GlobeNewswire Inc | Apr 21, 2021 04:15PM EDT

April 21, 2021

BAYONNE, N.J., April 21, 2021 (GLOBE NEWSWIRE) -- BCB Bancorp, Inc. (the Company), (NASDAQ: BCBP), the holding company for BCB Community Bank (the Bank), today reported net income of $7.1 million for the first quarter of 2021, compared to $7.3 million in the fourth quarter of 2020, and $2.5 million in the first quarter of 2020. Earnings per diluted share in the first quarter of 2021 were $0.40, compared to $0.41 in the preceding quarter and $0.12 in the first quarter of 2020. The Company also announced that its Board of Directors declared a regular quarterly cash dividend of $0.14 per share. The dividend will be payable May 24, 2021, to common shareholders of record on May 10, 2021.

Earnings for the first quarter of the year were strong, with higher net interest income and improved efficiencies, stated Thomas Coughlin, President and Chief Executive Officer. Loan accommodations continued to decline during the quarter as our clients experienced steady recoveries and local markets resumed activity. We have remained focused on credit quality and maintaining our strong capital position while helping our customers. Our continued efforts to deleverage the balance sheet, control interest expense, and deploy excess cash helped expand our net interest margin by 13 basis points during the first quarter of 2021, compared to the prior quarter. We believe our reserve levels are adequate to cover potential loan losses stemming from the pandemic. As the Federal Reserve anticipates economic growth in the second half of the year and as vaccinations continue to roll out, the Company has laid a solid foundation from which to emerge from the pandemic even stronger.

At the early onset of the pandemic, we were active participants in the first round of the Small Business Administrations (SBA) Paycheck Protection Program (PPP), allowing us to assist approximately 1,100 of our customers who received $133 million in PPP funding during 2020. As regulations, guidance, and the forgiveness process for PPP loans continued to evolve, we recognized the operational risk and complexity associated with this portfolio. As a result, we sold the PPP loan portfolio during the fourth quarter of 2020 to a third party.

The Company is particpating in the latest round of PPP lending pursuant to the Consolidated Appropriations Act of 2021 (CAA), the PPP Extension Act of 2021 and the American Rescue Plan Act (ARPA). The CAA provided additional COVID-19 stimulus relief and included $284 billion allocated for another round of PPP lending. The program offered new PPP loans for companies that did not receive a PPP loan in 2020, as well as second-draw loans targeted at hard-hit businesses that have already spent their initial PPP proceeds. We have been active participants in this new round of PPP funding by partnering as a referral agent with an SBA Small Business Lending Company, The Loan Source Inc., for the application, forgiveness, and ongoing-service process of PPP loans, thereby eliminating our operational risk and allowing us to continue to help our business customers as we did during the first round of funding, said Coughlin.

Executive Summary

-- Net interest margin was 3.48 percent for the first quarter of 2021, a 13-basis point increase compared to 3.35 percent for the fourth quarter of 2020, and an 85-basis point improvement from 2.63 percent for the first quarter of 2020. Total yield on interest-earning assets decreased 3 basis points to 4.15 percent for the first quarter of 2021, compared to 4.18 percent for the fourth quarter of 2020, and increased 3 basis points from 4.12 percent for the first quarter of 2020.Total cost of interest-bearing liabilities decreased 19 basis points to 0.85 percent for the first quarter of 2021, compared to 1.04 percent for the fourth quarter of 2020 and decreased 93 basis points from 1.78 percent for the first quarter of 2020. -- Net income was $7.1 million in the first quarter of 2021, compared to $7.3 million in the prior quarter and $2.5 million in the first quarter a year ago. -- Earnings per diluted share were $0.40 in the first quarter of 2021, compared to $0.41 in the prior quarter and $0.12 in the first quarter of 2020. -- The efficiency ratio for the first quarter improved to 53.24% compared to both the previous quarter and year-ago quarters. -- Loans receivable, net of allowance for loan losses, increased by 6.1 percent, to $2.296 billion at March 31, 2021, from $2.164 billion a year earlier. -- The provision for loan losses increased by $0.4 million, to $1.9 million for the first quarter of 2021, compared to a provision for loan losses of $1.5 million for the first quarter of 2020; this increase was primarily due to factors related to the COVID-19 pandemic. -- Allowance for loan losses as a percentage of non-accrual loans was 246.3 percent at March 31, 2021, compared to 205.2 percent for the prior quarter and 585.4 percent at March 31, 2020, as total non-accrual loans decreased to $14.4 million at March 31, 2021 from $16.4 million for the prior quarter and increased compared to $4.4 million at March 31, 2020. -- Total deposits were $2.404 billion at March 31, 2020, up from $2.376 billion a year ago. -- The Company purchased $8.5 million of BOLI during the first quarter of 2021. -- On April 14, 2021, the Companys Board of Directors declared a regular quarterly cash dividend of $0.14 per share. The dividend will be payable May 24, 2021, to common shareholders of record on May 10, 2021.

