There were 1,462 press releases posted in the last 24 hours and 398,763 in the last 365 days.

Flushing Financial Corporation Reports 4Q20 GAAP EPS of $0.11 and 2020 GAAP EPS of $1.18 4Q20 Core EPS of $0.58 and 2020 Core EPS of $1.70 Third Consecutive Quarter of Record Net Interest Income

FOURTH QUARTER 2020 HIGHLIGHTS1

  • GAAP diluted EPS of $0.11, compared to $0.50 in 3Q20 and $0.45 in 4Q19
  • Core diluted EPS of $0.58 compared to $0.56 in 3Q20 and $0.41 in 4Q19
  • GAAP ROAA and ROAE were 0.18% and 2.27% in 4Q20 compared to 0.73% and 9.11% in 4Q19, respectively
  • Core ROAA and ROAE were 0.92% and 11.67% in 4Q20 compared to 0.67% and 8.36% in 4Q19, respectively
  • Record net interest income of $55.7 million, up 11.6% QoQ and 35.3% YoY, while core net interest income was $54.7, up 10.1% QoQ and 36.3% YoY
  • Net interest margin of 3.08%, up 8 bps QoQ and 60 bps YoY and core net interest margin of 2.97%, up 8 bps QoQ and 64 bps YoY
  • Average loans were $6.4 billion, up 8.0% QoQ and 11.3% YoY while average deposits of $4.7 billion improved 8.2% QoQ and 4.0% YoY
  • Loan pipeline remained strong at $354.6 million, up 9.3% from $324.5 million a year ago
  • Provision for credit losses (excluding Day 1 impact from Empire Bancorp transaction) of $2.0 million exceed net charge-offs of $0.6 million in 4Q20
  • NPAs of $21.1 million were down 15.0% from $24.8 million in 3Q20
  • Loans in forbearance declined 56.9% in 4Q20 and were 5.4% of total loans and only 3.2% of loans excluding interest only forbearance loans

UNIONDALE, N.Y., Jan. 28, 2021 (GLOBE NEWSWIRE) -- Flushing Financial Corporation (the “Company”) (NASDAQ-GS: FFIC) the parent holding company for Flushing Bank (the “Bank”), today announced its financial results for the fourth quarter and full year ended December 31, 2020.

John R. Buran, President and Chief Executive Officer stated, “While 2020 was an unprecedented year in many ways, I am proud of how our employees continued to serve customers and help communities throughout the COVID-19 pandemic. It is through their efforts that our Company was able to persevere and post strong results. We achieved three consecutive quarters of record net interest income. We reduced loans in forbearance by 76% from their peak. We closed the Empire acquisition this quarter and within three weeks completed the conversion of all customers onto our systems. As we enter 2021 we are a stronger more resilient Company with greater scale, a better margin and improved mobile and lending capabilities through enhanced fintech relationships.”

Mr. Buran continued, “Our core NIM improvement of 8 bps during the quarter was driven by reducing cost of funds by 12 bps with a minimal decrease in the yield on interest-earning assets. While we see additional opportunities to reduce our cost of deposits with $342 million of CDs maturing in 1Q21 with a weighted average rate of 1.23% compared to a current one year CD rate of 0.55%, pricing on new loans has shifted lower. Loan growth rebounded this quarter, rising 4% year over year and 5% (annualized) from third quarter, excluding the Empire transaction. We reported fourth quarter GAAP EPS of $0.11, which included various charges from the Empire transaction, our previously announced balance sheet restructuring, and other adjustments totaling $0.47 per share. Adjusting for these items, core fourth quarter EPS was $0.58, up 42% year over year. The Empire integration is proceeding consistent with our expectations and we are on track to achieve our 20% earnings accretion target for 2021.”

“We continue to actively monitor our credit portfolio and work with our customers during these difficult times. We remain comfortable with our credit exposure given the loan to value of 38% on our real estate dependent loans and the fact that 41% of our loans on forbearance have already begun to pay interest and escrow. Loans in forbearance fell 57% to $364 million in the fourth quarter from $846 million in 3Q20 and the loans that exited forbearance are performing in line with expectations. Criticized and classified assets rose $29 million as the Empire acquisition added $15 million. We continue to actively monitor our portfolio and work with customers during these difficult times. Flushing Bank has a history of superior credit quality through many cycles and losses have never been more than 64 bps. We do not see a reason why this would change in this economic cycle.”

“We are an active participant in the second offering of the PPP program through our continued partnership with a fintech company. From January 19th through January 22, 2021, we processed 434 applications totaling $115 million. We remain committed to helping our customers in this difficult period.”

Mr. Buran concluded, “While 2020 was a challenging year for our customers, communities and employees, it also was a significant period for the Company as we upgraded our mobile banking capabilities in March, closed the Empire transaction on October 31st, and completed the systems conversion while adopting to a new work environment. I am pleased with how we performed on our strategic objectives and look forward to 2021.”

Summary of Strategic Objectives

  • Manage cost of funds and continue to improve funding mix
  • Resume historical loan growth while achieving appropriate risk adjusted returns
  • Enhance core earnings power by improving scalability and efficiency
  • Manage credit risk
  • Remain well capitalized

Earnings Summary:

Net Interest Income

Net interest income for 4Q20 was $55.7 million, an increase 35.3% YoY and 11.6% QoQ (Empire contributed $4.2 million to growth).

  • Net interest margin of 3.08%, increased 60 bps YoY and 8 bps QoQ
    • Net purchase accounting accretion was not meaningful in 4Q20 and is expected to add less than $1 million to net interest income in 1Q21
  • Yield on average interest-earning assets of 3.82%, decreased 39 bps YoY, and 2 bps QoQ
  • Cost of average interest-bearing liabilities of 0.86%, decreased 110 bps YoY and 12 bps QoQ, driven primarily by the decline in the costs of deposits to 0.47% in 4Q20, down 124 bps YoY and 10 bps QoQ
  • Average interest-earning assets of $7.2 billion, increased 8.5% in both YoY and QoQ largely from Empire
  • Prepayment penalty income from loans and securities, net recoveries of interest from non-accrual loans, net gains (losses) from fair value adjustments on qualifying hedges, and purchase accounting accretion totaled $2.1 million (11 bps) in 4Q20, $1.7 million (11 bps) in 3Q20 and $2.4 million (15 bps) in 4Q19. Excluding these items, the net interest margin was 2.97% in 4Q20, an increase of 64 bps YoY and 8 bps QoQ

Provision for Credit Losses

The Company recorded a provision for credit losses of $3.9 million in 4Q20, compared to $2.5 million in 3Q20 and $(0.3) million in 4Q19.

