FALSE000117897000011789702024-10-292024-10-29

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): October 29, 2024
PROVIDENT FINANCIAL SERVICES, INC.
(Exact Name of Registrant as Specified in its Charter)
Delaware
001-31566
42-1547151
(State or Other Jurisdiction of Incorporation)
(Commission File No.)
(I.R.S. Employer Identification No.)
239 Washington Street, Jersey City, New Jersey
07302
(Address of Principal Executive Offices)
(Zip Code)
Registrant's telephone number, including area code 732-590-9200

Not Applicable
(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 Instruction 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
Symbol(s)
Name of each exchange on which registered
Common
PFS
New York Stock Exchange
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. ☐



Item 2.02    Results of Operation and Financial Condition.

On October 29, 2024, Provident Financial Services, Inc. (the “Company”) issued a press release reporting its financial results for the three and nine months ended September 30, 2024. A copy of the press release is attached as Exhibit 99.1 to this report and is being furnished to the SEC and shall not be deemed “filed” for any purpose.


Item 7.01    Regulation FD Disclosure.

On October 29, 2024, the Company announced that its Board of Directors declared a quarterly cash dividend of $0.24 per common share, payable on November 29, 2024, to stockholders of record as of the close of business on November 15, 2024.

This announcement was included as part of the press release announcing financial results for the three and nine months ended September 30, 2024 and attached as Exhibit 99.1 to this report. A copy of the press release is being furnished to the SEC and shall not be deemed “filed” for any purpose.


Item 9.01.    Financial Statements and Exhibits

(a)     Financial Statements of Businesses Acquired. Not applicable.

(b)    Pro Forma Financial Information. Not applicable.

(c)     Shell Company Transactions. Not applicable.

(d)    Exhibits.

Exhibit No.        Description

99.1    Press release issued by the Company on October 29, 2024 announcing its financial results for the three months ended September 30, 2024 and the declaration of a quarterly cash dividend

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, hereunto duly authorized.



PROVIDENT FINANCIAL SERVICES, INC.
DATE:
October 30, 2024By:/s/ Anthony J. Labozzetta
Anthony J. Labozzetta
President and Chief Executive Officer










Provident Financial Services, Inc. Reports Third Quarter Earnings
and Declares Quarterly Cash Dividend

ISELIN, NJ, October 29, 2024 - Provident Financial Services, Inc. (NYSE:PFS) (the “Company”) reported net income of $46.4 million, or $0.36 per basic and diluted share for the three months ended September 30, 2024, compared to a net loss of $11.5 million, or $0.11 per basic and diluted share, for the three months ended June 30, 2024 and net income of $28.5 million, or $0.38 per basic and diluted share, for the three months ended September 30, 2023. For the nine months ended September 30, 2024, net income totaled $67.0 million, or $0.65 per basic and diluted share, compared to $101.1 million, or $1.35 per basic and diluted share, for the nine months ended September 30, 2023.
The Company’s earnings for the three and nine months ended September 30, 2024 reflected the impact of the May 16, 2024 merger with Lakeland Bancorp, Inc. (“Lakeland”), which added $10.91 billion to total assets, $7.91 billion to loans, and $8.62 billion to deposits, net of purchase accounting adjustments. The merger with Lakeland significantly impacted provisions for credit losses in the trailing quarter due to the initial CECL provisions recorded on acquired loans. The results of operations for the three and nine months ended September 30, 2024 also included other transaction costs related to the merger with Lakeland, totaling $15.6 million and $36.7 million, respectively, compared with transaction costs totaling $2.3 million and $5.3 million for the respective 2023 periods. Additionally, the Company realized a $2.8 million loss related to the sale of subordinated debt issued by Lakeland from the Provident investment portfolio, during the nine months ended September 30, 2024.
Anthony J. Labozzetta, President and Chief Executive Officer commented, “We achieved solid performance this quarter, and we are optimistic that our results will continue to improve as we further realize the synergies of the merger. Provident generated strong earnings and core metrics, aided by robust performance in our fee-based businesses. We continue to expand our operations prudently and believe we are well-positioned for even greater success as market conditions improve.”
Regarding the Company's merger with Lakeland, Mr. Labozzetta added, “We are proud to announce that, with the conversion of our core system in early September, our merger is complete and we are a unified organization. Our cultures are combining well and we are already experiencing the benefits of cost savings and enhanced revenue opportunities. We are grateful to the many team members whose hard work allowed for a smooth conversion and the retention of almost all legacy Lakeland customers.”
Performance Highlights for the Third Quarter of 2024
•Net interest income increased $42.2 million to $183.7 million for the three months ended September 30, 2024, from $141.5 million for the trailing quarter primarily due to the full quarter impact of net assets acquired from Lakeland, including the accretion of purchase accounting adjustments and four basis points of core margin expansion.
•The net interest margin increased ten basis points to 3.31% for the quarter ended September 30, 2024, from 3.21% for the trailing quarter. The weighted average yield on interest-earning assets for the quarter ended September 30, 2024 increased 17 basis points to 5.84%, compared to the trailing quarter, while the weighted average cost of interest-bearing liabilities for the quarter ended September 30, 2024 increased ten basis points to 3.19%, compared to the trailing quarter. The increases in the yields and costs on interest-earning assets and interest-bearing liabilities were primarily due to a full quarter of accretion of purchase accounting adjustments related to the Lakeland merger, which contributed approximately 53 basis points to the net interest margin in the current quarter.
•Non-interest income increased $4.6 million to $26.9 million for the three months ended September 30, 2024, from $22.3 million for the trailing quarter, while non-interest expense increased $20.6 million to $136.0 million for the three months ended September 30, 2024, compared to $115.4 million for the trailing quarter. The increases in both non-interest income and non-interest expense were reflective of a full quarter of combined operations with Lakeland.
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•Wealth management and insurance agency income increased 9.0% and 12.6%, respectively, versus the same period in 2023. The increase in wealth management income was primarily due to an increase in the average market value of assets under management during the period, while the increase in insurance agency income was largely due to an increase in business activity.
•Adjusting for transaction costs related to the merger with Lakeland, net of tax, the Company's annualized adjusted returns on average assets, average equity and average tangible equity(1) were 0.95%, 8.62% and 14.53% for the quarter ended September 30, 2024, compared to 0.06%, 0.53% and 2.01% for the quarter ended June 30, 2024. A reconciliation between GAAP and the above non-GAAP ratios are shown on page 13 of the earnings release.
•The Company's annualized adjusted pre-tax, pre-provision returns on average assets, average equity and average tangible equity(2) were 1.48%, 13.48% and 19.77% for the quarter ended September 30, 2024, compared to 1.47%, 13.26% and 19.21% for the quarter ended June 30, 2024. A reconciliation between GAAP and the above non-GAAP ratios are shown on page 14 of the earnings release.
•As of September 30, 2024, the Company's loan pipeline, consisting of work-in-process and loans approved pending closing, totaled $1.98 billion, with a weighted average interest rate of 7.18%, compared to $1.67 billion, with a weighted average interest rate of 7.53%, as of June 30, 2024.
•The Company recorded a $9.6 million provision for credit losses on loans for the quarter ended September 30, 2024, compared to a $66.1 million provision for the trailing quarter. The provision for credit losses on loans in the quarter was primarily attributable to specific reserves required on individually analyzed loans, combined with some economic forecast deterioration. The allowance for credit losses as a percentage of loans increased to 1.02% as of September 30, 2024, from 1.00% as of June 30, 2024.
•As of September 30, 2024, CRE loans related to office properties totaled $921.1 million, compared to $953.5 million as of June 30, 2024. CRE loans secured by office properties constitutes only 4.9% of total loans and have an average loan size of $1.9 million, with just seven relationships greater than $10.0 million. There were four loans totaling $9.2 million on non-accrual as of September 30, 2024, however we do not expect to incur losses on any of these loans.
•As of September 30, 2024, multi-family CRE loans secured by New York City properties totaled $226.6 million, compared to $227.7 million as of June 30, 2024. This portfolio constitutes only 1.2% of total loans and has an average loan size of $2.6 million. Loans that are collateralized by rent stabilized apartments comprise less than 0.80% of the total loan portfolio and are all performing.
•Non-performing loans to total loans as of September 30, 2024 increased to 0.47%, compared to 0.36% as of June 30, 2024, while non-performing assets to total assets as of September 30, 2024 increased to 0.41%, compared to 0.33% as of June 30, 2024. The increase in non-performing loans, compared to the prior quarter was primarily attributable to one commercial real estate credit secured by an industrial property which has a loan-to-value ratio of approximately 39%. We anticipate a near-term resolution of this credit with no expected loss. For the three months ended September 30, 2024, net charge-offs totaled $6.8 million, or an annualized 14 basis points of average loans. Of this total, $6.4 million was attributable to one previously identified commercial relationship that had a $4.4 million specific reserve as of June 30, 2024. This credit is expected to be fully resolved in the fourth quarter of 2024.
Declaration of Quarterly Dividend
The Company’s Board of Directors declared a quarterly cash dividend of $0.24 per common share payable on November 29, 2024 to stockholders of record as of the close of business on November 15, 2024.
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Results of Operations
Three months ended September 30, 2024 compared to the three months ended June 30, 2024
For the three months ended September 30, 2024, the Company reported net income of $46.4 million, or $0.36 per basic and diluted share, compared to a net loss of $11.5 million, or $0.11 per basic and diluted share, for the three months ended June 30, 2024. The Company’s earnings for the prior quarter were impacted by an initial CECL provision for credit losses on loans and commitments to extend credit of $65.2 million recorded as part of the Lakeland merger in accordance with GAAP requirements for accounting for business combinations. The results of operations for the three months ended September 30, 2024 included transaction costs related to the merger with Lakeland totaling $15.6 million, compared with transaction costs totaling $18.9 million in the trailing quarter. Additionally, the Company realized a $2.8 million loss in the trailing quarter related to the sale from the Provident investment portfolio of subordinated debt issued by Lakeland.
Net Interest Income and Net Interest Margin
Net interest income increased $42.2 million to $183.7 million for the three months ended September 30, 2024, from $141.5 million for the trailing quarter. Net interest income for the three months ended September 30, 2024 was favorably impacted by a full quarter of combined operations with Lakeland and accretion of purchase accounting adjustments, compared to a 45 days impact in the prior quarter.