Balance Sheet ReviewTotal assets increased by $31.4million, or 1.1 percent, to $2.852billion at March 31, 2021 from $2.821billion at December 31, 2020. The increase in total assets was mainly related to an increase in total cash and cash equivalents, partly offset by a decrease in investment securities.

Total cash and cash equivalents increased by $35.7million, or 13.7 percent, to $296.9million at March 31, 2021 from $261.2million at December 31, 2020. This increase was mainly related to an increase in deposits, partly offset by net repayments of borrowings.

Loans receivable, net increased by $1.4million, or 0.1 percent, to $2.296billion at March 31, 2021 from $2.295billion at December 31, 2020. Total loan increases for the first quarter of 2021 included increases of $11.3million in construction loans, $9.3million in commercial real estate and multi-family loans, and $29,000 in consumer loans, partly offset by decreases of $10.0 million in residential one-to-four family loans, $7.0 million in commercial business loans, and $307,000 in home equity loans. The allowance for loan losses increased $1.8million to $35.5million, or 246.3 percent of non-accruing loans and 1.52 percent of gross loans, at March 31, 2021 as compared to an allowance for loan losses of $33.6million, or 205.2 percent of non-accruing loans and 1.44 percent of gross loans, at December 31, 2020.

Total investment securities decreased by $5.6million, or 4.8 percent, to $111.9million at March 31, 2021 from $117.5million at December 31, 2020, representing repayments, calls and maturities, partly offset by purchases of $757,000.

Deposit liabilities increased by $86.1million, or 3.7 percent, to $2.404billion at March 31, 2021 from $2.318billion at December 31, 2020. The increase in deposit liabilities mainly related to the recent payments to individuals under the ARPA and the second round of PPP payments under the CAA. Total increases for the three months ended March 31, 2021 included $52.0 million in non-interest-bearing deposit accounts, $20.2 million in money market checking accounts, $13.5 million in savings and club accounts and $6.3 million in NOW deposit accounts. The increase in deposits was partly offset by decreases of $5.9 million in certificates of deposit, including listing service and brokered deposit accounts. The Company utilizes listing service and brokered certificates of deposit as additional sources of deposit liquidity to fund loan growth. At March 31, 2021, the Company had $17.0 million in listing service deposits and no brokered certificates of deposit.

Debt obligations decreased by $57.8million, or 25.3 percent, to $170.4million at March 31, 2021 from $228.2million at December 31, 2020. The weighted average interest rate of FHLB advances was 1.40 percent at March 31, 2021 and 1.66 percent at December 31, 2020. The fixed interest rate of our subordinated debt balances was 5.625 percent at March 31, 2021 and December 31, 2020. During the three months ended March 31, 2021, the Company opted to extinguish $68.0million in FHLB advances which held a weighted average rate of 2.00%. The advances were originally set to mature in 2021 and 2022. The effect of the extinguishment of the debt reduced the weighted average cost of FHLB borrowings by approximately 20 basis points on an annualized basis. The related expense for the extinguishment of this debt is included in noninterest expense.

Stockholders equity increased by $4.3million, or 1.7 percent, to $253.5million at March 31, 2021 from $249.2million at December 31, 2020. The increase was primarily attributable to the increase in retained earnings of $4.4million, or 7.6 percent, to $62.8million at March 31, 2021 from $58.4million at December 31, 2020, related to the net effect of net income less dividends paid for the three months ended March 31, 2021.

