Amalgamated Financial Corp. (the “Company” or “Amalgamated”)
(Nasdaq: AMAL), the holding company for Amalgamated Bank (the
“Bank”), today announced financial results for the fourth quarter
ended December 31, 2022.
Fourth Quarter 2022 Highlights (on a linked quarter
basis)
- Net income of $24.8 million, or
$0.80 per diluted share, compared to $22.9 million, or $0.74 per
diluted share.
- Core net income excluding the
impact of solar tax equity investments (non-GAAP)1 was $27.2
million, or $0.87 per diluted share, as compared to $24.8 million,
or $0.80 per diluted share.
- Average cost of deposits of 34
basis points for the quarter, where non-interest-bearing deposits
comprised 51% of total deposits.
- Loans receivable, net of allowance
and deferred fees and costs, increased $231.8 million, or 6.1%, to
$4.1 billion.
- PACE assessments grew $55.2 million
to $911.9 million, comprised of a $34.6 million increase in
commercial and a $20.6 million increase in residential.
- Net interest income was level at
$67.3 million compared to $67.6 million, while net interest margin
grew by 6 basis points to 3.56%, compared to 3.50%.
Full Year 2022 Highlights (from year end
2021)
- Net income of $81.5 million, or
$2.61 per diluted share, compared to $52.9 million, or $1.68 per
diluted share.
- Core net income excluding the
impact of solar tax equity investments (non-GAAP)1 was $87.2
million, or $2.79 per diluted share, as compared to $55.1 million,
or $1.75 per diluted share, or an increase of 58.3%.
- Total deposits increased by $238.8
million, or 3.76% to $6.6 billion, with a peak balance of $7.4
billion in August leading up to the congressional elections held in
November.
- Loans receivable, net of allowance
and deferred fees and costs, increased $784.6 million, or 23.9%, to
$4.1 billion.
- Net interest income increased $65.5
million or 37.6%, to $239.8 million compared to $174.3
million.
- Nonaccrual loans decreased to $21.7
million or 0.5% of total loans compared to $28.2 million or 0.9% of
total loans.
- Credit quality improved as
classified or criticized assets declined by $125.3 million or
54.3% to $105.6 million.
- Regulatory capital remains above
bank “well capitalized” standards.
Priscilla Sims Brown, President and Chief
Executive Officer, commented, “Our record fourth quarter and full
year 2022 results reflect the successful execution of the strategy
that we outlined eighteen months ago. A strategy that
was designed to accelerate loan growth, improve our profitability,
and drive earnings as we strived to be the most improved bank in
the country for financial metrics. I am proud to say
that our full year 2022 results have exceeded our expectations as
we grew our loan portfolio 23.9%, improved our return on average
assets 24 bps to 1.05% and increased diluted earnings per share 56%
to $2.61. With these results and momentum, I am excited to lead our
Bank into its next centennial and I am delighted to honor the women
and men who have shaped Amalgamated’s 100 year-old history.”
Fourth Quarter Earnings
Net income for the fourth quarter of 2022 was $24.8 million, or
$0.80 per diluted share, compared to $22.9 million, or $0.74 per
diluted share, for the third quarter of 2022. The $1.9 million
increase for the fourth quarter of 2022 was primarily due to an
$0.7 million decrease in non-interest expense, a $0.9 million
decrease in provision for loan losses, and a $1.3 million decrease
in income tax expense related to an elected change in taxable
income recognition, offset by a $0.3 million decrease in net
interest income, a $0.8 million decrease in non-interest
income.
Core net income excluding the impact of solar
tax equity investments (non-GAAP)1 for the fourth quarter of 2022
was $27.2 million, or $0.87 per diluted share, compared to $24.8
million, or $0.80 per diluted share, for the third quarter of 2022.
Excluded from core net income for the fourth quarter of 2022 was
$1.4 million of pre-tax losses on the sale of securities and $1.7
million of accelerated depreciation from our solar tax equity
investments. Excluded from the third quarter of 2022 was $1.8
million of pre-tax losses on the sale of securities, $0.6 million
of pre-tax gains on subordinated debt repurchases, and $1.3 million
of accelerated depreciation from our solar tax investments.
Presentation excluding the temporary effect of
the tax credits and accelerated depreciation of our solar tax
equity investments isolates the financial statement volatility
associated with these investments.
Net interest income was $67.3 million for the
fourth quarter of 2022, compared to $67.6 million for the third
quarter of 2022. The $0.3 million decrease from the preceding
quarter reflected increased interest expense on deposits of $3.2
million driven by a 40 basis point increase in interest-bearing
deposit costs, and $4.8 million in increased interest expense from
borrowings, primarily related to interest expense on Federal Home
Loan Bank advances. The increase in interest expense was offset by
higher interest income on securities of $4.0 million, driven by a
73 basis point increase in securities yield, and loan interest
income which increased by $4.2 million, driven by a $283.9 million
increase in average loan balance, and a 13 basis point increase in
loan yields.
Net interest margin was 3.56% for the fourth
quarter of 2022, an increase of six basis points from 3.50% in the
third quarter of 2022. Increases in yields on interest-earning
assets were offset by increased rates and average balances of
interest-bearing liabilities, particularly due to an increase in
Federal Home Loan Bank advances. Prepayment penalties earned in
loan income contributed one basis point to our net interest margin
in the fourth quarter of 2022, compared to four basis points in the
third quarter of 2022.
Provision for loan losses totaled an expense of
$4.4 million for the fourth quarter of 2022 compared to an expense
of $5.4 million in the third quarter of 2022. The decrease in
provision expense in the fourth quarter of 2022 was primarily
related to $1.6 million in charge-offs related to nonperforming
loans that were transferred to held for sale in the previous
quarter and subsequently sold in the current quarter. Adjusted, our
provision for loan losses in the current quarter increased by $0.6
million related to higher loan balances, increases in certain
specific reserves, and elevated charge-offs in consumer solar
loans.
Core non-interest income excluding the impact of
solar tax equity investments (non-GAAP)1 was $7.3 million for the
fourth quarter of 2022, compared to $7.5 million in the third
quarter of 2022. The decrease of $0.2 million was primarily driven
by slightly lower Trust Department fees, a $0.2 million loss on the
disposition of other real estate owned, and a $0.6 million loss on
the sale of nonperforming held for sale loans, mostly offset by
increased business banking fees and one-time beneficiary income on
bank-owned life insurance.
Core non-interest expense (non-GAAP)1 for the
fourth quarter of 2022 was $35.6 million, a decrease of $0.7
million from the third quarter of 2022. This was primarily driven
by a $1.5 million decrease in professional fees, offset by a $0.5
million increase in advertising and promotion expense, and
increased other expenses related to recruiting services.
Our provision for income tax expense was $6.8
million for the fourth quarter of 2022, compared to $8.1 million
for the third quarter of 2022. Our effective tax rate for the
fourth quarter of 2022 was 21.6%, compared to 26.0% for the third
quarter of 2022. The decrease in tax expense was related to an
elected change in taxable income recognition. Without the change in
election, our effective tax rate was 26.1%.
Balance Sheet Quarterly
Summary
Total assets were $7.8 billion at
December 31, 2022, compared to $7.9 billion at September 30,
2022. Notable changes within individual balance sheet line items
include a $96.1 million decrease in investment securities, $231.8
million increase in loans receivable, net, a $167.1 million
decrease in resell agreements, a $565.3 million decrease in
deposits, and an increase in borrowed funds of $505.0 million.
Total loans receivable, net of allowance and
deferred fees and costs, at December 31, 2022 were $4.1
billion, an increase of $231.8 million, or 6.1%, compared to
September 30, 2022. The increase in loans is primarily driven by a
$120.6 million increase in commercial and industrial loans, an
$82.7 million increase in multifamily loans, and a $39.8 million
increase in residential loans, offset by a $3.8 million decrease in
consumer and other loans, a $1.3 million decrease in construction
and land development loans, and a $2.9 million decrease in
commercial real estate loans as we continue to reduce that asset
class exposure. Our continued focus on credit quality improvement
resulted in $12.7 million of payoffs of criticized or classified
loans in the quarter.
Deposits at December 31, 2022 were $6.6
billion, a decrease of $565.3 million, or 7.9%, as compared to $7.2
billion as of September 30, 2022. Deposits held by politically
active customers, such as campaigns, PACs, advocacy-based
organizations, and state and national party committees were $643.6
million as of December 31, 2022, a decrease of $513.7 million
compared to $1.2 billion as of September 30, 2022. The decline in
political deposits is related to the conclusion of congressional
elections in the fourth quarter of 2022 and is in-line with
expectations we shared in the previous quarter.