The Company’s net interest margin increased ten basis points to 3.31% for the quarter ended September 30, 2024, from 3.21% for the trailing quarter. Accretion of purchase accounting adjustments related to the Lakeland merger contributed 53 basis points to the net interest margin in the current quarter. The current net interest margin reflects a full quarter of the acquisition of Lakeland’s interest-bearing assets and liabilities, the prior quarter sale of $554.2 million of securities acquired from Lakeland and the repayment of overnight borrowings as well as the prior quarter issuance of subordinated debt.
The weighted average yield on interest-earning assets for the quarter ended September 30, 2024 increased 17 basis points to 5.84%, compared to the trailing quarter. The weighted average cost of interest-bearing liabilities for the quarter ended September 30, 2024 increased ten basis points from the trailing quarter, to 3.19%. The average cost of interest-bearing deposits for the quarter ended September 30, 2024 increased 12 basis points to 2.96%, compared to 2.84% for the trailing quarter. The average cost of total deposits, including non-interest-bearing deposits, was 2.36% for the quarter ended September 30, 2024, compared to 2.27% for the trailing quarter. The average cost of borrowed funds for the quarter ended September 30, 2024 was 3.73%, compared to 3.83% for the quarter ended June 30, 2024. All yields and costs reflect a full quarter of combined operations with Lakeland.
Provision for Credit Losses on Loans
For the quarter ended September 30, 2024, the Company recorded a $9.6 million provision for credit losses on loans, compared with a provision for credit losses on loans of $66.1 million for the quarter ended June 30, 2024. The provision for credit losses on loans in the quarter was primarily attributable to specific reserves required on individually analyzed loans, combined with some economic forecast deterioration, while the provision for credit losses on loans in the prior quarter was primarily attributable to an initial CECL provision for credit losses of $60.1 million, recorded as part of the Lakeland merger in accordance with GAAP requirements for accounting for business combinations. For the three months ended September 30, 2024, net charge-offs totaled $6.8 million, or an annualized 14 basis points of average loans.
Non-Interest Income and Expense
For the three months ended September 30, 2024, non-interest income totaled $26.9 million, an increase of $4.6 million, compared to the trailing quarter. Net gain on securities transactions increased $3.0 million for the three months ended September 30, 2024, compared to the trailing quarter, primarily due to a $2.8 million loss realized on the sale from the Provident investment portfolio of subordinated debt issued by Lakeland in the prior quarter. Fee income increased $1.1 million to $9.8 million for the three months ended September 30, 2024, compared to the trailing quarter, primarily due to increases in deposit and debit card related fee income. The increases in fee income are primarily attributable to the addition of the Lakeland customer base. BOLI income increased $1.0 million for the three months ended September 30, 2024, compared to the trailing quarter, primarily due to an increase in benefit
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claims recognized. Partially offsetting these increases in non-interest income, insurance agency income decreased $857,000 to $3.6 million for the three months ended September 30, 2024, compared to the trailing quarter, due to a seasonal decrease in business activity in the current quarter, while wealth management income decreased $149,000 to $7.6 million for the three months ended September 30, 2024, compared to the trailing quarter, mainly due to a seasonal decrease in tax preparation fees, partially offset by an increase in the average market value of assets under management during the period.
Non-interest expense totaled $136.0 million for the three months ended September 30, 2024, an increase of $20.6 million, compared to $115.4 million for the trailing quarter. Compensation and benefits expense increased $8.6 million to $63.5 million for the three months ended September 30, 2024, compared to $54.9 million for the trailing quarter. The increase in compensation and benefits expense was primarily attributable to a full quarter of combined operations with Lakeland, compared to 45 days in the prior quarter. Amortization of intangibles increased $5.7 million to $12.2 million for the three months ended September 30, 2024, compared to $6.5 million for the trailing quarter, largely due to a full quarter of core deposit intangible amortization related to Lakeland. Other operating expenses increased $4.5 million to $15.8 million for the three months ended September 30, 2024, compared to $11.3 million for the trailing quarter, primarily due to increases in professional service expenses. Data processing expense increased $2.0 million to $10.5 million for the three months ended September 30, 2024, compared to $8.4 million for the trailing quarter, primarily due a full quarter of combined operations with Lakeland, while net occupancy expense increased $1.6 million to $12.8 million for the three months ended September 30, 2024, compared to $11.1 million for the trailing quarter, primarily due to increases in maintenance and depreciation expenses from the addition of Lakeland. Additionally, FDIC insurance increased $1.1 million to $4.2 million for the three months ended September 30, 2024, primarily resulting from the impact of the Lakeland merger. Partially offsetting these increases, merger-related expenses decreased $3.3 million to $15.6 million for the three months ended September 30, 2024, compared to the trailing quarter.
The Company’s annualized adjusted non-interest expense as a percentage of average assets(5) declined to 1.98% for the quarter ended September 30, 2024, compared to 2.02% for the trailing quarter. The efficiency ratio (adjusted non-interest expense divided by the sum of net interest income and non-interest income)(6) improved to 57.20% for the three months ended September 30, 2024, compared to 57.86% for the trailing quarter.
Income Tax Expense/Benefit
For the three months ended September 30, 2024, the Company's income tax expense was $18.9 million, compared to an income tax benefit of $9.8 million for the trailing quarter. The increase in tax expense for the three months ended September 30, 2024 compared with the trailing quarter was largely due to an increase in taxable income in the current quarter as a result of the Lakeland merger and a $5.3 million tax benefit realized in the trailing quarter related to the revaluation of deferred tax assets to reflect the imposition by the State of New Jersey of a 2.5% Corporate Transit Fee, effective January 1, 2024.
Three months ended September 30, 2024 compared to the three months ended September 30, 2023
For the three months ended September 30, 2024, the Company reported net income of $46.4 million, or $0.36 per basic and diluted share, compared to net income of $28.5 million, or $0.38 per basic and diluted share, for the three months ended September 30, 2023. The Company’s earnings for the quarter ended September 30, 2024 reflected the impact of the May 16, 2024 merger with Lakeland. The results of operations included transaction costs related to the merger with Lakeland totaling $15.6 million and $2.3 million for the three months ended September 30, 2024 and 2023, respectively.
Net Interest Income and Net Interest Margin
Net interest income increased $87.5 million to $183.7 million for the three months ended September 30, 2024, from $96.2 million for same period in 2023. Net interest income for the three months ended September 30, 2024 was favorably impacted by the net assets acquired from Lakeland, combined with favorable repricing of adjustable rate loans, higher market rates on new loan originations and the originations of higher-yielding loans, partially offset by unfavorable repricing of both deposits and borrowings.
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The Company’s net interest margin increased 35 basis points to 3.31% for the quarter ended September 30, 2024, from 2.96% for the same period last year. Accretion of purchase accounting adjustments related to the Lakeland merger contributed 53 basis points to the net interest margin in the current quarter. The current quarter net interest margin reflects the acquisition of Lakeland’s interest bearing assets and liabilities, the prior quarter sale of $554.2 million of securities acquired from Lakeland and the repayment of overnight borrowings as well as the prior quarter issuance of subordinated debt.
The weighted average yield on interest-earning assets for the quarter ended September 30, 2024 increased 95 basis points to 5.84%, compared to 4.89% for the quarter ended September 30, 2023. The weighted average cost of interest-bearing liabilities increased 69 basis points for the quarter ended September 30, 2024 to 3.19%, compared to 2.50% for the third quarter of 2023. The average cost of interest-bearing deposits for the quarter ended September 30, 2024 was 2.96%, compared to 2.22% for the same period last year. Average non-interest-bearing demand deposits increased $1.51 billion to $3.74 billion for the quarter ended September 30, 2024, compared to $2.23 billion for the quarter ended September 30, 2023. The average cost of total deposits, including non-interest-bearing deposits, was 2.36% for the quarter ended September 30, 2024, compared with 1.74% for the quarter ended September 30, 2023. The average cost of borrowed funds for the quarter ended September 30, 2024 was 3.73%, compared to 3.74% for the same period last year.
Provision for Credit Losses on Loans
For the quarter ended September 30, 2024, the Company recorded a $9.6 million provision for credit losses on loans, compared with an $11.0 million provision for credit losses on loans for the quarter ended September 30, 2023. The provision for credit losses on loans in the current quarter was primarily attributable to specific reserves required on individually analyzed loans, combined with some economic forecast deterioration. For the three months ended September 30, 2024, net charge-offs totaled $6.8 million, or an annualized 14 basis points of average loans.
Non-Interest Income and Expense
Non-interest income totaled $26.9 million for the quarter ended September 30, 2024, an increase of $7.5 million, compared to the same period in 2023. Fee income increased $3.7 million to $9.8 million for the three months ended September 30, 2024, compared to the prior year quarter, primarily due to increases in deposit fee income, debit card related fee income and loan related fee income, resulting from the Lakeland merger. BOLI income increased $2.5 million to $4.3 million for the three months ended September 30, 2024, compared to the prior year quarter, primarily due to an increase in benefit claims recognized, combined with an increase in income related to the addition of Lakeland's BOLI. Wealth management fees increased $628,000 to $7.6 million for the three months ended September 30, 2024, compared to the quarter ended September 30, 2023, mainly due to an increase in the average market value of assets under management during the period, while insurance agency income increased $407,000 to $3.6 million for the three months ended September 30, 2024, compared to the quarter ended September 30, 2023, largely due to an increase in business activity. Additionally, other income increased $339,000 to $1.5 million for the three months ended September 30, 2024, compared to the quarter ended September 30, 2023, primarily due to increases in gains on the sale of SBA and mortgage loans.
For the three months ended September 30, 2024, non-interest expense totaled $136.0 million, an increase of $70.4 million, compared to the three months ended September 30, 2023. Compensation and benefits expense increased $27.8 million to $63.5 million for the three months ended September 30, 2024, compared to $35.7 million for the same period in 2023. The increase in compensation and benefits expense was primarily attributable to the addition of Lakeland. Additionally, merger-related expenses increased $13.3 million to $15.6 million for the three months ended September 30, 2024, compared to the same period in 2023. Amortization of intangibles increased $11.5 million to $12.2 million for the three months ended September 30, 2024, compared to $720,000 for the same period in 2023, largely due to core deposit intangible amortization related to Lakeland in the current quarter. Data processing expenses increased $5.2 million to $10.5 million for three months ended September 30, 2024, compared to $5.3 million for the same period in 2023, primarily due to additional software and hardware expenses needed for the addition of Lakeland. Net occupancy expense increased $4.7 million to $12.8 million for three months ended September 30, 2024, compared to $8.1 million for the same period in 2023, primarily due to an increase in depreciation and maintenance expenses due to the addition of Lakeland. Other operating expenses increased $5.0 million to $15.8 million for the three months ended September 30, 2024, compared to $10.7 million for the same
