TRUE000161724200016172422024-01-252024-01-25
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_____________________________
FORM 8-K/A
_____________________________
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): January 25, 2024
_____________________________
KEARNY FINANCIAL CORP.
(Exact name of Registrant as Specified in Its Charter)
_____________________________
| | | | | | | | |
| Maryland | 001-37399 | 30-0870244 |
(State or Other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
| | |
120 Passaic Avenue Fairfield, New Jersey | | 07004 |
(Address of Principal Executive Offices) | | (Zip Code) |
Registrant’s Telephone Number, Including Area Code: (973) 244-4500
(Former Name or Former Address, if Changed Since Last Report)
_____________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2. below):
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
| | | | | | | | | | | | | | |
| Title of each class | | Trading Symbol(s) | | Name of each exchange on which registered |
| Common Stock, $0.01 par value | | KRNY | | The NASDAQ Stock Market LLC |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
EXPLANATORY NOTE
On January 25, 2024, Kearny Financial Corp. (the “Company”), the holding company for Kearny Bank, issued a press release reporting its financial results for the quarter ended December 31, 2023 (the “Original Earnings Release”). A copy of the Original Earnings Release was furnished by the Company with a Current Report on Form 8-K on January 25, 2024 (the “Original 8-K”). On January 31, 2024, the Company issued a press release (the “Revised Earnings Release”), revising the Original Earnings Release, to adjust the timing of income recognition associated with a $4.8 million non-recurring increase in cash surrender value (the “enhancement fee”) associated with restructuring of its Bank-Owned Life Insurance ("BOLI") portfolio that was originally recognized as non-interest income during the quarter.
During the quarter ended December 31, 2023, the Company recorded a $4.8 million non-recurring increase in BOLI cash surrender value and recognized the enhancement fee within non-interest income. Subsequent to the issuance of the Original Earnings Release, the Company continued to evaluate the matter and determined it was necessary to revise its accounting for the enhancement fee and derecognize the enhancement fee and the increase in BOLI cash surrender value initially recorded in the financial statements as of and for the quarter ended December 31, 2023. As a result, the $4.8 million enhancement fee will be recognized prospectively as non-interest income in future periods.
The sole purpose of this Amendment No. 1 on Form 8-K/A is to amend Items 2.02, 7.01 and 9.01 of the Original 8-K and furnish the Revised Earnings Release in place of the Original Earnings Release. No changes have been made to Item 8.01 of the Original 8-K. Except as set forth herein, no other information in the Original 8-K is being amended.
Item 2.02 Results of Operation and Financial Condition
The Revised Earnings Release, which was issued by the Company on January 31, 2024, is attached hereto as Exhibit 99.1 and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933.
Item 7.01 Regulation FD Disclosure
For the reasons addressed above, the Company released a revised slide presentation on January 31, 2024, that will be used in upcoming meetings with potential investors and current shareholders of the Company and is attached hereto as Exhibit 99.2 to this Current Report on Form 8-K and is incorporated herein by reference. The information included in this Current Report pursuant to this Item 7.01 is being furnished to, and not filed with, the Securities and Exchange Commission.
Item 9.01 Financial Statements and Exhibits
(a)Financial Statements of Business Acquired. Not applicable.
(b)Pro Forma Financial Information. Not applicable.
(c)Shell Company Transaction. Not applicable.
(d)Exhibits.
| | | | | | | | |
| Exhibit Number | | Description |
| 99.1 | | |
| 99.2 | | |
| 104 | | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| | | | | | | | |
| KEARNY FINANCIAL CORP. |
| | |
Date: January 31, 2024 | By: | /s/ Keith Suchodolski |
| | Keith Suchodolski |
| | Senior Executive Vice President and Chief Financial Officer |
Exhibit 99.1
FOR IMMEDIATE RELEASE
January 31, 2024
For further information contact:
Craig L. Montanaro, President and Chief Executive Officer, or
Keith Suchodolski, Senior Executive Vice President and Chief Financial Officer
Kearny Financial Corp.
(973) 244-4500
KEARNY FINANCIAL CORP. REVISES SECOND QUARTER FISCAL 2024 RESULTS
Fairfield, N.J., January 31, 2024 – Kearny Financial Corp. (NASDAQ GS: KRNY) (the “Company”), the holding company of Kearny Bank (the “Bank”), revised the Company’s earnings release for the quarter ended December 31, 2023 (the “Revised Earnings Release”), which was issued on January 25, 2024 (the “Original Earnings Release”), to adjust the timing of income recognition associated with a $4.8 million non-recurring increase in cash surrender value (the “enhancement fee”) associated with restructuring of its Bank-Owned Life Insurance (“BOLI”) portfolio that was originally recognized as non-interest income during the quarter.
During the quarter ended December 31, 2023, the Company recorded a $4.8 million non-recurring increase in BOLI cash surrender value and recognized the enhancement fee within non-interest income. Subsequent to the issuance of the Original Earnings Release, the Company continued to evaluate the matter and determined it was necessary to revise its accounting for the enhancement fee and derecognize the enhancement fee and the increase in BOLI cash surrender value initially recorded in the financial statements as of and for the quarter ended December 31, 2023. As a result, the $4.8 million enhancement fee will be recognized prospectively as non-interest income in future periods.
The impact to the Company’s income statement, as a result of this revision, was to increase the Company’s net loss for the quarter ended December 31, 2023 by $4.8 million, resulting in a net loss of $13.8 million, or $0.22 per diluted share.
Other than the $4.8 million revision discussed above, all of the financial results of the BOLI portfolio restructuring transaction remain the same as reported on January 25, 2024.
The Company also announced that its Board of Directors has declared a quarterly cash dividend of $0.11 per share, payable on February 21, 2024, to stockholders of record as of February 7, 2024.
Craig L. Montanaro, President and Chief Executive Officer, commented, “This quarter we executed strategies, as described in further detail below, to enhance our balance sheet, liquidity position, risk profile and asset quality metrics. In addition, we have begun to see deposit pressures ease, while run-rate non-interest expense remains very well controlled. As we look ahead, we remain laser-focused on sustainable growth in core loan and deposit relationships, while continuing to further leverage our recently implemented, best-in-class, digital banking platform.”
Strategic Actions Taken During the Quarter Ended December 31, 2023
Investment Securities Repositioning
As previously announced, the Company executed the sale of $122.2 million of its available-for-sale (“AFS”) debt securities. The sale resulted in a pre-tax net loss of $18.1 million and had a nominal impact on tangible book value, as the loss was previously reflected in capital via accumulated other comprehensive loss. Proceeds from the sale were utilized to retire higher-cost wholesale funding and to reinvest in loans yielding approximately 7.0%.
Bank-Owned Life Insurance (“BOLI”) Restructuring
The Company initiated a restructuring of its BOLI portfolio in which $103.4 million of policies yielding 2.1% were exchanged or surrendered and replaced with policies yielding 5.1%. As a result of this restructure, the Company recognized tax expense of $5.7 million and exchange charges of $573 thousand.
Resolution of Non-performing Assets (“NPAs”)
At December 31, 2023, the Company was under contract to sell a $12.0 million Other Real Estate Owned (“OREO”) asset that was subsequently sold in January 2024. Proceeds from the sale were immediately redeployed into interest earning assets and will
improve forward-looking earnings thru the reduction of net OREO expenses, which totaled approximately $469 thousand for the quarter ended December 31, 2023.
In addition, the Company reclassified three non-performing commercial real estate loans to loans held-for-sale as a result of its intent to sell these assets in the near term. These loans are attributable to one borrower relationship and had a fair value of $9.7 million at December 31, 2023.
Hedging Activities
As part of the ongoing strategy to manage interest rate risk and support earnings, the Company added $500.0 million of derivative notional, comprised of $200.0 million of cash flow swaps and $300.0 million of interest rate floor spreads, all of which mature in two years or less. Collectively, these derivatives hedge a portion of the Company’s wholesale funding position and mitigate the interest rate risk associated with a modest decrease in short-term interest rates.
Balance Sheet
•Total assets were $7.90 billion at December 31, 2023, a decrease of $77.0 million, or 1.0%, from September 30, 2023.
•Investment securities totaled $1.29 billion at December 31, 2023, a decrease of $73.2 million, or 5.4%, from September 30, 2023. The decrease for the quarter was largely driven by the sale of available-for-sale debt securities, as discussed above.
•Loans receivable totaled $5.75 billion at December 31, 2023, an increase of $9.6 million, or 0.2%, from September 30, 2023.
•BOLI totaled $256.1 million at December 31, 2023, a decrease of $38.4 million, or 13.0%, from September 30, 2023. The decrease for the quarter was largely attributable to the surrender of $43.2 million of BOLI policies, as discussed above, that did not settle until January 2024.
•Deposits were $5.32 billion at December 31, 2023, a decrease of $114.5 million, or 2.1%, from September 30, 2023. Excluding a decrease of $154.5 million in brokered certificates of deposits, deposits increased $40.0 million, or 0.8%, from September 30, 2023.
•The aggregate amount of uninsured deposits at the Bank was $1.81 billion at December 31, 2023. Excluding collateralized deposits of state and local governments and deposits of the Bank’s wholly-owned subsidiary and holding company, the aggregate amount of uninsured deposits was $694.5 million, or 13.1% of total deposits.
•Borrowings were $1.67 billion at December 31, 2023, an increase of $40.1 million, or 2.5%, from September 30, 2023.
•At December 31, 2023, the Company maintained available secured borrowing capacity of $1.78 billion, of which $1.38 billion was immediately accessible via in-place collateral and $400.8 million represented the market value of unpledged securities.
Earnings
Net Interest Income and Net Interest Margin
•Net interest margin contracted 16 basis point to 1.94% for the quarter ended December 31, 2023. The decrease for the quarter was driven by an increase in the cost of interest-bearing liabilities and a decrease in the average balance of interest-earning assets, partially offset by a higher yield on interest-earning assets.
