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PCSB Financial Corporation Announces Fourth Fiscal Quarter and Year End Financial Results and Declares Quarterly Cash Dividend

PCSB Financial Corporation
PCSB Financial Corporation

YORKTOWN HEIGHTS, N.Y., Aug. 04, 2022 (GLOBE NEWSWIRE) -- PCSB Financial Corporation (the “Company”) (NASDAQ: PCSB), parent of PCSB Bank (the "Bank"), today announced net income of $3.5 million, or $0.25 per diluted share, for the three months ended June 30, 2022, compared to $3.5 million, or $0.24 per diluted share, for the three months ended March 31, 2022 and $3.4 million, or $0.23 per diluted share, for the three months ended June 30, 2021.

Net income was $14.9 million, or $1.04 per diluted share, for the year ended June 30, 2022, compared to $12.4 million, or $0.84 per diluted share, for the year ended June 30, 2021. Results for the three months and year ended June 30, 2022 include merger-related expenses of $1.2 million and $1.3 million, or $0.07 and $0.08 per diluted share, net of tax, respectively. Results for the year ended June 30, 2021 include a benefit for loan losses of $673,000, or $0.04 per diluted share, net of tax, which includes the release of the qualitative reserves established in the prior fiscal year associated with the COVID-19 pandemic.

On May 23, 2022, the Company and Brookline Bancorp, Inc. (“Brookline”), the holding company of Brookline Bank and Bank Rhode Island, entered into an Agreement and Plan of Merger (the “Merger Agreement”).  Pursuant to the  Merger Agreement, PCSB will merge with and into Brookline, with  Brookline as the surviving corporation (the “Merger”). Following the  Merger, PCSB Bank will operate as a separate bank subsidiary of  Brookline. The consummation of the Merger is subject to customary closing conditions, including the receipt of regulatory approvals and approval by PCSB’s stockholders. The Merger is currently expected to be completed in the  fourth quarter of 2022.

On July 27, 2022, the Board of Directors declared a regular quarterly cash dividend of $0.07 per share. The dividend is payable on or about September 9, 2022 to shareholders of record as of the close of business on August 26, 2022.

Fourth Quarter Highlights

  • Net income of $3.5 million, or $0.25 per diluted share, for the current quarter, increases of 0.8% and 2.7% compared to the linked quarter and same quarter last year, respectively. Excluding merger-related expenses and certain other non-recurring items, current quarter adjusted net income (non-GAAP) was $4.4 million or $0.31 per diluted share, increases of 34.1% and 79.3% compared to the linked quarter and same quarter last year, respectively. Reconciliation of GAAP to Non-GAAP financial measures appear at the end of this release.

  • Net interest income of $13.9 million for the current quarter, increases of 9.5% and 10.7% from the linked quarter and the same quarter last year, respectively.

  • Tax equivalent net interest margin of 3.00% for the current quarter, an increase from 2.80% in the linked quarter and 2.81% for the same quarter last year.

  • Average cost of interest-bearing deposits of 0.35% for the current quarter, a decrease from 0.37% in the linked quarter and 0.48% for the same quarter last year.

  • Efficiency ratio of 68.38% for the current quarter, compared to 65.66% for the linked quarter and 67.43% for the same quarter last year. Adjusted efficiency ratio (non-GAAP) of 61.28% for the current quarter, a decrease from 66.60% for the linked quarter and 74.10% for the same quarter last year.

  • Average loans receivable (excluding PPP loans) of $1.31 billion for the current quarter, increases of 5.2% and 9.4% compared to the linked quarter and same quarter last year, respectively.

  • Average deposits of $1.61 billion for the current quarter, increases of 3.1% and 8.4% compared to the linked quarter and same quarter last year, respectively.

  • Allowance for loan losses to total net loans receivable (excluding PPP loans) of 0.67% as of June 30, 2022, largely unchanged compared to 0.66% as of June 30, 2021.

  • Non-performing loans of $9.2 million, or 0.69% of total net loans receivable (excluding PPP loans), as of June 30, 2022, increased from 0.48% as of June 30, 2021.

  • The Company had no loans on COVID-19-related payment deferral as of June 30, 2022, compared to $27.3 million (19 loans), or 2.21% of gross loans, as of June 30, 2021.

President’s Comments

Joseph D. Roberto, Chairman, President & Chief Executive Officer of PCSB Financial Corporation, commented, “We are pleased with the Company’s solid operating and financial results for our fiscal fourth quarter and year ended June 30, 2022. Annualized loan growth of 13.6% for the fourth quarter and 8.1% year over year reflects our ability to originate quality loans within our strong market footprint. The loan growth, combined with a balance sheet well-positioned to take advantage of higher interest rates, has led to higher net interest income, margins and earnings. Core net income of $4.4 million for the fourth quarter reflects a 34.1% increase over the linked quarter while core net income of $14.2 million for the year reflects a 33.1% increase over the prior year. Although economic headwinds continue to be challenging, our outlook remains positive as the PCSB team continues working to create sustainable value for our shareholders.”

