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 slight adjustment to 2.98% when excluding prepayment fees and purchase accounting [10][12] - Total deposits increased by approximately $320 million from the previous quarter [10] 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, reached $535 million, with a weighted average rate of approximately 6.95% [7] - Core deposits increased by $1 billion year-over-year, with a strong focus on growing the deposit portfolio [4] 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 credit side loans declined by approximately $30 million linked quarter, and loans 30 to 89 days past due decreased by 33% [11] 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 significant NIM expansion in 2026 based on loan repricing opportunities and organic growth [14][38] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the credit quality and expects to resolve legacy NPAs in the fourth quarter [22] - The company anticipates a relatively flat balance sheet for the remainder of the year, with growth in business loans expected [15] - Management believes the industry is in the later innings of the current credit cycle, with a strong local economy supporting stability [49] Other Important Information - Non-interest income for the quarter was $12.2 million, including a $1.5 million recovery from a past fraud case [11][47] - The common equity tier 1 ratio grew to over 11.5%, and the total capital ratio increased to over 16% [11] Q&A Session Summary Question: Inquiry about charge-offs related to NPAs - 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 in the context of new business verticals - Management stated that the guidance for charge-offs was around 20-30 basis points, with current levels at 31 basis points, and expects to return to historical levels over the next couple of quarters [30][31] Question: Thoughts on deposit betas amid potential rate cuts - Management expressed optimism about maintaining deposit costs and passing on rate cuts effectively, with current deposit costs in the low 190s [34][35] Question: Strategic alternatives including M&A considerations - Management emphasized a focus on organic growth and deploying excess liquidity rather than pursuing M&A at this time [38][45]