Core Points - NorthEast Community Bancorp, Inc. reported a net income of $11.2 million for Q2 2025, a decrease from $12.8 million in Q2 2024, and a net income of $21.7 million for the first half of 2025, down from $24.2 million in the same period of 2024 [1][2] Financial Performance - For the three months ended June 30, 2025, net interest income was $25.1 million, down 4.4% from $26.2 million in Q2 2024 [25] - Total interest and dividend income decreased by $2.2 million, or 5.5%, to $38.0 million for Q2 2025 compared to $40.2 million for Q2 2024 [26] - Interest expense decreased by $1.1 million, or 7.5%, to $13.0 million for Q2 2025 from $14.0 million in Q2 2024 [27] - The net interest margin decreased by 44 basis points to 5.35% for Q2 2025 compared to 5.79% for Q2 2024 [28] Balance Sheet Summary - Total assets decreased by $35.7 million, or 1.8%, to $2.0 billion at June 30, 2025, primarily due to decreases in cash and cash equivalents, net loans, and real estate owned [3] - Cash and cash equivalents decreased by $18.9 million, or 24.1%, to $59.4 million at June 30, 2025 [4] - Total deposits decreased by $191.2 million, or 11.5%, to $1.5 billion at June 30, 2025 [17] Loan Portfolio - Loans, net of the allowance for credit losses, decreased by $14.9 million, or 0.8%, to $1.8 billion at June 30, 2025 [7] - The company originated loans totaling $462.7 million during the first half of 2025, primarily in construction and multi-family loans [10] Asset Quality - The allowance for credit losses related to loans decreased to $4.7 million, or 0.26% of total loans, as of June 30, 2025 [56] - Non-performing assets were $767,000 at June 30, 2025, significantly down from $5.1 million at December 31, 2024 [54][55] Stockholders' Equity - Total stockholders' equity increased by $18.3 million, or 5.8%, to $336.7 million at June 30, 2025 [24] - The company's total stockholders' equity to assets ratio was 17.06% as of June 30, 2025 [58] Non-Interest Income and Expenses - Non-interest income for Q2 2025 was $858,000, an increase of 17.4% from $731,000 in Q2 2024 [33] - Non-interest expense increased by $1.0 million, or 10.6%, to $10.5 million for Q2 2025 compared to $9.5 million for Q2 2024 [36]

Group 1 - Northeast Community Bancorp (NASDAQ: NECB) is viewed positively by analysts, indicating strong growth potential in the banking sector [1] - The focus of Crude Value Insights is on cash flow generation within the oil and natural gas industry, highlighting the importance of financial health for investment opportunities [1] - The service offers subscribers access to a stock model account and detailed cash flow analyses of exploration and production firms, enhancing investment decision-making [2] Group 2 - Subscribers can engage in live discussions about the oil and gas sector, fostering a community for sharing insights and strategies [2] - A promotional offer is available for a two-week free trial, encouraging new users to explore the services provided [3]

Core Viewpoint - Zacks emphasizes a ranking system focused on earnings estimates and revisions to identify winning stocks, while also considering trends in value, growth, and momentum for investment opportunities [1][2]. Value Investing - Value investing is a popular strategy that utilizes fundamental analysis and metrics to identify undervalued companies based on their current share prices [2]. Zacks Style Scores System - Zacks has developed a Style Scores system to identify stocks with specific traits, particularly highlighting the "Value" category for value investors [3]. Northeast Community Bancorp (NECB) - NECB holds a Zacks Rank of 2 (Buy) and a Value grade of A, with a current P/E ratio of 7.41, significantly lower than the industry average P/E of 9.87 [4]. - The Forward P/E for NECB has ranged from 6.19 to 10.12 over the past year, with a median of 7.81 [4]. - NECB's P/CF ratio is 6.82, which is attractive compared to the industry's average P/CF of 16.02, indicating potential undervaluation based on cash flow [5]. - Over the past 52 weeks, NECB's P/CF has fluctuated between 4.63 and 8.35, with a median of 6.56 [5]. - The combination of NECB's strong earnings outlook and attractive valuation metrics suggests it is currently an impressive value stock [6].

