Dime Community Bancshares, Inc. Reports Earnings
Quarterly EPS of $0.34 Excluding $37.5 Million Gain on Real Estate Sale; Annualized Loan and Deposit Growth Exceeding 30% in Most Recent Quarter
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Dividend Yield: 5.6%
Revenue Growth %: -100.0%
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BROOKLYN, NY -- (Marketwired) -- 04/28/16 -- Dime Community Bancshares, Inc. (NASDAQ: DCOM) (the "Company" or "Dime"), the parent company of The Dime Savings Bank of Williamsburgh (the "bank"), today reported financial results for the quarter ended March 31, 2016. Consolidated net income was $50.0 million, or $1.36 per diluted share, for the quarter ended March 31, 2016, compared to $11.4 million, or $0.31 per diluted share, for the quarter ended December 31, 2015, and $11.8 million, or $0.33 per diluted share, for the quarter ended March 31, 2015.
During the quarter ended March 31, 2016, the Company recognized an after tax gain of $37.5 million, or $1.02 per diluted share on a consolidated basis, on the sale of Williamsburg real estate now serving as its back office operations center. Excluding this gain, the Company's net income was $12.6 million, or $0.34 per diluted share, during the March 2016 quarter.
In a separate transaction, on March 16, 2016, the bank announced that it contracted to sell its remaining Williamsburg owned-property, at a price of $12.3 million. That transaction is scheduled to close during the first quarter of 2017, and is expected to generate an after-tax gain between $5 million and $6 million. It is also the last remaining owned-property of significant value on the books of the bank.
Vincent F. Palagiano, Chairman and Chief Executive Officer of Dime, commented, "We began 2016 on a very successful note, generating $50 million of additional capital from both ongoing operations and the sale of real estate holdings. During the most recent quarter, excluding the impact of the real estate sale transaction, we achieved 10% growth in earnings per share from the previous quarter, and over 30% annualized growth in both loans and deposits." It also now appears that the bank will abandon its efforts to identify an income-producing property as a means to utilize the proceeds of the property sale (and defer taxes), as the economics of such a transaction were not deemed sufficiently compelling. "The decision not to enter into a 1031 exchange does not materially alter the expected future returns resulting from the sale of our existing property," noted Mr. Palagiano.
According to President and Chief Operating Officer Kenneth J. Mahon, the bank will seek to keep its headquarters in Brooklyn. "Dime is the largest bank headquartered in Brooklyn, having been founded in Williamsburg in 1864. Our Board has made the commitment to remain in the borough, where we employ approximately 200 people." The bank anticipates opening three new Brooklyn branches, where work is already underway, before the end of this year.
Management's Discussion of Quarterly Operating Results
- Net Interest Margin
Net Interest Margin ("NIM") was 2.80% during the quarter ended March 31, 2016, compared to 2.88% during the December 2015 quarter, and 2.80% during the March 2015 quarter. Income recognized from loan prepayment activity, which varies from quarter to quarter, had a positive impact on the Company's NIM during each of the reporting periods presented. For the first quarter 2016, income from prepayment activity totaled $2.6 million, benefiting NIM by twenty-two basis points, compared to $2.7 million, or twenty-three basis points, during the quarter ended December 31, 2015. During the most recent quarter, the average yield on interest earning assets declined by eight basis points (excluding prepayment income), while the average cost of funds declined by one basis point. "Core" NIM, which excludes the impact of prepayment income, was 2.58% during the March 2016 quarter, down from 2.65% in the December 2015 quarter, and 2.71% during the March 2015 quarter. The reductions resulted primarily from a lower average yield on earning assets.
The average yield on real estate loans, exclusive of the impact of prepayment income, declined six basis points during the most recent quarter, as the average interest rate on amortized/satisfied loans continued to exceed the interest rate on newly originated loans. The decline in average yield on real estate loans was the primary contributor to the eight basis point decline in the average yield on interest earnings assets (excluding prepayment income) during the most recent quarter.
The one basis point decline in the average cost of funds during the most recent quarter resulted primarily from an eleven basis point reduction in the average cost of borrowings.
