0000923139-21-000015.txt : 20210428 0000923139-21-000015.hdr.sgml : 20210428 20210427174004 ACCESSION NUMBER: 0000923139-21-000015 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 14 CONFORMED PERIOD OF REPORT: 20210427 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20210428 DATE AS OF CHANGE: 20210427 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FLUSHING FINANCIAL CORP CENTRAL INDEX KEY: 0000923139 STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022] IRS NUMBER: 113209278 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-33013 FILM NUMBER: 21860393 BUSINESS ADDRESS: STREET 1: 220 RXR PLAZA CITY: UNIONDALE STATE: NY ZIP: 11556 BUSINESS PHONE: 718-961-5400 MAIL ADDRESS: STREET 1: 220 RXR PLAZA CITY: UNIONDALE STATE: NY ZIP: 11556 8-K 1 ffic-20210427x8k.htm 8-K
0000923139false00009231392021-04-272021-04-27

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):  April 27, 2021

FLUSHING FINANCIAL CORPORATION

(Exact name of registrant as specified in its charter)

001-33013

(Commission File Number)

Delaware

(State or Other Jurisdiction of Incorporation)

11-3209278

(I.R.S. Employer Identification No.)

220 RXR PlazaUniondaleNY 11556

(Address of principal executive offices)

(718961-5400

(Registrant's telephone number, including area code)

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:

    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

FFIC

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. ☐

Item 2.02. Results of Operations and Financial Condition.

On April 27, 2021, the Registrant issued a press release, a copy of which is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

Item 9.01. Financial Statements and Exhibits.

Exhibit 99.1. Press release dated April 27, 2021

104 Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURE

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.

usa

FLUSHING FINANCIAL CORPORATION

    

Date: April 27, 2021

By: 

/s/ SUSAN K. CULLEN

Susan K. Cullen

Senior Executive Vice President and Chief Financial Officer

EX-99.1 2 ffic-20210427ex9919856fb.htm EX-99.1

Exhibit 99.1

Graphic

John R. Buran, President and CEO Commentary

Fourth Consecutive Quarter of Record Net Interest Income

1Q21 GAAP EPS of $0.60, Core EPS of $0.54; Reported NIM Up 10 bps, Core NIM Rises 3 bps QoQ

UNIONDALE, N.Y., April 27, 2021 (GLOBE NEWSWIRE) - “We are optimistic that as more people receive vaccines, local economic activity will improve. Our first quarter 2021 actions largely focused on helping our customers navigate an improving, but still challenging environment. Despite these challenges, we achieved our fourth consecutive quarter of record net interest income. We reduced loans in forbearance by 81% from their peak nearly a year ago, and while our forbearance programs will continue into 2022, borrowers’ fundamentals are improving. The recent steepening of the yield curve is a positive for us and we expect to capitalize on our robust loan pipeline. We continue to make investments in our technology platform and fintech partnerships, both of which are driving digital engagement.”

“First quarter of 2021 marked a continuation of the economic improvement in our local economies and the outlook is brighter than three months ago with continued vaccine rollouts and a steeper yield curve. We continue to assist customers during the pandemic by originating $123 million of PPP loans in the quarter and processing nearly $50 million in forgiveness over the life of the program.”

- John R. Buran, President and CEO

Record Net Interest Income; NIM Expansion. “Core NIM improved by 3 bps during the quarter as funding costs declined faster than asset yields. The steeper yield curve should mitigate pressure on asset yields while keeping funding costs low. However, we are preparing for an eventual rise in short term rates by extending the duration of our liabilities and utilizing forward swaps, the bulk of which begin in 2022. We focused our efforts on PPP this quarter and that impacted overall loan growth, which rose 2.4% (annualized) from fourth quarter 2020. We reported first quarter GAAP EPS of $0.60, which included improving fair value adjustments, partially offset by merger and other charges totaling $0.06 per share, net of tax. Adjusting for noncore items1, first quarter core EPS was $0.54, up 184% year over year. The Empire integration is complete with 100% of the cost savings in our run rate. We are on track to achieve our 20% earnings accretion target for 2021.”

Strong Credit Quality. “We remain confident with our credit quality given the loan to value of 38% on our real estate dependent loans, improving delinquencies, lower criticized and classified assets, and our conservative underwriting standards.”

1Q21 Key Financial Metrics1

1Q21

4Q20

3Q20

2Q20

1Q20

GAAP:

EPS

$0.60

$0.11

$0.50

$0.63

($0.05)

ROAA (%)

0.93

0.18

0.81

1.01

(0.08)

ROAE (%)

12.29

2.27

9.94

13.11

(0.96)

NIM FTE (%)

3.18

3.08

3.00

2.87

2.44

Core:

EPS

$0.54

$0.58

$0.56

$0.36

$0.19

ROAA (%)

0.83

0.92

0.91

0.57

0.31

ROAE (%)

10.96

11.67

11.22

7.39

3.82

Core NIM FTE (%)

3.06

3.03

2.98

2.89

2.56

Efficiency Ratio (%)

58.6

57.6

55.4

54.9

68.2

Credit Quality:

NPAs/Loans&REO (%)

0.31

0.31

0.42

0.34

0.29

LLRs/Loans (%)

0.67

0.67

0.65

0.61

0.47

LLRs/NPLs (%)

212.87

214.27

154.66

181.84

167.73

NCOs/Avg Loans (%)

0.17

0.04

0.06

0.07

0.08

Balance Sheet:

Avg Loans ($B)

$6.7

$6.4

$5.9

$5.9

$5.8

Avg Dep ($B)

$6.3

$5.5

$5.0

$5.0

$5.1

Book Value/Share

$20.65

$20.11

$20.78

$20.27

$19.48

Tangible BV/Share

$19.99

$19.45

$20.22

$19.71

$18.92

TCE/TA (%)

7.60

7.52

8.10

7.78

7.38

1 See “Reconciliation of GAAP Earnings and Core Earnings” and “Reconciliation of GAAP Net Interest Margin to Core and Base Net Interest Income and Net Interest Margin.”

Investor Contact: Susan K. Cullen, SEVP, Treasurer and CFO, 718-961-54001


Graphic

1Q21 Highlights

Record net interest income up 9.3% QoQ and 49.2% YoY to $60.9 million, while core net interest income was up 7.0% QoQ and 36.5% YoY to $58.5 million due to Empire transaction and lower funding costs
Net interest margin rose 10 bps QoQ and 74 bps YoY to 3.18%, and core net interest margin up 3 bps QoQ and 50 bps YoY to 3.06% primarily due to lower funding costs
Average loans up 5.1% QoQ and 15.6% YoY to $6.7 billion, including $123.2 million of PPP originations
Average deposits rose 14.0% QoQ and 23.4% YoY to $6.3 billion, with core deposits 83% of total average deposits (including escrow deposits)
Loan pipeline rose 15.9% YoY to $375.8 million
Provision for credit losses of $2.8 million and net charge-offs of $2.9 million in 1Q21 largely the result of the $2.8 million charge-off for the remaining taxi medallion loans
NPAs were flat QoQ at $21.2 million; criticized and classified assets fell 11.9% to $63.1 million
Loans in forbearance were 4.4% of total loans and only 1.7% of loans excluding loans making interest only payments

Income Statement Highlights

Y/Y

Q/Q

($000s, except EPS)

1Q21

4Q20

3Q20

2Q20

1Q20

Change

Change

Net Interest Income

$60,892

$55,732

$49,924

$48,717

$40,826

49.2

%

9.3

%

Provision for Credit Losses

2,820

3,862

2,470

9,619

7,178

(60.7)

(27.0)

Non-interest Income (Loss)

6,311

(1,181)

1,351

13,737

(2,864)

NM

NM

Non-interest Expense

38,159

46,811

29,985

28,755

32,380

17.8

(18.5)

Income (Loss) Before Income Taxes

26,224

3,878

18,820

24,080

(1,596)

NM

NM

Provision (Benefit) for Income Taxes

7,185

417

4,489

5,808

(206)

NM

NM

Net Income (Loss)

$19,039

$3,461

$14,331

$18,272

($1,390)

NM

NM

Diluted EPS

$0.60

$0.11

$0.50

$0.63

($0.05)

NM

NM

Avg. Diluted Shares (000s)

31,604

30,603

28,874

28,867

28,853

9.5

3.3

Core Net Income1

$16,973

$17,784

$16,168

$10,297

$5,500

208.6

(4.6)

Core EPS1

$0.54

$0.58

$0.56

$0.36

$0.19

184.2

(6.9)

1 See Reconciliation of GAAP Earnings and Core Earnings

Net interest income for 1Q21 was $60.9 million, an increase of 49.2% YoY and 9.3% QoQ (Empire contributed $6.1 million in 1Q21 and $4.2 million in 4Q20).