•For the quarter ended December 31, 2023, net interest income decreased $3.3 million to $35.8 million from $39.2 million for the quarter ended September 30, 2023. Included in net interest income for the quarters ended December 31, 2023 and September 30, 2023, respectively, was purchase accounting accretion of $640,000 and $650,000, and loan prepayment penalty income of $185,000 and $267,000.
Non-Interest Income
•For the quarter ended December 31, 2023, non-interest income decreased $20.0 million from the quarter ended September 30, 2023 to a loss of $16.0 million. The decrease was primarily attributable to a pre-tax loss of $18.1 million related to the investment securities portfolio repositioning, as discussed above.
•Income from BOLI decreased $504,000 to $1.2 million for the quarter ended December 31, 2023 from $1.7 million for the quarter ended September 30, 2023, due to non-recurring exchange charges related to the BOLI restructure, as discussed above.
•Included in other income for the quarter ended December 31, 2023 were non-recurring losses of $974,000 attributable to the write-down of one OREO property, as discussed above. No such losses were recorded during the quarter ended September 30, 2023. OREO income for the quarter ended December 31, 2023 was $182,000.
Non-Interest Expense
•For the quarter ended December 31, 2023, non-interest expense remained flat at $29.8 million compared to the quarter ended September 30, 2023.
•Included in other expenses for the quarter ended December 31, 2023 were OREO expenses totaling $651,000.
Income Taxes
•Income tax expense totaled $1.8 million for the quarter ended December 31, 2023 compared to $3.3 million for the quarter ended September 30, 2023. The decrease in income tax expense was due to lower pre-tax income, primarily attributable to realized losses on the sale of securities, as discussed above, partially offset by $5.7 million of tax expense related to the surrender of BOLI policies, as discussed above.
Asset Quality
•The balance of non-performing assets decreased $1.1 million to $49.8 million, or 0.63% of total assets, at December 31, 2023, from $50.9 million, or 0.64% of total assets, at September 30, 2023. Adjusting for the sale of the OREO asset completed in January 2024, the non-performing assets decrease to $37.8 million, or 0.48% of total assets.
•Net charge-offs totaled $4.1 million, or 0.29% of average loans, on an annualized basis, for the quarter ended December 31, 2023, compared to $2.1 million, or 0.15% of average loans, on an annualized basis, for the quarter ended September 30, 2023. The charge-offs recorded during the quarter ended December 31, 2023 were primarily driven by the reclassification of three non-performing loans to held-for-sale status, reflecting the Company’s intent to sell these assets, as discussed above. Of the $4.1 million of net charge-offs recorded during the quarter ended December 31, 2023, $1.7 million had previously been individually reserved for within the allowance for credit losses.
•For the quarter ended December 31, 2023, the Company recorded a provision for credit losses of $2.1 million, compared to $245,000 for the quarter ended September 30, 2023. The provision for credit loss expense for the quarter ended December 31, 2023 was primarily attributable to charge-offs on the three commercial real estate loans, as discussed above.
•The allowance for credit losses (“ACL”) was $44.9 million, or 0.78% of total loans, at December 31, 2023, compared to $46.9 million, or 0.81% of total loans, at September 30, 2023. The decrease in the ACL was largely attributable to a reduction in reserves for individually evaluated loans, resulting from the charge-offs noted above.
Capital
•During the quarter ended December 31, 2023, the Company repurchased 687,140 shares of common stock at a cost of $4.7 million, or $6.88 per share.
•On November 7, 2023, the Company announced the completion of its ninth stock repurchase plan which authorized the repurchase of 4,000,000 shares. Such shares were repurchased at a cost of $34.9 million, or $8.74 per share.
•For the quarter ended December 31, 2023, book value per share increased $0.12, or 0.9%, to $13.16 while tangible book value per share increased $0.08, or 0.8%, to $9.85. These increases were largely driven by a decrease in accumulated other comprehensive loss.
•At December 31, 2023, total stockholders’ equity included after-tax net unrealized losses on securities available for sale of $88.6 million, partially offset by after-tax unrealized gains on derivatives of $24.6 million. After-tax net unrecognized losses on securities held to maturity of $10.0 million were not reflected in total stockholders’ equity.
•At December 31, 2023, the Company’s tangible equity to tangible assets ratio equaled 8.26% and the regulatory capital ratios of both the Company and the Bank were in excess of the levels required by federal banking regulators to be classified as “well-capitalized” under regulatory guidelines.
This earnings release should be read in conjunction with Kearny Financial Corp.’s Q2 2024 Investor Presentation, a copy of which is available through the Investor Relations link located at the bottom of the page of our website at www.kearnybank.com and via a Current Report on Form 8-K on the website of the Securities and Exchange Commission at www.sec.gov.
Statements contained in this news release that are not historical facts are forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks and uncertainties which could cause actual results to differ materially from those currently anticipated due to a number of factors, which include, but are not limited to, factors discussed in documents filed by the Company with the Securities and Exchange Commission from time to time. The Company does not undertake and specifically disclaims any obligation to update any forward-looking statement, whether written or oral, that may be made from time to time by or on behalf of the Company.
Category: Earnings
| | |
| Linked-Quarter Comparative Financial Analysis |
Kearny Financial Corp.
Consolidated Balance Sheets
(Unaudited)
| | | | | | | | | | | | | | |
(Dollars and Shares in Thousands,
Except Per Share Data) | December 31, 2023 (3) | September 30,
2023 | Variance
or Change | Variance
or Change Pct. |
| | | | |
| Assets | | | | |
| Cash and cash equivalents | $ | 73,860 | | $ | 57,219 | | $ | 16,641 | | 29.1 | % |
| Securities available for sale | 1,144,175 | | 1,215,633 | | (71,458) | | -5.9 | % |
| Securities held to maturity | 141,959 | | 143,730 | | (1,771) | | -1.2 | % |
| Loans held-for-sale | 14,030 | | 3,934 | | 10,096 | | 256.6 | % |
| Loans receivable | 5,745,629 | | 5,736,049 | | 9,580 | | 0.2 | % |
| Less: allowance for credit losses on loans | (44,867) | | (46,872) | | (2,005) | | -4.3 | % |
| Net loans receivable | 5,700,762 | | 5,689,177 | | 11,585 | | 0.2 | % |
| Premises and equipment | 45,928 | | 46,868 | | (940) | | -2.0 | % |
| Federal Home Loan Bank stock | 83,372 | | 81,509 | | 1,863 | | 2.3 | % |
| Accrued interest receivable | 30,258 | | 29,766 | | 492 | | 1.7 | % |
| Goodwill | 210,895 | | 210,895 | | — | | — | % |
| Core deposit intangible | 2,189 | | 2,323 | | (134) | | -5.8 | % |
| Bank owned life insurance | 256,064 | | 294,491 | | (38,427) | | -13.0 | % |
| Deferred income taxes, net | 46,116 | | 56,500 | | (10,384) | | -18.4 | % |
| Other real estate owned | 11,982 | | 12,956 | | (974) | | -7.5 | % |
| Other assets | 136,242 | | 129,865 | | 6,377 | | 4.9 | % |
| Total assets | $ | 7,897,832 | | $ | 7,974,866 | | $ | (77,034) | | -1.0 | % |
| | | | |
| Liabilities | | | | |
| Deposits: | | | | |
| Non-interest-bearing | $ | 584,130 | | $ | 595,141 | | $ | (11,011) | | -1.9 | % |
| Interest-bearing | 4,735,500 | | 4,839,027 | | (103,527) | | -2.1 | % |
| Total deposits | 5,319,630 | | 5,434,168 | | (114,538) | | -2.1 | % |
| Borrowings | 1,667,055 | | 1,626,933 | | 40,122 | | 2.5 | % |
| Advance payments by borrowers for taxes | 16,742 | | 16,907 | | (165) | | -1.0 | % |
| Other liabilities | 46,427 | | 47,324 | | (897) | | -1.9 | % |
| Total liabilities | 7,049,854 | | 7,125,332 | | (75,478) | | -1.1 | % |
| | | | |
| Stockholders' Equity | | | | |
| Common stock | 645 | | 652 | | (7) | | -1.1 | % |
| Paid-in capital | 493,297 | | 497,269 | | (3,972) | | -0.8 | % |
| Retained earnings | 439,755 | | 460,464 | | (20,709) | | -4.5 | % |
| Unearned ESOP shares | (21,889) | | (22,375) | | 486 | | 2.2 | % |
| Accumulated other comprehensive loss | (63,830) | | (86,476) | | 22,646 | | 26.2 | % |
| Total stockholders' equity | 847,978 | | 849,534 | | (1,556) | | -0.2 | % |
| Total liabilities and stockholders' equity | $ | 7,897,832 | | $ | 7,974,866 | | $ | (77,034) | | -1.0 | % |
| | | | |
| Consolidated capital ratios | | | | |
| Equity to assets | 10.74 | % | 10.65 | % | 0.09 | % | |
Tangible equity to tangible assets (1) | 8.26 | % | 8.20 | % | 0.06 | % | |
| | | | |
| Share data | | | | |
| Outstanding shares | 64,445 | 65,132 | (687) | -1.1 | % |
| Book value per share | $ | 13.16 | | $ | 13.04 | | $ | 0.12 | | 0.9 | % |
Tangible book value per share (2) | $ | 9.85 | | $ | 9.77 | | $ | 0.08 | | 0.8 | % |
_________________________
(1)Tangible equity equals total stockholders' equity reduced by goodwill and core deposit intangible assets. Tangible assets equals total assets reduced by goodwill and core deposit intangible assets.
(2)Tangible book value equals total stockholders' equity reduced by goodwill and core deposit intangible assets.
(3)December 31, 2023 amounts include the impact of the revision previously mentioned in this earnings release.
Kearny Financial Corp.