- Net Interest Income
Net interest income was $34.6 million in the quarter ended March 31, 2016, $1.0 million above the $33.6 million reported in the December 2015 quarter, and $4.5 million above the $30.1 million reported in the March 2015 quarter. The additions from both the December 2015 and March 2015 quarters resulted from higher quarterly average interest earning assets, which, for the quarter ended March 31, 2016, exceeded the December 2015 quarter by $297.7 million and March 2015 quarter by $653.8 million. Also contributing to the growth in net interest income during the March 2016 quarter compared to the March 2015 quarter was $1.4 million of interest expense recognized in the March 2015 quarter from the prepayment of a Federal Home Loan Bank of New York advance.
- Provision/Allowance for Loan Losses
A loan loss credit (negative provision) of $21,000 was recorded during the most recent quarter, due primarily to both the beneficial impact of the rolling 4-year charge-off experience and net recoveries of $20,000 recognized during the period, which offset any provision required as a result of portfolio growth during the period.
- Non-Interest Income
Non-interest income was $69.7 million during the quarter ended March 31, 2016. Excluding the $68.2 million pre-tax gain on the sale of real estate recognized during the period, non-interest income was $1.5 million for the quarter ended March 31, 2016, a reduction of $225,000 from the December 2015 quarter, due primarily to lower administrative fees collected on portfolio loans in the March 2016 quarter. Excluding a $1.4 million gain on the sale of securities, non-interest income totaled $1.9 million during the March 2015 quarter.
- Non-Interest Expense
Non-interest expense was $17.9 million in the quarter ended March 31, 2016, up $1.7 million from the December 2015 quarter and $4.0 million from the March 2015 quarter, and approximately $400,000 above the $17.5 million projected level. The increase from the December 2015 quarter reflected $1.0 million of additional marketing expense from retail banking initiatives, an additional $225,000 of expense related to settlement of a bankruptcy claim, and $324,000 of additional salary and benefits expense from ongoing increases.
The increase above the $17.5 million forecast resulted primarily from a combination of the $225,000 bankruptcy claim expense (which was not forecasted), and higher FDIC insurance expense that reflected higher than forecasted asset growth.
The $4.0 million increase in non-interest expense from the March 2015 quarter primarily reflected a non-recurring $3.4 million reduction in expense recognized in the March 2015 quarter from the curtailment of post-retirement health benefits.
Non-interest expense was 1.38% of average assets during the most recent quarter, compared to 1.32% during the December 2015 quarter. The efficiency ratio approximated 49% during the March 2016 quarter.
- Income Tax Expense
The effective income tax rate approximated 42% during the March 2016 quarter, and will remain so throughout 2016, due primarily to this year's gain from sale of real estate.
Management's Discussion of the March 31, 2016 Balance Sheet
Total assets were $5.52 billion at March 31, 2016, up $493.4 million, or 9.8%, from December 31, 2015.
- Real Estate Loans
Real estate loan portfolio growth was $360.1 million on a net basis for the quarter. Real estate loan originations were $376.8 million, at a weighted average interest rate of 3.25%. Of this amount, $56.1 million represented loan refinances from the existing portfolio. Loan amortization and satisfactions totaled $169.4 million, or 13.9% (annualized) of the quarterly average portfolio balance, at an average rate of 3.78%. In addition, during the March 2016 quarter, the bank purchased $151.8 million of participations in well-secured New York City multifamily/mixed use real estate loans with an average yield approximating 3.23%. The average yield on the loan portfolio (excluding income recognized from prepayment activity) was 3.57% during the quarter ended March 31, 2016, compared to 3.63% during the December 2015 quarter, and 3.79% during the March 2015 quarter.
According to Mr. Mahon, "This is the second consecutive quarter in which the bank executed a bulk purchase of primarily New York City multifamily loans, which includes approximately $99 million in the 4th quarter of 2015. Dime is not in the business of purchasing loans; however, anticipating the significant infusion of new capital this quarter, management decided to leverage some of the capital with the purchase of 'typical Dime' quality loans. These loans are of relatively short duration, again typical of Dime's regular production." All purchased loans were re-underwritten using Dime's own underwriting standards.
- Credit Summary
Non-performing loans were $1.4 million, or 0.03% of total loans, at March 31, 2016, down slightly from December 31, 2015. Accruing loans delinquent between 30 and 89 days were $2.3 million, or 0.05% of total loans, at March 31, 2016, also down slightly from December 31, 2015. The allowance for loan losses was 0.37% of total loans at March 31 31, 2016, down from 0.39% at December 31, 2015. At March 31, 2016, non-performing assets represented 1.5% of the sum of tangible capital plus the allowance for loan losses (this statistic is otherwise known as the "Texas Ratio") (see table at the end of this news release). This number compares very favorably to both national and regional industry averages.
