Dime Community Bancshares, Inc. Reports First Quarter 2022 Results

Dime Community Bancshares, Inc.
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Dime Community Bancshares, Inc.

Quarterly Net Income to Common Stockholders Increases by $55.6 Million on a Year-Over-Year Basis

Non-Interest-Bearing Deposits Increase to 38% of Total Deposits
Positioning the Company Well for a Rising Interest Rate Scenario

Net Interest Margin Expands by 5 Basis Points Versus the Prior Quarter

HAUPPAUGE, N.Y., April 29, 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 $32.7 million for the quarter ended March 31, 2022, or $0.82 per diluted common share, compared to net income available to common stockholders of $33.5 million for the quarter ended December 31, 2021, or $0.83 per diluted common share. For the quarter ended March 31, 2021, net loss available to common stockholders was $22.9 million, or $0.66 per diluted common share.

Kevin M. O’Connor, Chief Executive Officer (“CEO”) of the Company, stated, “During the first quarter, we executed well on each of our strategic plan priorities – growing non-interest-bearing deposits, managing our cost of funds appropriately and prioritizing net interest margin expansion, prudent expense discipline, and maintaining solid asset quality. Importantly, we recently announced several key hires in our lending division by capitalizing on merger-related disruption in our marketplace. As the year progresses, we expect loan growth and non-interest income to pick-up. Our high level of non-interest-bearing deposits, coupled with a balance sheet that does not rely on wholesale leverage, positions us well for a rising interest rate scenario.”

Highlights for the First Quarter of 2022 Included:

  • The non-interest-bearing deposits to total deposits ratio increased to 37.9% at March 31, 2022;

  • The cost of deposits declined to 0.10% during the first quarter of 2022;

  • The net interest margin expanded by 5 basis points versus the linked quarter;

  • Total loans held for investment, net, excluding Paycheck Protection Program (“PPP”) loans increased by 2% on an annualized basis versus the linked quarter;

  • Non-interest expenses for the first quarter of 2022 were down 2% versus the linked quarter;

  • The Company repurchased 505,005 shares of its common stock, which represented approximately 1.3% of shares outstanding at the beginning of the period, at a weighted average price of $34.44 per share; and

  • Non-performing assets and loans 90 days past due and accruing declined by 14% versus the linked quarter and represented only 0.31% of total assets as of March 31, 2022.

Management’s Discussion of Quarterly Operating Results

The Company’s results of operations for the first quarter of 2022 and fourth quarter of 2021 include income for the full quarter from the merger with Bridge Bancorp, Inc. (“Bridge”), compared to two months for the first quarter of 2021 following the completion of the merger on February 1, 2021.

Net Interest Income

Net interest income for the first quarter of 2022 was $89.1 million compared to $91.7 million for the fourth quarter of 2021 and $77.8 million for the first quarter of 2021.

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 purchase accounting accretion on the loan portfolio.

(Dollars in thousands)

Q1 2022

Q4 2021

Q1 2021

Net interest income

$

89,109

$

91,686

$

77,841

Less: Net interest income on PPP loans

(396

)

(539

)

(4,092

)

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

$

88,713

$

91,147

$

73,749

Average interest-earning assets

$

11,333,805

$

11,582,086

$

10,057,682

Average PPP loan balances

(46,807

)

(96,065

)

(1,020,910

)

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

$

11,286,998

$

11,486,021

$

9,036,772

NIM (1)

3.19

%

3.14

%

3.14

%

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

3.19

%

3.15

%

3.31

%

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

$

88,713

$

91,147

$

73,749

Less: Purchase accounting accretion on loans ("PAA")

(50

)

625

(1,333

)

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

$

88,663

$

91,772

$

72,416

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

3.19

%

3.17

%

3.26

%


(1)

NIM represents net interest income divided by average interest-earning assets.

