• Dime Community Bancshares, Inc. Reports Strong Third Quarter 2022 Results With Earnings Per Share Increasing By 10% On a Year-Over-Year Basis

    Source: Nasdaq GlobeNewswire / 28 Oct 2022 06:00:01   America/New_York

    Robust Quarterly Loan Originations and Net Interest Margin Expansion Drive Net Interest Income Growth

    Deposit Costs Remain Well Controlled

    HAUPPAUGE, N.Y., Oct. 28, 2022 (GLOBE NEWSWIRE) -- Dime Community Bancshares, Inc. (NASDAQ: DCOM) (the “Company” or “Dime”), the parent company of Dime Community Bank (the “Bank”), today reported net income available to common stockholders of $37.7 million for the quarter ended September 30, 2022, or $0.98 per diluted common share, compared to $36.7 million, or $0.94 per diluted common share, for the quarter ended June 30, 2022, and $36.6 million, or $0.89 per diluted common share, for the quarter ended September 30, 2021.

    Kevin M. O’Connor, Chief Executive Officer (“CEO”) of the Company, stated, “During the third quarter, we had robust loan originations resulting in another quarter of record loan growth of over $450 million. The high level of non-interest-bearing deposits on our balance sheet allowed us to keep our deposit costs well contained. Strong growth in average earning assets and net interest margin expansion resulted in quarterly net interest income surpassing $100 million. We continue to prioritize prudent expense management as demonstrated by a core efficiency ratio of 47% on a year-to-date basis.”

    Highlights for the Third Quarter of 2022 Included:

    • Total loans held for investment, net, excluding Paycheck Protection Program (“PPP”) loans, increased by 19% on an annualized basis versus the linked quarter;
    • The net interest margin expanded by 9 basis points versus the linked quarter;
    • The cost of deposits remained well-controlled; on a linked quarter basis, the cost of deposits increased by only 23 basis points compared to the 150 basis points change in the Federal Funds rate between July and September;
    • Credit quality continues to be strong with non-performing assets and loans 90 days past due and accruing remaining stable and representing only 0.34% of total assets as of September 30, 2022; and
    • The Company repurchased 200,346 shares of its common stock, which represented approximately 0.5% of shares outstanding at the beginning of the period, at a weighted-average price of $30.97 per share.

    Management’s Discussion of Quarterly Operating Results

    Net Interest Income

    Net interest income for the third quarter of 2022 was $100.4 million compared to $93.5 million for the second quarter of 2022 and $94.8 million for the third quarter of 2021.

    The table below provides a reconciliation of the reported net interest margin (“NIM”) and adjusted NIM excluding the impact of purchase accounting accretion on the loan portfolio.

               
    (Dollars in thousands) Q3 2022 Q2 2022 Q3 2021 
    Net interest income $ 100,438  $93,512 $94,828  
    Purchase accounting accretion on loans ("PAA")   (57)  117  (2,541) 
    Adjusted net interest income excluding PAA on loans (non-GAAP) $ 100,381  $93,629 $92,287  
               
    Average interest-earning assets $ 11,782,361  $11,412,350 $11,765,298  
               
    NIM (1)   3.38 %   3.29% 3.20 %
    Adjusted NIM excluding PAA on loans (non-GAAP) (2)   3.38 %   3.29% 3.11 %

    (1)   NIM represents net interest income divided by average interest-earning assets.
    (2)   Adjusted NIM excluding PAA on loans represents adjusted net interest income, which excludes net interest income on PAA loans divided by average interest-earning assets.

    Loan Portfolio

    The ending weighted average rate (“WAR”)(1) on the total loan portfolio was 4.33% at September 30, 2022, a 39 basis point increase compared to the ending WAR on the total loan portfolio at June 30, 2022.

    Outlined below are loan balances and WARs for the period ended as indicated.

                     
      September 30, 2022 June 30, 2022 September 30, 2021 
    ($ in thousands)    Balance    WAR    Balance    WAR    Balance    WAR 
    Loans held for investment balances at period end:                
    Commercial and industrial ("C&I") $ 900,768  5.90%  $941,944 4.97%$878,332 4.10%
    Owner-occupied commercial real estate   1,090,417  4.69  1,043,184 4.20  966,895 4.11 
    Business loans   1,991,185  5.24  1,985,128 4.57  1,845,227 4.11 
    One-to-four family residential, including condominium and cooperative apartment   722,081  3.77  691,586 3.60  683,665 3.68 
    Multifamily residential and residential mixed-use (2)(3)   3,968,244  3.83  3,654,164 3.62  3,468,262 3.57 
    Non-owner-occupied commercial real estate   3,174,102  4.33  3,048,188 3.89  2,847,793 3.70 
    Acquisition, development, and construction   241,019  6.75  252,108 5.41  285,379 4.69 
    Other loans   8,927  7.29  10,789 7.16  20,462 4.97 
    Loans held for investment, excluding PPP loans   10,105,558  4.33  9,641,963 3.95  9,150,788 3.76 
    PPP loans   11,383  1.00  18,944 1.00  134,083 1.00 
    Total loans held for investment, including PPP loans $ 10,116,941  4.33%  $9,660,907 3.94%$9,284,871 3.72%

