusted net interest income excluding PPP loans and PAA on loans, (non-GAAP)

$

89,785

$

85,954

$

43,473

Adjusted NIM excluding PPP loans and PAA on loans, (non-GAAP) (3)

3.10

%

3.23

%

2.95

%


(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-bearing liabilities 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 excluding PPP loans and PAA, divided by adjusted average interest-earning assets, excluding PPP loans.


Loan Portfolio

The ending weighted average rate (“WAR”) on the total loan portfolio was 3.72% at September 30, 2021, a 6 basis point increase compared to the ending WAR on the total loan portfolio at June 30, 2021. Excluding the impact of PPP loans, the WAR on the loan portfolio was 3.76% at September 30, 2021, compared to 3.79% at June 30, 2021.

Outlined below are loan balances and WARs(1) for the current quarter, linked quarter and prior year quarter.

September 30, 2021

June 30, 2021

September 30, 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

$

683,665

3.68

%

$

704,489

3.72

%

$

186,975

3.97

%

Multifamily residential and residential mixed-use (2)(3)

3,468,262

3.57

3,503,205

3.59

2,919,186

3.77

CRE

3,814,437

3.80

3,681,331

3.83

1,675,488

4.00

ADC

285,379

4.69

290,462

4.73

151,866

5.04

C&I

878,332

4.10

878,331

4.16

323,972

4.49

Other loans

20,713

4.97

23,275

4.99

1,448

7.56

Loans held for investment excluding PPP

9,150,788

3.76

9,081,093

3.79

5,258,935

3.93

PPP

134,083

1.00

465,538

1.00

318,568

1.00

Total loans held for investment including PPP

$

9,284,871

3.72

%

$

9,546,631

3.66

%

$

5,577,503

3.76

%


(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 current quarter, linked quarter and prior year.

($ in millions)

Q3 2021

Q2 2021

Q3 2020

Loan originations, excluding PPP

$

464.9

$

425.7

$

318.9

Deposits and Borrowed Funds

Total deposits decreased by $392.2 million on a linked quarter basis to $10.7 billion at September 30, 2021. The decline in total deposits was primarily due to the Company not renewing higher-cost certificates of deposit accounts. Mr. O’ Connor stated, “We continue to focus on reducing any high-rate, promotional or rate-sensitive deposits from our portfolio as we prepare for higher interest rates. The weighted average rate on our deposit portfolio declined to 0.11% at September 30, 2021.”

Non-interest-bearing deposits increased $132.8 million during the third quarter of 2021 to $3.8 billion at September 30, 2021, representing 35.8% of total deposits.

As of September 30, 2021, the Company had $311.7 million of certificates of deposits, with a weighted average rate of 0.33%, that were set to mature during the fourth quarter of 2021.

Total Federal Home Loan Bank advances were $25.0 million at September 30, 2021 and June 30, 2021.

Non-Interest Income

Non-interest income was $9.7 million during the third quarter of 2021, $29.5 million during the second quarter of 2021, and $6.1 million during the third quarter of 2020. Excluding a $20.7 million gain on sale of PPP loans during the second quarter of 2021, adjusted non-interest income was $8.8 million during the second quarter of 2021. Excluding the gain on sale of securities and other assets, adjusted non-interest income was $5.9 million during the third quarter of 2020 (see “Non-GAAP Reconciliation” table at the end of this news release).

Non-Interest Expense

Total non-interest expense was $56.8 million during the third quarter of 2021, $54.9 million during the second quarter of 2021, and $24.9 million during the third quarter of 2020. Excluding the impact of merger expenses and transaction costs, branch restructuring costs, and amortization of other intangible assets, adjusted non-interest expense was $49.1 million during the third quarter of 2021, compared to $48.5 million during the second quarter of 2021, and $24.1 million during the third 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 1.80% during the third quarter of 2021, compared to 1.72% during the linked quarter and 1.53% for the third quarter of 2020. Excluding the impact of merger expenses and transaction costs, branch restructuring costs, and amortization of other intangible assets, the ratio of adjusted non-interest expense to average assets was 1.56% during the third quarter of 2021, compared to 1.52% during the linked quarter and 1.48% for the third quarter of 2020 (see “Non-GAAP Reconciliation” table at the end of this news release).