(2)

Adjusted NIM excluding PPP loans 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 3.76% at March 31, 2022, a 3 basis point increase compared to the ending WAR on the total loan portfolio at December 31, 2021. Excluding the impact of PPP loans, the WAR on the loan portfolio was 3.77% at March 31, 2022, compared to 3.75% at December 31, 2021.

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

March 31, 2022

December 31, 2021

March 31, 2021

($ in thousands)

Balance

WAR

Balance

WAR

Balance

WAR

Loans held for investment balances at period end:

Commercial and industrial ("C&I")

$

888,056

4.19

%

$

867,542

4.08

%

$

898,533

4.26

%

Owner-occupied commercial real estate

1,016,804

4.04

1,030,240

4.05

948,101

4.19

Business loans

1,904,860

4.11

1,897,782

4.06

1,846,634

4.22

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

669,099

3.53

669,282

3.63

693,548

3.79

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

3,371,267

3.56

3,356,346

3.56

3,589,074

3.60

Non-owner-occupied commercial real estate

2,930,114

3.73

2,915,708

3.69

2,665,029

3.72

Acquisition, development, and construction

329,349

4.63

322,628

4.53

253,837

4.85

Other loans

12,207

6.52

16,898

5.85

23,912

4.95

Loans held for investment excluding PPP

9,216,896

3.77

9,178,644

3.75

9,072,034

3.82

PPP

32,953

1.00

66,017

1.00

1,434,064

1.00

Total loans held for investment including PPP

$

9,249,849

3.76

%

$

9,244,661

3.73

%

$

10,506,098

3.43

%


(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 loans underlying multifamily 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)

Q1 2022

Q4 2021

Q1 2021

Loan originations, excluding PPP

$

480.4

$

463.9

$

334.5

Deposits

Total deposits decreased by $28.9 million on a linked quarter basis to $10.43 billion at March 31, 2022. The decline in total deposits was primarily due to the Bank not renewing higher-cost certificates of deposit accounts and maintaining pricing discipline on consumer money market accounts.

CEO O’Connor stated, “The weighted-average rate on our deposit portfolio declined to 0.09% at March 31, 2022. We continue to have strong success in growing non-interest-bearing deposit balances from our business customers.”

Non-interest-bearing deposits increased $33.2 million during the first quarter of 2022 to $3.95 billion at March 31, 2022, representing 37.9% of total deposits.

Outlined below are certificates of deposit balances set to mature in 2022 for the quarter ended as indicated.

Certificates of deposit set to mature in 2022

($ in thousands)

Balance

WAR

Q2 2022

$

320,775

0.57

%

Q3 2022

183,568

0.26

Q4 2022

74,898

0.42

Non-Interest Income

Non-interest income (loss) was $7.2 million during the first quarter of 2022, $10.2 million during the fourth quarter of 2021, and $(7.4) million during the first quarter of 2021. Excluding net gain on sale of securities and other assets, adjusted non-interest income was $9.2 million during the fourth quarter of 2021. Excluding the loss on termination of derivatives and net gain on sale of securities and other assets, adjusted non-interest income was $8.4 million during the first quarter of 2021 (see “Non-GAAP Reconciliation” table at the end of this news release).

CEO O’Connor stated, “Given our current pipelines, we expect the level of customer-related loan swap revenue and SBA gain on sale revenue to pick-up starting in the second quarter of the year.”

Non-Interest Expense

Total non-interest expense was $49.9 million during the first quarter of 2022, $50.8 million during the fourth quarter of 2021, and $82.8 million during the first quarter of 2021. 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. Excluding the impact of merger expenses and transaction costs, loss on extinguishment of debt, curtailment loss, and amortization of other intangible assets, adjusted non-interest expense was $41.4 million during the first quarter of 2021 (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 first quarter of 2022, compared to 1.64% during the linked quarter and 3.11% for the first quarter of 2021. Excluding the impact of merger expenses and transaction costs, branch restructuring, loss on extinguishment of debt, curtailment loss, and amortization of other intangible assets, the ratio of adjusted non-interest expense to average assets was 1.57% during the linked quarter and 1.55% for the first quarter of 2021 (see “Non-GAAP Reconciliation” table at the end of this news release).