    (1)  Weighted average rate is calculated by aggregating interest based on the current loan rate from each loan in the category, adjusted for non-accrual loans, divided by the total amount of loans in the category.
    (2)  Includes loans underlying multifamily cooperatives.
    (3)  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.

    Outlined below are the loan originations, excluding PPP loans, for the quarter ended as indicated.

    ($ in millions) Q3 2022 Q2 2022    Q3 2021
    Loan originations, excluding PPP loans $ 800.9  $901.5  $464.5 


    Deposits

    Total average deposits for the third quarter were $10.6 billion, compared to $10.3 billion for the second quarter. The cost of deposits increased by 23 basis points on a linked quarter basis. CEO O’Connor stated, “Despite the significant increase in interest rates, we grew average deposit balances on a linked quarter basis, maintained our non-interest bearing deposit ratio at approximately 37% and kept overall deposits costs relatively well-contained.”

    Non-Interest Income

    Non-interest income was $9.4 million during the third quarter of 2022, $12.1 million during the second quarter of 2022, and $9.7 million during the third quarter of 2021. Included in non-interest income during the third quarter of 2022 was a $1.4 million gain on the sale of a branch property. Included in non-interest income for the second quarter of 2022 was $2.2 million of income related to mortality proceeds from a death claim. Excluding the net gain on sale of securities and other assets, adjusted non-interest income was $8.0 million during the third quarter of 2022 (see “Non-GAAP Reconciliation” tables at the end of this news release).

    Non-Interest Expense

    Total non-interest expense was $48.3 million during the third quarter of 2022, $51.8 million during the second quarter of 2022, and $56.8 million during the third quarter of 2021. Excluding the impact of merger expenses and transaction costs, branch restructuring, severance expense, loss on extinguishment of debt, and amortization of other intangible assets, adjusted non-interest expense was $47.9 million during the third quarter of 2022, $48.5 million during the second quarter of 2022, and $49.1 million during the third quarter of 2021 (see “Non-GAAP Reconciliation” tables at the end of this news release).

    The ratio of non-interest expense to average assets was 1.54% during the third quarter of 2022, compared to 1.71% during the linked quarter and 1.80% for the third quarter of 2021. Excluding the impact of merger expenses and transaction costs, branch restructuring, severance expense, loss on extinguishment of debt, and amortization of other intangible assets, the ratio of adjusted non-interest expense to average assets was 1.53% during the third quarter of 2022, compared to 1.60% during the linked quarter and 1.56% for the third quarter of 2021 (see “Non-GAAP Reconciliation” tables at the end of this news release).

    The efficiency ratio was 44.0% during the third quarter of 2022, compared to 49.1% during the linked quarter and 54.3% during the third quarter of 2021. Excluding the impact of merger expenses and transaction costs, branch restructuring, severance expense, loss on extinguishment of debt, amortization of other intangible assets, and gain on sale of securities and other assets, the adjusted efficiency ratio was 44.2% during the third quarter of 2022, compared to 45.9% during the linked quarter and 46.9% during the third quarter of 2021 (see “Non-GAAP Reconciliation” tables at the end of this news release).

    Income Tax Expense

    The reported effective tax rate for the third quarter of 2022 was 28.1%, compared to 28.4% for the second quarter of 2022, and 27.5% for the third quarter of 2021.

    Credit Quality

    Non-performing loans at September 30, 2022 were $41.1 million, or 0.41% of total loans.

    A credit loss provision of $6.6 million was recorded during the third quarter of 2022, compared to a credit loss provision of $44 thousand during the second quarter of 2022, and a credit loss recovery of $5.2 million during the third quarter of 2021. The credit loss provision for the third quarter was primarily associated with changes to the forecasted macroeconomic conditions used in the Bank’s allowance for credit loss model.

    The allowance for credit losses as a percentage of total loans was 0.81% at September 30, 2022 as compared to 0.82% at June 30, 2022 and 0.88% at September 30, 2021.

    Capital Management

    The Company’s and the Bank’s regulatory capital ratios continued to be in excess of all applicable regulatory requirements as of September 30, 2022.

