BURR RIDGE, Ill., Jan. 31, 2024 (GLOBE NEWSWIRE) -- BankFinancial Corporation (Nasdaq – BFIN) (the "Company") announced today that the Company recorded net income of $9.4 million and basic and diluted earnings per common share of $0.74 for the year ended December 31, 2023. The Company recorded net income of $2.1 million and basic and diluted earnings per common share of $0.17 for the fourth quarter of 2023. Total assets at December 31, 2023, were $1.487 billion, a decline of $88.1 million (5.6%) compared to ...

BURR RIDGE, Ill., Jan. 31, 2024 (GLOBE NEWSWIRE) -- BankFinancial Corporation (Nasdaq – BFIN) (the “Company”) announced today that the Company recorded net income of $9.4 million and basic and diluted earnings per common share of $0.74 for the year ended December 31, 2023. The Company recorded net income of $2.1 million and basic and diluted earnings per common share of $0.17 for the fourth quarter of 2023. Total assets at December 31, 2023, were $1.487 billion, a decline of $88.1 million (5.6%) compared to ...

BURR RIDGE, Ill., Jan. 26, 2024 (GLOBE NEWSWIRE) -- BankFinancial Corporation (Nasdaq – BFIN) ("BankFinancial") announced that its Board of Directors declared a cash dividend of $0.10 per common share. The dividend will be payable on February 23, 2024, to stockholders of record on February 9, 2024. BankFinancial Corporation is the holding company for BankFinancial, NA, a national bank providing banking, wealth management and fiduciary services to individuals, families and businesses in the Chicago metropoli ...

BankFinancial (BFIN) is expected to deliver a year-over-year decline in earnings on lower revenues when it reports results for the quarter ended December 2023. This widely-known consensus outlook gives a good sense of the company's earnings picture, but how the actual results compare to these estimates is a powerful factor that could impact its near-term stock price.The earnings report might help the stock move higher if these key numbers are better than expectations. On the other hand, if they miss, the st ...

PART I [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited consolidated financial statements of BankFinancial Corporation, including the statements of financial condition, operations, comprehensive income, changes in stockholders' equity, and cash flows, along with detailed notes on accounting policies and specific financial items [Consolidated Statements of Financial Condition](index=4&type=section&id=Consolidated%20Statements%20of%20Financial%20Condition) | Metric | September 30, 2023 (in thousands) | December 31, 2022 (in thousands) | | :----------------------------------- | :-------------------------------- | :--------------------------------- | | Total assets | $1,505,454 | $1,575,442 | | Loans receivable, net | $1,105,604 | $1,226,743 | | Securities, at fair value | $158,425 | $210,338 | | Cash and cash equivalents | $171,561 | $66,771 | | Total deposits | $1,275,828 | $1,374,934 | | Borrowings | $25,000 | $0 | | Subordinated notes, net | $19,667 | $19,634 | | Total stockholders' equity | $153,755 | $151,671 | [Consolidated Statements of Operations](index=5&type=section&id=Consolidated%20Statements%20of%20Operations) | Metric | Three Months Ended Sep 30, 2023 (in thousands) | Three Months Ended Sep 30, 2022 (in thousands) | Nine Months Ended Sep 30, 2023 (in thousands) | Nine Months Ended Sep 30, 2022 (in thousands) | | :----------------------------------- | :--------------------------------------------- | :--------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Total interest income | $16,894 | $14,930 | $49,232 | $39,232 | | Total interest expense | $3,940 | $1,008 | $9,835 | $2,405 | | Net interest income | $12,954 | $13,922 | $39,397 | $36,827 | | (Recovery of) provision for credit losses | $136 | $350 | ($4) | $1,085 | | Total noninterest income | $1,240 | $1,287 | $2,792 | $4,570 | | Total noninterest expense | $10,790 | $10,601 | $32,302 | $31,089 | | Net income | $2,369 | $3,221 | $7,314 | $7,056 | | Basic and diluted EPS | $0.19 | $0.25 | $0.58 | $0.54 | [Consolidated Statements of Comprehensive Income](index=6&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income) | Metric | Three Months Ended Sep 30, 2023 (in thousands) | Three Months Ended Sep 30, 2022 (in thousands) | Nine Months Ended Sep 30, 2023 (in thousands) | Nine Months Ended Sep 30, 2022 (in thousands) | | :-------------------------------------------------- | :--------------------------------------------- | :--------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Net income | $2,369 | $3,221 | $7,314 | $7,056 | | Unrealized holding gain (loss) on securities, net of tax | $813 | ($2,662) | $1,672 | ($6,402) | | Reclassification adjustment for loss, net of tax | $0 | $0 | $335 | $0 | | Other comprehensive gain (loss), net of tax | $813 | ($2,662) | $2,007 | ($6,402) | | Comprehensive income | $3,182 | $559 | $9,321 | $654 | [Consolidated Statements of Changes in Stockholders' Equity](index=7&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Stockholders'%20Equity) | Metric | Sep 30, 2023 (in thousands) | Dec 31, 2022 (in thousands) | | :----------------------------------- | :-------------------------- | :-------------------------- | | Total Stockholders' Equity | $153,755 | $151,671 | | Net income (YTD) | $7,314 | $7,056 | | Other comprehensive income (loss), net of tax (YTD) | $2,007 | ($6,402) | | Repurchase and retirement of common stock (YTD) | ($1,717) | ($3,106) | | Cash dividends paid (YTD) | ($3,801) | ($3,944) | | Cumulative effect of change in accounting principle (YTD) | ($1,719) | $0 | [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) | Metric | Nine Months Ended Sep 30, 2023 (in thousands) | Nine Months Ended Sep 30, 2022 (in thousands) | | :----------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Net cash from operating activities | $5,218 | $489 | | Net cash from (used in) investing activities | $172,682 | ($217,844) | | Net cash used in financing activities | ($73,110) | ($68,676) | | Net change in cash and cash equivalents | $104,790 | ($286,031) | | Ending cash and cash equivalents | $171,561 | $216,131 | [NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES](index=9&type=section&id=NOTE%201%20-%20SUMMARY%20OF%20SIGNIFICANT%20ACCOUNTING%20POLICIES) - The Company adopted ASC 326 (Financial Instruments – Credit Losses) on January 1, 2023, using the modified retrospective approach, resulting in a net reduction of retained earnings by **$1.7 million**, an increase in credit-related reserves by **$1.9 million**, and the recording of an unfunded commitment reserve of **$417,000**, net of a **$604,000** increase in deferred tax assets[182](index=182&type=chunk)[188](index=188&type=chunk) - The Company also adopted ASU 2022-02, eliminating the Troubled Debt Restructurings (TDR) accounting model for creditors that have adopted ASC 326, and enhancing disclosure requirements for loan modifications and gross write-off information[196](index=196&type=chunk) [NOTE 2 - EARNINGS PER SHARE](index=13&type=section&id=NOTE%202%20-%20EARNINGS%20PER%20SHARE) | Metric | Three Months Ended Sep 30, 2023 | Three Months Ended Sep 30, 2022 | Nine Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2022 | | :------------------------------------------ | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Net income available to common stockholders | $2,369 | $3,221 | $7,314 | $7,056 | | Basic and diluted EPS | $0.19 | $0.25 | $0.58 | $0.54 | | Weighted average common shares outstanding | 12,578,494 | 13,060,266 | 12,655,305 | 13,142,584 | [NOTE 3 - SECURITIES](index=13&type=section&id=NOTE%203%20-%20SECURITIES) | Security Type | September 30, 2023 Fair Value (in thousands) | December 31, 2022 Fair Value (in thousands) | | :------------------------------------------ | :------------------------------------------- | :------------------------------------------- | | Certificates of deposit | $2,725 | $2,233 | | Municipal securities | $229 | $225 | | U.S. Treasury Notes | $123,095 | $163,103 | | U.S. government-sponsored agencies | $27,863 | $39,699 | | Mortgage-backed securities – residential | $3,480 | $3,881 | | Collateralized mortgage obligations – residential | $1,033 | $1,197 | | **Total Available-for-Sale Securities** | **$158,425** | **$210,338** | - The Company holds U.S. Treasury Notes, U.S. government-sponsored agencies, and other available-for-sale securities in an unrealized loss position at September 30, 2023, with these losses not recognized in income because the securities are high credit quality and the Company does not expect to sell them before anticipated recovery, with fair values expected to recover as maturity dates approach[209](index=209&type=chunk) | Metric | Nine Months Ended Sep 30, 2023 (in thousands) | | :---------------- | :-------------------------------------------- | | Proceeds from sales of securities | $42,631 | | Gross losses on sales of securities | ($454) | [NOTE 4 - LOANS RECEIVABLE](index=16&type=section&id=NOTE%204%20-%20LOANS%20RECEIVABLE) | Loan Class | September 30, 2023 (in thousands) | December 31, 2022 (in thousands) | | :----------------------------------- | :-------------------------------- | :--------------------------------- | | One-to-four family residential real estate | $19,233 | $23,133 | | Multi-family mortgage | $528,251 | $537,394 | | Nonresidential real estate | $117,641 | $119,705 | | Commercial loans and leases | $447,687 | $553,056 | | Consumer | $1,351 | $1,584 | | **Total Loans Receivable** | **$1,114,163** | **$1,234,872** | | Allowance for credit losses | ($8,559) | ($8,129) | | **Loans, net** | **$1,105,604** | **$1,226,743** | | Metric | Sep 30, 2023 (in thousands) | Dec 31, 2022 (in thousands) | | :----------------------------------- | :-------------------------- | :-------------------------- | | Nonaccrual loans | $23,508 | $1,407 | | Loans past due over 90 days, still accruing | $6,245 | $238 | | **Total Nonperforming Loans** | **$29,753** | **$1,645** | | Allowance for credit losses to total loans | 0.77% | 0.66% | | Allowance for credit losses to nonperforming loans | 28.77% | 494.16% | | Nonperforming loans to total loans | 2.67% | 0.13% | - The Company categorizes loans into risk categories (Pass, Watch, Special Mention, Substandard, Nonaccrual) based on borrower's ability to service debt, financial information, payment history, credit documentation, public information, and economic trends, with risk ratings updated as situations warrant[239](index=239&type=chunk)[240](index=240&type=chunk)[241](index=241&type=chunk)[242](index=242&type=chunk)[243](index=243&type=chunk) [NOTE 5 - FORECLOSED ASSETS](index=26&type=section&id=NOTE%205%20-%20FORECLOSED%20ASSETS) - Foreclosed assets, including Other Real Estate Owned (OREO) and other foreclosed assets, are initially recorded at fair value less estimated disposal costs, and if fair value is less than the loan balance, the difference is charged against the allowance for credit losses[251](index=251&type=chunk)[252](index=252&type=chunk) | Metric | Sep 30, 2023 (in thousands) | Dec 31, 2022 (in thousands) | | :-------------------------- | :-------------------------- | :-------------------------- | | Other real estate owned (Net Balance) | $468 | $472 | | Other foreclosed assets (Net Balance) | $434 | $4 | | **Total Foreclosed Assets** | **$902** | **$476** | | Metric | For the Three Months Ended Sep 30, 2023 (in thousands) | For the Nine Months Ended Sep 30, 2023 (in thousands) | | :----------------------------------- | :----------------------------------------------------- | :---------------------------------------------------- | | Beginning balance | $950 | $476 | | New foreclosed assets | $0 | $921 | | Valuation adjustments | ($48) | ($48) | | Sales | $0 | ($377) | | Ending balance | $902 | $902 | [NOTE 6 - BORROWINGS AND SUBORDINATED