PART I — FINANCIAL INFORMATION [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) Presents unaudited consolidated financial statements for Q1 2025 and prior periods, with detailed notes on accounting policies and capital [Consolidated Statements of Financial Condition](index=4&type=section&id=Consolidated%20Statements%20of%20Financial%20Condition) Total assets and liabilities decreased, while stockholders' equity increased for Q1 2025 compared to Q4 2024 | Metric | March 31, 2025 (In thousands) | December 31, 2024 (In thousands) | Change (In thousands) | % Change | | :-------------------------------- | :----------------------------- | :----------------------------- | :-------------------- | :------- | | Total assets | $1,933,376 | $2,009,581 | $(76,205) | -3.79% | | Total liabilities | $1,606,166 | $1,691,240 | $(85,074) | -5.03% | | Total stockholders' equity | $327,210 | $318,341 | $8,869 | 2.78% | - Total assets decreased by **$76.2 million**, or **3.8%**, primarily due to decreases in net loans, partially offset by increases in cash and cash equivalents and equity securities[133](index=133&type=chunk) - Total deposits decreased by **$84.4 million**, or **5.1%**, mainly due to decreases in certificates of deposit and non-interest bearing deposits, partially offset by increases in NOW/money market and savings accounts[144](index=144&type=chunk) [Consolidated Statements of Income](index=6&type=section&id=Consolidated%20Statements%20of%20Income) Net income decreased by 7.1% for the three months ended March 31, 2025, compared to the same period in 2024, driven by lower net interest income and higher credit loss provision | Metric | Three Months Ended March 31, 2025 (In thousands) | Three Months Ended March 31, 2024 (In thousands) | Change (In thousands) | % Change | | :------------------------------------------ | :--------------------------------------------- | :--------------------------------------------- | :-------------------- | :------- | | Total Interest Income | $38,207 | $38,121 | $86 | 0.23% | | Total Interest Expense | $13,943 | $13,135 | $808 | 6.15% | | Net Interest Income | $24,264 | $24,986 | $(722) | -2.89% | | Provision for (reversal of) credit loss | $237 | $(165) | $402 | -243.64% | | Total Non-Interest Income | $1,235 | $554 | $681 | 122.92% | | Total Non-Interest Expenses | $10,619 | $9,681 | $938 | 9.69% | | Income Before Provision For Income Taxes | $14,643 | $16,024 | $(1,381) | -8.62% | | Provision For Income Taxes | $4,076 | $4,650 | $(574) | -12.34% | | NET INCOME | $10,567 | $11,374 | $(807) | -7.10% | | EARNINGS PER COMMON SHARE – BASIC | $0.80 | $0.87 | $(0.07) | -8.05% | | EARNINGS PER COMMON SHARE – DILUTED | $0.78 | $0.86 | $(0.08) | -9.30% | [Consolidated Statements of Comprehensive Income](index=7&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income) Total comprehensive income for Q1 2025 was **$10.554 million**, a decrease from **$11.377 million** in the prior year, reflecting lower net income and an other comprehensive loss | Metric | Three Months Ended March 31, 2025 (In thousands) | Three Months Ended March 31, 2024 (In thousands) | | :-------------------------- | :--------------------------------------------- | :--------------------------------------------- | | Net Income | $10,567 | $11,374 | | Other comprehensive income (loss) | $(13) | $3 | | Total Comprehensive Income | $10,554 | $11,377 | [Consolidated Statements of Changes in Stockholders' Equity](index=8&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Stockholders'%20Equity) Stockholders' equity increased to **$327.2 million** at March 31, 2025, from **$318.3 million** at December 31, 2024, driven by net income and ESOP shares earned | Metric | March 31, 2025 (In thousands) | December 31, 2024 (In thousands) | | :-------------------------------- | :----------------------------- | :----------------------------- | | Total Stockholders' Equity | $327,210 | $318,341 | | Net income | $10,567 | N/A | | Other comprehensive loss | $(13) | N/A | | Cash dividend declared | $(2,683) | N/A | | ESOP shares earned | $520 | N/A | [Consolidated Statements of Cash Flows](index=9&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash provided by operating activities decreased, while investing activities shifted from a net use to a net provision of cash, and financing activities changed from a net provision to a net use of cash for Q1 2025 compared to Q1 2024 | Cash Flow Activity | Three Months Ended March 31, 2025 (In thousands) | Three Months Ended March 31, 2024 (In thousands) | | :----------------------------------- | :--------------------------------------------- | :--------------------------------------------- | | Net Cash Provided by Operating Activities | $10,943 | $12,908 | | Net Cash Provided by (Used in) Investing Activities | $86,038 | $(67,337) | | Net Cash (Used in) Provided by Financing Activities | $(85,782) | $93,206 | | Net Increase in Cash and Cash Equivalents | $11,199 | $38,777 | | Cash and Cash Equivalents – Ending | $89,458 | $107,448 | [Notes to Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Provides detailed disclosures on the Company's business, significant accounting policies, regulatory capital, earnings per share, and specific financial instruments and activities [Note 1 — Summary of Significant Accounting Policies](index=11&type=section&id=Note%201%20%E2%80%94%20Summary%20of%20Significant%20Accounting%20Policies) NorthEast Community Bancorp, Inc. operates as a Maryland corporation, with its primary activity being the ownership and operation of NorthEast Community Bank, a New York State-chartered savings bank - The Company's primary activity is the ownership and operation of NorthEast Community Bank, a New York State-chartered savings bank[23](index=23&type=chunk) - The Bank's principal business involves originating primarily construction loans, and to a lesser extent, commercial and industrial loans and multifamily and mixed-use residential real estate loans[25](index=25&type=chunk) - Lending activity is concentrated in construction loans in New York State, with significant