First Quarter 2021 Income Statement Review

Net interest income increased by $4.8 million, or 25.5 percent, to $23.6million for the first quarter of 2021 from $18.8million for the first quarter of 2020. The increase in net interest income resulted primarily from a $6.1 million decrease in interest expense related to a decrease in the average rate on interest-bearing liabilities of 93 basis points to 0.85 percent for the first quarter of 2021 from 1.78 percent for the first quarter of 2020, as well as a decrease in the average balance of interest-bearing liabilities of $273.5million, or 11.4 percent, to $2.120billion for the first quarter of 2021 from $2.393billion for the first quarter of 2020.

Interest income was $1.3 million lower than the prior year, related to a decrease in the average balance of interest-earning assets of $153.7 million, or 5.4 percent, to $2.705 billion for the first quarter of 2021 from $2.859 billion for the first quarter of 2020. The decrease in the average balance of interest-earning assets was partly offset by an increase in the average yield of interest-earning assets of three basis points to 4.15 percent for the first quarter of 2021 from 4.12 percent for the first quarter of 2020. The decrease in the average balance of interest earning assets mainly relates to a decrease in the Companys level of cash balances for the first quarter of 2021 as compared to the first quarter of 2020, as the average balances of deposits and FHLB advances decreased.

Interest expense decreased by $6.1 million, or 57.6 percent, to $4.5million for the first quarter of 2021 from $10.6million for the first quarter of 2020. This decrease resulted primarily from a decrease in the average rate on interest-bearing liabilities of 93 basis points to 0.85 percent for the first quarter of 2021 from 1.78 percent for the first quarter of 2020, as well as a decrease in the average balance of interest-bearing liabilities of $273.5million, or 11.4 percent, to $2.120billion for the first quarter of 2021 from $2.393billion for the first quarter of 2020. The decreases in the average cost of funds and the average balance of interest-bearing liabilities primarily resulted from the declining interest rate environment and the Companys strategy of a heightened focus on cost of funds and continued deleveraging.

Net interest margin was 3.48 percent for the first quarter of 2021, compared to 2.63 percent for the first quarter of 2020. The increase in the net interest margin compared to the prior-year period was the result of the volatile financial markets attributable to the COVID-19 pandemic and the low interest rate environment that were more prevalent in the prior period. Management has been proactive in managing its cost of funds and has significantly decreased the average cost of total interest-bearing liabilities, while slightly improving the average yield on interest-earning assets for the first quarter of 2021 compared to the first quarter of 2020. Despite the ongoing pandemic, the Company has been able to increase its average balance of loans receivable for the first quarter of 2021 as compared to the first quarter of 2020. This increase in the average balance of loans receivable, and the corresponding decrease in cash balances, highlight managements efforts to maintain a strong net interest margin.

Non-interest income increased by $1.3 million, or 185.5 percent, to $2.0million for the first quarter of 2021 from $683,000 for the first quarter of 2020. The increase in total noninterest income was mainly related to higher BOLI income of $701,000, higher fees and service charges of $385,000, a lower unrealized loss on equity securities of $244,000, and a higher gain on the sales of loans of $213,000, partly offset by lower other noninterest income of $276,000. The increase in BOLI income relates to an initial purchase of $60.0 million of BOLI product in the third quarter of 2020, and an additional purchase of $8.5 million in the first quarter of 2021. The higher fees and service charges related primarily to $328,000 of referral fees for PPP loans. The decrease in other noninterest income related to the reversal of $295,000 of liabilities previously recorded for acquired loans that paid off in the prior-year quarter. Unrealized gains or losses on equity securities, and the gain on loan sales, are based on market conditions.