Mr. Roberto added “We are excited about our pending merger with Brookline and look forward to becoming part of a larger organization, which will benefit all of our shareholders. I want to thank our staff for their dedication and hard work, especially during this time of transition. In addition to operating PCSB Bank in a business-as-usual manner for our customers, they have also been working hard to ensure that we have a seamless transition into Brookline’s organization.”

Income Statement Summary

Net income for the current quarter was $3.5 million, which increased $29,000 from the linked quarter and $93,000 from the prior year quarter. The change from the linked quarter is primarily due to a $1.2 million increase in net interest income, a $165,000 increase in noninterest income and a $77,000 decrease in provision for loan losses, partially offset by increases of $1.3 million in noninterest expense and $113,000 in income tax expense. The change from the prior year quarter is primarily due to increases of $1.3 million in net interest income and $520,000 in noninterest income, partially offset by increases of $1.4 million in noninterest expense, $204,000 in provision for loan losses and $170,000 in income tax expense.

Net interest income was $13.9 million for the current quarter, increases of $1.2 million, or 9.5%, compared to the linked quarter and $1.3 million, or 10.7%, compared to the prior year quarter. The increase compared to the linked quarter is primarily the result of a 20 basis point increase in the tax equivalent net interest margin and a $41.5 million, or 2.3%, increase in average interest-earning assets. The increase in net interest income compared to the prior year period is primarily the result of a 19 basis point increase in the tax equivalent net interest margin and a $75.7 million, or 4.2%, increase in average interest-earning assets.

The Company recognized PPP loan interest and origination fee income (net of costs) of $36,000 in the current quarter, compared to $266,000 in the linked quarter and $516,000 in the prior year quarter. As of June 30, 2022, the Company had 5 outstanding PPP loans with balances totaling $1.9 million. Unearned origination fees (net of costs) were $85,000 as of June 30, 2022, which will be recognized in income over the remaining lives of the loans. PPP loan forgiveness is substantially complete as of June 30, 2022.

The tax equivalent net interest margin was 3.00% for the current quarter, reflecting increases of 20 basis points compared to 2.80% in the linked quarter and 19 basis points compared to 2.81% in the prior year quarter. Adjusted net interest margin, which excludes the effects of loan prepayment income and PPP loan interest and fees, was 2.94% for the current quarter compared to 2.70% in the linked quarter and 2.53% in the prior year quarter. Margin improvement compared to the linked quarter and prior year quarter was the result of a reduction in the cost of funds, driven by a lower costing deposit mix, as well as an increased asset yields, driven by higher market interest rates. Reconciliations of GAAP to non-GAAP financial measures are included at the end of this release.

Tax equivalent yield on interest-earning assets for the current quarter was 3.31%, increases of 19 basis points from the linked quarter and 5 basis point from the prior year quarter. Excluding the effects of non-recurring PPP loan income and loan prepayment income, the tax equivalent yield on interest-earning assets for the current quarter was 3.25%, increases of 22 basis points from the linked quarter and 27 basis points from the same quarter last year. The increase in yield compared to the prior year quarter is a result of higher market interest rates driving higher yield on cash liquidity and adjustable rate loan and investment assets, along with higher investment and loan re-investment rates. Compared to the linked quarter, the increase in yield was the result of higher market interest rates and a more profitable asset mix.

The cost of interest-bearing deposits was 0.35% for the current quarter, decreases of 2 basis points and 13 basis points from 0.37% and 0.48% in the linked quarter and prior year quarter, respectively. In response to lower market interest rates and increased liquidity levels, deposit rate reductions have been implemented throughout the last 2 years, the effects of which continue to be realized. Recent increases by the Federal Reserve in the federal funds rate beginning in March 2022 and continuing throughout the current quarter have not yet resulted in deposit cost increases, due to limited competitive pricing pressures and elevated liquidity in the banking sector. As of quarter end, the weighted average cost of interest-bearing deposits was 0.34%. The cost of interest-bearing liabilities was 0.41% for the current quarter, decreases of 2 basis points from 0.43% in the linked quarter and 18 basis points from 0.59% in the prior year quarter. Over the next 12 months, the Company has $40.0 million of wholesale funding maturing, comprised of FHLB advances and brokered time deposits, with a weighted average cost of 1.79%.