  • 4Q20 provision for credit losses was driven by $1.8 million of Day 1 impact of the Empire transaction ($0.05 per share, net of tax) in addition to required provision of $2.0 million resulting from the economic environment
  • Net charge-offs of $0.6 million in 4Q20 and $0.8 million in 3Q20 were significantly below quarterly provisions for credit losses

Non-interest Income

Non-interest income for 4Q20 was $(1.2) million compared to $1.4 million in 3Q20 and $5.0 million in 4Q19.

  • Non-interest income included net gains (losses) from fair value adjustments of $(4.1) million ($(0.11) per share, net of tax) in 4Q20, $(2.2) million ($(0.06) per share, net of tax) in 3Q20 and $0.8 million ($0.02 per share, net of tax) in 4Q19, respectively
  • Losses on the sale of investment securities with a par value of $89.5 million were $0.6 million ($0.02 per share, net of tax) in 4Q20
  • Life insurance proceeds were $419,000 ($0.01 per share) in 4Q19
  • Absent all above items, non-interest income was $3.6 million in 4Q20, down 6.7% YoY and flat QoQ

Non-interest Expense

Non-interest expense for 4Q20 was $46.8 million, compared to $30.0 million in 3Q20 and $29.6 million in 4Q19.

  • 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 non-interest expense includes $0.4 million of merger charges ($0.01 per share, net of tax) while 4Q19 includes $1.1 million of merger charges ($0.03 per share, net of tax)
  • Excluding the above items, core operating expenses were $33.5 million, up 17.4% YoY and 13.4% QoQ; Empire contributed $1.7 million
  • The ratio of core operating expense to average assets was 1.74% in 4Q20, 1.67% in 3Q20 and 1.62% in 4Q19
  • Excluding the notable items in net interest income, non-interest income and non-interest expense, the adjusted efficiency ratio was 57.6% in 4Q20 compared to 55.4% in 3Q20 and 65.0% in 4Q19

Provision for Income Taxes

The provision for income taxes was $0.4 million in 4Q20, versus $4.5 million in 3Q20 and $4.0 million in 4Q19.

  • Pre-tax income declined to $3.9 million in 4Q20 compared to $18.8 million in 3Q20 and $16.9 million in 4Q19
  • The effective tax rates were 10.8% in 4Q20, 23.9% in 3Q20, and 23.4% in 4Q19

Financial Condition Summary:

Loans:

  • Net loans held for investment were $6.7 billion reflecting an increase of 15.8% (3.9% excluding Empire) from December 31, 2019, as we continue to focus on the origination of full banking relationship loans through C&I loans, multi-family loans and commercial real estate
  • SBA Paycheck Protection Program (“PPP”) loans were $151.9 million in 4Q20 compared to $111.6 million in 3Q20, with the increase largely due to Empire
  • Loan closings of commercial business loans, multi-family loans and commercial real estate totaled $290.5 million for 4Q20, or 91.9% of loan production
  • Loan pipeline was $354.6 million at December 31, 2020, compared to $324.5 million a year ago

The following table shows the weighted average rate received from loan closings for the periods indicated:

               
    For the three months ended  
       December 31,       September 30,      December 31,   
Loan type   2020   2020   2019  
Mortgage loans   3.47 %   3.56 %   3.97 %
Non-mortgage loans   3.37 %   2.81 %   4.68 %
Total loans   3.41 %   3.16 %   4.19 %
               
Excluding PPP loans   3.41 %   3.45 %   4.19 %

Credit Quality:

  • Non-performing loans totaled $21.1 million, an increase of $7.8 million ($0.6 million from Empire), or 58.9%, from $13.3 million at December 31, 2019, but down $3.7 million QoQ
  • Non-performing assets totaled $21.1 million, an increase of $7.6 million ($0.6 million from Empire), or 56.0%, from $13.5 million at December 31, 2019, but down $3.7 million QoQ
  • Criticized and classified assets totaled $71.6 million compared to $38.0 million at December 31, 2019; increase in criticized and classified assets was largely due to $14.6 million from Empire and $7.7 million from one CRE relationship
  • Loans classified as troubled debt restructured (TDR) totaled $15.7 million versus $6.5 million at December 31, 2019 primarily driven by one hotel loan
  • Active COVID-19 forbearances at December 31, 2020 totaled 134 loans with a principal balance of $364.4 million at the time of modification, a decrease from the peak of $1.5 billion; total deferment of $23.6 million in principal, interest and escrow; of the total forbearance loans, approximately 40% are making interest payments
  • Over 86% of gross loans are collateralized by real estate
  • The loan-to-value ratio on portfolio of real estate dependent loans as of December 31, 2020 totaled 38.0%
  • Allowance for credit losses were 0.67% of loans in 4Q20 compared to 0.38% a year ago; Empire had a minimal impact on this ratio

Capital Management:

  • Book value per common share was $20.11 at December 31, 2020, compared to $20.59 at December 31, 2019 and tangible book value per common share, a non-GAAP measure, was $19.45 at December 31, 2020, compared to $20.02 at December 31, 2019
  • The Company paid a dividend of $0.21 per share in 4Q20 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 7.52% in 4Q20 compared to 8.05% a year ago
  • The Company and the Bank remain well capitalized under all applicable regulatory requirements
  • The leverage ratio was 8.38% in 4Q20 versus 8.73% in 4Q19

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 on Friday, January 29, 2021 at 9:30 AM (ET) to discuss the Company’s strategy and results for the fourth quarter
  • Dial-in for Live Call: 1-877-509-5836
  • Webcast: https://services.choruscall.com/links/ffic210129.html
  • Dial-in for Replay: 1-877-344-7529
  • Replay Access Code: 10150602
  • The conference call will be simultaneously webcast and archived through January 29, 2022

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.