Net interest margin of 3.18%, increased 74 bps YoY and 10 bps QoQ; net purchase accounting accretion was $0.9 million in 1Q21 and not meaningful in 4Q20
Prepayment penalty income from loans and securities, net reversals and recoveries of interest from non-accrual loans, net gains (losses) from fair value adjustments on qualifying hedges, and purchase accounting accretion totaled $3.3 million (17 bps) in 1Q21, $2.1 million (11 bps) in 4Q20, $1.7 million (11 bps) in 3Q20, $0.4 million (2 bps) in 2Q20, and $(0.9) million ((5) bps) in 1Q20
Excluding these items, net interest margin was 3.01% in 1Q21, 2.97% in 4Q20, 2.89% in 3Q20, 2.85% in 2Q20, and 2.49% in 1Q20, or an increase of 52 bps YoY and 4 bps QoQ

The Company recorded a provision for credit losses of $2.8 million in 1Q21, compared to $3.9 million in 4Q20, $2.5 million in 3Q20, $9.6 million in 2Q20, and $7.2 million in 1Q20.

1Q21 provision for credit losses was driven by the charge-off of the total remaining taxi medallion portfolio of $2.8 million; excluding the taxi medallion portfolio, net charge-offs were only $0.1 million
Net charge-offs were $2.9 million in 1Q21, $0.6 million in 4Q20, $0.8 million in 3Q20, $1.0 million in 2Q20, and $1.1 million in 1Q20

Investor Contact: Susan K. Cullen, SEVP, Treasurer and CFO, 718-961-54002


Graphic

Non-interest income (loss) for 1Q21 was $6.3 million versus $(1.2) million in 4Q20, $1.4 million in 3Q20, $13.7 million in 2Q20, and $(2.9) million in 1Q20.

Non-interest income (loss) included net gains (losses) from fair value adjustments of $1.0 million ($0.02 per share, net of tax) in 1Q21, $(4.1) million ($(0.11) per share, net of tax) in 4Q20, $(2.2) million ($(0.06) per share, net of tax) in 3Q20, $10.2 million ($0.27 per share, net of tax) in 2Q20, and $(6.0) million ($(0.15) per share, net of tax) in 1Q20
The net gain on the disposition of assets was $0.6 million in 1Q21 ($0.01 per share, net of tax); losses on the sale of investment securities were $0.6 million ($0.02 per share, net of tax) in 4Q20 and less than $0.1 million (less than $0.01 per share, net of tax) in both 2Q20 and 1Q20;
Absent all above items, non-interest income was $4.7 million in 1Q21, up 48.7% YoY and 32.3% QoQ and was primarily driven by strong customer swap activity

Non-interest expense was $38.2 million in 1Q21 compared to $46.8 million in 4Q20, $30.0 million in 3Q20, $28.8 million in 2Q20, and $32.4 million in 1Q20.

1Q21 non-interest expense includes $1.0 million of pre-tax merger charges ($0.02 per share, net of tax) and $0.1 million of core deposit intangible amortization and other purchase accounting adjustments (less than $0.01 per share net of tax)
4Q20 non-interest expense includes $5.3 million pre-tax merger charges ($0.14 per share, net of tax) and $7.8 million pre-tax debt prepayment penalties ($0.20 per share, net of tax)
3Q20, 2Q20, and 1Q20 non-interest expense includes $0.4 million of merger charges ($0.01 per share, net of tax), $0.2 million ($0.01 per share, net of tax), and $0.9 million ($0.02 per share, net of tax), respectively
Excluding the above items, core operating expenses were $37.1 million in 1Q21, up 17.8% YoY and 10.5% QoQ; Empire contributed $1.9 million in 1Q21 and $1.7 million in 4Q20
There were $3.3 million of seasonal compensation expenses in 1Q21 (compared to $3.0 million a year ago) that are not expected to repeat in 2Q21
The ratio of core operating expense to average assets was 1.82% in 1Q21, 1.74% in 4Q20, 1.67% in 3Q20, 1.59% in 2Q20, and 1.77% in 1Q20
The efficiency ratio was 58.6% in 1Q21, 57.6% in 4Q20, 55.4% in 3Q20, 54.9% in 2Q20, and 68.2% in 1Q20

The provision (benefit) for income taxes was $7.2 million in 1Q21 versus $0.4 million in 4Q20, $4.5 million in 3Q20, $5.8 million in 2Q20, and $(0.2) million in 1Q20.

Pre-tax income (loss) was $26.2 million in 1Q21, compared to $3.9 million in 4Q20, $18.8 million in 3Q20, $24.1 million in 2Q20, and $(1.6) million in 1Q20
The effective tax rate was 27.4% in 1Q21, 10.8% in 4Q20, 23.9% in 3Q20, 24.1% in 2Q20, and 12.9% in 1Q20
New York State passed a law increasing the state tax rate to 7.25% from 6.5% on April 19, 2021; with this change, we now expect the effective tax rate to approximate 27% in 2021

Investor Contact: Susan K. Cullen, SEVP, Treasurer and CFO, 718-961-54003


Graphic

Balance Sheet, Credit Quality, and Capital Highlights

Y/Y

Q/Q

($000s, except per share data)

1Q21

4Q20

3Q20

2Q20

1Q20

Change

Change

Loans And Deposits

Period End Loans, net

$6,700

$6,660

$5,903

$5,947

$5,904

13.5

%

0.6

%

Average Deposits

6,285

5,515

4,999

5,043

5,094

23.4

14.0

Credit Quality

Nonperforming Loans

$21,186

$21,073

$24,792

$20,188

$16,752

26.5

%

0.5

%

Nonperforming Assets

21,221

21,108

24,827

20,431

16,995

24.9

0.5

Criticized and Classified Assets

63,130

71,691

42,181

48,712

34,199

84.6

(11.9)

Allowance for Credit Losses/Loans (%)

0.67

0.67

0.65

0.61

0.47

20

bps

-

bps

Capital

Book Value/Share

$20.65

$20.11

$20.78

$20.27

$19.48

6.0

%

2.7

%

Tangible Book Value/Share

19.99

19.45

20.22

19.71

18.92

5.7

2.8

Tang. Common Equity/Tang. Assets (%)

7.60

7.52

8.10

7.78

7.38

22

bps

8

bps

Leverage Ratio (%)

8.44

8.38

9.03

8.64

8.59

(15)

6

Net loans held for investment were $6.7 billion, an increase of 13.5% YoY and 0.6% QoQ.

SBA Paycheck Protection Program (“PPP”) loans were $251.0 million at 1Q21, compared to $151.9 million at 4Q20, $111.6 million at 3Q20, and $93.2 million at 2Q20, as we supported our customers with the second round of PPP originations and forgiveness, with originations totaling $123.2 million in 1Q21
Total loan closings were $322.9 million (including $123.2 million from PPP) in 1Q21 versus $316.0 million in 4Q20, $155.6 million in 3Q20, $233.8 million in 2Q20, and $298.7 million in 1Q20
The loan pipeline was $375.8 million at March 31, 2021, compared to $324.4 million a year ago

Average Deposits totaled $6.3 billion, rising 23.4% YoY and 14.0% QoQ, partially due to customer growth, the Empire transaction, and unused PPP funds.

Core deposits (non-CD deposits) were 82.5% of total average deposits (including escrow deposits) in 1Q21, compared to 75.1% a year ago
With the steepening of the yield curve, we have extended the duration of our funding liabilities to prepare for rising short term rates

Credit Quality; Non-performing loans totaled $21.2 million compared to $21.1 million in 4Q20 and $16.8 million in 1Q20.

Non-performing assets totaled $21.2 million, flat QoQ, but up 24.9% YoY
Criticized and classified assets totaled $63.1 million in 1Q21, compared to $71.7 million in 4Q20, and $34.2 million in 1Q20; the QoQ decline was primarily due to improved borrowers’ fundamentals, while the YoY rise related to the impacts of the pandemic
Loans classified as troubled debt restructured (TDR) totaled $15.2 million, versus $15.7 million in 4Q20, and $6.3 million a year ago
Active COVID-19 forbearances totaled 116 loans with a principal balance of $295.5 million at March 31 2021, with 61% making interest payments; approximately 25% of these loans are scheduled to exit forbearance in 2Q21, 15% in 3Q21, and 43% in 4Q21
Over 85% of gross loans are collateralized by real estate and these loans have a loan-to-value ratio of 38% as of March 31, 2021
Allowance for credit losses were 0.67% of loans in 1Q21 compared to 0.67% in 4Q20 and 0.47% a year ago

Investor Contact: Susan K. Cullen, SEVP, Treasurer and CFO, 718-961-54004


Graphic

Capital; Book value per common share increased to $20.65 in 1Q21, compared to $20.11 in 4Q20 and $19.48 in 1Q20; tangible book value per common share, a non-GAAP measure, improved to $19.99 in 1Q21, versus $19.45 in 4Q20, and $18.92 in 1Q20.

