Kearny Financial(US:KRNY)2022-05-06 15:56Financial Position - Total assets increased by $106.2 million to $7.39 billion at March 31, 2022, from $7.28 billion at June 30, 2021[138]. - Net loans receivable increased by $166.1 million, or 3.5%, to $4.96 billion at March 31, 2022, from $4.79 billion at June 30, 2021[141]. - Total deposits increased by $43.4 million, or 0.8%, to $5.53 billion at March 31, 2022, from $5.49 billion at June 30, 2021[152]. - The balance of borrowings increased by $165.3 million to $851.2 million at March 31, 2022, from $685.9 million at June 30, 2021[153]. - The aggregate balance of other assets increased by $26.3 million to $717.4 million at March 31, 2022, from $691.2 million at June 30, 2021[150]. - Stockholders' equity decreased by $87.8 million to $955.2 million as of March 31, 2022, from $1.04 billion at June 30, 2021, primarily due to share repurchases of $96.0 million and cash dividends of $23.0 million[155]. Credit Quality - The allowance for credit losses decreased by $14.3 million to $43.9 million, or 0.87% of total loans, at March 31, 2022, from $58.2 million, or 1.19% of total loans, at June 30, 2021[148]. - Nonperforming assets increased by $1.1 million to $81.0 million, or 1.10% of total assets, at March 31, 2022[145]. - The provision for credit losses reversed to $3.9 million for the quarter ended March 31, 2022, compared to a provision of $1.1 million for the same quarter in 2021, attributed to improved economic forecasts[168]. - Provision for credit losses reversed to $11.7 million for the nine months ended March 31, 2022, compared to a provision of $3.8 million in the prior year, reflecting an improvement in the economic forecast[189]. Income and Expenses - Net income for the quarter ended March 31, 2022, was $17.7 million, or $0.25 per diluted share, compared to $16.4 million, or $0.20 per diluted share for the same quarter in 2021, reflecting a decrease in the provision for credit losses[159]. - Net interest income decreased by $756,000 to $47.7 million for the quarter ended March 31, 2022, compared to $48.5 million for the same quarter in 2021, due to a $4.6 million decrease in interest income[161]. - Total non-interest income decreased by $1.4 million to $3.2 million for the quarter ended March 31, 2022, with a decrease in loan sale gains largely due to lower average sales prices and volume[171]. - Total non-interest expense increased by $807,000 to $30.6 million for the quarter ended March 31, 2022, driven by higher salaries and employee benefits[174]. - Net income for the nine months ended March 31, 2022, was $56.2 million, or $0.78 per diluted share, compared to $44.8 million, or $0.53 per diluted share for the same period in 2021, reflecting an increase in net interest income[180]. - Net interest income increased by $6.8 million to $146.0 million for the nine months ended March 31, 2022, compared to $139.2 million for the same period in 2021, due to a decrease in interest expense[182]. - Total non-interest income decreased by $6.4 million to $11.1 million for the nine months ended March 31, 2022, with a notable decrease in gain on sale of loans by $2.9 million to $2.4 million[190][192]. - Total non-interest expense decreased by $1.8 million to $92.1 million for the nine months ended March 31, 2022, despite an increase in salaries and employee benefits by $4.9 million[194]. Taxation - Provision for income taxes increased by $6.4 million to $20.6 million for the nine months ended March 31, 2022, reflecting a higher level of pre-tax net income[200]. - Effective tax rates rose to 26.8% for the nine months ended March 31, 2022, compared to 24.1% in the prior year[202]. Capital and Liquidity - Liquidity included $62.4 million of short-term cash and equivalents and $1.53 billion of investment securities classified as available for sale as of March 31, 2022[204]. - The company actively seeks to maintain its status as a well-capitalized institution in accordance with regulatory standards[208]. - As of March 31, 2022, the total capital to risk-weighted assets ratio was 14.14%, compared to 17.22% as of June 30, 2021[210]. - Tier 1 capital to risk-weighted assets ratio was 13.57% at March 31, 2022, down from 16.42% at June 30, 2021[210]. - Common equity tier 1 capital to risk-weighted assets ratio was 13.57% at March 31, 2022, compared to 16.42% at June 30, 2021[210]. - The total capital to risk-weighted assets ratio was 16.97% at March 31, 2022, down from 19.65% at June 30, 2021[210]. Interest Rate Risk - The company maintains an Asset/Liability Management (ALM) program to manage interest rate risk, overseen by the Board of Directors[215]. - Interest rate risk is a significant market risk for the company, affecting both earnings and capital[215]. - The company had $310 million in overnight borrowings as of March 31, 2022, compared to $20 million at June 30, 2021, indicating increased interest rate sensitivity[219]. - Economic Value of Equity (EVE) at March 31, 2022, was $1,293,258 thousand, with a sensitivity analysis showing a decrease of 11.91% under a +300 basis points scenario[219]. - Net Interest Income (NII) for the 1 to 12 months period at March 31, 2022, was projected at $204,792 thousand under a 0 basis points scenario[219]. - The company has adopted a five-year transition relief for the estimated impact of CECL on regulatory capital[210].