Consolidated Statements of Income (Loss)
(Unaudited)
| | | | | | | | | | | | | | |
(Dollars and Shares in Thousands,
Except Per Share Data) | Three Months Ended | Variance
or Change | Variance
or Change Pct. |
December 31, 2023 (1) | September 30,
2023 |
| Interest income | | | | |
| Loans | $ | 63,384 | | $ | 62,769 | | $ | 615 | | 1.0 | % |
| Taxable investment securities | 16,756 | | 16,265 | | 491 | | 3.0 | % |
| Tax-exempt investment securities | 84 | | 87 | | (3) | | -3.4 | % |
| Other interest-earning assets | 2,401 | | 2,047 | | 354 | | 17.3 | % |
| Total interest income | 82,625 | | 81,168 | | 1,457 | | 1.8 | % |
| | | | |
| Interest expense | | | | |
| Deposits | 30,340 | | 27,567 | | 2,773 | | 10.1 | % |
| Borrowings | 16,446 | | 14,441 | | 2,005 | | 13.9 | % |
| Total interest expense | 46,786 | | 42,008 | | 4,778 | | 11.4 | % |
| Net interest income | 35,839 | | 39,160 | | (3,321) | | -8.5 | % |
| Provision for credit losses | 2,105 | | 245 | | 1,860 | | 759.2 | % |
| Net interest income after provision for credit losses | 33,734 | | 38,915 | | (5,181) | | -13.3 | % |
| | | | |
| Non-interest income | | | | |
| Fees and service charges | 624 | | 748 | | (124) | | -16.6 | % |
| Loss on sale and call of securities | (18,135) | | — | | (18,135) | | — | % |
| Gain on sale of loans | 104 | | 215 | | (111) | | -51.6 | % |
| Loss on sale of other real estate owned | (974) | | — | | (974) | | — | % |
| Income from bank owned life insurance | 1,162 | | 1,666 | | (504) | | -30.3 | % |
| Electronic banking fees and charges | 396 | | 367 | | 29 | | 7.9 | % |
| Other income | 811 | | 1,014 | | (203) | | -20.0 | % |
| Total non-interest income | (16,012) | | 4,010 | | (20,022) | | -499.3 | % |
| | | | |
| Non-interest expense | | | | |
| Salaries and employee benefits | 17,282 | | 17,761 | | (479) | | -2.7 | % |
| Net occupancy expense of premises | 2,674 | | 2,758 | | (84) | | -3.0 | % |
| Equipment and systems | 3,814 | | 3,801 | | 13 | | 0.3 | % |
| Advertising and marketing | 301 | | 228 | | 73 | | 32.0 | % |
| Federal deposit insurance premium | 1,495 | | 1,524 | | (29) | | -1.9 | % |
| Directors' compensation | 393 | | 393 | | — | | — | % |
| Other expense | 3,808 | | 3,309 | | 499 | | 15.1 | % |
| Total non-interest expense | 29,767 | | 29,774 | | (7) | | — | % |
| (Loss) income before income taxes | (12,045) | | 13,151 | | (25,196) | | -191.6 | % |
| Income taxes | 1,782 | | 3,309 | | (1,527) | | -46.1 | % |
| Net (loss) income | $ | (13,827) | | $ | 9,842 | | $ | (23,669) | | -240.5 | % |
| | | | |
| Net (loss) income per common share (EPS) | | | | |
| Basic | $ | (0.22) | | $ | 0.16 | | $ | (0.38) | | |
| Diluted | $ | (0.22) | | $ | 0.16 | | $ | (0.38) | | |
| | | | |
| Dividends declared | | | | |
| Cash dividends declared per common share | $ | 0.11 | | $ | 0.11 | | $ | — | | |
| Cash dividends declared | $ | 6,882 | | $ | 6,989 | | $ | (107) | | |
| Dividend payout ratio | -49.8 | % | 71.0 | % | -120.8 | % | |
| | | | |
| Weighted average number of common shares outstanding | | | | |
| Basic | 62,299 | 63,014 | (715) | |
| Diluted | 62,367 | 63,061 | (694) | |
_________________________
(1)December 31, 2023 amounts include the impact of the revision previously mentioned in this earnings release.
Kearny Financial Corp.
Average Balance Sheet Data
(Unaudited)
| | | | | | | | | | | | | | |
| (Dollars in Thousands) | Three Months Ended | Variance
or Change | Variance
or Change Pct. |
December 31, 2023 (1) | September 30,
2023 |
| Assets | | | | |
| Interest-earning assets: | | | | |
| Loans receivable, including loans held for sale | $ | 5,726,321 | | $ | 5,788,074 | | $ | (61,753) | | -1.1 | % |
| Taxable investment securities | 1,509,165 | | 1,516,393 | | (7,228) | | -0.5 | % |
| Tax-exempt investment securities | 15,025 | | 15,483 | | (458) | | -3.0 | % |
| Other interest-earning assets | 139,740 | | 130,829 | | 8,911 | | 6.8 | % |
| Total interest-earning assets | 7,390,251 | | 7,450,779 | | (60,528) | | -0.8 | % |
| Non-interest-earning assets | 554,335 | | 568,723 | | (14,388) | | -2.5 | % |
| Total assets | $ | 7,944,586 | | $ | 8,019,502 | | $ | (74,916) | | -0.9 | % |
| | | | |
| Liabilities and Stockholders' Equity | | | | |
| Interest-bearing liabilities: | | | | |
| Deposits: | | | | |
| Interest-bearing demand | $ | 2,301,169 | | $ | 2,245,831 | | $ | 55,338 | | 2.5 | % |
| Savings | 664,926 | | 719,508 | | (54,582) | | -7.6 | % |
| Certificates of deposit | 1,824,316 | | 1,968,512 | | (144,196) | | -7.3 | % |
| Total interest-bearing deposits | 4,790,411 | | 4,933,851 | | (143,440) | | -2.9 | % |
| Borrowings: | | | | |
| Federal Home Loan Bank advances | 1,513,497 | | 1,386,473 | | 127,024 | | 9.2 | % |
| Other borrowings | 142,283 | | 158,098 | | (15,815) | | -10.0 | % |
| Total borrowings | 1,655,780 | | 1,544,571 | | 111,209 | | 7.2 | % |
| Total interest-bearing liabilities | 6,446,191 | | 6,478,422 | | (32,231) | | -0.5 | % |
| Non-interest-bearing liabilities: | | | | |
| Non-interest-bearing deposits | 597,294 | | 612,251 | | (14,957) | | -2.4 | % |
| Other non-interest-bearing liabilities | 62,387 | | 66,701 | | (4,314) | | -6.5 | % |
| Total non-interest-bearing liabilities | 659,681 | | 678,952 | | (19,271) | | -2.8 | % |
| Total liabilities | 7,105,872 | | 7,157,374 | | (51,502) | | -0.7 | % |
| Stockholders' equity | 838,714 | | 862,128 | | (23,414) | | -2.7 | % |
| Total liabilities and stockholders' equity | $ | 7,944,586 | | $ | 8,019,502 | | $ | (74,916) | | -0.9 | % |
| | | | |
| Average interest-earning assets to average interest-bearing liabilities | 114.65 | % | 115.01 | % | -0.36 | % | -0.3 | % |
_________________________
(1)December 31, 2023 amounts include the impact of the revision previously mentioned in this earnings release.
Kearny Financial Corp.
Performance Ratio Highlights
(Unaudited)
| | | | | | | | | | | |
| Three Months Ended | Variance
or Change |
| December 31, 2023 (6) | September 30,
2023 |
| Average yield on interest-earning assets: | | | |
| Loans receivable, including loans held for sale | 4.43 | % | 4.34 | % | 0.09 | % |
| Taxable investment securities | 4.44 | % | 4.29 | % | 0.15 | % |
Tax-exempt investment securities (1) | 2.25 | % | 2.25 | % | — | % |
| Other interest-earning assets | 6.87 | % | 6.26 | % | 0.61 | % |
| Total interest-earning assets | 4.47 | % | 4.36 | % | 0.11 | % |
| | | |
| Average cost of interest-bearing liabilities: | | | |
| Deposits: | | | |
| Interest-bearing demand | 2.91 | % | 2.58 | % | 0.33 | % |
| Savings | 0.44 | % | 0.47 | % | -0.03 | % |
| Certificates of deposit | 2.82 | % | 2.49 | % | 0.33 | % |
| Total interest-bearing deposits | 2.53 | % | 2.23 | % | 0.30 | % |
| Borrowings: | | | |
| Federal Home Loan Bank advances | 3.82 | % | 3.54 | % | 0.28 | % |
| Other borrowings | 5.65 | % | 5.46 | % | 0.19 | % |
| Total borrowings | 3.97 | % | 3.74 | % | 0.23 | % |
| Total interest-bearing liabilities | 2.90 | % | 2.59 | % | 0.31 | % |
| | | |
Interest rate spread (2) | 1.57 | % | 1.77 | % | -0.20 | % |
Net interest margin (3) | 1.94 | % | 2.10 | % | -0.16 | % |
| | | |
| Non-interest income to average assets (annualized) | -0.81 | % | 0.20 | % | -1.01 | % |
| Non-interest expense to average assets (annualized) | 1.50 | % | 1.49 | % | 0.01 | % |
| | | |
Efficiency ratio (4) | 150.13 | % | 68.97 | % | 81.16 | % |
| | | |
| Return on average assets (annualized) | -0.70 | % | 0.49 | % | -1.19 | % |
| Return on average equity (annualized) | -6.59 | % | 4.57 | % | -11.16 | % |
Return on average tangible equity (annualized) (5) | -8.84 | % | 6.07 | % | -14.91 | % |
_________________________
(1)The yield on tax-exempt investment securities has not been adjusted to reflect their tax-effective yield.
(2)Interest income divided by average interest-earning assets less interest expense divided by average interest-bearing liabilities.
(3)Net interest income divided by average interest-earning assets.
(4)Non-interest expense divided by the sum of net interest income and non-interest income.
(5)Average tangible equity equals total average stockholders’ equity reduced by average goodwill and average core deposit intangible assets.
