Core Viewpoint - Blue Foundry Bancorp (BLFY) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive outlook based on rising earnings estimates, which significantly influence stock prices [1][3]. Earnings Estimates and Stock Price Impact - The Zacks rating system is based on changes in earnings estimates, which are strongly correlated with near-term stock price movements [4][6]. - An increase in earnings estimates typically leads to higher fair value calculations by institutional investors, resulting in stock price movements [4]. Company Performance and Outlook - The upgrade for Blue Foundry Bancorp reflects an improvement in the company's underlying business, suggesting that investor sentiment may drive the stock price higher [5][10]. - Over the past three months, the Zacks Consensus Estimate for Blue Foundry Bancorp has increased by 7.1%, indicating a positive trend in earnings expectations [8]. Zacks Rating System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with a strong historical performance, particularly for Zacks Rank 1 stocks, which have generated an average annual return of +25% since 1988 [7]. - Blue Foundry Bancorp's upgrade to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting a strong potential for market-beating returns in the near term [9][10].

[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [ITEM 1. FINANCIAL STATEMENTS](index=3&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS) This section presents Blue Foundry Bancorp's unaudited consolidated financial statements for Q2 and H1 2025, detailing financial position and performance with accompanying notes [Consolidated Balance Sheets](index=3&type=section&id=CONSOLIDATED%20BALANCE%20SHEETS) Total assets increased to **$2.13 billion** by June 30, 2025, driven by loan growth, while liabilities rose to **$1.81 billion** and equity decreased to **$321.3 million** Consolidated Balance Sheet Summary (in thousands) | Account | June 30, 2025 (Unaudited) | December 31, 2024 (Audited) | | :--- | :--- | :--- | | **Total Assets** | **$2,127,504** | **$2,060,683** | | Cash and cash equivalents | $41,877 | $42,502 | | Securities (AFS & HTM) | $313,301 | $330,104 | | Loans receivable, net | $1,659,732 | $1,570,517 | | **Total Liabilities** | **$1,806,204** | **$1,728,485** | | Deposits | $1,416,321 | $1,343,320 | | Advances from FHLB | $343,000 | $339,500 | | **Total Shareholders' Equity** | **$321,300** | **$332,198** | [Consolidated Statements of Operations](index=4&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) For Q2 2025, net loss improved to **$2.0 million** from **$2.3 million** year-over-year, driven by a **$2.1 million** increase in net interest income, with the six-month net loss narrowing to **$4.6 million** Statement of Operations Summary (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | 6 Months 2025 | 6 Months 2024 | | :--- | :--- | :--- | :--- | :--- | | Total Interest Income | $23,438 | $21,292 | $46,151 | $42,134 | | Total Interest Expense | $11,798 | $11,719 | $23,767 | $23,144 | | **Net Interest Income** | **$11,640** | **$9,573** | **$22,384** | **$18,990** | | Provision for (release of) credit losses | $463 | $(762) | $664 | $(1,297) | | Total Non-interest Income | $405 | $536 | $799 | $987 | | Total Non-interest Expenses | $13,539 | $13,215 | $27,168 | $26,457 | | **Net Loss** | **$(1,957)** | **$(2,344)** | **$(4,649)** | **$(5,183)** | | **Diluted Loss Per Share** | **$(0.10)** | **$(0.11)** | **$(0.23)** | **$(0.24)** | [Consolidated Statements of Comprehensive Loss](index=5&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20COMPREHENSIVE%20LOSS) Comprehensive loss for Q2 2025 was **$2.4 million**, including a **$2.0 million** net loss and **$0.5 million** other comprehensive loss, resulting in a six-month comprehensive loss of **$4.2 million** Comprehensive Loss Summary (in thousands) | Metric | Q2 2025 | Q2 2024 | 6 Months 2025 | 6 Months 2024 | | :--- | :--- | :--- | :--- | :--- | | Net Loss | $(1,957) | $(2,344) | $(4,649) | $(5,183) | | Total Other Comprehensive (Loss) Income | $(473) | $292 | $409 | $1,997 | | **Comprehensive Loss** | **$(2,430)** | **$(2,052)** | **$(4,240)** | **$(3,186)** | [Consolidated Statements of Changes in Shareholders' Equity](index=6&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20CHANGES%20IN%20SHAREHOLDERS'%20EQUITY) Shareholders' equity decreased from **$332.2 million** at year-end 2024 to **$321.3 million** at June 30, 2025, primarily due to a **$4.6 million** net loss and **$8.6 million** in treasury stock purchases - For the six months ended June 30, 2025, total shareholders' equity decreased by **$10.9 million**[19](index=19&type=chunk) - Key drivers of the decrease in equity were the net loss of **$4.6 million** and the repurchase of treasury stock totaling **$8.6 million**[19](index=19&type=chunk) [Consolidated Statements of Cash Flows](index=8&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) For the six months ended June 30, 2025, cash and cash equivalents decreased by **$0.6 million**, with net cash used in operating and investing activities