The efficiency ratio was 54.3% during the third quarter of 2021, compared to 44.7% during the linked quarter and 48.6% during the third quarter of 2020. Excluding the impact of merger expenses and transaction costs, branch restructuring costs, and amortization of other intangible assets, the adjusted efficiency ratio was 46.9% during the third quarter of 2021, compared to 47.5% during the linked quarter and 47.3% during the third 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 third quarter of 2021 was 27.5%, compared to 28.9% for the second quarter of 2021, and 21.9% for the third quarter of 2020. The decrease in the effective tax rate during the third quarter of 2021 was primarily the result of the decrease in taxable income and lower non-deductible expenses during the period. The effective tax rate for the remainder of 2021 is expected to be approximately 27.5%.

Credit Quality

Non-performing loans at September 30, 2021 were $34.0 million, or 0.37% of total loans. Non-performing loans, excluding acquired PCD loans, would have been $30.1 million, or 0.34% of total loans excluding acquired PCD loans.

A credit loss recovery of $5.2 million was recorded during the third quarter of 2021, compared to a credit loss recovery of $4.2 million during the second quarter of 2021, and a credit loss provision of $5.9 million during the third quarter of 2020. The credit loss recovery of $5.2 million for the third quarter of 2021 was primarily associated with a reduction in reserves on acquired PCD loans, given the improvement in economic conditions since the time of the merger closing.

The allowance for credit losses as a percentage of total loans was 0.88% at September 30, 2021 as compared to 0.97% at June 30, 2021 and 0.87% at September 30, 2020. Excluding PPP loans, the ratio of allowance for credit losses at September 30, 2021 would have been 0.89%.

Loans with Payment Deferrals

Full principal and interest (“P&I”) deferrals declined to $26.6 million and represented 0.3% of the total loan portfolio at September 30, 2021.

Capital Management

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

Mr. O’Connor commented, “In August, our Board of Directors approved a new stock repurchase program which authorized the purchase of 5% of outstanding common stock. Our strong balance sheet and internal stress testing analysis results have allowed us to return excess capital to our shareholders. In the third quarter we repurchased 480,039 shares, totaling $15.4 million and we continue to be active on the repurchase front into the fourth quarter.”

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

Book value per common share was $26.64 and tangible common book value per share (which represents common equity less goodwill and other intangible assets, divided by number of shares outstanding) was $22.60 at September 30, 2021 (see “Non-GAAP Reconciliation” tables at the end of this news release).

Including the impact of the remaining unrecognized fees on PPP loans, net of tax, adjusted tangible common book value per share would have been $22.61 (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 October 29, 2021, during which Kevin M. O’Connor, CEO, will discuss the Company’s third quarter 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/dcom211029.html. Dial-in information for the replay is 1-877-344-7529 using access code #10160977. Replay will be available October 29, 2021 (10:30 a.m.) through November 12, 2021 (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 $12.3 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 and/or the Bank; 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 increasingly work remotely.

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)

September 30,

June 30,

December 31,

2021

2021

2020

Assets:

Cash and due from banks

$

629,011

$

1,184,183

$

243,603

Mortgage-backed securities available-for-sale, at fair value

1,212,383

863,239

426,979

Investment securities available-for-sale, at fair value

496,680

398,549

111,882

Investment securities held-to-maturity

40,303

—

—

Marketable equity securities, at fair value

—

—

5,970

Loans held for sale

14,720

29,335

5,903

Loans held for investment, net:

One-to-four family and cooperative/condominium apartment

683,665

704,489

184,989

Multifamily residential and residential mixed-use (1)(2)

3,468,262

3,503,205

2,758,743

Commercial real estate ("CRE")

3,814,437

3,681,331

1,878,167

Acquisition, development, and construction ("ADC")