    CEO O’Connor commented, “During the third quarter, we continued to execute on our share repurchase program and we repurchased $6.2 million of common stock. On a year-to-date basis we have repurchased approximately $46.5 million of common stock, representing approximately 4% of shares outstanding at the beginning of the year. Our regulatory capital ratios, which exclude the impact of the accumulated other comprehensive loss component of stockholders’ equity, continue to be very strong. Our solid asset quality metrics and internal stress testing analyses continue to provide support for growing our balance sheet and future capital return to shareholders.”

    Dividends per common share were $0.24 during the third quarter of 2022.

    Book value per common share was $26.55 at September 30, 2022 compared to $26.41 at June 30, 2022. Tangible common book value per share (which represents common equity less goodwill and other intangible assets, divided by the number of shares outstanding) was $22.34 at September 30, 2022 compared to $22.20 at June 30, 2022. Excluding the impact of AOCI, the adjusted tangible common book value per share was $24.75 at September 30, 2022 compared to $24.01 at June 30, 2022 (see “Non-GAAP Reconciliation” tables at the end of this news release).

    Earnings Call Information

    The Company will conduct a conference call at 8:30 a.m. (ET) on Friday, October 28, 2022, during which CEO O’Connor will discuss the Company’s third quarter 2022 financial performance, with a question-and-answer session to follow.

    The conference call will be simultaneously webcast (listen only) and archived for a period of one year at https://events.q4inc.com/attendee/927279052.

    Conference Call Details:

    Dial-in for Live Call:

    United States: 
    International:
    Access code:
    		1-844-200-6205
    +1-929-526-1599
    728364
      

    Telephone Replay:

    A recording will be available until Friday, November 11, 2022.

    United States: 
    International:
    Access code:    		1-866-813-9403
    +44-204-525-0658
    471079
      

    ABOUT DIME COMMUNITY BANCSHARES, INC.
    Dime Community Bancshares, Inc. is the holding company for Dime Community Bank, a New York State-chartered trust company with over $12.8 billion in assets and the number one deposit market share among community banks on Greater Long Island(1).

    (1) Aggregate deposit market share for Kings, Queens, Nassau & Suffolk counties for community banks less than $20 billion in assets.

    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 “annualized," “anticipate," "believe," “continue,” "could," "estimate," "expect," "intend," “likely,” "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. Accordingly, you should not place undue reliance on such statements. Factors that could affect our results 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 affect demand for our products and reduce interest margins and the value of our investments; changes in deposit flows, loan demand or real estate values may adversely affect the business of the Company; changes in the quality and composition of the Company’s loan or investment portfolios or unanticipated or significant increases in loan losses may negatively affect the Company’s financial condition or results of operations; 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; there may be failures or breaches of information technology security systems; success or consummation of new business initiatives may be more difficult or expensive than the Company anticipates; and 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. Further, given its ongoing and dynamic nature, it is difficult to predict what effects the COVID-19 pandemic will have on our business and results of operations. The pandemic and related local and national economic disruption may, among other effects, result in a decline in demand for our products and services; increased levels of loan delinquencies, problem assets and foreclosures; branch closures, work stoppages and unavailability of personnel; and increased cybersecurity risks, as employees work remotely. For discussion of these and other risks that may cause actual results to differ from expectations, please refer to the sections entitled “Forward-Looking Statements” and “Risk Factors” in the Company’s most recent Annual Report on Form 10-K and updates set forth in the Company’s subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.

      
    Contact: Avinash Reddy 
    Senior Executive Vice President – Chief Financial Officer 
    718-782-6200 extension 5909 



    DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
    UNAUDITED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
    (In thousands)