Non-interest expense decreased by $781,000, or 5.4 percent, to $13.6million for the first quarter of 2021 from $14.4million for the first quarter of 2020. Salaries and employee benefits expense decreased by $844,000, or 11.4 percent, to $6.5 million for the first quarter of 2021 from $7.4million for the first quarter of 2020, primarily related to fewer full-time equivalent employees, partly offset by normal compensation increases. The number of full-time equivalent employees for the first quarter of 2021 was 312, as compared with 371 for the same period in 2020. Occupancy and equipment expense increased by $129,000, or 4.6 percent, to $3.0million for the first quarter of 2021 from $2.8million for the first quarter of 2020, largely related to building sanitization costs associated with the COVID-19 pandemic, which costs were partly offset by the closure of two of the Companys branch offices in the fourth quarter of 2020.The Company recognized an expense of $540,000 for a loss on extinguishment of debt, related to the prepayment of higher-cost FHLB borrowings, for the first quarter of 2021. Other noninterest expense decreased by $491,000, or 24.8 percent, to $1.5million for the first quarter of 2021 from $2.0million for the first quarter of 2020. Other noninterest expense consisted of loan expense, business development, office supplies, correspondent bank fees, telephone and communication and miscellaneous fees and expenses. The decrease in the current period was primarily related to a reduction of business development and loan-related expenses, largely attributable to the current pandemic condition.

The income tax provision increased by $1.9 million, or 173.9 percent, to $2.9million for the first quarter of 2021 from $1.0million for the first quarter of 2020. The increase in the income tax provision was a result of higher taxable income for the first quarter of 2021 as compared with that same period for 2020. The consolidated effective tax rate for the first quarter of 2021 was 29.3 percent compared to 29.9 percent for the first quarter of 2020. The lower rate in the current period related primarily to non-taxable BOLI income and lower non-deductible costs in the current year period.

Asset Quality

During the first quarter of 2021, the Company recognized $27,000 in net charge-offs, compared to $300,000 in net recoveries for the first quarter of 2020.

The COVID-19 pandemic has caused disruption to the global economy, but the extent and duration of the disruption is uncertain at this time. Management will continue to monitor any activity for loan deferment requests and delinquencies on a regular basis.

While we experienced some decline in asset quality metrics during 2020, we have since seen a turnaround as non-accrual loans, impaired loans, and classified loans declined as of the end of the current quarter, despite the continued challenges from COVID-19. With respect to chargeoffs, we have been in a net recovery position looking back over the last four quarters, but continue to provide additional loan loss reserves in response to the ongoing business disruption caused by the pandemic, said Coughlin.

The provision for loan losses increased by $400,000, to $1.9million, for the first quarter of 2021, compared to $1.5 million for the first quarter of 2020; this increase was primarily due to COVID-19 related factors. The Bank had non-accrual loans totaling $14.4million, or 0.62 percent, of gross loans at March 31, 2021, as compared to $16.4million, or 0.70 percent, of gross loans at December 31, 2020.

Performing troubled debt restructured (TDR) loans that were not included in nonaccrual loans at March 31, 2021, were $13.5 million, compared to $13.8 million at December 31, 2020. Borrowers who are in financial difficulty and who have been granted concessions (excluding COVID-19 modifications) that may include interest rate reductions, term extensions, or payment alterations, are categorized as TDR loans.

The allowance for loan losses was $35.5million, or 1.52 percent of gross loans at March 31, 2021, and $33.6million, or 1.44 percent of gross loans at December 31, 2020. The allowance for loan losses was 246.3 percent of non-accrual loans at March 31, 2021, and 205.2 percent of non-accrual loans at December 31, 2020.

COVID-19 Response

With the global outbreak of COVID-19, the Company remains focused on protecting the health and well-being of its employees and the communities in which it operates while assuring the continuity of its business operations.

The Company activated its dedicated pandemic team that proactively implemented its business continuity plans and has taken a variety of measures to ensure the ongoing availability of services, while taking health and safety measures, including enhanced cleaning and hygiene protocols in all of its facilities and remote work policies, where possible. To date, as a result of these business continuity measures, the Company has not experienced significant disruptions in its operations.