285,379

290,462

156,296

Total real estate loans

8,251,743

8,179,487

4,978,195

Commercial and industrial ("C&I")

878,332

878,331

319,626

Small Business Administration ("SBA") Paycheck Protection Program ("PPP") loans

134,083

465,538

321,907

Other loans

20,713

23,275

2,316

Allowance for credit losses

(81,255

)

(92,760

)

(41,461

)

Total loans held for investment, net

9,203,616

9,453,871

5,580,583

Premises and fixed assets, net

49,615

51,127

19,053

Premises held for sale

2,799

2,799

—

Restricted stock

37,719

22,449

60,707

Bank Owned Life Insurance ("BOLI")

293,898

293,113

156,096

Goodwill

155,339

155,339

55,638

Other intangible assets

9,077

9,792

—

Operating lease assets

56,836

69,189

33,898

Derivative assets

41,700

45,439

18,932

Accrued interest receivable

43,284

47,209

34,815

Other assets

77,401

78,052

27,551

Total assets

$

12,364,381

$

12,703,685

$

6,781,610

Liabilities:

Non-interest-bearing checking

$

3,821,832

$

3,689,072

$

780,751

Interest-bearing checking

989,526

1,101,038

290,300

Savings

1,188,794

1,305,028

414,809

Money market

3,657,669

3,670,090

1,716,624

Certificates of deposit

1,016,216

1,300,965

1,322,638

Total deposits

10,674,037

11,066,193

4,525,122

FHLBNY advances

25,000

25,000

1,204,010

Other short-term borrowings

2,629

1,841

120,000

Subordinated debt, net

197,142

197,188

114,052

Operating lease liabilities

62,870

72,170

39,874

Derivative liabilities

38,889

42,892

37,374

Other liabilities

162,697

94,125

40,082

Total liabilities

11,163,264

11,499,409

6,080,514

Stockholders' equity:

Preferred stock, Series A

116,569

116,569

116,569

Common stock

416

416

348

Additional paid-in capital

493,775

492,848

278,295

Retained earnings

630,744

613,791

600,641

Accumulated other comprehensive (loss) gain, net of deferred taxes

(1,042

)

4,576

(5,924

)

Unearned equity awards

(9,417

)

(8,529

)

—

Common stock held by the Benefit Maintenance Plan

—

—

(1,496

)

Treasury stock, at cost

(29,928

)

(15,395

)

(287,337

)

Total stockholders' equity

1,201,117

1,204,276

701,096

Total liabilities and stockholders' equity

$

12,364,381

$

12,703,685

$

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

Nine Months Ended

September 30,

June 30,

September 30,

September 30,

September 30,

2021

2021

2020

2021

2020

Interest income:

Loans

$

94,045

$

94,288

$

53,245

$

269,715

$

161,564

Securities

6,030

5,126

3,422

15,536

10,794

Other short-term investments

583

987

729

2,563

2,577

Total interest income

100,658

100,401

57,396

287,814

174,935

Interest expense:

Deposits and escrow

3,565

4,803

6,672

13,666

28,298

Borrowed funds

2,265

2,344

5,780

8,225

17,613

Total interest expense

5,830

7,147

12,452

21,891

45,911

Net interest income

94,828

93,254

44,944

265,923

129,024

(Credit) provision for credit losses

(5,187

)

(4,248

)

5,931

6,344

20,003

Net interest income after (credit) provision

100,015

97,502

39,013

259,579

109,021

Non-interest income:

Service charges and other fees

4,581

3,876

1,632

11,377

3,918

Title fees

482

688

—

1,603

—

Loan level derivative income

445

559

1,544

2,796

5,201

BOLI income

2,249

1,593

1,033

5,181

3,831

Gain on sale of SBA loans excluding PPP

348

973

808

1,485

972

Gain on sale of PPP loans

—

20,697

—

20,697

—

Gain on sale of residential loans

304

506

617

1,533

974

Net gain on equity securities

—

—

175

131

139

Net gain on sale of securities and other assets

—

20

215

730

3,357

Loss on termination of derivatives

—

—

—

(16,505

)

