Financial Data and Key Metrics Changes - The company reported an EPS of $0.83 and net income of $32 million, with a return on assets (ROA) of 1.32% and a pre-provision net revenue (PPNR) of 1.73% [8][19] - Net interest income increased by $3.3 million, or 3.9%, compared to the first quarter, with a net interest margin (NIM) expansion to 3.88%, up seven basis points [14][18] - Total assets exceeded $9.8 billion, driven by a 5% increase in loans [6][8] Business Line Data and Key Metrics Changes - Annualized loan growth was just over 5%, amounting to $98 million in Q2, primarily driven by commercial real estate balances, which increased by $58 million [9][10] - The mortgage and home equity businesses contributed a combined net growth of $26 million [10] - Customer deposit growth was $28 million, or 1.42% annualized, with non-interest bearing deposits representing 28% of total deposits [11][12] Market Data and Key Metrics Changes - The company maintained a stable allowance for credit losses at 1.24% of total loans, with non-performing assets (NPAs) remaining low [12][39] - The competitive landscape varies geographically, with the company maintaining significant market share in its core markets while being a disruptor in Ohio [64] Company Strategy and Development Direction - The company is focused on organic growth, with a clear path to reach $10 billion in total assets through loan growth and strategic initiatives [6][19] - There is an ongoing emphasis on improving asset quality and maintaining a solid deposit mix, with a disciplined approach to potential inorganic growth opportunities [5][6] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about future loan growth, expecting to maintain a mid to high single-digit growth rate for the remainder of the year [25][50] - The company is actively monitoring the impact of economic changes and tariffs but has not seen significant adverse effects on growth [12][39] Other Important Information - The company added four new commercial bankers to enhance its commercial and industrial (C&I) lending efforts [10][53] - The tangible common equity (TCE) ratio increased by 18 basis points, positioning the company well for growth opportunities [18][19] Q&A Session Summary Question: What is the outlook for funding costs and loan growth? - Management indicated that successful deposit raising efforts could offset some pressure on margins, but growth might be slightly lower than the current NIM of 3.88% [23] Question: Can you clarify the potential upside in a higher for longer interest rate environment? - Management noted that benefits from repricing on loans and securities could yield a couple of basis points of upside, but it would not be significant [24] Question: What is the company's strategy regarding M&A? - Management confirmed that building long-term relationships is critical, and they are optimistic about participating in M&A as market uncertainty decreases [29] Question: How does the company view its credit quality and reserves? - Management aims to stabilize non-performing loans (NPLs) and maintain low charge-offs, with reserves currently at 1.24% of loans [39][42] Question: What is the expected impact of crossing the $10 billion asset threshold? - The Durbin hit is estimated between $6 million and $7 million annually, but the company has built infrastructure to manage this without significant additional expenses [43][56] Question: What are the primary drivers of loan growth in the second half of the year? - Management highlighted consistent growth across various business lines, particularly in commercial real estate and home equity, with a focus on maintaining strong pipelines [50][51]