Non-interest-bearing deposits represent 53% of
average deposits and 51% of ending deposits for the quarter ended
December 31, 2022, contributing to an average cost of deposits
of 34 basis points in the fourth quarter of 2022.
Nonperforming assets totaled $34.8 million, or
0.4% of period-end total assets at December 31, 2022, a
decrease of $19.5 million, compared with $54.3 million, or 0.7% on
a linked quarter basis. The decrease in nonperforming assets was
primarily driven by the sale of $10.2 million of restructured loans
held for sale, and $12.7 million in payoffs of criticized or
classified loans.
The allowance for loan losses increased $2.9
million to $45.0 million at December 31, 2022 from $42.1
million at September 30, 2022, primarily due to higher loan
balances. At December 31, 2022, we had $27.8 million of
impaired loans for which a specific allowance of $5.7 million was
made, compared to $38.2 million of impaired loans at September 30,
2022 for which a specific allowance of $5.2 million was made. The
ratio of allowance to total loans was 1.10% at December 31,
2022 and 1.09% at September 30, 2022.
Capital Quarterly Summary
As of December 31, 2022, our Common Equity
Tier 1 Capital Ratio was 11.82%, Total Risk-Based Capital Ratio was
14.28%, and Tier-1 Leverage Capital Ratio was 7.52%, compared to
11.91%, 14.43% and 7.16%, respectively, as of September 30, 2022.
Stockholders’ equity at December 31, 2022 was $509.0 million,
compared to $487.7 million at September 30, 2022. The increase in
stockholders’ equity was primarily driven by $24.8 million of
net income, partially offset by $3.2 million in dividends. There
was no significant change during the quarter to the accumulated
other comprehensive loss due to the tax effected mark-to-market on
our securities portfolio.
Our tangible book value per share (non-GAAP)1
was $16.05 as of December 31, 2022 compared to $15.37 as of
September 30, 2022, primarily a result of $24.8 million of net
income in the quarter. Tangible common equity (non-GAAP)1 was 6.30%
of tangible assets, compared to 6.00% as of September 30, 2022.
Conference Call
As previously announced, Amalgamated Financial
Corp. will host a conference call to discuss its fourth quarter
results today, January 26, 2023 at 11:00am (Eastern Time). The
conference call can be accessed by dialing 1-877-407-9716
(domestic) or 1-201-493-6779 (international) and asking for the
Amalgamated Financial Corp. Fourth Quarter 2022 Earnings Call. A
telephonic replay will be available approximately two hours after
the call and can be accessed by dialing 1-844-512-2921, or for
international callers 1-412-317-6671 and providing the access code
13733696. The telephonic replay will be available until February 2,
2023.
Interested investors and other parties may also
listen to a simultaneous webcast of the conference call by logging
onto the investor relations section of our website at
http://ir.amalgamatedbank.com/. The online replay will remain
available for a limited time beginning immediately following the
call.
The presentation materials for the call can be
accessed on the investor relations section of our website at
https://ir.amalgamatedbank.com/.
About Amalgamated Financial
Corp.
Amalgamated Financial Corp. is a Delaware public
benefit corporation and a bank holding company engaged in
commercial banking and financial services through its wholly-owned
subsidiary, Amalgamated Bank. Amalgamated Bank is a New York-based
full-service commercial bank and a chartered trust company with a
combined network of five branches across New York City, Washington
D.C., and San Francisco, and a commercial office in Boston.
Amalgamated Bank was formed in 1923 as Amalgamated Bank of New York
by the Amalgamated Clothing Workers of America, one of the
country’s oldest labor unions. Amalgamated Bank provides commercial
banking and trust services nationally and offers a full range of
products and services to both commercial and retail customers.
Amalgamated Bank is a proud member of the Global Alliance for
Banking on Values and is a certified B Corporation®. As of
December 31, 2022, our total assets were $7.8 billion, total
net loans were $4.1 billion, and total deposits were $6.6 billion.
Additionally, as of December 31, 2022, our trust business held
$38.1 billion in assets under custody and $13.4 billion in assets
under management.
Non-GAAP Financial Measures
This release (and the accompanying financial
information and tables) refers to certain non-GAAP financial
measures including, without limitation, “Core operating revenue,”
“Core non-interest expense,” “Core net income,” “Tangible common
equity,” “Average tangible common equity,” “Core return on average
assets,” “Core return on average tangible common equity,” and “Core
efficiency ratio.”
Our management utilizes this information to
compare our operating performance for December 31, 2022 versus
certain periods in 2022 and 2021 and to prepare internal
projections. We believe these non-GAAP financial measures
facilitate making period-to-period comparisons and are meaningful
indications of our operating performance. In addition, because
intangible assets such as goodwill and other discrete items
unrelated to our core business, which are excluded, vary
extensively from company to company, we believe that the
presentation of this information allows investors to more easily
compare our results to those of other companies.
The presentation of non-GAAP financial
information, however, is not intended to be considered in isolation
or as a substitute for GAAP financial measures. We strongly
encourage readers to review the GAAP financial measures included in
this release and not to place undue reliance upon any single
financial measure. In addition, because non-GAAP financial measures
are not standardized, it may not be possible to compare the
non-GAAP financial measures presented in this release with other
companies’ non-GAAP financial measures having the same or similar
names. Reconciliations of non-GAAP financial disclosures to
comparable GAAP measures found in this release are set forth in the
final pages of this release and also may be viewed on our website,
amalgamatedbank.com.
Terminology
Certain terms used in this release are defined as follows:
“Core efficiency ratio” is defined as “Core non-interest
expense” divided by “Core operating revenue.” We believe the most
directly comparable performance ratio derived from GAAP financial
measures is an efficiency ratio calculated by dividing total
non-interest expense by the sum of net interest income and total
non-interest income.
“Core efficiency ratio excluding solar tax impact” is defined as
“Core non-interest expense” divided by “Core operating revenue
excluding solar tax impact.” We believe the most directly
comparable performance ratio derived from GAAP financial measures
is an efficiency ratio calculated by dividing total non-interest
expense by the sum of net interest income and total non-interest
income.
“Core net income” is defined as net income after tax excluding
gains and losses on sales of securities, gains on the sale of owned
property, costs related to branch closures, restructuring/severance
costs, acquisition costs, and taxes on notable pre-tax items. We
believe the most directly comparable GAAP financial measure is net
income.
“Core net income excluding solar tax impact” is defined as net
income after tax excluding gains and losses on sales of securities,
gains on the sale of owned property, costs related to branch
closures, restructuring/severance costs, acquisition costs, tax
credits and accelerated depreciation on solar equity investments,
and taxes on notable pre-tax items. We believe the most directly
comparable GAAP financial measure is net income.
“Core non-interest expense” is defined as total non-interest
expense excluding costs related to branch closures,
restructuring/severance, and acquisitions. We believe the most
directly comparable GAAP financial measure is total non-interest
expense.
“Core non-interest income excluding the impact of solar tax
equity investments” is defined as total non-interest income
excluding gains and losses on sales of securities, gains on the
sale of owned property, and tax credits and depreciation on solar
equity investments. We believe the most directly comparable GAAP
financial measure is non-interest income.
“Core operating revenue” is defined as total net interest income
plus “core non-interest income”, defined as non-interest income
excluding gains and losses on sales of securities and gains on the
sale of owned property. We believe the most directly comparable
GAAP financial measure is the total of net interest income and
non-interest income.
“Core operating revenue excluding solar tax impact” is defined
as total net interest income plus non-interest income excluding
gains and losses on sales of securities, gains on the sale of owned
property, and tax credits and depreciation on solar equity
investments. We believe the most directly comparable GAAP financial
measure is the total of net interest income and non-interest
income.
“Core return on average assets” is defined as “Core net income”
divided by average total assets. We believe the most directly
comparable performance ratio derived from GAAP financial measures
is return on average assets calculated by dividing net income by
average total assets.“Core return on average assets excluding solar
tax impact” is defined as “Core net income excluding solar tax
impact” divided by average total assets. We believe the most
directly comparable performance ratio derived from GAAP financial
measures is return on average assets calculated by dividing net
income by average total assets.
“Core return on average tangible common equity” is defined as
“Core net income” divided by “Average tangible common equity.” We
believe the most directly comparable performance ratio derived from
GAAP financial measures is return on average equity calculated by
dividing net income by average total stockholders’ equity.
“Core return on average tangible common equity excluding solar
tax impact” is defined as “Core net income excluding solar tax
impact” divided by “Average tangible common equity.” We believe the
most directly comparable performance ratio derived from GAAP
financial measures is return on average equity calculated by
dividing net income by average total stockholders’ equity.
“Tangible assets” are defined as total assets excluding, as
applicable, goodwill and core deposit intangibles. We believe the
most directly comparable GAAP financial measure is total
assets.