portions in the Bronx (**$626.2 million**), Town of Monroe (**$222.4 million**), Hamlet of Monsey (**$87.6 million**), and Village of Spring Valley (**$140.4 million**) as of March 31, 2025[35](index=35&type=chunk) [Note 2 — Regulatory Capital](index=15&type=section&id=Note%202%20%E2%80%94%20Regulatory%20Capital) The Bank met all capital adequacy requirements and was categorized as 'well capitalized' under regulatory frameworks as of March 31, 2025, and December 31, 2024 | Capital Ratio | Actual Ratio (March 31, 2025) | Minimum Capital Adequacy | Well-Capitalized Standard | | :------------------------------------ | :---------------------------- | :----------------------- | :------------------------ | | Total capital (to risk weighted assets) | 15.10% | ≥8.00% | ≥10.00% | | Tier 1 capital (to risk weighted assets) | 14.79% | ≥6.00% | ≥8.00% | | Common equity tier 1 capital (to risk-weighted assets) | 14.79% | ≥4.50% | ≥6.50% | | Core (Tier 1) capital (to adjusted total assets) | 15.09% | ≥4.00% | ≥5.00% | - The Bank was categorized as '**well capitalized**' by the FDIC as of March 31, 2025, and December 31, 2024[38](index=38&type=chunk) [Note 3 — Earnings Per Share](index=15&type=section&id=Note%203%20%E2%80%94%20Earnings%20Per%20Share) Basic and diluted earnings per common share decreased for Q1 2025 compared to Q1 2024, reflecting lower net income and a higher weighted average number of diluted shares outstanding | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :------------------------------------ | :-------------------------------- | :-------------------------------- | | Net income (basic and diluted) | $10,567 | $11,374 | | Basic weighted average shares outstanding | 13,192 | 13,118 | | Diluted weighted average shares outstanding | 13,560 | 13,191 | | Net income per share - Basic | $0.80 | $0.87 | | Net income per share - Diluted | $0.78 | $0.86 | [Note 4 — Equity Securities](index=17&type=section&id=Note%204%20%E2%80%94%20Equity%20Securities) The Company's equity securities, primarily investments in a market-rate bond mutual fund, increased in fair value, recognizing an unrealized gain for Q1 2025 | Metric | March 31, 2025 (In Thousands) | December 31, 2024 (In Thousands) | | :-------------------------- | :---------------------------- | :---------------------------- | | Equity Securities, at Fair Value | $23,294 | $21,994 | | Metric | Three Months Ended March 31, 2025 (In Thousands) | Three Months Ended March 31, 2024 (In Thousands) | | :------------------------------------------------------- | :--------------------------------------------- | :--------------------------------------------- | | Net unrealized gain (loss) recognized on equity securities | $300 | $(82) | - The equity securities portfolio consists of investments in a market-rate bond mutual fund that invests in high-quality fixed-income bonds, mainly government agency securities, designed to positively impact community development[42](index=42&type=chunk) [Note 5 — Securities Held-to-Maturity](index=18&type=section&id=Note%205%20%E2%80%94%20Securities%20Held-to-Maturity) The Company's held-to-maturity securities portfolio saw a slight decrease in amortized cost, with unrealized losses deemed temporary due to high credit quality and intent to hold to maturity | Metric | March 31, 2025 (In Thousands) | December 31, 2024 (In Thousands) | | :-------------------------- | :---------------------------- | :---------------------------- | | Amortized Cost | $14,613 | $14,742 | | Fair Value | $11,643 | $11,858 | | Gross Unrealized Losses | $2,971 | $2,885 | | Allowance for Credit Loss | $126 | $126 | - Unrealized losses on mortgage-backed securities are attributed to interest rate volatility and are considered temporary, as the Company has the ability and intent to hold these securities to maturity[46](index=46&type=chunk) - The held-to-maturity portfolio includes agency mortgage-backed securities (explicitly or implicitly guaranteed by the U.S. government) and municipal bonds (rated no lower than A), all with a history of no credit losses[47](index=47&type=chunk) [Note 6 — Loans Receivable and the Allowance for Credit Losses](index=21&type=section&id=Note%206%20%E2%80%94%20Loans%20Receivable%20and%20the%20Allowance%20for%20Credit%20Losses) Total loans receivable decreased, primarily driven by a reduction in construction loans, while the allowance for credit losses on loans increased due to recoveries and provision expense | Loan Class | March 31, 2025 (In Thousands) | December 31, 2024 (In Thousands) | Change (In Thousands) | % Change | | :-------------------------- | :---------------------------- | :---------------------------- | :-------------------- | :------- | | Residential real estate | $283,026 | $236,649 | $46,377 | 19.60% | | Non-residential real estate | $29,198 | $29,446 | $(248) | -0.84% | | Construction | $1,287,225 | $1,426,167 | $(138,942) | -9.74% | | Commercial and industrial | $123,113 | $118,736 | $4,377 | 3.69% | | Consumer | $3,102 | $1,649 | $1,453 | 88.11% | | Total Loans | $1,725,664 | $1,812,647 | $(86,983) | -4.80% | | Allowance for credit losses | $5,127 | $4,830 | $297 | 6.15% | | ACL Activity (Three Months Ended March 31, 2025) | Amount (In Thousands) | | :----------------------------------------------- | :-------------------- | | Balance - December 31, 2024 | $4,830 | | Charge-offs | $(117) | | Recoveries | $352 | | Provision (reversal of) | $62 | | Balance - March 31, 2025 | $5,127 | - As of March 31, 2025, there were **no loans** past due 30 days or more, and **no non-accrual loans**[60](index=60&type=chunk)[61](index=61&type=chunk) - The allowance for credit losses for off-balance sheet commitments increased by **$175,000** to **$879,000** at March 31, 2025, due to an increase in unfunded off-balance sheet commitments[71](index=71&type=chunk)[157](index=157&type=chunk) [Note 7 — Real Estate Owned ("REO")](index=28&type=section&id=Note%207%20%E2%80%94%20Real%20Estate%20Owned%20(%22REO%22)) The Company held two foreclosed properties valued at **$5.12 million** at March 31, 2025, with REO expense increasing significantly