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period in 2023, primarily due to increases in professional service expenses, while FDIC insurance increased $2.6 million to $4.2 million for the three months ended September 30, 2024, primarily due to the addition of Lakeland.
The Company’s annualized adjusted non-interest expense as a percentage of average assets(5) was 1.98% for the quarter ended September 30, 2024, compared to 1.80% for the same period in 2023. The efficiency ratio (adjusted non-interest expense divided by the sum of net interest income and non-interest income)(6) was 57.20% for the three months ended September 30, 2024 compared to 54.81% for the same respective period in 2023.
Income Tax Expense
For the three months ended September 30, 2024, the Company's income tax expense was $18.9 million with an effective tax rate of 28.9%, compared with an income tax expense of $8.8 million with an effective tax rate of 23.7% for the three months ended September 30, 2023. The increase in tax expense for the three months ended September 30, 2024, compared with the same period last year was largely due to an increase in taxable income in the quarter, as a result of the Lakeland merger and the imposition by the State of New Jersey of a 2.5% Corporate Transit Fee in the prior quarter.
Nine months ended September 30, 2024 compared to the nine months ended September 30, 2023
For the nine months ended September 30, 2024, net income totaled $67.0 million, or $0.65 per basic and diluted share, compared to net income of $101.1 million, or $1.35 per basic and diluted share, for the nine months ended September 30, 2023. The Company’s earnings for the nine months ended September 30, 2024 were impacted by an initial CECL provision for credit losses on loans and commitments to extend credit of $60.1 million recorded as part of the Lakeland merger in accordance with GAAP requirements for accounting for business combinations. Transaction costs related to our merger with Lakeland totaled $36.7 million and $5.3 million for the nine months ended September 30, 2024 and 2023, respectively. Additionally, the Company realized a $2.8 million loss related to the sale from the Provident investment portfolio of subordinated debt issued by Lakeland, during the nine months ended September 30, 2024.
Net Interest Income and Net Interest Margin
Net interest income increased $115.2 million to $418.9 million for the nine months ended September 30, 2024, from $303.7 million for same period in 2023. Net interest income for the nine months ended September 30, 2024 was favorably impacted by the net assets acquired from Lakeland, combined with the favorable repricing of adjustable rate loans, higher market rates on new loan originations and the originations of higher-yielding loans, partially offset by the unfavorable repricing of both deposits and borrowings.
For the nine months ended September 30, 2024, our net interest margin decreased one basis point to 3.18%, compared to 3.19% for the nine months ended September 30, 2023. The weighted average yield on interest earning assets increased 85 basis points to 5.61% for the nine months ended September 30, 2024, compared to 4.76% for the nine months ended September 30, 2023, while the weighted average cost of interest-bearing liabilities increased 99 basis points to 3.06% for the nine months ended September 30, 2024, compared to 2.07% for the same period last year. The average cost of interest-bearing deposits increased 102 basis points to 2.84% for the nine months ended September 30, 2024, compared to 1.82% for the same period last year. Average non-interest-bearing demand deposits increased $514.3 million to $2.90 billion for the nine months ended September 30, 2024, compared with $2.38 billion for the nine months ended September 30, 2023. The average cost of total deposits, including non-interest-bearing deposits, was 2.27% for the nine months ended September 30, 2024, compared with 1.40% for the nine months ended September 30, 2023. The average cost of borrowings for the nine months ended September 30, 2024 was 3.73%, compared to 3.29% for the same period last year.
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Provision for Credit Losses on Loans
For the nine months ended September 30, 2024, the Company recorded a $75.9 million provision for credit losses on loans, compared with a provision for credit losses on loans of $27.4 million for the nine months ended September 30, 2023. The increased provision for credit losses on loans for the nine months ended September 30, 2024 was primarily attributable to an initial CECL provision for credit losses on loans of $60.1 million recorded as part of the Lakeland merger in accordance with GAAP requirements for accounting for business combinations, partially offset by an improved economic forecast for the current nine-month period within our CECL model, compared to the same period last year. For the nine months ended September 30, 2024, net charge-offs totaled $9.1 million or an annualized eight basis points of average loans.
Non-Interest Income and Expense
For the nine months ended September 30, 2024, non-interest income totaled $69.9 million, an increase of $9.1 million compared to the same period in 2023. Fee income increased $6.1 million to $24.4 million for the nine months ended September 30, 2024, compared to the same period in 2023, primarily due to increases in deposit fee income, debit and credit card related fee income and loan related fee income resulting from the Lakeland merger. BOLI income increased $4.6 million to $9.4 million for the nine months ended September 30, 2024, compared to the same period in 2023, primarily due to an increase in benefit claims recognized, combined with an increase in income related to the addition of Lakeland's BOLI, while wealth management income increased $2.1 million to $22.9 million for the nine months ended September 30, 2024, compared to the same period in 2023, mainly due to an increase in the average market value of assets under management during the period. Additionally, insurance agency income increased $1.7 million to $12.9 million for the nine months ended September 30, 2024, compared to $11.2 million for the same period in 2023, largely due to increases in contingent commissions, retention revenue and new business activity. Partially offsetting these increases in non-interest income, net gains on securities transactions decreased $3.0 million for the nine months ended September 30, 2024, primarily due to a $2.8 million loss related to the sale from the Provident investment portfolio of subordinated debt issued by Lakeland. Other income decreased $2.4 million to $3.2 million for the nine months ended September 30, 2024, compared to $5.7 million for the same period in 2023, primarily due to a $2.0 million gain from the sale of a foreclosed commercial property recorded in the prior year, combined with a decrease in gains on sales of SBA loans.
Non-interest expense totaled $323.2 million for the nine months ended September 30, 2024, an increase of $123.7 million, compared to $199.5 million for the nine months ended September 30, 2023. Compensation and benefits expense increased $48.7 million to $158.4 million for the nine months ended September 30, 2024, compared to $109.7 million for the nine months ended September 30, 2023. The increase in compensation and benefits expense was primarily attributable to the addition of Lakeland. Merger-related expenses increased $31.3 million to $36.7 million for the nine months ended September 30, 2024, compared to $5.3 million for the nine months ended September 30, 2023. Amortization of intangibles increased $17.2 million to $19.4 million for the nine months ended September 30, 2024, compared to $2.2 million for the nine months ended September 30, 2023, largely due to core deposit intangible amortization related to Lakeland. Data processing expense increased $9.2 million to $25.7 million for the nine months ended September 30, 2024, compared to $16.5 million for the nine months ended September 30, 2023, primarily due to additional software and hardware expenses needed for the addition of Lakeland, while net occupancy expense increased $8.0 million to $32.5 million for the nine months ended September 30, 2024, compared to the same period in 2023, primarily due to increases in depreciation and maintenance expense related to the addition of Lakeland. Other operating expenses increased $5.6 million to $37.4 million for the three months ended September 30, 2024, compared to $31.8 million for the same period in 2023, primarily due to increases in professional service expenses, while FDIC insurance increased $3.9 million to $9.6 million for the three months ended September 30, 2024, primarily due to the addition of Lakeland.
Income Tax Expense
For the nine months ended September 30, 2024, the Company's income tax expense was $19.9 million with an effective tax rate of 22.9%, compared with $34.9 million with an effective tax rate of 25.7% for the nine months ended September 30, 2023. The decrease in tax expense for the nine months ended September 30, 2024 compared with the same period last year was largely due to a $5.8 million tax benefit related to the revaluation of deferred tax assets to reflect the imposition by the State of New Jersey of a 2.5% Corporate Transit Fee, effective January 1, 2024, combined with a decrease in taxable income as a result of the initial CECL provision for credit losses on loans of
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$60.1 million recorded in accordance with GAAP requirements for accounting for business combinations and additional expenses from the Lakeland merger.
Asset Quality
The Company’s total non-performing loans as of September 30, 2024 were $89.9 million, or 0.47% of total loans, compared to $67.9 million, or 0.36% of total loans as of June 30, 2024 and $49.6 million, or 0.46% of total loans as of December 31, 2023. The $22.1 million increase in non-performing loans as of September 30, 2024, compared to the trailing quarter, consisted of a $10.4 million increase in non-performing commercial mortgage loans, an $8.9 million increase in non-performing commercial loans, a $1.5 million increase in non-performing construction loans, a $764,000 increase in non-performing residential mortgage loans, a $302,000 increase in non-performing multi-family loans and a $289,000 increase in non-performing consumer loans. As of September 30, 2024, impaired loans totaled $74.0 million with related specific reserves of $7.2 million, compared with impaired loans totaling $54.6 million with related specific reserves of $7.7 million as of June 30, 2024. As of December 31, 2023, impaired loans totaled $42.8 million with related specific reserves of $2.4 million.
As of September 30, 2024, the Company’s allowance for credit losses related to the loan portfolio was 1.02% of total loans, compared to 1.00% and 0.99% as of June 30, 2024 and December 31, 2023, respectively. The allowance for credit losses increased $84.0 million to $191.2 million as of September 30, 2024, from $107.2 million as of December 31, 2023. The increase in the allowance for credit losses on loans as of September 30, 2024 compared to December 31, 2023 was due to a $75.9 million provision for credit losses, which included an initial CECL provision of $60.1 million on loans acquired from Lakeland, and a $17.2 million allowance recorded through goodwill related to Purchased Credit Deteriorated loans acquired from Lakeland, partially offset by net charge-offs of $9.1 million.
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The following table sets forth accruing past due loans and non-accrual loans on the dates indicated, as well as delinquency statistics and certain asset quality ratios.
 September 30, 2024June 30, 2024December 31, 2023
 