- Deposits and Borrowed Funds
Increasing deposit funding, especially core deposit funding, is viewed as a significant component of the Company's long term strategic growth plan. Deposits grew at a meaningful rate of 32% annualized during the March 2016 quarter, however, due to the bulk loan purchase occurring during the period, the loan-to-deposit ratio fell only slightly to 147% as of March 31, 2016.
Deposits increased by $255.4 million during the quarter ended March 31, 2016. Despite the recent Federal Open Market Committee increase in the target federal funds rate, the average cost of deposits increased only three basis points on a linked quarter basis. Recent deposit gathering initiatives focused upon money markets and certificates of deposit ("CDs") resulted in growth of $138.2 million and $122.2 million in their respective balances during the period. Checking and non-interest bearing accounts, a primary initiative for the bank, remained at 10% of total deposits during the most recent quarter.
Total borrowings increased $110.4 million during the March 2016 quarter, all of which was used to fund loan growth.
Borrowing was in the form of Federal Home Loan Bank of New York advances, and included $77.9 million of longer-term fixed rate borrowings, with a weighted average term to maturity of 3.6 years and a weighted average cost of 1.3%. Similar duration borrowings are likely to be employed periodically to help mitigate interest rate risk.
- Capital
The consolidated leverage ratio (Tier 1 capital to average assets) was 10.97% at March 31, 2016, well in excess of all Basel III capital requirements.
The bank's leverage capital ratio (Tier 1 capital to average assets) was 9.57% at March 31, 2016, up from 9.17% at December 31, 2015, as a result of the income generated from both ongoing operations and the real estate sale during the quarter. The bank's "Tier 1" and "Total" capital ratios (as a percentage of risk weighted assets) were 11.50% and 11.93%, respectively, at March 31, 2016, also in excess of the Basel III requirements (inclusive of conservation buffer amounts).
Reported diluted earnings per share, excluding the gain on the real estate sale, exceeded the quarterly cash dividend per share by 143% during the quarter ended March 31, 2016, equating to a 41% payout ratio. Additions to capital from ongoing operations and the real estate sale during the most recent quarterly period raised tangible book value per share by $1.22 sequentially, to $13.18 at March 31, 2016.
In closing, Mr. Palagiano stated that, "We are very pleased that through the sale of bank-owned property, we were able to add over one dollar of book value per share (about 8%), and to raise capital without diluting our shareholders. While there will be additional operating expenses resulting from our entry into leased headquarters, the expense increase will be partially offset by the earnings from the investment of cash from the sale. At the same time, I would like to thank our former president, Michael P. Devine, for shepherding this transaction through to a successful conclusion."
Outlook for the Quarter Ending June 30, 2016
At March 31, 2016, Dime had outstanding loan commitments totaling $265.0 million at an average interest rate approximating 3.42%, all of which are likely to close during the quarter ending June 30, 2016. Loan prepayments and amortization are expected to fall within the projected annualized range of 15% - 20% during the June 2016 quarter.
The Company has a balance sheet growth objective of 15% - 18% for the year ending December 31, 2016, with a preference toward utilizing retail deposits for most of its funding needs.
Despite the recent actions of the Federal Open Market Committee, deposit and borrowing funding costs are expected to remain near current historically low levels through the June 2016 quarter. At March 31, 2016, the bank had $89.4 million of CDs at an average rate of 0.84%, and $520.0 million of borrowings, at an average rate of 0.58%, scheduled to mature during the June 2016 quarter. No significant increase or reduction in funding costs is anticipated from the rollover or re-positioning of these funds.
During the remainder of 2016, the impact of the rolling 4-year charge-off experience is anticipated to be minor upon the provision for loan losses. As a result, quarterly loan loss provisions are likely to be impacted primarily by periodic loan portfolio growth.
Non‐interest expense is expected to approximate $17.5 million during the June 2016 quarter.
The Company projects that the consolidated effective tax rate will approximate 42.0% in the June 2016 quarter.
Recently Disclosed Pending Property Sale
The bank announced that it entered into an agreement to sell a real estate parcel in Williamsburg currently serving as its principal banking office. This transaction is expected to close during the second quarter of 2017. A nearby relocation of the branch office is expected to occur upon completion of the sale.
ABOUT DIME COMMUNITY BANCSHARES, INC.