(6)December 31, 2023 amounts include the impact of the revision previously mentioned in this earnings release.
| | |
|
| Five-Quarter Financial Trend Analysis |
Kearny Financial Corp.
Consolidated Balance Sheets
| | | | | | | | | | | | | | | | | |
(Dollars and Shares in Thousands,
Except Per Share Data) | December 31, 2023 (3) | September 30,
2023 | June 30,
2023 | March 31,
2023 | December 31,
2022 |
| (Unaudited) | (Unaudited) | (Audited) | (Unaudited) | (Unaudited) |
| Assets | | | | | |
| Cash and cash equivalents | $ | 73,860 | | $ | 57,219 | | $ | 70,515 | | $ | 194,568 | | $ | 75,660 | |
| Securities available for sale | 1,144,175 | | 1,215,633 | | 1,227,729 | | 1,267,066 | | 1,286,354 | |
| Securities held to maturity | 141,959 | | 143,730 | | 146,465 | | 149,764 | | 153,786 | |
| Loans held-for-sale | 14,030 | | 3,934 | | 9,591 | | 5,401 | | 12,940 | |
| Loans receivable | 5,745,629 | | 5,736,049 | | 5,829,421 | | 5,966,325 | | 5,984,133 | |
| Less: allowance for credit losses on loans | (44,867) | | (46,872) | | (48,734) | | (49,122) | | (48,877) | |
| Net loans receivable | 5,700,762 | | 5,689,177 | | 5,780,687 | | 5,917,203 | | 5,935,256 | |
| Premises and equipment | 45,928 | | 46,868 | | 48,309 | | 49,589 | | 50,953 | |
| Federal Home Loan Bank stock | 83,372 | | 81,509 | | 71,734 | | 76,319 | | 69,022 | |
| Accrued interest receivable | 30,258 | | 29,766 | | 28,133 | | 28,794 | | 27,368 | |
| Goodwill | 210,895 | | 210,895 | | 210,895 | | 210,895 | | 210,895 | |
| Core deposit intangible | 2,189 | | 2,323 | | 2,457 | | 2,590 | | 2,732 | |
| Bank owned life insurance | 256,064 | | 294,491 | | 292,825 | | 291,220 | | 289,673 | |
| Deferred income taxes, net | 46,116 | | 56,500 | | 51,973 | | 53,151 | | 51,107 | |
| Other real estate owned | 11,982 | | 12,956 | | 12,956 | | 13,410 | | 13,410 | |
| Other assets | 136,242 | | 129,865 | | 110,546 | | 89,366 | | 110,162 | |
| Total assets | $ | 7,897,832 | | $ | 7,974,866 | | $ | 8,064,815 | | $ | 8,349,336 | | $ | 8,289,318 | |
| | | | | |
| Liabilities | | | | | |
| Deposits: | | | | | |
| Non-interest-bearing | $ | 584,130 | | $ | 595,141 | | $ | 609,999 | | $ | 617,778 | | $ | 650,950 | |
| Interest-bearing | 4,735,500 | | 4,839,027 | | 5,019,184 | | 5,185,626 | | 5,320,421 | |
| Total deposits | 5,319,630 | | 5,434,168 | | 5,629,183 | | 5,803,404 | | 5,971,371 | |
| Borrowings | 1,667,055 | | 1,626,933 | | 1,506,812 | | 1,611,692 | | 1,383,573 | |
| Advance payments by borrowers for taxes | 16,742 | | 16,907 | | 18,338 | | 18,706 | | 17,307 | |
| Other liabilities | 46,427 | | 47,324 | | 41,198 | | 49,304 | | 44,427 | |
| Total liabilities | 7,049,854 | | 7,125,332 | | 7,195,531 | | 7,483,106 | | 7,416,678 | |
| | | | | |
| Stockholders' Equity | | | | | |
| Common stock | 645 | | 652 | | 659 | | 667 | | 674 | |
| Paid-in capital | 493,297 | | 497,269 | | 503,332 | | 509,359 | | 515,332 | |
| Retained earnings | 439,755 | | 460,464 | | 457,611 | | 452,605 | | 449,489 | |
| Unearned ESOP shares | (21,889) | | (22,375) | | (22,862) | | (23,348) | | (23,834) | |
| Accumulated other comprehensive loss | (63,830) | | (86,476) | | (69,456) | | (73,053) | | (69,021) | |
| Total stockholders' equity | 847,978 | | 849,534 | | 869,284 | | 866,230 | | 872,640 | |
| Total liabilities and stockholders' equity | $ | 7,897,832 | | $ | 7,974,866 | | $ | 8,064,815 | | $ | 8,349,336 | | $ | 8,289,318 | |
| | | | | |
| Consolidated capital ratios | | | | | |
| Equity to assets | 10.74 | % | 10.65 | % | 10.78 | % | 10.37 | % | 10.53 | % |
Tangible equity to tangible assets (1) | 8.26 | % | 8.20 | % | 8.35 | % | 8.02 | % | 8.16 | % |
| | | | | |
| Share data | | | | | |
| Outstanding shares | 64,445 | 65,132 | 65,864 | 66,680 | 67,388 |
| Book value per share | $ | 13.16 | | $ | 13.04 | | $ | 13.20 | | $ | 12.99 | | $ | 12.95 | |
Tangible book value per share (2) | $ | 9.85 | | $ | 9.77 | | $ | 9.96 | | $ | 9.79 | | $ | 9.78 | |
_________________________
(1)Tangible equity equals total stockholders' equity reduced by goodwill and core deposit intangible assets. Tangible assets equals total assets reduced by goodwill and core deposit intangible assets.
(2)Tangible book value equals total stockholders' equity reduced by goodwill and core deposit intangible assets.
(3)December 31, 2023 amounts include the impact of the revision previously mentioned in this earnings release.
Kearny Financial Corp.
Supplemental Balance Sheet Highlights
(Unaudited)
| | | | | | | | | | | | | | | | | |
| (Dollars in Thousands) | December 31,
2023 | September 30,
2023 | June 30,
2023 | March 31,
2023 | December 31,
2022 |
| Loan portfolio composition: | | | | | |
| Commercial loans: | | | | | |
| Multi-family mortgage | $ | 2,651,274 | | $ | 2,699,151 | | $ | 2,761,775 | | $ | 2,835,852 | | $ | 2,851,721 | |
| Nonresidential mortgage | 947,287 | | 946,801 | | 968,574 | | 1,002,643 | | 1,017,341 | |
| Commercial business | 144,134 | | 149,229 | | 146,861 | | 162,038 | | 177,530 | |
| Construction | 221,933 | | 230,703 | | 226,609 | | 215,524 | | 186,663 | |
| Total commercial loans | 3,964,628 | | 4,025,884 | | 4,103,819 | | 4,216,057 | | 4,233,255 | |
| One- to four-family residential mortgage | 1,746,065 | | 1,689,051 | | 1,700,559 | | 1,713,343 | | 1,719,514 | |
| Consumer loans: | | | | | |
| Home equity loans | 43,517 | | 42,896 | | 43,549 | | 44,376 | | 45,690 | |
| Other consumer | 2,728 | | 2,644 | | 2,549 | | 2,592 | | 2,648 | |
| Total consumer loans | 46,245 | | 45,540 | | 46,098 | | 46,968 | | 48,338 | |
| Total loans, excluding yield adjustments | 5,756,938 | | 5,760,475 | | 5,850,476 | | 5,976,368 | | 6,001,107 | |
| Unaccreted yield adjustments | (11,309) | | (24,426) | | (21,055) | | (10,043) | | (16,974) | |
| Loans receivable, net of yield adjustments | 5,745,629 | | 5,736,049 | | 5,829,421 | | 5,966,325 | | 5,984,133 | |
| Less: allowance for credit losses on loans | (44,867) | | (46,872) | | (48,734) | | (49,122) | | (48,877) | |
| Net loans receivable | $ | 5,700,762 | | $ | 5,689,177 | | $ | 5,780,687 | | $ | 5,917,203 | | $ | 5,935,256 | |
| | | | | |
| Asset quality: | | | | | |
| Nonperforming assets: | | | | | |
| Accruing loans - 90 days and over past due | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | |
| Nonaccrual loans | 28,089 | | 37,912 | | 42,627 | | 44,026 | | 40,549 | |
| Total nonperforming loans | 28,089 | | 37,912 | | 42,627 | | 44,026 | | 40,549 | |
| Nonaccrual loans held-for-sale | 9,700 | | — | | — | | — | | 8,650 | |
| Other real estate owned | 11,982 | | 12,956 | | 12,956 | | 13,410 | | 13,410 | |
| Total nonperforming assets | $ | 49,771 | | $ | 50,868 | | $ | 55,583 | | $ | 57,436 | | $ | 62,609 | |
| | | | | |
| Nonperforming loans (% total loans) | 0.49 | % | 0.66 | % | 0.73 | % | 0.74 | % | 0.68 | % |
| Nonperforming assets (% total assets) | 0.63 | % | 0.64 | % | 0.69 | % | 0.69 | % | 0.76 | % |
| | | | | |
| Classified loans | $ | 94,676 | | $ | 98,616 | | $ | 93,526 | | $ | 103,461 | | $ | 86,069 | |
| | | | | |
| Allowance for credit losses on loans (ACL): | | | | | |
| ACL to total loans | 0.78 | % | 0.81 | % | 0.83 | % | 0.82 | % | 0.81 | % |
| ACL to nonperforming loans | 159.73 | % | 123.63 | % | 114.33 | % | 111.57 | % | 120.54 | % |
| Net charge-offs | $ | 4,110 | | $ | 2,107 | | $ | 82 | | $ | 206 | | $ | 407 | |
| Average net charge-off rate (annualized) | 0.29 | % | 0.15 | % | 0.01 | % | 0.01 | % | 0.03 | % |
Kearny Financial Corp.