The provision for loan losses was $209,000 for current quarter, compared to $286,000 for the linked quarter and $5,000 for the prior year quarter. Recoveries, net of charge-offs, were $7,000 for the current quarter compared to charge-offs, net of recoveries, of $4,000 for the linked quarter and recoveries, net of charge-offs, of $11,000 for the prior year quarter. Non-performing loans as a percent of total loans receivable (excluding PPP loans) was 0.56% as of June 30, 2022, an increase from 0.48% as of June 30, 2021 but a decrease from 0.61% as of March 31, 2022. Substandard loans were $12.6 million as of June 30, 2022, a decrease from $23.1 million as of March 31, 2022 and $21.6 million as of June 30, 2021, driven primarily by sustained positive borrower operational and payment performance following the end of COVID-19 related payment deferrals. The Company had no loans remaining on COVID-19 related payment deferral as of June 30, 2022, compared to $27.3 million, or 2.21% of gross loans, as of June 30, 2021.

Noninterest income of $1.1 million for the current quarter increased $165,000 compared to the linked quarter and $520,000 compared to the prior year quarter. The increase compared to the linked quarter was primarily due to increases of $119,000 in swap income and $52,000 in fees and services charges. The increase compared to the prior year quarter was primarily due to increases of $452,000 in swap income, $52,000 in fees and service charges and $18,000 in bank-owned life insurance income.

Noninterest expense of $10.3 million for the current quarter increased $1.3 million compared to the linked quarter and $1.4 million compared to the prior year quarter. Excluding merger-related expenses of $1.2 million in the current quarter and $86,000 in the linked quarter, noninterest expenses increased $232,000, or 2.6%, compared to the linked quarter and $235,000, or 2.7%, compared to the same quarter last year. Excluding merger-related expenses, the $235,000 increase compared to the prior year quarter was primarily due to higher salaries and benefits,  marketing and communication and data processing costs which were partially offset by lower pension costs. The $232,000 increase compared to the linked quarter is the result of higher salaries and benefits, partially offset by lower professional fees and pension costs.

The effective income tax rate was 22.8% for the current quarter, as compared to 21.0% for the linked quarter and 20.3% for the prior year quarter. The increase for the current quarter is primarily due to non-deductible merger-related expenses. Excluding such expenses, the effective tax rate for the quarter is 20.2%.

Balance Sheet Summary

Total assets increased $114.2 million to $1.99 billion at June 30, 2022 as compared to June 30, 2021, primarily due to increases of $99.9 million in net loans receivable and $52.1 million in investment securities, partially offset by a $40.8 million decrease in cash and cash equivalents. Net loans receivable increased $99.9 million, or 8.1%, and $135.0 million or 11.3% excluding PPP loans. The increase was primarily the result of increases in commercial mortgage loans and construction loans of $115.5 million and $10.7 million, respectively, partially offset by decreases in commercial loans and residential mortgage loans of $14.4 million and $10.1 million, respectively. The decrease in commercial loans includes a decrease in PPP loans of $35.1 million, driven by forgiveness and paydowns, largely offset by a net increase of $20.7 million in all other commercial loans. The increase in investment securities was the result of the Company deploying excess liquidity and included increases of $27.2 million in state and municipal securities, $14.1 million in U.S. government and agency bonds, $5.7 million in mortgage-backed securities, and $5.1 million in corporate securities.

Total liabilities increased $111.6 million to $1.71 billion at June 30, 2022 as compared to June 30, 2021 as an increase of $134.6 million in deposits was partially offset by decreases of $17.6 million in FHLB advances and $5.4 million in all other liabilities. The $134.6 million, or 9.0% increase in deposits includes increases in NOW, money market, demand and savings  accounts of 37.1%, 19.9%, 12.0% and 6.1%, respectively, partially offset by a 12.6% decrease in time deposits. Current quarter deposit growth of $1.5 million includes the run-off of approximately $38.1 million of transient deposits as of March 31, 2022 expected to outflow in the current quarter.

Total shareholders’ equity increased $2.6 million to $277.2 million at June 30, 2022 as compared to $274.6 million as of June 30, 2021. The increase for the year was primarily due to net income of $14.9 million and $5.0 million of stock-based compensation and reduction in unearned ESOP shares for plan shares earned during the period, partially offset by the repurchase of $8.2 million (443,788 shares) of common stock, $5.5 million of other comprehensive losses related primarily to unrealized losses on investment securities driven by higher market interest rates and $3.6 million of cash dividends declared and paid.

At June 30, 2022, the Company’s book value per share and tangible book value per share were $18.07 and $17.67, respectively, compared to $17.41 and $17.01, respectively, at June 30, 2021. Reconciliations of book value per share (GAAP measure) to tangible book value per share (non-GAAP measure) appear at the end of this release. At June 30, 2022, the Bank was considered “well capitalized” under applicable regulatory guidelines.