Number
of
Loans
Principal
Balance
of Loans
Number
of
Loans
Principal
Balance
of Loans
Number
of
Loans
Principal
Balance
of Loans
(Dollars in thousands)
Accruing past due loans:
30 to 59 days past due:
Commercial mortgage loans2 $430 3 $1,707 1 $825 
Multi-family mortgage loans— — — — 1 3,815 
Construction loans— — — — — — 
Residential mortgage loans23 5,020 9 1,714 13 3,429 
Total mortgage loans25 5,450 12 3,421 15 8,069 
Commercial loans14 1,952 20 3,444 6 998 
Consumer loans53 4,073 38 2,891 31 875 
Total 30 to 59 days past due92 $11,475 70 $9,756 52 $9,942 
60 to 89 days past due:
Commercial mortgage loans1 $641 3 $1,231 — $— 
Multi-family mortgage loans— — — — 1 1,635 
Construction loans— — — — — — 
Residential mortgage loans11 1,991 10 2,193 8 1,208 
Total mortgage loans12 2,632 13 3,424 9 2,843 
Commercial loans9 1,240 6 1,146 3 198 
Consumer loans10 606 9 648 5 275 
Total 60 to 89 days past due31 4,478 28 5,218 17 3,316 
Total accruing past due loans123 $15,953 98 $14,974 69 $13,258 
Non-accrual:
Commercial mortgage loans17 $13,969 10 $3,588 7 $5,151 
Multi-family mortgage loans6 7,578 5 7,276 1 744 
Construction loans2 13,151 1 11,698 1 771 
Residential mortgage loans24 5,211 20 4,447 7 853 
Total mortgage loans49 39,909 36 27,009 16 7,519 
Commercial loans69 48,592 58 39,715 26 41,487 
Consumer loans32 1,433 24 1,144 10 633 
Total non-accrual loans150 $89,934 118 $67,868 52 $49,639 
Non-performing loans to total loans0.47 %0.36 %0.46 %
Allowance for loan losses to total non-performing loans217.09 %277.50 %215.96 %
Allowance for loan losses to total loans1.02 %1.00 %0.99 %
As of September 30, 2024 and December 31, 2023, the Company held foreclosed assets of $9.8 million and $11.7 million, respectively. During the nine months ended September 30, 2024, there were three properties sold with an aggregate carrying value of $532,000 and one write-down of a foreclosed commercial property of $1.3 million. Foreclosed assets as of September 30, 2024 consisted primarily of commercial real estate. Total non-performing assets as of September 30, 2024 increased $36.6 million to $97.9 million, or 0.41% of total assets, from $61.3 million, or 0.43% of total assets as of December 31, 2023.
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Balance Sheet Summary
Total assets as of September 30, 2024 were $24.04 billion, a $9.83 billion increase from December 31, 2023. The increase in total assets was primarily due to the addition of Lakeland.
The Company’s loans held for investment portfolio totaled $18.79 billion as of September 30, 2024 and $10.87 billion as of December 31, 2023. The loan portfolio consisted of the following:
September 30, 2024June 30, 2024December 31, 2023
(Dollars in thousands)
Mortgage loans:
Commercial$7,342,456 $7,337,742 $4,512,411 
Multi-family3,226,918 3,189,808 1,812,500 
Construction873,509 970,244 653,246 
Residential2,032,671 2,024,027 1,164,956 
Total mortgage loans13,475,554 13,521,821 8,143,113 
Commercial loans4,710,601 4,617,232 2,440,621 
Consumer loans623,709 626,016 299,164 
Total gross loans18,809,864 18,765,069 10,882,898 
Premiums on purchased loans1,362 1,410 1,474 
Net deferred fees and unearned discounts(16,617)(7,149)(12,456)
Total loans$18,794,609 $18,759,330 $10,871,916 
As part of the merger with Lakeland, we acquired $7.91 billion in loans, net of purchase accounting adjustments. Compared to the prior quarter, during the three months ended September 30, 2024, the loan portfolio had net increases of $93.4 million of commercial loans, $37.1 million of multi-family loans, $8.6 million of residential mortgage loans, and $4.7 million of commercial mortgage loans, partially offset by net decreases of $96.7 million of construction loans and $2.3 million of consumer loans. Commercial loans, consisting of commercial real estate, multi-family, commercial and construction loans, represented 85.9% of the loan portfolio as of September 30, 2024, compared to 86.5% as of December 31, 2023.
For the nine months ended September 30, 2024, loan funding, including advances on lines of credit, totaled $2.78 billion, compared with $2.53 billion for the same period in 2023.
As of September 30, 2024, the Company’s unfunded loan commitments totaled $2.97 billion, including commitments of $1.84 billion in commercial loans, $231.0 million in construction loans and $225.7 million in commercial mortgage loans. Unfunded loan commitments as of December 31, 2023 and September 30, 2023 were $2.09 billion and $2.18 billion, respectively.
The loan pipeline, consisting of work-in-process and loans approved pending closing, totaled $1.98 billion as of September 30, 2024, compared to $1.09 billion and $1.70 billion as of December 31, 2023 and September 30, 2023, respectively.
Total investment securities were $3.17 billion as of September 30, 2024, a $1.04 billion increase from December 31, 2023. This increase was primarily due to the addition of Lakeland.
Total deposits increased $8.08 billion during the nine months ended September 30, 2024, to $18.38 billion, due primarily to the addition of Lakeland. Total savings and demand deposit accounts increased $6.02 billion to $15.22 billion as of September 30, 2024, while total time deposits increased $2.06 billion to $3.16 billion as of September 30, 2024. The increase in savings and demand deposits was largely attributable to a $2.92 billion increase in interest bearing demand deposits, a $1.58 billion increase in non-interest bearing demand deposits, a $1.03 billion increase in money market deposits and a $495.5 million increase in savings deposits. The increase in time deposits consisted of a $2.01 billion increase in retail time deposits and a $46.5 million increase in brokered time deposits.
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Borrowed funds increased $244.5 million during the nine months ended September 30, 2024, to $2.21 billion. The increase in deposits and borrowings was largely due to the addition of Lakeland. Borrowed funds represented 9.2% of total assets as of September 30, 2024, a decrease from 13.9% as of December 31, 2023.
Stockholders’ equity increased $930.5 million during the nine months ended September 30, 2024, to $2.62 billion, primarily due to common stock issued for the purchase of Lakeland, net income earned for the period and an improvement in unrealized losses on available for sale debt securities, partially offset by cash dividends paid to stockholders. For the three and nine months ended September 30, 2024, common stock repurchases totaled 1,969 shares at an average cost of $16.36 per share and 88,821 shares at an average cost of $14.87 per share, respectively, all of which were made in connection with withholding to cover income taxes on the vesting of stock-based compensation. As of September 30, 2024, approximately 1.0 million shares remained eligible for repurchase under the current stock repurchase authorization. Book value per share and tangible book value per share(1) as of September 30, 2024 were $20.09 and $13.66, respectively, compared with $22.38 and $16.32, respectively, as of December 31, 2023.
About the Company
Provident Financial Services, Inc. is the holding company for Provident Bank, a community-oriented bank offering "commitment you can count on" since 1839. Provident Bank provides a comprehensive array of financial products and services through its network of branches throughout New Jersey, Bucks, Lehigh and Northampton counties in Pennsylvania, as well as Orange, Queens and Nassau Counties in New York. Provident Bank also provides fiduciary and wealth management services through its wholly owned subsidiary, Beacon Trust Company and insurance services through its wholly owned subsidiary, Provident Protection Plus, Inc.
Post Earnings Conference Call
Representatives of the Company will hold a conference call for investors on Wednesday, October 30, 2024 at 10:00 a.m. Eastern Time to discuss the Company’s financial results for the quarter ended September 30, 2024. The call may be accessed by dialing 1-888-412-4131 (United States Toll Free) and 1-646-960-0134 (United States Local). Speakers will need to enter conference ID code (3610756) before being met by a live operator. Internet access to the call is also available (listen only) at provident.bank by going to Investor Relations and clicking on "Webcast."
Forward Looking Statements
Certain statements contained herein are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements may be identified by reference to a future period or periods, or by the use of forward-looking terminology, such as “may,” “will,” “believe,” “expect,” “estimate,” "project," "intend," “anticipate,” “continue,” or similar terms or variations on those terms, or the negative of those terms. Forward-looking statements are subject to numerous risks and uncertainties, including, but not limited to, those set forth in Item 1A of the Company's Annual Report on Form 10-K, as supplemented by its Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, and those related to the economic environment, particularly in the market areas in which the Company operates, inflation and unemployment, competitive products and pricing, real estate values, fiscal and monetary policies of the U.S. Government, the effects of any turmoil or negative news in the banking industry, changes in accounting policies and practices that may be adopted by the regulatory agencies and the accounting standards setters, changes in government regulations affecting financial institutions, including regulatory fees and capital requirements, changes in prevailing interest rates, potential goodwill impairment, acquisitions and the integration of acquired businesses, credit risk management, asset-liability management, the financial and securities markets, the availability of and costs associated with sources of liquidity, any failure to realize the anticipated benefits of the merger transaction when expected or at all; the possibility that the transaction may be more expensive to complete than anticipated, including as a result of unexpected conditions, factors or events, potential adverse reactions or changes to business, employee, customer and/or counterparty relationships, including those resulting from the completion of the merger and integration of the companies; and the impact of a potential shutdown of the federal government.
The Company cautions readers not to place undue reliance on any such forward-looking statements which speak only as of the date they are made. The Company advises readers that the factors listed above could affect the Company's financial performance and could cause the Company's actual results for future periods to differ materially from any
11