“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, 2019 and in other documents filed by the Company with the Securities and Exchange Commission from time to time, as well as the possibility that the proposed expected benefits of the Empire merger may not materialize in the timeframe expected or at all, or may be more costly to achieve. These proposed risks, as well as other risks associated with the transaction, are more fully discussed in the proxy statement/prospectus that is included in the registration statement on Form S-4 filed with the SEC in connection with the transaction, as amended and supplemented 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 -

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share data)
(Unaudited)

                               
    For the three months ended   For the year ended
       December 31,       September 30,      December 31,       December 31,       December 31, 
    2020   2020   2019   2020   2019
Interest and Dividend Income                                   
Interest and fees on loans   $ 66,120     $ 60,367     $ 64,316     $ 248,153     $ 251,744  
Interest and dividends on securities:                                
Interest     2,813       3,525       5,528       15,776       25,535  
Dividends     8       9       17       43       73  
Other interest income     30       13       318       355       1,604  
Total interest and dividend income     68,971       63,914       70,179       264,327       278,956  
                               
Interest Expense                                   
Deposits     6,470       7,093       21,517       42,312       88,057  
Other interest expense     6,769       6,897       7,483       26,816       28,959  
Total interest expense     13,239       13,990       29,000       69,128       117,016  
                               
Net Interest Income     55,732       49,924       41,179       195,199       161,940  
Provision for credit losses     3,862       2,470       (318 )     23,129       2,811  
Net Interest Income After Provision for Credit Losses     51,870       47,454       41,497       172,070       159,129  
                               
Non-interest Income                                   
Banking services fee income     1,442       1,316       844       4,500       3,723  
Net loss on sale of securities     (610 )                 (701 )     (15 )
Net gain on sale of loans     6             489       48       870  
Net gain on sale of assets                             770  
Net gain (loss) from fair value adjustments     (4,129 )     (2,225 )     807       (2,142 )     (5,353 )
Federal Home Loan Bank of New York stock dividends     734       874       1,026       3,453       3,589  
Life insurance proceeds                 419       659       462  
Bank owned life insurance     1,016       923       984       3,814       3,534  
Other income     360       463       469       1,412       1,891  
Total non-interest income (loss)     (1,181 )     1,351       5,038       11,043       9,471  
                               
Non-interest Expense                                   
Salaries and employee benefits     22,089       17,335       17,470       74,228       67,765  
Occupancy and equipment     3,446       3,021       2,950       12,134       11,328  
Professional services     2,463       2,064       2,120       9,374       8,358  
FDIC deposit insurance     562       727       306       2,676       869  
Data processing     3,411       1,668       1,476       8,586       5,878  
Depreciation and amortization     1,579       1,542       1,476       6,212       5,930  
Other real estate owned/foreclosure expense     95       240       59       216       204  
Net loss from sales of real estate owned           5             36        
Prepayment Penalty on Borrowings     7,834                   7,834        
Other operating expenses     5,332       3,383       3,790       16,635       14,937  
Total non-interest expense     46,811       29,985       29,647       137,931       115,269  
                               
Income Before Income Taxes     3,878       18,820       16,888       45,182       53,331  
                               
Provision for Income Taxes                                   
Federal     533       3,359       3,058       9,188       10,439  
State and local     (116 )     1,130       899       1,320       1,613  
Total taxes     417       4,489       3,957       10,508       12,052  
                               
Net Income   $ 3,461     $ 14,331     $ 12,931     $ 34,674     $ 41,279  
                               
                               
Basic earnings per common share   $ 0.11     $ 0.50     $ 0.45     $ 1.18     $ 1.44  
Diluted earnings per common share   $ 0.11     $ 0.50     $ 0.45     $ 1.18     $ 1.44  
Dividends per common share   $ 0.21     $ 0.21     $ 0.21     $ 0.84     $ 0.84  


FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollars in thousands, except per share data)
(Unaudited)

                   
       December 31,       September 30,      December 31, 
    2020   2020   2019
ASSETS                     
Cash and due from banks   $ 157,388     $ 75,560     $ 49,787  
Securities held-to-maturity:                   
Mortgage-backed securities     7,914       7,919       7,934  
Other securities     49,918       50,252       50,954  
Securities available for sale:                  
Mortgage-backed securities     404,460       386,235       523,849  
Other securities     243,514       234,721       248,651  
Loans:                  
Multi-family residential     2,533,952       2,252,757       2,238,591  
Commercial real estate     1,754,754       1,636,659       1,582,008  
One-to-four family ― mixed-use property     602,981       585,159       592,471  
One-to-four family ― residential     245,211       191,011       188,216  
Co-operative apartments     8,051       8,132       8,663  
Construction     83,322       63,567       67,754  
Small Business Administration     167,376       124,649       14,445  
Taxi medallion     2,757       2,317       3,309  
Commercial business and other     1,303,225       1,063,429       1,061,478  
Net unamortized premiums and unearned loan fees     3,045       13,718       15,271  
Allowance for loan losses     (45,153 )     (38,343 )     (21,751 )
Net loans     6,659,521       5,903,055       5,750,455  
Interest and dividends receivable     44,041       36,068       25,722  
Bank premises and equipment, net     28,179       25,766       28,676  
Federal Home Loan Bank of New York stock     43,439       57,119       56,921  
Bank owned life insurance     181,710       158,701       157,713  
Goodwill     17,636       16,127       16,127  
Other real estate owned, net                 239  
Core deposit intangibles     3,172              
Right of use asset     50,743       42,326       41,254  
Other assets     84,759       69,207       59,494  
Total assets   $ 7,976,394     $ 7,063,056     $ 7,017,776  
                   
LIABILITIES                     
Due to depositors:                     
Non-interest bearing   $ 778,672     $ 607,954     $ 435,072  
Certificate of deposit accounts     1,138,361       1,051,644       1,437,890  
Savings accounts     168,183       160,294       191,485  
Money market accounts     1,682,345       1,381,552       1,592,011  
NOW accounts     2,323,172       1,704,915       1,365,591  
Total deposits     6,090,733       4,906,359       5,022,049  
Mortgagors' escrow deposits     45,622       57,136       44,375  
Borrowed funds     1,020,895       1,323,975       1,237,231  
Operating lease liability     59,100       49,737       49,367  
Other liabilities     141,047       139,443       85,082  
Total liabilities     7,357,397       6,476,650       6,438,104  
                   
STOCKHOLDERS' EQUITY                     
Preferred stock (5,000,000 shares authorized; none issued)                  
Common stock ($0.01 par value; 100,000,000 shares authorized; 34,087,623 shares issued at December 31, 2020, and 31,530,595 shares issued each at September 30, 2020 and December 31, 2019; 30,775,854 shares, 28,218,427 shares and 28,157,206 shares outstanding at December 31, 2020, September 30, 2020 and December 31, 2019, respectively)     341       315       315  
Additional paid-in capital     261,533       227,877       226,691  
Treasury stock (3,311,769 shares, 3,312,168 shares and 3,373,389 shares at December 31, 2020, September 30, 2020 and December 31, 2019, respectively)     (69,400 )     (69,409 )     (71,487 )
Retained earnings     442,789       445,931       433,960  
Accumulated other comprehensive loss, net of taxes     (16,266 )     (18,308 )     (9,807 )
Total stockholders' equity     618,997       586,406       579,672  
                   