largely offset by financing activities driven by increased deposits Cash Flow Summary for Six Months Ended June 30 (in thousands) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $(1,785) | $9,270 | | Net cash (used in) provided by investing activities | $(67,427) | $1,648 | | Net cash provided by financing activities | $68,587 | $3,319 | | **Net (decrease) increase in cash and cash equivalents** | **$(625)** | **$14,237** | [Notes to the Consolidated Financial Statements](index=10&type=section&id=NOTES%20TO%20THE%20CONSOLIDATED%20FINANCIAL%20STATEMENTS) The notes detail financial accounts and policies, including securities portfolio unrealized losses, loan portfolio growth to **$1.67 billion**, a **$13.3 million** allowance for credit losses, and **$426.0 million** in interest rate swaps - The securities portfolio includes available-for-sale securities with a fair value of **$284.2 million** and held-to-maturity securities with an amortized cost of **$29.1 million**, with unrealized losses primarily due to interest rate changes, not credit quality[33](index=33&type=chunk)[35](index=35&type=chunk)[46](index=46&type=chunk) Loan Portfolio Composition (in thousands) | Loan Type | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Residential | $519,370 | $518,243 | | Multifamily | $633,849 | $671,116 | | Commercial real estate | $293,179 | $259,633 | | Construction | $97,207 | $85,546 | | Consumer and other | $83,706 | $7,211 | | **Total Loans** | **$1,673,036** | **$1,583,482** | - The allowance for credit losses on loans was **$13.3 million** at June 30, 2025, up from **$13.0 million** at year-end 2024, with a provision of **$350 thousand** recorded for the first six months of 2025[76](index=76&type=chunk)[82](index=82&type=chunk) - The company uses interest rate swaps with a total notional amount of **$426.0 million** as of June 30, 2025, designated as cash flow hedges against FHLB advances and brokered deposits[118](index=118&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=40&type=section&id=ITEM%202.%20MANAGEMENT'S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) Management discusses the company's financial performance, highlighting reduced net losses for Q2 and H1 2025 due to improved net interest income, alongside loan portfolio growth, deposit increases, and capital adequacy [Comparison of Operating Results](index=41&type=section&id=Comparison%20of%20Operating%20Results) Q2 2025 net loss improved to **$2.0 million** from **$2.3 million** year-over-year, driven by a **$2.1 million** increase in net interest income, despite higher credit loss provisions and non-interest expenses - Net interest income for Q2 2025 increased by **$2.1 million** year-over-year, with the net interest margin expanding by **32 basis points** to **2.28%**[166](index=166&type=chunk) - A provision for credit losses of **$463 thousand** was recorded in Q2 2025, compared to a **$762 thousand** release in Q2 2024, primarily due to growth in unfunded loan commitments and shifts in the loan portfolio composition[167](index=167&type=chunk) - Non-interest expense for Q2 2025 rose by **$324 thousand** year-over-year, driven by higher compensation, benefits, and data processing costs[169](index=169&type=chunk) [Comparison of Financial Condition](index=45&type=section&id=Comparison%20of%20Financial%20Condition) Total assets grew by **$66.8 million** to **$2.13 billion** by June 30, 2025, driven by **$89.6 million** loan growth and **$73.0 million** deposit increase, while equity decreased by **$10.9 million** - Gross loans increased by **$89.6 million** since year-end 2024, with significant growth in consumer loans (+$76.5 million) and commercial real estate loans (+$33.5 million)[188](index=188&type=chunk) - Total deposits grew by **$73.0 million**, or **5.4%**, since year-end 2024, supported by an increase in brokered deposits to **$225.0 million**[189](index=189&type=chunk) - Total shareholders' equity declined by **$10.9 million**, primarily due to the repurchase of shares at a cost of **$8.5 million** and the net loss for the period[192](index=192&type=chunk) [Liquidity and Capital Resources](index=48&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains strong liquidity with **$256.1 million** in FHLB borrowing capacity, exceeding all regulatory capital requirements and remaining 'well capitalized' with a **13.51%** Tier 1 leverage ratio - Available borrowing capacity at June 30, 2025, included **$256.1 million** from the FHLB of New York, a **$110.3 million** line with the Federal Reserve, and a **$30.0 million** unsecured line with a correspondent bank[205](index=205&type=chunk) Bank Regulatory Capital Ratios as of June 30, 2025 | Ratio | Actual | Minimum for Well Capitalized | | :--- | :--- | :--- | | Common equity tier 1 | 18.11% | 6.50% | | Tier 1 capital | 18.11% | 8.00% | | Total capital | 18.98% | 10.00% | | Tier 1 (leverage) capital | 13.51% | 5.00% | [Quantitative and Qualitative Disclosure About Market Risk](index=46&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURE%20ABOUT%20MARKET%20RISK) The company's