 About PCSB Financial Corporation and PCSB Bank

PCSB Financial Corporation is the bank holding company for PCSB Bank. PCSB Bank is a New York-chartered commercial bank that has served the banking needs of its customers in the Lower Hudson Valley of New York State since 1871. It operates from its executive offices/headquarters and 14 branch offices located in Dutchess, Putnam, Rockland and Westchester Counties in New York.

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. These statements may be identified by use of words such as "anticipate," "believe," "could," "estimate," "expect," "intend," "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. These factors include, without limitation, the following: the duration, extent and severity of the COVID-19 pandemic, including its impact on our business and operations, the impact of lost fee revenue and increased operating expenses, as well as its effect on our customers and issuers of securities, including their ability to make timely payments on obligations, service providers and on economies and markets more generally, 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  asset value and interest margins; changes in deposit flows, loan demand or real estate values may adversely affect the Company's business; 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; success or consummation of new business initiatives may be more difficult or expensive than the Company anticipates; or 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. The Company assumes no obligation to update any forward-looking statements except as may be required by applicable law or regulation.

Contact: Joseph D. Roberto
Chairman, President and Chief Executive Officer
(914) 248-7272


PCSB Financial Corporation and Subsidiaries
Consolidated Balance Sheets (unaudited)
(amounts in thousands, except share and per share data)

 

June 30,

 

 

June 30,

 

 

2022

 

 

2021

 

ASSETS

 

 

 

 

 

Cash and due from banks

$

116,522

 

 

$

152,070

 

Federal funds sold

 

1,935

 

 

 

7,235

 

Total cash and cash equivalents

 

118,457

 

 

 

159,305

 

Held to maturity debt securities, at amortized cost (fair value of $361,608 and
 $342,137 as of June 30, 2022 and June 30, 2021, respectively)

 

412,449

 

 

 

337,584

 

Available for sale debt securities, at fair value

 

34,621

 

 

 

57,387

 

Total investment securities

 

447,070

 

 

 

394,971

 

Loans receivable, net of allowance for loan losses of $8,927 and
   $7,881 as of June 30, 2022 and June 30, 2021, respectively

 

1,329,372

 

 

 

1,229,451

 

Accrued interest receivable

 

6,396

 

 

 

6,398

 

FHLB stock

 

3,766

 

 

 

4,507

 

Premises and equipment, net

 

19,358

 

 

 

21,099

 

Deferred tax asset, net

 

4,132

 

 

 

2,552

 

Bank-owned life insurance

 

36,322

 

 

 

35,568

 

Goodwill

 

6,106

 

 

 

6,106

 

Other intangible assets

 

89

 

 

 

151

 

Other assets

 

18,064

 

 

 

14,827

 

Total assets

$

1,989,132

 

 

$

1,874,935

 

LIABILITIES AND SHAREHOLDERS' EQUITY

 

 

 

 

 

Interest bearing deposits

$

1,380,953

 

 

$

1,272,610

 

Non-interest bearing deposits

 

245,297

 

 

 

219,072

 

Total deposits

 

1,626,250

 

 

 

1,491,682

 

Mortgage escrow funds

 

11,173

 

 

 

10,536

 

Advances from FHLB

 

48,323

 

 

 

65,957

 

Other liabilities

 

26,224

 

 

 

32,200

 

Total liabilities

 

1,711,970

 

 

 

1,600,375

 

Commitments and contingencies

 

-

 

 

 

-

 

Shareholders' equity:

 

 

 

 

 

Preferred stock ($0.01 par value, 10,000,000 shares authorized, no shares issued or outstanding as of June 30, 2022 and June 30, 2021)

 

-

 

 

 

-

 

Common stock ($0.01 par value, 200,000,000 shares authorized, 18,703,577 shares issued as of both June 30, 2022 and June 30, 2021, and 15,334,857 and 15,770,645 shares outstanding as of June 30, 2022 and June 30, 2021, respectively)

 

187

 

 

 

187

 

Additional paid in capital

 

193,893

 

 

 

189,926

 

Retained earnings

 

162,262

 

 

 

150,987

 

Unearned compensation - ESOP

 

(9,208

)

 

 

(10,176

)

Accumulated other comprehensive loss, net of income taxes

 

(8,629

)

 

 

(3,099

)

Treasury stock, at cost (3,368,720 and 2,932,932 shares as of June 30, 2022 and June 30, 2021, respectively)

 

(61,343

)

 

 

(53,265

)

Total shareholders' equity

 

277,162

 

 

 

274,560

 

Total liabilities and shareholders' equity

$

1,989,132

 

 

$

1,874,935

 


PCSB Financial Corporation and Subsidiaries
Consolidated Statements of Operations (unaudited)
(amounts in thousands, except share and per share data)

 

Three Months Ended

 

 

Year Ended

 

 

June 30,

 

 

June 30,

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Interest and dividend income

 

 

 

 

 

 

 

 

 

 