The Company (NASDAQ: DCOM) had $5.52 billion in consolidated assets as of March 31, 2016, and is the parent company of the bank. The bank was founded in 1864, is headquartered in Brooklyn, New York, and currently has twenty-five branches located throughout Brooklyn, Queens, the Bronx and Nassau County, New York. For more information, go to www.dime.com.
This News Release contains a number of forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). These statements may be identified by use of words such as "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "outlook," "plan," "potential," "predict," "project," "should," "will," "would" and similar terms and phrases, including references to assumptions.
Forward-looking statements are based upon various assumptions and analyses made by the Company in light of management's experience and its perception of historical trends, current conditions and expected future developments, as well as other factors it believes are appropriate under the circumstances. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors (many of which are beyond the Company's control) that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. These factors include, without limitation, the following: the timing and occurrence or non-occurrence of events may be subject to circumstances beyond the Company's control; there may be increases in competitive pressure among financial institutions or from non-financial institutions; changes in the interest rate environment may reduce interest margins; changes in deposit flows, loan demand or real estate values may adversely affect the business of Dime; changes in accounting principles, policies or guidelines may cause the Company's financial condition to be perceived differently; changes in corporate and/or individual income tax laws may adversely affect the Company's financial condition or results of operations; general economic conditions, either nationally or locally in some or all areas in which the Company conducts business, or conditions in the securities markets or the banking industry may be less favorable than the Company currently anticipates; legislation or regulatory changes may adversely affect the Company's business; technological changes may be more difficult or expensive than the Company anticipates; success or consummation of new business initiatives may be more difficult or expensive than the Company anticipates; or litigation or other matters before regulatory agencies, whether currently existing or commencing in the future, may delay the occurrence or non-occurrence of events longer than the Company anticipates.
DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(In thousands except share amounts)
March 31, December 31,
2016 2015
------------- -------------
ASSETS:
Cash and due from banks $ 192,917 $ 64,154
Investment securities held to maturity 5,290 5,242
Investment securities available for sale 3,787 3,756
Trading securities 10,368 10,201
Mortgage-backed securities available for sale 417 431
Federal funds sold and other short-term
investments - -
Real Estate Loans:
One-to-four family and
cooperative/condomnium apartment 74,734 72,095
Multifamily and loans underlying
cooperatives (1) 4,077,657 3,752,328
Commercial real estate (1) 895,196 863,184
Unearned discounts and net deferred loan
fees 7,706 7,579
------------- -------------
Total real estate loans 5,055,293 4,695,186
------------- -------------
Other loans 1,354 1,590
Allowance for loan losses (18,513) (18,514)
------------- -------------
Total loans, net 5,038,134 4,678,262
------------- -------------
Premises and fixed assets, net 13,770 15,150
Premises held for sale 1,379 8,799
Federal Home Loan Bank of New York capital
stock 63,681 58,713
Other Real Estate Owned 18 148
Goodwill 55,638 55,638
Other assets 131,960 132,378
------------- -------------
TOTAL ASSETS $ 5,517,359 $ 5,032,872
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY:
Deposits:
Non-interest bearing checking $ 250,339 $ 259,182
Interest bearing checking 82,850 78,994
Savings 368,685 368,671
Money Market 1,756,823 1,618,617
------------- -------------
Sub-total 2,458,697 2,325,464
------------- -------------
Certificates of deposit 981,059 858,846
------------- -------------
Total Due to Depositors 3,439,756 3,184,310
------------- -------------
Escrow and other deposits 126,315 77,130
Federal Home Loan Bank of New York advances 1,277,125 1,166,725
Trust preferred notes payable 70,680 70,680
Other liabilities 63,576 40,080
------------- -------------
TOTAL LIABILITIES 4,977,452 4,538,925
------------- -------------
STOCKHOLDERS' EQUITY:
Common stock ($0.01 par, 125,000,000 shares
authorized, 53,326,753 shares and 53,326,753
shares issued at March 31, 2016 and December
31, 2015 respectively, and 37,399,150 shares
and 37,371,992 shares outstanding at March
31, 2016 and December 31, 2015, respectively) 533 533
Additional paid-in capital 263,206 262,798
Retained earnings 496,518 451,606
Accumulated other comprehensive loss, net of
deferred taxes (8,548) (8,801)
Unallocated common stock of Employee Stock
Ownership Plan (2,256) (2,313)
Unearned Restricted Stock Award common stock (2,279) (2,271)
Common stock held by the Benefit Maintenance
Plan (9,353) (9,354)
Treasury stock (15,927, 603 shares and
15,954,761 shares at March 31, 2016 and
December 31, 2015, respectively) (197,914) (198,251)
------------- -------------
TOTAL STOCKHOLDERS' EQUITY 539,907 493,947
------------- -------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 5,517,359 $ 5,032,872
============= =============
(1) While the loans within this category are often considered "commercial
real estate" in nature, multifamily and loans underlying cooperatives are
here reported separately from commercial real estate loans in order to
emphasize the residential nature of the collateral underlying this
significant component of the total loan portfolio.
DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars In thousands except share and per share amounts)
For the Three Months Ended
--------------------------------------
March 31, December 31, March 31,
2016 2015 2015
----------- ------------ -----------
Interest income:
Loans secured by real estate $ 45,651 $ 43,977 $ 41,788
Other loans 24 23 24
Mortgage-backed securities 2 2 181
Investment securities 173 331 169
Federal funds sold and other
short-term investments 661 552 650
----------- ------------ -----------
Total interest income 46,511 44,885 42,812
----------- ------------ -----------
Interest expense:
Deposits and escrow 6,794 6,225 5,220
Borrowed funds 5,086 5,074 7,498
----------- ------------ -----------
Total interest expense 11,880 11,299 12,718
----------- ------------ -----------
Net interest income 34,631 33,586 30,094
Credit for loan losses (21) (439) (172)
----------- ------------ -----------
Net interest income after credit for
loan losses 34,652 34,025 30,266
----------- ------------ -----------
Non-interest income:
Service charges and other fees 685 761 750
Mortgage banking income, net 28 29 72
Gain on sale of real estate
properties 68,187 - -
Gain on the sale of securities
and other assets 40 - 1,388
Gain (loss) on trading securities 6 (14) 62
Other 795 963 1,029
----------- ------------ -----------
Total non-interest income 69,741 1,739 3,301
----------- ------------ -----------
Non-interest expense:
Compensation and benefits 9,708 9,354 6,841
Occupancy and equipment 2,627 2,549 2,944
Federal deposit insurance
premiums 739 602 551
Other 4,795 3,634 3,528
----------- ------------ -----------
Total non-interest expense 17,869 16,139 13,864
----------- ------------ -----------
Income before taxes 86,524 19,625 19,703
Income tax expense 36,487 8,241 7,925
----------- ------------ -----------
Net Income $ 50,037 $ 11,384 $ 11,778
=========== ============ ===========
Earnings per Share ("EPS"):
Basic $ 1.37 $ 0.31 $ 0.33
=========== ============ ===========
Diluted $ 1.36 $ 0.31 $ 0.33
=========== ============ ===========
Average common shares outstanding
for Diluted EPS 36,662,951 36,521,748 36,053,459
DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED SELECTED FINANCIAL HIGHLIGHTS
(Dollars In thousands except per share amounts)
For the Three Months Ended
--------------------------------------
March 31, December 31, March 31,
2016 2015 2015
----------- ------------ -----------
Reconciliation of Reported and
Adjusted ("Core") Net Income (1):
Net Income $ 50,037 $ 11,384 $ 11,778
Less: After tax gain on sale of
securities - - (764)
Add: After-tax expense associated
with the prepayment of borrowings - - 750
Less: After tax gain on the sale of
real estate (37,483) - -
Less: After tax credit on
curtailment of postretirement
health benefits - - (1,868)
----------- ------------ -----------
Adjusted ("Core") net income $ 12,554 $ 11,384 $ 9,896
=========== ============ ===========
Performance Ratios (Based upon
Reported Net Income):
Reported Earnings Per Share ("EPS")
(Diluted) $ 1.36 $ 0.31 $ 0.33
Return on Average Assets 3.87% 0.93% 1.04%
Return on Average Stockholders'
Equity 39.47% 9.32% 10.18%
Return on Average Tangible
Stockholders' Equity 43.49% 10.30% 11.33%
Net Interest Spread 2.63% 2.72% 2.59%
Net Interest Margin 2.80% 2.88% 2.80%
Non-interest Expense to Average
Assets 1.38% 1.32% 1.23%
Efficiency Ratio 49.45% 45.67% 43.32%
Effective Tax Rate 42.17% 41.99% 40.22%
Performance Ratios (Based upon "Core
Net Income" as calculated above):
EPS (Diluted) $ 0.34 $ 0.31 $ 0.27
Return on Average Assets 0.97% 0.93% 0.88%
Return on Average Stockholders'
Equity 9.90% 9.32% 8.56%
Return on Average Tangible
Stockholders' Equity 10.91% 10.30% 9.52%
Net Interest Spread 2.63% 2.72% 2.53%
Net Interest Margin 2.80% 2.88% 2.71%
Non-interest Expense to Average
Assets 1.38% 1.32% 1.53%
Efficiency Ratio 49.45% 45.67% 51.81%
Effective Tax Rate 42.17% 41.99% 39.23%