primary market risk is interest rate risk, managed with **$426.0 million** in interest rate swaps, where a **100 basis point** rate increase would decrease Economic Value of Equity by **15.4%** - The company utilizes interest rate swaps to manage risk, with an aggregate notional amount of **$426 million** as of June 30, 2025[197](index=197&type=chunk) Net Interest Income Sensitivity Analysis (at June 30, 2025) | Change in Interest Rates (bps) | Change in NII (in thousands) | Percent Change | | :--- | :--- | :--- | | +200 | $1,309 | 2.5% | | +100 | $709 | 1.4% | | -100 | $907 | 1.7% | | -200 | $1,824 | 3.5% | Economic Value of Equity (EVE) Sensitivity Analysis (at June 30, 2025) | Change in Interest Rates (bps) | Change in EVE (in thousands) | Percent Change | | :--- | :--- | :--- | | +200 | $(68,059) | (30.9)% | | +100 | $(33,957) | (15.4)% | | -100 | $32,592 | 14.8% | | -200 | $66,292 | 30.1% | [Controls and Procedures](index=49&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) Management concluded that the company's disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting during the quarter - The Principal Executive Officer and Principal Financial Officer concluded that the company's disclosure controls and procedures were effective as of the end of the period covered by the report[209](index=209&type=chunk) [PART II. OTHER INFORMATION](index=49&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Legal Proceedings](index=49&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) The company is not currently involved in any material legal proceedings, and any normal course actions are not expected to materially affect its financial condition or operations - The Company is not engaged in any material legal proceedings at the present time[211](index=211&type=chunk) [Risk Factors](index=49&type=section&id=ITEM%201A.%20RISK%20FACTORS) There have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2024 - No material changes in risk factors have occurred since the last Annual Report on Form 10-K[212](index=212&type=chunk) [Unregistered Sales of Equity Securities, Use of Proceeds and Issuer Purchases of Equity Securities](index=50&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES.%20USE%20OF%20PROCEEDS%20AND%20ISSUER%20PURCHASES%20OF%20EQUITY%20SECURITIES) During Q2 2025, the company repurchased **406,391 shares** at an average price of **$9.45** per share and authorized a new program to repurchase up to **1,082,533 additional shares** Share Repurchases for Quarter Ended June 30, 2025 | Period | Total Shares Purchased | Average Price Paid Per Share | | :--- | :--- | :--- | | April | 231,145 | $9.04 | | May | 165,842 | $10.04 | | June | 9,404 | $8.98 | | **Total** | **406,391** | **$9.45** | - On June 18, 2025, the Company adopted its sixth repurchase program to repurchase up to **1,082,533 shares**, or **5%** of its outstanding common stock[214](index=214&type=chunk) [Defaults Upon Senior Securities](index=50&type=section&id=ITEM%203.%20DEFAULTS%20UPON%20SENIOR%20SECURITIES) Not applicable [Mine Safety Disclosures](index=50&type=section&id=ITEM%204.%20MINE%20SAFETY%20DISCLOSURES) Not applicable [Other Information](index=50&type=section&id=ITEM%205.%20OTHER%20INFORMATION) During Q2 2025, no directors or officers adopted or terminated any Rule 10b5-1 trading plans or other non-Rule 10b5-1 trading arrangements - No directors or officers adopted or terminated any contract, instruction or written plan for the purchase or sale of the Company's securities under Rule 10b5-1(c) during Q2 2025[217](index=217&type=chunk) [Exhibits](index=51&type=section&id=ITEM%206.%20EXHIBITS) This section lists the exhibits filed with or incorporated by reference into the Form 10-Q, including the company's certificate of incorporation, bylaws, and required certifications

Core Viewpoint - Blue Foundry Bancorp (BLFY) has shown a downtrend recently, losing 8.3% over the past four weeks, but a hammer chart pattern suggests a potential trend reversal as buying interest may be emerging to counteract selling pressure [1][2]. Technical Analysis - The hammer chart pattern indicates a possible bottoming out, with reduced selling pressure, suggesting that bulls may be gaining control [2][5]. - A hammer pattern forms when there is a small candle body with a long lower wick, indicating that the stock opened lower, made a new low, but closed near or above the opening price, reflecting buying interest [4][5]. Fundamental Analysis - There has been a positive trend in earnings estimate revisions for BLFY, which is a bullish indicator, as it typically leads to price appreciation [7]. - The consensus EPS estimate for the current year has increased by 7.1% over the last 30 days, indicating strong agreement among analysts regarding the company's improved earnings potential [8]. Zacks Rank - BLFY currently holds a Zacks Rank of 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks, which historically outperform the market [9][10]. - A Zacks Rank of 2 is a strong indicator of a potential trend reversal, as it reflects improving company prospects [10].