Core Points - NorthEast Community Bancorp, Inc. reported a net income of $11.2 million for Q2 2025, a decrease from $12.8 million in Q2 2024, and a net income of $21.7 million for the first half of 2025, down from $24.2 million in the same period of 2024 [1][2] Financial Performance - For the three months ended June 30, 2025, net interest income was $25.1 million, down 4.4% from $26.2 million in Q2 2024 [25] - Total interest and dividend income decreased by $2.2 million, or 5.5%, to $38.0 million for Q2 2025 compared to $40.2 million for Q2 2024 [26] - Interest expense decreased by $1.1 million, or 7.5%, to $13.0 million for Q2 2025 from $14.0 million in Q2 2024 [27] - The net interest margin decreased by 44 basis points to 5.35% for Q2 2025 compared to 5.79% for Q2 2024 [28] Balance Sheet Summary - Total assets decreased by $35.7 million, or 1.8%, to $2.0 billion at June 30, 2025, primarily due to decreases in cash and cash equivalents, net loans, and real estate owned [3] - Cash and cash equivalents decreased by $18.9 million, or 24.1%, to $59.4 million at June 30, 2025 [4] - Total deposits decreased by $191.2 million, or 11.5%, to $1.5 billion at June 30, 2025 [17] Loan Portfolio - Loans, net of the allowance for credit losses, decreased by $14.9 million, or 0.8%, to $1.8 billion at June 30, 2025 [7] - The company originated loans totaling $462.7 million during the first half of 2025, primarily in construction and multi-family loans [10] Asset Quality - The allowance for credit losses related to loans decreased to $4.7 million, or 0.26% of total loans, as of June 30, 2025 [56] - Non-performing assets were $767,000 at June 30, 2025, significantly down from $5.1 million at December 31, 2024 [54][55] Stockholders' Equity - Total stockholders' equity increased by $18.3 million, or 5.8%, to $336.7 million at June 30, 2025 [24] - The company's total stockholders' equity to assets ratio was 17.06% as of June 30, 2025 [58] Non-Interest Income and Expenses - Non-interest income for Q2 2025 was $858,000, an increase of 17.4% from $731,000 in Q2 2024 [33] - Non-interest expense increased by $1.0 million, or 10.6%, to $10.5 million for Q2 2025 compared to $9.5 million for Q2 2024 [36]

Financial Performance - The company reported a net income of $29.0 million and diluted earnings per share (EPS) of $1.71 for Q2 2025, an increase from $25.8 million and $1.52 in Q1 2025 [1][21] - Adjusted net income for Q2 2025 was $29.4 million with an adjusted diluted EPS of $1.73, compared to $26.0 million and $1.53 in Q1 2025 [2][21] - The net interest income for Q2 2025 was $62.1 million, reflecting a $2.1 million increase or 14% annualized from Q1 2025 [5][21] Net Interest Income and Margin - The net interest margin (NIM) for Q2 2025 was 2.97%, with a tax-equivalent yield (TEY) of 3.46%, up from 2.95% and 3.42% in Q1 2025 [5][6] - The company anticipates continued margin expansion, guiding for a potential increase in Q3 NIM TEY by up to four basis points [6] Noninterest Income - Noninterest income for Q2 2025 was $22.1 million, up from $16.9 million in Q1 2025, driven by a 51% increase in capital markets revenue [8][10] - Wealth management revenue totaled $4.6 million, showing an 8% increase compared to Q2 2024 [8] Loan Growth - Total loans and leases held for investment grew by $102.6 million to $6.9 billion in Q2 2025, representing an 8% annualized growth rate [15] - The company expects gross loan growth in the range of 8% to 10% for the second half of the year [15] Deposit and Asset Quality - Total deposits slightly declined by $19.0 million or 1% annualized from Q1 2025, while average deposit balances increased by $72.0 million [17] - The nonperforming assets (NPAs) to total assets ratio was 0.46%, down seven basis points from the prior quarter, with NPAs totaling $42.7 million [19] Capital and Book Value - Tangible book value per share increased by $1.64 or 13% annualized during Q2 2025 [24] - The tangible common equity to tangible assets (TCE/TA) ratio improved by 22 basis points to 9.92% [25]

Financial Performance - Net income for Q2 2025 was $210 million, an increase of $32 million compared to Q1 2025 and Q2 2024[8] - Net interest income increased by $26 million to $632 million[8, 24] - Earnings per share (EPS) increased by $053 to $309[8] - Return on average tangible common equity (ROTCE) was 1326%[8] Balance Sheet - Loans held in portfolio grew by $931 million or 25%[8, 10] - Total deposits increased by $14 billion or 21%[10] - Tangible book value per share increased by $339 to $7541[8, 10] - Total assets reached $76065 million[8] Credit Quality - Non-performing loans (NPLs) decreased by $2 million to $312 million[8, 10] - NPL ratio improved to 082% compared to 084% in Q1 2025[8, 10] - Net charge-off (NCO) ratio was 045% compared to 053% in Q1 2025[8, 10] Capital Actions - The company repurchased $1120 million in common stock at an average price of $9854 per share[10, 44] - A new common stock repurchase program of up to $500 million was announced[10, 44]