NOTES](index=27&type=section&id=NOTE%206%20-%20BORROWINGS%20AND%20SUBORDINATED%20NOTES) | Instrument | Contractual Rate (Sep 30, 2023) | Sep 30, 2023 Amount (in thousands) | Contractual Rate (Dec 31, 2022) | Dec 31, 2022 Amount (in thousands) | | :----------------------------------- | :------------------------------ | :--------------------------------- | :------------------------------ | :--------------------------------- | | Fixed-rate advance from FHLB, due Sep 16, 2024 | 4.55% | $5,000 | —% | $0 | | Fixed-rate advance from FHLB, due Mar 17, 2025 | 4.27% | $5,000 | —% | $0 | | Fixed-rate advance from FHLB, due Sep 17, 2025 | 4.20% | $5,000 | —% | $0 | | Fixed-rate advance from FHLB, due Mar 17, 2026 | 4.15% | $5,000 | —% | $0 | | Fixed-rate advance from FHLB, due Sep 17, 2026 | 4.06% | $5,000 | —% | $0 | | Subordinated notes, due May 15, 2031 | 3.75% | $19,667 | 3.75% | $19,634 | | Line of credit, due Mar 29, 2024 | 8.00% | $0 | 6.75% | $0 | - The Company's subordinated notes bear a fixed annual interest rate of **3.75%** until May 14, 2026, after which the rate will reset quarterly to Three-Month Term SOFR plus **299 basis points**, and these notes qualify as Tier 2 capital for regulatory purposes[4](index=4&type=chunk)[5](index=5&type=chunk) - The **$5.0 million** unsecured line of credit with a correspondent bank had no outstanding balance at September 30, 2023, and December 31, 2022, with its current maturity date being March 29, 2024[6](index=6&type=chunk) [NOTE 7 – FAIR VALUE](index=27&type=section&id=NOTE%207%E2%80%93%20FAIR%20VALUE) - Fair value measurements are categorized into three levels based on input observability: Level 1 (quoted prices in active markets), Level 2 (significant other observable inputs), and Level 3 (significant unobservable inputs)[7](index=7&type=chunk)[8](index=8&type=chunk) | Financial Instrument | Fair Value (Sep 30, 2023, in thousands) | Level 1 | Level 2 | Level 3 | | :----------------------------------- | :-------------------------------------- | :------ | :------ | :------ | | Cash and cash equivalents | $171,561 | $169,321 | $2,240 | $0 | | Securities | $158,425 | $123,095 | $35,330 | $0 | | Loans receivable, net | $1,049,622 | $0 | $0 | $1,049,622 | | FHLB and FRB stock | N/A | $0 | $0 | $0 | | Accrued interest receivable | $8,343 | $437 | $436 | $7,470 | | Certificates of deposit (Liabilities) | $217,933 | $0 | $217,933 | $0 | | Borrowings (Liabilities) | $24,621 | $0 | $24,621 | $0 | | Subordinated notes (Liabilities) | $17,171 | $0 | $17,171 | $0 | | Financial Instrument | Fair Value (Sep 30, 2023, in thousands) | Valuation Technique | Significant Unobservable Input(s) | Range (Weighted Average) | | :-------------------------- | :-------------------------------------- | :------------------ | :-------------------------------- | :----------------------- | | Other real estate owned | $468 | Sales comparison | Discount applied to valuation | 10.0% | | Other foreclosed assets | $387 | Sales comparison | Discount applied to valuation | 6.2% | [NOTE 8 – REVENUE FROM CONTRACTS WITH CUSTOMERS](index=34&type=section&id=NOTE%208%20%E2%80%93%20REVENUE%20FROM%20CONTRACTS%20WITH%20CUSTOMERS) | Noninterest Income Source | Three Months Ended Sep 30, 2023 (in thousands) | Three Months Ended Sep 30, 2022 (in thousands) | Nine Months Ended Sep 30, 2023 (in thousands) | Nine Months Ended Sep 30, 2022 (in thousands) | | :------------------------------------------ | :--------------------------------------------- | :--------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Deposit service charges and fees | $836 | $829 | $2,482 | $2,436 | | Loan servicing fees | $98 | $59 | $368 | $350 | | Trust and insurance commissions and annuities income | $290 | $287 | $933 | $887 | | Losses on sales of securities (1) | $0 | $0 | ($454) | $0 | | Gain on sale of premises and equipment | $0 | $0 | $9 | $0 | | Valuation adjustment on bank premises held-for-sale (1) | $0 | $0 | ($585) | $0 | | (Loss) earnings on bank-owned life insurance (1) | ($88) | ($14) | ($259) | $25 | | Bank-owned life insurance death benefit (1) | $0 | $0 | $0 | $446 | | Other (1) | $104 | $126 | $298 | $426 | | **Total noninterest income** | **$1,240** | **$1,287** | **$2,792** | **$4,570** | (1) Not within the scope of ASC 606 - Revenue streams accounted for under ASC 606 include deposit service charges and fees (transaction-based, account maintenance, overdraft), interchange income from debit card transactions, and trust and insurance commissions and annuities income (asset management, transaction-based, fixed fees)[28](index=28&type=chunk)[29](index=29&type=chunk)[30](index=30&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=35&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the Company's financial condition and operating results, including an overview of key financial metrics, a comparison of financial condition, and detailed analysis of operating results, critical accounting policies, and liquidity and capital resources [Cautionary Statement Regarding Forward-Looking Information](index=35&type=section&id=Cautionary%20Statement%20Regarding%20Forward-Looking%20Information) - The report contains forward-looking statements, identifiable by words like 'believe,' 'expect,' 'intend,' and 'anticipate,' which are subject to numerous uncertainties that could cause actual results to differ materially[33](index=33&type=chunk) - Key risk factors include interest rate movements, loan and deposit pricing, changes in government budgets, less than anticipated loan growth, impact of ASC 326, credit risks, adverse economic conditions, declines in real estate values, regulatory actions, financial market disruptions, monetary/fiscal policies, funding access, legislative changes, higher insurance premiums, increased operating costs, accounting changes, government shutdowns, and cybersecurity risks[34](index=34&type=chunk) [Critical Accounting Policies](index=35&type=section&id=Critical%20Accounting%20Policies) - Critical