—

Other

1,319

632

125

2,861

379

Total non-interest income

9,728

29,544

6,149

31,889

18,771

Non-interest expense:

Salaries and employee benefits

28,276

27,598

14,316

80,693

45,030

Severance

—

1,875

—

1,875

4,000

Occupancy and equipment

7,814

8,122

4,046

22,913

12,061

Data processing costs

3,573

5,031

2,146

12,132

6,177

Marketing

1,054

788

345

2,702

1,140

Professional services

2,751

2,538

935

7,154

2,713

Federal deposit insurance premiums

1,173

934

761

3,046

1,767

Loss on extinguishment of debt

—

157

—

1,751

—

Curtailment loss

—

—

—

1,543

—

Merger expenses and transaction costs

2,472

1,836

769

42,250

2,427

Branch restructuring costs

4,518

1,659

—

6,177

—

Amortization of other intangible assets

715

835

—

1,907

—

Other

4,437

3,509

1,535

10,327

4,924

Total non-interest expense

56,783

54,882

24,853

194,470

80,239

Income before taxes

52,960

72,164

20,309

96,998

47,553

Income tax expense

14,565

20,886

4,441

28,359

10,327

Net income

38,395

51,278

15,868

68,639

37,226

Preferred stock dividends

1,822

1,822

1,822

5,465

2,962

Net income available to common stockholders

$

36,573

$

49,456

$

14,046

$

63,174

$

34,264

Earnings per common share ("EPS"):

Basic

$

0.89

$

1.19

$

0.66

$

1.62

$

1.57

Diluted

$

0.89

$

1.19

$

0.65

$

1.62

$

1.56

Average common shares outstanding for diluted EPS

40,426,161

40,981,585

21,324,187

38,574,857

21,791,080


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 Nine Months Ended

September 30,

June 30,

September 30,

September 30,

September 30,

2021

2021

2020

2021

2020

Per Share Data:

Reported EPS (Diluted)

$

0.89

$

1.19

$

0.65

$

1.62

$

1.56

Cash dividends paid per common share

0.24

0.24

0.22

0.72

0.65

Book value per common share

26.64

26.43

26.97

Tangible common book value per share (1)

22.60

22.41

24.37

Common shares outstanding

40,715

41,160

21,416

Dividend payout ratio

26.97

%

20.17

%

33.33

%

44.44

%

41.58

%

Performance Ratios (Based upon Reported Net Income):

Return on average assets

1.22

%

1.61

%

0.98

%

0.76

%

0.78

%

Return on average equity

12.69

17.22

9.22

8.00

7.59

Return on average tangible common equity (1)

15.96

22.02

10.88

9.84

8.76

Net interest margin

3.20

3.12

2.92

3.15

2.83

Non-interest expense to average assets

1.80

1.72

1.53

2.16

1.68

Efficiency ratio

54.3

44.7

48.6

65.3

54.3

Effective tax rate

27.50

28.94

21.87

29.24

21.72

Balance Sheet Data:

Average assets

$

12,584,372

$

12,756,909

$

6,492,173

$

12,009,522

$

6,363,768

Average interest-earning assets

11,765,298

11,990,107

6,164,452

11,277,257

6,069,115

Average tangible common equity (1)

929,131

908,747

516,189

873,481

521,385

Loan-to-deposit ratio at end of period

87.0

86.3

125.3

Capital Ratios and Reserves - Consolidated: (3)

Tangible common equity to tangible assets (1)

7.54

%

7.36

%

7.95

%

Tangible equity to tangible assets (1)

8.50

8.29

9.73

Tier 1 common equity ratio

9.92

10.06

10.69

Tier 1 risk-based capital ratio

11.17

11.34

13.02

Total risk-based capital ratio

14.13

14.45

16.30

Tier 1 leverage ratio

8.37

8.24

10.10

CRE consolidated concentration ratio (2)

516

506

545

Allowance for credit losses/ Total loans

0.88

0.97

0.87

Allowance for credit losses/ Non-performing loans

238.84

327.94

390.31


(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. September 30, 2021 amounts are preliminary pending completion and filing of the Company’s regulatory reports.

