Three New Business Development Teams online in the Second Quarter

BROOKLYN, N.Y., July 26, 2018 (GLOBE NEWSWIRE) -- Dime Community Bancshares, Inc. (NASDAQ: DCOM) (the “Company” or “Dime” or “its”), the parent company of Dime Community Bank (the “Bank”), today reported net income of $12.3 million for the quarter ended June 30, 2018, or $0.33 per diluted common share, compared with net income of $14.7 million for the quarter ended March 31, 2018, or $0.39 per diluted common share, and net income of $12.0 million for the quarter ended June 30, 2017, or $0.32 per diluted common share. The linked quarter decline in EPS was attributable to the absence of gains from sales of securities in the current quarter compared to $1.4 million in the prior quarter, a reduction in prepayment related fee income to $1.6 million in the current quarter compared to $2.3 million in the prior quarter, and a $97.4 million linked quarter reduction in average earning-assets due to increased payoffs in the multifamily loan portfolio as the Company continues to focus on re-mixing the loan portfolio via its team-based Business Banking division buildout.

Highlights for the second quarter of 2018 included:

• Robust Business Banking division loan originations of $142.5 million in the second quarter, a 207% increase versus the first quarter of 2018;
• New Business Banking loan originations for the second quarter were at significantly higher rates than the overall loan portfolio; the weighted average rate (“WAR”) on new Business Banking real estate originations was 4.81% and the WAR on new C&I originations was 5.72 % for the three months ended June 30, 2018, compared to the total real estate and C&I loan portfolio WAR of 3.66% at June 30, 2018;
• Strong growth in checking account balances; on a year-over-year basis, the sum of average non-interest bearing checking account balances and average interest-bearing checking account balances increased by 11% to $462.4 million for the current quarter;
• Loan-to-deposit ratio declined to 124% at June 30, 2018, versus 133% at June 30, 2017;
• Consolidated Company commercial real estate (“CRE”) concentration ratio declined to 714.6% at June 30, 2018;
• Newly formed Residential Lending group, led by industry veteran Nancy Tomich, commenced accepting residential loan applications in June 2018; the first loan closing  is expected to take place in early August;
• Nonperforming assets and loans 90 days or more past due on accrual status declined to $6.4 million at June 30, 2018, and represented only 0.10% of total assets at that date;
• Reported book value per share and tangible book value per share (which consists of common equity less goodwill, divided by number of shares outstanding) (see “Non-GAAP Reconciliation” tables at the end of this news release) grew to $16.37 and $14.89, respectively, at June 30, 2018; and
• Successfully completed conversion of core systems in June 2018.

Kenneth J. Mahon, President and CEO of the Company, stated “The strong growth that we experienced in our Business Banking division gives us a great deal of confidence in achieving our full year 2018 portfolio growth targets for this business. The Business Banking division ended the second quarter with approximately $66 million of low-cost relationship-based checking and leasehold deposits at an average cost of approximately 2 basis points, compared to approximately $48 million of checking and leasehold deposits at an average cost of approximately 1 basis point for the first quarter.”

Mr. Mahon concluded, “I want to thank all of Dime’s employees for their dedication and hard work towards successfully completing our core systems conversion. The transition to our new core platform is a key building block in our journey towards becoming a successful community commercial bank.”

Management’s Discussion of Quarterly Operating Results

Net Interest Income

Net interest income in the second quarter of 2018 was $36.1 million, a decrease of $1.9 million (5.0%) from the first quarter of 2018 and a decrease of $1.9 million (5.0%) over the second quarter of 2017. Net interest margin (“NIM”) was 2.39% during the second quarter of 2018, compared to 2.47% in the first quarter of 2018, and 2.57% during the second quarter of 2017.  The linked quarter decrease in NIM was due to a 10 basis point increase in the average cost of funds and a $0.7 million linked quarter reduction in income related to loan prepayment activity.  Net interest margin, excluding income related to prepayment activity decreased by 4 basis points versus the first quarter of 2018.  This compares to a 9 basis point decline when comparing the first quarter of 2018 to the fourth quarter of 2017.

Average interest-earning assets were $6.05 billion for the second quarter of 2018; a 6.3% (annualized) decrease from $6.15 billion for the first quarter of 2018, and a 2.2% increase from $5.92 billion for the second quarter of 2017. The linked quarter decline in average interest-earnings assets was primarily driven by a decline in real estate loans, as the volume of loan payoffs exceeded new originations.