         September 30,     June 30,     December 31, 
      2022 2022 2021
    Assets:           
    Cash and due from banks $ 312,996  $281,487  $393,722 
    Securities available-for-sale, at fair value   962,927   1,007,757   1,563,711 
    Securities held-to-maturity   591,403   579,965   179,309 
    Loans held for sale   289   530   5,493 
    Loans held for investment, net:          
    C&I   900,768   941,944   867,542 
    Owner-occupied commercial real estate   1,090,417   1,043,184   1,030,240 
    Total business loans   1,991,185   1,985,128   1,897,782 
    One-to-four family and cooperative/condominium apartment   722,081   691,586   669,282 
    Multifamily residential and residential mixed-use (1)(2)   3,968,244   3,654,164   3,356,346 
    Non-owner-occupied commercial real estate   3,174,102   3,048,188   2,915,708 
    Acquisition, development, and construction   241,019   252,108   322,628 
    Small Business Administration ("SBA") Paycheck Protection Program ("PPP") loans   11,383   18,944   66,017 
    Other loans   8,927   10,789   16,898 
    Allowance for credit losses   (81,935)  (79,426)  (83,853)
    Total loans held for investment, net   10,035,006   9,581,481   9,160,808 
    Premises and fixed assets, net   47,406   48,686   50,368 
    Premises held for sale   —   556   556 
    Restricted stock   65,656   42,110   37,732 
    Bank Owned Life Insurance ("BOLI")   331,105   328,928   295,789 
    Goodwill   155,797   155,797   155,797 
    Other intangible assets   6,915   7,346   8,362 
    Operating lease assets   57,916   59,511   64,258 
    Derivative assets   162,679   106,917   45,086 
    Accrued interest receivable   41,567   38,382   40,149 
    Other assets   114,241   107,632   65,224 
    Total assets $ 12,885,903  $12,347,085  $12,066,364 
    Liabilities:          
    Non-interest-bearing checking $ 3,830,676  $3,839,724  $3,920,423 
    Interest-bearing checking   936,082   870,974   905,717 
    Savings   2,237,409   2,011,609   1,158,040 
    Money market   2,553,729   2,884,382   3,621,552 
    Certificates of deposit   930,774   959,312   853,242 
    Total deposits   10,488,670   10,566,001   10,458,974 
    FHLBNY advances   620,000   100,000   25,000 
    Other short-term borrowings   2,124   2,162   1,862 
    Subordinated debt, net   200,305   200,327   197,096 
    Derivative cash collateral   158,200   115,790   4,550 
    Operating lease liabilities   60,252   61,850   66,103 
    Derivative liabilities   144,343   93,420   40,728 
    Other liabilities   71,218   67,013   79,431 
    Total liabilities   11,745,112   11,206,563   10,873,744 
    Stockholders' equity:          
    Preferred stock, Series A   116,569   116,569   116,569 
    Common stock   416   416   416 
    Additional paid-in capital   495,232   495,266   494,125 
    Retained earnings   733,783   705,371   654,726 
    Accumulated other comprehensive loss ("AOCI"), net of deferred taxes   (93,036)  (69,950)  (6,181)
    Unearned equity awards   (9,177)  (10,260)  (7,842)
    Treasury stock, at cost   (102,996)  (96,890)  (59,193)
    Total stockholders' equity   1,140,791   1,140,522   1,192,620 
    Total liabilities and stockholders' equity $ 12,885,903  $12,347,085  $12,066,364 

    (1)  Includes loans underlying multifamily cooperatives.
    (2)  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)

      Three Months Ended  Nine Months Ended
         September 30,     June 30,     September 30,     September 30,     September 30, 
      2022 2022 2021 2022 2021
    Interest income:                   
    Loans $ 106,306  $93,102  $94,045  $ 285,828  $269,715 
    Securities   7,374   7,067   6,030    21,572   15,537 
    Other short-term investments   847   741   583    1,956   2,562 
    Total interest income   114,527   100,910   100,658    309,356   287,814 
    Interest expense:                    
    Deposits and escrow   10,154   3,731   3,565    16,416   13,666 
    Borrowed funds   3,483   3,573   2,265    9,334   8,225 
    Derivative cash collateral   452   94   —    547   — 
    Total interest expense   14,089   7,398   5,830    26,297   21,891 
    Net interest income   100,438   93,512   94,828    283,059   265,923 
    Provision (credit) for credit losses   6,587   44   (5,187)   5,039   6,344 
    Net interest income after provision (credit)   93,851   93,468   100,015    278,020   259,579 
    Non-interest income:                    
    Service charges and other fees   3,866   4,337   4,581    12,261   11,377 
    Title fees   474   683   482    1,578   1,603 
    Loan level derivative income   549   1,685   445    2,240   2,796 
    BOLI income   2,177   4,143   2,249    8,159   5,181 
    Gain on sale of SBA loans   211   723   348    1,176   1,485 
    Gain on sale of PPP loans   —   —   —    —   20,697 
    Gain on sale of residential loans   54   191   304    393   1,533 
    Net gain on equity securities   —   —   —    —   131 
    Net gain on sale of securities and other assets   1,397   —   —    1,397   730 
    Loss on termination of derivatives   —   —   —    —   (16,505)
    Other   634   362   1,319    1,485   2,861 
    Total non-interest income   9,362   12,124   9,728    28,689   31,889 
    Non-interest expense:                    
    Salaries and employee benefits   29,188   28,454   28,276    88,476   80,693 
    Severance   —   2,193   —    2,193   1,875 
    Occupancy and equipment   7,884   7,396   7,814    22,864   22,913 
    Data processing costs   3,434   3,913   3,573    11,152   12,132 
    Marketing   1,531   1,515   1,054    4,341   2,702 
    Professional services   2,116   2,028   2,751    6,238   7,154 
    Federal deposit insurance premiums   800   1,150   1,173    3,100   3,046 
    Loss on extinguishment of debt   —   740   —    740   1,751 
    Curtailment loss   —   —   —    —   1,543 
    Merger expenses and transaction costs   —   —   2,472    —   42,250 
    Branch restructuring   —   —   4,518    —   6,177 
    Amortization of other intangible assets   431   430   715    1,447   1,907 
    Other   2,918   4,019   4,437    9,477   10,327 
    Total non-interest expense   48,302   51,838   56,783    150,028   194,470 
    Income before taxes   54,911   53,754   52,960    156,681   96,998 
    Income tax expense   15,430   15,269   14,565    44,184   28,359 
    Net income   39,481   38,485   38,395    112,497   68,639 
    Preferred stock dividends   1,822   1,822   1,822    5,465   5,465 
    Net income available to common stockholders $ 37,659  $36,663  $36,573  $ 107,032  $63,174 
    Earnings per common share ("EPS"):                    
    Basic $ 0.98  $0.94  $0.89  $ 2.74  $1.62 
    Diluted $ 0.98  $0.94  $0.89  $ 2.74  $1.62 
                       