opinions or statements expressed with respect to future periods in any current statements. The Company does not assume any duty, and does not undertake, to update any forward-looking statements to reflect events or circumstances after the date of this statement.
Footnotes
(1) Annualized adjusted return on average assets, average equity and average tangible equity, annualized adjusted pre-tax pre-provision return on average assets, average equity and average tangible equity, tangible book value per share, annualized adjusted non-interest expense as a percentage of average assets and the efficiency ratio are non-GAAP financial measures. Please refer to the Notes following the Consolidated Financial Highlights which contain the reconciliation of GAAP to non-GAAP financial measures and the associated calculations.












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PROVIDENT FINANCIAL SERVICES, INC. AND SUBSIDIARY
Consolidated Financial Highlights
(Dollars in Thousands, except share data) (Unaudited)
At or for the
Three Months Ended 		At or for the
Nine Months Ended
September 30,June 30,September 30,September 30,September 30,
20242024202320242023
Statement of Income
Net interest income$183,701 $141,506 $96,236 $418,877 $303,666 
Provision for credit losses9,299 69,705 12,541 78,684 29,031 
Non-interest income26,855 22,275 19,320 69,937 60,861 
Non-interest expense136,002 115,394 65,625 323,224 199,485 
Income (loss) before income tax expense65,255 (21,318)37,390 86,906 136,011 
Net income (loss)46,405 (11,485)28,547 67,001 101,086 
Diluted earnings per share$0.36 $(0.11)$0.38 $0.65 $1.35 
Interest rate spread2.65 %2.58 %2.39 %2.55 %2.69 %
Net interest margin3.31 %3.21 %2.96 %3.18 %3.19 %
Profitability
Annualized return on average assets0.76 %(0.24)%0.81 %0.47 %0.98 %
Annualized adjusted return on average assets (1)
0.95 %0.06 %0.86 %0.66 %1.02 %
Annualized return on average equity6.94 %(2.17)%6.84 %4.14 %8.22 %
Annualized adjusted return on average equity (1)
8.62 %0.53 %7.30 %5.83 %8.59 %
Annualized return on average tangible equity (4)
12.06 %(3.15)%9.47 %7.13 %11.40 %
Annualized adjusted return on average tangible equity (1)
14.53 %2.01 %10.24 %9.56 %12.07 %
Annualized adjusted non-interest expense to average assets (4)
1.98 %2.02 %1.80 %1.99 %1.87 %
Efficiency ratio (6)
57.20 %57.86 %54.81 %58.27 %53.26 %
Asset Quality
Non-accrual loans$67,868 $89,934 $39,529 
90+ and still accruing— — — 
Non-performing loans67,868 88,061 39,529 
Foreclosed assets11,119 9,801 16,487 
Non-performing assets78,987 97,862 56,016 
Non-performing loans to total loans0.36 %0.47 %0.37 %
Non-performing assets to total assets0.33 %0.41 %0.40 %
Allowance for loan losses$188,331 $191,175 $107,563 
Allowance for loan losses to total non-performing loans277.50 %217.09 %272.11 %
Allowance for loan losses to total loans1.00 %1.02 %1.01 %
Net loan charge-offs$6,756 $1,340 $5,510 $9,067 $7,266 
Annualized net loan charge-offs to average total loans 0.14 %0.04 %0.21 %0.08 %0.09 %
Average Balance Sheet Data
Assets$24,248,038 $19,197,041 $13,976,610 $19,198,113 $13,848,351 
Loans, net18,531,939 14,649,413 10,470,843 14,631,071 10,269,022 
Earning assets21,809,226 17,385,819 12,735,938 17,305,446 12,574,437 
Core deposits15,394,715 12,257,244 9,212,202 12,271,839 9,408,156 
Borrowings2,125,149 2,158,193 1,780,655 2,074,958 1,556,619 
Interest-bearing liabilities17,304,569 13,856,039 9,826,064 13,757,895 9,554,204 
Stockholders' equity2,660,470 2,127,469 1,654,920 2,163,856 1,645,093 
Average yield on interest-earning assets5.84 %5.67 %4.89 %5.61 %4.76 %
Average cost of interest-bearing liabilities3.19 %3.09 %2.50 %3.06 %2.07 %