Financial Performance Highlights - Net income for the first six months of 2025 reached a record of $384.6 million, an increase of $44.9 million or 13% compared to the same period in 2024[10] - Diluted earnings per share (EPS) for the first six months of 2025 were $5.47, up $0.26 or 5% from the same period in 2024[10] - Net interest income for the first six months of 2025 was $1.1 billion, an increase of $138.4 million or 15% compared to the same period in 2024[10] - Total assets reached $69.0 billion, an increase of $9.2 billion or 15% compared to June 2024[10, 16] - Total loans amounted to $51.0 billion, an increase of $6.3 billion or 14% compared to June 2024[10, 16] - Total deposits increased to $55.8 billion, an increase of $7.8 billion or 16% compared to June 2024[10, 16] Balance Sheet and Capital - Tangible book value per common share (non-GAAP) increased to $81.86 as of June 30, 2025[10, 14] - The investment portfolio totaled $8.7 billion as of June 30, 2025, representing 13% of total assets[41] Credit Quality - Non-performing loans totaled $189 million, comprising 0.37% of total loans as of June 30, 2025[16]

Financial Data and Key Metrics Changes - Earnings per share for the second quarter were reported at $0.35, with revenues increasing by 21% year-over-year and expenses rising by approximately 6% excluding charitable contributions [5][14] - Pre-provision net revenue (PPNR) increased by $44 million sequentially, marking a 60% growth since Q1 2024 [5][6] - Tax equivalent net interest income rose by 4% sequentially and 28% year-over-year, while noninterest income increased by 10% year-over-year [14][20] Business Line Data and Key Metrics Changes - Commercial loan growth achieved the full-year target of $3 billion by June 30, 2025, with strong backlogs in institutional and middle market segments [6][10] - Investment banking fees increased by 41% year-over-year, with the first half of 2025 being the second-best in the company's history [22] - Assets under management reached a record $64 billion, with commercial mortgage servicing balances also at record levels [9][24] Market Data and Key Metrics Changes - Average loans increased by $1.4 billion sequentially, with C&I loans growing by $1.7 billion and CRE loans by $500 million [16][18] - Average deposits declined by less than 1% from the previous quarter, but total deposits increased by 2% year-over-year [18][19] - Noninterest-bearing deposits accounted for 19% of total deposits, remaining stable compared to the first quarter [19] Company Strategy and Development Direction - The company is focused on maintaining low to mid-single-digit expense growth while investing significantly in frontline bankers and technology [11][29] - There is a commitment to increasing the number of frontline bankers and client advisers by approximately 10% this year [11][78] - The company is positioned to take advantage of market dislocations due to its strong capital position and ample liquidity [13][27] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding client sentiment, noting that many clients feel good about their business despite macro concerns [35][36] - The company anticipates a significant ramp-up in capital expenditures in the second half of the year, driven by favorable tax policies [40] - Credit metrics are stable to improving, with net charge-offs and criticized loans declining [25][48] Other Important Information - The company plans to revise its 2025 guidance upwards, expecting net interest income growth of 20% to 22% [27][28] - The CET1 ratio was reported at 11.7%, indicating a strong capital position relative to peers [27] - The company is actively managing its deposit costs, which are now below 2% [6][19] Q&A Session Summary Question: Client sentiment and eagerness to borrow - Management noted that clients are cautiously optimistic, with many feeling good about their business despite macroeconomic concerns [35][36] Question: NII and loan growth outlook - The company revised its NII growth guidance to 20% to 22%, driven by strong performance in the first half and healthy pipelines [44][45] Question: Deposit pricing strategy - Management indicated that they have room to manage deposit costs and are observing competitive pricing in the market [60][62] Question: Capital management and share repurchases - The company plans to resume modest share repurchases in Q3, with a more significant increase expected in Q4 [70][71] Question: Loan and deposit pricing competition - Management acknowledged increased competition in loan pricing but noted that their pricing has remained flat year-over-year [99][101]