accounting policies involve significant judgments and uncertainties that could materially affect financial results under different assumptions, and these are detailed in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2022[36](index=36&type=chunk) [Overview](index=36&type=section&id=Overview) | Metric | September 30, 2023 (in thousands) | June 30, 2023 (in thousands) | | :----------------------------------- | :-------------------------------- | :--------------------------------- | | Net income (Q3) | $2,400 | N/A | | EPS (Q3) | $0.19 | N/A | | Total assets | $1,505,000 | N/A | | Total loans | $1,106,000 | N/A | | Total deposits | $1,276,000 | $1,303,900 | | Stockholders' equity | $153,800 | N/A | | Cash and interest-bearing deposits | $171,600 | $115,300 | | Loan to deposit ratio | 87% | 90% | | Net interest margin | 3.56% | 3.56% | | Tier 1 leverage ratio | 10.38% | N/A | | Tangible book value per common share | $12.25 | N/A | - Total net loans decreased by **$65.2 million (5.6%)** during Q3 2023, primarily due to declines in equipment finance, multi-family residential real estate, and commercial finance portfolios, while yields on loan originations decreased slightly to **9.11%** in Q3 2023 from **9.24%** in Q2 2023[39](index=39&type=chunk)[40](index=40&type=chunk) - Noninterest expense decreased **$430,000** in Q3 2023, driven by a **$260,000** decrease in compensation and benefits and a **$91,000** decrease in advertising and public relations[44](index=44&type=chunk) [Selected Financial Data](index=38&type=section&id=Selected%20Financial%20Data) | Metric | Sep 30, 2023 (in thousands) | Dec 31, 2022 (in thousands) | Change (in thousands) | | :----------------------------------- | :-------------------------- | :-------------------------- | :-------------------- | | Total assets | $1,505,454 | $1,575,442 | ($69,988) | | Loans, net | $1,105,604 | $1,226,743 | ($121,139) | | Securities, at fair value | $158,425 | $210,338 | ($51,913) | | Deposits | $1,275,828 | $1,374,934 | ($99,106) | | Borrowings | $25,000 | $0 | $25,000 | | Subordinated notes, net | $19,667 | $19,634 | $33 | | Equity | $153,755 | $151,671 | $2,084 | | Metric | Three Months Ended Sep 30, 2023 (in thousands) | Three Months Ended Sep 30, 2022 (in thousands) | Change (in thousands) | % Change | | :----------------------------------- | :--------------------------------------------- | :--------------------------------------------- | :-------------------- | :------- | | Interest income | $16,894 | $14,930 | $1,964 | 13.2% | | Interest expense | $3,940 | $1,008 | $2,932 | 290.9% | | Net interest income | $12,954 | $13,922 | ($968) | (7.0)% | | Provision for credit losses | $136 | $350 | ($214) | (61.1)% | | Noninterest income | $1,240 | $1,287 | ($47) | (3.7)% | | Noninterest expense | $10,790 | $10,601 | $189 | 1.8% | | Net income | $2,369 | $3,221 | ($852) | (26.5)% | | Ratio | Sep 30, 2023 | Sep 30, 2022 | | :----------------------------------- | :----------- | :----------- | | Return on average assets | 0.63% | 0.79% | | Return on average equity | 6.16% | 8.31% | | Net interest rate spread | 3.16% | 3.42% | | Net interest margin | 3.56% | 3.52% | | Efficiency ratio | 76.02% | 69.70% | | Allowance for credit losses to total loans | 0.77% | 0.66% | | Nonperforming loans to total loans | 2.67% | 0.13% | | Nonperforming assets to total assets | 2.04% | 0.13% | | Community Bank Leverage Ratio (Bank only) | 10.93% | 10.31% | [Comparison of Financial Condition at September 30, 2023 and December 31, 2022](index=40&type=section&id=Comparison%20of%20Financial%20Condition%20at%20September%2030,%202023%20and%20December%2031,%202022) - Total assets decreased by **$70.0 million (4.4%)** to **$1.505 billion**, primarily due to decreases in securities (**$51.9 million**) and loans receivable (**$121.1 million**), partially offset by a **$104.8 million** increase in cash and cash equivalents[56](index=56&type=chunk) - Total liabilities decreased by **$72.1 million (5.1%)** to **$1.352 billion**, driven by a **$99.1 million (7.2%)** decrease in total deposits, partially offset by an increase in borrowings[52](index=52&type=chunk) - Core deposits (savings, money market, noninterest-bearing demand, and NOW accounts) represented **82.7%** of total deposits at September 30, 2023, down from **86.4%** at December 31, 2022, while retail certificates of deposit increased by **$34.4 million (18.4%)**[52](index=52&type=chunk) - The loan portfolio, primarily investment and business loans (**98.2%** of gross loans), saw multi-family loans decrease by **$9.1 million (1.7%)** and commercial loans and leases decrease by **$105.4 million (19.1%)** during the nine months ended September 30, 2023[51](index=51&type=chunk) - Total stockholders' equity increased by **$2.1 million** to **$153.8 million**, driven by net income and an increase in accumulated other comprehensive income, partially offset by share repurchases, cash dividends, and a one-time accounting principle change[58](index=58&type=chunk) [Operating Results for the Three Months Ended September 30, 2023 and 2022](index=40&type=section&id=Operating%20Results%20for%20the%20Three%20Months%20Ended%20September%2030,%202023%20and%202022) - Net income for the three months ended September 30, 2023, was **$2.4 million ($0.19 EPS)**, a decrease from **$3.2 million ($0.25 EPS)** in the same period of 2022[59](index=59&type=chunk) - Net interest income decreased by **$968,000** to **$13.0 million**, primarily due to a **$2.9 million** increase in interest expense, with the net interest rate spread decreasing by **26 basis points** to **3.16%**, while the net interest margin increased by **four basis points** to **3.56%**[53](index=53&type=chunk)[61](index=61&type=chunk) | Metric | Three Months Ended Sep 30, 2023 (in thousands) | Three Months Ended Sep 30, 2022 (in thousands) | | :----------------------------------- | :--------------------------------------------- | :--------------------------------------------- | | Provision