Total liabilities and stockholders' equity   $ 7,976,394     $ 7,063,056     $ 7,017,776  


FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
SELECTED CONSOLIDATED FINANCIAL DATA
(Dollars in thousands, except per share data)
(Unaudited)

                                 
    At or for the three months ended   At or for the year ended  
    December 31,    September 30,   December 31,    December 31,    December 31,   
       2020   2020      2019      2020      2019     
Per Share Data                                     
Basic earnings per share   $ 0.11   $ 0.50   $ 0.45   $ 1.18   $ 1.44  
Diluted earnings per share   $ 0.11   $ 0.50   $ 0.45   $ 1.18   $ 1.44  
Average number of shares outstanding for:                                  
Basic earnings per common share computation     30,602,974     28,873,606     28,723,077     29,301,495     28,709,106  
Diluted earnings per common share computation     30,602,974     28,873,606     28,723,077     29,301,495     28,709,109  
Shares outstanding     30,775,854     28,218,427     28,157,206     30,775,854     28,157,206  
Book value per common share (1)   $ 20.11   $ 20.78   $ 20.59   $ 20.11   $ 20.59  
Tangible book value per common share (2)   $ 19.45   $ 20.22   $ 20.02   $ 19.45   $ 20.02  
                                 
Stockholders' Equity                                    
Stockholders' equity   $ 618,997   $ 586,406   $ 579,672   $ 618,997   $ 579,672  
Tangible stockholders' equity     598,476     570,571     563,837     598,476     563,837  
                                 
Average Balances                                 
Total loans, net   $ 6,375,516   $ 5,904,051   $ 5,726,635   $ 6,005,947   $ 5,621,033  
Total interest-earning assets     7,243,472     6,675,896     6,677,325     6,862,798     6,582,473  
Total assets     7,705,407     7,083,028     7,057,094     7,276,022     6,947,881  
Total due to depositors     4,708,760     4,353,560     4,527,645     4,509,206     4,535,292  
Total interest-bearing liabilities     6,169,574     5,731,899     5,912,284     5,941,594     5,856,953  
Stockholders' equity     609,463     576,512     567,461     580,067     561,289  
                                 
Performance Ratios (3)                                 
Return on average assets     0.18 %     0.81 %     0.73 %     0.48 %     0.59 %
Return on average equity     2.27     9.94     9.11     5.98     7.35  
Yield on average interest-earning assets (4)     3.82     3.84     4.21     3.86     4.25  
Cost of average interest-bearing liabilities     0.86     0.98     1.96     1.16     2.00  
Cost of funds     0.77     0.89     1.83     1.06     1.87  
Net interest rate spread during period (4)     2.96     2.86     2.25     2.70     2.25  
Net interest margin (4)     3.08     3.00     2.48     2.85     2.47  
Non-interest expense to average assets     2.43     1.69     1.68     1.90     1.66  
Efficiency ratio (5)     57.56     55.37     65.00     58.69     63.89  
Average interest-earning assets to average interest-bearing liabilities     1.17 X   1.16 X   1.12 X   1.16 X   1.13 X



(1) Calculated by dividing stockholders’ equity by shares outstanding.
(2) 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”.
(3) Ratios are presented on an annualized basis, where appropriate.
(4) Yields are calculated on the tax equivalent basis using the statutory federal income tax rate of 21% for the periods presented.
(5) Efficiency ratio, a non-GAAP measure, was calculated by dividing non-interest expense (excluding accelerated employee benefits upon officer’s death, merger expense, OREO expense, prepayment penalty on borrowings and the net gain/loss from the sale of OREO) by the total of net interest income (excluding net gains and losses from fair value adjustments on qualifying hedges) and non-interest income (excluding life insurance proceeds, net gains and losses from the sale of securities and fair value adjustments). Additionally, it excludes purchase accounting adjustments.


FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
SELECTED CONSOLIDATED FINANCIAL DATA
(Dollars in thousands)
(Unaudited)

               
    At or for the year   At or for the year  
    ended   ended  
    December 31, 2020      December 31, 2019     
               
Selected Financial Ratios and Other Data                
               
Regulatory capital ratios (for Flushing Financial Corporation):                
Tier 1 capital   $ 662,987   $ 615,500  
Common equity Tier 1 capital     621,247     572,651  
Total risk-based capital     794,034     712,251  
               
Tier 1 leverage capital (well capitalized = 5%)     8.38 %     8.73 %  
Common equity Tier 1 risk-based capital (well capitalized = 6.5%)     9.87     10.95  
Tier 1 risk-based capital (well capitalized = 8.0%)     10.54     11.77  
Total risk-based capital (well capitalized = 10.0%)     12.62     13.62  
               
Regulatory capital ratios (for Flushing Bank only):                
Tier 1 capital   $ 733,010   $ 680,749  
Common equity Tier 1 capital     733,010     680,749  
Total risk-based capital     773,807     702,500  
               
Tier 1 leverage capital (well capitalized = 5%)     9.27 %     9.65 %  
Common equity Tier 1 risk-based capital (well capitalized = 6.5%)     11.64     13.02  
Tier 1 risk-based capital (well capitalized = 8.0%)     11.64     13.02  
Total risk-based capital (well capitalized = 10.0%)     12.29     13.43  
               
Capital ratios:                
Average equity to average assets     7.97 %     8.08 %  
Equity to total assets     7.76     8.26  
Tangible common equity to tangible assets (1)     7.52     8.05  
               
Asset quality:                
Non-accrual loans (2)   $ 18,325   $ 12,813  
Non-performing loans     21,073     13,258  
Non-performing assets     21,108     13,532  
Net charge-offs     3,639     2,005  
               
Asset quality ratios:                
Non-performing loans to gross loans     0.31 %     0.23 %  
Non-performing assets to total assets     0.26     0.19  
Allowance for loan losses to gross loans     0.67     0.38  
Allowance for loan losses to non-performing assets     213.91     160.73  
Allowance for loan losses to non-performing loans     214.27     164.05  
               
Full-service customer facilities     25     20  



(1) See “Calculation of Tangible Stockholders’ Common Equity to Tangible Assets”.
(2) Excludes performing non-accrual TDR loans.


FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
NET INTEREST MARGIN
(Dollars in thousands)
(Unaudited)

                                                   
    For the three months ended  
    December 31, 2020   September 30, 2020   December 31, 2019  
    Average         Yield/   Average         Yield/   Average         Yield/  
       Balance      Interest      Cost      Balance      Interest      Cost      Balance      Interest      Cost  
                                                   
       
Interest-earning Assets:                                                           
Mortgage loans, net   $ 5,010,097   $ 53,777   4.29 %   $ 4,721,742   $ 49,814     4.22   %   $ 4,628,854   $ 51,927   4.49 %
Other loans, net     1,365,419     12,343   3.62     1,182,309     10,553     3.57       1,097,781     12,389   4.51  
Total loans, net (1) (2)     6,375,516     66,120   4.15     5,904,051     60,367     4.09       5,726,635     64,316   4.49  
Taxable securities:                                                           
Mortgage-backed securities     413,875     1,435   1.39     413,902     1,928     1.86       555,023     3,230   2.33  
Other securities     266,663     957   1.44     243,754     1,166     1.91       244,075     1,774   2.91  
Total taxable securities     680,538     2,392   1.41     657,656     3,094     1.88       799,098     5,004   2.50  
Tax-exempt securities: (3)                                                           
Other securities     50,768     543   4.28     51,652     557     4.31       63,825     685   4.29  
Total tax-exempt securities     50,768     543   4.28     51,652     557     4.31       63,825     685   4.29  
Interest-earning deposits and federal funds sold     136,650     30   0.09     62,537     13     0.08       87,767     318   1.45  
Total interest-earning assets     7,243,472     69,085   3.82     6,675,896     64,031     3.84       6,677,325     70,323   4.21  
Other assets     461,935                 407,132                 379,769              
Total assets   $ 7,705,407               $ 7,083,028               $ 7,057,094              
                                                   
                                                   
Interest-bearing Liabilities:                                                           
Deposits:                                                           
Savings accounts   $ 163,382     75   0.18   $ 160,100     65     0.16     $ 192,818     325   0.67  
NOW accounts     1,924,840     1,320   0.27     1,625,109     1,242     0.31       1,362,151     5,227   1.53  
Money market accounts     1,507,245     2,010   0.53     1,461,996     2,108     0.58       1,456,676     7,165   1.97  
Certificate of deposit accounts     1,113,293     3,065   1.10     1,106,355     3,700     1.34       1,516,000     8,752   2.31  
Total due to depositors     4,708,760     6,470   0.55     4,353,560     7,115     0.65       4,527,645     21,469   1.90  
Mortgagors' escrow accounts     75,005           55,868     (22 )   (0.16 )     74,751     48   0.26  
Total interest-bearing deposits     4,783,765     6,470   0.54     4,409,428     7,093     0.64       4,602,396     21,517   1.87  
Borrowings     1,385,809     6,769   1.95     1,322,471     6,897     2.09       1,309,888     7,483   2.29  
Total interest-bearing liabilities     6,169,574     13,239   0.86     5,731,899     13,990     0.98       5,912,284     29,000   1.96  
Non interest-bearing demand deposits     731,170                 589,674                 435,241              
Other liabilities     195,200                 184,943                 142,108              
Total liabilities     7,095,944                 6,506,516                 6,489,633              
Equity     609,463                 576,512                 567,461              
Total liabilities and equity   $ 7,705,407               $ 7,083,028               $ 7,057,094              
                                                   
Net interest income / net interest rate spread (tax equivalent) (3)          $ 55,846   2.96 %          $ 50,041     2.86   %          $ 41,323   2.25 %  
                                                   
Net interest-earning assets / net interest margin (tax equivalent)   $ 1,073,898          3.08 %   $ 943,997          3.00   %   $ 765,041          2.48 %  
                                                   
Ratio of interest-earning assets to interest-bearing liabilities                 1.17 X               1.16   X               1.13 X



(1) Loan interest income includes loan fee income (which includes net amortization of deferred fees and costs, late charges, and prepayment penalties) of approximately $0.9 million, $0.8 million and $0.3 million for the three months ended December 31, 2020, September 30, 2020 and December 31, 2019, respectively.
(2) Loan interest income includes net gains from fair value adjustments on qualifying hedges of $1.0 million, $0.2 million and $1.0 million for the three months ended December 31, 2020, September 30, 2020 and December 31, 2019, respectively.
(3) Interest and yields are calculated on the tax equivalent basis using the statutory federal income tax rate of 21% for the periods presented totaling $0.1 million in each period. Additionally, net interest income includes purchase accounting adjustments from Empire transaction for the three months ended December 31, 2020.


FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
NET INTEREST MARGIN
(Dollars in thousands)
(Unaudited)

                                     
    For the year ended  
    December 31, 2020   December 31, 2019  
    Average       Yield/   Average       Yield/  
       Balance      Interest      Cost      Balance      Interest      Cost  
Interest-earning Assets:                                          
Mortgage loans, net   $ 4,798,232   $ 202,722     4.22 %   $ 4,609,439   $ 203,440   4.41 %
Other loans, net     1,207,715     45,431     3.76     1,011,594     48,304   4.78  
Total loans, net (1) (2)     6,005,947     248,153     4.13     5,621,033     251,744   4.48  
Taxable securities:                                         
Mortgage-backed securities     450,065     8,730     1.94     572,223     15,468   2.70  
Other securities     249,533     5,178     2.08     243,324     8,102   3.33  
Total taxable securities     699,598     13,908     1.99     815,547     23,570   2.89  
Tax-exempt securities: (3)                                         
Other securities     56,530     2,419     4.28     60,971     2,580   4.23  
Total tax-exempt securities     56,530     2,419     4.28     60,971     2,580   4.23  
Interest-earning deposits and federal funds sold     100,723     355     0.35     84,922     1,604   1.89  
Total interest-earning assets     6,862,798     264,835     3.86     6,582,473     279,498   4.25  
Other assets     413,224                 365,408              
Total assets   $ 7,276,022               $ 6,947,881              
                                     
                                     
Interest-bearing Liabilities:                                         
Deposits:                                         
Savings accounts   $ 176,443     495     0.28   $ 198,374     1,378   0.69  
NOW accounts     1,603,402     9,309     0.58     1,434,440     23,553   1.64  
Money market accounts     1,561,496     14,368     0.92     1,370,038     27,819   2.03  
Certificate of deposit accounts     1,167,865     18,096     1.55     1,532,440     35,078   2.29  
Total due to depositors     4,509,206     42,268     0.94     4,535,292     87,828   1.94  
Mortgagors' escrow accounts     70,829     44     0.06     70,209     229   0.33  
Total interest-bearing deposits     4,580,035     42,312     0.92     4,605,501     88,057   1.91  
Borrowings     1,361,559     26,816     1.97     1,251,452     28,959   2.31  
Total interest-bearing liabilities     5,941,594     69,128     1.16     5,856,953     117,016   2.00  
Non interest-bearing demand deposits     583,235                  407,450              
Other liabilities     171,126                  122,189              
Total liabilities     6,695,955                  6,386,592              
Equity     580,067                  561,289              
Total liabilities and equity   $ 7,276,022                $ 6,947,881              
                                     