Financial Data and Key Metrics Changes - The company reported a net loss of $2,000,000 or $0.10 per diluted share, which is an improvement of $735,000 compared to the prior quarter [3][9] - Net interest income increased by $896,000 or 8.3%, driven by a 12 basis point expansion in the net interest margin [9][10] - Tangible book value per share increased to $14.87, up $0.06 from the prior quarter [7] Business Line Data and Key Metrics Changes - Core deposits grew by approximately 4%, contributing to a total deposit increase of $29,000,000 or 2% [5][13] - Loan production year-to-date totaled $180,000,000, with $90,000,000 produced during the second quarter at a weighted average yield of approximately 7% [5] - The company achieved approximately 3% loan growth during the quarter, with a notable increase in commercial and industrial loans by $22,000,000 [5][12] Market Data and Key Metrics Changes - The cost of deposits decreased by 13 basis points, contributing to a 12 basis point expansion in the net interest margin [5][10] - Nonperforming assets increased slightly, with nonperforming loans to total loans rising by three basis points, remaining low at 38 basis points [14] Company Strategy and Development Direction - The company is focused on portfolio diversification, prioritizing asset classes that deliver higher yields and better risk-adjusted returns [6] - There is a strategic emphasis on deepening client engagement in a competitive market, particularly with commercial customers [13][38] - The company aims to enhance shareholder value through disciplined capital management, including share repurchases [7] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about sustained momentum across lending and deposit fronts, expecting continued balance sheet and income growth [8] - The company anticipates limited expansion in net interest margin in the second half of the year, with more significant improvements expected in 2026 [24][28] Other Important Information - The company repurchased 406,000 shares at a weighted average price of $9.42, which is a significant discount to its tangible book value [7] - The allowance for credit losses to total loans decreased slightly to 80 basis points, indicating strong asset quality [14] Q&A Session Summary Question: Loan repricing and volume expectations for 2026 - Management indicated that significant loan repricing is expected in 2026, with $75,000,000 at a rate of $3.75 due to reprice [20] Question: CD pricing opportunities - Management noted that the pricing opportunity for CDs has largely run its course, and lower rates would be needed to see funding costs move appreciably lower [22] Question: Consumer loan portfolio expansion - Management is comfortable increasing the consumer loan portfolio from 5% to about 7-8% over the next couple of quarters [25] Question: Asset generation and noninterest-bearing deposits - The company is focusing on enhancing relationships with borrowers across various asset classes to grow noninterest-bearing deposits [38]

[Second Quarter 2025 Financial Highlights](index=1&type=section&id=Second%20Quarter%202025%20Financial%20Highlights) The company reported a net loss of **$2.0 million** and diluted loss per share of **$0.10**, while net interest margin expanded to **2.28%** and total loans and deposits grew | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | **Net Loss** | $2.0 million | $2.7 million | $2.3 million | | **Diluted Loss Per Share** | $0.10 | $0.13 | $0.11 | | **Net Interest Margin** | 2.28% | 2.16% | 1.96% | | **Total Loans** | $1.67 billion | $1.63 billion | $1.55 billion | | **Total Deposits** | $1.42 billion | $1.39 billion | $1.31 billion | - Management highlighted continued improvement driven by **net interest margin expansion**, stable expenses, and strong credit metrics, with margin expansion attributed to **better asset yields** and **lower liability costs**[3](index=3&type=chunk) - The company is executing a strategy to diversify its loan portfolio towards **higher-yield assets** and grow **core deposits** by focusing on full banking relationships with commercial customers[3](index=3&type=chunk) - During the quarter, the company repurchased **406,391 shares** at a weighted average price of **$9.42 per share** and commenced a new stock repurchase program for up to **1,082,533 shares**[6](index=6&type=chunk) [Financial Performance Analysis](index=2&type=section&id=Financial%20Performance%20Analysis) This section analyzes the company's financial performance across quarterly and year-to-date periods, highlighting trends in net interest income, expenses, and profitability [Second Quarter 2025 vs. First Quarter 2025 (QoQ)](index=2&type=section&id=Second%20quarter%20of%202025%20compared%20to%20the%20first%20quarter%20of%202025) Net loss narrowed to **$2.0 million** from **$2.7 million** quarter-over-quarter, driven by a **12 basis point expansion** in net interest margin to **2.28%** due to improved asset yields and lower liability costs | Metric | Q2 2025 | Q1 2025 | Change | | :--- | :--- | :--- | :--- | | **Net Interest Income** | $11.6M | $10.7M | +$0.9M | | **Net Interest Margin** | 2.28% | 2.16% | +12 bps | | **Yield on Avg. Earning Assets** | 4.58% | 4.51% | +7 bps | | **Cost of Avg. Interest-Bearing Liabilities** | 2.76% | 2.89% | -13 bps | - Non-interest expense decreased by **$90 thousand**, primarily due to a **$94 thousand