Supplemental Balance Sheet Highlights
(Unaudited)
| | | | | | | | | | | | | | | | | |
| (Dollars in Thousands) | December 31,
2023 | September 30,
2023 | June 30,
2023 | March 31,
2023 | December 31,
2022 |
| Funding composition: | | | | | |
| Deposits: | | | | | |
| Non-interest-bearing deposits | $ | 584,130 | | $ | 595,141 | | $ | 609,999 | | $ | 617,778 | | $ | 650,950 | |
| Interest-bearing demand | 2,347,262 | | 2,236,573 | | 2,252,912 | | 2,285,799 | | 2,316,485 | |
| Savings | 646,182 | | 689,163 | | 748,721 | | 811,483 | | 901,514 | |
| Certificates of deposit (retail) | 1,283,676 | | 1,300,382 | | 1,377,028 | | 1,327,343 | | 1,354,907 | |
| Certificates of deposit (brokered and listing service) | 458,380 | | 612,909 | | 640,523 | | 761,001 | | 747,515 | |
| Interest-bearing deposits | 4,735,500 | | 4,839,027 | | 5,019,184 | | 5,185,626 | | 5,320,421 | |
| Total deposits | 5,319,630 | | 5,434,168 | | 5,629,183 | | 5,803,404 | | 5,971,371 | |
| | | | | |
| Borrowings: | | | | | |
| Federal Home Loan Bank advances | 1,432,055 | | 1,456,933 | | 1,281,812 | | 1,156,692 | | 1,256,573 | |
| Overnight borrowings | 235,000 | | 170,000 | | 225,000 | | 455,000 | | 127,000 | |
| Total borrowings | 1,667,055 | | 1,626,933 | | 1,506,812 | | 1,611,692 | | 1,383,573 | |
| | | | | |
| Total funding | $ | 6,986,685 | | $ | 7,061,101 | | $ | 7,135,995 | | $ | 7,415,096 | | $ | 7,354,944 | |
| | | | | |
| Loans as a % of deposits | 107.4 | % | 104.8 | % | 102.9 | % | 102.1 | % | 99.6 | % |
| Deposits as a % of total funding | 76.1 | % | 77.0 | % | 78.9 | % | 78.3 | % | 81.2 | % |
| Borrowings as a % of total funding | 23.9 | % | 23.0 | % | 21.1 | % | 21.7 | % | 18.8 | % |
| | | | | |
| Uninsured deposits: | | | | | |
Uninsured deposits (reported) (1) | $ | 1,813,122 | | $ | 1,734,288 | | $ | 1,771,416 | | $ | 1,678,051 | | $ | 1,815,854 | |
Uninsured deposits (adjusted) (2) | $ | 694,510 | | $ | 683,265 | | $ | 710,377 | | $ | 705,727 | | $ | 794,407 | |
_________________________
(1)Uninsured deposits of Kearny Bank.
(2)Uninsured deposits of Kearny Bank adjusted to exclude deposits of its wholly-owned subsidiary and holding company and collateralized deposits of state and local governments.
Kearny Financial Corp.
Consolidated Statements of Income (Loss)
(Unaudited)
| | | | | | | | | | | | | | | | | |
| Three Months Ended |
(Dollars and Shares in Thousands,
Except Per Share Data) | December 31, 2023 (1) | September 30,
2023 | June 30,
2023 | March 31,
2023 | December 31,
2022 |
| Interest income | | | | | |
| Loans | $ | 63,384 | | $ | 62,769 | | $ | 62,044 | | $ | 60,172 | | $ | 57,996 | |
| Taxable investment securities | 16,756 | | 16,265 | | 15,736 | | 15,459 | | 13,221 | |
| Tax-exempt investment securities | 84 | | 87 | | 91 | | 99 | | 219 | |
| Other interest-earning assets | 2,401 | | 2,047 | | 1,821 | | 1,441 | | 1,005 | |
| Total interest income | 82,625 | | 81,168 | | 79,692 | | 77,171 | | 72,441 | |
| | | | | |
| Interest expense | | | | | |
| Deposits | 30,340 | | 27,567 | | 26,226 | | 22,246 | | 18,822 | |
| Borrowings | 16,446 | | 14,441 | | 13,286 | | 12,554 | | 8,836 | |
| Total interest expense | 46,786 | | 42,008 | | 39,512 | | 34,800 | | 27,658 | |
| Net interest income | 35,839 | | 39,160 | | 40,180 | | 42,371 | | 44,783 | |
| Provision for (reversal of) credit losses | 2,105 | | 245 | | (306) | | 451 | | 1,671 | |
| Net interest income after provision for (reversal of) credit losses | 33,734 | | 38,915 | | 40,486 | | 41,920 | | 43,112 | |
| | | | | |
| Non-interest income | | | | | |
| Fees and service charges | 624 | | 748 | | 699 | | 910 | | 734 | |
| Loss on sale and call of securities | (18,135) | | — | | — | | — | | (15,227) | |
| Gain (loss) on sale of loans | 104 | | 215 | | 199 | | (2,373) | | 134 | |
| Loss on sale of other real estate owned | (974) | | — | | (139) | | — | | — | |
| Income from bank owned life insurance | 1,162 | | 1,666 | | 1,605 | | 1,581 | | 1,761 | |
| Electronic banking fees and charges | 396 | | 367 | | 399 | | 457 | | 397 | |
| Other income | 811 | | 1,014 | | 903 | | 1,071 | | 3,723 | |
| Total non-interest income | (16,012) | | 4,010 | | 3,666 | | 1,646 | | (8,478) | |
| | | | | |
| Non-interest expense | | | | | |
| Salaries and employee benefits | 17,282 | | 17,761 | | 17,315 | | 18,005 | | 19,921 | |
| Net occupancy expense of premises | 2,674 | | 2,758 | | 2,862 | | 3,097 | | 2,987 | |
| Equipment and systems | 3,814 | | 3,801 | | 3,511 | | 3,537 | | 3,867 | |
| Advertising and marketing | 301 | | 228 | | 231 | | 413 | | 731 | |
| Federal deposit insurance premium | 1,495 | | 1,524 | | 1,455 | | 1,546 | | 1,226 | |
| Directors' compensation | 393 | | 393 | | 345 | | 340 | | 339 | |
| Other expense | 3,808 | | 3,309 | | 3,042 | | 3,414 | | 3,579 | |
| Total non-interest expense | 29,767 | | 29,774 | | 28,761 | | 30,352 | | 32,650 | |
| (Loss) income before income taxes | (12,045) | | 13,151 | | 15,391 | | 13,214 | | 1,984 | |
| Income taxes | 1,782 | | 3,309 | | 3,378 | | 2,902 | | 33 | |
| Net (loss) income | $ | (13,827) | | $ | 9,842 | | $ | 12,013 | | $ | 10,312 | | $ | 1,951 | |
| | | | | |
| Net (loss) income per common share (EPS) | | | | | |
| Basic | $ | (0.22) | | $ | 0.16 | | $ | 0.19 | | $ | 0.16 | | $ | 0.03 | |
| Diluted | $ | (0.22) | | $ | 0.16 | | $ | 0.19 | | $ | 0.16 | | $ | 0.03 | |
| | | | | |
| Dividends declared | | | | | |
| Cash dividends declared per common share | $ | 0.11 | | $ | 0.11 | | $ | 0.11 | | $ | 0.11 | | $ | 0.11 | |
| Cash dividends declared | $ | 6,882 | | $ | 6,989 | | $ | 7,007 | | $ | 7,196 | | $ | 7,172 | |
| Dividend payout ratio | -49.8 | % | 71.0 | % | 58.3 | % | 69.8 | % | 367.6 | % |
| | | | | |
| Weighted average number of common shares outstanding | | | | | |
| Basic | 62,299 | 63,014 | 63,667 | 64,769 | 65,030 |
| Diluted | 62,367 | 63,061 | 63,667 | 64,783 | 65,038 |
_________________________
(1)December 31, 2023 amounts include the impact of the revision previously mentioned in this earnings release.
Kearny Financial Corp.
Average Balance Sheet Data
(Unaudited)
| | | | | | | | | | | | | | | | | |
| Three Months Ended |
| (Dollars in Thousands) | December 31, 2023 (1) | September 30,
2023 | June 30,
2023 | March 31,
2023 | December 31,
2022 |
| Assets | | | | | |
| Interest-earning assets: | | | | | |
| Loans receivable, including loans held-for-sale | $ | 5,726,321 | | $ | 5,788,074 | | $ | 5,932,541 | | $ | 5,986,669 | | $ | 5,839,903 | |
| Taxable investment securities | 1,509,165 | | 1,516,393 | | 1,529,582 | | 1,558,222 | | 1,527,578 | |
| Tax-exempt investment securities | 15,025 | | 15,483 | | 16,346 | | 17,663 | | 37,917 | |
| Other interest-earning assets | 139,740 | | 130,829 | | 128,158 | | 131,682 | | 114,175 | |
| Total interest-earning assets | 7,390,251 | | 7,450,779 | | 7,606,627 | | 7,694,236 | | 7,519,573 | |
| Non-interest-earning assets | 554,335 | | 568,723 | | 556,962 | | 575,009 | | 550,519 | |
| Total assets | $ | 7,944,586 | | $ | 8,019,502 | | $ | 8,163,589 | | $ | 8,269,245 | | $ | 8,070,092 | |
| | | | | |
| Liabilities and Stockholders' Equity | | | | | |
| Interest-bearing liabilities: | | | | | |
| Deposits: | | | | | |
| Interest-bearing demand | $ | 2,301,169 | | $ | 2,245,831 | | $ | 2,321,120 | | $ | 2,363,762 | | $ | 2,359,977 | |
| Savings | 664,926 | | 719,508 | | 774,854 | | 858,673 | | 931,584 | |
| Certificates of deposit | 1,824,316 | | 1,968,512 | | 2,057,818 | | 2,069,396 | | 2,192,722 | |
| Total interest-bearing deposits | 4,790,411 | | 4,933,851 | | 5,153,792 | | 5,291,831 | | 5,484,283 | |
| Borrowings: | | | | | |
| Federal Home Loan Bank advances | 1,513,497 | | 1,386,473 | | 1,374,316 | | 1,402,269 | | 997,148 | |
| Other borrowings | 142,283 | | 158,098 | | 100,055 | | 1,611 | | — | |
| Total borrowings | 1,655,780 | | 1,544,571 | | 1,474,371 | | 1,403,880 | | 997,148 | |
| Total interest-bearing liabilities | 6,446,191 | | 6,478,422 | | 6,628,163 | | 6,695,711 | | 6,481,431 | |
| Non-interest-bearing liabilities: | | | | | |
| Non-interest-bearing deposits | 597,294 | | 612,251 | | 608,765 | | 634,324 | | 666,846 | |
| Other non-interest-bearing liabilities | 62,387 | | 66,701 | | 64,970 | | 60,327 | | 56,721 | |
| Total non-interest-bearing liabilities | 659,681 | | 678,952 | | 673,735 | | 694,651 | | 723,567 | |
| Total liabilities | 7,105,872 | | 7,157,374 | | 7,301,898 | | 7,390,362 | | 7,204,998 | |
| Stockholders' equity | 838,714 | | 862,128 | | 861,691 | | 878,883 | | 865,094 | |
| Total liabilities and stockholders' equity | $ | 7,944,586 | | $ | 8,019,502 | | $ | 8,163,589 | | $ | 8,269,245 | | $ | 8,070,092 | |
| | | | | |
| Average interest-earning assets to average interest-bearing liabilities | 114.65 | % | 115.01 | % | 114.76 | % | 114.91 | % | 116.02 | % |
_________________________
(1)December 31, 2023 amounts include the impact of the revision previously mentioned in this earnings release.