“Tangible common equity”, and “Tangible book value” are defined
as stockholders’ equity excluding, as applicable, minority
interests, preferred stock, goodwill and core deposit intangibles.
We believe that the most directly comparable GAAP financial measure
is total stockholders’ equity.
Forward-Looking Statements
Statements included in this release that are not
historical in nature are intended to be, and are hereby identified
as, forward-looking statements within the meaning of the Private
Securities Litigation Reform Act, Section 21E of the Securities
Exchange Act of 1934, as amended. Forward-looking statements
generally can be identified through the use of forward-looking
terminology such as “may,” “will,” “anticipate,” “should,” “would,”
“believe,” “contemplate,” “expect,” “estimate,” “continue,” “in the
future,” “may” and “intend,” as well as other similar words and
expressions of the future. Forward-looking statements are subject
to known and unknown risks, uncertainties and other factors, any or
all of which could cause actual results to differ materially from
the results expressed or implied by such forward-looking
statements. These risks and uncertainties include, but are not
limited to: (i) deterioration in the financial condition of
borrowers resulting in significant increases in loan losses and
provisions for those losses; (ii) continued fluctuation of the
interest rate environment; (iii) our inability to maintain the
historical growth rate of the loan portfolio; (iv) changes in loan
underwriting, credit review or loss reserve policies associated
with economic conditions, examination conclusions, or regulatory
developments; (v) the impact of competition with other financial
institutions, including pricing pressures and the resulting impact
on our results, including as a result of compression to net
interest margin; (vi) greater than anticipated adverse conditions
in the national or local economies including in our core markets,
which may have an adverse impact on our business, operations and
performance, and could have a negative impact on our credit
portfolio, share price, and borrowers; (vii) fluctuations or
unanticipated changes in interest rates on loans or deposits or
that affect the yield curve; (viii) any matter that would cause us
to conclude that there was impairment of any asset, including
intangible assets; (ix) the results of regulatory examinations; (x)
potential deterioration in real estate values; (xi) changes in
legislation, regulation, policies, or administrative practices,
whether by judicial, governmental, or legislative action; (xii) the
risk that the preliminary financial information reported herein and
our current preliminary analysis will be different when our review
is finalized; (xiii) increased competition for experienced
executives in the banking industry; (xiv) a failure in or breach of
our operational or security systems or infrastructure, or those of
third party vendors or other service providers, including as a
result of unauthorized access, computer viruses, phishing schemes,
spam attacks, human error, natural disasters, power loss and other
security breaches; and (xv) the outcome of any legal or regulatory
proceedings that may be instituted against us; and (xvi) physical
and transitional risks related to climate change as they impact our
business and the businesses that we finance. Additional factors
which could affect the forward-looking statements can be found in
our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q,
and Current Reports on Form 8-K filed with the SEC and available on
the SEC's website at https://www.sec.gov/. We disclaim any
obligation to update or revise any forward-looking statements
contained in this release, which speak only as of the date hereof,
whether as a result of new information, future events or otherwise,
except as required by law.
Investor Contact:Jamie LillisSolebury Strategic
Communicationsshareholderrelations@amalgamatedbank.com
800-895-4172
Consolidated Statements of Income
|
Three Months Ended |
|
Year Ended |
|
December 31, |
|
September 30, |
|
December 31, |
|
December 31, |
($ in thousands) |
|
2022 |
|
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
INTEREST AND DIVIDEND
INCOME |
(unaudited) |
|
(unaudited) |
|
(unaudited) |
|
(unaudited) |
|
|
Loans |
$ |
42,492 |
|
|
$ |
38,264 |
|
|
$ |
32,138 |
|
|
$ |
145,649 |
|
|
$ |
123,318 |
|
Securities |
|
35,567 |
|
|
|
31,580 |
|
|
|
16,549 |
|
|
|
110,654 |
|
|
|
56,557 |
|
Interest-bearing deposits in banks |
|
485 |
|
|
|
971 |
|
|
|
200 |
|
|
|
2,186 |
|
|
|
651 |
|
Total interest and dividend income |
|
78,544 |
|
|
|
70,815 |
|
|
|
48,887 |
|
|
|
258,489 |
|
|
|
180,526 |
|
INTEREST EXPENSE |
|
|
|
|
|
|
|
|
|
Deposits |
|
5,682 |
|
|
|
2,491 |
|
|
|
1,407 |
|
|
|
11,056 |
|
|
|
5,823 |
|
Borrowed funds |
|
5,516 |
|
|
|
696 |
|
|
|
399 |
|
|
|
7,593 |
|
|
|
399 |
|
Total interest expense |
|
11,198 |
|
|
|
3,187 |
|
|
|
1,806 |
|
|
|
18,649 |
|
|
|
6,222 |
|
NET INTEREST INCOME |
|
67,346 |
|
|
|
67,628 |
|
|
|
47,081 |
|
|
|
239,840 |
|
|
|
174,304 |
|
Provision for (recovery of) loan losses |
|
4,434 |
|
|
|
5,363 |
|
|
|
3,568 |
|
|
|
15,002 |
|
|
|
(287 |
) |
Net interest income after provision for loan losses |
|
62,912 |
|
|
|
62,265 |
|
|
|
43,513 |
|
|
|
224,838 |
|
|
|
174,591 |
|
NON-INTEREST INCOME |
|
|
|
|
|
|
|
|
|
Trust Department fees |
|
3,607 |
|
|
|
3,872 |
|
|
|
2,881 |
|
|
|
14,449 |
|
|
|
13,352 |
|
Service charges on deposit accounts |
|
2,991 |
|
|
|
2,735 |
|
|
|
2,414 |
|
|
|
10,999 |
|
|
|
9,355 |
|
Bank-owned life insurance |
|
986 |
|
|
|
785 |
|
|
|
530 |
|
|
|
3,868 |
|
|
|
2,388 |
|
Gain (loss) on sale of securities |
|
(1,373 |
) |
|
|
(1,844 |
) |
|
|
(106 |
) |
|
|
(3,637 |
) |
|
|
649 |
|
Gain (loss) on sale of loans, net |
|
(578 |
) |
|
|
(367 |
) |
|
|
181 |
|
|
|
(610 |
) |
|
|
1,887 |
|
Gain (loss) on other real estate owned, net |
|
(168 |
) |
|
|
— |
|
|
|
— |
|
|
|
(168 |
) |
|
|
(407 |
) |