(3)

September 30, 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

September 30, 2021

June 30, 2021

September 30, 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

$

8,234,182

$

78,626

3.79

%

$

8,156,368

$

74,437

3.66

%

$

4,874,780

$

47,482

3.90

%

Commercial and industrial loans

923,698

12,337

5.30

932,297

13,277

5.71

326,636

3,574

4.38

SBA PPP loans

266,472

2,643

3.94

1,282,347

6,174

1.93

316,747

2,178

2.75

Other loans

21,992

439

7.92

24,349

400

6.59

1,444

11

3.05

Mortgage-backed securities

976,198

3,999

1.63

825,949

3,483

1.69

435,920

2,707

2.48

Investment securities

462,150

2,031

1.74

312,012

1,643

2.11

78,405

715

3.65

Other short-term investments

880,606

583

0.26

456,785

987

0.87

130,520

729

2.23

Total interest-earning assets

11,765,298

100,658

3.39

%

11,990,107

100,401

3.36

%

6,164,452

57,396

3.72

%

Non-interest-earning assets

819,074

766,802

327,721

Total assets

$

12,584,372

$

12,756,909

$

6,492,173

Liabilities and Stockholders' Equity:

Interest-bearing liabilities:

Interest-bearing checking

$

1,000,435

$

388

0.15

%

$

1,067,043

$

501

0.19

%

$

241,248

$

186

0.31

%

Money market

3,698,124

1,467

0.16

3,712,344

1,941

0.21

1,696,297

1,858

0.44

Savings

1,335,310

170

0.05

1,189,460

212

0.07

405,582

170

0.17

Certificates of deposit

1,138,853

1,540

0.54

1,421,480

2,149

0.61

1,425,083

4,458

1.24

Total interest-bearing deposits

7,172,722

3,565

0.20

7,390,327

4,803

0.26

3,768,210

6,672

0.70

FHLBNY advances

25,000

59

0.94

145,324

132

0.36

1,040,127

4,448

1.70

Subordinated debt, net

197,172

2,206

4.44

197,218

2,211

4.50

113,992

1,330

4.64

Other short-term borrowings

2,290

—

—

5,514

1

0.07

5,283

2

0.12

Total borrowings

224,462

2,265

4.00

348,056

2,344

2.70

1,159,402

5,780

1.99

Total interest-bearing liabilities

7,397,184

5,830

0.31

%

7,738,383

7,147

0.37

%

4,927,612

12,452

1.01

%

Non-interest-bearing checking

3,789,623

3,652,482

652,880

Other non-interest-bearing liabilities

186,977

175,031

223,285

Total liabilities

11,373,784

11,565,896

5,803,777

Stockholders' equity

1,210,588

1,191,013

688,396

Total liabilities and stockholders' equity

$

12,584,372

$

12,756,909

$

6,492,173

Net interest income

$

94,828

$

93,254

$

44,944

Net interest rate spread

3.08

%

2.99

%

2.71

%

Net interest margin

3.20

%

3.12

%

2.92

%

Deposits (including non-interest-bearing checking accounts)

$

10,962,345

$

3,565

0.13

%

$

11,042,809

$

4,803

0.17

%

$

4,421,090

$

6,672

0.60

%


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

At or For the Three Months Ended

September 30,

June 30,

September 30,

Asset Quality Detail

2021

2021

2020

Non-performing loans (NPLs) (1)

One-to-four family residential, including condominium and cooperative apartment

$

4,938

$

4,933

$

867

Multifamily residential and residential mixed-use

859

—

1,213

CRE

4,122

9,152

47

Acquisition, development, and construction ("ADC")

—

—

—

C&I

23,727

14,109

10,287

Other

374

92

10

Total Non-accrual loans

$

34,020

$

28,286

$

12,424

Loans 90 days delinquent and accruing ("90+ Delinquent")