 

Loans receivable

$

12,801

 

 

$

12,625

 

 

$

49,502

 

 

$

49,470

 

Investment securities

 

2,315

 

 

 

1,851

 

 

 

8,609

 

 

 

7,340

 

Federal funds and other

 

267

 

 

 

110

 

 

 

569

 

 

 

454

 

Total interest and dividend income

 

15,383

 

 

 

14,586

 

 

 

58,680

 

 

 

57,264

 

Interest expense

 

 

 

 

 

 

 

 

 

 

 

Deposits and escrow interest

 

1,212

 

 

 

1,519

 

 

 

5,075

 

 

 

7,891

 

FHLB advances

 

242

 

 

 

486

 

 

 

1,166

 

 

 

2,031

 

Total interest expense

 

1,454

 

 

 

2,005

 

 

 

6,241

 

 

 

9,922

 

Net interest income

 

13,929

 

 

 

12,581

 

 

 

52,439

 

 

 

47,342

 

Provision (benefit) for loan losses

 

209

 

 

 

5

 

 

 

772

 

 

 

(673

)

Net interest income after provision (benefit) for loan losses

 

13,720

 

 

 

12,576

 

 

 

51,667

 

 

 

48,015

 

Noninterest income

 

 

 

 

 

 

 

 

 

 

 

Fees and service charges

 

442

 

 

 

390

 

 

 

1,640

 

 

 

1,428

 

Bank-owned life insurance

 

186

 

 

 

168

 

 

 

754

 

 

 

549

 

Gain on sale of premises

 

-

 

 

 

-

 

 

 

548

 

 

 

-

 

Swap income

 

452

 

 

 

-

 

 

 

785

 

 

 

367

 

Gains on sales of loans receivable

 

-

 

 

 

-

 

 

 

56

 

 

 

-

 

Gains on sales of securities

 

-

 

 

 

-

 

 

 

-

 

 

 

113

 

Other

 

8

 

 

 

10

 

 

 

36

 

 

 

40

 

Total noninterest income

 

1,088

 

 

 

568

 

 

 

3,819

 

 

 

2,497

 

Noninterest expense

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

6,063

 

 

 

5,795

 

 

 

23,416

 

 

 

22,517

 

Occupancy and equipment

 

1,386

 

 

 

1,362

 

 

 

5,501

 

 

 

5,413

 

Merger-related expenses

 

1,166

 

 

 

-

 

 

 

1,252

 

 

 

-

 

Communication and data processing

 

585

 

 

 

525

 

 

 

2,211

 

 

 

2,064

 

Professional fees

 

403

 

 

 

405

 

 

 

1,673

 

 

 

1,690

 

Postage, printing, stationery and supplies

 

142

 

 

 

137

 

 

 

620

 

 

 

589

 

FDIC assessment

 

125

 

 

 

113

 

 

 

496

 

 

 

463

 

Advertising

 

177

 

 

 

100

 

 

 

477

 

 

 

400

 

Amortization of intangible assets

 

13

 

 

 

17

 

 

 

62

 

 

 

78

 

Other operating expenses

 

208

 

 

 

413

 

 

 

945

 

 

 

1,540

 

Total noninterest expense

 

10,268

 

 

 

8,867

 

 

 

36,653

 

 

 

34,754

 

Net income before income tax expense

 

4,540

 

 

 

4,277

 

 

 

18,833

 

 

 

15,758

 

Income tax expense

 

1,037

 

 

 

867

 

 

 

3,954

 

 

 

3,334

 

Net income

$

3,503

 

 

$

3,410

 

 

$

14,879

 

 

$

12,424

 

Earnings per common share:

 

 

 

 

 

 

 

 

 

 

 

Basic

$

0.25

 

 

$

0.23

 

 

$

1.05

 

 

$

0.84

 

Diluted

 

0.25

 

 

 

0.23

 

 

 

1.04

 

 

 

0.84

 

Weighted average common shares outstanding:

 

 

 

 

 

 

 

 

 

 

Basic

 

14,189,701

 

 

 

14,553,783

 

 

 

14,232,855

 

 

 

14,846,786

 

Diluted

 

14,248,141

 

 

 

14,586,928

 

 

 

14,289,020

 

 

 

14,847,579

 


PCSB Financial Corporation and Subsidiaries
Net Interest Margin Analysis (unaudited)
(dollar amounts in thousands)

 

 

Three Months Ended

 

 

 

June 30, 2022

 

 

March 31, 2022

 

 

June 30, 2021

 

 

 

Average Balance

 

 

Interest / Dividends

 

 

Average Rate

 

 

Average Balance

 

 

Interest / Dividends

 

 

Average Rate

 

 

Average Balance

 

 

Interest / Dividends

 

 

Average Rate

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans receivable (1)

 