Equity method investments |
|
(1,416 |
) |
|
|
(1,151 |
) |
|
|
5,870 |
|
|
|
(2,773 |
) |
|
|
150 |
|
Other |
|
177 |
|
|
|
973 |
|
|
|
591 |
|
|
|
1,769 |
|
|
|
1,015 |
|
Total non-interest income |
|
4,226 |
|
|
|
5,003 |
|
|
|
12,361 |
|
|
|
23,897 |
|
|
|
28,389 |
|
NON-INTEREST EXPENSE |
|
|
|
|
|
|
|
|
|
Compensation and employee benefits |
|
19,470 |
|
|
|
19,527 |
|
|
|
17,359 |
|
|
|
74,712 |
|
|
|
69,844 |
|
Occupancy and depreciation |
|
3,345 |
|
|
|
3,481 |
|
|
|
3,730 |
|
|
|
13,723 |
|
|
|
14,023 |
|
Professional fees |
|
1,684 |
|
|
|
3,173 |
|
|
|
3,742 |
|
|
|
10,417 |
|
|
|
12,961 |
|
Data processing |
|
4,072 |
|
|
|
4,149 |
|
|
|
5,194 |
|
|
|
17,732 |
|
|
|
16,042 |
|
Office maintenance and depreciation |
|
696 |
|
|
|
807 |
|
|
|
695 |
|
|
|
3,012 |
|
|
|
3,057 |
|
Amortization of intangible assets |
|
262 |
|
|
|
262 |
|
|
|
302 |
|
|
|
1,047 |
|
|
|
1,207 |
|
Advertising and promotion |
|
1,331 |
|
|
|
795 |
|
|
|
982 |
|
|
|
3,741 |
|
|
|
3,230 |
|
Other |
|
4,710 |
|
|
|
4,064 |
|
|
|
3,028 |
|
|
|
16,187 |
|
|
|
11,891 |
|
Total non-interest expense |
|
35,570 |
|
|
|
36,258 |
|
|
|
35,032 |
|
|
|
140,571 |
|
|
|
132,255 |
|
Income before income
taxes |
|
31,568 |
|
|
|
31,010 |
|
|
|
20,842 |
|
|
|
108,164 |
|
|
|
70,725 |
|
Income tax expense (benefit) |
|
6,813 |
|
|
|
8,066 |
|
|
|
4,918 |
|
|
|
26,687 |
|
|
|
17,788 |
|
Net income |
|
24,755 |
|
|
|
22,944 |
|
|
|
15,924 |
|
|
|
81,477 |
|
|
|
52,937 |
|
Earnings per common share -
basic |
$ |
0.81 |
|
|
$ |
0.75 |
|
|
$ |
0.51 |
|
|
$ |
2.64 |
|
|
$ |
1.70 |
|
Earnings per common share -
diluted |
$ |
0.80 |
|
|
$ |
0.74 |
|
|
$ |
0.50 |
|
|
$ |
2.61 |
|
|
$ |
1.68 |
|
|
|
|
|
|
|
|
|
|
|
Consolidated Statements of Financial
Condition
($ in thousands) |
December 31,2022 |
|
September 30, 2022 |
|
December 31, 2021 |
Assets |
(unaudited) |
|
(unaudited) |
|
|
Cash and due from banks |
$ |
5,110 |
|
|
$ |
3,404 |
|
|
$ |
8,622 |
|
Interest-bearing deposits in
banks |
|
58,430 |
|
|
|
62,819 |
|
|
|
321,863 |
|
Total cash and cash equivalents |
|
63,540 |
|
|
|
66,223 |
|
|
|
330,485 |
|
Securities: |
|
|
|
|
|
Available for sale, at fair value |
|
1,812,476 |
|
|
|
1,957,486 |
|
|
|
2,113,410 |
|
Held-to-maturity, at amortized cost |
|
1,541,301 |
|
|
|
1,492,423 |
|
|
|
843,569 |
|
Loans held for sale |
|
7,943 |
|
|
|
17,916 |
|
|
|
3,279 |
|
Loans receivable, net of deferred
loan origination costs |
|
4,106,002 |
|
|
|
3,871,290 |
|
|
|
3,312,224 |
|
Allowance for loan losses |
|
(45,031 |
) |
|
|
(42,122 |
) |
|
|
(35,866 |
) |
Loans receivable, net |
|
4,060,971 |
|
|
|
3,829,168 |
|
|
|
3,276,358 |
|
|
|
|
|
|
|
Resell agreements |
|
25,754 |
|
|
|
192,834 |
|
|
|
229,018 |
|
Accrued interest and dividends
receivable |
|
41,441 |
|
|
|
34,767 |
|
|
|
28,820 |
|
Premises and equipment, net |
|
9,856 |
|
|
|
10,539 |
|
|
|
11,735 |
|
Bank-owned life insurance |
|
105,624 |
|
|
|
105,915 |
|
|
|
107,266 |
|
Right-of-use lease asset |
|
28,236 |
|
|
|
29,991 |
|
|
|
33,115 |
|
Deferred tax asset |
|
62,507 |
|
|
|
64,046 |
|
|
|
26,719 |
|
Goodwill |
|
12,936 |
|
|
|
12,936 |
|
|
|
12,936 |
|
Other intangible assets |
|
3,105 |
|
|
|
3,366 |
|
|
|
4,151 |
|
Equity investments |
|
8,305 |
|
|
|
7,683 |
|
|
|
6,856 |
|
Other assets |
|
59,129 |
|
|
|
42,924 |
|
|
|
50,159 |
|
Total assets |
$ |
7,843,124 |
|
|
$ |
7,868,217 |
|
|
$ |
7,077,876 |
|
Liabilities |
|
|
|
|
|
Deposits |
$ |
6,595,037 |
|
|
$ |
7,160,307 |
|
|
$ |
6,356,255 |
|
Subordinated debt |
|
77,708 |
|
|
|
77,679 |
|
|
|
83,831 |
|
Borrowed funds |
|
580,000 |
|
|
|
75,000 |
|
|
|
— |
|
Operating leases |
|
40,779 |
|
|
|
43,229 |
|
|
|
48,160 |
|
Other liabilities |
|
40,645 |
|
|
|
24,264 |
|
|
|
25,755 |
|
Total liabilities |
$ |
7,334,169 |
|
|
$ |
7,380,479 |
|
|
$ |
6,514,001 |
|
|
|
|
|
|
|
Stockholders’
equity |
|
|
|
|
|
Common stock, par value $.01 per
share |
|
307 |
|
|
|
307 |
|
|
|
311 |
|
Additional paid-in capital |
|
286,947 |
|
|
|
286,431 |
|
|
|
297,975 |
|
Retained earnings |
|
330,275 |
|
|
|
308,743 |
|
|
|
260,047 |
|
Accumulated other comprehensive
income (loss), net of income taxes |
|
(108,707 |
) |
|
|
(107,876 |
) |
|
|
5,409 |
|
Total Amalgamated Financial Corp. stockholders' equity |
|
508,822 |
|
|
|
487,605 |
|
|
|
563,742 |
|
Noncontrolling interests |
|
133 |
|
|
|
133 |
|
|
|
133 |
|
Total stockholders' equity |
|
508,955 |
|
|
|
487,738 |
|
|
|
563,875 |
|
Total liabilities and stockholders’ equity |
$ |
7,843,124 |
|
|
$ |
7,868,217 |
|
|
$ |
7,077,876 |
|
|
|
|
|
|
|
Select Financial Data
|
As of and for the |
|
As of and for the |
|
Three Months Ended |
|
Year Ended |
|
December 31, |
|
September 30, |
|
December 31, |
|
December 31, |
(Shares in thousands) |
|
2022 |
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
Selected Financial
Ratios and Other Data: |
|
|
|
|
|
|
|
|
|
Earnings per share |
|
|
|
|
|
|
|
|
|
Basic |
$ |
0.81 |
|
$ |
0.75 |
|
$ |
0.51 |
|
$ |
2.64 |
|
$ |
1.70 |
Diluted |
|
0.80 |
|
|
0.74 |
|
|
0.50 |
|
|
2.61 |
|
|
1.68 |
Core net income
(non-GAAP) |
|
|
|
|
|
|
|
|
|
Basic |
$ |
0.84 |
|
$ |
0.78 |
|
$ |
0.54 |
|
$ |
2.74 |
|
$ |
1.75 |
Diluted |
|
0.83 |
|
|
0.77 |
|
|
0.53 |
|
|
2.70 |
|
|
1.72 |
Core net income excluding solar
tax impact (non-GAAP) |
|
|
|
|
|
|
|
|
|
Basic |
$ |
0.89 |
|
$ |
0.81 |
|
$ |
0.41 |
|
$ |
2.83 |
|
$ |
1.77 |
Diluted |
|
0.87 |
|
|
0.80 |
|
|
0.40 |
|
|
2.79 |
|
|
1.75 |
Book value per common share
(excluding minority interest) |
|
16.57 |
|
|
15.90 |
|
|
18.11 |
|
|
16.57 |
|
|
18.11 |
Tangible book value per share
(non-GAAP) |
|
16.05 |
|
|
15.37 |
|
|
17.56 |
|
|
16.05 |
|
|
17.56 |
Common shares outstanding, par
value $.01 per share(1) |
|
30,700 |
|
|
30,672 |
|
|
31,130 |
|
|
30,700 |
|
|
31,130 |
Weighted average common shares
outstanding, basic |
|
30,679 |
|
|
30,673 |
|
|
31,108 |
|
|
30,818 |
|
|
31,104 |
Weighted average common shares
outstanding, diluted |
|
31,055 |
|
|
31,032 |
|
|
31,516 |
|
|
31,193 |
|
|
31,512 |
|
|
|
|
|
|
|
|
|
|
(1) 70,000,000