Book Value and Tangible Book Value
Per Share:
Stated Book Value Per Share $ 14.44 $ 13.22 $ 12.65
Tangible Book Value Per Share 13.18 11.96 11.40
Average Balance Data:
Average Assets $ 5,171,368 $ 4,875,199 $ 4,520,316
Average Interest Earning Assets 4,955,643 4,657,917 4,301,804
Average Stockholders' Equity 507,151 488,845 462,670
Average Tangible Stockholders'
Equity 460,249 442,277 415,827
Average Loans 4,818,516 4,555,291 4,174,083
Average Deposits 3,068,456 3,109,044 2,750,791
Asset Quality Summary:
Net (recoveries) charge-offs $ (20) $ 6 $ 84
Non-performing Loans (excluding
loans held for sale) 1,442 1,611 6,399
Non-performing Loans/ Total Loans 0.03% 0.03% 0.15%
Nonperforming Assets (2) $ 2,705 $ 2,995 $ 7,453
Nonperforming Assets/Total Assets 0.05% 0.06% 0.16%
Allowance for Loan Loss/Total Loans 0.37% 0.39% 0.43%
Allowance for Loan Loss/Non-
performing Loans 1283.84% 1149.22% 285.00%
Loans Delinquent 30 to 89 Days at
period end $ 2,291 $ 2,970 $ 1,239
Consolidated Capital Ratios
Tangible Stockholders' Equity to
Tangible Assets at period end 9.02% 8.98% 9.27%
Tier 1 Capital to Average Assets 10.97% 10.70% 10.81%
Regulatory Capital Ratios (Bank
Only):
Common Equity Tier 1 Capital to
Risk-Weighted Assets 11.50% 11.55% 12.43%
Tier 1 Capital to Risk-Weighted
Assets ("Tier 1 Capital Ratio") 11.50% 11.55% 12.43%
Total Capital to Risk-Weighted
Assets ("Total Capital Ratio") 11.93% 12.03% 12.98%
Tier 1 Capital to Average Assets 9.57% 9.17% 9.24%
(1) Adjusted ("Core") net income is a "non-GAAP" measure. A reconciliation
from the comparable GAAP measure is provided herein.
(2) Amount comprised of total non-accrual loans and the recorded balance of
pooled bank trust preferred security investments that were deemed to meet
the criteria of a non-performing asset.
DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED AVERAGE BALANCES AND NET INTEREST INCOME
(Dollars In thousands)
For the Three Months Ended
--------------------------------------------------------
March 31, 2016 December 31, 2015
--------------------------------------------------------
Average Average
Average Yield/ Average Yield/
Balance Interest Cost Balance Interest Cost
--------------------------------------------------------
Assets:
Interest-earning
assets:
Real estate
loans $4,817,095 $45,651 3.79% $4,553,788 $43,977 3.86%
Other loans 1,421 24 6.76 1,503 23 6.12
Mortgage-backed
securities 414 2 1.93 425 2 1.88
Investment
securities 20,217 173 3.42 18,773 331 7.05
Federal funds
sold and other
short-term
investments 116,496 661 2.27 83,428 552 2.65
-------------------------- --------------------------
Total interest
earning
assets 4,955,643 $46,511 3.75% 4,657,917 $44,885 3.85%
------------------ ------------------
Non-interest
earning assets 215,725 217,282
---------- ----------
Total assets $5,171,368 $4,875,199
========== ==========
Liabilities and
Stockholders'
Equity:
Interest-bearing
liabilities:
Interest Bearing
Checking
accounts $ 79,839 $ 56 0.28% $ 76,932 $ 56 0.29%
Money Market
accounts 1,689,903 3,379 0.80 1,548,821 3,060 0.78
Savings accounts 367,707 45 0.05 365,563 46 0.05
Certificates of
deposit 931,007 3,314 1.43 873,910 3,063 1.39
-------------------------- --------------------------
Total
interest
bearing
deposits 3,068,456 6,794 0.89 2,865,226 6,225 0.86
Borrowed Funds 1,182,114 5,086 1.73 1,094,438 5,074 1.84
-------------------------- --------------------------
Total
interest-
bearing
liabilities 4,250,570 $11,880 1.12% 3,959,664 $11,299 1.13%
------------------ ------------------
Non-interest
bearing checking
accounts 260,977 243,818
Other non-
interest-bearing
liabilities 152,670 182,872
---------- ----------
Total
liabilities 4,664,217 4,386,354
Stockholders'
equity 507,151 488,845
---------- ----------
Total liabilities
and stockholders'
equity $5,171,368 $4,875,199
========== ==========
Net interest income $34,631 $33,586
======= =======
Net interest spread 2.63% 2.72%
====== ======
Net interest-