The efficiency ratio was 51.8% during the first quarter of 2022, compared to 49.9% during the linked quarter and 117.5% during the first quarter of 2021. Excluding the impact of merger expenses and transaction costs, branch restructuring, loss on extinguishment of debt, curtailment loss, amortization of other intangible assets, loss on termination of derivatives, and net gain on sale of securities and other assets, the adjusted efficiency ratio was 48.2% during the linked quarter and 48.0% during the first quarter of 2021 (see “Non-GAAP Reconciliation” table at the end of this news release).

Income Tax Expense

The reported effective tax rate for the first quarter of 2022 was 28.1%, compared to 30.9% for the fourth quarter of 2021, and 25.2% for the first quarter of 2021.

Credit Quality

Non-performing loans at March 31, 2022 were $36.0 million, or 0.39% of total loans.

A credit loss recovery of $1.6 million was recorded during the first quarter of 2022, compared to a credit loss recovery of $132 thousand during the fourth quarter of 2021, and a credit loss provision of $15.8 million during the first quarter of 2021. The credit loss recovery was associated with the improvement in forecasted macroeconomic conditions as well as a reduction in reserves on individually evaluated loans.

The allowance for credit losses as a percentage of total loans was 0.86% at March 31, 2022 as compared to 0.91% at December 31, 2021 and 0.93% at March 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 first quarter, we continued to execute on our share repurchase program and we repurchased $17.4 million of common stock. Our Tier 1 Risk-Based Capital Ratio increased by 7 basis points in the quarter to 10.76%. Our strong balance sheet and internal stress testing analyses continue to provide support for future capital return to shareholders.”

Dividends per common share were $0.24 during the first quarter of 2022.

Book value per common share was $26.32 at March 31, 2022 compared to $26.98 at December 31, 2021. Tangible common book value per share (which represents common equity less goodwill and other intangible assets, divided by number of shares outstanding) was $22.18 at March 31, 2022 compared to $22.87 at December 31, 2021 (see “Non-GAAP Reconciliation” tables at the end of this news release). The linked quarter declines in book value per share and tangible common book value per share were primarily due to the increase in the accumulated other comprehensive loss component of stockholders’ equity. The accumulated other comprehensive loss component of stockholders’ equity increased on a linked quarter basis due to the increase in market interest rates over the course of the first quarter of 2022.

Earnings Call Information

The Company will conduct a conference call at 8:30 a.m. (ET) on April 29, 2022, during which CEO O’Connor will discuss the Company’s first quarter 2022 financial performance, with a question and answer session to follow. Dial-in information for the live call is 1-844-200-6205. Upon dialing in, request to be joined into the 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://events.q4inc.com/attendee/980319168. Dial-in information for the replay is 1-866-813-9403 using access code 178273. Replay will be available beginning on April 29, 2022 at 10:30 a.m. through May 13, 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 most recent Annual Report on Form 10-K and updates set forth in the Company’s subsequent 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)

March 31,

December 31,

March 31,

2022

2021

2021

Assets:

Cash and due from banks

$

432,994

$

393,722

$

676,723

Securities available-for-sale, at fair value

1,277,036

1,563,711

1,152,493

Securities held-to-maturity

383,922

179,309

—

Loans held for sale

17,053

5,493

23,704

Loans held for investment, net:

C&I

888,056

867,542

898,533

Owner-occupied commercial real estate

1,016,804

1,030,240

948,101

Total business loans

1,904,860

1,897,782

1,846,634

One-to-four family and cooperative/condominium apartment

669,099

669,282

693,548

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

3,371,267

3,356,346

3,589,074

Non-owner-occupied commercial real estate

2,930,114

2,915,708

2,665,029

Acquisition, development, and construction

329,349

322,628

253,837

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

32,953

66,017

1,434,064

Other loans

12,207

16,898

23,912

Allowance for credit losses

(79,615

)