reduction** in seasonal occupancy and equipment costs from the first quarter[11](index=11&type=chunk) - No income tax benefit was recorded for the net loss due to a **full valuation allowance** on the company's deferred tax assets[15](index=15&type=chunk) [Second Quarter 2025 vs. Second Quarter 2024 (YoY)](index=3&type=section&id=Second%20quarter%20of%202025%20compared%20to%20the%20second%20quarter%20of%202024) Compared to the same period last year, net loss slightly decreased from **$2.3 million** to **$2.0 million**, bolstered by a **$2.0 million increase** in net interest income and a **32 basis point expansion** in net interest margin, despite rising non-interest expenses | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | **Net Interest Income** | $11.6M | $9.6M | +$2.0M | | **Net Interest Margin** | 2.28% | 1.96% | +32 bps | | **Yield on Avg. Earning Assets** | 4.58% | 4.37% | +21 bps | | **Cost of Avg. Interest-Bearing Liabilities** | 2.76% | 2.94% | -18 bps | - Non-interest expense increased by **$324 thousand** year-over-year, driven by rises in **compensation and benefits ($185k)**, **data processing ($133k)**, and **advertising ($88k)**[13](index=13&type=chunk) [Six Months 2025 vs. Six Months 2024 (YTD)](index=3&type=section&id=Six%20Months%20Ended%20June%2030%2C%202025%20compared%20to%20the%20six%20months%20ended%20June%2030%2C%202024) For the first six months of 2025, net interest income grew by **$3.4 million** to **$22.4 million**, with net interest margin increasing by **28 basis points** to **2.22%**, while non-interest income fell and non-interest expenses rose | Metric | 6 Months 2025 | 6 Months 2024 | Change | | :--- | :--- | :--- | :--- | | **Net Interest Income** | $22.4M | $19.0M | +$3.4M | | **Net Interest Margin** | 2.22% | 1.94% | +28 bps | | **Yield on Avg. Earning Assets** | 4.55% | 4.30% | +25 bps | | **Cost of Avg. Interest-Bearing Liabilities** | 2.82% | 2.89% | -7 bps | - Non-interest income decreased by **$188 thousand** primarily because of gains on the sale of loans and REO property that occurred in the first half of 2024[14](index=14&type=chunk) - Non-interest expense for the six-month period rose by **$711 thousand**, mainly due to increases in **compensation and benefits ($474k)** and **data processing ($233k)**[21](index=21&type=chunk) [Balance Sheet Analysis (as of June 30, 2025)](index=1&type=section&id=Balance%20Sheet%20Analysis) This section analyzes the company's balance sheet, detailing changes in assets, liabilities, and capital, along with an assessment of asset quality [Assets](index=1&type=section&id=Assets) Total loans grew by **$89.6 million** in the first six months of 2025 to **$1.67 billion**, reflecting a strategic shift towards higher-yielding consumer and commercial loans, partially offset by a decrease in multifamily portfolio and securities | Loan Portfolio (in thousands) | June 30, 2025 | Dec 31, 2024 | Change YTD | | :--- | :--- | :--- | :--- | | Consumer and other | $83,706 | $7,211 | +$76,495 | | Commercial real estate | $293,179 | $259,633 | +$33,546 | | Construction | $97,207 | $85,546 | +$11,661 | | Multifamily | $633,849 | $671,116 | -$37,267 | | **Total Loans** | **$1,673,036** | **$1,583,482** | **+$89,554** | - The company is actively diversifying its loan portfolio, purchasing **$80.4 million in consumer loans** and **$25.5 million in residential loans** during the first half of 2025[5](index=5&type=chunk)[22](index=22&type=chunk) - Securities available-for-sale decreased by **$12.8 million** and securities held-to-maturity decreased by **$4.0 million** since year-end 2024 due to maturities, calls, and pay downs[17](index=17&type=chunk)[18](index=18&type=chunk) [Liabilities](index=2&type=section&id=Liabilities) Total deposits increased by **$73.0 million** in the first half of 2025 to **$1.42 billion**, driven by growth in NOW and demand accounts and time deposits, including brokered deposits, with uninsured deposits at a low **12%** | Deposit Portfolio (in thousands) | June 30, 2025 | Dec 31, 2024 | Change YTD | | :--- | :--- | :--- | :--- | | NOW and demand accounts | $431,485 | $369,554 | +$61,931 | | Time deposits | $730,778 | $707,339 | +$23,439 | | Savings | $228,897 | $240,426 | -$11,529 | | **Total Deposits** | **$1,416,321** | **$1,343,320** | **+$73,001** | - Core deposits grew by **$49.6 million** year-to-date, representing **48.4% of total deposits**, with the company's strategy focusing on attracting full banking relationships from small-to-medium-sized businesses[8](index=8&type=chunk)[22](index=22&type=chunk) - FHLB borrowings increased slightly by **$3.5 million** to **$343.0 million**, while the company maintains significant additional borrowing capacity of **$256.1 million** at the FHLB and **$110.3 million** at the Federal Reserve Bank[22](index=22&type=chunk) [Capital and Asset Quality](index=5&type=section&id=Capital%20and%20Asset%20Quality) Shareholders' equity declined by **$10.9 million** to **$321.3 million** since year-end, primarily due to **$8.5 million** in share repurchases, while capital ratios remain above 'well capitalized' standards and asset quality is strong with non-performing loans at **0.38%** - The decrease in shareholders' equity was primarily driven by the repurchase of shares at a cost of **$8.5 million** and the year-to-date net loss[27](index=27&type=chunk) | Metric | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | **Non-performing loans / Total loans** | 0.38% | 0.33% | | **Allowance for credit losses / Gross loans** | 0.80% | 0.83% | | **Allowance / Non-performing loans** | 211.81% | 254.02% | | **Tangible book value per share** | $14.87 | $14.74 | - The provision for credit losses was **$463 thousand** for the quarter, mainly driven by an increase in the provision for off-balance-sheet commitments and shifts in the loan portfolio composition[27](index=27&type=chunk) [Consolidated Financial Statements](index=7&type=section&id=Consolidated%20Financial%20Statements) This section presents the company's consolidated financial statements, including the balance sheet, income statement, key financial highlights, and a detailed analysis of net interest income [Consolidated Statements of Financial Condition](index=7&type=section&id=Consolidated%20Statements%20of%20Financial%20Condition) As of June 30, 2025, total assets were **$2.13 billion**, supported by **$1.66 billion** in net loans, with total liabilities at **$1.81 billion** mainly from **$1.42 billion** in deposits and **$343 million** in FHLB advances, and total shareholders' equity at **$321.3 million** Consolidated Balance Sheet (in thousands) | | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$2,127,504** | **$2,060,683** | | Loans, net | $1,659,732 | $1,570,517 | | Securities (AFS & HTM) | $313,301 | $330,104 | | Cash and cash equivalents | $41,877 | $42,502 | | **Total Liabilities** | **$1,806,204** | **$1,728,485** | | Deposits | $1,416,321 | $1,343,320 | | FHLB Advances | $343,000 | $339,500 | | **Shareholders' Equity** | **$321,300** | **$332,198** | [Consolidated Statements of Operations](index=8&type=section&id=Consolidated%20Statements%20of%20Operations) For Q2 2025, the company reported **$11.6 million** in net interest income, a **$463 thousand** provision for credit losses, and **$13.5 million** in non-interest expenses, resulting in a net loss of **$2.0 million**, or **$0.10** per diluted share Consolidated Income Statement (in thousands) | | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Net Interest Income | $11,640 | $10,744 | $9,573 | | Provision for credit losses | $463 | $201 | ($762) | | Non-interest income | $405 | $394 | $536 | | Non-interest expense | $13,539 | $13,629 | $13,215 | | **Net Loss** | **($1,957)** | **($2,692)** | **($2,344)** | | **Diluted Loss Per Share** | **($0.10)** | **($0.13)** | **($0.11)** | [Consolidated Financial Highlights](index=9&type=section&id=Consolidated%20Financial%20Highlights) This section presents key performance and asset quality ratios over the past five quarters, highlighting the steady improvement in net interest margin to **2.28%** and strong asset quality with non-performing loans at **0.38%** Performance Ratios (%) | Ratio | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Net interest margin | 2.28 | 2.16 | 1.96 | | Efficiency ratio | 112.40 | 122.36 | 130.73 | | Loss on average assets | (0.37) | (0.53) | (0.47) | Asset Quality Ratios (%) | Ratio | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Non-performing loans to total loans | 0.38 | 0.35 | 0.40 | | Allowance for credit losses to total loans | 0.80 | 0.81 | 0.84 | [Analysis of Net Interest Income](index=10&type=section&id=Analysis%20of%20Net%20Interest%20Income) This detailed analysis breaks down net interest income components, showing an average yield on interest-earning assets of **4.58%** and an average cost of interest-bearing liabilities of **2.76%** for Q2 2025, resulting in a net interest spread of **1.82%** Quarterly Net Interest Margin Analysis | | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | **Avg. Yield on Earning Assets** | **4.58%** | **4.51%** | **4.37%** | | Avg. Yield on Loans | 4.80% | 4.72% | 4.56% | | **Avg. Cost of Int-Bearing Liabilities** | **2.76%** | **2.89%** | **2.94%** | | Avg. Cost of Deposits | 2.62% | 2.75% | 2.90% | | **Net Interest Rate Spread** | **1.82%** | **1.62%** | **1.43%** | | **Net Interest Margin** | **2.28%** | **2.16%** | **1.96%** | [Supplemental Information](index=12&type=section&id=Supplemental%20Information%20-%20Non-GAAP%20Financial%20Measures) This section provides additional financial details, including reconciliations for non-GAAP financial measures such as tangible book value per share and core deposits [Non-GAAP Financial Measures](index=12&type=section&id=Non-GAAP%20Financial%20Measures) This section provides reconciliations for non-GAAP metrics, including tangible book value per share which increased to **$14.87** and core deposits comprising **48.4%** of total deposits, with a pre-provision net loss of **$1.5 million** for the quarter Tangible Book Value Per Share Calculation (in thousands) | | June 30, 2025 | March 31, 2025 | | :--- | :--- | :--- | | Shareholders' equity | $321,300 | $326,663 | | Less: intangible assets | $134 | $189 | | **Tangible equity** | **$321,166** | **$326,474** | | Shares outstanding | 21,591,757 | 22,047,649 | | **Tangible book value per share** | **$14.87** | **$14.81** | - Core deposits, defined as total deposits less time deposits, were **$685.5 million**, representing **48.4% of total deposits** as of June 30, 2025[49](index=49&type=chunk)