Kearny Financial Corp.
Performance Ratio Highlights
| | | | | | | | | | | | | | | | | |
| Three Months Ended |
| December 31, 2023 (6) | September 30,
2023 | June 30,
2023 | March 31,
2023 | December 31,
2022 |
| Average yield on interest-earning assets: | | | | | |
| Loans receivable, including loans held-for-sale | 4.43 | % | 4.34 | % | 4.18 | % | 4.02 | % | 3.97 | % |
| Taxable investment securities | 4.44 | % | 4.29 | % | 4.12 | % | 3.97 | % | 3.46 | % |
Tax-exempt investment securities (1) | 2.25 | % | 2.25 | % | 2.23 | % | 2.23 | % | 2.32 | % |
| Other interest-earning assets | 6.87 | % | 6.26 | % | 5.68 | % | 4.38 | % | 3.52 | % |
| Total interest-earning assets | 4.47 | % | 4.36 | % | 4.19 | % | 4.01 | % | 3.85 | % |
| | | | | |
| Average cost of interest-bearing liabilities: | | | | | |
| Deposits: | | | | | |
| Interest-bearing demand | 2.91 | % | 2.58 | % | 2.38 | % | 2.01 | % | 1.63 | % |
| Savings | 0.44 | % | 0.47 | % | 0.48 | % | 0.41 | % | 0.41 | % |
| Certificates of deposit | 2.82 | % | 2.49 | % | 2.24 | % | 1.84 | % | 1.50 | % |
| Total interest-bearing deposits | 2.53 | % | 2.23 | % | 2.04 | % | 1.68 | % | 1.37 | % |
| Borrowings: | | | | | |
| Federal Home Loan Bank advances | 3.82 | % | 3.54 | % | 3.51 | % | 3.58 | % | 3.54 | % |
| Other borrowings | 5.65 | % | 5.46 | % | 4.89 | % | 5.15 | % | — | % |
| Total borrowings | 3.97 | % | 3.74 | % | 3.60 | % | 3.58 | % | 3.54 | % |
| Total interest-bearing liabilities | 2.90 | % | 2.59 | % | 2.38 | % | 2.08 | % | 1.71 | % |
| | | | | |
Interest rate spread (2) | 1.57 | % | 1.77 | % | 1.81 | % | 1.93 | % | 2.14 | % |
Net interest margin (3) | 1.94 | % | 2.10 | % | 2.11 | % | 2.20 | % | 2.38 | % |
| | | | | |
| Non-interest income to average assets (annualized) | -0.81 | % | 0.20 | % | 0.18 | % | 0.08 | % | -0.42 | % |
| Non-interest expense to average assets (annualized) | 1.50 | % | 1.49 | % | 1.41 | % | 1.47 | % | 1.62 | % |
| | | | | |
Efficiency ratio (4) | 150.13 | % | 68.97 | % | 65.60 | % | 68.96 | % | 89.93 | % |
| | | | | |
| Return on average assets (annualized) | -0.70 | % | 0.49 | % | 0.59 | % | 0.50 | % | 0.10 | % |
| Return on average equity (annualized) | -6.59 | % | 4.57 | % | 5.58 | % | 4.69 | % | 0.90 | % |
Return on average tangible equity (annualized) (5) | -8.84 | % | 6.07 | % | 7.41 | % | 6.20 | % | 1.20 | % |
_________________________
(1)The yield on tax-exempt investment securities has not been adjusted to reflect their tax-effective yield.
(2)Interest income divided by average interest-earning assets less interest expense divided by average interest-bearing liabilities.
(3)Net interest income divided by average interest-earning assets.
(4)Non-interest expense divided by the sum of net interest income and non-interest income.
(5)Average tangible equity equals total average stockholders’ equity reduced by average goodwill and average core deposit intangible assets.
(6)December 31, 2023 amounts include the impact of the revision previously mentioned in this earnings release.
The following tables provide a reconciliation of certain financial measures calculated in accordance with Generally Accepted Accounting Principles (“GAAP”) (as reported) and non-GAAP measures. These non-GAAP measures provide additional information which allow readers to evaluate the ongoing performance of the Company. They are not a substitute for GAAP measures; they should be read and used in conjunction with the Company’s GAAP financial information. In all cases, it should be understood that non-GAAP per share measures do not depict amounts that accrue directly to the benefit of shareholders.
Kearny Financial Corp.
Reconciliation of GAAP to Non-GAAP
(Unaudited)
| | | | | | | | | | | | | | | | | |
| Three Months Ended |
(Dollars and Shares in Thousands,
Except Per Share Data) | December 31, 2023 (1) | September 30,
2023 | June 30,
2023 | March 31,
2023 | December 31,
2022 |
| Adjusted net income: | | | | | |
| Net (loss) income (GAAP) | $ | (13,827) | | $ | 9,842 | | $ | 12,013 | | $ | 10,312 | | $ | 1,951 | |
| Non-recurring transactions - net of tax: | | | | | |
| Branch consolidation expenses | — | | — | | — | | 568 | | — | |
| Net effect of sale and call of securities | 12,876 | | — | | — | | — | | 10,811 | |
| Net effect of sale of other assets | — | | — | | — | | — | | (2,081) | |
| Severance expense from workforce realignment | — | | — | | — | | — | | 538 | |
| Net effect of bank-owned life insurance restructure | 6,286 | | — | | — | | — | | — | |
| Adjusted net income | $ | 5,335 | | $ | 9,842 | | $ | 12,013 | | $ | 10,880 | | $ | 11,219 | |
| | | | | |
| Calculation of pre-tax, pre-provision net revenue: | | | | | |
| Net (loss) income (GAAP) | $ | (13,827) | | $ | 9,842 | | $ | 12,013 | | $ | 10,312 | | $ | 1,951 | |
| Adjustments to net income (GAAP): | | | | | |
| Provision for income taxes | 1,782 | | 3,309 | | 3,378 | | 2,902 | | 33 | |
| Provision for (reversal of) credit losses | 2,105 | | 245 | | (306) | | 451 | | 1,671 | |
| Pre-tax, pre-provision net revenue (non-GAAP) | $ | (9,940) | | $ | 13,396 | | $ | 15,085 | | $ | 13,665 | | $ | 3,655 | |
| | | | | |
| Adjusted earnings per share: | | | | | |
| Weighted average common shares - basic | 62,299 | 63,014 | 63,667 | 64,769 | 65,030 |
| Weighted average common shares - diluted | 62,367 | 63,061 | 63,667 | 64,783 | 65,038 |
| | | | | |
| Earnings per share - basic (GAAP) | $ | (0.22) | | $ | 0.16 | | $ | 0.19 | | $ | 0.16 | | $ | 0.03 | |
| Earnings per share - diluted (GAAP) | $ | (0.22) | | $ | 0.16 | | $ | 0.19 | | $ | 0.16 | | $ | 0.03 | |
| | | | | |
| Adjusted earnings per share - basic (non-GAAP) | $ | 0.09 | | $ | 0.16 | | $ | 0.19 | | $ | 0.17 | | $ | 0.17 | |
| Adjusted earnings per share - diluted (non-GAAP) | $ | 0.09 | | $ | 0.16 | | $ | 0.19 | | $ | 0.17 | | $ | 0.17 | |
| | | | | |
| Pre-tax, pre-provision net revenue per share: | | | | | |
| Pre-tax, pre-provision net revenue per share - basic (non-GAAP) | $ | (0.16) | | $ | 0.21 | | $ | 0.24 | | $ | 0.21 | | $ | 0.06 | |
| Pre-tax, pre-provision net revenue per share - diluted (non-GAAP) | $ | (0.16) | | $ | 0.21 | | $ | 0.24 | | $ | 0.21 | | $ | 0.06 | |
| | | | | |
| Adjusted return on average assets: | | | | | |
| Total average assets | $ | 7,944,586 | | $ | 8,019,502 | | $ | 8,163,589 | | $ | 8,269,245 | | $ | 8,070,092 | |
| | | | | |
| Return on average assets (GAAP) | -0.70 | % | 0.49 | % | 0.59 | % | 0.50 | % | 0.10 | % |
| Adjusted return on average assets (non-GAAP) | 0.27 | % | 0.49 | % | 0.59 | % | 0.53 | % | 0.56 | % |
| | | | | |
| Adjusted return on average equity: | | | | | |
| Total average equity | $ | 838,714 | | $ | 862,128 | | $ | 861,691 | | $ | 878,883 | | $ | 865,094 | |
| | | | | |
| Return on average equity (GAAP) | -6.59 | % | 4.57 | % | 5.58 | % | 4.69 | % | 0.90 | % |
| Adjusted return on average equity (non-GAAP) | 2.54 | % | 4.57 | % | 5.58 | % | 4.95 | % | 5.19 | % |
_________________________
(1)December 31, 2023 amounts include the impact of the revision previously mentioned in this earnings release.