(83,853

)

(98,200

)

Total loans held for investment, net

9,170,234

9,160,808

10,407,898

Premises and fixed assets, net

49,940

50,368

53,829

Premises held for sale

556

556

—

Restricted stock

38,898

37,732

45,063

Bank Owned Life Insurance ("BOLI")

297,628

295,789

251,521

Goodwill

155,797

155,797

155,339

Other intangible assets

7,776

8,362

10,627

Operating lease assets

61,467

64,258

69,094

Derivative assets

71,826

45,086

45,760

Accrued interest receivable

38,456

40,149

51,100

Other assets

74,662

65,224

75,477

Total assets

$

12,078,245

$

12,066,364

$

13,018,628

Liabilities:

Non-interest-bearing checking

$

3,953,627

$

3,920,423

$

3,538,936

Interest-bearing checking

902,360

905,717

1,023,164

Savings

1,376,092

1,158,040

1,078,687

Money market

3,416,249

3,621,552

3,629,709

Certificates of deposit

781,775

853,242

1,540,316

Total deposits

10,430,103

10,458,974

10,810,812

FHLBNY advances

50,000

25,000

533,865

Other short-term borrowings

2,853

1,862

126,763

Subordinated debt, net

197,050

197,096

197,234

Derivative cash collateral

64,450

—

—

Operating lease liabilities

63,600

66,103

71,249

Derivative liabilities

60,586

40,728

41,816

Other liabilities

54,316

83,981

64,065

Total liabilities

10,922,958

10,873,744

11,845,804

Stockholders' equity:

Preferred stock, Series A

116,569

116,569

116,569

Common stock

416

416

416

Additional paid-in capital

494,969

494,125

492,431

Retained earnings

677,990

654,726

574,297

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

(49,380

)

(6,181

)

531

Unearned equity awards

(10,562

)

(7,842

)

(10,107

)

Treasury stock, at cost

(74,715

)

(59,193

)

(1,313

)

Total stockholders' equity

1,155,287

1,192,620

1,172,824

Total liabilities and stockholders' equity

$

12,078,245

$

12,066,364

$

13,018,628


(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

March 31,

December 31,

March 31,

2022

2021

2021

Interest income:

Loans

$

86,420

$

89,301

$

81,382

Securities

7,131

7,097

4,380

Other short-term investments

368

414

993

Total interest income

93,919

96,812

86,755

Interest expense:

Deposits and escrow

2,531

2,861

5,298

Borrowed funds

2,278

2,265

3,616

Derivative cash collateral

1

—

—

Total interest expense

4,810

5,126

8,914

Net interest income

89,109

91,686

77,841

(Credit) provision for credit losses

(1,592

)

(132

)

15,779

Net interest income after (credit) provision

90,701

91,818

62,062

Non-interest income:

Service charges and other fees

4,058

4,621

2,920

Title fees

421

735

433

Loan level derivative income

6

113

1,792

BOLI income

1,839

1,890

1,339

Gain on sale of SBA loans

242

851

164

Gain on sale of residential loans

148

225

723

Net gain on equity securities

—

—

131

Net gain on sale of securities and other assets

—

975

710

Loss on termination of derivatives

—

—

(16,505

)

Other

489

769

910

Total non-interest income (loss)

7,203

10,179

(7,383

)

Non-interest expense:

Salaries and employee benefits

30,834

27,638

24,819

Occupancy and equipment

7,584

7,784

6,977

Data processing costs

3,805

4,506

3,528

Marketing

1,295

1,959

860

Professional services

2,094

2,130

1,865

Federal deposit insurance premiums

1,150

1,031

939

Loss on extinguishment of debt

—

—

1,594

Curtailment loss

—

—

1,543

Merger expenses and transaction costs

—

2,574

37,942

Branch restructuring

—

(1,118

)