shares authorized; 30,700,198, 30,672,303, and 31,130,143 shares
issued and outstanding, respectively, for the periods ended
December 31, 2022, September 30, 2022, and December 31, 2021. |
Select Financial Data
|
As of and for the |
|
As of and for the |
|
Three Months Ended |
|
Year Ended |
|
December 31, |
|
September 30, |
|
December 31, |
|
December 31, |
|
2022 |
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
Selected Performance
Metrics: |
|
|
|
|
|
|
|
|
|
Return on average assets |
1.26 |
% |
|
1.15 |
% |
|
0.90 |
% |
|
1.05 |
% |
|
0.81 |
% |
Core return on average assets
(non-GAAP) |
1.31 |
% |
|
1.19 |
% |
|
0.95 |
% |
|
1.09 |
% |
|
0.83 |
% |
Core return on average assets
excluding solar tax impact (non-GAAP) |
1.38 |
% |
|
1.24 |
% |
|
0.72 |
% |
|
1.13 |
% |
|
0.84 |
% |
Return on average equity |
19.89 |
% |
|
17.79 |
% |
|
11.23 |
% |
|
15.65 |
% |
|
9.59 |
% |
Core return on average
tangible common equity (non-GAAP) |
21.47 |
% |
|
19.11 |
% |
|
12.20 |
% |
|
16.73 |
% |
|
10.16 |
% |
Core return on average
tangible common equity excluding solar tax impact (non-GAAP) |
22.58 |
% |
|
19.88 |
% |
|
9.23 |
% |
|
17.30 |
% |
|
10.31 |
% |
Average equity to average
assets |
6.32 |
% |
|
6.44 |
% |
|
8.02 |
% |
|
6.74 |
% |
|
8.40 |
% |
Tangible common equity to
tangible assets |
6.30 |
% |
|
6.00 |
% |
|
7.74 |
% |
|
6.30 |
% |
|
7.74 |
% |
Loan yield |
4.24 |
% |
|
4.11 |
% |
|
4.01 |
% |
|
4.03 |
% |
|
3.88 |
% |
Securities yield |
4.08 |
% |
|
3.35 |
% |
|
2.20 |
% |
|
3.14 |
% |
|
2.22 |
% |
Deposit cost |
0.34 |
% |
|
0.14 |
% |
|
0.09 |
% |
|
0.16 |
% |
|
0.10 |
% |
Net interest margin |
3.56 |
% |
|
3.50 |
% |
|
2.77 |
% |
|
3.22 |
% |
|
2.77 |
% |
Efficiency ratio(1) |
49.70 |
% |
|
49.92 |
% |
|
58.94 |
% |
|
53.30 |
% |
|
65.25 |
% |
Core efficiency ratio
(non-GAAP)(1) |
48.76 |
% |
|
49.09 |
% |
|
57.18 |
% |
|
52.42 |
% |
|
64.24 |
% |
Core efficiency ratio
excluding solar tax impact (non-GAAP) |
47.65 |
% |
|
48.24 |
% |
|
62.81 |
% |
|
51.68 |
% |
|
63.90 |
% |
|
|
|
|
|
|
|
|
|
|
Asset Quality
Ratios: |
|
|
|
|
|
|
|
|
|
Nonaccrual loans to total
loans |
0.53 |
% |
|
0.51 |
% |
|
0.85 |
% |
|
0.53 |
% |
|
0.85 |
% |
Nonperforming assets to total
assets |
0.44 |
% |
|
0.69 |
% |
|
0.77 |
% |
|
0.44 |
% |
|
0.77 |
% |
Allowance for loan losses to
nonaccrual loans |
207.53 |
% |
|
212.51 |
% |
|
127.10 |
% |
|
207.53 |
% |
|
127.10 |
% |
Allowance for loan losses to
total loans |
1.10 |
% |
|
1.09 |
% |
|
1.08 |
% |
|
1.10 |
% |
|
1.08 |
% |
Annualized net charge-offs
(recoveries) to average loans |
0.15 |
% |
|
0.29 |
% |
|
0.44 |
% |
|
0.16 |
% |
|
0.17 |
% |
|
|
|
|
|
|
|
|
|
|
Capital
Ratios: |
|
|
|
|
|
|
|
|
|
Tier 1 leverage capital
ratio |
7.52 |
% |
|
7.16 |
% |
|
7.62 |
% |
|
7.52 |
% |
|
7.62 |
% |
Tier 1 risk-based capital
ratio |
11.82 |
% |
|
11.91 |
% |
|
12.98 |
% |
|
11.82 |
% |
|
12.98 |
% |
Total risk-based capital
ratio |
14.28 |
% |
|
14.43 |
% |
|
15.95 |
% |
|
14.28 |
% |
|
15.95 |
% |
Common equity tier 1 capital
ratio |
11.82 |
% |
|
11.91 |
% |
|
12.98 |
% |
|
11.82 |
% |
|
12.98 |
% |
|
|
|
|
|
|
|
|
|
|
(1) Efficiency
ratio is calculated by dividing total non-interest expense by the
sum of net interest income and total non-interest income |
Loan and Held-to-Maturity Securities Portfolio
Composition
(In thousands) |
At December 31, 2022 |
|
At September 30, 2022 |
|
At December 31, 2021 |
|
Amount |
|
% of total loans |
|
Amount |
|
% of total loans |
|
Amount |
|
% of total loans |
Commercial portfolio: |
|
|
|
|
|
|
|
|
|
|
|
Commercial and industrial |
$ |
925,641 |
|
|
22.5 |
% |
|
$ |
805,087 |
|
|
20.8 |
% |
|
$ |
729,385 |
|
|
22.1 |
% |
Multifamily |
|
967,521 |
|
|
23.6 |
% |
|
|
884,790 |
|
|
22.9 |
% |
|
|
821,801 |
|
|
24.8 |
% |
Commercial real estate |
|
335,133 |
|
|
8.2 |
% |
|
|
338,002 |
|
|
8.7 |
% |
|
|
369,429 |
|
|
11.2 |
% |
Construction and land
development |
|
37,696 |
|
|
0.9 |
% |
|
|
38,946 |
|
|
1.0 |
% |
|
|
31,539 |
|
|
1.0 |
% |
Total commercial portfolio |
|
2,265,991 |
|
|
55.2 |
% |
|
|
2,066,825 |
|
|
53.4 |
% |
|
|
1,952,154 |
|
|
59.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Retail portfolio: |
|
|
|
|
|
|
|
|
|
|
|
Residential real estate
lending |
|
1,371,779 |
|
|
33.5 |
% |
|
|
1,332,010 |
|
|
34.5 |
% |
|
|
1,063,682 |
|
|
32.3 |
% |
Consumer and other |
|
463,999 |
|
|
11.3 |
% |
|
|
467,793 |
|
|
12.1 |
% |
|
|
291,818 |
|
|
8.8 |
% |
Total retail |
|
1,835,778 |
|
|
44.8 |
% |
|
|
1,799,803 |
|
|
46.6 |
% |
|
|
1,355,500 |
|
|
41.1 |
% |
Total loans held for investment |
|
4,101,769 |
|
|
100.0 |
% |
|
|
3,866,628 |
|
|
100.0 |
% |
|
|
3,307,654 |
|
|
100.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Net deferred loan origination
costs |
|
4,233 |
|
|
|
|
|
4,662 |
|
|
|
|
|
4,570 |
|
|
|
Allowance for loan losses |
|
(45,031 |
) |
|
|
|
|
(42,122 |
) |
|
|
|
|
(35,866 |
) |
|
|
Total loans, net |
$ |
4,060,971 |
|
|
|
|
$ |
3,829,168 |
|
|
|
|
$ |
3,276,358 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Held-to-maturity securities
portfolio: |
|
|
|
|
|
|
|
|
|
|
|
PACE assessments |
|
911,877 |
|
|
59.2 |
% |
|
|
856,701 |
|
|
57.4 |
% |
|
|
627,394 |
|
|
74.4 |
% |
Other securities |
|
629,424 |
|
|
40.8 |
% |
|
|
635,722 |
|
|
42.6 |
% |
|
|
216,175 |
|
|
25.6 |
% |
Total held-to-maturity securities |
$ |
1,541,301 |
|
|
100.0 |
% |
|
$ |
1,492,423 |
|
|
100.0 |
% |
|
$ |
843,569 |
|
|
100.0 |
% |
Net Interest Income Analysis
|
Three Months Ended |
|
December 31, 2022 |
|
September 30, 2022 |
|
December 31, 2021 |
(In thousands) |
AverageBalance |
Income / Expense |
Yield /Rate |
|
AverageBalance |
Income / Expense |
Yield /Rate |
|
AverageBalance |
Income / Expense |
Yield /Rate |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing deposits in banks |
$ |
85,886 |
|
$ |
485 |
|
2.24 |
% |
|
$ |
222,071 |
|
$ |
971 |
|
1.73 |
% |
|
$ |
561,027 |
|
$ |
200 |
|
0.14 |
% |
Securities(1) |
|
3,400,994 |
|
|
34,939 |
|
4.08 |
% |
|
|
3,522,863 |
|
|
29,735 |
|
