Dime(DCOM) - 2025 Q1 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Core deposits increased by $1.3 billion year-over-year [5] - Cost of deposits reduced to 2.09% in the first quarter [6] - Net Interest Margin (NIM) increased to 2.9%, marking the fourth consecutive quarter of growth [6][13] - Adjusted EPS was $0.57, representing a 36% linked quarter increase and a 50% year-over-year increase [13] Business Line Data and Key Metrics Changes - Business loans grew by over $60 million in the first quarter and over $400 million year-over-year [7] - Loan pipeline currently stands at approximately $1.1 billion with an average yield of 7.22% [8] - Core pre-tax provision income was $46 million in the first quarter compared to $28 million a year ago [9] Market Data and Key Metrics Changes - Non-brokered deposits increased by approximately $65 million at March 31 versus year-end levels [14] - Excluding title company deposits, non-brokered deposits grew by approximately $250 million this quarter [14] Company Strategy and Development Direction - The company plans to expand into the Lakewood, New Jersey marketplace [11] - Focus on growing business loans while reducing commercial real estate (CRE) concentration [7] - Hiring efforts are aimed at enhancing both sides of the balance sheet [10] Management's Comments on Operating Environment and Future Outlook - Management remains bullish on continued NIM improvement despite uncertain rate environment [6] - Expectation of margin expansion in the second half of 2025 due to significant back book loan repricing opportunities [17][18] - Anticipated loan growth to pick up in the latter half of 2025 [19] Other Important Information - Core cash operating expenses for the first quarter were $57.9 million, excluding intangible amortization [15] - Common equity Tier one ratio increased to 11.1% and total capital ratio grew to 15.7% [16] Q&A Session Summary Question: Inquiry about loan pipeline mix - The loan pipeline consists of approximately $350 million in commercial and industrial (C&I), $185 million in owner-occupied CRE, and $250 million in healthcare [25] Question: Update on deposit growth and costs - The cost of deposits is around $2.10, with a healthy mix of demand deposits [26] Question: Credit reserve build guidance - The medium to long-term target for reserves is between 90 basis points to 1% [32] Question: Cash balance and margin opportunities - The company is managing its balance sheet for the medium to long term, with plans to utilize cash as loan growth picks up [35] Question: Non-owner occupied commercial real estate uptick - The uptick was due to one specific credit exit, with no systemic issues expected [41] Question: Competition and pricing in the region - The pricing environment is rational, with some competitors moderating their deposit pricing [68] Question: Fee income guidance for the year - The fee income guidance remains at $40 million to $42 million for the full year [83]