Kearny Financial Corp.
Reconciliation of GAAP to Non-GAAP
(Unaudited)
| | | | | | | | | | | | | | | | | |
| Three Months Ended |
(Dollars and Shares in Thousands,
Except Per Share Data) | December 31, 2023 (1) | September 30,
2023 | June 30,
2023 | March 31,
2023 | December 31,
2022 |
| Adjusted return on average tangible equity: | | | | | |
| Total average equity | $ | 838,714 | | $ | 862,128 | | $ | 861,691 | | $ | 878,883 | | $ | 865,094 | |
| Less: average goodwill | (210,895) | | (210,895) | | (210,895) | | (210,895) | | (210,895) | |
| Less: average other intangible assets | (2,277) | | (2,411) | | (2,544) | | (2,683) | | (2,826) | |
| Total average tangible equity | $ | 625,542 | | $ | 648,822 | | $ | 648,252 | | $ | 665,305 | | $ | 651,373 | |
| | | | | |
| Return on average tangible equity (non-GAAP) | -8.84 | % | 6.07 | % | 7.41 | % | 6.20 | % | 1.20 | % |
| Adjusted return on average tangible equity (non-GAAP) | 3.41 | % | 6.07 | % | 7.41 | % | 6.54 | % | 6.89 | % |
| | | | | |
| Adjusted non-interest expense ratio: | | | | | |
| Non-interest expense (GAAP) | $ | 29,767 | | $ | 29,774 | | $ | 28,761 | | $ | 30,352 | | $ | 32,650 | |
| Non-recurring transactions: | | | | | |
| Branch consolidation expenses | — | | — | | — | | (800) | | — | |
| Severance expense from workforce realignment | — | | — | | — | | — | | (757) | |
| | | | | |
| Non-interest expense (non-GAAP) | $ | 29,767 | | $ | 29,774 | | $ | 28,761 | | $ | 29,552 | | $ | 31,893 | |
| | | | | |
| Non-interest expense ratio (GAAP) | 1.50 | % | 1.49 | % | 1.41 | % | 1.47 | % | 1.62 | % |
| Adjusted non-interest expense ratio (non-GAAP) | 1.50 | % | 1.49 | % | 1.41 | % | 1.43 | % | 1.58 | % |
| | | | | |
| Adjusted efficiency ratio: | | | | | |
| Non-interest expense (non-GAAP) | $ | 29,767 | | $ | 29,774 | | $ | 28,761 | | $ | 29,552 | | $ | 31,893 | |
| | | | | |
| Net interest income (GAAP) | $ | 35,839 | | $ | 39,160 | | $ | 40,180 | | $ | 42,371 | | $ | 44,783 | |
| Total non-interest income (GAAP) | (16,012) | | 4,010 | | 3,666 | | 1,646 | | (8,478) | |
| Non-recurring transactions: | | | | | |
| Net effect of sale and call of securities | 18,135 | | — | | — | | — | | 15,227 | |
| Net effect of sale of other assets | — | | — | | — | | — | | (2,931) | |
| Net effect of bank-owned life insurance restructure | 573 | | — | | — | | — | | — | |
| Total revenue (non-GAAP) | $ | 38,535 | | $ | 43,170 | | $ | 43,846 | | $ | 44,017 | | $ | 48,601 | |
| | | | | |
| Efficiency ratio (GAAP) | 150.13 | % | 68.97 | % | 65.60 | % | 68.96 | % | 89.93 | % |
| Adjusted efficiency ratio (non-GAAP) | 77.25 | % | 68.97 | % | 65.60 | % | 67.14 | % | 65.62 | % |
_________________________
(1)December 31, 2023 amounts include the impact of the revision previously mentioned in this earnings release.
JANUARY 31, 2024 I N V E S T O R P R E S E N T A T I O N S E C O N D Q U A R T E R F I S C A L 2 0 2 4 EXHIBIT 99.2
Forward Looking Statements & Financial Measures 2 This presentation may include certain “forward-looking statements,” which are made in good faith by Kearny Financial Corp. (the “Company”) pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties, such as statements of the Company’s plans, objectives, expectations, estimates and intentions that are subject to change based on various important factors (some of which are beyond the Company’s control). In addition to the factors described under Item 1A. Risk Factors in the Company’s Annual Report on Form 10-K, and subsequent filings with the Securities and Exchange Commission, the following factors, among others, could cause the Company’s financial performance to differ materially from the plans, objectives, expectations, estimates and intentions expressed in such forward-looking statements: • the strength of the United States economy in general and the strength of the local economy in which the Company conducts operations, • the effects of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System, inflation, interest rates, market and monetary fluctuations, • the impact of changes in laws, regulations and government policies regarding financial institutions (including laws concerning taxation, banking, securities and insurance), • changes in accounting policies and practices, as may be adopted by regulatory agencies, the Financial Accounting Standards Board (“FASB”) or the Public Company Accounting Oversight Board, • technological changes, • competition among financial services providers, and • the success of the Company at managing the risks involved in the foregoing and managing its business. The Company cautions that the foregoing list of important factors is not exhaustive. Readers should not place any undue reliance on any forward looking statements, which speak only as of the date made. The Company does not undertake any obligation to update any forward-looking statement, whether written or oral, that may be made from time to time by or on behalf of the Company.
Kearny Financial Corp. NASDAQ: KRNY Market Cap: $531.7 million1 Founded in 1884 Top 10 New Jersey-based financial institution by assets 43 full-service branches2 in 12 counties throughout New Jersey and New York City Active acquirer, having completed 7 whole-bank acquisitions since 1999 1 As of January 23, 2024. 2 As of December 31, 2023. Source: S&P Global Market Intelligence & Company Filings. 3
140 Years of Serving our Communities and Clients 4
2Q24 Financial Highlights 1 Excludes Yield Adjustments. Source: Company Filings. 5 Strategic Actions Taken During the Quarter: Investment Securities Repositioning - Sold $122.2 million of available-for-sale debt securities. Proceeds were used to retire higher-cost wholesale funding and to reinvest into loans yielding current market rates. Bank-Owned Life Insurance (“BOLI”) Restructuring - $103.4 million of BOLI policies yielding 2.1% were exchanged or surrendered and replaced with policies yielding 5.1%. Resolution of Non-performing Assets - Under contract to sell a $12.0 million Other Real Estate Owned asset and reclassified $9.7 million of non-performing commercial real estate loans to held-for-sale. Hedging Activities - Added cash flows swaps and interest rate floor spreads to hedge a portion of wholesale funding and mitigate the interest rate risk associated with a modest decrease in short-term rates. Net Loss Total Assets $7.9 billion Net Interest Income Diluted EPS -$13.8 million $35.8 million -$0.22 Total Loans1 Total Deposits $5.7 billion $5.3 billion
Equity & Capitalization Equity Capitalization Level 1 Kearny Financial Corp. (NASDAQ: KRNY) Regulatory Capital Ratios as of December 31, 2023 are preliminary. 2 S&P U.S. Small Cap Banks Index comprised of 246 constituents, based on September 30, 2023 results. Source: Company Filings. 6 Regulatory Capital Ratios1,2 8.89% 14.42% 14.42% 15.17% 9.62% 11.37% 11.60% 14.04% Tier 1 Leverage Common Equity Tier 1 Tier 1 Risk-Based Capital Total Risk-Based Capital KRNY S&P US Small Cap Banks 8.16% 8.02% 8.35% 8.20% 8.26% 10.53% 10.37% 10.78% 10.65% 10.74% 2Q23 3Q23 4Q23 1Q24 2Q24 Tangible Common Equity / Tangible Assets Equity / Assets
Deposits 1 For the quarter ended December 31, 2023. 2 As of December 31, 2023; excludes Wholesale and state & local government deposits. Source: S&P Global Market Intelligence & Company Filings. 7 Deposit Composition1 Deposit Trend Deposit Segmentation2 Consumer 60.9% Commercial 20.7% Government 18.4% Product # of Accounts Balance ($ millions) Average Balance per Account Checking 53,249 $ 2,282 $ 42,863 Savings 32,687 638 19,510 CD 26,723 1,281 47,939 Total Retail Deposits 112,659 $ 4,201 $ 37,291 Non-Maturity Account Deposit Mix $1,355 $1,327 $1,377 $1,300 $1,284 $747 $761 $640 $613 $458 $902 $811 $749 $689 $646 $2,316 $2,286 $2,253 $2,237 $2,348 $651 $618 $610 $595 $584 $5,971 $5,803 $5,629 $5,434 $5,320 2Q23 3Q23 4Q23 1Q24 2Q24 Wholesale CDs Savings Interest Bearing DDA Non-interest Bearing DDA ($ millions) QTD Cost of Deposits 2.53% Retail CDs 24.1% Wholesale CDs 8.6% Savings 12.1% Interest Bearing DDA 44.2% Non-interest Bearing DDA 11.0%
Liquidity Available for Uninsured Deposits Estimated Uninsured Deposits Analysis2 1 Estimated amount of uninsured deposits reported in December 31, 2023 Call Report. 2 As of December 31, 2023. 8 Available liquidity is 2.6x greater than estimated uninsured deposits (excluding items above) Liquidity Capacity2 Sources of Liquidity ($ millions) Liquidity Capacity Funding Utilized Available Capacity Internal Sources: Free Securities and other 401$ -$ 401$ External Sources: FRB 405 - 405 FHLB 2,641 1,668 973 Total Liquidity 3,447$ 1,668$ 1,779$ Estimated Uninsured Deposit Analysis ($ millions) Estimated Uninsured Deposits 1,813$ Less: Collateralized State & Local Government Deposits (644) Less: Bank's wholly-owned subsidiary & Holding Company Deposits (474) Estimated uninsured deposits excluding items above: 695$ Total Deposits 5,320$ Estimated uninsured deposits, excluding items above, as a % of Total Deposits 13.1% 1
Investment Securities 1 As of December 31, 2023. 2 Comprised entirely of securitized federal education loans with 97% U.S. government guarantees. 3 Assumes 29% marginal tax rate. Source: S&P Global Market Intelligence & Company Filings. 9 2 Securities Composition1 Securities Average Balance & Yield TrendAFS/HTM & Effective Duration At December 31, 2023, the after-tax net unrecognized loss on securities held-to-maturity was $10.0 million, or 1.56% of tangible equity3 $1,565 $1,576 $1,546 $1,532 $1,524 3.43% 3.95% 4.10% 4.27% 4.42% 2Q23 3Q23 4Q23 1Q24 2Q24 ($ millions) Total Effective Duration ≈ 3.2 years Floating rate securities ≈ 38.9% Corporate Bonds 10.3% CLO 32.9% ABS Student Loans 7.2% Agency MBS 48.4% Municipal Bonds 1.2% AFS , 89.0% HTM , 11.0% QTD Yield on Securities 4.42%