earning assets $ 705,073 $ 698,253
========== ==========
Net interest margin 2.80% 2.88%
====== ======
Ratio of interest-
earning assets to
interest-bearing
liabilities 116.59% 117.63%
======= =======
Deposits (including
non-interest
bearing checking
accounts) $3,329,433 $ 6,794 0.82% $3,109,044 $ 6,225 0.79%
----------------------------------------------------------------------------
SUPPLEMENTAL
INFORMATION
----------------------------------------------------------------------------
Loan prepayment and late
payment fee income $ 2,618 $ 2,675
----------------------------------------------------------------------------
Borrowing
prepayment costs - -
----------------------------------------------------------------------------
Real estate loans (excluding
net prepayment and late
payment fee income) 3.57% 3.63%
----------------------------------------------------------------------------
Interest earning assets (excluding net
prepayment and late payment fee
income) 3.54% 3.62%
----------------------------------------------------------------------------
Borrowings
(excluding
prepayment costs) 1.73% 1.84%
----------------------------------------------------------------------------
Interest bearing liabilities
(excluding borrowing
prepayment costs) 1.12% 1.13%
----------------------------------------------------------------------------
Net Interest income
(excluding loan
prepayment and
late payment fees
and borrowing
prepayment costs) $32,013 $30,911
----------------------------------------------------------------------------
Net Interest margin
(excluding loan
prepayment and
late payment fees
and borrowing
prepayment costs) 2.58% 2.65%
----------------------------------------------------------------------------
For the Three Months Ended
---------------------------
March 31, 2015
---------------------------
Average
Average Yield/
Balance Interest Cost
---------------------------
Assets:
Interest-earning
assets:
Real estate
loans $4,172,422 $41,788 4.01%
Other loans 1,661 24 5.78
Mortgage-backed
securities 23,119 181 3.13
Investment
securities 18,414 169 3.67
Federal funds
sold and other
short-term
investments 86,188 650 3.02
--------------------------
Total interest
earning
assets 4,301,804 $42,812 3.98%
---------- -------
Non-interest
earning assets 218,512
----------
Total assets $4,520,316
==========
Liabilities and
Stockholders'
Equity:
Interest-bearing
liabilities:
Interest Bearing
Checking
accounts $ 77,086 $ 55 0.29%
Money Market
accounts 1,179,713 1,915 0.66
Savings accounts 372,308 45 0.05
Certificates of
deposit 928,039 3,205 1.40
--------------------------
Total
interest
bearing
deposits 2,557,146 5,220 0.81
Borrowed Funds 1,162,983 7,498 2.61
---------------------------
Total
interest-
bearing
liabilities 3,720,129 $12,718 1.39%
------------------
Non-interest
bearing checking
accounts 193,645
Other non-
interest-bearing
liabilities 143,872
----------
Total
liabilities 4,057,646
Stockholders'
equity 462,670
----------
Total liabilities
and stockholders'
equity $4,520,316
==========
Net interest income $30,094
=======
Net interest spread 2.59%
=======
Net interest-
earning assets $ 581,675
==========
Net interest margin 2.80%
=======
Ratio of interest-
earning assets to
interest-bearing
liabilities 115.64%
======
Deposits (including
non-interest
bearing checking
accounts) $2,750,791 $ 5,220 0.77%
----------------------------------------------
SUPPLEMENTAL
INFORMATION
----------------------------------------------
Loan prepayment and
late payment fee
income $ 2,299
----------------------------------------------
Borrowing
prepayment costs $ 1,362
----------------------------------------------
Real estate loans
(excluding net
prepayment and
late payment fee
income) 3.79%
----------------------------------------------
Interest earning
assets (excluding
net prepayment and
late payment fee
income) 3.77%
----------------------------------------------
Borrowings
(excluding
prepayment costs) 2.14%