Net interest income / net interest rate spread
(tax equivalent) (3)
        $ 195,707     2.70 %         $ 162,482   2.25 %
Net interest-earning assets / net interest margin (tax equivalent)   $ 921,204           2.85 %   $ 725,520          2.47 %
Ratio of interest-earning assets to interest-bearing liabilities                 1.16 X              1.12 X

(1) Loan interest income includes loan fee income (which includes net amortization of deferred fees and costs, late charges, and prepayment penalties) of approximately $2.3 million and $2.0 million for the year ended December 31, 2020 and 2019, respectively.
(2) Loan interest income includes net losses from fair value adjustments on qualifying hedges of $1.2 million and $1.7 million for the year ended December 31, 2020 and 2019, respectively.
(3) Interest and yields are calculated on the tax equivalent basis using the statutory federal income tax rate of 21% for the periods presented totaling $0.5 million for each of the year ended December 31, 2020 and 2019. Additionally, net interest income includes purchase accounting adjustments from Empire transaction for the year ended December 31, 2020.


FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
DEPOSIT COMPOSITION
(Unaudited)

                                           
                            December 2020 vs.           December 2020 vs.  
    December 31,    September 30,   June 30,   March 31,   September 2020     December 31,    December 2019  
(Dollars in thousands)      2020      2020      2020      2020      % Change           2019      % Change  
Deposits                                                 
Non-interest bearing   $ 778,672   $ 607,954   $ 581,881   $ 489,198   28.1 %   $ 435,072   79.0   %
Interest bearing:                                                 
Certificate of deposit accounts     1,138,361     1,051,644     1,135,977     1,172,381   8.2     1,437,890   (20.8 ) %
Savings accounts     168,183     160,294     184,895     192,192   4.9     191,485   (12.2 ) %
Money market accounts     1,682,345     1,381,552     1,474,880     1,597,109   21.8     1,592,011   5.7   %
NOW accounts     2,323,172     1,704,915     1,672,241     1,377,555   36.3     1,365,591   70.1   %
Total interest-bearing deposits     5,312,061     4,298,405     4,467,993     4,339,237   23.6     4,586,977   15.8   %
                                           
Total deposits   $ 6,090,733   $ 4,906,359   $ 5,049,874   $ 4,828,435   24.1 %     $ 5,022,049   21.3   %


FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
LOANS
(Unaudited)

Loan Closings

                               
    For the three months ended   For the year ended
     December 31,    September 30,    December 31,     December 31,    December 31, 
(In thousands)      2020      2020      2019      2020      2019
Multi-family residential   $ 52,024   $ 33,733   $ 104,310   $ 212,729   $ 247,607
Commercial real estate     57,634     26,644     55,047     191,852     178,336
One-to-four family – mixed-use property     9,692     3,867     18,653     35,131     66,128
One-to-four family – residential     8,422     2,296     5,833     21,805     25,024
Co-operative apartments                 704     2,117
Construction     6,869     5,420     3,542     21,859     33,919
Small Business Administration (1)     598     18,456     721     112,352     3,426
Commercial business and other     180,830     65,160     81,630     407,725     605,743
Total   $ 316,069   $ 155,576   $ 269,736   $ 1,004,157   $ 1,162,300

(1) Includes $18.4 million of PPP closings for the three months ended September 30, 2020. Includes $111.6 million of PPP closings for the year ended December 31, 2020.

Loan Composition

                                           
                            December 2020 vs.           December 2020 vs.  
    December 31,    September 30,   June 30,   March 31,   September 2020       December 31,    December 2019  
(Dollars in thousands)      2020      2020      2020      2020      % Change           2019      % Change  
Loans held for investment:                                                 
Multi-family residential   $ 2,533,952     $ 2,252,757     $ 2,285,555     $ 2,272,343     12.5   %     $ 2,238,591     13.2   %
Commercial real estate     1,754,754       1,636,659       1,646,085       1,664,934     7.2   %       1,582,008     10.9   %
One-to-four family ― mixed-use property     602,981       585,159       591,347       592,109     3.0   %       592,471     1.8   %
One-to-four family ― residential     245,211       191,011       184,741       189,774     28.4   %       188,216     30.3   %
Co-operative apartments     8,051       8,132       8,423       8,493     (1.0 ) %       8,663     (7.1 ) %
Construction     83,322       63,567       69,433       66,727     31.1   %       67,754     23.0   %
Small Business Administration (1)     167,376       124,649       106,813       14,076     34.3   %       14,445     1,058.7   %
Taxi medallion     2,757       2,317       3,269       3,281     19.0   %       3,309     (16.7 ) %
Commercial business and other     1,303,225       1,063,429       1,073,623       1,104,967     22.5   %       1,061,478     22.8   %
Net unamortized premiums and unearned loan fees (2)     3,045       13,718       13,986       15,384     (77.8 ) %       15,271     (80.1 ) %
Allowance for loan losses     (45,153 )     (38,343 )     (36,710 )     (28,098 )   17.8   %       (21,751 )   107.6   %
Net loans   $ 6,659,521     $ 5,903,055     $ 5,946,565     $ 5,903,990     12.8   %     $ 5,750,455     15.8   %

(1) Includes $151.9 million, $111.6 million and $93.2 million of PPP loans at December 31, 2020 September 30, 2020 and June 30, 2020, respectively.
(2) Includes $11.3 million of purchase accounting unamortized discount resulting from the acquisition of Empire Bancorp.

