Amalgamated Financial (US:AMAL)2023-05-08 16:00Financial Performance - Net income for Q1 2023 was $21.3 million, or $0.69 per diluted share, compared to $14.2 million, or $0.45 per diluted share in Q1 2022, reflecting a $7.1 million increase[189]. - Net interest income for Q1 2023 was $67.3 million, an increase of $18.9 million from $48.4 million in Q1 2022, driven by higher yields and average balances on interest-earning assets[193]. - Non-interest income decreased to $5.2 million in Q1 2023 from $7.4 million in Q1 2022, primarily due to a $3.1 million loss on the sale of securities[204]. - Provision for income tax expense for Q1 2023 was $7.6 million, compared to $4.9 million in Q1 2022, with an effective tax rate of 26.2% versus 25.8% in the prior year[210]. - Non-interest expense for Q1 2023 was $38.6 million, an increase of $4.2 million (12.2%) from Q1 2022, primarily due to a $4.3 million rise in compensation and benefits expense[209]. Asset and Liability Management - As of March 31, 2023, total assets were $7.84 billion, total loans were $4.13 billion, total deposits were $7.04 billion, and stockholders' equity was $519.2 million[175]. - Total assets remained stable at $7.84 billion as of March 31, 2023, with a $69.9 million increase in loans receivable and a $67.4 million increase in cash[211]. - Total liabilities increased to $7.32 billion in Q1 2023 from $6.83 billion in Q1 2022[202]. - Total deposits reached $6.90 billion in Q1 2023, compared to $6.64 billion in Q1 2022, reflecting growth in interest-bearing and non-interest-bearing deposits[197]. - Total estimated uninsured deposits were $4.38 billion at March 31, 2023, down from $4.52 billion at December 31, 2022[258]. Loan Portfolio - Total loans, net of deferred origination fees and allowance for credit losses, increased to $4.13 billion as of March 31, 2023, up from $4.06 billion as of December 31, 2022[228]. - The commercial loan portfolio comprised 56.0% of the total loan portfolio as of March 31, 2023, compared to 55.2% as of December 31, 2022[231]. - Multifamily loans increased by 9.9% to $1.06 billion, accounting for 25.3% of the total loan portfolio as of March 31, 2023[232]. - The residential real estate lending portfolio totaled $1.39 billion, representing 75.3% of the retail loan portfolio and 33.1% of the total loan portfolio, with a 1.3% increase from $1.37 billion at December 31, 2022[235]. - The total loans outstanding as of March 31, 2023, were $4.20 billion, with $998.8 million maturing within five years and $1.83 billion maturing after 15 years[240]. Credit Quality - The provision for credit losses was $5.0 million in Q1 2023, compared to $2.3 million in Q1 2022, driven by a $1.2 million impairment charge on a Silicon Valley Bank senior note[199]. - The allowance for credit losses increased by $22.3 million to $67.3 million at March 31, 2023, from $45.0 million at December 31, 2022, with a ratio of allowance to total loans at 1.61%[244]. - Nonperforming assets totaled $38.7 million, or 0.49% of total assets at March 31, 2023, an increase of $10.1 million from $28.6 million, or 0.44% at December 31, 2022[251]. - Potential problem loans amounted to $101.8 million, or 1.2% of total assets at March 31, 2023, with $99.4 million being commercial loans in workout[252]. - The total allowance for credit losses was allocated as follows: $26.3 million for the commercial portfolio and $41.0 million for the retail portfolio[247]. Investment Portfolio - The total securities portfolio was valued at $3.26 billion as of March 31, 2023, down from $3.35 billion at the end of 2022[221]. - The securities portfolio primarily consists of high-quality investments, with approximately 83% carrying AAA credit ratings[227]. - The company aims to manage interest rate risk and maintain liquidity through its investment securities portfolio[212]. - The investment committee, led by the CFO, oversees the securities portfolio in accordance with policies approved by the Board of Directors[212]. - Approximately 50% of the securities portfolio is classified as "available for sale"[227]. Liquidity and Capital Management - The company maintains sufficient liquidity to meet capital and debt service obligations for 12 months under adverse conditions without support from subsidiaries[265]. - As of March 31, 2023, the company had a total liquidity of $2.7 billion, covering 62% of total uninsured deposits[270]. - The company has a borrowing capacity of approximately $368.1 million with the Federal Reserve's discount window, secured by certain unpledged securities[270]. - The company maintained a total capital to risk-weighted assets ratio of 15.00% and a Tier 1 capital to risk-weighted assets ratio of 12.23% as of March 31, 2023[276]. - The company did not elect to utilize the optional three-year phase-in period for the Day 1 adverse regulatory capital effects upon adopting the CECL standard[272].