for credit losses – loans | $180 | $350 | | Net charge-offs | $847 | $166 | | Allowance for credit losses as % of nonperforming loans | 28.77% | 38.19% | | (Excluding U.S. Gov't transactions) | 78.78% | N/A | - Noninterest income decreased by **$47,000 (3.7%)** to **$1.2 million**, with loan servicing fees including **$52,000** of non-use fees in 2023 compared to **$2,000** in 2022[144](index=144&type=chunk) - Noninterest expense increased by **$189,000 (1.8%)** to **$10.8 million**, driven by increases in compensation and benefits, office occupancy and equipment, professional fees, and FDIC insurance premiums, partially offset by a decrease in other expenses due to a **$750,000** loss reserve recorded in Q3 2022 not recurring[68](index=68&type=chunk)[69](index=69&type=chunk) - Income tax expense was **$899,000**, with an effective tax rate of **27.5%** for Q3 2023, compared to **$1.0 million** and **24.4%** for Q3 2022[145](index=145&type=chunk) [Operating Results for the Nine Months Ended September 30, 2023 and 2022](index=45&type=section&id=Operating%20Results%20for%20the%20Nine%20Months%20Ended%20September%2030,%202023%20and%202022) - Net income for the nine months ended September 30, 2023, was **$7.3 million ($0.58 EPS)**, an increase from **$7.1 million ($0.54 EPS)** in the same period of 2022[71](index=71&type=chunk) - Net interest income increased by **$2.6 million** to **$39.4 million**, primarily due to a **$10.0 million** increase in interest income, with the net interest rate spread increasing by **24 basis points** to **3.27%**, and the net interest margin increasing by **48 basis points** to **3.59%**[72](index=72&type=chunk)[146](index=146&type=chunk) | Metric | Nine Months Ended Sep 30, 2023 (in thousands) | Nine Months Ended Sep 30, 2022 (in thousands) | | :----------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Provision for credit losses – loans | $85 | $1,100 | | Net charge-offs | $1,600 | $414 | | Allowance for credit losses as % of nonperforming loans | 28.77% | 494.16% | | (Excluding U.S. Gov't transactions) | 78.78% | N/A | - Noninterest income decreased by **$1.8 million (38.9%)** to **$2.8 million**, mainly due to losses on sales of investment securities (**$454,000**) and valuation adjustments on bank premises held-for-sale (**$585,000**), with the prior year including a **$446,000** bank-owned life insurance death benefit[148](index=148&type=chunk) - Noninterest expense increased by **$1.2 million (3.9%)** to **$32.3 million**, primarily due to increases in compensation and benefits, advertising, information technology, FDIC insurance premiums, and other expenses (including legal fees and write-downs on foreclosed assets)[81](index=81&type=chunk) - Income tax expense was **$2.6 million**, with an effective tax rate of **26.1%** for YTD Sep 30, 2023, compared to **$2.2 million** and **23.5%** for YTD Sep 30, 2022[82](index=82&type=chunk) [Criticized and Classified Assets](index=48&type=section&id=Criticized%20and%20Classified%20Assets) - The Company categorizes loans into risk categories (Pass, Watch, Special Mention, Substandard, Nonaccrual) based on borrower's ability to service debt, financial information, payment history, credit documentation, public information, and economic trends, with risk ratings updated as situations warrant[83](index=83&type=chunk) | Risk Category | Sep 30, 2023 (in thousands) | Dec 31, 2022 (in thousands) | | :-------------------------- | :-------------------------- | :-------------------------- | | Special Mention | $1,338 | $1,525 | | Substandard | $5,970 | $4,372 | | Nonaccrual | $23,508 | $1,407 | | **Total Criticized and Classified Loans** | **$30,816** | **$7,304** | [Nonperforming Loans and Assets](index=50&type=section&id=Nonperforming%20Loans%20and%20Assets) | Metric | Sep 30, 2023 (in thousands) | Jun 30, 2023 (in thousands) | Dec 31, 2022 (in thousands) | | :----------------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Nonaccrual loans | $23,508 | $24,158 | $1,407 | | Loans past due over 90 days, still accruing | $6,245 | $0 | $238 | | **Total Nonperforming Loans** | **$29,753** | **$24,158** | **$1,645** | | Foreclosed assets | $902 | $950 | $476 | | **Total Nonperforming Assets** | **$30,655** | **$25,108** | **$2,121** | | Nonperforming assets to total assets | 2.04% | 1.64% | 0.13% | - Nonperforming assets increased by **$5.5 million** to **$30.7 million** at September 30, 2023, primarily due to two transactions totaling **$6.2 million** that were past due 90 days or longer but remained on accrual status due to expected collection[86](index=86&type=chunk) - A Chapter 11 bankruptcy petition involving an equipment finance borrower with a **$3.2 million** exposure was converted to Chapter 7 liquidation, resulting in a **$700,000** charge-off and **$41,000** in professional fees, with collateral marketing commencing[87](index=87&type=chunk)[94](index=94&type=chunk) - Another equipment finance borrower with a **$786,000** exposure filed Chapter 7 bankruptcy due to alleged fraudulent activities, with efforts underway to trace and secure collateral, facing potential risks of unlocated collateral or inability to enforce security interests[89](index=89&type=chunk)[96](index=96&type=chunk) [Liquidity and Capital Resources](index=53&type=section&id=Liquidity%20and%20Capital%20Resources) - Primary funding sources include deposits, loan/security payments, wholesale borrowings, and proceeds from maturing securities, with the Company utilizing FHLB advances as an additional source, with **$25.0 million** outstanding at September 30, 2023[100](index=100&type=chunk) - The Company's primary source of liquidity is dividends from the Bank, subject to regulatory limitations, and as of September 30, 2023, the Company had **$10.8 million** in liquid assets and a **$5.0 million** unsecured line of credit with no outstanding