—

Amortization of other intangible assets

586

715

357

Other

2,540

3,610

2,381

Total non-interest expense

49,888

50,829

82,805

Income (loss) before taxes

48,016

51,168

(28,126

)

Income tax expense (benefit)

13,485

15,811

(7,092

)

Net income (loss)

34,531

35,357

(21,034

)

Preferred stock dividends

1,821

1,821

1,821

Net income (loss) available to common stockholders

$

32,710

$

33,536

$

(22,855

)

Earnings per common share ("EPS"):

Basic

$

0.82

$

0.83

$

(0.66

)

Diluted

$

0.82

$

0.83

$

(0.66

)

Average common shares outstanding for diluted EPS

39,251,246

39,876,825

34,262,005


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

At or For the Three Months Ended

March 31,

December 31,

March 31,

2022

2021

2021

Per Share Data:

Reported EPS (Diluted)

$

0.82

$

0.83

$

(0.66

)

Cash dividends paid per common share

0.24

0.24

0.24

Book value per common share

26.32

26.98

25.43

Tangible common book value per share (1)

22.18

22.87

21.43

Common shares outstanding

39,460

39,878

41,536

Dividend payout ratio

29.27

%

28.92

%

(36.36

)

%

Performance Ratios (Based upon Reported Net Income):

Return on average assets

1.13

%

1.14

%

(0.79

)

%

Return on average equity

11.53

11.67

(8.18

)

Return on average tangible common equity (1)

14.44

14.61

(11.58

)

Net interest margin

3.19

3.14

3.14

Non-interest expense to average assets

1.64

1.64

3.11

Efficiency ratio

51.8

49.9

117.5

Effective tax rate

28.08

30.90

25.22

Balance Sheet Data:

Average assets

$

12,199,721

$

12,419,184

$

10,666,240

Average interest-earning assets

11,333,805

11,582,086

10,057,682

Average tangible common equity (1)

916,971

931,503

781,355

Loan-to-deposit ratio at end of period

88.7

88.4

97.2

Capital Ratios and Reserves - Consolidated: (3)

Tangible common equity to tangible assets (1)

7.35

%

7.66

%

6.93

%

Tangible equity to tangible assets (1)

8.32

8.64

7.83

Tier 1 common equity ratio

9.56

9.49

9.65

Tier 1 risk-based capital ratio

10.76

10.69

10.91

Total risk-based capital ratio

13.48

13.45

14.04

Tier 1 leverage ratio

8.65

8.46

9.62

CRE consolidated concentration ratio (2)

519

519

517

Allowance for credit losses/ Total loans

0.86

0.91

0.93

Allowance for credit losses/ Non-performing loans

221.39

208.04

276.24


(1)

See "Non-GAAP Reconciliation" table for reconciliation of tangible equity, tangible common equity, and tangible assets.

(2)

The CRE concentration ratio is calculated using the sum of commercial real estate, excluding owner-occupied commercial real estate, multifamily, and acquisition, development, and construction, divided by consolidated capital. March 31, 2022 amounts are preliminary pending completion and filing of the Company’s regulatory reports.

(3)

March 31, 2022 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

March 31, 2022

December 31, 2021

March 31, 2021

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

$

8,296,732

$

76,437

3.74

%

$

8,293,470

$

78,367

3.75

%

$

7,068,571

$

66,412

3.81

%

Commercial and industrial loans

869,283

9,369

4.37

873,273

10,119

4.60

703,067

9,567

5.52

SBA PPP loans

46,807

417

3.61

96,065

583

2.41

1,020,910

5,049

2.01

Other loans

15,658

197

5.10

18,385

232

5.01

16,602

354

8.65

Securities

1,726,189

7,131

1.68

1,729,191

7,097

1.63

865,192

4,380

2.05

Other short-term investments

379,136

368

0.39

571,702

414

0.29

383,340

993

1.05

Total interest-earning assets

11,333,805

93,919

3.36

%

11,582,086

96,812

3.32

%

10,057,682

86,755

3.50

%

Non-interest-earning assets

865,916

837,098

608,558

Total assets

$

12,199,721

$

12,419,184

$

10,666,240

Liabilities and Stockholders' Equity:

Interest-bearing liabilities:

Interest-bearing checking

$

870,889

$

367

0.17

%

$

962,597

$

455

0.19

%

$

662,273

$

311

0.19

%

Money market

3,632,438

973

0.11

3,652,681

1,087

0.12

2,893,723

2,026

0.28

Savings

1,256,701

207

0.07

1,174,719

108

0.04

863,409

207

0.10

Certificates of deposit

824,883

984

0.48

915,210

1,211

0.52

1,522,017

2,754

0.73

Total interest-bearing deposits

6,584,911

2,531

0.16

6,705,207

2,861

0.17

5,941,422

5,298

0.36

FHLBNY advances

33,889

77

0.92

25,000

61

0.97

853,162

1,711

0.81

Subordinated debt, net

197,080

2,201

4.53

197,126

2,204

4.44

168,607

1,902

4.57

Other short-term borrowings

2,459

—

—

2,484

—

—

15,021

3

0.08

Total borrowings

233,428

2,278

3.96

224,610

2,265

4.00

1,036,790

3,616

1.41

Derivative cash collateral

14,335

1

0.03

—

—

—

—

—

—

Total interest-bearing liabilities

6,832,674

4,810

0.29

%

6,929,817

5,126

0.29

%

6,978,212

8,914

0.52

%

Non-interest-bearing checking

3,979,741

4,096,046

2,494,630

Other non-interest-bearing liabilities

189,843

181,074

164,859

Total liabilities

11,002,258

11,206,937

9,637,701

Stockholders' equity

1,197,463

1,212,247

1,028,539

Total liabilities and stockholders' equity

$

12,199,721

$

12,419,184

$

10,666,240

Net interest income

$

89,109

$

91,686

$

77,841

Net interest rate spread

3.07

%

3.03

%

2.98

%

Net interest margin

3.19

%

3.14

%

3.14

%

Deposits (including non-interest-bearing checking accounts)

$

10,564,652

$

2,531

0.10

%

$

10,801,253

$

2,861

0.11

%

$

8,436,052

$

5,298

0.25

%


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

At or For the Three Months Ended

March 31,

December 31,

March 31,

Asset Quality Detail

2022

2021

2021

Non-performing loans ("NPLs") (1)

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

$

5,241

$

7,623

$

5,384

Multifamily residential and residential mixed-use

—

—

4,844

Commercial real estate

4,972

5,053

10,595

Acquisition, development, and construction

665

—

104

C&I

25,000

27,266

14,523

Other

84

365

99

Total Non-accrual loans

$

35,962

$

40,307

$

35,549

Total Non-performing assets ("NPAs")

$

35,962

$

40,307

$

35,549

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

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

$

341

$

1,945

$

45

Multifamily residential and residential mixed-use

—

—

2,871

Commercial real estate

—

—

2,259

Acquisition, development, and construction

—

—

—

C&I

839

1,056

3,652

Other

—

—

—

90+ Delinquent

$

1,180

$

3,001

$

8,827

NPAs and 90+ Delinquent

$

37,142

$

43,308

$

44,376

NPAs and 90+ Delinquent / Total assets

0.31

%

0.36

%

0.34

%

Net charge-offs (recoveries) ("NCOs")

$

2,583

$

(108

)

$

4,275

NCOs / Average loans (1)

0.11

%

0.00

%

0.19

%

(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:

Three Months Ended

March 31,

December 31,

March 31,

2022

2021

2021

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

Reported net income (loss) available to common stockholders

$

32,710

$

33,536

$

(22,855

)

Adjustments to net income (loss) (1):

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

—

—

20,278

Net gain on sale of securities and other assets

—

(975

)