for Q1 2025 due to higher operating costs - The Company owned two foreclosed properties valued at approximately **$5,120,000** at March 31, 2025, and December 31, 2024[72](index=72&type=chunk) | Metric | Three Months Ended March 31, 2025 (In thousands) | Three Months Ended March 31, 2024 (In thousands) | | :-------------------- | :--------------------------------------------- | :--------------------------------------------- | | REO expense | $30 | $11 | [Note 8 — Borrowings](index=28&type=section&id=Note%208%20%E2%80%94%20Borrowings) The Company had no outstanding borrowings from the FHLB or FRBNY at March 31, 2025, but maintained significant available borrowing capacity - No outstanding borrowings from FHLB or FRBNY at March 31, 2025, and December 31, 2024[75](index=75&type=chunk) | Borrowing Source | Available Borrowing Limit (March 31, 2025, In millions) | | :----------------- | :---------------------------------------------------- | | FRBNY | $941.3 | | FHLB | $15.5 | | ACBB | $8.0 | [Note 9 — Benefits Plans](index=30&type=section&id=Note%209%20%E2%80%94%20Benefits%20Plans) The Company maintains several benefit plans, with ESOP compensation expense increasing significantly for Q1 2025 compared to the prior year | Benefit Plan Expense | Three Months Ended March 31, 2025 (In thousands) | Three Months Ended March 31, 2024 (In thousands) | | :-------------------------------- | :--------------------------------------------- | :--------------------------------------------- | | DRP Net periodic pension expense | $30 | $31 | | SERP Expenses | $139 | $130 | | ESOP compensation expense | $520 | $352 | - The ESOP has two outstanding loans, with balances of **$478,000** and **$5,991,000** at March 31, 2025, which are being repaid through Bank contributions and dividends on ESOP shares[84](index=84&type=chunk) [Note 10 — Fair Value Disclosures](index=32&type=section&id=Note%2010%20%E2%80%94%20Fair%20Value%20Disclosures) The Company uses fair value measurements for certain assets and liabilities, primarily marketable equity securities (Level 1) and securities held-to-maturity (Level 2), with real estate owned and individually evaluated loans measured at fair value on a non-recurring basis using Level 3 inputs | Asset Type | Fair Value (March 31, 2025, In thousands) | Fair Value (December 31, 2024, In thousands) | Fair Value Hierarchy Level | | :-------------------------- | :---------------------------------------- | :---------------------------------------- | :------------------------- | | Marketable equity securities | $23,294 | $21,994 | Level 1 | | Securities held to maturity | $11,643 | $11,858 | Level 2 | | Loans receivable, net | $1,715,111 | $1,801,607 | Level 3 | | Real estate owned | $5,120 | $5,120 | Level 3 | - Fair value for real estate owned is determined through independent appraisals or estimations, adjusted by management for qualitative reasons and estimated liquidation expenses, using **Level 3 inputs**[94](index=94&type=chunk) - Individually evaluated loans are written down to fair value based on collateral valuations, discounted cash flows, and industry liquidation rates, classified as **Level 3** due to subjective assumptions[95](index=95&type=chunk) [Note 11 — Revenue Recognition](index=38&type=section&id=Note%2011%20%E2%80%94%20Revenue%20Recognition) The majority of the Company's revenue comes from interest income, which is outside the scope of ASC 606, while non-interest income streams within ASC 606 are recognized as performance obligations are satisfied | Non-Interest Income Source | Three Months Ended March 31, 2025 (In Thousands) | Three Months Ended March 31, 2024 (In Thousands) | ASC 606 Scope | | :------------------------------------ | :--------------------------------------------- | :--------------------------------------------- | :------------ | | Deposit-related fees and charges | $17 | $15 | Within | | Loan-related fees and charges | $456 | $211 | Not within | | Electronic banking fees and charges | $267 | $236 | Within | | Income from bank owned life insurance | $167 | $157 | Not within | | Unrealized gain (loss) on equity securities | $300 | $(82) | Not within | | Miscellaneous | $28 | $17 | Not within | | Total non-interest income | $1,235 | $554 | | - The Company does not typically enter into long-term revenue contracts with customers and does not experience significant contract balances[104](index=104&type=chunk)[105](index=105&type=chunk) [Note 12 — Other Non-Interest Expenses](index=41&type=section&id=Note%2012%20%E2%80%94%20Other%20Non-Interest%20Expenses) Other non-interest expenses increased for Q1 2025 compared to the prior year, primarily driven by increases in miscellaneous other expenses, regulatory fees, and legal fees | Expense Category | Three Months Ended March 31, 2025 (In Thousands) | Three Months Ended March 31, 2024 (In Thousands) | | :-------------------------- | :--------------------------------------------- | :--------------------------------------------- | | Other | $1,367 | $1,103 | | Service contracts | $423 | $424 | | Consulting expense | $191 | $231 | | Telephone | $143 | $170 | | Directors' compensation | $237 | $246 | | Audit and accounting | $143 | $135 | | Insurance | $106 | $102 | | Director, officer, and employee expense | $59 | $79 | | Legal fees | $98 | $66 | | Office supplies and stationary | $56 | $51 | | Recruiting expense | $32 | $27 | | Total | $2,855 | $2,634 | [Note 13 — Stock Compensation Plans](index=41&type=section&id=Note%2013%20%E2%80%94%20Stock%20Compensation%20Plans) The Company's 2022 Equity Incentive Plan allows for grants of various stock-based awards, with increased restricted stock compensation expense and significant unrecognized compensation costs remaining - The 2022 Equity Incentive Plan reserved **1,369,771 shares** for various stock-based awards[109](index=109&type=chunk) | Metric | Three Months Ended March 31, 2025 (In thousands) | Three Months Ended March 31, 2024 (In thousands) | | :-------------------------------- | :--------------------------------------------- | :--------------------------------------------- | | Restricted