Average securities and other short-term investments were $596.6 million for the second quarter of 2018, a 20.4% (annualized) increase from $567.7 million for the first quarter of 2018, and a 415.4% increase from $115.8 million for the second quarter of 2017.

For the second quarter of 2018, the average yield on interest-earning assets was 3.57%, a decrease of 1 basis point compared with the first quarter of 2018, and an increase of 3 basis points compared to the second quarter of 2017.  The average cost of funds (which includes Federal Home Loan Bank advances) was 1.40% for the second quarter of 2018, an increase of 10 basis points versus the first quarter of 2018, and an increase of 26 basis points versus the second quarter of 2017.

Loans

The real estate loan portfolio declined by $129.6 million (9.7% annualized) during the second quarter of 2018 due primarily to increased loan payoffs versus the first quarter of 2018.  Real estate loan originations were $122.9 million during the second quarter of 2018, at a weighted average interest rate of 4.82%, compared to $75.0 million of originations for the prior quarter, at a weighted average interest rate of 4.17%. Real estate loan amortization and satisfactions totaled $253.2 million, or 19.2% (annualized) of the portfolio balance, at an average rate of 3.73%. The annualized loan payoff rate of 19.2% for the second quarter of 2018 was higher than both the first quarter of 2018 (13.6%) and the second quarter of 2017 (10.5%) due to higher prepayment volume. The increase in real estate loan payoffs during the second quarter of 2018 was primarily due to 1 large relationship that paid off totaling approximately $53.5 million. Average real estate loans were $5.31 billion in the second quarter of 2018, a decrease of $127.6 million (9.4% annualized) from the first quarter of 2018, and a decrease of $451.7 million (7.8%) from the second quarter of 2017.

Included in total real estate loan originations during the second quarter of 2018 were $74.2 million of originations from the Business Banking division at a weighted average rate of 4.81%, compared to $21.2 million of originations at a weighted average rate of 4.21% during the first quarter of 2018.

Commercial and industrial (“C&I”) loan originations were $68.3 million during the second quarter of 2018, at a weighted average rate of 5.72%, compared to $25.3 million at a weighted average rate of 4.81% during the first quarter of 2018. Total C&I loan balances were $172.0 million at the end of the second quarter of 2018, compared to $145.8 million at the end of the first quarter of 2018.  C&I loan amortization and satisfactions totaled $40.5 million due in part to a $22.0 million loan that originated and paid-off during the second quarter, resulting in additional prepayment fee income of $0.2 million. 

Deposits and Borrowed Funds

The Company continues to focus on growing relationship-based deposits sourced from its retail branches and Business Banking division.  Mr. Mahon commented, “A key part of our business model transformation is the generation of low cost deposits, and this was validated by the 11% year-over-year growth in average total checking accounts.”

The average cost of total deposits increased 9 basis points on a linked quarter basis to 1.09% as the Bank increased rates on selective money market and certificates of deposit products in light of increased competition. Overall, total deposits decreased by $71.0 million during the second quarter of 2018 from the linked quarter. Mr. Mahon continued, “Total deposits declined in the second quarter primarily due to $115 million of net outflows from our DimeDirect internet channel. Competition in the online space is not expected to abate in the near term, especially given the recent entry of several large national banks.  Our focus remains on generating core business deposits, and as such our posted online rates now lag other banks by a significant margin. As mentioned previously, we intend to manage the balance sheet and the loan-to-deposit ratio with the goal of keeping deposit betas as low as possible.”

The loan-to-deposit ratio was 124.0% at June 30, 2018, compared to 124.3% at March 31, 2018 and 133.0% at June 30, 2017.

Total borrowings increased slightly by $33.3 million during the second quarter of 2018 as compared to the first quarter of 2018.   Mr. Mahon commented: “Given rising interest rates over the course of the past year we made a conscious decision to extend durations on our borrowings portfolio. At June 30, 2018, only 23% of our $1 billion borrowing portfolio consists of bullet advances that have a remaining term of less than a year, compared to 47% of the $945 million borrowing portfolio from the year-ago period.”