The Company paid a dividend of $0.21 per share in 1Q21 and did not repurchase any shares in the quarter; up to 284,806 shares remained subject to repurchase under the authorized stock repurchase program, which has no expiration or maximum dollar limit
Tangible common equity to tangible assets was 7.60% in 1Q21 compared to 7.38% a year ago
The Company and the Bank remain well capitalized under all applicable regulatory requirements
The leverage ratio was 8.44% in 1Q21 versus 8.59% in 1Q20

Investor Contact: Susan K. Cullen, SEVP, Treasurer and CFO, 718-961-54005


Graphic

Conference Call Information And Future Earnings Release Dates

Conference Call Information:

John R. Buran, President and Chief Executive Officer, and Susan K. Cullen, Senior Executive Vice President and Chief Financial Officer, will host a conference call tomorrow, Wednesday, April 28, 2021 at 9:30 AM (ET) to discuss the Company’s first quarter 2021 results and strategy.
Dial-in for Live Call: 1-877-509-5836
Webcast: https://services.choruscall.com/links/ffic210428.html
Dial-in for Replay: 1-877-344-7529
Replay Access Code: 10151631
The conference call will be simultaneously webcast and archived through April 28, 2022.

Future Earnings Release Dates:

The Company plans to release quarterly financial results on the following dates:

Second Quarter 2021 after the market close on July 27, 2021; conference call at 9:30 AM (ET) on July 28, 2021.

Third Quarter 2021 after the market close on October 26, 2021; conference call at 9:30 AM (ET) on October 27, 2021.

A detailed announcement will be issued prior to each quarter’s close confirming the date and time of the earnings release and conference call for that quarter.

About Flushing Financial Corporation

Flushing Financial Corporation (Nasdaq: FFIC) is the holding company for Flushing Bank®, a New York State-chartered commercial bank insured by the Federal Deposit Insurance Corporation. The Bank serves consumers, businesses, professionals, corporate clients, and public entities by offering a full complement of deposit, loan, equipment finance, and cash management services through its banking offices located in Queens, Brooklyn, Manhattan, and on Long Island. As a leader in real estate lending, the Bank’s experienced lending team creates mortgage solutions for real estate owners and property managers both within and outside the New York City metropolitan area. Flushing Bank is an Equal Housing Lender. The Bank also operates an online banking division consisting of iGObanking.com®, which offers competitively priced deposit products to consumers nationwide, and BankPurely®, an eco-friendly, healthier lifestyle community brand.

Additional information on Flushing Bank and Flushing Financial Corporation may be obtained by visiting the Company’s website at http://www.flushingbank.com. Flushing Financial Corporation’s earnings release and presentation slides will be available prior to the conference call at www.flushingbank.com under investor relations.

“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995: Statements in this Press Release relating to plans, strategies, economic performance and trends, projections of results of specific activities or investments and other statements that are not descriptions of historical facts may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking information is inherently subject to risks and uncertainties, and actual results could differ materially from those currently anticipated due to a number of factors, which include, but are not limited to, risk factors discussed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020 and in other documents filed by the Company with the Securities and Exchange Commission from time to time. Forward-looking statements may be identified by terms such as “may”, “will”, “should”, “could”, “expects”, “plans”, “intends”, “anticipates”, “believes”, “estimates”, “predicts”, “forecasts”, “goals”, “potential” or “continue” or similar terms or the negative of these terms. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. The Company has no obligation to update these forward-looking statements.

Statistical Tables Follow -

Investor Contact: Susan K. Cullen, SEVP, Treasurer and CFO, 718-961-54006


Graphic

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

FINANCIAL HIGHLIGHTS

(Unaudited)

At or for the three months ended

March 31, 

December 31,

September 30,

June 30,

March 31, 

(Dollars in thousands, except per share data)

    

2021

2020

2020

2020

2020

Performance Ratios (1)

 

 

 

 

  

Return on average assets

 

0.93

%  

 

0.18

%  

 

0.81

%  

1.01

%  

 

(0.08)

%  

Return on average equity

 

12.29

 

2.27

 

9.94

13.11

 

(0.96)

Yield on average interest-earning assets (2)

 

3.77

 

3.82

 

3.84

3.81

 

3.98

Cost of average interest-bearing liabilities

 

0.69

 

0.86

 

0.98

1.09

 

1.74

Cost of funds

 

0.61

 

0.77

 

0.89

0.99

 

1.61

Net interest rate spread during period (2)

 

3.08

 

2.96

 

2.86

2.72

 

2.24

Net interest margin (2)

 

3.18

 

3.08

 

3.00

2.87

 

2.44

Non-interest expense to average assets

 

1.87

 

2.43

 

1.69

1.60

 

1.82

Efficiency ratio (3)

 

58.58

 

57.56

 

55.37

54.92

 

68.21

Average interest-earning assets to average interest-bearing liabilities

 

1.18

X

 

1.17

X

 

1.16

X

1.15

X

 

1.13

X

Average Balances

 

 

 

 

Total loans, net

$

6,700,476

$

6,375,516

$

5,904,051

$

5,946,412

$

5,794,866

Total interest-earning assets

 

7,667,217

 

7,243,472

 

6,675,896

6,809,835

 

6,719,857

Total assets

 

8,147,714

 

7,705,407

 

7,083,028

7,206,059

 

7,106,998

Total due to depositors

 

5,361,619

 

4,708,760

 

4,353,560

4,395,228

 

4,578,793

Total interest-bearing liabilities

 

6,475,843

 

6,169,574

 

5,731,899

5,912,774

 

5,951,925

Stockholders' equity

 

619,647

 

609,463

 

576,512

557,414

 

576,597

Per Share Data

 

 

  

 

  

 

  

 

  

 

Book value per common share (4)

$

20.65

$

20.11

$

20.78

$

20.27

$

19.48

Tangible book value per common share (5)

$

19.99

$

19.45

$

20.22

$

19.71

$

18.92

Stockholders' Equity

 

 

  

 

  

 

 

  

Stockholders' equity

$

639,201

$

618,997

$

586,406

$

571,921

$

549,683

Tangible stockholders' equity

 

618,839

 

598,476

 

570,571

556,086

 

533,848

Consolidated Regulatory Capital Ratios

  

 

  

 

  

 

  

 

  

 

Tier 1 capital

$

679,343

$

662,987

$

630,380

$

617,620

$

610,898

Common equity Tier 1 capital

 

636,071

 

621,247

 

593,344

583,238

 

567,306

Total risk-based capital

 

806,922

 

794,034

 

740,499

726,291

 

712,761

Risk Weighted Assets

6,281,136

6,287,598

5,381,938

5,406,104

5,418,219

Tier 1 leverage capital (well capitalized = 5%)

 

8.44

%  

 

8.38

%  

 

9.03

%  

8.64

%  

 

8.59

%  

Common equity Tier 1 risk-based capital (well capitalized = 6.5%)

 

10.13

 

9.88

 

11.02

10.79

 

10.47

Tier 1 risk-based capital (well capitalized = 8.0%)

 

10.82

 

10.54

 

11.71

11.42

 

11.28

Total risk-based capital (well capitalized = 10.0%)

 

12.85

 

12.63

 

13.76

13.43

 

13.16

Capital Ratios

 

  

 

  

 

  

  

 

  

Average equity to average assets

 

7.61

%  

 

7.91

%  

 

8.14

%  

7.74

%  

 

8.11

%  

Equity to total assets

 

7.83

 

7.76

 

8.30

7.98

 

7.59

Tangible common equity to tangible assets (6)

 

7.60

 

7.52

 

8.10

7.78

 

7.38

Asset Quality

 

  

 

  

 

  

  

 

  

Non-accrual loans (7)

$

18,604

$

18,325

$

24,792

$

20,038

$

16,752

Non-performing loans

 

21,186

 

21,073

 

24,792

20,188

 

16,752

Non-performing assets

 

21,221

 

21,108

 

24,827

20,431

 

16,995

Net charge-offs

 

2,865

 

646

 

837

1,007

 

1,149

Asset Quality Ratios

 

  

 

  

 

  

  

 

  

Non-performing loans to gross loans

 

0.31

%  

 

0.31

%  

 

0.42

%  

0.34

%  

 

0.28

%  

Non-performing assets to total assets

 

0.26

 

0.26

 

0.35

0.29

 

0.23

Allowance for loan losses to gross loans

 

0.67

 

0.67

 

0.65

0.61

 

0.47

Allowance for loan losses to non-performing assets

 

212.52

 

213.91

 

154.44

179.68

 

165.32

Allowance for loan losses to non-performing loans

 

212.87

 

214.27

 

154.66

181.85

 

167.73

Net charge-offs to average loans

0.17

0.04

0.06

0.07

0.08

Full-service customer facilities

 

25

 

25

 

20

20

 

20

(see footnotes on next page)

Investor Contact: Susan K. Cullen, SEVP, Treasurer and CFO, 718-961-54007


Graphic


(1) Ratios are presented on an annualized basis, where appropriate.

