Columbia Financial Unveils $597M Northfield Bancorp Merger, Second-Step Conversion Plan for 2026

Core Viewpoint - Columbia Financial and Northfield Bancorp have announced a merger valued at approximately $597 million, which will create the third-largest regional bank headquartered in New Jersey with pro forma total assets of about $18 billion and over 100 branches across 14 New Jersey counties, Brooklyn, and Staten Island [1][3][4]. Deal Structure & Timing - The merger consideration will be paid in stock or cash, with cash available for up to 30% of outstanding Northfield shares, and the per-share merger consideration is expected to range from $14.25 to $14.65 based on Columbia's final valuation appraisal [2][7]. - The merger and the second-step conversion to a fully public stockholding company are targeted to close in early Q3 2026, pending regulatory and shareholder approvals [3][7]. Financial Outlook - Management anticipates about 50% earnings accretion in 2027, with tangible book dilution of approximately 4.4% and an earnback period of about 1.8 years [5][12]. - The transaction is characterized as low risk due to conservative credit profiles, with a credit mark of $81 million, representing 2.1% of loans [5][19]. Strategic Footprint - The merger will add roughly $1.8 billion in deposits and enhance Columbia's market presence in densely populated and economically diverse areas like Brooklyn and Staten Island, reducing reliance on long-term, fixed-rate residential mortgages [6][8]. Leadership and Governance - Post-merger, Thomas Kemly will continue as President and CEO, with Dennis Gibney as Senior Executive Vice President and Chief Banking Officer, and Steve Klein joining as Senior Executive Vice President and Chief Operating Officer [9]. Credit Profile and Due Diligence - The due diligence process involved over 70 participants and extensive reviews of commercial loan files, with stress testing revealing 11 loans with a collateral shortfall totaling $2.7 million [18]. - Northfield's rent-regulated multifamily exposure totals $419 million, characterized by a diverse portfolio and historically low levels of non-performing assets [17][20].