Financial Data and Key Metrics Changes - Earnings per share for Q2 2025 were reported at $0.35, with revenues increasing by 21% year-over-year and expenses rising by approximately 6% excluding charitable contributions [4][13]. - Pre-provision net revenue (PPNR) increased by $44 million sequentially, marking a 60% growth since Q1 2024 [4][5]. - Tax equivalent net interest income rose by 4% sequentially and 28% year-over-year, while noninterest income increased by 10% year-over-year [13][19]. Business Line Data and Key Metrics Changes - Commercial loan growth achieved the full-year target of $3 billion by June 30, 2025, with strong backlogs in institutional and middle market segments [5][8]. - Investment banking fees increased by 41% year-over-year, with Q2 2025 being the second-best first half in the company's history [21]. - Assets under management reached a record $64 billion, with commercial mortgage servicing balances also at record levels [7][22]. Market Data and Key Metrics Changes - Average loans increased by $1.4 billion sequentially, with commercial and industrial (C&I) loans growing by $1.7 billion [15]. - Average deposits declined by less than 1% from the previous quarter, but total deposits increased by 2% year-over-year [16][17]. - Noninterest-bearing deposits accounted for 19% of total deposits, remaining stable compared to the first quarter [17]. Company Strategy and Development Direction - The company is focused on maintaining low to mid-single-digit expense growth while investing significantly in frontline bankers and technology [10][12]. - There is a commitment to increasing the number of frontline bankers and client advisers by approximately 10% this year [10][73]. - The company is optimistic about meeting or exceeding full-year financial targets due to strong client engagement and healthy pipelines [8][12]. Management's Comments on Operating Environment and Future Outlook - Management noted that clients are cautiously optimistic, with many seeing the current environment as an opportunity for growth despite macroeconomic concerns [34][36]. - The company is maintaining a strong capital position and ample liquidity, allowing it to take advantage of market dislocations [12][63]. - Future guidance for net interest income growth has been revised to 20% to 22%, reflecting strong first-half performance and encouraging pipelines [26][29]. Other Important Information - The company added $36 million to its loan loss reserves this quarter, with net charge-offs of $102 million [4][14]. - The CET1 ratio was reported at 11.7%, indicating a strong capital position among peers [25]. - The company plans to resume modest share repurchases in Q3 2025, with a more significant increase expected in Q4 [65]. Q&A Session Summary Question: Client sentiment and financial outlook - Management indicated that clients are cautiously optimistic, with many feeling good about their business despite macro concerns. This sentiment is expected to translate into higher net interest income and loan growth [32][34]. Question: Deposit pricing strategy - The company is managing deposit costs effectively, with a slight decline in interest-bearing deposit costs. There is flexibility due to a low loan-to-deposit ratio [56][58]. Question: Capital and share repurchase plans - The company is at the high end of its CET1 target and plans to resume share repurchases modestly in Q3, increasing in Q4 based on market opportunities [62][65]. Question: Loan growth guidance - The company expects average loans to be down 1% to 3% for the full year, with commercial loans projected to grow about 5% [28][111]. Question: Credit quality and reserve ratio - Credit metrics are stable to improving, and there is potential for reserve reductions if the economic environment continues to improve [101][103].

Key Metrics & Financial Performance - The industry is focused on net interest income (NII), which is the difference between what banks earn on loans and pay on deposits [1] - NII has been declining since early 2023, and a shift in this trend could significantly impact the industry [1] - Loan loss provisions and credit quality are also key areas of focus for the industry [1] Credit Quality & Risk - Credit losses, particularly in the commercial real estate sector, are a major concern for the industry [2] - Defaults in the commercial real estate sector have been increasing [2] Revenue Streams - Investment banking and trading revenue have been increasing over the past several quarters [2] - M&A activity, along with investment banking fees, will be closely monitored by the industry [2] Consumer Behavior - Despite high interest rates, consumer resilience remains strong [2] - Credit and debit card spending continues to increase, even with the initiation of tariffs [3] - A strong labor market may be contributing to continued consumer spending [3]