(2) Yields are calculated on the tax equivalent basis using the statutory federal income tax rate of 21% for the periods presented.

(3) Efficiency ratio, a non-GAAP measure, was calculated by dividing non-interest expense (excluding merger expense, OREO expense, prepayment penalty on borrowings, the net gain/loss from the sale of OREO and net amortization of purchase accounting adjustments) by the total of net interest income (excluding net gains and losses from fair value adjustments on qualifying hedges and net amortization of purchase accounting adjustments) and non-interest income (excluding life insurance proceeds, net gains and losses from the sale or disposition of securities, assets and fair value adjustments).

(4) Calculated by dividing stockholders’ equity by shares outstanding.

(5) Calculated by dividing tangible stockholders’ common equity, a non-GAAP measure, by shares outstanding. Tangible stockholders’ common equity is stockholders’ equity less intangible assets (goodwill, net of deferred taxes). See “Calculation of Tangible Stockholders’ Common Equity to Tangible Assets”.

(6) See “Calculation of Tangible Stockholders’ Common Equity to Tangible Assets”.

(7) Excludes performing non-accrual TDR loans.

Investor Contact: Susan K. Cullen, SEVP, Treasurer and CFO, 718-961-54008


Graphic

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

For the three months ended

March 31, 

December 31,

September 30,

June 30,

March 31, 

(In thousands, except per share data)

2021

2020

2020

2020

2020

Interest and Dividend Income

  

Interest and fees on loans

$

69,021

$

66,120

$

60,367

$

60,557

$

61,109

Interest and dividends on securities:

 

 

 

 

 

Interest

 

3,072

 

2,813

 

3,525

 

4,182

 

5,256

Dividends

 

8

 

8

 

9

 

11

 

15

Other interest income

 

36

 

30

 

13

 

22

 

290

Total interest and dividend income

 

72,137

 

68,971

 

63,914

 

64,772

 

66,670

Interest Expense

 

 

 

 

 

  

Deposits

 

6,105

 

6,470

 

7,093

 

9,971

 

18,778

Other interest expense

 

5,140

 

6,769

 

6,897

 

6,084

 

7,066

Total interest expense

 

11,245

 

13,239

 

13,990

 

16,055

 

25,844

Net Interest Income

 

60,892

 

55,732

 

49,924

 

48,717

 

40,826

Provision for credit losses

 

2,820

 

3,862

 

2,470

 

9,619

 

7,178

Net Interest Income After Provision for Credit Losses

 

58,072

 

51,870

 

47,454

 

39,098

 

33,648

Non-interest Income

 

 

 

 

 

  

Banking services fee income

 

2,725

 

1,442

 

1,316

 

944

 

798

Net loss on sale of securities

 

 

(610)

 

 

(54)

 

(37)

Net gain on sale of loans

 

31

 

6

 

 

 

42

Net gain on disposition of assets

 

621

 

 

 

 

Net gain (loss) from fair value adjustments

 

982

 

(4,129)

 

(2,225)

 

10,205

 

(5,993)

Federal Home Loan Bank of New York stock dividends

 

689

 

734

 

874

 

881

 

964

Life insurance proceeds

 

 

 

 

659

 

Bank owned life insurance

 

997

 

1,016

 

923

 

932

 

943

Other income

 

266

 

360

 

463

 

170

 

419

Total non-interest income (loss)

 

6,311

 

(1,181)

 

1,351

 

13,737

 

(2,864)

Non-interest Expense

 

 

 

 

 

  

Salaries and employee benefits

 

22,664

 

22,089

 

17,335

 

16,184

 

18,620

Occupancy and equipment

 

3,367

 

3,446

 

3,021

 

2,827

 

2,840

Professional services

 

2,400

 

2,463

 

2,064

 

1,985

 

2,862

FDIC deposit insurance

 

1,213

 

562

 

727

 

737

 

650

Data processing

 

2,109

 

3,411

 

1,668

 

1,813

 

1,694

Depreciation and amortization

 

1,639

 

1,579

 

1,542

 

1,555

 

1,536

Other real estate owned/foreclosure (recoveries) expense

 

(10)

 

95

 

240

 

45

 

(164)

Net loss from sales of real estate owned

 

 

 

5

 

 

31

Prepayment penalty on borrowings

7,834

Other operating expenses

 

4,777

 

5,332

 

3,383

 

3,609

 

4,311

Total non-interest expense

 

38,159

 

46,811

 

29,985

 

28,755

 

32,380

Income (loss) Before Income Taxes

 

26,224

 

3,878

 

18,820

 

24,080

 

(1,596)

Provision (benefit) for Income Taxes

 

 

 

 

 

  

Federal

 

5,071

 

533

 

3,359

 

4,307

 

989

State and local

 

2,114

 

(116)

 

1,130

 

1,501

 

(1,195)

Total taxes

 

7,185

 

417

 

4,489

 

5,808

 

(206)

Net Income (loss)

$

19,039

$

3,461

$

14,331

$

18,272

$

(1,390)

Basic earnings (loss) per common share

$

0.60

$

$0.11

$

$0.50

$

$0.63

$

($0.05)

Diluted earnings (loss) per common share

$

0.60

$

$0.11

$

$0.50

$

$0.63

$

($0.05)

Dividends per common share

$

$0.21

$

$0.21

$

$0.21

$

$0.21

$

$0.21

Basic average shares

 

31,604

 

30,603

 

28,874

 

28,867

 

28,853

Diluted average shares

 

31,604

 

30,603

 

28,874

 

28,867

 

28,853

Investor Contact: Susan K. Cullen, SEVP, Treasurer and CFO, 718-961-54009


Graphic

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

(Unaudited)

March 31, 

    

December 31,

    

September 30,

    

June 30,

    

March 31, 

(Dollars in thousands)

2021

2020

2020

2020

2020

ASSETS

 

  

 

  

 

  

 

  

 

  

Cash and due from banks

$

174,420

$

157,388

$

75,560

$

84,754

$

157,184

Securities held-to-maturity:

 

 

 

 

 

Mortgage-backed securities

 

7,909

 

7,914

 

7,919

 

7,924

 

7,929

Other securities

 

49,912

 

49,918

 

50,252

 

50,078

 

50,225

Securities available for sale:

 

 

 

Mortgage-backed securities

 

518,781

 

404,460

 

386,235

 

442,507

 

489,556

Other securities

 

242,440

 

243,514

 

234,721

 

232,803

 

225,856

Loans

6,745,316

6,704,674

5,941,398

5,983,275

5,932,088

Allowance for loan losses

 

(45,099)

 

(45,153)

 

(38,343)

 

(36,710)

 

(28,098)

Net loans

 

6,700,217

 

6,659,521

 

5,903,055

 

5,946,565

 

5,903,990

Interest and dividends receivable

 

44,941

 

44,041

 

36,068

 

30,219

 

25,526

Bank premises and equipment, net

 

27,498

 

28,179

 

25,766

 

27,018

 

27,899

Federal Home Loan Bank of New York stock

 

41,498

 

43,439

 

57,119

 

56,400

 

74,000

Bank owned life insurance

 

182,707

 

181,710

 

158,701

 

157,779

 

158,655

Goodwill

 

17,636

 

17,636

 

16,127

 

16,127

 

16,127

Other real estate owned, net

 

 

 

 

208

 

208

Core deposit intangibles

3,013

3,172

Right of use asset

 

53,802

 

50,743

 

42,326

 

38,303

 

39,729

Other assets

 

94,410

 

84,759

 

69,207

 

71,974

 

68,526

Total assets

$

8,159,184

$

7,976,394

$

7,063,056

$

7,162,659

$

7,245,410

LIABILITIES

 

  

 

  

 

  

 

 

  

Deposits

$

6,326,577

$

6,090,733

$

4,906,359

$

5,049,874

$

4,828,435

Mortgagors' escrow deposits

74,348

45,622

 

57,136

 

48,525

 

73,051

Borrowed funds

 

948,920

 

1,020,895

 

1,323,975

 

1,305,187

 

1,617,582

Operating lease liability

 

58,080

 

59,100

 

49,737

 

45,897

 

47,726

Other liabilities

 

112,058

 

141,047

 

139,443

 

141,255

 

128,933

Total liabilities

 

7,519,983

 

7,357,397

 

6,476,650

 

6,590,738

 

6,695,727

STOCKHOLDERS' EQUITY

 

  

 

  

 

  

 

 

  

Preferred stock (5,000,000 shares authorized; none issued)

 

 

 

 

 

Common stock ($0.01 par value; 100,000,000 shares authorized)

 

341

 

341

 

315

 

315

 

315

Additional paid-in capital

 

260,019

 

261,533

 

227,877

 

226,901

 

225,893

Treasury stock

 

(65,479)

 

(69,400)

 

(69,409)

 

(69,436)

 

(69,540)

Retained earnings

 