stock compensation expense | $293 | $252 | | Stock option compensation expense | $185 | $192 | - As of March 31, 2025, **$3.0 million** in compensation cost related to non-vested restricted stock awards and **$1.9 million** related to stock option awards remain unrecognized, expected to be recognized over the next three years[113](index=113&type=chunk)[116](index=116&type=chunk) [Note 14 — Business Segments](index=43&type=section&id=Note%2014%20%E2%80%94%20Business%20Segments) The Company operates as a single reportable operating segment, with its Executive Committee assessing performance on a consolidated basis using net income and other financial measures - All financial service operations are aggregated into one reportable operating segment[117](index=117&type=chunk) - The Executive Committee uses net income, net interest margin, return on average assets, and return on common equity to evaluate performance and allocate resources[119](index=119&type=chunk) | Metric | Three Months Ended March 31, 2025 (In Thousands) | Three Months Ended March 31, 2024 (In Thousands) | | :-------------------------- | :--------------------------------------------- | :--------------------------------------------- | | Total interest income | $38,207 | $38,121 | | Total interest expense | $13,943 | $13,135 | | Net interest income | $24,264 | $24,986 | | Segment net income | $10,567 | $11,374 | [Note 15 — Recent Accounting Pronouncements](index=45&type=section&id=Note%2015%20%E2%80%94%20Recent%20Accounting%20Pronouncements) The Company reviewed recent FASB Accounting Standards Updates (ASUs), including ASU 2023-06, ASU 2024-03, ASU 2024-04, and ASU 2025-01, none of which are expected to have a significant impact on its financial statements - ASU 2023-06 incorporates SEC disclosure requirements into US GAAP, effective when related SEC rules are removed[123](index=123&type=chunk)[124](index=124&type=chunk) - ASU 2024-03 (and its revision ASU 2025-01) requires disaggregation disclosures for certain costs and expenses for public business entities, effective for fiscal years beginning after December 15, 2026[125](index=125&type=chunk)[127](index=127&type=chunk) - ASU 2024-04 clarifies accounting for induced conversions of convertible debt instruments, effective for fiscal years beginning after December 15, 2025[126](index=126&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=47&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Provides management's perspective on the Company's financial condition and results of operations, including forward-looking statements, critical accounting policies, and detailed analysis of balance sheet changes, income statement performance, asset quality, liquidity, and capital resources for Q1 2025 [Forward-Looking Statements](index=47&type=section&id=Forward-Looking%20Statements) The Company includes forward-looking statements, which are subject to significant risks and uncertainties, and cautions readers that actual results may differ materially - Forward-looking statements are based on assumptions and describe future plans, strategies, and expectations, identifiable by words like 'believe,' 'expect,' 'intend,' 'anticipate,' 'estimate,' 'project,' 'plan'[128](index=128&type=chunk) - Key risk factors include general economic conditions, changes in interest rates, increased competitive pressures, changes in loan/investment portfolios, real estate market values, legislative/regulatory changes, technological changes, and cybersecurity risks[129](index=129&type=chunk)[131](index=131&type=chunk) [Critical Accounting Policies](index=49&type=section&id=Critical%20Accounting%20Policies) The Company identifies critical accounting policies as those involving significant management judgments and assumptions that could materially impact asset carrying values or income - Critical accounting policies involve significant judgments and assumptions that could materially impact the carrying value of assets or income[132](index=132&type=chunk) - Estimates are based on historical experience and reasonable factors, but actual results may differ, potentially impacting asset and liability carrying values and operating results[132](index=132&type=chunk) [Balance Sheet Analysis](index=49&type=section&id=Balance%20Sheet%20Analysis) Total assets decreased by **$76.2 million**, or **3.8%**, primarily due to a significant decrease in net loans, partially offset by increases in cash and cash equivalents and equity securities - Total assets decreased **$76.2 million** (**3.8%**) to **$1.9 billion** at March 31, 2025, from **$2.0 billion** at December 31, 2024[133](index=133&type=chunk) - Net loans decreased **$87.3 million** (**4.8%**), primarily due to a **$138.9 million** decrease in construction loans, offset by increases in multi-family, commercial and industrial, and consumer loans[137](index=137&type=chunk) - Total deposits decreased **$84.4 million** (**5.1%**), driven by a **$125.1 million** decrease in certificates of deposit (retail and brokered), partially offset by increases in NOW/money market and savings accounts[144](index=144&type=chunk) - Stockholders' equity increased **$8.9 million** (**2.8%**) to **$327.2 million**, primarily due to net income and ESOP shares earned, partially offset by dividends declared and other comprehensive loss[148](index=148&type=chunk)[150](index=150&type=chunk) [Results of Operations for the Three Months Ended March 31, 2025 and 2024](index=53&type=section&id=Results%20of%20Operations%20for%20the%20Three%20Months%20Ended%20March%2031%2C%202025%20and%202024) Net income decreased by **7.1%** year-over-year, primarily due to a decline in net interest income and an increase in credit loss provision, despite a significant rise in non-interest income - Net income decreased by **$807,000** (**7.1%**) to **$10.6 million** for the three months ended March 31, 2025, compared to **$11.4 million** in the prior year[151](index=151&type=chunk) - Net interest income decreased **$722,000** (**2.9%**) to **$24.3 million**, as interest expense growth outpaced interest income growth[152](index=152&type=chunk) - Net