Financial Data and Key Metrics Changes - Earnings per common share were reported at $0.34, with EPS excluding notable items growing 27% year over year [14] - Average loan balances increased by $2.3 billion or 1.8% from the prior quarter, while average deposits rose by $1.8 billion or 1.1% [15][20] - Adjusted common equity tier one (CET1) was 9%, up 40 basis points from last year, and tangible book value per share increased 16% year over year [8][15] - Return on tangible common equity (ROTCE) was 16.1% for the quarter, adjusted ROTCE was 17.6% [14][15] Business Line Data and Key Metrics Changes - Average loans grew by almost $10 billion year over year, with significant contributions from commercial loans and new initiatives [7][17] - New initiatives accounted for approximately 40% of total loan growth, with $900 million in growth [17] - Fee income in strategic areas such as payments, wealth, and capital markets grew by 11% year over year [8][23] Market Data and Key Metrics Changes - The company reported strong deposit growth, with primary bank relationships increasing by 46% year over year in consumer and business banking [8] - The overall cost of deposits declined by one basis point, reflecting disciplined deposit pricing [20][52] Company Strategy and Development Direction - The company is focused on organic growth and has announced the acquisition of Veritex to accelerate growth in Texas [5][10] - The acquisition is expected to enhance commercial lending and capital markets opportunities, as well as expand the consumer franchise in Texas [12][13] - The company aims to maintain a moderate to low risk appetite while delivering strong performance [5] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the economic environment, noting improving sentiment and strong growth momentum [29] - The outlook for loan growth has been increased to 6% to 8%, and net interest income guidance has been raised to 8% to 9% for the full year [30][31] - Management remains focused on driving long-term shareholder value and believes the acquisition will contribute to future growth [36][109] Other Important Information - The company is maintaining a strong liquidity position with two times coverage of uninsured deposits [9] - Credit performance remains stable, with net charge-offs at 20 basis points and an allowance for credit losses at 1.86% [15][28] Q&A Session Summary Question: Concerns about net interest income guidance - Management indicated that they are on track to potentially hit the higher end of the net interest income guidance range, with economic stability being a key factor [42][43] Question: Feedback on the Veritex acquisition - Positive feedback was received from both internal and external partners, with excitement about the opportunities the acquisition presents [45][46][48] Question: Deposit trends and competition - Management noted strong deposit performance and expects continued solid growth, with stable deposit costs anticipated [50][52] Question: Changes in expense guidance - The increase in expense guidance is primarily due to higher incentive compensation linked to better revenue outlook [62][63] Question: Loan growth and competitive environment - Management acknowledged a slowdown in growth from new initiatives but remains optimistic about future contributions [65][66] Question: Outlook for North and South Carolina - The company continues to invest in these markets, with plans for new branch openings and hiring [72][73] Question: Capital levels and future distributions - Management is focused on maintaining a strong capital position and plans to begin regular capital distributions post-acquisition [108][109]

Financial Performance - Net income available to common shareholders was $534 million[3], with diluted earnings per share at $0.59[3] - Adjusted net income available to common shareholders reached $538 million[3], resulting in adjusted diluted earnings per share of $0.60[3] - Total revenue remained stable at $1,905 million[3] - Pre-Tax Pre-Provision Income was $832 million[3] - The efficiency ratio was 560%[3] - Return on Average Tangible Common Equity was 1934% on a reported basis and 1948% on an adjusted basis[3] Loan and Deposit Trends - Average loans remained stable, while ending loans grew by 1%[8] - Average deposits increased over 1%[22] - Pipelines are up 17% YoY and commitments are up 1%[8] Net Interest Income (NII) and Margin (NIM) - NII increased by 5% QoQ, and NIM increased 13bps to 365%[27] - Expect 2025 NII to grow between 3-5%[31] Non-Interest Income and Expense - Adjusted non-interest income increased 5%[36] to $646 million[33] - Non-interest expense increased 3%[40] to $1,073 million[38] - Expect FY25 adjusted non-interest income to grow between 25-35%[36]