455,023

 

442,789

 

445,931

 

437,663

 

425,455

Accumulated other comprehensive loss, net of taxes

 

(10,703)

 

(16,266)

 

(18,308)

 

(23,522)

 

(32,440)

Total stockholders' equity

 

639,201

 

618,997

 

586,406

 

571,921

 

549,683

Total liabilities and stockholders' equity

$

8,159,184

$

7,976,394

$

7,063,056

$

7,162,659

$

7,245,410

(In thousands)

Issued shares

34,088

34,088

31,531

31,531

31,531

Outstanding shares

30,954

30,776

28,218

28,217

28,214

Treasury shares

3,133

3,312

3,312

3,313

3,317

Investor Contact: Susan K. Cullen, SEVP, Treasurer and CFO, 718-961-540010


Graphic

 

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

AVERAGE BALANCE SHEETS

(Unaudited)

For the three months ended

March 31, 

December 31,

September 30,

June 30,

March 31, 

(In thousands)

2021

2020

2020

2020

2020

Interest-earning Assets:

 

  

  

  

  

  

Mortgage loans, net

$

5,155,975

$

5,010,097

$

4,721,742

$

4,762,068

$

4,697,531

Other loans, net

 

1,544,501

 

1,365,419

 

1,182,309

 

1,184,344

 

1,097,335

Total loans, net

 

6,700,476

 

6,375,516

 

5,904,051

 

5,946,412

 

5,794,866

Taxable securities:

 

  

 

  

 

  

 

  

 

  

Mortgage-backed securities

 

433,917

 

413,875

 

413,902

 

465,365

 

507,912

Other securities

 

300,828

 

266,663

 

243,754

 

243,867

 

243,726

Total taxable securities

 

734,745

 

680,538

 

657,656

 

709,232

 

751,638

Tax-exempt securities:

 

  

 

  

 

  

 

  

 

  

Other securities

 

50,828

 

50,768

 

51,652

 

60,280

 

63,535

Total tax-exempt securities

 

50,828

 

50,768

 

51,652

 

60,280

 

63,535

Interest-earning deposits and federal funds sold

 

181,168

 

136,650

 

62,537

 

93,911

 

109,818

Total interest-earning assets

 

7,667,217

 

7,243,472

 

6,675,896

 

6,809,835

 

6,719,857

Other assets

 

480,497

 

461,935

 

407,132

 

396,224

 

387,141

Total assets

$

8,147,714

$

7,705,407

$

7,083,028

$

7,206,059

$

7,106,998

Interest-bearing Liabilities:

 

  

 

  

 

  

 

  

 

  

Deposits:

 

  

 

  

 

  

 

  

 

  

Savings accounts

$

170,079

$

163,382

$

160,100

$

188,587

$

194,026

NOW accounts

 

2,183,356

 

1,924,840

 

1,625,109

 

1,440,147

 

1,419,739

Money market accounts

 

1,905,543

 

1,507,245

 

1,461,996

 

1,580,652

 

1,697,783

Certificate of deposit accounts

 

1,102,641

 

1,113,293

 

1,106,355

 

1,185,842

 

1,267,245

Total due to depositors

 

5,361,619

 

4,708,760

 

4,353,560

 

4,395,228

 

4,578,793

Mortgagors' escrow accounts

 

65,372

 

75,005

 

55,868

 

87,058

 

65,503

Total interest-bearing deposits

 

5,426,991

 

4,783,765

 

4,409,428

 

4,482,286

 

4,644,296

Borrowings

 

1,048,852

 

1,385,809

 

1,322,471

 

1,430,488

 

1,307,629

Total interest-bearing liabilities

 

6,475,843

 

6,169,574

 

5,731,899

 

5,912,774

 

5,951,925

Non interest-bearing demand deposits

 

858,080

 

731,170

 

589,674

 

560,637

 

449,761

Other liabilities

 

194,144

 

195,200

 

184,943

 

175,234

 

128,715

Total liabilities

 

7,528,067

 

7,095,944

 

6,506,516

 

6,648,645

 

6,530,401

Equity

 

619,647

 

609,463

 

576,512

 

557,414

 

576,597

Total liabilities and equity

$

8,147,714

$

7,705,407

$

7,083,028

$

7,206,059

$

7,106,998

Net interest-earning assets

$

1,191,374

$

1,073,898

$

943,997

$

897,061

$

767,932

Investor Contact: Susan K. Cullen, SEVP, Treasurer and CFO, 718-961-540011


Graphic

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

NET INTEREST INCOME AND NET INTEREST MARGIN

(Unaudited)

For the three months ended

March 31, 

December 31,

September 30,

June 30,

March 31, 

(Dollars in thousands)

2021

2020

2020

2020

2020

Interest Income:

 

  

  

  

  

  

Mortgage loans, net

$

55,219

$

53,777

$

49,814

$

49,719

$

49,412

Other loans, net

 

13,802

 

12,343

 

10,553

 

10,838

 

11,697

Total loans, net

 

69,021

 

66,120

 

60,367

 

60,557

 

61,109

Taxable securities:

 

  

 

  

 

  

 

  

 

  

Mortgage-backed securities

 

1,698

 

1,435

 

1,928

 

2,327

 

3,040

Other securities

 

963

 

957

 

1,166

 

1,358

 

1,697

Total taxable securities

 

2,661

 

2,392

 

3,094

 

3,685

 

4,737

Tax-exempt securities:

 

  

 

  

 

  

 

  

 

  

Other securities

 

530

 

543

 

557

 

643

 

676

Total tax-exempt securities

 

530

 

543

 

557

 

643

 

676

Interest-earning deposits and federal funds sold

 

36

 

30

 

13

 

22

 

290

Total interest-earning assets

 

72,248

 

69,085

 

64,031

 

64,907

 

66,812

Interest Expense:

 

  

 

  

 

  

 

  

 

  

Deposits:

 

  

 

  

 

  

 

  

 

  

Savings accounts

$

75

$

75

$

65

$

74

$

281

NOW accounts

 

1,706

 

1,320

1,242

2,099

4,648

Money market accounts

 

2,100

 

2,010

2,108

3,208

7,042

Certificate of deposit accounts

 

2,222

 

3,065

3,700

4,564

6,767

Total due to depositors

 

6,103

 

6,470

 

7,115

 

9,945

 

18,738

Mortgagors' escrow accounts

 

2

 

(22)

26

40

Total interest-bearing deposits

 

6,105

 

6,470

 

7,093

 

9,971

 

18,778

Borrowings

 

5,140

 

6,769

6,897

6,084

7,066

Total interest-bearing liabilities

 

11,245

 

13,239

 

13,990

 

16,055

 

25,844

Net interest income- tax equivalent

$

61,003

$

55,846

$

50,041

$

48,852

$

40,968

Included in net interest income above:

Prepayment penalties received on loans and securities and net of reversals and recovered interest from non-accrual loans

$

947

$

1,093

$

1,518

$

776

$

1,189

Net gains/(losses) from fair value adjustments on qualifying hedges included in loan interest income

1,427

1,023

230

(365)

(2,073)

Purchase accounting adjustments

922

11

Interest-earning Assets Yields:

 

  

  

  

  

  

Mortgage loans, net

4.28

%  

4.29

%  

4.22

%  

4.18

%  

4.21

%  

Other loans, net

 

3.57

 

3.62

3.57

3.66

4.26

Total loans, net

 

4.12

 

4.15

4.09

4.07

4.22

Taxable securities:

 

  

 

  

  

  

  

Mortgage-backed securities

 

1.57

 

1.39

1.86

2.00

2.39

Other securities

 

1.28

 

1.44

1.91

2.23

2.79

Total taxable securities

 

1.45

 

1.41

1.88

2.08

2.52

Tax-exempt securities: (1)

 

  

 

  

  

  

  

Other securities

 

4.17

 

4.28

4.31

4.27

4.26

Total tax-exempt securities

 

4.17

 

4.28

4.31

4.27

4.26

Interest-earning deposits and federal funds sold

 

0.08

 

0.09

0.08

0.09

1.06

Total interest-earning assets

 

3.77

%  

3.82

%  

3.84

%  

3.81

%  

3.98

%  

Interest-bearing Liabilities Yields:

 

  

 

  

  

 

  

 

  

Deposits:

 

  

 

  

  

 

  

 

  

Savings accounts

0.18

%  

0.18

%  

0.16

%  

0.16

%  

0.58

%  

NOW accounts

 

0.31

 

0.27

0.31

0.58

1.31

Money market accounts

 

0.44

 

0.53

0.58

0.81

1.66

Certificate of deposit accounts

 

0.81

 

1.10

1.34

1.54

2.14

Total due to depositors

 

0.46

 

0.55

0.65

0.91

1.64

Mortgagors' escrow accounts

 

0.01

 

(0.16)

0.12

0.24

Total interest-bearing deposits

 

0.45

 

0.54

0.64

0.89

1.62

Borrowings

 

1.96

 

1.95

2.09

1.70

2.16

Total interest-bearing liabilities

 

0.69

%  

0.86

%  

0.98

%  

1.09

%  

1.74

%  

Net interest rate spread (tax equivalent)

3.08

%  

2.96

%  

2.86

%  

2.72

%  

2.24

%  

Net interest margin (tax equivalent)

3.18

%  

3.08

%  

3.00

%  

2.87

%  

2.44

%  

Ratio of interest-earning assets to interest-bearing liabilities

1.18

X

1.17

X

1.16

X

1.15

X

1.13

X


(1) Yields are calculated on the tax equivalent basis using the statutory federal income tax rate of 21% for the periods presented.

