Hanover Bancorp(US:HNVR)2025-11-07 21:00Financial Performance - For the three months ended September 30, 2025, the Company reported revenue of $18.0 million, an increase from $17.1 million in the same period of 2024, representing a growth of 5.6%[141] - Net income for the three months ended September 30, 2025, was $3.5 million, or $0.47 per diluted share, compared to $3.5 million, or $0.48 per diluted share for the same period in 2024, indicating a slight decrease in earnings per share[143] - The Company recorded net income of $7.5 million for the nine months ended September 30, 2025, a decrease of $0.9 million compared to $8.4 million in the same period of 2024[191] - Non-interest income decreased by $1.1 million for the nine months ended September 30, 2025, primarily due to a $1.8 million decrease in net gain on sale of loans held for sale[198] - Non-interest income for the three months ended September 30, 2025, totaled $2.785 million, down from $3.954 million in the same quarter of 2024[187] Operational Efficiency - The Company's efficiency ratio improved to 66.71% for the three months ended September 30, 2025, down from 71.75% in the same quarter of 2024, reflecting better operational efficiency[147] - The net interest margin improved to 2.74% for the three months ended September 30, 2025, compared to 2.37% in the same quarter of 2024, driven by a decrease in the cost of interest-bearing liabilities to 3.89%[179] - Total non-interest expense increased by $5.9 million for the nine months ended September 30, 2025, driven by a $2.1 million increase in salaries and employee benefits and one-time core system conversion expenses of $3.2 million[199] Asset and Loan Management - Total assets remained stable at $2.3 billion as of September 30, 2025, consistent with the total assets reported at December 31, 2024[149] - The Company sold $21.4 million in residential loans under its flow origination program during the quarter ended September 30, 2025, compared to $16.5 million in the same quarter of 2024, marking a 29.5% increase[138] - As of September 30, 2025, the residential loan portfolio was $751.5 million, representing 37.8% of total loans[150] - Total loans with credit risk ratings of Special Mention and Substandard rose to $66.4 million at September 30, 2025, up from $40.8 million at December 31, 2024[202] Credit Quality and Losses - Total non-accrual loans increased to $17.2 million, or 0.86% of total loans, as of September 30, 2025, up from $15.4 million, or 0.77% of total loans, in the same period of 2024[146] - The allowance for credit losses as a percentage of total non-accrual loans was 130% as of September 30, 2025, down from 152% a year earlier, indicating a tightening of credit standards[146] - The provision for credit losses on loans was $1.4 million for the three months ended September 30, 2025, compared to $0.2 million in the same quarter of 2024, with net charge-offs of $0.6 million during the quarter[183] - The allowance for credit losses amounted to $22.4 million or 1.12% of total loans outstanding at September 30, 2025, compared to 1.15% at December 31, 2024[203] Capital and Liquidity - As of September 30, 2025, the Bank had total stockholders' equity of $201.8 million, up from $196.6 million at December 31, 2024, with retained earnings increasing by $5.2 million due to net income of $7.5 million for the nine months ended September 30, 2025[167] - The Bank's tier 1 leverage ratio was 9.15%, and the common equity tier 1 risk-based capital ratio was 13.13% as of September 30, 2025, exceeding all regulatory guidelines for a well-capitalized institution[169] - Total borrowings were $100.7 million as of September 30, 2025, down from $107.8 million at December 31, 2024[152] - The company had undrawn liquidity sources totaling $712.2 million, approximately 253% of uninsured deposit balances[162] Market Presence and Strategic Initiatives - The Company opened a new full-service branch in Port Jefferson, New York, in June 2025, expanding its market presence in the Suffolk County area[134] - The Company completed its core processing system conversion to FIS Horizon in February 2025, enhancing its technological capabilities[132] - The Company was added to the Russell 2000 Index in late June 2025, which may enhance its visibility and attractiveness to investors[133] Deposits and Funding - Total deposits remained stable at $2.0 billion as of September 30, 2025, with a loan to deposit ratio of 101%[151] - Core deposit balances accounted for 71.5% of total deposits at September 30, 2025, down from 74.5% at December 31, 2024[151] - The municipal deposit program totaled $513.6 million, or 26.0% of total deposits, as of September 30, 2025[151] - At September 30, 2025, the aggregate amount of outstanding uninsured deposits was $281.9 million, or 14.3% of total deposits[151] Shareholder Returns - The Company declared a cash dividend of $0.10 per share on both common and Series A preferred shares, payable on November 20, 2025[174] - The Company repurchased 25,264 shares of its common stock at an aggregate cost of $546 thousand during the nine months ended September 30, 2025, with remaining buyback authority of 340,786 shares[170]