Core Viewpoint - Blue Foundry Bancorp reported a net loss of $2.0 million for Q2 2025, showing improvement compared to previous quarters, with a focus on net interest margin expansion and credit metrics stability [1][2]. Financial Performance - The net loss for Q2 2025 was $2.0 million, or $0.10 per diluted common share, compared to a loss of $2.7 million in Q1 2025 and $2.3 million in Q2 2024 [1]. - Net interest income for Q2 2025 was $11.6 million, an increase from $10.7 million in Q1 2025 and $9.6 million in Q2 2024 [11][17]. - The net interest margin increased by 12 basis points to 2.28% compared to Q1 2025 and by 32 basis points compared to Q2 2024 [11][17]. Loan Portfolio - Total loans increased by $89.6 million to $1.67 billion during the first half of 2025, with significant growth in consumer loans ($76.5 million) and commercial real estate loans ($33.5 million) [4][26]. - The multifamily loan portfolio decreased by $37.3 million [4][26]. - The allowance for credit losses was 0.80% of gross loans as of June 30, 2025, with non-performing loans totaling $6.3 million, or 0.38% of total loans [31][39]. Deposit Growth - Total deposits increased by $73.0 million to $1.42 billion since December 31, 2024, driven by increases in NOW and demand accounts and time deposits [7][26]. - Core deposits increased by $49.6 million, representing 48.4% of total deposits as of June 30, 2025 [7][26]. - Brokered deposits rose to $225.0 million from $155.0 million at the end of 2024 [26]. Non-Interest Expenses - Non-interest expenses decreased by $90 thousand compared to Q1 2025, primarily due to lower occupancy and equipment costs [10]. - Non-interest expenses for Q2 2025 were $13.5 million, an increase from $13.2 million in Q2 2024, driven by higher compensation and benefits expenses [13]. Capital and Shareholder Equity - Shareholders' equity was $321.3 million as of June 30, 2025, a decrease of $10.9 million from December 31, 2024, mainly due to share repurchases [26]. - The tangible equity to tangible assets ratio was 15.10% [26][39]. Market Strategy - The company is focusing on diversifying its loan portfolio and attracting full banking relationships with small- to medium-sized businesses [2][7]. - The strategy has contributed to core deposit growth, particularly among commercial customers [2].

Core Viewpoint - Blue Foundry Bancorp will release its financial results for the second quarter of 2025 on July 30, 2025, and will hold a conference call to discuss these results with investors and analysts [1][2]. Group 1: Financial Results Announcement - The financial results for the quarter ended June 30, 2025, will be available on the Company's website and the SEC's website [1]. - A conference call for investors and analysts is scheduled for July 30, 2025, at 11:00 AM (ET) to discuss the earnings [2]. Group 2: Conference Call Details - Participants are encouraged to pre-register for the webcast call to receive confirmation and calendar invitations [3]. - Dial-in options are available for those unable to join via webcast, with specific numbers provided for both U.S. and international participants [4]. Group 3: Company Overview - Blue Foundry Bancorp is the holding company for Blue Foundry Bank, which has a history of over 145 years and serves various counties in New Jersey [4]. - The bank focuses on providing tailored products and services to individuals and businesses, emphasizing its commitment to customers and communities [4].

Core Viewpoint - Blue Foundry Bancorp has authorized a sixth stock repurchase program to buy back up to 1,082,533 shares, representing approximately 5% of its outstanding common stock, which commenced on June 20, 2025 [1] Group 1: Stock Repurchase Program - The company has repurchased a total of 7,798,723 shares, or 27.3% of its common shares, since the first program was announced on July 20, 2022, at a weighted average price of $10.09 [2] - The new repurchase program allows for shares to be bought back in open market or private transactions, and the timing and amount of repurchases will depend on various factors including market conditions and the company's financial performance [3] Group 2: Management Commentary - The President and CEO of the company expressed satisfaction with the new repurchase program, highlighting the success of previous programs that allowed for share repurchases at a significant discount to tangible book value, which was $14.81 per share as of March 31, 2025 [4][2] - The CEO emphasized that share repurchases are a prudent use of capital and reflect the company's strong capital position [4] Group 3: Company Overview - Blue Foundry Bancorp is the holding company for Blue Foundry Bank, which serves various counties in New Jersey and offers tailored products and services to individuals and businesses [5] - The bank has a rich history of over 145 years and is committed to its customers and communities [5]