Net Loans Activity

                               
    Three Months Ended
    December 31,    September 30,   June 30,   March 31,   December 31, 
(In thousands)       2020      2020      2020      2020      2019
Loans originated and purchased   $ 316,069     $ 155,576     $ 233,797     $ 298,715     $ 269,736  
Loans Acquired from Empire Merger     685,404                          
Principal reductions     (226,772 )     (196,221 )     (180,182 )     (137,189 )     (255,977 )
Loans sold                       (498 )     (7,129 )
Loan charge-offs     (752 )     (964 )     (1,030 )     (1,259 )     (95 )
Foreclosures                              
Net change in deferred fees and costs     (10,673 )     (268 )     (1,398 )     113       (92 )
Net change in the allowance for loan losses     (6,810 )     (1,633 )     (8,612 )     (6,347 )     284  
Total loan activity   $ 756,466     $ (43,510 )   $ 42,575     $ 153,535     $ 6,727  


FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
NON-PERFORMING ASSETS and NET CHARGE-OFFS
(Unaudited)

Non-Performing Assets

                                 
       December 31,       September 30,      June 30,      March 31,      December 31,   
(Dollars in thousands)      2020      2020      2020      2020      2019  
Loans 90 Days Or More Past Due and Still Accruing:                                     
Multi-family residential   $ 201   $   $   $   $ 445  
Commercial real estate     2,547                  
Commercial business and other             150          
Total     2,748         150         445  
                                      
Non-accrual Loans:                                     
Multi-family residential     2,524     2,661     3,688     2,741     2,296  
Commercial real estate     1,683     2,657     2,671     8     367  
One-to-four family - mixed-use property (1)     1,366     1,366     2,511     607     274  
One-to-four family - residential     5,854     6,454     6,412     5,158     5,139  
Small Business Administration     1,151     1,151     1,321     1,518     1,151  
Taxi medallion(1)     2,317     2,218     1,757     1,761     1,641  
Commercial business and other(1)     3,430     8,285     1,678     4,959     1,945  
Total     18,325     24,792     20,038     16,752     12,813  
                                      
Total Non-performing Loans     21,073     24,792     20,188     16,752     13,258  
                                      
Other Non-performing Assets:                                     
Real estate acquired through foreclosure             208     208     239  
Other asset acquired through foreclosure     35     35     35     35     35  
Total     35     35     243     243     274  
                                      
Total Non-performing Assets   $ 21,108   $ 24,827   $ 20,431   $ 16,995   $ 13,532  
                                      
Non-performing Assets to Total Assets     0.26 %     0.35 %     0.29 %     0.23 %     0.19 %  
Allowance For Loan Losses to Non-performing Loans     214.3 %     154.7 %     181.8 %     167.7 %     164.1 %  



(1) Not included in the above analysis are non-accrual performing TDR one-to-four family mixed use property loans totaling $0.3 million in 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, $1.5 million in 1Q20, and $1.7 million in 4Q19, and non-accrual performing TDR commercial business loans totaling $2.2 million in 4Q20 and $1.0 million in 3Q20, 2Q20, 1Q20, respectively, and $0.9 million in 4Q19.

Net Charge-Offs (Recoveries)

                               
    Three Months Ended
       December 31,       September 30,      June 30,      March 31,      December 31, 
(In thousands)      2020   2020   2020   2020   2019
Multi-family residential      $ (11 )      $ (14 )      $ (7 )      $ (6 )      $ (14 )
Commercial real estate                                            (30 )
One-to-four family – mixed-use property                 (60 )        3          (78 )        119  
One-to-four family – residential        (2 )        (2 )        (3 )        (5 )        (3 )
Small Business Administration        (3 )        (47 )        165          (7 )        (8 )
Taxi medallion        124          951                             
Commercial business and other        538          9          849          1,245          (98 )
Total net loan charge-offs (recoveries)      $ 646     $ 837     $ 1,007     $ 1,149     $ (34 )


FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
FORBEARANCES DETAIL
(Dollars in thousands)
(Unaudited)

                               
      Forbearances (1)     Backed by Mortgages (1)      
            Balance      % of Sector           Balance      % of Forbearances      LTV     
Higher Risk Segments                              
Restaurants and Catering Halls     $ 20,300   23.8 %     $ 18,850   92.9 %   33.6 %  
Hotels       119,794   62.8       119,794   100.0   56.7  
Travel and Leisure       38,104   20.9       33,918   89.0   36.4  
Retail Services (2)       12,046   8.4       3,169   26.3   36.9  
CRE - Shopping Center       7,508   3.0       7,508   100.0   60.5  
CRE - Single Tenant       8,010   5.8       8,010   100.0   37.7  
CRE - Strip Mall       28,390   9.8       28,390   100.0   56.8  
Transportation (2)       8,736   6.0            
Contractors (2)       5,198   1.5       3,353   64.5   54.2  
Schools and Child Care       13,260   20.3       7,760   58.5   41.9  
Subtotal     $ 261,346   14.2 %     $ 230,752   88.3 %   48.3 %  
                               
Lower Risk Segments     $ 103,072   2.1 %     $ 99,339   96.4 %   37.6 %  
                               
Total     $ 364,418   5.4 %     $ 330,091   90.6 %   44.5 %  
                               



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


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 primarily due to 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 Diluted EPS, Core ROAE, Core ROAA, Pre-provision Pre-tax Net Revenue, Core Net Interest Income, Core Yield on Total Loans, Core Net Interest Margin 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.


FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
RECONCILIATION OF GAAP EARNINGS and CORE EARNINGS
(Dollars in thousands, except per share data)
(Unaudited)

                                 
    Three Months Ended      Year Ended  
       December 31,       September 30,      December 31,       December 31,       December 31,   
    2020   2020   2019   2020   2019  
                                 
GAAP income before income taxes   $ 3,878     $ 18,820     $ 16,888     $ 45,182     $ 53,331    
                                 
Day 1, Provision for Credit Losses - Empire transaction     1,818                   1,818          
Net (gain) loss from fair value adjustments     4,129       2,225       (807 )     2,142       5,353    
Net loss on sale of securities     610                   701       15    
Life insurance proceeds                 (419 )     (659 )     (462 )  
Net gain on sale of assets                             (770 )  
Net (gain) loss from fair value adjustments on qualifying hedges     (1,023 )     (230 )     (1,039 )     1,185       1,678    
Accelerated employee benefits upon Officer's death                             455    
Prepayment Penalty on Borrowings     7,834                   7,834          
Net amortization of purchase accounting adjustments     80                   80          
Merger expense     5,349       422       1,080       6,894       1,590    
                                 
Core income before taxes     22,675       21,237       15,703       65,177       61,190    
                                 
Provision for income taxes for core income     4,891       5,069       3,841       15,428       13,957    
                                 
Core net income   $ 17,784     $ 16,168     $ 11,862     $ 49,749     $ 47,233    
                                 
GAAP diluted earnings per common share   $ 0.11     $ 0.50     $ 0.45     $ 1.18     $ 1.44    
                                 