3.35 |
% |
|
|
2,876,150 |
|
|
15,973 |
|
2.20 |
% |
Resell agreements |
|
46,909 |
|
|
628 |
|
5.31 |
% |
|
|
232,956 |
|
|
1,845 |
|
3.14 |
% |
|
|
138,436 |
|
|
576 |
|
1.65 |
% |
Total loans, net(2)(3) |
|
3,977,554 |
|
|
42,492 |
|
4.24 |
% |
|
|
3,693,688 |
|
|
38,264 |
|
4.11 |
% |
|
|
3,177,018 |
|
|
32,138 |
|
4.01 |
% |
Total interest-earning assets |
|
7,511,343 |
|
|
78,544 |
|
4.15 |
% |
|
|
7,671,578 |
|
|
70,815 |
|
3.66 |
% |
|
|
6,753,342 |
|
|
48,887 |
|
2.87 |
% |
Non-interest-earning
assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and due from banks |
|
5,267 |
|
|
|
|
|
|
4,783 |
|
|
|
|
|
|
8,072 |
|
|
|
|
Other assets |
|
289,979 |
|
|
|
|
|
|
265,736 |
|
|
|
|
|
|
249,476 |
|
|
|
|
Total assets |
$ |
7,806,589 |
|
|
|
|
|
$ |
7,942,097 |
|
|
|
|
|
$ |
7,010,890 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings, NOW and money market
deposits |
$ |
2,967,150 |
|
$ |
5,161 |
|
0.69 |
% |
|
$ |
3,031,402 |
|
$ |
2,329 |
|
0.30 |
% |
|
$ |
2,765,380 |
|
$ |
1,220 |
|
0.18 |
% |
Time deposits and brokered
certificates of deposit |
|
204,185 |
|
|
521 |
|
1.01 |
% |
|
|
184,476 |
|
|
162 |
|
0.35 |
% |
|
|
215,562 |
|
|
187 |
|
0.34 |
% |
Total interest-bearing deposits |
|
3,171,335 |
|
|
5,682 |
|
0.71 |
% |
|
|
3,215,878 |
|
|
2,491 |
|
0.31 |
% |
|
|
2,980,942 |
|
|
1,407 |
|
0.19 |
% |
Federal Home Loan Bank
advances |
|
451,032 |
|
|
4,713 |
|
4.15 |
% |
|
|
3,314 |
|
|
25 |
|
2.99 |
% |
|
|
— |
|
|
— |
|
0.00 |
% |
Other Borrowings |
|
94,271 |
|
|
801 |
|
3.37 |
% |
|
|
82,009 |
|
|
671 |
|
3.25 |
% |
|
|
49,891 |
|
|
399 |
|
3.17 |
% |
Total interest-bearing liabilities |
|
3,716,638 |
|
|
11,196 |
|
1.20 |
% |
|
|
3,301,201 |
|
|
3,187 |
|
0.38 |
% |
|
|
3,030,833 |
|
|
1,806 |
|
0.24 |
% |
Non-interest-bearing liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand and transaction
deposits |
|
3,522,352 |
|
|
|
|
|
|
4,053,953 |
|
|
|
|
|
|
3,290,932 |
|
|
|
|
Other liabilities |
|
73,838 |
|
|
|
|
|
|
75,143 |
|
|
|
|
|
|
126,746 |
|
|
|
|
Total liabilities |
|
7,312,828 |
|
|
|
|
|
|
7,430,297 |
|
|
|
|
|
|
6,448,511 |
|
|
|
|
Stockholders' equity |
|
493,761 |
|
|
|
|
|
|
511,800 |
|
|
|
|
|
|
562,379 |
|
|
|
|
Total liabilities and stockholders' equity |
$ |
7,806,589 |
|
|
|
|
|
$ |
7,942,097 |
|
|
|
|
|
$ |
7,010,890 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income / interest rate spread |
|
|
$ |
67,348 |
|
2.95 |
% |
|
|
|
$ |
67,628 |
|
3.28 |
% |
|
|
|
$ |
47,081 |
|
2.63 |
% |
Net interest earning assets / net interest margin |
$ |
3,794,705 |
|
|
|
3.56 |
% |
|
$ |
4,370,377 |
|
|
|
3.50 |
% |
|
$ |
3,722,509 |
|
|
|
2.77 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total deposits / total cost of deposits |
$ |
6,693,687 |
|
|
|
0.34 |
% |
|
$ |
7,269,831 |
|
|
|
0.14 |
% |
|
$ |
6,271,874 |
|
|
|
0.09 |
% |
Total borrowings / total cost of funds |
$ |
7,238,990 |
|
|
|
0.61 |
% |
|
$ |
7,355,154 |
|
|
|
0.17 |
% |
|
$ |
6,321,765 |
|
|
|
0.11 |
% |
(1) Includes Federal Home Loan Bank (FHLB) stock in the average
balance, and dividend income on FHLB stock in interest income(2)
Amounts are net of deferred origination costs and the allowance for
loan losses(3) Includes prepayment penalty interest income in
4Q2022, 3Q2022, and 4Q2021 of $82, $800, and $353, respectively (in
thousands)
Net Interest Income Analysis
|
Year Ended |
|
December 31, 2022 |
|
December 31, 2021 |
(In thousands) |
AverageBalance |
Income / Expense |
Yield /Rate |
|
AverageBalance |
Income / Expense |
Yield /Rate |
|
|
|
|
|
|
|
|
|
|
|
|
Interest-earning assets: |
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing deposits in banks |
$ |
258,214 |
|
$ |
2,186 |
|
0.85 |
% |
|
$ |
521,681 |
|
$ |
651 |
|
0.12 |
% |
Securities(1) |
|
3,391,056 |
|
|
106,417 |
|
3.14 |
% |
|
|
2,461,661 |
|
|
54,615 |
|
2.22 |
% |
Resell agreements |
|
182,304 |
|
|
4,237 |
|
2.32 |
% |
|
|
138,833 |
|
|
1,942 |
|
1.40 |
% |
Total loans, net(2)(3) |
|
3,615,437 |
|
|
145,649 |
|
4.03 |
% |
|
|
3,180,093 |
|
|
123,318 |
|
3.88 |
% |
Total interest-earning assets |
|
7,447,011 |
|
|
258,489 |
|
3.47 |
% |
|
|
6,302,268 |
|
|
180,526 |
|
2.86 |
% |
Non-interest-earning assets: |
|
|
|
|
|
|
|
|
|
|
|
Cash and due from banks |
|
7,126 |
|
|
|
|
|
|
7,853 |
|
|
|
|
Other assets |
|
273,028 |
|
|
|
|
|
|
259,718 |
|
|
|
|
Total assets |
$ |
7,727,165 |
|
|
|
|
|
$ |
6,569,839 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing liabilities: |
|
|
|
|
|
|
|
|
|
|
|
Savings, NOW and money market
deposits |
$ |
2,981,688 |
|
$ |
10,068 |
|
0.34 |
% |
|
$ |
2,622,584 |
|
$ |
4,788 |
|
0.18 |
% |
Time deposits and brokered
certificates of deposit |
|
195,030 |
|
|
987 |
|
0.51 |
% |
|
|
248,507 |
|
|
1,035 |
|
0.42 |
% |
Total interest-bearing deposits |
|
3,176,718 |
|
|
11,055 |
|
0.35 |
% |
|
|
2,871,091 |
|
|
5,823 |
|
0.20 |
% |
Federal Home Loan Bank
advances |
|
114,521 |
|
|
4,738 |
|
4.14 |
% |
|
|
123 |
|
|
— |
|
0.00 |
% |
Other Borrowings |
|
86,205 |
|
|
2,854 |
|
3.31 |
% |
|
|
12,575 |
|
|
399 |
|
3.17 |
% |
Total interest-bearing liabilities |
|
3,377,444 |
|
|
18,647 |
|
0.55 |
% |
|
|
2,883,789 |
|
|
6,222 |
|
0.22 |
% |
Non-interest-bearing liabilities: |
|
|
|
|
|
|
|
|
|
|
|
Demand and transaction
deposits |
|
3,746,152 |
|
|
|
|
|
|
3,017,621 |
|
|
|
|
Other liabilities |
|
82,931 |
|
|
|
|
|
|
116,256 |
|
|
|
|
Total liabilities |
|
7,206,527 |
|
|
|
|
|
|
6,017,666 |
|
|
|
|
Stockholders' equity |
|
520,638 |
|
|
|
|
|
|
552,173 |
|
|
|
|
Total liabilities and stockholders' equity |
$ |
7,727,165 |
|
|
|
|
|
$ |
6,569,839 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income / interest rate spread |
|
|
$ |
239,842 |
|
2.92 |
% |
|
|
|
$ |
174,304 |
|
2.64 |
% |
Net interest earning assets / net interest margin |
$ |
4,069,567 |
|
|
|
3.22 |
% |
|
$ |
3,418,479 |
|
|
|
2.77 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Total deposits / total cost of deposits |
$ |
6,922,870 |
|
|
|
0.16 |
% |
|
$ |
5,888,712 |
|
|
|
0.10 |
% |