    Average common shares outstanding for diluted EPS   38,165,681   38,631,683   40,426,161    38,678,894   38,574,857 



    DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
    UNAUDITED SELECTED FINANCIAL HIGHLIGHTS
    (Dollars in thousands except per share amounts)

                     
      At or For the Three Months Ended  At or For the Nine Months Ended  
         September 30,     June 30,     September 30,     September 30,     September 30,  
      2022 2022 2021 2022 2021 
    Per Share Data:                
    Reported EPS (Diluted) $ 0.98 $0.94 $0.89 $ 2.74 $1.62 
    Cash dividends paid per common share   0.24  0.24  0.24   0.72  0.72 
    Book value per common share   26.55  26.41  26.64   26.55  26.64 
    Tangible common book value per share (1)   22.34  22.20  22.60   22.34  22.60 
    Tangible common book value per share excluding AOCI (1)   24.75  24.01  22.63   24.75  22.63 
    Common shares outstanding   38,572  38,769  40,715   38,572  40,715 
    Dividend payout ratio   24.49%   25.53% 26.97%  26.28% 44.44%
                     
    Performance Ratios (Based upon Reported Net Income):                 
    Return on average assets   1.26%   1.27% 1.22%  1.22% 0.76%
    Return on average equity   13.56  13.44  12.69   12.83  8.00 
    Return on average tangible common equity (1)   17.15  17.08  15.96   16.20  9.84 
    Net interest margin   3.38  3.29  3.20   3.29  3.15 
    Non-interest expense to average assets   1.54  1.71  1.80   1.63  2.16 
    Efficiency ratio (1)   44.0  49.1  54.3   48.1  65.3 
    Effective tax rate   28.10  28.41  27.50   28.20  29.24 
                     
    Balance Sheet Data:                 
    Average assets $ 12,550,626 $12,121,949 $12,584,372 $ 12,292,051 $12,009,522 
    Average interest-earning assets   11,782,361  11,412,350  11,765,298   11,511,149  11,277,257 
    Average tangible common equity (1)   885,182  865,329  929,131   889,044  873,481 
    Loan-to-deposit ratio at end of period   96.5  91.4  87.0   96.5  87.0 
                     
    Capital Ratios and Reserves - Consolidated: (3)                 
    Tangible common equity to tangible assets (1)   6.77%   7.07% 7.54%      
    Tangible common equity excluding AOCI to tangible assets (1)   7.45  7.60  7.55       
    Tangible equity to tangible assets (1)   7.69  8.02  8.50       
    Tangible equity excluding AOCI to tangible assets (1)   8.36  8.55  8.51       
    Tier 1 common equity ratio   9.13  9.28  9.92       
    Tier 1 risk-based capital ratio   10.25  10.44  11.17       
    Total risk-based capital ratio   12.98  13.26  14.13       
    Tier 1 leverage ratio   8.61  8.71  8.37       
    CRE consolidated concentration ratio (2)   555  534  516       
    Allowance for credit losses/ Total loans   0.81  0.82  0.88       
    Allowance for credit losses/ Non-performing loans   199.45  218.80  238.84       
                     

    (1)  See "Non-GAAP Reconciliation" tables for reconciliation of tangible equity, tangible common equity, and tangible assets.
    (2)  The CRE consolidated concentration ratio is calculated using the sum of commercial real estate, excluding owner-occupied commercial real estate, multifamily, and acquisition, development, and construction, divided by consolidated capital. September 30, 2022 amounts are preliminary pending completion and filing of the Company’s regulatory reports.
    (3)  September 30, 2022 amounts are preliminary pending completion and filing of the Company’s regulatory reports.



    DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
    UNAUDITED AVERAGE BALANCES AND NET INTEREST INCOME
    (Dollars in thousands)

      Three Months Ended
      September 30, 2022 June 30, 2022 September 30, 2021
            Average       Average       Average
      Average    Yield/ Average    Yield/ Average    Yield/
      Balance Interest Cost Balance Interest Cost Balance Interest Cost
    Assets:                              
    Interest-earning assets:                              
    Real estate loans $ 8,981,848 $ 92,309  4.08%   $8,532,979 $81,454 3.83% $8,289,973 $78,820 3.77%
    Commercial and industrial loans   940,628   13,837  5.84   935,813  11,503 4.93   1,134,980  14,786 5.17 
    Other loans   10,566   160  6.01   11,571  145 5.03   21,391  439 8.14 
    Securities   1,666,398   7,374  1.76   1,695,702  7,067 1.67   1,438,348  6,030 1.66 
    Other short-term investments   182,921   847  1.84   236,285  741 1.26   880,606  583 0.26 
    Total interest-earning assets   11,782,361   114,527  3.86%    11,412,350  100,910 3.55%  11,765,298  100,658 3.39%
    Non-interest-earning assets   768,265          709,599        819,074      
    Total assets $ 12,550,626         $12,121,949       $12,584,372      
                                
    Liabilities and Stockholders' Equity:                              
    Interest-bearing liabilities:                              
    Interest-bearing checking $ 833,386 $ 970  0.46%   $858,402 $604 0.28% $1,000,435 $388 0.15%
    Money market   2,651,459   2,046  0.31   3,148,472  1,240 0.16   3,698,124  1,467 0.16 
    Savings   2,243,887   4,951  0.88   1,509,776  859 0.23   1,335,310  170 0.05 
    Certificates of deposit   988,827   2,187  0.88   827,286  1,028 0.50   1,138,853  1,540 0.54 
    Total interest-bearing deposits   6,717,559   10,154  0.60   6,343,936  3,731 0.24   7,172,722  3,565 0.20 
    FHLBNY advances   166,739   430  1.02   79,176  172 0.87   25,000  59 0.94 
    Subordinated debt, net   200,320   2,553  5.06   273,470  3,309 4.85   197,172  2,206 4.44 
    Other short-term borrowings   75,975   500  2.61   54,229  92 0.68   2,290  — — 
    Total borrowings   443,034   3,483  3.12   406,875  3,573 3.52   224,462  2,265 4.00 
    Derivative cash collateral   111,325   452  1.61   98,995  94 0.38   1,695  — — 
    Total interest-bearing liabilities   7,271,918   14,089  0.77%    6,849,806  7,398 0.43%  7,398,879  5,830 0.31%
    Non-interest-bearing checking   3,894,093          3,935,765        3,787,928      
    Other non-interest-bearing liabilities   219,883          191,066        186,977      
    Total liabilities   11,385,894          10,976,637        11,373,784      
    Stockholders' equity   1,164,732          1,145,312        1,210,588      
    Total liabilities and stockholders' equity $ 12,550,626         $12,121,949       $12,584,372      
    Net interest income     $ 100,438        $93,512       $94,828   
    Net interest rate spread          3.09%         3.12%       3.08%
    Net interest margin          3.38%         3.29%         3.20%
    Deposits (including non-interest-bearing checking accounts) $ 10,611,652 $ 10,154  0.38%   $10,279,701 $3,731 0.15% $10,960,650 $3,565 0.13%



    DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
    UNAUDITED SCHEDULE OF NON-PERFORMING ASSETS
    (Dollars in thousands)

         At or For the Three Months Ended
      September 30,     June 30,     September 30, 
    Asset Quality Detail 2022 2022 2021
    Non-performing loans ("NPLs") (1)          
    One-to-four family residential, including condominium and cooperative apartment $ 3,219  $3,128  $4,938 
    Multifamily residential and residential mixed-use   —   —   859 
    Commercial real estate   7,673   5,020   4,122 
    Acquisition, development, and construction   657   657   — 
    C&I   29,532   27,365   23,727 
    Other   —   131   374 
    Total Non-accrual loans $ 41,081  $36,301  $34,020 
    Total Non-performing assets ("NPAs") $ 41,081  $36,301  $34,020 
              
    Loans 90 days delinquent and accruing ("90+ Delinquent")          
    One-to-four family residential, including condominium and cooperative apartment $ —  $341  $5,021 
    Multifamily residential and residential mixed-use   —   —   — 
    Commercial real estate   —   —   1,004 
    Acquisition, development, and construction   —   —   — 
    C&I   2,781   24   257 
    Other   —   —   — 
    90+ Delinquent $ 2,781  $365  $6,282 
              
    NPAs and 90+ Delinquent $ 43,862  $36,666  $40,302 
              
    NPAs and 90+ Delinquent / Total assets  0.34%  0.30%  0.33%
    Net charge-offs (recoveries) ("NCOs") $ 3,932  $555  $4,191 
    NCOs / Average loans (1)  0.16%  0.02%  0.18%

    (1)  Calculated based on annualized NCOs to average loans, excluding loans held for sale.    



    DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
    NON-GAAP RECONCILIATION
    (Dollars in thousands except per share amounts)

    The following tables below provide a reconciliation of certain financial measures calculated under generally accepted accounting principles ("GAAP") (as reported) and non-GAAP measures. A non-GAAP financial measure is a numerical measure of historical or future financial performance, financial position or cash flows that excludes or includes amounts that are required to be disclosed in the most directly comparable measure calculated and presented in accordance with GAAP in the United States. The Company’s management believes the presentation of non-GAAP financial measures provide investors with a greater understanding of the Company’s operating results in addition to the results measured in accordance with GAAP. While management uses these non-GAAP measures in its analysis of the Company’s performance, this information should not be viewed as a substitute for financial results determined in accordance with GAAP or considered to be more important than financial results determined in accordance with GAAP.

    The following non-GAAP financial measures exclude pre-tax income and expenses associated with the Company’s February 2021 merger with Bridge Bancorp, Inc., as well as a gain on sale of a branch property, branch restructuring, gain on sale of PPP loans, severance, and loss on extinguishment of debt:  

      Three Months Ended  Nine Months Ended  
         September 30, June 30, September 30, September 30, September 30, 
      2022 2022 2021 2022 2021 
    Reconciliation of Reported and Adjusted (non-GAAP) Net Income Available to Common Stockholders                
    Reported net income available to common stockholders $ 37,659  $36,663  $36,573  $ 107,032  $63,174  
    Adjustments to net income (1):                 
    Provision for credit losses - Non-PCD loans (double-count)   —   —   —    —   20,278  
    Gain on sale of PPP loans   —   —   —    —   (20,697) 
    Net gain on sale of securities and other assets   (1,397)  —   —    (1,397)  (710) 
    Loss on termination of derivatives   —   —   —    —   16,505  
    Severance   —   2,193   —    2,193   1,875  
    Loss on extinguishment of debt   —   740   —    740   1,751  
    Curtailment loss   —   —   —    —   1,543  
    Merger expenses and transaction costs (2)   —   —   2,472    —   42,250  
    Branch restructuring   —   —   4,518    —   6,177  
    Income tax effect of adjustments and other tax adjustments   440   (295)  (2,191)   145   (19,187) 
    Adjusted net income available to common stockholders (non-GAAP) $ 36,702  $39,301  $41,372  $ 108,713  $112,959  
                     
    Adjusted Ratios (Based upon non-GAAP as calculated above)                
    Adjusted EPS (Diluted) $ 0.95  $1.01  $1.01  $ 2.78  $2.90  
    Adjusted return on average assets   1.23 %   1.36 % 1.37 %  1.24 % 1.31 %
    Adjusted return on average equity   13.23   14.36   14.27    13.02   13.80  
    Adjusted return on average tangible common equity   16.72   18.30   18.02    16.45   17.44  
    Adjusted non-interest expense to average assets   1.53   1.60   1.56    1.58   1.54  
    Adjusted efficiency ratio   44.2   45.9   46.9    46.9   47.4  

    (1)  Adjustments to net income are taxed at the Company's statutory tax rate of approximately 31% unless otherwise noted.
    (2)  Certain merger expenses and transaction costs are non-taxable expense.


    The following table presents a reconciliation of operating expense as a percentage of average assets (as reported) and adjusted operating expense as a percentage of average assets (non-GAAP):

      Three Months Ended  Nine Months Ended
    		 
         September 30, June 30, September 30, September 30, September 30, 
      2022 2022 2021 2022 2021 
    Operating expense as a % of average assets - as reported  1.54 %  1.71 %  1.80 %   1.63 %  2.16 %
    Loss on extinguishment of debt —  (0.03) —   (0.01) (0.02) 
    Curtailment loss —  —  —  —  (0.02) 
    Severance —  (0.07) —   (0.02) (0.02) 
    Merger expenses and transaction costs —  —  (0.08) —  (0.47) 
    Branch restructuring —  —  (0.14) —  (0.07) 
    Amortization of other intangible assets  (0.01) (0.01) (0.02)  (0.02) (0.02) 
    Adjusted operating expense as a % of average assets (non-GAAP)  1.53  1.60  1.56   1.58  1.54  