13




Notes and Reconciliation of GAAP and Non-GAAP Financial Measures
(Dollars in Thousands, except share data)
The Company has presented the following non-GAAP (U.S. Generally Accepted Accounting Principles) financial measures because it believes that these measures provide useful and comparative information to assess trends in the Company’s results of operations and financial condition. Presentation of these non-GAAP financial measures is consistent with how the Company evaluates its performance internally and these non-GAAP financial measures are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in the Company’s industry. Investors should recognize that the Company’s presentation of these non-GAAP financial measures might not be comparable to similarly-titled measures of other companies. These non-GAAP financial measures should not be considered a substitute for GAAP basis measures and the Company strongly encourages a review of its condensed consolidated financial statements in their entirety.
(1) Annualized Adjusted Return on Average Assets, Equity and Tangible Equity
Three Months EndedNine Months Ended
September 30,June 30,September 30,September 30,September 30,
20242024202320242023
Net Income$46,405 $(11,485)$28,547 $67,001 $101,086 
Merger-related transaction costs15,567 18,915 2,289 36,684 5,349 
Less: income tax expense(4,306)(4,625)(486)(9,274)(1,015)
Annualized adjusted net income$57,666 $2,805 $30,350 $94,411 $105,420 
Less: Amortization of Intangibles (net of tax)$8,551 $4,532 $503 $13,577 $1,560 
Annualized adjusted net income for annualized adjusted return on average tangible equity$66,217 $7,337 $30,853 $107,988 $106,980 
Annualized Adjusted Return on Average Assets0.95 %0.06 %0.86 %0.66 %1.02 %
Annualized Adjusted Return on Average Equity8.62 %0.53 %7.30 %5.83 %8.59 %
Annualized Adjusted Return on Average Tangible Equity14.53 %2.01 %10.24 %9.56 %12.07 %
(2) Annualized adjusted pre-tax, pre-provision ("PTPP") returns on average assets, average equity and average tangible equity
Three Months EndedNine Months Ended
September 30,June 30,September 30,September 30,September 30,
20242024202320242023
Net income (loss)$46,405 $(11,485)$28,547 $67,001 $101,086 
Adjustments to net income (loss):
Provision for credit losses9,299 69,705 12,541 78,684 29,031 
Net loss on Lakeland bond sale— 2,839 — — — 
Merger-related transaction costs15,567 18,915 2,289 36,684 5,349 
Income tax expense (benefit)18,850 (9,833)8,843 19,905 34,925 
PTPP income$90,121 $70,141 $52,220 $202,274 $170,391 
Annualized PTPP income$358,525 $282,106 $207,177 $270,191 $227,812 
Average assets$24,248,038 $19,197,041 $13,976,610 $19,198,113 $13,848,351 
Average equity$2,660,470 $2,127,469 $1,654,920 $2,163,856 $1,645,093 
Average tangible equity$1,813,327 $1,468,630 $1,195,787 $1,508,594 $1,185,222 
Annualized PTPP return on average assets1.48 %1.47 %1.48 %1.41 %1.65 %
Annualized PTPP return on average equity13.48 %13.26 %12.52 %12.49 %13.85 %
Annualized PTPP return on average tangible equity19.77 %19.21 %17.33 %17.91 %19.22 %
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(3) Book and Tangible Book Value per Share
September 30,June 30,December 31,
202420242023
Total stockholders' equity$2,621,058 $2,555,646 $1,690,596 
Less: total intangible assets839,223 851,507 457,942 
Total tangible stockholders' equity$1,781,835 $1,704,139 $1,232,654 
Shares outstanding130,448,599 130,380,393 75,537,186 
Book value per share (total stockholders' equity/shares outstanding)$20.09 $19.60 $22.38 
Tangible book value per share (total tangible stockholders' equity/shares outstanding)$13.66 $13.07 $16.32 
(4) Annualized Return on Average Tangible Equity
Three Months EndedNine Months Ended
September 30,June 30,September 30,September 30,September 30,
20242024202320242023
Total average stockholders' equity$2,660,470 $2,127,469 $1,654,920 $2,163,856 $1,645,093 
Less: total average intangible assets847,143 658,839 459,133 655,262 459,871 
Total average tangible stockholders' equity$1,813,327 $1,468,630 $1,195,787 $1,508,594 $1,185,222 
Net income (loss)$46,405 $(11,485)$28,547 $67,001 $101,086 
Less: Amortization of Intangibles, net of tax8,551 4,532 503 13,577 1,560 
Total net income (loss)$54,956 $(6,953)$29,050 $80,578 $102,646 
Annualized return on average tangible equity (net income/total average tangible stockholders' equity)12.06 %(1.90)%9.64 %7.13 %11.58 %
(5) Annualized Adjusted Non-Interest Expense to Average Assets
Three Months EndedNine Months Ended
September 30,June 30,September 30,September 30,September 30,
20242024202320242023
Reported non-interest expense$136,002 $115,394 $65,625 $323,224 $199,485 
Adjustments to non-interest expense:
Merger-related transaction costs15,567 18,915 2,289 36,684 5,349 
Adjusted non-interest expense$120,435 $96,479 $63,336 $286,540 $194,136 
Annualized adjusted non-interest expense$479,122 $388,036 $251,279 $382,751 $259,559 
Average assets$24,248,038 $19,197,041 $13,976,610 $19,198,113 $13,848,351 
Annualized adjusted non-interest expense/average assets1.98 %2.02 %1.80 %1.99 %1.87 %
(6) Efficiency Ratio Calculation
Three Months EndedNine Months Ended
September 30,June 30,September 30,September 30,September 30,
20242024202320242023
Net interest income$183,701 $141,506 $96,236 $418,877 $303,666 
Reported non-interest income26,855 22,275 19,320 69,937 60,861 
Adjustments to non-interest income:
Net (gain) loss on securities transactions(2)2,973 13 2,972 (37)
Adjusted non-interest income26,853 25,248 19,333 72,909 60,824 
Total income$210,554 $166,754 $115,569 $491,786 $364,490 
Adjusted non-interest expense $120,435 $96,479 $63,336 $286,540 $194,136 
Efficiency ratio (adjusted non-interest expense/income)57.20 %57.86 %54.80 %58.27 %53.26 %