interest margin decreased **64 basis points** (**11.1%**) to **5.11%** for the three months ended March 31, 2025, from **5.75%** in the prior year[155](index=155&type=chunk) - Non-interest income increased **$681,000** (**122.9%**) to **$1.2 million**, driven by an unrealized gain on equity securities and higher loan fees[164](index=164&type=chunk) - Non-interest expense increased **$938,000** (**9.7%**) to **$10.6 million**, primarily due to higher salaries and employee benefits and other operating expenses[167](index=167&type=chunk) [Asset Quality](index=60&type=section&id=Asset%20Quality) Non-performing assets remained stable at **$5.1 million**, consisting entirely of real estate owned, with no non-accrual or past due loans, while the allowance for credit losses related to loans increased to **0.30%** of total loans | Metric | March 31, 2025 (In thousands) | December 31, 2024 (In thousands) | | :------------------------------------ | :---------------------------- | :---------------------------- | | Total non-accrual loans | $0 | $0 | | Total accruing loans past due 90 days or more | $0 | $0 | | Total non-performing loans | $0 | $0 | | Real estate owned | $5,120 | $5,120 | | Total non-performing assets | $5,120 | $5,120 | | Total non-performing assets to total assets | 0.26% | 0.25% | - The allowance for credit losses related to loans increased to **$5.1 million**, or **0.30%** of total loans, at March 31, 2025, from **$4.8 million**, or **0.27%**, at December 31, 2024[188](index=188&type=chunk) - Recoveries of **$352,000** were recorded during the three months ended March 31, 2025, primarily from a previously charged-off non-residential mortgage loan[161](index=161&type=chunk) [Liquidity and Capital Resources](index=62&type=section&id=Liquidity%20and%20Capital%20Resources) The Company maintains adequate liquidity through deposits, loan repayments, and investment maturities, supplemented by borrowing agreements with FHLB and FRBNY, with significant available borrowing capacity | Liquidity Ratio | Average for Three Months Ended March 31, 2025 | Target | | :------------------------------------------ | :-------------------------------------------- | :----- | | Cash Liquidity ratio | 6.1% | 2.0% | | On Balance Sheet Liquidity ratio | 8.4% | 8.0% | | On Balance Sheet Liquidity & Borrowing Capacity ratio | 74.2% | 20.0% | - Primary liquidity sources include deposits, prepayment of loans and mortgage-backed securities, maturities of investment securities, earnings, and funds from operations[195](index=195&type=chunk) - Available borrowing limits were **$941.3 million** from FRBNY and **$15.5 million** from FHLB at March 31, 2025, with no outstanding borrowings[198](index=198&type=chunk)[199](index=199&type=chunk) - Unfunded commitments totaled **$360.7 million** for construction/multi-family loans, **$205.9 million** for loan originations, **$81.9 million** for lines of credit, and **$14.9 million** for standby letters of credit at March 31, 2025[201](index=201&type=chunk) [Off-Balance Sheet Arrangements](index=66&type=section&id=Off-Balance%20Sheet%20Arrangements) The Company did not engage in any off-balance sheet transactions during Q1 2025 that are reasonably likely to have a material adverse effect on its financial condition, results of operations, or cash flows - No material adverse off-balance sheet arrangements were engaged in during the three months ended March 31, 2025[205](index=205&type=chunk) [Impact of Inflation and Changing Prices](index=66&type=section&id=Impact%20of%20Inflation%20and%20Changing%20Prices) The Company's financial statements are prepared using historical dollars, and while inflation impacts operating costs, changes in market interest rates have a greater effect on its performance - The primary impact of inflation is reflected in increased operating costs[206](index=206&type=chunk) - Changes in market interest rates have a greater impact on the Company's performance than inflation, given its assets and liabilities are primarily monetary[206](index=206&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=66&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The Company actively manages interest rate risk, which is defined as exposure to earnings and capital from adverse interest rate movements, using income and economic value simulations to monitor and control this risk - Interest rate risk is managed by determining how interest rate movements affect net interest income and the market value of portfolio equity[209](index=209&type=chunk) - The Company uses income simulation (short-term net interest income) and economic value simulation (long-term market value of portfolio equity) to assess interest rate risk[210](index=210&type=chunk)[212](index=212&type=chunk) | Change in Interest Rates (Basis Points) | Twelve Month Net Interest Income (% of Change) | Estimated Net Portfolio Value (% of Change) | | :-------------------------------------- | :--------------------------------------------- | :------------------------------------------ | | +200 | 14.95% | 2.00% | | +100 | 7.61% | 1.16% | | 0 | — | — | | -100 | (8.42)% | (2.04)% | | -200 | (16.95)% | (4.86)% | [Item 4. Controls and Procedures](index=70&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the effectiveness of disclosure controls and procedures, concluding they were effective as of March 31, 2025, with no material changes in internal control over financial reporting - Disclosure controls and procedures were evaluated and deemed effective as of March 31, 2025[221](index=221&type=chunk) - No material changes in internal control over financial reporting occurred during the last fiscal quarter[222](index=222&type=chunk) PART II — OTHER INFORMATION [Item 1. Legal Proceedings](index=70&type=section&id=Item%201.%20Legal%20Proceedings) The Company is involved in various legal actions and claims in the normal course of business, which management believes will not have a material adverse impact on its financial condition - Legal actions and claims arising in the normal course of business are not expected to have a material adverse impact on the Company's financial condition[224](index=224&type=chunk) [Item 1A. Risk Factors](index=70&type=section&id=Item%201A.