    The following table presents a reconciliation of efficiency ratio (non-GAAP) and adjusted efficiency ratio (non-GAAP):

      Three Months Ended Nine Months Ended 
         September 30, June 30, September 30, September 30, September 30, 
      2022 2022 2021 2022 2021 
    Efficiency ratio - as reported (non-GAAP) (1)      44.0 %   49.1 % 54.3 %  48.1 %   65.3 %
    Non-interest expense - as reported $ 48,302  $51,838  $56,783  $ 150,028  $194,470  
    Severance   —   (2,193)  —    (2,193)  (1,875) 
    Merger expenses and transaction costs   —   —   (2,472)   —   (42,250) 
    Branch restructuring   —   —   (4,518)   —   (6,177) 
    Loss on extinguishment of debt   —   (740)  —    (740)  (1,751) 
    Curtailment loss   —   —   —    —   (1,543) 
    Amortization of other intangible assets   (431)  (430)  (715)   (1,447)  (1,907) 
    Adjusted non-interest expense (non-GAAP) $ 47,871  $48,475  $49,078  $ 145,648  $138,967  
    Net interest income - as reported $ 100,438  $93,512  $94,828  $ 283,059  $265,923  
    Non-interest income - as reported $ 9,362  $12,124  $9,728  $ 28,689  $31,889  
    Gain on sale of PPP loans   —   —   —    —   (20,697) 
    Net gain on sale of securities and other assets   (1,397)  —   —    (1,397)  (710) 
    Loss on termination of derivatives   —   —   —    —   16,505  
    Adjusted non-interest income (non-GAAP) $ 7,965  $12,124  $9,728  $ 27,292  $26,987  
    Adjusted total revenues for adjusted efficiency ratio (non-GAAP) $ 108,403  $105,636  $104,556  $ 310,351  $292,910  
    Adjusted efficiency ratio (non-GAAP) (2)    44.2 %   45.9 % 46.9 %  46.9 %   47.4 %

    (1)  The reported efficiency ratio is a non-GAAP measure calculated by dividing GAAP non-interest expense by the sum of GAAP net interest income and GAAP non-interest income.
    (2)  The adjusted efficiency ratio is a non-GAAP measure calculated by dividing adjusted non-interest expense by the sum of GAAP net interest income and adjusted non-interest income.


    The following table presents the tangible common equity to tangible assets, tangible equity to tangible assets, and tangible common book value per share calculations (non-GAAP):

         September 30,     June 30,     September 30,  
      2022 2022 2021 
    Reconciliation of Tangible Assets:          
    Total assets $ 12,885,903  $12,347,085  $12,364,381  
    Goodwill   (155,797)  (155,797)  (155,339) 
    Other intangible assets   (6,915)  (7,346)  (9,077) 
    Tangible assets (non-GAAP) $ 12,723,191  $12,183,942  $12,199,965  
               
    Reconciliation of Tangible Common Equity - Consolidated:          
    Total stockholders' equity $ 1,140,791  $1,140,522  $1,201,117  
    Goodwill   (155,797)  (155,797)  (155,339) 
    Other intangible assets   (6,915)  (7,346)  (9,077) 
    Tangible equity (non-GAAP)   978,079   977,379   1,036,701  
    Preferred stock, net   (116,569)  (116,569)  (116,569) 
    Tangible common equity (non-GAAP) $ 861,510  $860,810  $920,132  
               
    Tangible common equity (non-GAAP) $ 861,510  $860,810  $920,132  
    AOCI, net of deferred taxes   93,036   69,950   1,042  
    Tangible common equity excluding AOCI (non-GAAP) $ 954,546  $930,760  $921,174  
               
    Tangible equity (non-GAAP) $ 978,079  $977,379  $1,036,701  
    AOCI, net of deferred taxes   93,036   69,950   1,042  
    Tangible equity excluding AOCI (non-GAAP) $ 1,071,115  $1,047,329  $1,037,743  
               
    Common shares outstanding   38,572   38,769   40,715  
               
    Tangible common equity to tangible assets (non-GAAP)   6.77 %   7.07 % 7.54 %
    Tangible common equity excluding AOCI to tangible assets (non-GAAP)   7.45   7.60   7.55  
    Tangible equity to tangible assets (non-GAAP)   7.69   8.02   8.50  
    Tangible equity excluding AOCI to tangible assets (non-GAAP)   8.36   8.55   8.51  
               
    Book value per share $26.55  $26.41  $26.64  
    Tangible common book value per share (non-GAAP)  22.34   22.20   22.60  
    Tangible common book value per share excluding AOCI (non-GAAP)  24.75   24.01   22.63  

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