$

1,313,296

 

 

$

12,801

 

 

 

3.90

%

 

$

1,255,117

 

 

$

11,943

 

 

 

3.81

%

 

$

1,245,610

 

 

$

12,625

 

 

 

4.06

%

Investment securities (1)

 

 

443,626

 

 

 

2,315

 

 

 

2.18

 

 

 

436,702

 

 

 

2,152

 

 

 

2.06

 

 

 

363,175

 

 

 

1,851

 

 

 

2.11

 

Other interest-earning assets

 

 

118,119

 

 

 

267

 

 

 

0.91

 

 

 

141,677

 

 

 

105

 

 

 

0.30

 

 

 

190,582

 

 

 

110

 

 

 

0.23

 

Total interest-earning assets

 

 

1,875,041

 

 

 

15,383

 

 

 

3.31

 

 

 

1,833,496

 

 

 

14,200

 

 

 

3.12

 

 

 

1,799,367

 

 

 

14,586

 

 

 

3.26

 

Non-interest-earning assets

 

 

79,993

 

 

 

 

 

 

 

 

 

77,202

 

 

 

 

 

 

 

 

 

79,015

 

 

 

 

 

 

 

Total assets

 

$

1,955,034

 

 

 

 

 

 

 

 

$

1,910,698

 

 

 

 

 

 

 

 

$

1,878,382

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOW accounts

 

$

224,808

 

 

 

91

 

 

 

0.16

 

 

$

215,021

 

 

 

94

 

 

 

0.18

 

 

$

182,475

 

 

 

69

 

 

 

0.15

 

Money market accounts

 

 

388,406

 

 

 

166

 

 

 

0.17

 

 

 

360,131

 

 

 

144

 

 

 

0.16

 

 

 

311,255

 

 

 

162

 

 

 

0.21

 

Savings accounts and mortgage escrow funds

 

 

427,709

 

 

 

124

 

 

 

0.12

 

 

 

415,850

 

 

 

113

 

 

 

0.11

 

 

 

387,422

 

 

 

109

 

 

 

0.11

 

Time deposits

 

 

335,748

 

 

 

831

 

 

 

0.99

 

 

 

349,266

 

 

 

866

 

 

 

1.00

 

 

 

395,240

 

 

 

1,179

 

 

 

1.20

 

Total interest-bearing deposits

 

 

1,376,671

 

 

 

1,212

 

 

 

0.35

 

 

 

1,340,268

 

 

 

1,217

 

 

 

0.37

 

 

 

1,276,392

 

 

 

1,519

 

 

 

0.48

 

FHLB advances

 

 

48,337

 

 

 

242

 

 

 

2.00

 

 

 

57,185

 

 

 

266

 

 

 

1.89

 

 

 

94,970

 

 

 

486

 

 

 

2.05

 

Total interest-bearing liabilities

 

 

1,425,008

 

 

 

1,454

 

 

 

0.41

 

 

 

1,397,453

 

 

 

1,483

 

 

 

0.43

 

 

 

1,371,362

 

 

 

2,005

 

 

 

0.59

 

Non-interest-bearing deposits

 

 

232,119

 

 

 

 

 

 

 

 

 

220,809

 

 

 

 

 

 

 

 

 

208,265

 

 

 

 

 

 

 

Other non-interest-bearing liabilities

 

 

19,581

 

 

 

 

 

 

 

 

 

15,370

 

 

 

 

 

 

 

 

 

23,114

 

 

 

 

 

 

 

Total liabilities

 

 

1,676,708

 

 

 

 

 

 

 

 

 

1,633,632

 

 

 

 

 

 

 

 

 

1,602,741

 

 

 

 

 

 

 

Total shareholders' equity

 

 

278,326

 

 

 

 

 

 

 

 

 

277,066

 

 

 

 

 

 

 

 

 

275,641

 

 

 

 

 

 

 

Total liabilities and shareholders' equity

 

$

1,955,034

 

 

 

 

 

 

 

 

$

1,910,698

 

 

 

 

 

 

 

 

$

1,878,382

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

 

 

 

 

$

13,929

 

 

 

 

 

 

 

 

$

12,717

 

 

 

 

 

 

 

 

$

12,581

 

 

 

 

Interest rate spread - tax equivalent (2)

 

 

 

 

 

 

 

 

2.90

 

 

 

 

 

 

 

 

 

2.69

 

 

 

 

 

 

 

 

 

2.67

 

Net interest margin - tax equivalent (3)

 

 

 

 

 

 

 

 

3.00

 

 

 

 

 

 

 

 

 

2.80

 

 

 

 

 

 

 

 

 

2.81

 

Average interest-earning assets to interest-bearing liabilities

 

 

131.58

%

 

 

 

 

 

 

 

 

131.20

%

 

 

 

 

 

 

 

 

131.21

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Tax exempt yield is shown on a tax equivalent basis for proper comparison using a statutory federal income tax rate of 21% for all periods presented. See reconciliation of GAAP to non-GAAP measures at the end of this release.