%20Risk%20Factors) The Company's risk factors have not materially changed from those disclosed in its Annual Report on Form 10-K for the year ended December 31, 2024 - Risk factors have not materially changed from those disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024[225](index=225&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=70&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The Company's Board of Directors authorized a stock repurchase program to acquire up to **1,509,218 shares** of common stock, with no shares repurchased during Q1 2025 - The Board authorized a stock repurchase program for up to **1,509,218 shares** of common stock[226](index=226&type=chunk) | Period | Total Number of Shares Purchased | Average Price Paid Per Share | Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs | | :-------------------- | :------------------------------- | :--------------------------- | :----------------------------------------------------------------------------- | | January 1 - 31, 2025 | - | - | 418,044 | | February 1 - 28, 2025 | - | - | 418,044 | | March 1 - 31, 2025 | - | - | 418,044 | | Total | - | - | | [Item 3. Defaults Upon Senior Securities](index=71&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This item is not applicable to the Company [Item 4. Mine Safety Disclosures](index=71&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the Company [Item 5. Other Information](index=71&type=section&id=Item%205.%20Other%20Information) No directors or officers informed the Company of the adoption or termination of Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during Q1 2025 - No directors or officers reported adoption or termination of Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the quarter[230](index=230&type=chunk) [Item 6. Exhibits](index=71&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including certifications, XBRL financial statements, and related taxonomy documents - Exhibits include CEO and CFO certifications (31.1, 31.2, 32.0), and XBRL formatted financial statements and taxonomy documents (101.0, 101.INS, 101.SCH, 101.CAL, 101.DEF, 101.LAB, 101.PRE, 104)[236](index=236&type=chunk)

Financial Performance - Net income for the three months ended March 31, 2025, was $10.6 million, or $0.80 per basic share, compared to $11.4 million, or $0.87 per basic share, for the same period in 2024, representing a decrease of 7.0% in net income [2]. - Basic earnings per share decreased to $0.80 in Q1 2025 from $0.87 in Q1 2024, while diluted earnings per share fell to $0.78 from $0.86 [49]. - Net interest income for the three months ended March 31, 2025, was $24.3 million, a decrease of $722,000, or 2.9%, from $25.0 million in the same period in 2024 [20]. - Net interest income for Q1 2025 was $24,264,000, down from $24,986,000 in Q1 2024, reflecting a decrease in net interest margin from 5.75% to 5.11% [49]. - The efficiency ratio increased to 41.64% in Q1 2025 compared to 37.91% in Q1 2024, indicating a decline in operational efficiency [49]. - Return on average total assets decreased to 2.12% in Q1 2025 from 2.50% in Q1 2024, while return on average shareholders' equity fell to 12.98% from 15.88% [49]. Asset and Loan Management - Total assets decreased by $76.2 million, or 3.8%, to $1.9 billion at March 31, 2025, primarily due to a decrease in net loans of $87.3 million [4]. - Loans, net of the allowance for credit losses, decreased by $87.3 million, or 4.8%, to $1.7 billion at March 31, 2025, with significant decreases in construction loans by $138.9 million [8]. - Total loans decreased to $1,725,601,000 in Q1 2025 from $1,812,598,000 in Q4 2024, with a notable decline in the construction loan portfolio from $1,426,167,000 to $1,287,225,000 [49]. - The allowance for credit losses related to loans increased to $5.1 million, or 0.30% of total loans, as of March 31, 2025, compared to $4.9 million, or 0.27% of total loans, at December 31, 2024 [9]. - The allowance for credit losses to total loans increased to 0.30% in Q1 2025 from 0.27% in Q4 2024, reflecting a cautious approach to credit risk management [49]. - Non-performing assets remained stable at $5.1 million as of March 31, 2025, with a ratio of non-performing assets to total assets at 0.26% [34]. - Total non-performing assets remained stable at $5,120,000 in both Q1 2025 and Q4 2024, indicating consistent asset quality [49]. Income and Expenses - Total interest and dividend income increased by $86,000, or 0.2%, to $38.2 million for the three months ended March 31, 2025, due to an increase in the average balance of interest-earning assets [21]. - Non-interest income for the three months ended March 31, 2025, was $1.2 million, an increase of $681,000, or 122.9%, compared to $554,000 for the same period in 2024 [29]. - Non-interest expense increased by $938,000, or 9.7%, to $10.6 million for the three months ended March 31, 2025, compared to $9.7 million for the same period in 2024 [32]. - Net interest income after provision for credit loss was $24.0 million for the three months ended March 31, 2025, down from $25.2 million for the same period in 2024 [47]. Equity and Capital Management - Total stockholders' equity increased by $8.9 million, or 2.8%, to $327.2 million at March 31, 2025, driven by net income and other factors [19]. - The total stockholders' equity to assets ratio was 16.92% as of March 31, 2025 [37]. - The company completed its first stock repurchase program, repurchasing 1,637,794 shares at a total cost of $23.0 million [39]. - As of March 31, 2025, the company had repurchased 1,091,174 shares under its second stock repurchase program at a cost of $17.2 million [40]. - Total capital to risk-weighted assets improved to 15.10% in Q1 2025 from 13.92% in Q4 2024, indicating stronger capital adequacy [49]. Taxation - The effective income tax rate decreased to 27.8% for the three months ended March 31, 2025, from 29.0% for the same period in 2024 [33].