Investor Contact: Susan K. Cullen, SEVP, Treasurer and CFO, 718-961-540012


Graphic

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

DEPOSIT and LOAN COMPOSITION

(Unaudited)

Deposit Composition

March 2021 vs.

March 2021 vs.

March 31, 

December 31,

September 30,

June 30,

March 31, 

December 2020

March 2020

(Dollars in thousands)

    

2021

    

2020

    

2020

    

2020

    

2020

    

% Change

    

% Change

Deposits

  

  

  

  

  

  

  

 

Non-interest bearing

$

917,189

$

778,672

$

607,954

$

581,881

$

489,198

17.8

%

87.5

%

Interest bearing:

  

  

  

  

  

  

  

 

Certificate of deposit accounts

 

1,070,595

 

1,138,361

 

1,051,644

 

1,135,977

 

1,172,381

 

(6.0)

 

(8.7)

Savings accounts

 

170,272

 

168,183

 

160,294

 

184,895

 

192,192

 

1.2

 

(11.4)

Money market accounts

 

1,990,656

 

1,682,345

 

1,381,552

 

1,474,880

 

1,597,109

 

18.3

 

24.6

NOW accounts

 

2,177,865

 

2,323,172

 

1,704,915

 

1,672,241

 

1,377,555

 

(6.3)

 

58.1

Total interest-bearing deposits

 

5,409,388

 

5,312,061

 

4,298,405

 

4,467,993

 

4,339,237

 

1.8

 

24.7

Total deposits

$

6,326,577

$

6,090,733

$

4,906,359

$

5,049,874

$

4,828,435

3.9

%  

 

31.0

%

Loan Composition

March 2021 vs.

March 2021 vs.

March 31, 

December 31,

September 30,

June 30,

March 31, 

December 2020

March 2020

(Dollars in thousands)

    

2021

    

2020

    

2020

    

2020

    

2020

    

% Change

    

% Change

Loans held for investment:

  

  

  

  

  

  

  

 

Multi-family residential

$

2,525,967

$

2,533,952

$

2,252,757

$

2,285,555

$

2,272,343

(0.3)

%  

 

11.2

%  

Commercial real estate

 

1,721,702

 

1,754,754

 

1,636,659

 

1,646,085

 

1,664,934

(1.9)

 

3.4

One-to-four family ― mixed-use property

 

595,431

 

602,981

 

585,159

 

591,347

 

592,109

(1.3)

 

0.6

One-to-four family ― residential

 

239,391

 

245,211

 

191,011

 

184,741

 

189,774

(2.4)

 

26.1

Co-operative apartments

 

7,965

 

8,051

 

8,132

 

8,423

 

8,493

(1.1)

 

(6.2)

Construction

 

61,528

 

83,322

 

63,567

 

69,433

 

66,727

(26.2)

 

(7.8)

Mortgage Loans

5,151,984

5,228,271

4,737,285

4,785,584

4,794,380

(1.5)

 

7.5

Small Business Administration (1)

 

267,120

 

167,376

 

124,649

 

106,813

 

14,076

59.6

 

1,797.7

Taxi medallion

 

 

2,757

 

2,317

 

3,269

 

3,281

(100.0)

 

(100.0)

Commercial business and other

 

1,326,657

 

1,303,225

 

1,063,429

 

1,073,623

 

1,104,967

1.8

 

20.1

Non-mortgage loans

1,593,777

1,473,358

1,190,395

1,183,705

1,122,324

8.2

 

42.0

Net unamortized premiums and unearned loan fees (2)

 

(445)

 

3,045

 

13,718

 

13,986

 

15,384

(114.6)

 

(102.9)

Allowance for loan losses

 

(45,099)

 

(45,153)

 

(38,343)

 

(36,710)

 

(28,098)

(0.1)

 

60.5

Net loans

$

6,700,217

$

6,659,521

$

5,903,055

$

5,946,565

$

5,903,990

0.6

%  

 

13.5

%  


(1) Includes $251.0 million, $151.9 million, $111.6 million and $93.2 million of PPP loans at March, 31, 2021, December 31, 2020, September 30, 2020 and June 30, 2020, respectively.

(2) Includes $10.5 million and $11.3 million of purchase accounting unamortized discount resulting from the acquisition of Empire Bancorp at March 31, 2021 and December 31, 2020, respectively.

Investor Contact: Susan K. Cullen, SEVP, Treasurer and CFO, 718-961-540013


Graphic

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

LOAN CLOSINGS, RATES, and FORBEARANCE DETAIL

(Unaudited)

Loan Closings

For the three months ended

March 31, 

December 31,

September 30,

June 30,

March 31, 

(In thousands)

    

2021

    

2020

    

2020

    

2020

    

2020

Multi-family residential

$

58,553

$

52,024

$

33,733

$

59,654

$

67,318

Commercial real estate

17,156

57,634

26,644

8,003

99,571

One-to-four family – mixed-use property

 

8,712

 

9,692

 

3,867

 

8,117

 

13,455

One-to-four family – residential

 

3,131

 

8,422

 

2,296

 

2,674

 

8,413

Co-operative apartments

 

 

 

 

 

704

Construction

 

7,123

 

6,869

 

5,420

 

2,821

 

6,749

Mortgage Loans

94,675

134,641

71,960

81,269

196,210

Small Business Administration (1)

 

125,093

 

598

 

18,456

 

93,241

 

57

Commercial business and other

 

103,118

 

180,787

 

65,160

 

59,287

 

102,448

Non-mortgage Loans

228,211

181,385

83,616

152,528

102,505

Total

$

322,886

$

316,026

$

155,576

$

233,797

$

298,715


(1) Includes $123.2 million, $18.4 million and $93.2 million of PPP closings for the three months ended March 31, 2021, September 30, 2020 and June 30, 2020, respectively.

Weighted Average Rate on Loan Closings

For the three months ended

    

March 31, 

December 31,

September 30,

June 30,

March 31, 

Loan type

 

2021

2020

2020

2020

2020

Mortgage loans

 

3.47

%  

3.47

%  

3.56

%  

3.79

%  

3.93

%  

Non-mortgage loans

 

2.26

3.37

2.81

1.99

4.23

Total loans

 

2.62

%  

3.41

%  

3.16

%  

2.62

%  

4.03

%  

Excluding PPP loans

 

3.62

%  

3.41

%  

3.45

%  

3.71

%  

4.03

%  

Forbearance Detail

Loans paying interest only comprise 61% of forbearance loans; excluding this forbearance loans were only 1.7% of loans

(Dollars in thousands)

Forbearances (1)

Backed by Mortgages (1)

    

Balance

    

% of Sector

    

Balance

    

% of Forbearances

LTV

Higher Risk Segments

Restaurants and Catering Halls

$

15,578

 

17.0

%  

 

$

15,578

 

100.0

%  

31.6

%  

Hotels

 

107,867

 

56.6

 

 

107,867

 

100.0

50.3

Travel and Leisure

 

37,670

 

21.0

 

 

37,670

 

100.0

36.9

Retail Services (2)

 

12,046

 

6.5

 

 

3,169

 

26.3

36.9

CRE - Single Tenant

 

275

 

0.2

 

 

275

 

100.0

51.9

CRE - Strip Mall

 

9,785

 

3.4

 

 

9,785

 

100.0

47.3

Transportation (2)

 

7,463

 

4.9

 

 

 

Contractors (2)

 

2,131

 

0.6

 

 

723

 

33.9

58.3

Schools and Child Care

 

10,260

 

14.4

 

 

10,260

 

100.0

55.5

   Subtotal

$

203,075

 

10.5

%  

 

$

185,327

 

91.3

%  

44.6

%  

Lower Risk Segments

$

92,452

 

1.9

%  

 

$

90,404

 

97.8

%  

33.8

%  

   Total

$

295,527

 

4.4

%  

 

$

275,731

 

93.3

%  

40.4

%  


(1)Represents dollar amount granted at modification
(2)Loans not backed by mortgages are collateralized by equipment

Investor Contact: Susan K. Cullen, SEVP, Treasurer and CFO, 718-961-540014


Graphic

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

ASSET QUALITY

(Unaudited)

Allowance for Loan Losses

For the Three Months Ended

    