Non-Interest Income

Non-interest income was $2.2 million during the second quarter of 2018, which was $1.0 million lower compared to the first quarter of 2018, and an increase of $0.5 million compared to the second quarter of 2017.  The linked quarter decrease in non-interest income was primarily the result of $1.4 million of gains during the first quarter of 2018 from the sale of securities that the Bank had retained from its Freddie Mac sponsored Q-deal securitization, offset by $0.4 million of increased loan fees during the second quarter of 2018.

Non-Interest Expense

Total non-interest expense was $20.8 million during the second quarter of 2018, $21.7 million during the first quarter of 2018, and $19.5 million during the second quarter of 2017. The year-over-year increase in non-interest expense was primarily the result of a $1.9 million increase in salaries and employee benefits.

The ratio of non-interest expense to average assets was 1.33% during the second quarter of 2018, lower than 1.36% during the first quarter of 2018, and higher than 1.27% during the second quarter of 2017.

The efficiency ratio was 54.4% during the second quarter of 2018, 54.6% during the first quarter of 2018, and higher than the 49.0% during the second quarter of 2017.

Income Tax Expense

The reported effective tax rate for the second quarter of 2018 increased slightly to 25.0% during the second quarter of 2018.

Credit Quality

Non-performing loans at June 30, 2018 were $1.6 million, or 0.03% of total loans, a decrease from $1.7 million, or 0.03% of total loans, at March 31, 2018.  The allowance for loan losses was 0.39% of total loans at both June 30, 2018, and March 31, 2018. At June 30, 2018, non-performing assets represented 1.1% of the sum of tangible common equity plus the allowance for loan losses and reserve for contingent liabilities (this non-Generally Accepted Accounting Principle (“GAAP”) statistic is otherwise known as the "Texas Ratio") (see “Problem Assets as a Percentage of Tangible Capital and Reserves” table and “Non-GAAP Reconciliation” table at the end of this news release), which is lower than the ratio of 2.7% at March 31, 2018.  A loan loss provision of $1.1 million was recorded during the second quarter of 2018, compared to a loan loss provision of $0.2 million during the first quarter of 2018, and a provision for loan losses of $1.0 million during the second quarter of 2017.  The provision during the second quarter of 2018 was primarily due to charge-offs on two relationships that were previously on non-accrual status and also growth in the overall C&I loan portfolio.

Capital Management

The Company’s consolidated Tier 1 capital to average assets (“leverage ratio”), which was 9.09% at June 30, 2018, was in excess of all applicable regulatory requirements.

The bank’s regulatory capital ratios continued to be in excess of all applicable regulatory requirements inclusive of conservation buffer amounts.  At June 30, 2018, the bank’s leverage ratio was 9.94%, while Tier 1 capital to risk-weighted assets and Total capital to risk-weighted assets ratios were 13.09% and 13.55%, respectively. Mr. Mahon commented, “Our capital levels are very strong and we expect that our business model transformation will result in the CRE concentration ratio, which was 714.6% at June 30, 2018 on a consolidated basis, continuing to trend down over time.”

Diluted earnings per common share of $0.33 exceeded the quarterly $0.14 cash dividend per share by 136% during the second quarter of 2018, equating to a 42.4% dividend payout ratio.

Book value per share was $16.37 and tangible book value per share (common equity less goodwill divided by number of shares outstanding) (see “Non-GAAP Reconciliation” tables at the end of this news release) was $14.89 at June 30, 2018.

Earnings Call Information

The Company will conduct a conference call at 5:30 p.m. (ET) on Thursday, July 26, 2018, during which President and Chief Executive Officer, Kenneth J. Mahon, will discuss the Company’s second quarter financial performance.  There will be a question and answer period after the CEO remarks. Dial-in information for the live call is 1-888-317-6016. Upon dialing in, request to be joined into Dime Community Bancshares, Inc. call with the conference operator.

The conference call will be simultaneously webcast (listen only), and archived for a period of one year, at https://services.choruscall.com/links/dcom180726.html. Dial-in information for the replay is 1-877-344-7529 using access code #10122039. Replay will be available July 26, 2018 (7:30 p.m.) through August 2, 2018 (11:59 p.m.).

ABOUT DIME COMMUNITY BANCSHARES, INC.

The Company had $6.25 billion in consolidated assets as of June 30, 2018. The bank was founded in 1864, is headquartered in Brooklyn, New York, and currently has twenty-nine branches located throughout Brooklyn, Queens, the Bronx, Nassau County and Suffolk County, New York. More information on the Company and the bank can be found on Dime's website at www.dime.com.