15


16

PROVIDENT FINANCIAL SERVICES, INC. AND SUBSIDIARY
Consolidated Statements of Financial Condition
September 30, 2024 (Unaudited) and December 31, 2023
(Dollars in Thousands)
AssetsSeptember 30, 2024December 31, 2023
Cash and due from banks$244,064 $180,241 
Short-term investments25 14 
Total cash and cash equivalents244,089 180,255 
Available for sale debt securities, at fair value2,725,110 1,690,112 
Held to maturity debt securities, net of allowance (fair value of $322,427 as of September 30, 2024 (unaudited) and $352,601 as of December 31, 2023) 332,021 363,080 
Equity securities, at fair value20,044 1,270 
Federal Home Loan Bank stock96,219 79,217 
Loans held for sale5,757 1,785 
Loans held for investment18,794,609 10,871,916 
Less allowance for credit losses191,175 107,200 
Net loans18,609,191 10,766,501 
Foreclosed assets, net9,801 11,651 
Banking premises and equipment, net124,955 70,998 
Accrued interest receivable89,866 58,966 
Intangible assets839,223 457,942 
Bank-owned life insurance403,648 243,050 
Other assets548,348 287,768 
Total assets$24,042,515 $14,210,810 
Liabilities and Stockholders' Equity
Deposits:
Demand deposits$13,548,480 $8,020,889 
Savings deposits1,671,209 1,175,683 
Certificates of deposit of $250,000 or more800,005 218,549 
Other time deposits2,356,491 877,393 
Total deposits18,376,185 10,292,514 
Mortgage escrow deposits48,007 36,838 
Borrowed funds2,214,512 1,970,033 
Subordinated debentures414,184 10,695 
Other liabilities368,569 210,134 
Total liabilities21,421,457 12,520,214 
Stockholders' equity:
Preferred stock, $0.01 par value, 50,000,000 shares authorized, none issued— — 
Common stock, $0.01 par value, 200,000,000 shares authorized, 137,565,966 shares issued and 130,448,599 shares outstanding as of September 30, 2024 and 75,537,186 outstanding as of December 31, 2023.1,376 832 
Additional paid-in capital1,871,343 989,058 
Retained earnings972,997 974,542 
Accumulated other comprehensive loss (93,049)(141,115)
Treasury stock(129,148)(127,825)
Unallocated common stock held by the Employee Stock Ownership Plan(2,461)(4,896)
Common Stock acquired by the Directors' Deferred Fee Plan(2,247)(2,694)
Deferred Compensation - Directors' Deferred Fee Plan2,247 2,694 
Total stockholders' equity2,621,058 1,690,596 
Total liabilities and stockholders' equity$24,042,515 $14,210,810 
17

PROVIDENT FINANCIAL SERVICES, INC. AND SUBSIDIARY
Consolidated Statements of Income
Three months ended September 30, 2024, June 30, 2024 and September 30, 2023, and nine months ended September 30, 2024 and 2023 (Unaudited)
(Dollars in Thousands, except per share data)
Three Months EndedNine Months Ended
September 30,June 30,September 30,September 30,September 30,
20242024202320242023
Interest and dividend income:
Real estate secured loans$197,857 $156,318 $104,540 $461,632 $299,830 
Commercial loans81,183 58,532 33,806 175,815 93,915 
Consumer loans12,947 8,351 4,746 25,820 13,419 
Available for sale debt securities, equity securities and Federal Home Loan Bank stock25,974 20,394 11,886 58,698 34,748 
Held to maturity debt securities2,136 2,357 2,334 6,761 7,059 
Deposits, federal funds sold and other short-term investments2,425 1,859 885 5,466 2,678 
Total interest income322,522 247,811 158,197 734,192 451,649 
Interest expense:
Deposits110,009 81,058 44,923 243,602 108,880 
Borrowed funds19,923 20,566 16,765 57,871 38,329 
Subordinated debt8,889 4,681 273 13,842 774 
Total interest expense138,821 106,305 61,961 315,315 147,983 
Net interest income183,701 141,506 96,236 418,877 303,666 
Provision charge for credit losses9,299 69,705 12,541 78,684 29,031 
Net interest income after provision for credit losses174,402 71,801 83,695 340,193 274,635 
Non-interest income:
Fees9,816 8,699 6,132 24,426 18,294 
Wealth management income7,620 7,769 6,992 22,878 20,826 
Insurance agency income3,631 4,488 3,224 12,912 11,175 
Bank-owned life insurance4,308 3,323 1,820 9,448 4,838 
Net gain (loss) on securities transactions2 (2,973)13 (2,972)37 
Other income1,478 969 1,139 3,245 5,691 
Total non-interest income26,855 22,275 19,320 69,937 60,861 
Non-interest expense:
Compensation and employee benefits63,468 54,888 35,702 158,404 109,724 
Net occupancy expense12,790 11,142 8,113 32,452 24,474 
Data processing expense10,481 8,433 5,312 25,698 16,536 
FDIC Insurance4,180 3,100 1,628 9,553 5,688 
Amortization of intangibles12,231 6,483 720 19,420 2,231 
Advertising and promotion expense1,524 1,171 1,133 3,661 3,722 
Merger-related expenses15,567 18,915 2,289 36,684 5,349 
Other operating expenses15,761 11,262 10,728 37,352 31,761 
Total non-interest expense136,002 115,394 65,625 323,224 199,485 
Income (loss) before income tax expense65,255 (21,318)37,390 86,906 136,011 
Income tax expense (benefit)18,850 (9,833)8,843 19,905 34,925 
Net income (loss)$46,405 $(11,485)$28,547 $67,001 $101,086 
Basic earnings per share$0.36 $(0.11)$0.38 $0.65 $1.35 
Average basic shares outstanding129,941,845102,957,52174,909,083102,819,04274,793,530
Diluted earnings per share$0.36 $(0.11)$0.38 $0.65 $1.35 
Average diluted shares outstanding130,004,870102,957,52174,914,205102,845,26174,816,606
18

