Dime(US:DCOM)2025-10-23 13:02Financial Data and Key Metrics Changes - Core pre-tax, pre-provision income for Q3 2025 was $54.4 million, up from $49.4 million in Q2 2025 and $29.8 million year-over-year [3][4] - Core EPS for Q3 was $0.61, representing a 110% year-over-year increase [10] - Reported NIM increased to 3.01%, with a significant increase in the spread between loans and deposits following the Fed rate cut [10][5] Business Line Data and Key Metrics Changes - Business loans grew over $160 million in Q3, compared to $110 million in Q2, with year-over-year growth exceeding $400 million [7] - Loan originations, including new lines of credit, increased to $535 million, with a weighted average rate of approximately 6.95% [7] - Core deposits increased by $1 billion year-over-year, with total deposits up approximately $320 million from the prior quarter [4][10] Market Data and Key Metrics Changes - Non-performing assets (NPAs) were up slightly but represented only 50 basis points of total assets, which is favorable compared to peers [4] - The company maintained a strong liquidity position with a core deposit-funded balance sheet [4] Company Strategy and Development Direction - The company is focused on organic growth, particularly in business loans and core deposits, while managing its commercial real estate concentration ratio [8][38] - New branch openings in Manhattan and New Jersey are part of the strategy to expand market presence [8] - The company aims for NIM expansion in the fourth quarter and significant opportunities in 2026 based on loan repricing [8][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the credit quality and expects resolution of legacy NPAs in Q4 [22] - The company anticipates a gradual improvement in NIM due to reduced deposit costs and stable loan yields [12][13] - Management believes the industry is in the later innings of the credit cycle, with a strong local economy and no significant stress expected [49] Other Important Information - Non-interest income for the quarter was $12.2 million, including a $1.5 million fraud recovery [11][46] - The common equity tier 1 ratio grew to over 11.5%, and total capital ratio increased to over 16% [11][12] Q&A Session Summary Question: Inquiry about charge-offs related to non-performing loans - Management clarified that charge-offs were primarily related to owner-occupied and non-owner-occupied commercial real estate, with no multifamily loans involved [21][22] Question: Expectations on multifamily payoffs and future prepayments - Management indicated that while there were significant payoffs this quarter, future prepayments are expected to normalize [24] Question: Discussion on normalized charge-offs and future expectations - Management stated that charge-offs are currently at 31 basis points and expect to return to historical levels as new businesses are built out [30][31] Question: Insights on deposit betas with potential rate cuts - Management noted that gradual rate cuts would help maintain deposit costs, with current costs in the low 190s [34][35] Question: Thoughts on M&A and strategic alternatives - Management emphasized a focus on organic growth and deploying excess liquidity rather than pursuing M&A at this time [38][45] Question: Discussion on stock repurchases given capital ratios - Management confirmed that discussions on stock repurchases have begun, with a focus on deploying capital effectively before considering buybacks [44][45]