balance[101](index=101&type=chunk) - The Bank's Community Bank Leverage Ratio was **10.93%** at September 30, 2023, exceeding the **9.00%** required for adequacy, and the Bank was well-capitalized under regulatory frameworks[105](index=105&type=chunk)[108](index=108&type=chunk)[115](index=115&type=chunk) - The Company declared cash dividends of **$0.10 per share** for each of the three months ended September 30, 2023 and 2022, totaling **$0.30 per share** for the nine-month periods[110](index=110&type=chunk) [Item 3. Quantitative and Qualitative Disclosure about Market Risk](index=54&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosure%20about%20Market%20Risk) This section discusses the Company's exposure to market risk, primarily interest rate risk, and its management strategies, including both qualitative and quantitative analyses of how changes in interest rates could impact net interest income and economic value of equity [Qualitative Analysis](index=54&type=section&id=Qualitative%20Analysis) - Interest rate risk arises from timing differences in asset/liability repricing, loan prepayments, deposit withdrawals, and yield curve changes, affecting net interest income, loan originations, and security values[111](index=111&type=chunk) - The Asset/Liability Management Committee (ALCO) evaluates and manages interest rate risk by modifying lending, investing, and deposit strategies, focusing on shorter-duration securities and variable-rate loans to match asset and liability maturities[112](index=112&type=chunk)[113](index=113&type=chunk) [Quantitative Analysis](index=56&type=section&id=Quantitative%20Analysis) | Change in Interest Rates (basis points) | Estimated Decrease in NPV (in thousands) | Percent Change in NPV | Estimated Increase in Net Interest Income (in thousands) | Percent Change in Net Interest Income | | :-------------------------------------- | :--------------------------------------- | :-------------------- | :------------------------------------------------------- | :------------------------------------ | | +400 | ($43,399) | (18.30)% | $3,777 | 6.88% | | +300 | ($27,298) | (11.51)% | $2,938 | 5.35% | | +200 | ($13,085) | (5.52)% | $2,124 | 3.87% | | +100 | ($3,428) | (1.45)% | $1,238 | 2.25% | | -100 | ($13,484) | (5.68)% | ($632) | (1.15)% | | -200 | ($21,440) | (9.04)% | ($2,219) | (4.04)% | | -300 | ($36,397) | (15.35)% | ($4,852) | (8.84)% | | -400 | ($54,875) | (23.14)% | ($8,079) | (14.71)% | - An immediate **200 basis point** decrease in interest rates is estimated to result in a **9.04%** decrease in Net Portfolio Value (NPV) and a **$2.2 million** decrease in net interest income, while a **200 basis point** increase is estimated to cause a **5.52%** decrease in NPV and a **$2.1 million** increase in net interest income[120](index=120&type=chunk) [Item 4. Controls and Procedures](index=57&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the effectiveness of the Company's disclosure controls and procedures as of September 30, 2023, and concluded they were effective, with no material changes to internal control over financial reporting during the quarter - The Company's disclosure controls and procedures were evaluated and deemed effective as of September 30, 2023[122](index=122&type=chunk) - No material changes to the Company's internal control over financial reporting occurred during the quarter ended September 30, 2023[123](index=123&type=chunk) PART II [Item 1. Legal Proceedings](index=58&type=section&id=Item%201.%20Legal%20Proceedings) The Company is involved in various legal actions in the normal course of business, but management believes their resolution will not have a material adverse effect on the Company's financial condition or results of operations - Resolution of current legal actions is not expected to have a material adverse effect on the Company's financial condition or results of operations[126](index=126&type=chunk) [Item 1A. Risk Factors](index=58&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the Company's SEC filings - No material changes to previously disclosed risk factors in SEC filings[127](index=127&type=chunk) [Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities](index=58&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities,%20Use%20of%20Proceeds,%20and%20Issuer%20Purchases%20of%20Equity%20Securities) This section reports on the Company's equity security activities, specifically noting no unregistered sales or use of proceeds, but detailing common stock repurchases during the third quarter of 2023 [Repurchases of Equity Securities](index=58&type=section&id=Repurchases%20of%20Equity%20Securities) | Period | Total Number of Shares Purchased | Average Price Paid Per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans | Maximum Number of Shares That May Yet Be Purchased Under the Plans | | :----------------------------------- | :------------------------------- | :--------------------------- | :--------------------------------------------------- | :----------------------------------------------------------------- | | July 1, 2023 through July 31, 2023 | 0 | $0 | 0 | 121,993 | | August 1, 2023 through August 31, 2023 | 36,858 | $8.70 | 36,858 | 85,135 | | September 1, 2023 through September 30, 2023 | 16,230 | $8.83 | 16,230 | 68,905 | | **Total for Q3 2023** | **53,088** | **N/A** | **53,088** | **68,905** | - As of September 30, 2023, the Company had repurchased **7,998,866 shares** out of **8,067,771** authorized under the current share repurchase program, with **68,905 shares** remaining authorized for repurchase[135](index=135&type=chunk) [Item 3. Default Upon Senior Securities](index=58&type=section&id=Item%203.%20Default%20Upon%20Senior%20Securities) The Company reported no defaults upon senior securities - No defaults upon senior securities[136](index=136&type=chunk) [Item 4. Mine Safety Disclosures](index=58&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) The Company has no mine safety disclosures to report - Not applicable[137](index=137&type=chunk) [Item 5. Other Information](index=58&type=section&id=Item%205.