March 31, 

December 31,

September 30,

June 30,

March 31, 

(Dollars in thousands)

    

2021

2020

2020

2020

2020

Allowance for loan losses

Beginning balances

$

45,153

$

38,343

$

36,710

$

28,098

$

21,751

Adoption of Current Expected Credit Losses

379

Multi-family residential

    

33

    

(11)

    

(14)

    

(7)

    

(6)

    

Commercial real estate

    

 

64

    

 

    

 

    

 

    

 

    

One-to-four family – mixed-use property

    

 

19

    

 

    

 

(60)

    

 

3

    

 

(78)

    

One-to-four family – residential

    

 

(5)

    

 

(2)

    

 

(2)

    

 

(3)

    

 

(5)

    

Small Business Administration

    

 

(10)

    

 

(3)

    

 

(47)

    

 

165

    

 

(7)

    

Taxi medallion

    

 

2,758

    

 

124

    

 

951

    

    

 

    

Commercial business and other

    

 

6

    

 

538

    

 

9

    

 

849

    

 

1,245

    

Total net loan charge-offs

    

2,865

646

837

1,007

1,149

Provision for loan losses

2,811

3,357

2,470

9,619

7,117

Allowance recorded at the time of Acquisition

4,099

Ending balance

$

45,099

$

45,153

$

38,343

$

36,710

$

28,098

    

 

  

 

  

 

  

 

  

 

  

Gross charge-offs

$

2,922

$

752

$

964

$

1,030

$

1,259

Gross recoveries

57

106

127

23

110

Allowance for loan losses to gross loans

0.67

%

0.67

%

0.65

%

0.61

%

0.47

%

Net loan charge-offs to average loans

0.17

0.04

0.06

0.07

0.08

Non-Performing Assets

    

March 31, 

December 31,

September 30,

June 30,

March 31, 

(Dollars in thousands)

    

2021

2020

2020

2020

2020

Loans 90 Days Or More Past Due and Still Accruing:

 

  

 

  

 

  

 

  

 

  

Multi-family residential

$

201

$

201

$

$

$

Commercial real estate

2,547

Construction

2,381

Commercial business and other

150

Total

 

2,582

 

2,748

 

 

150

 

 

  

 

  

 

  

 

  

 

  

Non-accrual Loans:

 

  

 

  

 

  

 

  

 

  

Multi-family residential

 

4,338

 

2,524

 

2,661

 

3,688

 

2,741

Commercial real estate

 

8

 

1,683

 

2,657

 

2,671

 

8

One-to-four family - mixed-use property (1)

 

2,355

 

1,366

 

1,366

 

2,511

 

607

One-to-four family - residential

 

7,335

 

5,854

 

6,454

 

6,412

 

5,158

Small Business Administration

 

1,151

 

1,151

 

1,151

 

1,321

 

1,518

Taxi medallion(1)

 

 

2,317

 

2,218

 

1,757

 

1,761

Commercial business and other(1)

 

3,417

 

3,430

 

8,285

 

1,678

 

4,959

Total

 

18,604

 

18,325

 

24,792

 

20,038

 

16,752

 

  

 

  

 

  

 

  

 

  

Total Non-performing Loans

 

21,186

 

21,073

 

24,792

 

20,188

 

16,752

 

  

 

  

 

  

 

  

 

  

Other Non-performing Assets:

 

  

 

  

 

  

 

  

 

  

Real estate acquired through foreclosure

 

 

 

 

208

 

208

Other asset acquired through foreclosure

 

35

 

35

 

35

 

35

 

35

Total

 

35

 

35

 

35

 

243

 

243

 

  

 

  

 

  

 

  

 

  

Total Non-performing Assets

$

21,221

$

21,108

$

24,827

$

20,431

$

16,995

 

  

 

  

 

  

 

  

 

  

Non-performing Assets to Total Assets

 

0.26

%  

 

0.26

%  

 

0.35

%  

 

0.29

%  

 

0.23

%  

Allowance For Loan Losses to Non-performing Loans

 

212.9

%  

 

214.3

%  

 

154.7

%  

 

181.8

%  

 

167.7

%  


(1) Not included in the above analysis are non-accrual performing TDR one-to-four family mixed use property loans totaling $0.3 million each in 1Q21, 4Q20 and 3Q20; non-accrual performing TDR taxi medallion loans totaling $0.4 million in 4Q20, $0.1 million in 3Q20, $1.5 million in 2Q20, and $1.5 million in 1Q20, and non-accrual performing TDR commercial business loans totaling $2.2 million each in 1Q21 and 4Q20, respectively;  $1.0 million each in 3Q20, 2Q20, 1Q20, respectively.

Investor Contact: Susan K. Cullen, SEVP, Treasurer and CFO, 718-961-540015


Graphic

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

RECONCILIATION OF GAAP EARNINGS and CORE EARNINGS

Non-cash Fair Value Adjustments to GAAP Earnings

The variance in GAAP and core earnings is partly driven by the impact of non-cash net gains and losses from fair value adjustments. These fair value adjustments relate primarily to swaps designated to protect against rising rates and borrowing carried at fair value under the fair value option. As the swaps get closer to maturity, the volatility in fair value adjustments will dissipate. In a declining interest rate environment, the movement in the curve exaggerates our mark-to-market loss position. In a rising interest rate environment or a steepening of the yield curve, the loss position would experience an improvement.

Core Net Income, Core Diluted EPS, Core ROAE, Core ROAA, Pre-provision Pre-tax Net Revenue, Core Net Interest Income FTE, Core Net Interest Margin FTE, Base Net Interest Income FTE, Base Net Interest Margin FTE, Core Interest Income and Yield on Total Loans, Base Interest Income and Yield on Total Loans, Core Non-interest Income, Core Non-interest Expense and tangible book value per common share are each non-GAAP measures used in this release. A reconciliation to the most directly comparable GAAP financial measures appears below in tabular form. The Company believes that these measures are useful for both investors and management to understand the effects of certain interest and non-interest items and provide an alternative view of the Company's performance over time and in comparison to the Company's competitors. These measures should not be viewed as a substitute for net income. The Company believes that tangible book value per common share is useful for both investors and management as these are measures commonly used by financial institutions, regulators and investors to measure the capital adequacy of financial institutions. The Company believes these measures facilitate comparison of the quality and composition of the Company's capital over time and in comparison to its competitors. These measures should not be viewed as a substitute for total shareholders' equity.

These non-GAAP measures have inherent limitations, are not required to be uniformly applied and are not audited. They should not be considered in isolation or as a substitute for analysis of results reported under GAAP. These non-GAAP measures may not be comparable to similarly titled measures reported by other companies.

Investor Contact: Susan K. Cullen, SEVP, Treasurer and CFO, 718-961-540016


Graphic

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

RECONCILIATION OF GAAP EARNINGS and CORE EARNINGS

(Unaudited)

Three Months Ended

    

March 31, 

December 31,

September 30,

June 30,

March 31, 

(Dollars In thousands, except per share data)

2021

2020

2020

2020

2020

GAAP income (loss) before income taxes

$

26,224

$

3,878

$

18,820

$

24,080

$

(1,596)

Day 1, Provision for Credit Losses - Empire transaction (Provision for credit losses)

1,818

Net (gain) loss from fair value adjustments (Non-interest income (loss))

 

(982)

 

4,129

 

2,225

 

(10,205)

 

5,993

Net loss on sale of securities (Non-interest income (loss))

 

 

610

 

 

54

 

37

Life insurance proceeds (Non-interest income (loss))

 

 

 

 

(659)

 

Net gain on disposition of assets (Non-interest income (loss))

 

(621)

 

 

 

 

Net (gain) loss from fair value adjustments on qualifying hedges (Interest and fees on loans)

 

(1,427)

 

(1,023)

 

(230)

 

365

 

2,073

Prepayment penalty on borrowings (Non-interest expense)

7,834

Net amortization of purchase accounting adjustments (Various)

(789)

80

Merger expense (Various)

 

973

 

5,349

 

422

 

194

 

929

Core income before taxes

 

23,378

 

22,675

 

21,237

 

13,829

 

7,436

Provision for income taxes for core income

 

6,405

 

4,891

 

5,069

 

3,532

 

1,936

Core net income

$

16,973

$

17,784

$

16,168

$

10,297

$

5,500

GAAP diluted earnings (loss) per common share

$

0.60

$

0.11

$

0.50

$

0.63

$

(0.05)

Day 1, Provision for Credit Losses - Empire transaction, net of tax

0.05

Net (gain) loss from fair value adjustments, net of tax

 

(0.02)

 

0.11

 

0.06

 

(0.27)

 

0.15

Net loss on sale of securities, net of tax

 

 

0.02

 

 

 

Life insurance proceeds

 

 

 

 

(0.02)

 

Net gain on disposition of assets, net of tax

 

(0.01)

 

 

 

 

Net (gain) loss from fair value adjustments on qualifying hedges, net of tax

 

(0.03)

 

(0.03)

 

(0.01)

 

0.01

 

0.05

Prepayment penalty on borrowings, net of tax

0.20

Net amortization of purchase accounting adjustments, net of tax

(0.02)

Merger expense, net of tax

 

0.02

 

0.14

 

0.01

 

0.01

 

0.02

Core diluted earnings per common share(1)

$

0.54

$

0.58

$

0.56

$

0.36

$

0.19

Core net income, as calculated above

$

16,973

$

17,784

$

16,168

$

10,297

$

5,500

Average assets

 

8,147,714

 

7,705,407

 

7,083,028

 

7,206,059

 

7,106,998

Average equity

 

619,647

 

609,463

 

576,512

 

557,414

 

576,597

Core return on average assets(2)

 

0.83

%  

 

0.92

%  

 

0.91

%  

 

0.57

%  

 

0.31

%  

Core return on average equity(2)

 

10.96

%  

 

11.67

%  

 

11.22

%  

 

7.39

%  

 

3.82

%  


(1) Core diluted earnings per common share may not foot due to rounding.