PROVIDENT FINANCIAL SERVICES, INC. AND SUBSIDIARY
Net Interest Margin Analysis
Quarterly Average Balances
 (Dollars in Thousands) (Unaudited)
September 30, 2024June 30, 2024September 30, 2023
Average BalanceInterestAverage
Yield/Cost		Average BalanceInterestAverage
Yield/Cost		Average BalanceInterestAverage
Yield/Cost
Interest-Earning Assets:
Deposits$179,313 $2,425 5.38 %$40,228 $1,859 5.38 %$74,183 $884 4.73 %
Federal funds sold and other short-term investments— — — %0— — %571 4.00 %
Available for sale debt securities2,644,26224,8843.72 %2,244,72517,647 3.14 %1,724,83310,1272.35 %
Held to maturity debt securities, net (1)
342,2172,1362.50 %352,2162,357 2.68 %373,6812,3342.50 %
Equity securities, at fair value19,654 — — %10,373 — — %1,068 — — %
Federal Home Loan Bank stock91,8411,0904.75 %88,8642,74712.36 %91,2731,7597.71 %
Net loans: (2)
Total mortgage loans13,363,265197,8575.83 %10,674,109156,3185.81 %7,881,193104,5405.21 %
Total commercial loans4,546,08881,1837.05 %3,514,60258,5326.62 %2,289,26733,8065.81 %
Total consumer loans622,58612,9478.27 %460,7028,3517.29 %300,3834,7466.27 %
Total net loans18,531,939291,9876.21 %14,649,413223,2016.05 %10,470,843143,0925.37 %
Total interest-earning assets$21,809,226 $322,522 5.84 %$17,385,819 $247,811 5.67 %$12,735,938 $158,197 4.89 %
Non-Interest Earning Assets:
Cash and due from banks341,50537,62182,522
Other assets2,097,307 1,773,601 1,158,150
Total assets$24,248,038 $19,197,041 $13,976,610 
Interest-Bearing Liabilities:
Demand deposits$9,942,053 $74,864 3.00 %$7,935,543 $58,179 2.95 %$5,741,052 $35,290 2.44 %
Savings deposits1,711,5021,0060.23 %1,454,7848320.23 %1,240,9515920.19 %
Time deposits3,112,59834,1394.36 %2,086,43322,0474.25 %1,052,7939,0413.41 %
Total deposits14,766,153110,0092.96 %11,476,76081,0582.84 %8,034,79644,9232.22 %
Borrowed funds2,125,14919,9233.73 %2,158,19320,5663.83 %1,780,65516,7653.74 %
Subordinated debentures413,267 8,889 8.56 %221,086 4,681 8.52 %10,613 273 10.24 %
Total interest-bearing liabilities17,304,569138,8213.19 %13,856,039106,3053.09 %9,826,06461,9612.50 %
Non-Interest Bearing Liabilities:
Non-interest bearing deposits3,741,1602,866,9172,230,199
Other non-interest bearing liabilities541,839346,616265,427
Total non-interest bearing liabilities4,282,9993,213,5332,495,626
Total liabilities21,587,56817,069,57212,321,690
Stockholders' equity2,660,4702,127,4691,654,920
Total liabilities and stockholders' equity$24,248,038 $19,197,041 $13,976,610 
Net interest income$183,701 $141,506 $96,236 
Net interest rate spread2.65 %2.58 %2.39 %
Net interest-earning assets$4,504,657 $3,529,780 $2,909,874 
Net interest margin (3)
3.31 %3.21 %2.96 %
Ratio of interest-earning assets to total interest-bearing liabilities1.26x1.25x1.30x
(1)Average outstanding balance amounts shown are amortized cost, net of allowance for credit losses.
(2)Average outstanding balances are net of the allowance for loan losses, deferred loan fees and expenses, loan premiums and discounts and include non-accrual loans.
(3)Annualized net interest income divided by average interest-earning assets.
19

The following table summarizes the quarterly net interest margin for the previous five quarters.
9/30/246/30/243/31/2412/31/239/30/23
3rd Qtr.2nd Qtr.1st Qtr.4th Qtr.3rd Qtr.
Interest-Earning Assets:
Securities3.69 %3.40 %2.87 %2.79 %2.67 %
Net loans6.21 %6.05 %5.51 %5.50 %5.37 %
Total interest-earning assets5.84 %5.67 %5.06 %5.04 %4.89 %
Interest-Bearing Liabilities:
Total deposits2.96 %2.84 %2.60 %2.47 %2.22 %
Total borrowings3.73 %3.83 %3.60 %3.71 %3.74 %
Total interest-bearing liabilities3.19 %3.09 %2.80 %2.71 %2.50 %
Interest rate spread2.65 %2.58 %2.26 %2.33 %2.39 %
Net interest margin3.31 %3.21 %2.87 %2.92 %2.96 %
Ratio of interest-earning assets to interest-bearing liabilities1.26x1.25x1.28x1.28x1.30x


















20

PROVIDENT FINANCIAL SERVICES, INC. AND SUBSIDIARY
Net Interest Margin Analysis
Average Year to Date Balances
(Dollars in Thousands) (Unaudited)
September 30, 2024September 30, 2023
AverageAverageAverageAverage
BalanceInterestYield/CostBalanceInterestYield/Cost
Interest-Earning Assets:
Deposits$39,280 $5,466 5.38 %$69,696 $2,676 5.13 %
Federal funds sold and other short term investments— — — %58 2 5.34 %
Available for sale debt securities2,189,671 52,553 3.19 %1,777,861 30,819 2.31 %
Held to maturity debt securities, net (1)
350,529 6,761 2.57 %379,144 7,059 2.48 %
Equity securities, at fair value10,050 — — %1,022 — — %
Federal Home Loan Bank stock84,845 6,145 9.66 %77,634 3,929 6.75 %
Net loans: (2)
Total mortgage loans10,682,974 461,632 5.70 %7,740,591 299,830 5.12 %
Total commercial loans3,487,600 175,815 6.69 %2,225,725 93,915 5.60 %
Total consumer loans460,497 25,820 7.49 %302,706 13,419 5.93 %
Total net loans14,631,071 663,267 5.99 %10,269,022 407,164 5.25 %
Total interest-earning assets$17,305,446 $734,192 5.61 %$12,574,437 $451,649 4.76 %
Non-Interest Earning Assets:
Cash and due from banks229,336 121,801 
Other assets1,663,331 1,152,113 
Total assets$19,198,113 $13,848,351 
Interest-Bearing Liabilities:
Demand deposits$7,931,251 $174,609 2.94 %$5,710,855 $85,822 2.01 %
Savings deposits1,444,135 2,476 0.23 %1,315,157 1,582 0.16 %
Time deposits2,091,806 66,517 4.25 %961,010 21,476 2.99 %
Total deposits11,467,192 243,602 2.84 %7,987,022 108,880 1.82 %
Borrowed funds2,074,958 57,871 3.73 %1,556,619 38,329 3.29 %
Subordinated debentures215,745 13,842 8.57 %10,563 774 9.80 %
Total interest-bearing liabilities$13,757,895 $315,315 3.06 %$9,554,204 $147,983 2.07 %
Non-Interest Bearing Liabilities:
Non-interest bearing deposits2,896,453 2,382,144 
Other non-interest bearing liabilities379,909 266,910 
Total non-interest bearing liabilities3,276,362 2,649,054 
Total liabilities17,034,257 12,203,258 
Stockholders' equity2,163,856 1,645,093 
Total liabilities and stockholders' equity$19,198,113 $13,848,351 
Net interest income$418,877 $303,666 
Net interest rate spread2.55 %2.69 %
Net interest-earning assets$3,547,551 $3,020,233 
Net interest margin (3)
3.18 %3.19 %
Ratio of interest-earning assets to total interest-bearing liabilities1.26x1.32x
(1) Average outstanding balance amounts shown are amortized cost, net of allowance for credit losses.
(2) Average outstanding balance are net of the allowance for loan losses, deferred loan fees and expenses, loan premium and discounts and include non-accrual loans.
(3) Annualized net interest income divided by average interest-earning assets.
21

The following table summarizes the year-to-date net interest margin for the previous three years.
Nine Months Ended
September 30, 2024September 30, 2023September 23, 2022
Interest-Earning Assets:
Securities3.33 %2.57 %1.72 %
Net loans5.99 %5.25 %4.01 %
Total interest-earning assets5.61 %4.76 %3.51 %
Interest-Bearing Liabilities:
Total deposits2.84 %1.82 %0.33 %
Total borrowings3.73 %3.29 %0.97 %
Total interest-bearing liabilities3.06 %2.07 %0.38 %
Interest rate spread2.55 %2.69 %3.13 %
Net interest margin3.18 %3.19 %3.24 %
Ratio of interest-earning assets to interest-bearing liabilities1.26x1.32x1.38x




22
v3.24.3
Cover Page
Oct. 29, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Oct. 29, 2024
Entity Registrant Name PROVIDENT FINANCIAL SERVICES, INC.
Entity Incorporation, State or Country Code DE
Entity File Number 001-31566
Entity Tax Identification Number 42-1547151
Entity Address, Address Line One 239 Washington Street
Entity Address, City or Town Jersey City
Entity Address, State or Province NJ
Entity Address, Postal Zip Code 07302
City Area Code 732
Local Phone Number 590-9200
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common
Trading Symbol PFS
Security Exchange Name NYSE
Entity Emerging Growth Company false
Amendment Flag false
Entity Central Index Key 0001178970
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