----------------------------------------------
Interest bearing
liabilities
(excluding
borrowing
prepayment costs) 1.24%
----------------------------------------------
Net Interest income
(excluding loan
prepayment and
late payment fees
and borrowing
prepayment costs) $29,157
----------------------------------------------
Net Interest margin
(excluding loan
prepayment and
late payment fees
and borrowing
prepayment costs) 2.71%
----------------------------------------------
DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED SCHEDULE OF NON-PERFORMING ASSETS AND TROUBLED DEBT RESTRUCTURINGS
("TDRs")
(Dollars In thousands)
At March 31, At December 31, At March 31,
Non-Performing Loans 2016 2015 2015
------------ ---------------- ------------
One- to four-family and
cooperative/condominium
apartment $ 1,102 $ 1,113 $ 1,141
Multifamily residential and
mixed use residential real
estate (1)(2) 287 287 537
Mixed use commercial real
estate (2) 53 - -
Commercial real estate - 207 4,717
Other - 4 4
------------ ---------------- ------------
Total Non-Performing Loans (3) $ 1,442 $ 1,611 $ 6,399
------------ ---------------- ------------
Other Non-Performing Assets
Non-performing loans held for
sale - - -
Other real estate owned 18 148 148
Pooled bank trust preferred
securities (4) 1,245 1,236 906
------------ ---------------- ------------
Total Non-Performing Assets $ 2,705 $ 2,995 $ 7,453
------------ ---------------- ------------
TDRs not included in non-
performing loans (3)
One- to four-family and
cooperative/condominium
apartment 384 598 603
Multifamily residential and
mixed use residential real
estate (1)(2) 685 696 721
Mixed use commercial real
estate (2) 4,324 4,344 4,400
Commercial real estate 3,412 3,428 3,475
------------ ---------------- ------------
Total Performing TDRs $ 8,805 $ 9,066 $ 9,199
------------ ---------------- ------------
(1) Includes loans underlying cooperatives.
(2) While the loans within these categories are often considered "commercial
real estate" in nature, they are classified separately in this table
because there is a residential component to the income, which makes them
generally viewed as less risky than pure commercial real estate loans.
(3) Total non-performing loans include some loans that were modified in a
manner that met the criteria for a TDR. These non-accruing TDRs, which
totaled $207 at December 31, 2015 and $5,088 at March 31, 2015, are
included in the non-performing loan table, but excluded from the TDR
amount shown above. There were no non-accruing TDRs at March 31, 2016.
(4) As of the dates indicated, certain pooled bank trust preferred
securities were deemed to meet the criteria of a non-performing asset.
PROBLEM ASSETS AS A PERCENTAGE OF TANGIBLE CAPITAL AND RESERVES
At March 31, At December 31, At March 31,
2016 2015 2015
------------ ---------------- ------------
Total Non-Performing Assets $ 2,705 $ 2,995 $ 7,453
Loans 90 days or more past due on
accrual status (5) 4,713 4,532 1,711
------------ ---------------- ------------
TOTAL PROBLEM ASSETS $ 7,418 $ 7,527 $ 9,164
------------ ---------------- ------------
Tier One Capital - The Dime
Savings Bank of Williamsburgh $ 487,759 $ 440,374 $ 416,067
Allowance for loan losses 18,513 18,514 18,237
------------ ---------------- ------------
TANGIBLE CAPITAL PLUS RESERVES $ 506,272 $ 458,888 $ 434,304
------------ ---------------- ------------
PROBLEM ASSETS AS A PERCENTAGE OF
TANGIBLE CAPITAL AND RESERVES 1.5% 1.6% 2.1%
(5) These loans were, as of the respective dates indicated, expected to be
either satisfied, made current or re-financed within the following
twelve months, and were not expected to result in any loss of
contractual principal or interest. These loans are not included in non-
performing loans.
Contact: Kenneth Ceonzo
Director of Investor Relations
718-782-6200 extension 8279
Source: Dime Community Bancshares
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