Total borrowings / total cost of funds |
$ |
7,123,596 |
|
|
|
0.26 |
% |
|
$ |
5,901,410 |
|
|
|
0.11 |
% |
(1) Includes Federal Home Loan Bank (FHLB) stock in the average
balance, and dividend income on FHLB stock in interest income(2)
Amounts are net of deferred origination costs (fees) and the
allowance for loan losses(3) Includes prepayment penalty interest
income in December YTD 2022 and December YTD 2021 of $1.7 million
and $1.7 million, respectively
Deposit Portfolio Composition
|
Three Months Ended |
(In thousands) |
December 31, 2022 |
|
September 30, 2022 |
|
December 31, 2021 |
|
Ending Balance |
|
Average Balance |
|
Ending Balance |
|
Average Balance |
|
Ending Balance |
|
Average Balance |
Non-interest-bearing demand deposit accounts |
$ |
3,331,067 |
|
$ |
3,522,352 |
|
$ |
3,839,155 |
|
$ |
4,053,953 |
|
$ |
3,335,005 |
|
$ |
3,290,932 |
NOW accounts |
|
206,434 |
|
|
200,633 |
|
|
204,473 |
|
|
210,972 |
|
|
210,844 |
|
|
204,556 |
Money market deposit
accounts |
|
2,445,396 |
|
|
2,385,446 |
|
|
2,549,024 |
|
|
2,437,920 |
|
|
2,227,953 |
|
|
2,190,423 |
Savings accounts |
|
386,190 |
|
|
381,071 |
|
|
384,644 |
|
|
382,510 |
|
|
375,301 |
|
|
370,401 |
Time deposits |
|
151,699 |
|
|
167,138 |
|
|
183,011 |
|
|
184,476 |
|
|
207,152 |
|
|
215,562 |
Brokered CD |
|
74,251 |
|
|
37,047 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
Total deposits |
$ |
6,595,037 |
|
$ |
6,693,687 |
|
$ |
7,160,307 |
|
$ |
7,269,831 |
|
$ |
6,356,255 |
|
$ |
6,271,874 |
|
Three Months Ended |
|
December 31, 2022 |
|
September 30, 2022 |
|
December 31, 2021 |
|
Average Rate Paid(1) |
|
Cost of Funds |
|
Average Rate Paid(1) |
|
Cost of Funds |
|
Average Rate Paid(1) |
|
Cost of Funds |
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest-bearing demand deposit accounts |
0.00 |
% |
|
0.00 |
% |
|
0.00 |
% |
|
0.00 |
% |
|
0.00 |
% |
|
0.00 |
% |
NOW accounts |
0.74 |
% |
|
0.52 |
% |
|
0.34 |
% |
|
0.19 |
% |
|
0.08 |
% |
|
0.09 |
% |
Money market deposit
accounts |
1.16 |
% |
|
0.74 |
% |
|
0.43 |
% |
|
0.33 |
% |
|
0.16 |
% |
|
0.20 |
% |
Savings accounts |
0.75 |
% |
|
0.49 |
% |
|
0.32 |
% |
|
0.19 |
% |
|
0.11 |
% |
|
0.11 |
% |
Time deposits |
0.69 |
% |
|
0.41 |
% |
|
0.44 |
% |
|
0.35 |
% |
|
0.29 |
% |
|
0.34 |
% |
Brokered CD |
3.83 |
% |
|
3.72 |
% |
|
0.00 |
% |
|
0.00 |
% |
|
0.00 |
% |
|
0.00 |
% |
Total deposits |
0.57 |
% |
|
0.34 |
% |
|
0.19 |
% |
|
0.14 |
% |
|
0.08 |
% |
|
0.09 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing deposits
excluding brokered CDs |
1.15 |
% |
|
0.68 |
% |
|
0.41 |
% |
|
0.31 |
% |
|
0.16 |
% |
|
0.19 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
(1)Average rate paid
is calculated as the weighted average of spot rates on deposit
accounts as of December 31, 2022. |
Asset Quality
(In thousands) |
December 31, 2022 |
|
September 30, 2022 |
|
December 31, 2021 |
Loans 90 days past due and accruing |
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
Nonaccrual loans held for
sale |
|
6,914 |
|
|
|
5,858 |
|
|
|
1,000 |
|
Troubled debt restructured
loans - accruing loans held for sale |
|
— |
|
|
|
10,179 |
|
|
|
— |
|
Nonaccrual loans excluding
held for sale loans and restructured loans |
|
8,197 |
|
|
|
7,499 |
|
|
|
10,835 |
|
Troubled debt restructured
loans - nonaccrual |
|
13,502 |
|
|
|
12,322 |
|
|
|
13,497 |
|
Troubled debt restructured
loans - accruing |
|
6,102 |
|
|
|
18,396 |
|
|
|
24,997 |
|
Other real estate owned |
|
— |
|
|
|
— |
|
|
|
307 |
|
Impaired securities |
|
36 |
|
|
|
37 |
|
|
|
63 |
|
Total nonperforming
assets |
$ |
34,751 |
|
|
$ |
54,291 |
|
|
$ |
54,586 |
|
|
|
|
|
|
|
Nonaccrual
loans: |
|
|
|
|
|
Commercial and industrial |
$ |
9,629 |
|
|
$ |
9,356 |
|
|
$ |
8,313 |
|
Multifamily |
|
3,828 |
|
|
|
3,494 |
|
|
|
2,907 |
|
Commercial real estate |
|
4,851 |
|
|
|
4,914 |
|
|
|
4,054 |
|
Construction and land development |
|
— |
|
|
|
— |
|
|
|
— |
|
Total commercial portfolio |
|
18,308 |
|
|
|
17,764 |
|
|
|
15,274 |
|
|
|
|
|
|
|
Residential real estate lending |
|
1,807 |
|
|
|
675 |
|
|
|
12,525 |
|
Consumer and other |
|
1,584 |
|
|
|
1,382 |
|
|
|
420 |
|
Total retail portfolio |
|
3,391 |
|
|
|
2,057 |
|
|
|
12,945 |
|
Total nonaccrual loans |
$ |
21,699 |
|
|
$ |
19,821 |
|
|
$ |
28,219 |
|
|
|
|
|
|
|
Nonaccrual loans to total
loans |
|
0.53 |
% |
|
|
0.51 |
% |
|
|
0.85 |
% |
Nonperforming assets to total
assets |
|
0.44 |
% |
|
|
0.69 |
% |
|
|
0.77 |
% |
Allowance for loan losses to
nonaccrual loans |
|
207.53 |
% |
|
|
212.51 |
% |
|
|
127.10 |
% |
Allowance for loan losses to
total loans |
|
1.10 |
% |
|
|
1.09 |
% |
|
|
1.08 |
% |
Annualized net charge-offs
(recoveries) to average loans |
|
0.15 |
% |
|
|
0.29 |
% |
|
|
0.44 |
% |
Credit Quality
|
December 31, 2022 |
|
September 30, 2022 |
|
December 31, 2021 |
($ in thousands) |
|
|
|
|
|
Criticized and
classified loans |
|
|
|
|
|
Commercial and industrial |
$ |
32,004 |
|
$ |
26,756 |
|
$ |
36,073 |
Multifamily |
|
19,860 |
|
|
42,105 |
|
|
99,932 |
Commercial real estate |
|
35,180 |
|
|
39,628 |
|
|
74,168 |
Construction and land
development |
|
16,426 |
|
|
2,424 |
|
|
7,476 |
Residential real estate
lending |
|
1,807 |
|
|
675 |
|
|
12,817 |
Consumer and other |
|
323 |
|
|
1,382 |
|
|
420 |
Total loans |
$ |
105,600 |
|
$ |
112,970 |
|
$ |
230,886 |
|
|
|
|
|
|
Criticized and
classified loans to total loans |
|
|
|
|
|
Commercial and industrial |
0.78 |
% |
|
0.69 |
% |
|
1.09 |
% |
Multifamily |
0.48 |
% |
|
1.09 |
% |
|
3.02 |
% |
Commercial real estate |
0.86 |
% |
|
1.02 |
% |
|
2.24 |
% |
Construction and land
development |
0.40 |
% |
|
0.06 |
% |
|
0.23 |
% |
Residential real estate
lending |
0.04 |
% |
|
0.02 |
% |
|
0.39 |
% |
Consumer and other |
0.01 |
% |
|
0.04 |
% |
|
0.01 |
% |
|
2.57 |
% |
|
2.92 |
% |
|
6.98 |
% |
Reconciliation of GAAP to Non-GAAP Financial
MeasuresThe information provided below presents a
reconciliation of each of our non-GAAP financial measures to the
most directly comparable GAAP financial measure.