(2) Ratios are calculated on an annualized basis.

Investor Contact: Susan K. Cullen, SEVP, Treasurer and CFO, 718-961-540017


Graphic

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

RECONCILIATION OF GAAP REVENUE and PRE-PROVISION

PRE-TAX NET REVENUE

(Unaudited)

Three Months Ended

    

    

March 31, 

December 31,

September 30,

June 30,

March 31, 

    

(Dollars In thousands)

2021

    

2020

    

2020

    

2020

    

2020

GAAP Net interest income

$

60,892

$

55,732

$

49,924

$

48,717

$

40,826

Net (gain) loss from fair value adjustments on qualifying hedges

(1,427)

(1,023)

(230)

365

2,073

Net amortization of purchase accounting adjustments

(922)

(11)

Core Net interest income

$

58,543

$

54,698

$

49,694

$

49,082

$

42,899

GAAP Non-interest income (loss)

$

6,311

$

(1,181)

$

1,351

$

13,737

$

(2,864)

Net (gain) loss from fair value adjustments

(982)

4,129

2,225

(10,205)

5,993

Net loss on sale of securities

610

54

37

Life insurance proceeds

(659)

Net gain on sale of assets

(621)

Core Non-interest income

$

4,708

$

3,558

$

3,576

$

2,927

$

3,166

GAAP Non-interest expense

$

38,159

$

46,811

$

29,985

$

28,755

$

32,380

Prepayment penalty on borrowings

(7,834)

Net amortization of purchase accounting adjustments

(133)

(91)

Merger expense

(973)

(5,349)

(422)

(194)

(929)

Core Non-interest expense

$

37,053

$

33,537

$

29,563

$

28,561

$

31,451

GAAP:

Net interest income

$

60,892

$

55,732

$

49,924

$

48,717

$

40,826

Non-interest income (loss)

6,311

(1,181)

1,351

13,737

(2,864)

Non-interest expense

(38,159)

(46,811)

(29,985)

(28,755)

(32,380)

Pre-provision pre-tax net revenue

$

29,044

$

7,740

$

21,290

$

33,699

$

5,582

Core:

Net interest income

$

58,543

$

54,698

$

49,694

$

49,082

$

42,899

Non-interest income

4,708

3,558

3,576

2,927

3,166

Non-interest expense

(37,053)

(33,537)

(29,563)

(28,561)

(31,451)

Pre-provision pre-tax net revenue

$

26,198

$

24,719

$

23,707

$

23,448

$

14,614

Efficiency Ratio

58.6

%

57.6

%

55.4

%

54.9

%

68.2

%

Investor Contact: Susan K. Cullen, SEVP, Treasurer and CFO, 718-961-540018


Graphic

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

RECONCILIATION OF GAAP NET INTEREST INCOME and NET INTEREST MARGIN

to CORE and BASE NET INTEREST INCOME and NET INTEREST MARGIN

(Unaudited)

Three Months Ended

    

March 31, 

December 31,

September 30,

June 30,

March 31, 

(Dollars In thousands)

2021

2020

2020

2020

2020

GAAP net interest income

$

60,892

$

55,732

$

49,924

$

48,717

$

40,826

Net (gain) loss from fair value adjustments on qualifying hedges

 

(1,427)

 

(1,023)

 

(230)

 

365

 

2,073

Net amortization of purchase accounting adjustments

(922)

(11)

Tax equivalent adjustment

111

114

117

135

142

Core net interest income FTE

$

58,654

$

54,812

$

49,811

$

49,217

$

43,041

Prepayment penalties received on loans, net of reversals and recoveries of interest from non-accrual loans

 

(947)

 

(1,093)

 

(1,518)

 

(776)

 

(1,189)

Base net interest income FTE

$

57,707

$

53,719

$

48,293

$

48,441

$

41,852

Total average interest-earning assets (1)

$

7,676,833

$

7,245,147

$

6,675,896

$

6,809,835

$

6,719,857

Core net interest margin FTE

 

3.06

%  

 

3.03

%  

 

2.98

%  

 

2.89

%  

 

2.56

%  

Base net interest margin FTE

 

3.01

%  

 

2.97

%  

 

2.89

%  

 

2.85

%  

 

2.49

%  

GAAP interest income on total loans, net

$

69,021

$

66,120

$

60,367

$

60,557

$

61,109

Net (gain) loss from fair value adjustments on qualifying hedges

 

(1,427)

 

(1,023)

 

(230)

 

365

 

2,073

Net amortization of purchase accounting adjustments

(728)

(356)

Core interest income on total loans, net

$

66,866

$

64,741

$

60,137

$

60,922

$

63,182

Prepayment penalties received on loans, net of reversals and recoveries of interest from non-accrual loans

 

(947)

 

(1,093)

 

(1,443)

 

(776)

 

(1,189)

Base interest income on total loans, net

$

65,919

$

63,648

$

58,694

$

60,146

$

61,993

Average total loans, net (1)

$

6,711,446

$

6,379,429

$

5,904,051

$

5,946,412

$

5,794,866

Core yield on total loans

 

3.99

%  

 

4.06

%  

 

4.07

%  

 

4.10

%  

 

4.36

%  

Base yield on total loans

 

3.93

%  

 

3.99

%  

 

3.98

%  

 

4.05

%  

 

4.28

%  


(1) Excludes purchase accounting average balances for three months ended March 31, 2021, and December 31, 2020.

Investor Contact: Susan K. Cullen, SEVP, Treasurer and CFO, 718-961-540019


Graphic

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

CALCULATION OF TANGIBLE STOCKHOLDERS’

COMMON EQUITY to TANGIBLE ASSETS

(Unaudited)

    

March 31, 

December 31,

September 30,

June 30,

March 31, 

(Dollars in thousands)

2021

2020

2020

2020

2020

Total Equity

$

639,201

$

618,997

$

586,406

$

571,921

$

549,683

Less:

 

  

 

  

 

  

 

  

 

  

Goodwill

 

(17,636)

 

(17,636)

 

(16,127)

 

(16,127)

 

(16,127)

Core deposit Intangibles

(3,013)

(3,172)

Intangible deferred tax liabilities

 

287

 

287

 

292

 

292

 

292

Tangible Stockholders' Common Equity

$

618,839

$

598,476

$

570,571

$

556,086

$

533,848

Total Assets

$

8,159,184

$

7,976,394

$

7,063,056

$

7,162,659

$

7,245,410

Less:

 

  

 

  

 

  

 

  

 

  

Goodwill

 

(17,636)

 

(17,636)

 

(16,127)

 

(16,127)

 

(16,127)

Core deposit Intangibles

(3,013)

(3,172)

Intangible deferred tax liabilities

 

287

 

287

 

292

 

292

 

292

Tangible Assets

$

8,138,822

$

7,955,873

$

7,047,221

$

7,146,824

$

7,229,575

Tangible Stockholders' Common Equity to Tangible Assets

 

7.60

%  

 

7.52

%  

 

8.10

%  

 

7.78

%  

 

7.38

%

Investor Contact: Susan K. Cullen, SEVP, Treasurer and CFO, 718-961-540020


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Cover
Apr. 27, 2021
Cover [Abstract]  
Document Type 8-K
Amendment Flag false
Document Period End Date Apr. 27, 2021
Entity File Number 001-33013
Entity Registrant Name FLUSHING FINANCIAL CORPORATION
Entity Central Index Key 0000923139
Entity Tax Identification Number 11-3209278
Entity Incorporation, State or Country Code DE
Entity Address, Address Line One 220 RXR Plaza
Entity Address, City or Town Uniondale
Entity Address, State or Province NY
Entity Address, Postal Zip Code 11556
City Area Code 718
Local Phone Number 961-5400
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, $0.01 par value
Trading Symbol FFIC
Security Exchange Name NASDAQ
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