Financial Performance - Northeast Community Bancorp (NECB) reported quarterly earnings of $0.78 per share, exceeding the Zacks Consensus Estimate of $0.77 per share, but down from $0.86 per share a year ago, representing an earnings surprise of 1.30% [1] - The company posted revenues of $25.5 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 0.04%, compared to revenues of $25.54 million in the same quarter last year [2] - Over the last four quarters, the company has surpassed consensus EPS estimates three times and topped consensus revenue estimates three times [2] Stock Performance - Northeast Community Bancorp shares have declined approximately 9.7% since the beginning of the year, while the S&P 500 has seen a decline of 10.2% [3] - The stock currently holds a Zacks Rank 1 (Strong Buy), indicating expectations for it to outperform the market in the near future [6] Future Outlook - The current consensus EPS estimate for the upcoming quarter is $0.79 on revenues of $26.26 million, and for the current fiscal year, it is $3.18 on revenues of $105.66 million [7] - The outlook for the industry, specifically the Banks - Northeast sector, is favorable, ranking in the top 23% of over 250 Zacks industries, suggesting that stocks in the top 50% outperform those in the bottom 50% by more than 2 to 1 [8]

Core Viewpoint - NorthEast Community Bancorp, Inc. reported a net income of $10.6 million for Q1 2025, a decrease from $11.4 million in Q1 2024, attributed to a challenging economic environment and changes in loan demand and interest income [1][2][20]. Financial Performance - Net income for Q1 2025 was $10.6 million, or $0.80 per basic share, compared to $11.4 million, or $0.87 per basic share in Q1 2024 [1][46]. - Net interest income decreased by $722,000, or 2.9%, to $24.3 million in Q1 2025 from $25.0 million in Q1 2024 [20][46]. - Total interest and dividend income increased slightly by $86,000, or 0.2%, to $38.2 million in Q1 2025 [21][46]. - Non-interest income rose significantly by $681,000, or 122.9%, to $1.2 million in Q1 2025, driven by unrealized gains on equity securities and increased loan fees [29][30]. Balance Sheet Highlights - Total assets decreased by $76.2 million, or 3.8%, to $1.9 billion as of March 31, 2025, primarily due to a reduction in net loans [3][44]. - Net loans decreased by $87.3 million, or 4.8%, to $1.7 billion, with notable declines in construction loans [7][44]. - Cash and cash equivalents increased by $11.2 million, or 14.3%, to $89.5 million, reflecting a decrease in loans and an increase in stockholders' equity [4][44]. Asset Quality and Credit Losses - The allowance for credit losses related to loans increased to $5.1 million, or 0.30% of total loans, from $4.8 million, or 0.27% of total loans [10][35]. - Non-performing assets remained stable at $5.1 million, with a ratio of non-performing assets to total assets at 0.26% [34][35]. Capital and Regulatory Ratios - Total stockholders' equity increased by $8.9 million, or 2.8%, to $327.2 million, representing 16.92% of total assets [18][37]. - The bank's capital position is strong, with a tier 1 leverage capital ratio of 15.09% and a total risk-based capital ratio of 15.10% as of March 31, 2025 [38][39]. Loan Portfolio and Originations - During Q1 2025, the company originated loans totaling $170.1 million, with a focus on construction and multi-family loans [8][46]. - The composition of the loan portfolio showed a decrease in construction loans but an increase in multi-family and commercial loans [7][46].

Core Insights - Three stocks with strong value characteristics and a buy rank are highlighted for investors to consider on March 31st Group 1: Kingstone Companies, Inc. (KINS) - Kingstone is a property and casualty insurance company with a Zacks Rank of 1 [1] - The Zacks Consensus Estimate for its current year earnings has increased by 22.6% over the last 60 days [1] - The company has a price-to-earnings ratio (P/E) of 8.94, significantly lower than the S&P 500's P/E of 20.18 [1] - Kingstone possesses a Value Score of A [1] Group 2: Forum Energy Technologies, Inc. (FET) - Forum designs, manufactures, and supplies products for the energy industry and also carries a Zacks Rank of 1 [2] - The Zacks Consensus Estimate for its current year earnings has increased by 17.7% over the last 60 days [2] - Forum has a P/E ratio of 10.15, which is comparable to the industry average of 10.20 [2] - The company possesses a Value Score of A [2] Group 3: Northeast Community Bancorp, Inc. (NECB) - Northeast Community Bancorp is the holding company for NorthEast Community Bank and holds a Zacks Rank of 1 [3] - The Zacks Consensus Estimate for its current year earnings has increased by 4.6% over the last 60 days [3] - The company has a P/E ratio of 7.36, which is lower than the industry average of 9.20 [3] - Northeast Community possesses a Value Score of B [3]

Core Viewpoint - Northeast Community Bancorp (NECB) has been upgraded to a Zacks Rank 2 (Buy), indicating an upward trend in earnings estimates which is a significant factor influencing stock prices [1][4]. Earnings Estimates and Ratings - The Zacks rating system is primarily based on a company's changing earnings picture, tracking the Zacks Consensus Estimate for EPS from sell-side analysts [2]. - The Zacks rating upgrade reflects a positive outlook on the earnings potential of Northeast Community Bancorp, which could positively affect its stock price [4][6]. Impact of Earnings Estimates on Stock Prices - Changes in a company's future earnings potential, as indicated by earnings estimate revisions, are strongly correlated with near-term stock price movements [5]. - Institutional investors often rely on earnings estimates to determine the fair value of a company's shares, leading to significant stock price movements based on their buying or selling activities [5]. Recent Performance of Northeast Community Bancorp - For the fiscal year ending December 2025, Northeast Community Bancorp is expected to earn $3.18 per share, reflecting a year-over-year decline of 11.2% [9]. - Over the past three months, the Zacks Consensus Estimate for the company has increased by 4.6%, indicating a positive trend in earnings estimates [9]. Zacks Rank System Overview - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 (Strong Buy) stocks historically generating an average annual return of +25% since 1988 [8]. - The upgrade of Northeast Community Bancorp to a 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 [11].

Core Points - NorthEast Community Bancorp, Inc. has declared a quarterly cash dividend of $0.20 per common share, payable on or about May 6, 2025, to shareholders of record as of April 7, 2025 [1][2] - The increase in the quarterly dividend reflects the company's long-term commitment to enhancing shareholder value, as stated by Kenneth A. Martinek, the Chairman and CEO [2] Company Overview - NorthEast Community Bancorp is headquartered in White Plains, New York, and serves as the holding company for NorthEast Community Bank, which operates eleven branch offices across New York and Massachusetts [2] - The bank has branch locations in Bronx, Orange, Rockland, and Sullivan Counties in New York, as well as Essex, Middlesex, and Norfolk Counties in Massachusetts, along with three loan production offices [2]