One-to-four family residential, including condominium and cooperative apartment

$

5,021

$

5,065

$

470

Multifamily residential and residential mixed-use

—

157

—

CRE

1,004

—

—

ADC

—

—

1,470

C&I

257

1,487

—

Other

—

—

—

90+ Delinquent

$

6,282

$

6,709

$

1,940

NPAs and 90+ Delinquent

$

40,302

$

34,995

$

14,364

NPAs and 90+ Delinquent / Total assets

0.33

%

0.28

%

0.21

%

Net charge-offs (recoveries) (NCOs)

$

4,191

$

918

$

(69

)

NCOs / Average loans (1)

0.18

%

0.04

%

(0.01

)%

(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 costs, and gain on sale of PPP loans.

Three Months Ended

Nine Months Ended

September 30,

June 30,

September 30,

September 30,

September 30,

2021

2021

2020

2021

2020

Reconciliation of Reported and Adjusted (non-GAAP) Net Income Available to Common Stockholders

Reported net income (loss) available to common stockholders

$

36,573

$

49,456

$

14,046

$

63,174

$

34,264

Adjustments to net income (1):

Provision for credit losses - Non-PCD loans (double-count)

—

—

—

20,278

—

Gain on sale of PPP loans

—

(20,697

)

—

(20,697

)

—

Net gain on sale of securities and other assets

—

—

(215

)

(710

)

(3,357

)

Loss on termination of derivatives

—

—

—

16,505

—

Severance

—

1,875

—

1,875

4,000

Loss on extinguishment of debt

—

157

—

1,751

—

Curtailment loss

—

—

—

1,543

—

Merger expenses and transaction costs (2)

2,472

1,836

769

42,250

2,427

Branch restructuring costs

4,518

1,659

—

6,177

—

Income tax effect of adjustments and other tax adjustments

(2,191

)

4,852

(84

)

(19,187

)

(636

)

Adjusted net income available to common stockholders (non-GAAP)

$

41,372

$

39,138

$

14,516

$

112,959

$

36,698

Adjusted Ratios (Based upon non-GAAP as calculated above)

Adjusted EPS (Diluted)

$

1.01

$

0.94

$

0.68

$

2.90

$

1.68

Adjusted return on average assets

1.37

%

1.28

%

1.01

%

1.31

%

0.83

%

Adjusted return on average equity

14.27

13.76

9.49

13.80

8.08

Adjusted return on average tangible common equity

18.02

17.48

11.25

17.44

9.38

Adjusted non-interest expense to average assets

1.56

1.52

1.48

1.54

1.55

Adjusted efficiency ratio

46.9

47.5

47.3

47.4

51.1

(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 net interest income, non-interest income, and non-interest expense to pre-tax pre-provision net revenue (non-GAAP) and adjusted pre-tax pre-provision net revenue (non-GAAP):

Three Months Ended

September 30, 2021

June 30, 2021

Net interest income

$

94,828

$

93,254

Non-interest income

9,728

29,544

Total revenues

104,556

122,798

Non-interest expense

56,783

54,882

Pre-tax pre-provision net revenue (non-GAAP) (1)

$

47,773

$

67,916

Adjustments:

Gain on sale of PPP loans

—

(20,697

)

Severance

—

1,875

Loss on extinguishment of debt

—

157

Merger expenses and transaction costs

2,472

1,836

Branch restructuring costs

4,518

1,659

Adjusted pre-tax pre-provision net revenue (non-GAAP) (2)

$

54,763

$

52,746


(1)

The reported pre-tax pre-provision net revenue is a non-GAAP measure calculated by adding GAAP net interest income and GAAP non-interest loss less GAAP non-interest expense.

(2)

The adjusted pre-tax pre-provision net revenue is a non-GAAP measure calculated by adding pre-tax pre-provision net revenue less the net gain on sale of PPP loans, severance, loss on extinguishment of debt, merger expenses and transaction costs, and branch restructuring costs.