%20Other%20Information) No directors or executive officers adopted or terminated any Rule 10b5-1 trading arrangements during the third quarter of 2023 - No directors or executive officers adopted or terminated any Rule 10b5-1 trading arrangements during the third quarter of 2023[137](index=137&type=chunk) [Item 6. Exhibits](index=59&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Quarterly Report on Form 10-Q, including certifications from the CEO and CFO, and financial statements formatted in iXBRL - Exhibits include CEO and CFO certifications (Sections 302 and 906 of Sarbanes-Oxley Act) and financial statements formatted in Inline Extensive Business Reporting Language (iXBRL)[138](index=138&type=chunk) [Signatures](index=60&type=section&id=Signatures) The report is duly signed on behalf of BankFinancial Corporation by F. Morgan Gasior, Chairman of the Board, Chief Executive Officer and President, and Paul A. Cloutier, Executive Vice President and Chief Financial Officer, on October 30, 2023 - The report was signed by F. Morgan Gasior (Chairman, CEO, and President) and Paul A. Cloutier (EVP and CFO) on October 30, 2023[140](index=140&type=chunk)[141](index=141&type=chunk)[142](index=142&type=chunk)

BankFinancial Corporation (NASDAQ:BFIN) Q2 2023 Earnings Conference Call July 31, 2023 10:30 AM ET Company Participants F. Morgan Gasior - Chairman & Chief Executive Officer Katie Multon - Investor Relations Paul Cloutier - Executive Vice President of Finance, Chief Financial Officer & Treasurer Conference Call Participants Kevin Roth - Black Maple Capital Brian Martin - Janney Operator Good day and thank you for standing by and welcome to BankFinancial Corporation 2023 Q2 Earnings Conference Call. [Operato ...

Financial Performance - The company reported a net income of $2.3 million, or $0.18 per common share, for the quarter ended June 30, 2023[90]. - Net interest income decreased by $557,000 during the quarter ended June 30, 2023, with a net interest margin of 3.56% compared to 3.66% as of March 31, 2023[114]. - Noninterest income increased by $926,000 during the quarter ended June 30, 2023, with modest increases in deposit services and loan servicing fees[115]. - Noninterest expense increased by $928,000 during the quarter ended June 30, 2023, driven by higher information technology costs and professional fees[116]. - For the six months ended June 30, 2023, total noninterest expense increased to $21,512,000 from $20,488,000, reflecting a change of $1,024,000[176]. - The Company’s total compensation and benefits for the six months ended June 30, 2023, were $11,184,000, an increase of $215,000 from the prior year[176]. Assets and Liabilities - Total assets as of June 30, 2023, were $1.527 billion, with total loans at $1.171 billion and total deposits at $1.304 billion[90]. - Total stockholders' equity was reported at $152.3 million as of June 30, 2023[90]. - Cash and interest-bearing deposits totaled $115.3 million as of June 30, 2023, an increase from $77.0 million as of March 31, 2023[112]. - The company had no outstanding balance on its $5.0 million unsecured line of credit as of June 30, 2023[96]. - Fair value of total securities was $169.647 million as of June 30, 2023, compared to $210.338 million as of December 31, 2022[106]. Loan Performance - Total net loans decreased by $54.5 million (4.4%) during the quarter, primarily due to a $48.7 million decline in commercial loans and leases[91]. - The ratio of nonperforming loans to total loans increased to 2.05% as of June 30, 2023, compared to 0.72% as of March 31, 2023[117]. - The allowance for credit losses decreased to 0.78% of total loans as of June 30, 2023[117]. - The total loans receivable as of June 30, 2023, amounted to $1,179,993, a decrease from $1,234,872 as of December 31, 2022, reflecting a decline of approximately 4.4%[138]. - Nonaccrual loans totaled $24,158 as of June 30, 2023, with $23,965 attributed to commercial loans and leases[150]. - The total loans charged off amounted to $(281) as of June 30, 2023[146]. Securities and Investments - The company reported gross losses from securities sales of $454 for the three months ended June 30, 2023[135]. - The fair value of U.S. Treasury Notes held by the company was $118,375 with an unrealized loss of $6,101 as of June 30, 2023[131]. - The company holds $39,727 in U.S. government-sponsored agency securities, with an unrealized loss of $273 as of June 30, 2023[131]. - The total fair value of available-for-sale securities with unrealized losses was $165,943, reflecting an unrealized loss of $6,666 as of June 30, 2023[131]. - The company evaluated marketable investment securities quarterly and determined that no credit loss is required to be recognized as of June 30, 2023[134]. Risk and Compliance - The company is subject to various risks that could materially affect its operating results and financial condition, including interest rate movements and economic conditions[87]. - The Company incurred $441,000 in issuance costs associated with the $20.0 million 3.75% Fixed-to-Floating Rate Subordinated Notes due May 15, 2031[174]. - The Company had no consumer mortgage loans secured by residential real estate properties for which formal foreclosure proceedings were in process as of June 30, 2023[172]. - The Company experienced a $10.5 million scheduled payment failure on a U.S. government financing transaction during the second quarter of 2023[179]. Shareholder Information - The Company declared cash dividends of $0.20 per share for each of the six months ended June 30, 2023, and June 30, 2022[184]. - The Company repurchased 93,515 common shares during the quarter ended June 30, 2023[118]. - As of June 30, 2023, the Community Bank Leverage Ratio was 10.80%, compared to 10.31% as of December 31, 2022[184].

