Amalgamated Financial (US:AMAL)2021-11-08 16:00Financial Performance - Net income for Q3 2021 was $14.4 million, or $0.46 per diluted share, compared to $12.5 million, or $0.40 per diluted share in Q3 2020[184]. - For the nine months ended September 30, 2021, net income was $37.0 million, or $1.17 per diluted share, compared to $32.4 million, or $1.04 per diluted share for the same period in 2020[184]. - Non-interest income was $6.7 million for the third quarter of 2021, a decrease of $6.1 million from $12.8 million in the same quarter of 2020[203]. - Total non-interest expense for the nine months ended September 30, 2021, was $97.2 million, a decrease of $4.0 million from $101.2 million for the same period in 2020[210]. - Non-interest expense for the third quarter of 2021 was $33.0 million, a decrease of $4.9 million from the third quarter of 2020[209]. Asset and Liability Overview - As of September 30, 2021, total assets were $6.9 billion, total loans were $3.1 billion, total deposits were $6.2 billion, and stockholders' equity was $556.4 million[166]. - Total assets were $6.9 billion at September 30, 2021, an increase of $0.9 billion from $6.0 billion at December 31, 2020[213]. - Total deposits increased to $6.2 billion as of September 30, 2021, up from $5.3 billion at December 31, 2020, reflecting a growth of approximately 17%[257]. - Cash and equivalents reached $690.2 million, or 10.1% of total assets, as of September 30, 2021, compared to $38.8 million, or 0.6% of total assets, at December 31, 2020[268]. - The deferred tax asset, net of deferred tax liabilities, was $24.7 million at September 30, 2021, down from $27.9 million at December 31, 2020[256]. Loan Portfolio - Total loans as of September 30, 2021, were $3.1 billion, a decrease from $3.4 billion as of December 31, 2020[224]. - The commercial loan portfolio comprised 58.9% of total loans as of September 30, 2021, down from 59.0% at December 31, 2020[227]. - C&I loans totaled $628.4 million, representing 20.2% of the total loan portfolio, a decrease of 7.2% from $677.2 million at December 31, 2020[227]. - Multifamily loans amounted to $826.1 million, accounting for 26.5% of total loans, down 12.8% from $947.2 million at December 31, 2020[229]. - Residential real estate lending loans were $1.0 billion, comprising 33.1% of total loans, down 16.6% from $1.2 billion at December 31, 2020[231]. Provision for Loan Losses - The company experienced a $3.9 million recovery of provision for loan loss in 2021 compared to a $20.2 million provision for loan loss in the same period of 2020[184]. - The provision for loan losses totaled a release of $3.9 million for the nine months ended September 30, 2021, compared to an expense of $20.2 million for the same period in 2020[199]. - The allowance for loan losses was $(35.9) million as of September 30, 2021, compared to $(41.6) million at December 31, 2020[226]. - The allowance for loan losses decreased by $5.7 million to $35.9 million as of September 30, 2021, from $41.6 million at December 31, 2020, primarily due to decreases in loan balances[243]. - Nonperforming assets totaled $67.8 million, or 0.99% of total assets, as of September 30, 2021, a decrease of $14.4 million from $82.2 million, or 1.38% of total assets, at December 31, 2020[251]. Investment Securities - As of September 30, 2021, the available for sale securities amounted to $2.0 billion, an increase of $415.6 million from $1.5 billion at December 31, 2020, primarily due to the purchase of asset-backed securities (ABS)[216]. - The total investment securities portfolio was $2.68 billion as of September 30, 2021, compared to $2.03 billion at December 31, 2020, reflecting an increase of approximately 31.7%[220]. - The ABS represented 35.4% of the available for sale securities portfolio as of September 30, 2021, up from 29.3% at December 31, 2020[220]. - The company does not intend to sell securities with unrealized losses and anticipates full recovery of amortized cost by maturity[217]. - The investment strategy focuses on minimizing credit risk through diversification and concentration limits, with significant investments in U.S. Government sponsored entity obligations[215]. Capital and Liquidity - The company is subject to Basel III capital requirements, which necessitate maintaining a capital conservation buffer of 2.5% on top of minimum risk-based capital requirements[271]. - As of September 30, 2021, the Company reported total capital to risk-weighted assets at $557,007 thousand, representing a ratio of 14.99%[274]. - The Tier I capital to risk-weighted assets was $519,645 thousand, with a ratio of 13.98% as of September 30, 2021[274]. - The liquidity position is supported by liquid assets and access to alternative funding sources, ensuring the ability to meet current and future liquidity needs[267]. - The simulation analysis indicated that a 400 basis points increase in interest rates could lead to a 14.0% increase in the economic value of equity, equating to $145.5 million[265].