This news release contains a number of forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). These statements may be identified by use of words such as "anticipate," "believe," “continue,” "could," "estimate," "expect," "intend," “likely,” "may," "outlook," "plan," "potential," "predict," "project," "should," "will," "would" and similar terms and phrases, including references to assumptions.

Forward-looking statements are based upon various assumptions and analyses made by the Company in light of management's experience and its perception of historical trends, current conditions and expected future developments, as well as other factors it believes are appropriate under the circumstances. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors (many of which are beyond the Company's control) that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Accordingly, you should not place undue reliance on such statements. Factors that could affect our results include, without limitation, the following: the timing and occurrence or non-occurrence of events may be subject to circumstances beyond the Company’s control; there may be increases in competitive pressure among financial institutions or from non-financial institutions; changes in the interest rate environment may reduce interest margins; changes in deposit flows, loan demand or real estate values may adversely affect the business of the Company and/or the Bank; unanticipated or significant increases in loan losses; changes in accounting principles, policies or guidelines may cause the Company’s financial condition to be perceived differently; changes in corporate and/or individual income tax laws may adversely affect the Company's financial condition or results of operations; general economic conditions, either nationally or locally in some or all areas in which the Company conducts business, or conditions in the securities markets or the banking industry may be less favorable than the Company currently anticipates; legislation or regulatory changes may adversely affect the Company’s business; technological changes may be more difficult or expensive than the Company anticipates; there may be failures or breaches of information technology security systems; success or consummation of new business initiatives may be more difficult or expensive than the Company anticipates; or litigation or other matters before regulatory agencies, whether currently existing or commencing in the future, may delay the occurrence or non-occurrence of events longer than the Company anticipates.

Contact: Avinash Reddy
Senior Vice President – Corporate Development and Treasurer
718-782-6200 extension 5909

DIME COMMUNITY BANCSHARES,  INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollars in thousands except share amounts)
	June 30,			March 31,				December 31,
		2018			2018				2017
ASSETS:
Cash and due from banks	$150,992			$188,826				$169,455
Mortgage-backed securities available for sale		414,938			354,410				351,384
Marketable equity securities, at fair value		6,368			6,433				-
Investment securities available for sale		5,078			-				4,006
Trading securities		-			-				2,715
Real Estate Loans:
One-to-four family and cooperative/condominium apartment		60,159			62,596				63,095
Multifamily residential and residential mixed use (1)(2)		4,106,094			4,280,951				4,381,180
Commercial real estate		1,053,582			1,007,595				1,010,603
Acquisition, development, and construction ("ADC")		10,526			9,413				9,189
Total real estate loans		5,230,361			5,360,555				5,464,067
Commercial and industrial ("C&I")		172,522			145,818				136,671
Other loans		1,477			1,053				1,379
Allowance for loan losses		(20,984	)		(21,204	)			(21,033	)
Total loans, net		5,383,376			5,486,222				5,581,084
Premises and fixed assets, net		25,340			25,276				24,326
Loans held for sale		430			-				-
Federal Home Loan Bank of New York capital stock		53,874			52,514				59,696
Bank Owned Life Insurance ("BOLI")		109,977			109,257				108,545
Goodwill		55,638			55,638				55,638
Other assets		47,164			47,341				46,611
TOTAL ASSETS	$6,253,175			$6,325,917				$6,403,460
LIABILITIES AND STOCKHOLDERS' EQUITY:
Deposits:
Non-interest bearing checking	$356,626			$325,071				$307,746
Interest-bearing checking		121,060			124,527				124,283
Savings		349,790			357,152				362,092
Money Market		2,280,915			2,399,200				2,517,439
Sub-total		3,108,391			3,205,950				3,311,560
Certificates of deposit		1,251,002			1,224,491				1,091,887
Total Due to Depositors		4,359,393			4,430,441				4,403,447
Escrow and other deposits		89,302			131,953				82,168
Federal Home Loan Bank of New York advances		1,043,650			1,010,400				1,170,000
Subordinated Notes Payable, net		113,686			113,649				113,612
Other liabilities		31,612			31,517				35,666
TOTAL LIABILITIES		5,637,643			5,717,960				5,804,893
STOCKHOLDERS' EQUITY:
Common stock ($0.01 par, 125,000,000 shares authorized, 53,690,825 shares and 53,624,453 shares
issued at June 30, 2018 and December 31, 2017, respectively, and 37,591,261 shares and 37,419,070
shares outstanding at June 30, 2018 and December 31, 2017, respectively)		537			537				536
Additional paid-in capital		278,194			277,070				276,730
Retained earnings		551,818			544,762				535,130
Accumulated other comprehensive loss, net of deferred taxes		(4,578	)		(4,037	)			(3,641	)
Unearned Restricted Stock Award common stock		(4,821	)		(3,855	)			(2,894	)
Common stock held by the Benefit Maintenance Plan		(2,148	)		(2,196	)			(2,736	)
Treasury stock (16,099,564 shares and 16,205,383 shares at June 30, 2018 and December 31, 2017, respectively)		(203,470	)		(204,324	)			(204,558	)
TOTAL STOCKHOLDERS' EQUITY		615,532			607,957				598,567
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$6,253,175			$6,325,917				$6,403,460
(1) Includes loans underlying cooperatives.
(2) While the loans within this category are often considered "commercial real estate" in nature, multifamily and loans underlying cooperatives are here reported separately from commercial real estate loans in order to emphasize the residential nature of the collateral underlying this significant component of the total loan portfolio.

DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands except share and per share amounts)
	For the Three Months  Ended										For the Six Months Ended
	June 30,			March 31,				June 30,			June 30,			June 30,
	2018			2018				2017			2018			2017
Interest income:
Loans secured by real estate	$47,828			$49,575				$51,137			$97,403			$101,612
Commercial and industrial ("C&I")		2,156			1,656				474			3,812			515
Other loans		18			19				18			37			36
Mortgage-backed securities		2,406			2,257				14			4,663			28
Investment securities		49			15				164			64			354
Other short-term investments		1,547			1,511				611			3,058			1,328
Total interest  income		54,004			55,033				52,418			109,037			103,873
Interest expense:
Deposits and escrow		11,988			10,751				9,509			22,739			19,016
Borrowed funds		5,882			6,267				4,856			12,149			9,317
Total interest expense		17,870			17,018				14,365			34,888			28,333
Net interest income		36,134			38,015				38,053			74,149			75,540
Provision for loan losses		1,113			193				1,047			1,306			1,497
Net interest income after  provision
for loan losses		35,021			37,822				37,006			72,843			74,043
Non-interest income:
Service charges and other fees		1,299			911				919			2,210			1,713
Mortgage banking income, net		102			111				65			213			81
Gain (loss) on equity and trading securities		19			(4	)			59			15			134
Gain on sale of securities and other assets		-			1,370				-			1,370			-
Gain on sale of loans		35			90				-			125			-
Income from BOLI		720			712				551			1,432			1,096
Other		62			54				153			116			501
Total non-interest income		2,237			3,244				1,747			5,481			3,525
Non-interest expense:
Salaries and employee benefits		10,884			11,177				8,960			22,061			18,984
Stock benefit plan compensation expense		407			388				381			795			677
Occupancy and equipment		3,697			3,872				3,500			7,569			7,128
Data processing costs		1,797			1,754				1,503			3,551			3,110
Marketing		146			1,047				1,466			1,193			2,932
Federal deposit insurance premiums		474			665				712			1,139			1,367
Other		3,422			2,831				2,947			6,253			6,040
Total non-interest expense		20,827			21,734				19,469			42,561			40,238
Income before taxes		16,431			19,332				19,284			35,763			37,330
Income tax expense		4,110			4,587				7,295			8,697			14,184
Net Income	$12,321			$14,745				$11,989			$27,066			$23,146
Earnings per Share ("EPS"):
Basic	$ 0.33			$ 0.39				$ 0.32			$ 0.72			$ 0.62
Diluted	$ 0.33			$ 0.39				$ 0.32			$ 0.72			$ 0.61
Average common shares outstanding
for Diluted EPS		37,515,373			37,464,725				37,635,798			37,496,982			37,590,198

DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED SELECTED FINANCIAL HIGHLIGHTS
(Dollars in thousands except per share amounts)
	At or For the Three Months  Ended												At or For the Six Months  Ended
	June 30,				March 31,				June 30,				June 30,				June 30,
		2018				2018				2017				2018				2017
Per Share Data:
Reported EPS (Diluted)	$0.33				$0.39				$0.32				$0.72				$0.61
Cash dividends paid per share		0.14				0.14				0.14				0.28				0.28
Book value per share		16.37				16.22				15.41				16.37				15.41
Tangible book value per share (1)		14.89				14.73				13.93				14.89				13.93
Dividend payout ratio		42.42%				35.90%				43.75%				38.89%				45.90%
Performance Ratios (Based upon Reported Net Income):
Return on average assets		0.79%				0.93%				0.78%				0.86%				0.76%
Return on average common equity		8.06%				9.77%				8.32%				8.91%				8.08%
Return on average tangible common equity (1)		8.87%				10.76%				9.20%				9.81%				8.94%
Net interest spread		2.17%				2.28%				2.40%				2.23%				2.40%
Net interest margin		2.39%				2.47%				2.57%				2.43%				2.57%
Average interest-earning assets to average interest-bearing liabilities		117.93%				115.84%				117.18%				116.87%				116.77%
Non-interest expense to average assets		1.33%				1.36%				1.27%				1.35%				1.32%
Efficiency ratio		54.35%				54.60%				48.99%				54.48%				50.98%
Loan-to-deposit ratio at end of period		123.97%				124.31%				133.01%				123.97%				133.01%
Effective tax rate		25.01%				23.73%				37.83%				24.32%				38.00%
Average Balance Data:
Average assets	$6,265,128				$6,369,310				$6,128,378				$6,317,219				$6,077,646
Average interest-earning assets		6,047,600				6,145,013				5,918,173				6,096,307				5,871,241
Average loans		5,450,973				5,577,309				5,802,417				5,514,141				5,746,758
Average deposits		4,395,589				4,378,117				4,476,004				4,386,853				4,480,757
Average common equity		611,477				603,555				576,689				607,516				573,206
Average tangible common equity (1)		555,840				547,917				521,051				551,879				517,568
Asset Quality Summary:
Non-performing loans (excluding loans held for sale)	$1,554				$1,719				$3,374				$1,554				$3,374
Non-performing assets (2)		1,554				1,719				4,661				1,554			$4,661
Net charge-offs		1,333				22				16				1,355				48
Non-performing loans/ Total loans		0.03%				0.03%				0.06%				0.03%				0.06%
Non-performing assets/ Total assets		0.02%				0.03%				0.07%				0.02%				0.07%
Allowance for loan loss/ Total loans		0.39%				0.39%				0.37%				0.39%				0.37%
Allowance for loan loss/ Non-performing loans		1350.32%				1233.51%				651.60%				1350.32%				651.60%
Loans delinquent 30 to 89 days at period end	$745				$2,947				$1,872				$745				$1,872
Capital Ratios - Consolidated:
Tangible common equity to tangible assets (1)		9.03%				8.81%				8.46%				9.03%				8.46%
Tier 1 common equity ratio		11.96				11.87				10.78				11.96				10.78
Tier 1 risk-based capital ratio		11.96				11.87				12.17				11.96				12.17
Total risk-based capital ratio		14.85				14.79				14.96				14.85				14.96
Tier 1 leverage ratio		9.09				8.79				9.86				9.09				9.86
Capital Ratios - Bank Only:
Tier 1 common equity ratio		13.09%				12.97%				11.44%				13.09%				11.44%
Tier 1 risk-based capital ratio		13.09				12.97				11.44				13.09				11.44
Total risk-based capital ratio		13.55				13.43				11.88				13.55				11.88
Tier 1 leverage ratio		9.94				9.59				9.25				9.94				9.25
(1)  See "Non-GAAP Reconciliation" table for reconciliation of tangible common equity and tangible assets. Average balances are calculated using the ending balance for months during the period indicated.
(2)  Amount comprised of total non-accrual loans and the recorded balance of pooled bank trust preferred security investments that were deemed to meet the criteria of a non-performing asset, if applicable.

DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED AVERAGE BALANCES AND NET INTEREST INCOME
(Dollars in thousands)
	For the Three Months Ended
			June 30, 2018								March 31, 2018								June 30, 2017
						Average								Average								Average
	Average					Yield/			Average					Yield/			Average					Yield/
	Balance		Interest			Cost			Balance		Interest			Cost			Balance		Interest			Cost
Assets:
Interest-earning assets:
Real estate loans	$5,307,712		$47,828			3.60%			$5,435,400		$49,575			3.65%			$5,759,565		$51,137			3.55%
Commercial and industrial loans		142,224		2,156		6.06				140,720		1,656		4.71				41,776		474		4.54
Other loans		1,037		18		6.94				1,189		19		6.39				1,076		18		6.69
Mortgage-backed securities		389,373		2,406		2.47				351,196		2,257		2.57				3,460		14		1.62
Investment securities		10,243		49		1.91				6,492		15		0.92				16,970		164		3.87
Other short-term investments		197,011		1,547		3.14				210,016		1,511		2.88				95,326		611		2.56
Total interest-earning assets		6,047,600		54,004		3.57%				6,145,013		55,033		3.58%				5,918,173	$52,418			3.54%
Non-interest-earning assets		217,528								224,297								210,205
Total assets	$6,265,128								$6,369,310								$6,128,378
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Interest-bearing checking accounts	$126,507		$57			0.18%			$124,440		$54			0.18%			$114,257		$65			0.23%
Money market accounts		2,351,935		6,893		1.18				2,432,242		6,318		1.05				2,767,455		6,139		0.89
Savings accounts		354,441		55		0.06				359,638		59		0.07				367,995		46		0.05
Certificates of deposit		1,226,812		4,983		1.63				1,151,146		4,320		1.52				925,535		3,259		1.41
Total interest-bearing deposits		4,059,695		11,988		1.18				4,067,466		10,751		1.07				4,175,242		9,509		0.91
Borrowed Funds		1,068,583		5,882		2.21				1,237,094		6,267		2.05				875,057		4,856		2.23
Total interest-bearing liabilities		5,128,278		17,870		1.40%				5,304,560		17,018		1.30%				5,050,299	$14,365			1.14%
Non-interest-bearing checking accounts		335,894								310,651								300,762
Other non-interest-bearing liabilities		189,479								150,544								200,628
Total liabilities		5,653,651								5,765,755								5,551,689
Stockholders' equity		611,477								603,555								576,689
Total liabilities and stockholders' equity	$6,265,128								$6,369,310								$6,128,378
Net interest income			$36,134								$38,015								$38,053
Net interest spread						2.17%								2.28%								2.40%
Net interest-earning assets	$919,322								$840,453								$867,874
Net interest margin						2.39%								2.47%								2.57%
Ratio of interest-earning assets to interest-bearing liabilities				117.93%								115.84%								117.18%
Deposits (including non-interest bearing checking accounts)	$4,395,589		$11,988			1.09%			$4,378,117		$10,751			1.00%			$4,476,004		$9,509			0.85%

DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED SCHEDULE OF LOAN COMPOSITION AND WEIGHTED AVERAGE RATES ("WAR") (1)
(Dollars in thousands)
	At June 30, 2018					At March 31, 2018					At December 31, 2017
	Balance		WAR			Balance		WAR			Balance		WAR
Loan balances at period end:
One-to-four family residential, including condominium and cooperative apartment	$60,159		4.42%			$62,596		4.36%			$63,095		4.33%
Multifamily residential and residential mixed use (2)(3)		4,106,094	3.49				4,280,951	3.42				4,381,180	3.40
Commercial and commercial mixed use real estate		1,053,582	3.85				1,007,595	3.95				1,010,603	3.95
Acquisition, development, and construction ("ADC")		10,526	6.02				9,413	5.84				9,189	5.59
Total real estate loans		5,230,361	3.61				5,360,555	3.53				5,464,067	3.51
Commercial and industrial ("C&I")		172,522	5.30%				145,818	4.99%			$136,671		4.82%
(1) Weighted average rate is calculated by aggregating interest based on the current loan rate from each loan in the category, divided by the total amount of loans in the category.
(2) Includes loans underlying cooperatives.
(3) While the loans within this category are often considered "commercial real estate" in nature, multifamily and loans underlying cooperatives are here reported separately from commercial real estate loans in order to emphasize the residential nature of the collateral underlying this significant  component of the total loan portfolio.

DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED SCHEDULE OF NON-PERFORMING ASSETS AND TROUBLED DEBT RESTRUCTURINGS ("TDRs")
(Dollars in thousands)
	At June 30,				At March 31,				At December 31,
		2018				2018				2017
Non-Performing Loans
One-to-four family residential, including condominium and cooperative apartment	$306				$449				$436
Commercial real estate		1,158				-				93
Commercial mixed use real estate (2)		89				90				-
C&I		-				1,179				-
Other		1				1				4
Total Non-Performing Loans (3)	$ 1,554				$ 1,719				$ 533
Total Non-Performing Assets	$ 1,554				$ 1,719				$ 533
Performing Loans
One- to four-family and cooperative/condominium apartment	$18				$20				$22
Multifamily residential and mixed use residential real estate (1)(2)		597				604				619
Mixed use commercial real estate (2)		4,130				4,152				4,174
Commercial real estate		-				3,279				3,296
Total Performing TDRs	$ 4,745				$ 8,055				$ 8,111
(1) Includes loans underlying cooperatives.
(2) While the loans within this category are often considered "commercial real estate" in nature, multifamily and loans underlying cooperatives are here reported separately from commercial real estate loans in order to emphasize the residential nature of the collateral underlying this significant  component of the total loan portfolio.
(3) There were no non-accruing TDRs for the periods indicated.
PROBLEM ASSETS AS A PERCENTAGE OF TANGIBLE CAPITAL AND RESERVES (TEXAS RATIO)
(Dollars in thousands)
	At June 30,				At March 31,				At December 31,
		2018				2018				2017
Total Non-Performing Assets	$1,554				$1,719				$533
Loans 90 days or more past due on accrual status (5)		4,873				13,816				19,935
TOTAL PROBLEM ASSETS	$6,427				$15,535				$20,468
Tangible common equity  (6)	$559,894				$552,319				$542,929
Allowance for loan losses and reserves for contingent liabilities		21,009				21,229				21,058
TANGIBLE COMMON EQUITY PLUS RESERVES	$580,903				$573,548				$608,680
TEXAS RATIO (PROBLEM ASSETS AS A PERCENTAGE OF
TANGIBLE COMMON EQUITY AND RESERVES)		1.1%				2.7%				3.4%
(5) These loans were, as of the respective dates indicated, expected to be either satisfied, made current or re-financed within the following twelve months, and were not expected to result in any loss of contractual principal or interest.  These loans are not included in non-performing loans.
(6)  See "Non-GAAP Reconciliation" table for reconciliation of tangible common equity and tangible assets.

DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
NON-GAAP RECONCILIATION
(Dollars in thousands except per share amounts)
	For the Three Months  Ended												For the Six Months  Ended
	June 30,				March 31,				June 30,				June 30,				June 30,
		2018				2018				2017				2018				2017
Reconciliation of Reported and Adjusted ("non-GAAP") Net Income:
Reported net income	$	12,321			$	14,745			$	11,989			$	27,066			$	23,146
Adjustments to Net Income (1):										-				-				-
Less: Gain on sale of securities		-				(930	)			-				(930	)			-
Tax adjustment		-				(92	)			-				(92	)			-
Adjusted ("non-GAAP") net income	$	12,321			$	13,723			$	11,989			$	26,044			$	23,146
Adjusted Ratios (Based upon "non-GAAP Net Income" as calculated above):
Adjusted EPS (Diluted)	$	0.33			$	0.36			$	0.32			$	0.69			$	0.61
Adjusted return on average assets		0.79%				0.86%				0.78%				0.82%				0.76%
Adjusted return on average common equity		8.06%				9.09%				8.32%				8.57%				8.08%
Adjusted return on average tangible common equity		8.87%				10.02%				9.20%				9.44%				8.94%
	June 30,				March 31,				December 31,
		2018				2018				2017
Reconciliation of Tangible Assets:
Total assets	$	6,253,175			$	6,325,917			$	6,403,460
Less:
Goodwill		55,638				55,638				55,638
Tangible assets	$	6,197,537			$	6,270,279			$	6,347,822
Reconciliation of Tangible Common Equity - Consolidated:
Total common equity	$	615,532			$	607,957			$	598,567
Less:
Goodwill		55,638				55,638				55,638
Tangible common equity	$	559,894			$	552,319			$	542,929
(1)  Adjustments to net income are taxed at the company's statutory tax rate of approximately 32% for 2018 and 45% for 2017, unless otherwise noted.