Portfolio Lending Loan Composition1 Geographic Distribution2Loan Trend 1 For the quarter ended December 31, 2023. 2 As of December 31, 2023. Source: S&P Global Market Intelligence & Company Filings. 10 ($ millions) New York (Ex. Brooklyn) 16.8% Brooklyn 17.6% New Jersey 55.2% Pennsylvania 5.7% Other 4.7% $1,720 $1,713 $1,701 $1,689 $1,746 $2,852 $2,836 $2,762 $2,699 $2,651 $1,017 $1,003 $969 $947 $947 $6,001 $5,976 $5,850 $5,760 $5,757 2Q23 3Q23 4Q23 1Q24 2Q24 1-4 Family Home Equity Multi-family CRE Construction C&I 1-4 Family 30.3% Home Equity 0.8% Multi-family 46.0% CRE 16.4% Construction 3.9% C&I 2.5% QTD Yield on Loans 4.43% LTV 61.4%
CRE Lending 1 As of December 31, 2023. Source: Company Filings. 11 CRE Portfolio by Collateral Type1 CRE Loan Geographic Distribution1 Total CRE $0.9 B New Jersey 56.1% Brooklyn 9.9% New York (Ex. Brooklyn) 27.6% Pennsylvania 3.8% Other 2.6%Retail 36.6% Mixed Use 27.1% Office 15.8% Industrial 14.8% Specialty & Other 2.1% Medical 3.6%
Asset Quality Net Charge-Offs / Average Loans Non-Performing Assets / Total Assets Non-Performing Loans1 Allowance for Credit Losses 1 As of December 31, 2023; amounts shown in millions. Source: S&P Global Market Intelligence & Company Filings. 12 0.03% 0.01% 0.01% 0.15% 0.29% -0.05% 0.05% 0.15% 0.25% 0.35% 2Q23 3Q23 4Q23 1Q24 2Q24 Multi-family $16.1 CRE $4.3 C&I $0.8 1-4 Family $6.9 NPL's $28.1 MM 0.76% 0.69% 0.69% 0.64% 0.63% 0.25% 0.50% 0.75% 1.00% 2Q23 3Q23 4Q23 1Q24 2Q24 Increase driven by a single commercial real estate credit relationship $46.0 $46.6 $45.3 $45.0 $44.7 $2.9 $2.5 $3.4 $1.9 $0.2 0.81% 0.82% 0.83% 0.81% 0.78% 0.00% 0.20% 0.40% 0.60% 0.80% 1.00% $0.0 $20.0 $40.0 $60.0 $80.0 $100.0 2Q23 3Q23 4Q23 1Q24 2Q24 ACL Balance - Individually Analyzed ACL Balance - Collectively Evaluated ACL to Total Loans Receivable ($ millions)
v3.24.0.1
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Jan. 25, 2024 |
| Cover [Abstract] |
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| Document Period End Date |
Jan. 25, 2024
|
| Entity Registrant Name |
KEARNY FINANCIAL CORP.
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| Entity Incorporation, State or Country Code |
MD
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| Entity File Number |
001-37399
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| Entity Tax Identification Number |
30-0870244
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| Entity Address, Address Line One |
120 Passaic Avenue
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Fairfield
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NJ
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07004
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(973)
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| Local Phone Number |
244-4500
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| Amendment Description |
EXPLANATORY NOTEOn January 25, 2024, Kearny Financial Corp. (the “Company”), the holding company for Kearny Bank, issued a press release reporting its financial results for the quarter ended December 31, 2023 (the “Original Earnings Release”). A copy of the Original Earnings Release was furnished by the Company with a Current Report on Form 8-K on January 25, 2024 (the “Original 8-K”). On January 31, 2024, the Company issued a press release (the “Revised Earnings Release”), revising the Original Earnings Release, to adjust the timing of income recognition associated with a $4.8 million non-recurring increase in cash surrender value (the “enhancement fee”) associated with restructuring of its Bank-Owned Life Insurance ("BOLI") portfolio that was originally recognized as non-interest income during the quarter.During the quarter ended December 31, 2023, the Company recorded a $4.8 million non-recurring increase in BOLI cash surrender value and recognized the enhancement fee within non-interest income. Subsequent to the issuance of the Original Earnings Release, the Company continued to evaluate the matter and determined it was necessary to revise its accounting for the enhancement fee and derecognize the enhancement fee and the increase in BOLI cash surrender value initially recorded in the financial statements as of and for the quarter ended December 31, 2023. As a result, the $4.8 million enhancement fee will be recognized prospectively as non-interest income in future periods.The sole purpose of this Amendment No. 1 on Form 8-K/A is to amend Items 2.02, 7.01 and 9.01 of the Original 8-K and furnish the Revised Earnings Release in place of the Original Earnings Release. No changes have been made to Item 8.01 of the Original 8-K. Except as set forth herein, no other information in the Original 8-K is being amended.
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| Period Type: |
duration |
|
| X |
- DefinitionA unique 10-digit SEC-issued value to identify entities that have filed disclosures with the SEC. It is commonly abbreviated as CIK. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 12
-Subsection b-2
| Name: |
dei_EntityCentralIndexKey |
| Namespace Prefix: |
dei_ |
| Data Type: |
dei:centralIndexKeyItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionIndicate if registrant meets the emerging growth company criteria. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 12
-Subsection b-2
| Name: |
dei_EntityEmergingGrowthCompany |
| Namespace Prefix: |
dei_ |
| Data Type: |
xbrli:booleanItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionCommission file number. The field allows up to 17 characters. The prefix may contain 1-3 digits, the sequence number may contain 1-8 digits, the optional suffix may contain 1-4 characters, and the fields are separated with a hyphen.
| Name: |
dei_EntityFileNumber |
| Namespace Prefix: |
dei_ |
| Data Type: |
dei:fileNumberItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionTwo-character EDGAR code representing the state or country of incorporation.
| Name: |
dei_EntityIncorporationStateCountryCode |
| Namespace Prefix: |
dei_ |
| Data Type: |
dei:edgarStateCountryItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionThe exact name of the entity filing the report as specified in its charter, which is required by forms filed with the SEC. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 12
-Subsection b-2
| Name: |
dei_EntityRegistrantName |
| Namespace Prefix: |
dei_ |
| Data Type: |
xbrli:normalizedStringItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionThe Tax Identification Number (TIN), also known as an Employer Identification Number (EIN), is a unique 9-digit value assigned by the IRS. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 12
-Subsection b-2
| Name: |
dei_EntityTaxIdentificationNumber |
| Namespace Prefix: |
dei_ |
| Data Type: |
dei:employerIdItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionLocal phone number for entity.
| Name: |
dei_LocalPhoneNumber |
| Namespace Prefix: |
dei_ |
| Data Type: |
xbrli:normalizedStringItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionBoolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 13e
-Subsection 4c
| Name: |
dei_PreCommencementIssuerTenderOffer |
| Namespace Prefix: |
dei_ |
| Data Type: |
xbrli:booleanItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionBoolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 14d
-Subsection 2b
| Name: |
dei_PreCommencementTenderOffer |
| Namespace Prefix: |
dei_ |
| Data Type: |
xbrli:booleanItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionTitle of a 12(g) registered security. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 12
-Subsection g
| Name: |
dei_Security12gTitle |
| Namespace Prefix: |
dei_ |
| Data Type: |
dei:securityTitleItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionName of the Exchange on which a security is registered. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 12
-Subsection d1-1
| Name: |
dei_SecurityExchangeName |
| Namespace Prefix: |
dei_ |
| Data Type: |
dei:edgarExchangeCodeItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionBoolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as soliciting material pursuant to Rule 14a-12 under the Exchange Act. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Section 14a
-Number 240
-Subsection 12
| Name: |
dei_SolicitingMaterial |
| Namespace Prefix: |
dei_ |
| Data Type: |
xbrli:booleanItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionTrading symbol of an instrument as listed on an exchange.
| Name: |
dei_TradingSymbol |
| Namespace Prefix: |
dei_ |
| Data Type: |
dei:tradingSymbolItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionBoolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as written communications pursuant to Rule 425 under the Securities Act. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Securities Act
-Number 230
-Section 425
| Name: |
dei_WrittenCommunications |
| Namespace Prefix: |
dei_ |
| Data Type: |
xbrli:booleanItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
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