Day 1, Provision for Credit Losses - Empire transaction, net of tax     0.05                   0.05          
Net (gain) loss from fair value adjustments, net of tax     0.11       0.06       (0.02 )     0.06       0.14    
Net loss on sale of securities, net of tax     0.02                   0.02          
Life insurance proceeds                 (0.01 )     (0.02 )     (0.02 )  
Net gain on sale of assets, net of tax                             (0.02 )  
Net (gain) loss from fair value adjustments on qualifying hedges, net of tax     (0.03 )     (0.01 )     (0.03 )     0.03       0.05    
Accelerated employee benefits upon Officer's death, net of tax                             0.01    
Prepayment Penalty on Borrowings, net of tax     0.20                   0.20          
Net amortization of purchase accounting adjustments, net of tax                                
Merger expense, net of tax     0.14       0.01       0.03       0.18       0.04    
                                 
Core diluted earnings per common share(1)   $ 0.58     $ 0.56     $ 0.41     $ 1.70     $ 1.65    
                                 
                                 
Core net income, as calculated above   $ 17,784     $ 16,168     $ 11,862     $ 49,749     $ 47,233    
Average assets     7,705,407       7,083,028       7,057,094       7,276,022       6,947,881    
Average equity     609,463       576,512       567,461       580,067       561,289    
Core return on average assets(2)     0.92   %     0.91   %     0.67   %     0.68   %     0.68   %
Core return on average equity(2)     11.67   %     11.22   %     8.36   %     8.58   %     8.42   %



(1) Core diluted earnings per common share may not foot due to rounding.
(2) Ratios are calculated on an annualized basis.


FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
RECONCILIATION OF GAAP REVENUE and PRE-PROVISION
PRE-TAX NET REVENUE
(Dollars in thousands)
(Unaudited)

                                 
    Three Months Ended      Year Ended  
       December 31,       September 30,      December 31,       December 31,       December 31,   
    2020   2020   2019   2020   2019  
                                 
Net interest income   $ 55,732     $ 49,924     $ 41,179     $ 195,199     $ 161,940    
                                 
Non-interest income     (1,181 )     1,351       5,038       11,043       9,471    
Non-interest expense     (46,811 )     (29,985 )     (29,647 )     (137,931 )     (115,269 )  
                                 
                                 
Pre-provision pre-tax net revenue (1)   $ 7,740     $ 21,290     $ 16,570     $ 68,311     $ 56,142    
                                 

(1) Includes non-cash net gains (losses) from fair value adjustments totaling ($3.1) million, ($2.0) million and $1.8 million for the three months ended December 31, 2020, September 30, 2020 and December 31, 2019, respectively and ($3.3) million and ($7.0) million for the year ended December 31, 2020 and 2019, respectively.


FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
RECONCILIATION OF GAAP NET INTEREST INCOME and NET INTEREST MARGIN
To CORE NET INTEREST INCOME and NET INTEREST MARGIN
(Dollars in thousands)
(Unaudited)

                                 
    Three Months Ended   Year Ended  
       December 31,       September 30,      December 31,       December 31,       December 31,   
    2020   2020   2019   2020   2019  
GAAP net interest income   $ 55,732     $ 49,924     $ 41,179     $ 195,199     $ 161,940    
Net (gain) loss from fair value adjustments on qualifying hedges     (1,023 )     (230 )     (1,039 )     1,185       1,678    
Net amortization of purchase accounting adjustments     (11 )                 (11 )        
Core net interest income   $ 54,698     $ 49,694     $ 40,140     $ 196,373     $ 163,618    
                                 
                                 
GAAP interest income on total loans, net   $ 66,120     $ 60,367     $ 64,316     $ 248,153     $ 251,744    
Net (gain) loss from fair value adjustments on qualifying hedges     (1,023 )     (230 )     (1,039 )     1,185       1,678    
Prepayment penalties received on loans     (857 )     (1,357 )     (926 )     (3,669 )     (4,548 )  
Net recoveries of interest from non-accrual loans     (236 )     (86 )     (428 )     (832 )     (1,953 )  
Net amortization of purchase accounting adjustments     (356 )                 (356 )        
Core interest income on total loans, net   $ 63,648     $ 58,694     $ 61,923     $ 244,481     $ 246,921    
Average total loans, net (1)   $ 6,379,429     $ 5,904,051     $ 5,726,635     $ 6,007,857     $ 5,621,033    
Core yield on total loans     3.99   %     3.98   %     4.33   %     4.07   %     4.39   %
                                 
                                 
Net interest income tax equivalent   $ 55,846     $ 50,041     $ 41,323     $ 195,707     $ 162,482    
Net (gain) loss from fair value adjustments on qualifying hedges     (1,023 )     (230 )     (1,039 )     1,185       1,678    
Prepayment penalties received on loans and securities     (857 )     (1,432 )     (926 )     (3,744 )     (4,548 )  
Net recoveries of interest from non-accrual loans     (236 )     (86 )     (428 )     (832 )     (1,953 )  
Net amortization of purchase accounting adjustments     (11 )                 (11 )        
Net interest income used in calculation of Core net interest margin   $ 53,719     $ 48,293     $ 38,930     $ 192,305     $ 157,659    
Total average interest-earning assets (1)   $ 7,245,147     $ 6,675,896     $ 6,677,325     $ 6,864,145     $ 6,582,473    
Core net interest margin     2.97   %     2.89   %     2.33   %     2.80   %     2.40   %
                                 
                                 



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


FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
CALCULATION OF TANGIBLE STOCKHOLDERS’
COMMON EQUITY to TANGIBLE ASSETS
(Unaudited)

                     
       December 31,       September 30,       December 31,   
(Dollars in thousands)   2020   2020   2019  
Total Equity   $ 618,997     $ 586,406     $ 579,672    
Less:                       
Goodwill     (17,636 )     (16,127 )     (16,127 )  
Core deposit Intangibles     (3,172 )              
Intangible deferred tax liabilities     287       292       292    
Tangible Stockholders' Common Equity   $ 598,476     $ 570,571     $ 563,837    
                     
Total Assets   $ 7,976,394     $ 7,063,056     $ 7,017,776    
Less:                       
Goodwill     (17,636 )     (16,127 )     (16,127 )  
Core deposit Intangibles     (3,172 )              
Intangible deferred tax liabilities     287       292       292    
Tangible Assets   $ 7,955,873     $ 7,047,221     $ 7,001,941    
                     
Tangible Stockholders' Common Equity to Tangible Assets     7.52   %     8.10   %     8.05   %

__________________________________

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

Susan K. Cullen
Senior Executive Vice President, Treasurer and Chief Financial Officer
Flushing Financial Corporation
(718) 961-5400


Primary Logo

Legal Disclaimer:

EIN Presswire provides this news content "as is" without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the author above.