(710

)

Loss on termination of derivatives

—

—

16,505

Loss on extinguishment of debt

—

—

1,594

Curtailment loss

—

—

1,543

Merger expenses and transaction costs (2)

—

2,574

37,942

Branch restructuring

—

(1,118

)

—

Income tax effect of adjustments and other tax adjustments

—

(234

)

(21,848

)

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

$

32,710

$

33,783

$

32,449

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

Adjusted EPS (Diluted)

$

0.82

$

0.84

$

0.94

Adjusted return on average assets

1.13

%

1.15

%

1.29

%

Adjusted return on average equity

11.53

11.75

13.32

Adjusted return on average tangible common equity

14.44

14.72

16.74

Adjusted non-interest expense to average assets

1.62

1.57

1.55

Adjusted efficiency ratio

51.2

48.2

48.0

(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

March 31,

December 31,

March 31,

2022

2021

2021

Operating expense as a % of average assets - as reported

1.64

%

1.64

%

3.11

%

Loss on extinguishment of debt

—

—

(0.06

)

Curtailment loss

—

—

(0.06

)

Merger expenses and transaction costs

—

(0.08

)

(1.43

)

Branch restructuring

—

0.03

—

Amortization of other intangible assets

(0.02

)

(0.02

)

(0.01

)

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

1.62

1.57

1.55

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

Three Months Ended

March 31,

December 31,

March 31,

2022

2021

2021

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

51.8

%

49.9

%

117.5

%

Non-interest expense - as reported

$

49,888

$

50,829

$

82,805

Less: Merger expenses and transaction costs

—

(2,574

)

(37,942

)

Less: Branch restructuring

—

1,118

—

Less: Loss on extinguishment of debt

—

—

(1,594

)

Less: Curtailment loss

—

—

(1,543

)

Less: Amortization of other intangible assets

(586

)

(715

)

(357

)

Adjusted non-interest expense (non-GAAP)

$

49,302

$

48,658

$

41,369

Net interest income - as reported

$

89,109

$

91,686

$

77,841

Non-interest income (loss) - as reported

$

7,203

$

10,179

$

(7,383

)

Less: Net gain on sale of securities and other assets

—

(975

)

(710

)

Less: Loss on termination of derivatives

—

—

16,505

Adjusted non-interest income (non-GAAP)

$

7,203

$

9,204

$

8,412

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

$

96,312

$

100,890

$

86,253

Adjusted efficiency ratio (non-GAAP) (2)

51.2

%

48.2

%

48.0

%

_________________________

(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 income (loss).

(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):

March 31,

December 31,

March 31,

2022

2021

2021

Reconciliation of Tangible Assets:

Total assets

$

12,078,245

$

12,066,364

$

13,018,628

Less:

Goodwill

(155,797

)

(155,797

)

(155,339

)

Other intangible assets

(7,776

)

(8,362

)

(10,627

)

Tangible assets (non-GAAP)

$

11,914,672

$

11,902,205

$

12,852,662

Reconciliation of Tangible Common Equity - Consolidated:

Total stockholders' equity

$

1,155,287

$

1,192,620

$

1,172,824

Less:

Goodwill

(155,797

)

(155,797

)

(155,339

)

Other intangible assets

(7,776

)

(8,362

)

(10,627

)

Tangible equity (non-GAAP)

991,714

1,028,461

1,006,858

Less:

Preferred stock, net

(116,569

)

(116,569

)

(116,569

)

Tangible common equity (non-GAAP)

$

875,145

$

911,892

$

890,289

Common shares outstanding

39,460

39,878

41,536

Tangible common equity to tangible assets (non-GAAP)

7.35

%

7.66

%

6.93

Tangible equity to tangible assets (non-GAAP)

8.32

8.64

7.83

Book value per share

$

26.32

$

26.98

$

25.43

Tangible common book value per share (non-GAAP)

22.18

22.87

21.43


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