BankFinancial Corporation (NASDAQ:BFIN) Q1 2023 Earnings Conference Call May 3, 2023 9:30 AM ET Company Participants Katie Multon - Investor Relations F. Morgan Gasior - Chairman & Chief Executive Officer Conference Call Participants Manuel Navas - Davidson Brian Martin - Janney Operator Good day and thank you for standing by. Welcome to the BankFinancial Corporation First Quarter 2023 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now ...

Financial Performance - Net income for the three months ended March 31, 2023, was $2.6 million, up from $1.3 million for the same period in 2022, with earnings per share increasing to $0.21 [154]. - The net interest income for the quarter was $13.5 million, with a net interest margin of 3.66% [171]. - Net interest income increased by $2.7 million to $13.5 million for the three months ended March 31, 2023, driven by a $4.7 million increase in interest income [182]. - The net interest margin improved by 93 basis points to 3.66% for the three months ended March 31, 2023, from 2.73% for the same period in 2022 [183]. - Noninterest income declined by $1.1 million (78.3%) to $313,000 for the three months ended March 31, 2023, primarily due to losses on investment securities and branch valuation adjustments [188]. Asset and Liability Management - Total assets decreased by $31.3 million, or 2.0%, to $1.544 billion, primarily due to a $40.1 million decrease in securities [151]. - Total liabilities decreased by $32.0 million (2.2%) to $1.392 billion as of March 31, 2023 [181]. - Total stockholders' equity increased to $152.4 million, driven by net income and a $1.5 million increase in accumulated other comprehensive loss [153]. - Total deposits decreased by $59.7 million (4.3%) to $1.315 billion as of March 31, 2023, compared to December 31, 2022 [173]. - Average interest-earning assets decreased by $106.8 million, or 6.7%, to $1.494 billion [155]. Credit Quality - Nonperforming assets to total assets ratio increased to 0.66% from 0.13% [149]. - The provision for credit losses on loans for the three months ended March 31, 2023, was $85,000, a decrease from $276,000 in the same period in 2022 [160]. - The allowance for credit losses as a percentage of nonperforming loans was 113.20% at March 31, 2023, down from 494.16% at December 31, 2022 [161]. - Total nonperforming assets increased to $10.255 million as of March 31, 2023, compared to $2.121 million at December 31, 2022 [168]. Interest Rate Risk - The yield on interest-earning assets increased by 150 basis points to 4.39%, while the cost of interest-bearing liabilities rose by 75 basis points to 0.98% [155]. - The net interest rate spread increased by 75 basis points to 3.41% [155]. - As of March 31, 2023, a 200 basis point decrease in interest rates is expected to result in a 3.58% decrease in net present value (NPV) and a $1.2 million decrease in net interest income [238]. - Conversely, a 200 basis point increase in interest rates is projected to lead to a 3.62% decrease in NPV and a $1.1 million increase in net interest income [238]. - The dynamic GAP analysis identifies mismatches in the timing of asset and liability repricing but does not provide a precise indicator of interest rate risk due to certain inherent shortcomings [208]. Operational Efficiency - The efficiency ratio improved to 74.51% from 84.20% [149]. - The company experienced a decrease in deposit service charges and fees, totaling $816,000 for the quarter, up from $781,000 in the previous year [162]. Capital Management - The Company's Tier 1 leverage ratio was 10.03% as of March 31, 2023, indicating a strong capital position [175]. - The Company repurchased 48,604 common shares during the quarter ended March 31, 2023 [175]. - As of the reporting date, there are 215,508 shares remaining that may be purchased under publicly announced plans or programs [218]. Legal and Regulatory Considerations - The company is subject to various legal actions, but management believes these will not materially affect its financial condition or results of operations [212]. - The company’s investment securities and loan portfolios are significantly dependent on cash payments from government programs, which could be affected by federal debt ceiling issues [214]. - Retail deposit customers receiving federal payments may see a decrease in deposit balances if there are interruptions in these payments, impacting liquidity requirements [216]. Liquidity Management - The company aims to manage liquidity to meet financial commitments and take advantage of investment opportunities [169]. - The company’s Asset/Liability Management Committee evaluates interest rate risk and modifies strategies accordingly to manage exposure to changes in market interest rates [233]. - The company utilizes a combination of analyses, including economic value of equity analysis, to monitor exposure to interest rate changes [234].

ITEM 3. LEGAL PROCEEDINGS ITEM 4. MINE SAFETY DISCLOSURES 15 Total Number of Shares Purchased Average Price Paid per Share PART II Our shares of common stock are traded on the NASDAQ Global Select Market under the symbol "BFIN." The approximate number of holders of record of the Company's common stock as of January 31, 2023 was 975. Certain shares of the Company's common stock are held in "nominee" or "street" name, and accordingly, the number of beneficial owners of such shares is not known or included in ...