|
As of and for the |
|
As of and for the |
|
Three Months Ended |
|
Year Ended |
(in thousands) |
December 31, 2022 |
|
September 30, 2022 |
|
December 31, 2021 |
|
December 31, 2022 |
|
December 31, 2021 |
Core operating
revenue |
|
|
|
|
|
|
|
|
|
Net Interest income (GAAP) |
$ |
67,346 |
|
|
$ |
67,628 |
|
|
$ |
47,081 |
|
|
$ |
239,840 |
|
|
$ |
174,304 |
|
Non-interest income |
|
4,226 |
|
|
|
5,003 |
|
|
|
12,361 |
|
|
|
23,897 |
|
|
|
28,389 |
|
Less: Securities (gain)
loss |
|
1,373 |
|
|
|
1,844 |
|
|
|
106 |
|
|
|
3,637 |
|
|
|
(649 |
) |
Less: Subdebt repurchase
gain |
|
— |
|
|
|
(617 |
) |
|
|
— |
|
|
|
(617 |
) |
|
|
— |
|
Core operating revenue
(non-GAAP) |
$ |
72,945 |
|
|
$ |
73,858 |
|
|
$ |
59,548 |
|
|
$ |
266,757 |
|
|
$ |
202,044 |
|
Add: Tax (credits)
depreciation on solar investments |
|
1,706 |
|
|
|
1,306 |
|
|
|
(5,337 |
) |
|
|
3,811 |
|
|
|
1,055 |
|
Core operating revenue
excluding solar tax impact (non-GAAP) |
$ |
74,651 |
|
|
$ |
75,164 |
|
|
$ |
54,211 |
|
|
$ |
270,568 |
|
|
$ |
203,099 |
|
|
|
|
|
|
|
|
|
|
|
Core non-interest
expense |
|
|
|
|
|
|
|
|
|
Non-interest expense
(GAAP) |
$ |
35,570 |
|
|
$ |
36,258 |
|
|
$ |
35,032 |
|
|
$ |
140,571 |
|
|
$ |
132,255 |
|
Less: Other one-time
expenses(1) |
|
— |
|
|
|
— |
|
|
|
(984 |
) |
|
|
(738 |
) |
|
|
(2,466 |
) |
Core non-interest expense
(non-GAAP) |
$ |
35,570 |
|
|
$ |
36,258 |
|
|
$ |
34,048 |
|
|
$ |
139,833 |
|
|
$ |
129,789 |
|
|
|
|
|
|
|
|
|
|
|
Core net
income |
|
|
|
|
|
|
|
|
|
Net Income (GAAP) |
$ |
24,755 |
|
|
$ |
22,944 |
|
|
$ |
15,924 |
|
|
$ |
81,477 |
|
|
$ |
52,937 |
|
Less: Securities (gain)
loss |
|
1,373 |
|
|
|
1,844 |
|
|
|
106 |
|
|
|
3,637 |
|
|
|
(649 |
) |
Less: Subdebt repurchase
gain |
|
— |
|
|
|
(617 |
) |
|
|
— |
|
|
|
(617 |
) |
|
|
— |
|
Add: Other one-time
expenses |
|
— |
|
|
|
— |
|
|
|
984 |
|
|
|
738 |
|
|
|
2,466 |
|
Less: Tax on notable
items |
|
(296 |
) |
|
|
(319 |
) |
|
|
(257 |
) |
|
|
(927 |
) |
|
|
(457 |
) |
Core net income
(non-GAAP) |
$ |
25,832 |
|
|
$ |
23,852 |
|
|
$ |
16,757 |
|
|
$ |
84,308 |
|
|
$ |
54,297 |
|
Add: Tax (credits)
depreciation on solar investments |
|
1,706 |
|
|
|
1,306 |
|
|
|
(5,337 |
) |
|
|
3,811 |
|
|
|
1,055 |
|
Add: Tax effect of solar
income |
|
(368 |
) |
|
|
(340 |
) |
|
|
1,259 |
|
|
|
(940 |
) |
|
|
(265 |
) |
Core net income excluding
solar tax impact (non-GAAP) |
$ |
27,170 |
|
|
$ |
24,818 |
|
|
$ |
12,679 |
|
|
$ |
87,179 |
|
|
$ |
55,087 |
|
|
|
|
|
|
|
|
|
|
|
Tangible common
equity |
|
|
|
|
|
|
|
|
|
Stockholders' equity
(GAAP) |
$ |
508,955 |
|
|
$ |
487,738 |
|
|
$ |
563,875 |
|
|
$ |
508,955 |
|
|
$ |
563,875 |
|
Less: Minority interest |
|
(133 |
) |
|
|
(133 |
) |
|
|
(133 |
) |
|
|
(133 |
) |
|
|
(133 |
) |
Less: Goodwill |
|
(12,936 |
) |
|
|
(12,936 |
) |
|
|
(12,936 |
) |
|
|
(12,936 |
) |
|
|
(12,936 |
) |
Less: Core deposit
intangible |
|
(3,105 |
) |
|
|
(3,366 |
) |
|
|
(4,151 |
) |
|
|
(3,105 |
) |
|
|
(4,151 |
) |
Tangible common equity
(non-GAAP) |
$ |
492,781 |
|
|
$ |
471,303 |
|
|
$ |
546,655 |
|
|
$ |
492,781 |
|
|
$ |
546,655 |
|
|
|
|
|
|
|
|
|
|
|
Average tangible
common equity |
|
|
|
|
|
|
|
|
|
Average stockholders' equity
(GAAP) |
$ |
493,761 |
|
|
$ |
511,800 |
|
|
$ |
562,379 |
|
|
$ |
520,638 |
|
|
$ |
552,173 |
|
Less: Minority interest |
|
(133 |
) |
|
|
(133 |
) |
|
|
(133 |
) |
|
|
(133 |
) |
|
|
(133 |
) |
Less: Goodwill |
|
(12,936 |
) |
|
|
(12,936 |
) |
|
|
(12,936 |
) |
|
|
(12,936 |
) |
|
|
(12,936 |
) |
Less: Core deposit
intangible |
|
(3,232 |
) |
|
|
(3,494 |
) |
|
|
(4,299 |
) |
|
|
(3,622 |
) |
|
|
(4,748 |
) |
Average tangible common equity
(non-GAAP) |
$ |
477,460 |
|
|
$ |
495,237 |
|
|
$ |
545,011 |
|
|
$ |
503,947 |
|
|
$ |
534,356 |
|
|
|
|
|
|
|
|
|
|
|
Core return on average
assets |
|
|
|
|
|
|
|
|
|
Denominator: Total average
assets |
$ |
7,806,589 |
|
|
$ |
7,942,097 |
|
|
$ |
7,010,890 |
|
|
$ |
7,727,165 |
|
|
$ |
6,569,839 |
|
Core return on average assets
(non-GAAP)2 |
|
1.31 |
% |
|
|
1.19 |
% |
|
|
0.95 |
% |
|
|
1.09 |
% |
|
|
0.83 |
% |
Core return on average assets
excluding solar tax impact (non-GAAP)2 |
|
1.38 |
% |
|
|
1.24 |
% |
|
|
0.72 |
% |
|
|
1.13 |
% |
|
|
0.84 |
% |
|
|
|
|
|
|
|
|
|
|
Core return on average
tangible common equity |
|
|
|
|
|
|
|
|
|
Denominator: Average tangible
common equity |
$ |
477,460 |
|
|
$ |
495,237 |
|
|
$ |
545,011 |
|
|
$ |
503,947 |
|
|
$ |
534,356 |
|
Core return on average
tangible common equity (non-GAAP)2 |
|
21.47 |
% |
|
|
19.11 |
% |
|
|
12.20 |
% |
|
|
16.73 |
% |
|
|
10.16 |
% |
Core return on average
tangible common equity excluding solar tax impact (non-GAAP)2 |
|
22.58 |
% |
|
|
19.88 |
% |
|
|
9.23 |
% |
|
|
17.30 |
% |
|
|
10.31 |
% |
|
|
|
|
|
|
|
|
|
|
Core efficiency
ratio |
|
|
|
|
|
|
|
|
|
Core operating revenue
(non-GAAP) |
$ |
72,945 |
|
|
$ |
73,858 |
|
|
$ |
59,548 |
|
|
$ |
266,757 |
|
|
$ |
202,044 |
|
Core efficiency ratio
(non-GAAP) |
|
48.76 |
% |
|
|
49.09 |
% |
|
|
57.18 |
% |
|
|
52.42 |
% |
|
|
64.24 |
% |
Core efficiency ratio
excluding solar tax impact (non-GAAP) |
|
47.65 |
% |
|
|
48.24 |
% |
|
|
62.81 |
% |
|
|
51.68 |
% |
|
|
63.90 |
% |
(1) Salary and COBRA reimbursement expense for positions
eliminated, plus expenses related to the termination of the merger
agreement with Amalgamated Bank of Chicago(2) Calculated using core
net income (non-GAAP) and core net income excluding solar tax
investments (non-GAAP), respectively, as the numerator.
1 Reconciliations of non-GAAP financial measures to the most
comparable GAAP measure are set forth on the last page of the
financial information accompanying this press release and may also
be found on our website, www.amalgamatedbank.com.
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