Financial Performance - The Company recorded a net loss of $2.7 million for Q1 2025, compared to a net loss of $2.8 million for Q1 2024, indicating a slight improvement [149]. - Non-interest income decreased by $57 thousand, or 12.6%, to $394 thousand in Q1 2025, primarily due to the absence of a gain on loan sales that occurred in the previous year [154]. - Non-interest expense increased by $387 thousand to $13.6 million in Q1 2025, driven by higher compensation and benefits expenses [155]. Interest Income and Loans - Interest income increased by $1.9 million, or 9.0%, to $22.7 million in Q1 2025, driven by higher rates on interest-earning assets [150]. - Net interest income rose to $10.7 million in Q1 2025, up from $9.4 million in Q1 2024, with a net interest rate spread of 1.62% and a net interest margin of 2.16% [152][159]. - The provision for credit losses was $201 thousand in Q1 2025, compared to a release of $535 thousand in Q1 2024, reflecting an increase in loan balances [153]. - Gross loans held for investment rose by $42.2 million to $1.63 billion at March 31, 2025, with notable increases in consumer and commercial real estate loans [162]. - Total loans increased to $1.625 billion at March 31, 2025, up from $1.583 billion at December 31, 2024, representing a growth of 2.7% [163]. Assets and Deposits - Total assets increased to $2.09 billion at March 31, 2025, from $2.06 billion at December 31, 2024 [160]. - Cash and cash equivalents increased by $3.7 million, or 9%, to $46.2 million at March 31, 2025 [160]. - Total deposits reached $1.39 billion at March 31, 2025, an increase of $43.9 million, or 3.3%, from December 31, 2024 [164]. - Core deposits accounted for 47.6% of total deposits at March 31, 2025, compared to 47.3% at December 31, 2024 [164]. Non-Performing Assets and Equity - Total non-performing assets rose to $5.723 million at March 31, 2025, compared to $5.104 million at December 31, 2024 [163]. - Total shareholders' equity decreased by $5.5 million, or 1.7%, to $326.7 million at March 31, 2025, primarily due to share repurchases [166]. Capital and Regulatory Compliance - The bank was considered "well capitalized" under regulatory guidelines as of March 31, 2025, exceeding all applicable regulatory capital requirements [181]. - Common equity tier 1 capital as of March 31, 2025, is $287,537 thousand, representing a ratio of 18.58% [182]. - Total capital as of March 31, 2025, is $300,942 thousand, with a ratio of 19.45% [182]. - Tier 1 capital as of March 31, 2025, stands at $287,537 thousand, with a ratio of 18.58% [182]. - The capital buffer for common equity tier 1 as of March 31, 2025, is $108,302 thousand, exceeding the minimum requirement of 7.00% [182]. - The total capital ratio as of March 31, 2025, exceeds the minimum requirement of 10.50% by reaching 19.45% [182]. - The leverage ratio for tier 1 capital as of March 31, 2025, is 13.73%, above the minimum requirement of 4.00% [182]. Interest Rate Risk - Estimated changes in net interest income indicate a potential increase of $1,682 thousand, or 3.4%, with a 200 basis point increase in interest rates [174]. - The estimated economic value of equity (EVE) would decrease by 33.1% with a 200 basis point increase in interest rates, indicating significant interest rate risk exposure [175].

Financial Data and Key Metrics Changes - The company reported a net loss of $2.7 million or 13¢ per diluted share for the first quarter, similar to the prior quarter [8] - Net interest income increased by $1.3 million or 13.4%, driven by a 27 basis point expansion in net interest margin [8][9] - Tangible book value per share increased to $14.81, up 7¢ from the prior quarter [6] Business Line Data and Key Metrics Changes - Loan production totaled $90 million during the quarter with a weighted average yield of approximately 7.1% [5] - The company achieved 3% loan growth while improving the yield on the loan portfolio by 15 basis points [4] - The growth in commercial real estate loans, particularly owner-occupied properties, and construction lending reflects the company's strategy to support local businesses [5][6] Market Data and Key Metrics Changes - Deposits increased by $43.9 million or 3.2%, with core deposit count growing by $24.4 million or 3.8% [12][13] - The company maintains a strong liquidity position with $413 million in untapped borrowing capacity [7] Company Strategy and Development Direction - The strategic priorities for 2025 focus on driving loan growth, maintaining strong credit quality, and diversifying low-cost funding sources [3] - The company is emphasizing asset classes that deliver higher yield and better risk-adjusted returns [5][6] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the momentum of lending and deposit gathering activities despite reporting a net loss [4] - The company expects additional margin expansion of about 5 to 10 basis points in the second quarter [16] Other Important Information - The company repurchased 464,000 shares at a weighted average price of $9.52, enhancing shareholder value [6][7] - Nonperforming assets increased slightly but remain low at 27 basis points of total assets [14] Q&A Session Summary Question: Margin for the quarter - Management expects margin expansion of about 5 to 10 basis points in the second quarter [16] Question: Loan maturities and resets - Approximately $220 million in loans will mature or reprice within 2025, with yields just shy of 7% [17] Question: Deposit side and CD book - The current cost of CDs is $4.11, with room to lower rates as they transition to core deposits [19][20] Question: Unsecured consumer loans - The yield on unsecured consumer loans is around 7%, and they come with credit reserves [21][23] Question: Future loan purchases - The company may purchase additional loans to augment organic growth but does not plan to rely heavily on this strategy long-term [24] Question: Buyback program - The company plans to continue executing the share buyback program while being mindful of capital deployment [49][52]