 

(2) Net interest rate spread represents the difference between the average yield on average interest-earning assets and the average cost of average interest-bearing liabilities.

 

(3) Net interest margin represents tax equivalent net interest income divided by average interest-earning assets. See reconciliation of GAAP to non-GAAP measures at the end of this release.

 


PCSB Financial Corporation and Subsidiaries
Net Interest Margin Analysis (unaudited)
(dollar amounts in thousands)

 

 

Year Ended June 30,

 

 

 

2022

 

 

2021

 

 

 

Average
Balance

 

 

Interest/
Dividends

 

 

Average
Rate

 

 

Average
Balance

 

 

Interest/
Dividends

 

 

Average
Rate

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans receivable (1)

 

$

1,258,513

 

 

$

49,502

 

 

 

3.94

%

 

$

1,245,818

 

 

$

49,470

 

 

 

3.97

%

Investment securities (1)

 

 

428,203

 

 

 

8,609

 

 

 

2.10

 

 

 

327,879

 

 

 

7,340

 

 

 

2.29

 

Other interest-earning assets

 

 

136,760

 

 

 

569

 

 

 

0.42

 

 

 

169,855

 

 

 

454

 

 

 

0.27

 

Total interest-earning assets

 

 

1,823,476

 

 

 

58,680

 

 

 

3.24

 

 

 

1,743,552

 

 

 

57,264

 

 

 

3.30

 

Non-interest-earning assets

 

 

77,769

 

 

 

 

 

 

 

 

 

72,522

 

 

 

 

 

 

 

Total assets

 

$

1,901,245

 

 

 

 

 

 

 

 

$

1,816,074

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOW accounts

 

$

203,804

 

 

 

345

 

 

 

0.17

 

 

$

160,652

 

 

 

296

 

 

 

0.18

 

Money market accounts

 

 

363,705

 

 

 

665

 

 

 

0.18

 

 

 

273,007

 

 

 

819

 

 

 

0.30

 

Savings accounts and escrow

 

 

409,732

 

 

 

458

 

 

 

0.11

 

 

 

369,681

 

 

 

611

 

 

 

0.17

 

Time deposits

 

 

352,474

 

 

 

3,607

 

 

 

1.02

 

 

 

421,168

 

 

 

6,165

 

 

 

1.46

 

Total interest-bearing deposits

 

 

1,329,715

 

 

 

5,075

 

 

 

0.38

 

 

 

1,224,508

 

 

 

7,891

 

 

 

0.64

 

FHLB advances

 

 

58,816

 

 

 

1,166

 

 

 

1.98

 

 

 

102,919

 

 

 

2,031

 

 

 

1.97

 

Total interest-bearing liabilities

 

 

1,388,531

 

 

 

6,241

 

 

 

0.45

 

 

 

1,327,427

 

 

 

9,922

 

 

 

0.75

 

Non-interest-bearing deposits

 

 

218,823

 

 

 

 

 

 

 

 

 

189,667

 

 

 

 

 

 

 

Other non-interest-bearing liabilities

 

 

17,785

 

 

 

 

 

 

 

 

 

25,707

 

 

 

 

 

 

 

Total liabilities

 

 

1,625,139

 

 

 

 

 

 

 

 

 

1,542,801

 

 

 

 

 

 

 

Total shareholders' equity

 

 

276,106

 

 

 

 

 

 

 

 

 

273,273

 

 

 

 

 

 

 

Total liabilities and shareholders' equity

 

$

1,901,245

 

 

 

 

 

 

 

 

$

1,816,074

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

 

 

 

 

$

52,439

 

 

 

 

 

 

 

 

$

47,342

 

 

 

 

Interest rate spread - tax equivalent (2)

 

 

 

 

 

 

 

 

2.79

 

 

 

 

 

 

 

 

 

2.55

 

Net interest margin - tax equivalent (3)

 

 

 

 

 

 

 

 

2.90

 

 

 

 

 

 

 

 

 

2.73

 

Average interest-earning assets to interest-bearing liabilities

 

 

131.32

%

 

 

 

 

 

 

 

 

131.35

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Tax exempt yield is shown on a tax equivalent basis for proper comparison using a statutory federal income tax rate of 21% for all periods presented. See reconciliation of GAAP to non-GAAP measures at the end of this release.

 

(2) Net interest rate spread represents the difference between the average yield on average interest-earning assets and the average cost of average interest-bearing liabilities.

 

(3) Net interest margin represents tax equivalent net interest income divided by average interest-earning assets. See reconciliation of GAAP to non-GAAP measures at the end of this release.