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

Nine Months Ended

September 30,

June 30,

September 30,

September 30,

September 30,

2021

2021

2020

2021

2020

Operating expense as a % of average assets - as reported

1.80

%

1.72

%

1.53

%

2.16

%

1.68

%

Loss on extinguishment of debt

—

—

—

(0.02

)

—

Curtailment loss

—

—

—

(0.02

)

—

Severance

—

(0.06

)

—

(0.02

)

(0.08

)

Merger expenses and transaction costs

—

(0.06

)

(0.05

)

(0.47

)

(0.05

)

Branch restructuring costs

(0.08

)

(0.05

)

—

(0.07

)

—

Amortization of other intangible assets

(0.14

)

(0.03

)

—

(0.02

)

—

Adjusted operating expense as a % of average assets (non-GAAP)

1.56

1.52

1.48

1.54

1.55

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

Three Months Ended

Nine Months Ended

September 30,

June 30,

September 30,

September 30,

September 30,

2021

2021

2020

2021

2020

Efficiency ratio - as reported (non-GAAP) (1)

54.3

%

44.7

%

48.6

%

65.3

%

54.3

%

Non-interest expense - as reported

$

56,783

$

54,882

$

24,853

$

194,470

$

80,239

Less: Severance

—

(1,875

)

—

(1,875

)

(4,000

)

Less: Merger expenses and transaction costs

(2,472

)

(1,836

)

(769

)

(42,250

)

(2,427

)

Less: Branch restructuring costs

(4,518

)

(1,659

)

—

(6,177

)

—

Less: Loss on extinguishment of debt

—

(157

)

—

(1,751

)

—

Less: Curtailment loss

—

—

—

(1,543

)

—

Less: Amortization of other intangible assets

(715

)

(835

)

—

(1,907

)

—

Adjusted non-interest expense (non-GAAP)

$

49,078

$

48,520

$

24,084

$

138,967

$

73,812

Net interest income - as reported

$

94,828

$

93,254

$

44,944

$

265,923

$

129,024

Non-interest income (loss) - as reported

$

9,728

$

29,544

$

6,149

$

31,889

$

18,771

Less: Gain on sale of PPP loans

—

(20,697

)

—

(20,697

)

—

Less: Net gain on sale of securities and other assets

—

—

(215

)

(710

)

(3,357

)

Less: Loss on termination of derivatives

—

—

—

16,505

—

Adjusted non-interest income (non-GAAP)

$

9,728

$

8,847

$

5,934

$

26,987

$

15,414

Adjusted total revenues for adjusted efficiency ratio (non-GAAP)

$

104,556

$

102,101

$

50,878

$

292,910

$

144,438

Adjusted efficiency ratio (non-GAAP) (2)

46.9

%

47.5

%

47.3

%

47.4

%

51.1

%


(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 assets, tangible common equity, and adjusted tangible common book value per share calculation (non-GAAP):

September 30,

June 30,

September 30,

2021

2021

2020

Reconciliation of Tangible Assets:

Total assets

$

12,364,381

$

12,703,685

$

6,619,391

Less:

Goodwill

155,339

155,339

55,638

Other intangible assets

9,077

9,792

—

Tangible assets (non-GAAP)

$

12,199,965

$

12,538,554

$

6,563,753

Reconciliation of Adjusted Tangible Common Equity - Consolidated:

Total stockholders' equity

$

1,201,117

$

1,204,276

$

694,158

Less:

Goodwill

155,339

155,339

55,638

Other intangible assets

9,077

9,792

—

Tangible equity (non-GAAP)

1,036,701

1,039,145

638,520

Less:

Preferred stock, net

116,569

116,569

116,569

Tangible common equity (non-GAAP)

$

920,132

$

922,576

$

521,951

Add:

Unamortized deferred fees on PPP loans, net of tax

612

1,979

5,435

Adjusted tangible common equity (non-GAAP)

$

920,744

$

924,555

$

527,386

Common shares outstanding

40,715

41,160

21,416

Tangible common book value per share (non-GAAP)

$

22.60

$

22.41

$

24.37

Adjusted tangible common book value per share (non-GAAP)

$

22.61

$

22.46

$

24.63


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