Dime(US:DCOM)2023-11-01 16:00Financial Performance - The company reported a net income of $13.163 million for the three months ended September 30, 2023, compared to $37.659 million for the same period in 2022, reflecting a decrease of approximately 65.0%[38] - Basic earnings per share (EPS) for the three months ended September 30, 2023, was $0.34, down from $0.98 in the same period of 2022, representing a decline of 65.3%[38] - The effective tax rate for the three months ended September 30, 2023, was 35.1%, up from 28.1% in the same period of 2022, primarily due to non-deductible severance expenses[132] - Net income for the three months ended September 30, 2023, was $15.0 million, a decrease from $39.5 million for the same period in 2022[202] - Net income for the nine months ended September 30, 2023, was $79.8 million, down from $112.5 million in the same period of 2022[218] Earnings and Dividends - Reported diluted EPS for Q3 2023 was $0.34, down from $0.98 in Q3 2022, while year-to-date EPS decreased to $1.92 from $2.74[136] - Cash dividends paid per common share increased to $0.25 in Q3 2023 from $0.24 in Q3 2022, with a year-to-date total of $0.74 compared to $0.72[136] - The Company expects to pay dividends on its preferred stock at a fixed rate of 5.50% per annum, payable quarterly, starting February 15, 2023[42] Asset and Loan Performance - Total loans held for investment, net increased to $10,778,048 thousand as of September 30, 2023, up from $10,483,324 thousand at December 31, 2022, representing a growth of 2.8%[53] - The total loans portfolio as of September 30, 2023, was $10,844,344, with a pass rate of 92.5%[71] - Total past due loans amounted to $58,331 thousand as of September 30, 2023, compared to $58,496 thousand at December 31, 2022, indicating a slight improvement[57] - Non-performing loans stood at $23.32 million as of September 30, 2023, down from $41.08 million a year earlier, reflecting improved asset quality[136] - The total allowance for credit losses decreased to $72.6 million at September 30, 2023, from $81.9 million at December 31, 2022, representing 0.67% of total loans[196] Interest Income and Expense - Net interest income for the three months ended September 30, 2023, was $76.5 million, a decrease of $23.9 million from $100.4 million in the same period of 2022[209] - Interest income rose to $157.8 million, an increase of $43.3 million compared to $114.5 million in the same quarter of 2022[210] - Interest expense surged to $81.4 million, up $67.3 million from $14.1 million in the same period last year[212] - Net interest margin decreased to 2.34% from 3.38% in the prior year[209] Securities and Investments - As of September 30, 2023, total securities available-for-sale amounted to $1,007.67 million, with a fair value of $869.88 million, reflecting unrealized losses of $137.81 million[43] - The total carrying amount of securities held-to-maturity was $600.29 million, with a fair value of $495.99 million, indicating unrealized losses of $104.31 million[43] - The company did not record any allowance for credit losses on its available-for-sale or held-to-maturity portfolios as of September 30, 2023, due to the high-quality composition of the securities[48] Deposits and Borrowings - Total deposits increased by $382.1 million during the nine months ended September 30, 2023, compared to an increase of $29.7 million for the same period in 2022[158] - The Bank had an additional unused borrowing capacity of $1.49 billion through the FHLBNY as of September 30, 2023[160] - The Bank's borrowings from FHLBNY Advances totaled $1.12 billion as of September 30, 2023, with an additional borrowing capacity of $4.09 billion[109] Credit Quality and Risk Management - The allowance for credit losses to total loans ratio was 0.67% as of September 30, 2023, down from 0.81% a year prior, indicating a reduction in expected credit losses[136] - The company categorizes loans into risk categories based on borrowers' ability to service their debt, which includes special mention, substandard, and doubtful classifications[67][69] - The company applies loan refinancing and restructuring guidance to determine the impact of modifications on existing loans, enhancing its credit risk assessment[60] Operational Efficiency - The efficiency ratio increased to 70.5% in Q3 2023 from 44.0% in Q3 2022, suggesting higher operational costs relative to income[136] - Non-interest expense increased to $59.5 million, up $11.2 million from $48.3 million in the same quarter of 2022[216] Regulatory Compliance - The Company and the Bank were in compliance with all applicable regulatory capital requirements as of September 30, 2023, with the Bank considered "well capitalized" for regulatory purposes[165]