 


PCSB Financial Corporation and Subsidiaries
Condensed Financial Information (unaudited)
(amounts in thousands, except per share data)

 

 

As of

 

 

 

June 30,
2022

 

 

March 31,
2022

 

 

December 31,
2021

 

 

September 30,
2021

 

 

June 30,
2021

 

Condensed Balance Sheets

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

118,457

 

 

$

158,892

 

 

$

120,339

 

 

$

148,012

 

 

$

159,305

 

Total investment securities

 

 

447,070

 

 

 

448,081

 

 

 

433,999

 

 

 

423,525

 

 

 

394,971

 

Loans receivable, net

 

 

1,329,372

 

 

 

1,285,886

 

 

 

1,243,646

 

 

 

1,210,674

 

 

 

1,229,451

 

Other assets

 

 

94,233

 

 

 

91,682

 

 

 

90,137

 

 

 

90,968

 

 

 

91,208

 

Total assets

 

$

1,989,132

 

 

$

1,984,541

 

 

$

1,888,121

 

 

$

1,873,179

 

 

$

1,874,935

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total deposits and mortgage escrow funds

 

$

1,637,423

 

 

$

1,633,463

 

 

$

1,533,947

 

 

$

1,511,465

 

 

$

1,502,218

 

Advances from Federal Home Loan Bank

 

 

48,323

 

 

 

48,357

 

 

 

58,390

 

 

 

65,924

 

 

 

65,957

 

Other liabilities

 

 

26,224

 

 

 

26,329

 

 

 

20,950

 

 

 

21,062

 

 

 

32,200

 

Total liabilities

 

 

1,711,970

 

 

 

1,708,149

 

 

 

1,613,287

 

 

 

1,598,451

 

 

 

1,600,375

 

Total shareholders' equity

 

 

277,162

 

 

 

276,392

 

 

 

274,834

 

 

 

274,728

 

 

 

274,560

 

Total liabilities and shareholders' equity

 

$

1,989,132

 

 

$

1,984,541

 

 

$

1,888,121

 

 

$

1,873,179

 

 

$

1,874,935

 


 

 

Quarter Ended

 

 

Year Ended

 

 

 

June 30,
2022

 

 

March 31,
2022

 

 

December 31,
2021

 

 

September 30,
2021

 

 

June 30,
2021

 

 

June 30,
2022

 

 

June 30,
2021

 

Condensed Income Statements

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

$

15,383

 

 

$

14,200

 

 

$

14,870

 

 

$

14,227

 

 

$

14,586

 

 

$

58,680

 

 

$

57,264

 

Interest expense

 

 

1,454

 

 

 

1,483

 

 

 

1,612

 

 

 

1,692

 

 

 

2,005

 

 

 

6,241

 

 

 

9,922

 

Net interest income

 

 

13,929

 

 

 

12,717

 

 

 

13,258

 

 

 

12,535

 

 

 

12,581

 

 

 

52,439

 

 

 

47,342

 

Provision (benefit) for loan losses

 

 

209

 

 

 

286

 

 

 

264

 

 

 

13

 

 

 

5

 

 

 

772

 

 

 

(673

)

Noninterest income

 

 

1,088

 

 

 

923

 

 

 

1,195

 

 

 

613

 

 

 

568

 

 

 

3,819

 

 

 

2,497

 

Noninterest expense

 

 

10,268

 

 

 

8,956

 

 

 

8,805

 

 

 

8,624

 

 

 

8,867

 

 

 

36,653

 

 

 

34,754

 

Income before income tax expense

 

 

4,540

 

 

 

4,398

 

 

 

5,384

 

 

 

4,511

 

 

 

4,277

 

 

 

18,833

 

 

 

15,758

 

Income tax expense

 

 

1,037

 

 

 

924

 

 

 

1,096

 

 

 

897

 

 

 

867

 

 

 

3,954

 

 

 

3,334

 

Net income

 

$

3,503

 

 

$

3,474

 

 

$

4,288

 

 

$

3,614

 

 

$

3,410

 

 

$

14,879

 

 

$

12,424

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.25

 

 

$

0.25

 

 

$

0.30

 

 

$

0.25

 

 

$

0.23

 

 

$

1.05

 

 

$

0.84

 

Diluted

 

 

0.25

 

 

 

0.24

 

 

 

0.30

 

 

 

0.25

 

 

 

0.23

 

 

 

1.04

 

 

 

0.84

 


PCSB Financial Corporation and Subsidiaries
Selected Financial Data (unaudited)

 

 

Quarter Ended

 

 

Year Ended

 

 

 

June 30,
2022

 

 

March 31,
2022

 

 

December 31,
2021

 

 

September 30,
2021

 

 

June 30,
2021

 

 

June 30,
2022