-- Operational Initiatives The pandemic response team meets on an as-needed basis and actively monitors guidance released byregulators and banking associations.In-person meetings are closely managed and are held on an as needed basis only.Many employees are working remotely, temporarily relocated or are working alternate days to increase social distancing.Barriers have been installed in branches and back offices to provide protection.Branch and operational offices are cleaned and sanitized biweekly and employees have access to masks, gloves and disinfectant.Masks are required for entry and social distancing is strictly enforced. Management provides updates to employees on a regular basis.The Call Center is open six days a week to assist with customer inquiries.Branch offices are open; however customers have the ability to make an appointment if they choose. The company is encouraging customers to utilize the ATM, drive-through and electronic banking services wherever possible.The Bank is working with a local provider to have the vaccine administered at one of the banks locations. -- Allowance for Loan Losses (ALLL) The Bank increased its loan loss reserves through the addition of $1.9million in loan loss provisions for the three-month period ending March 31, 2021, as compared to $1.5 million for the same period last year. The Bank considered qualitative factors, such as changes in underwriting policies, current economic conditions, delinquency statistics, the adequacy of the underlying collateral and the financial strength of borrowers in arriving at its loan loss provision. All of these factors are likely to be affected by the COVID-19 pandemic. Loan categories for specific business types were stressed due to rising delinquencies within those market sectors (hospitality, restaurants, office space, and commercial condos) to determine the potential for collateral shortfalls. The impact of COVID-19 is likely to be felt over the next several quarters. Adjustments to the ALLL may be required as the full impact of COVID-19 on the borrowers capacity to make payments and the value of the underlying collateral becomes known.

-- Loan DefermentsThe banking regulatory agencies, through an Interagency Statement dated April7, 2020, encouraged financial institutions to work prudently with borrowers who request loan modifications or deferrals as a result of COVID-19. The Bank did so in 2020, but now has no deferred loans within its portfolio.The Coronavirus Aid, Relief, and Economic Security Act, or CARES Act, was signed into law on March27, 2020, and provided over $2.0 trillion in emergency economic relief to individuals and businesses impacted by the COVID-19 pandemic. Under Section 4013 of the CARES Act, loans less than 30 days past due as of December31, 2019 will be considered current for COVID-19 modifications. A financial institution can then suspend the requirements under GAAP for loan modifications related to COVID-19 that would otherwise be categorized as a TDR, and suspend any determination of a loan modified as a result of COVID-19 as being a TDR, including the requirement to determine impairment for accounting purposes. Most of these loans are accruing interest and the Bank is considering the loans within the overall allowance for loan loss analysis.The Bank has worked with customers that previously requested loan deferments and entered into COVID-19 modifications. The loan balances for these customers at March 31, 2021 was approximately $86.2 million. The modifications generally provide a short-term, interest-only period. The Bank does not believe that these modified loans will result in losses, so long as the borrowers' representation of cash flows is realized. Borrowers that have requested modifications with less definitive cash flow projections have been denied and are being analyzed as part of the loan stress testing and Allowance for Loan Loss calculation.

-- Paycheck Protection Program (PPP) The Bank has partnered with The Loan Source, Inc. and recognized $328,000 in referral fees for the second round of PPP loans in the first quarter of 2021.

-- IT Changes To protect the well-being of our staff and customers, the Company has set up resources for some employees to work from home. To facilitate the move, we allocated laptop computers to staff and enhanced our ability to access the network offsite. We have taken additional steps to minimize the increased risk of security breaches (including privacy breaches and cyber-attacks), given the increased number of employees working remotely.

-- Liquidity and Capital ResourcesThe Company was well positioned with adequate levels of cash and liquid assets as of March 31, 2021, as well as wholesale borrowing capacity of over $800million. At March 31, 2021, the Companys equity to assets ratio was 8.89 percent and the Bank is considered well capitalized under its regulatory requirements. The Company will continue to monitor the effects of COVID-19 in determining future cash dividends and any requirement for additional capital each quarter.

About BCB Bancorp, Inc.

Established in 2000 and headquartered in Bayonne, N.J., BCB Community Bank is the wholly-owned subsidiary of BCB Bancorp, Inc. (NASDAQ: BCBP). The Bank has 29 branch offices in Bayonne, Carteret, Edison, Hoboken, Fairfield, Holmdel, Jersey City, Lyndhurst, Maplewood, Monroe Township, Newark, Parsippany, Plainsboro, River Edge, Rutherford, South Orange, Union, and Woodbridge, New Jersey, and three branches in Hicksville and Staten Island, New York. The Bank provides businesses and individuals a wide range of loans, deposit products, and retail and commercial banking services. For more information, please go to www.bcb.bank.

Forward-Looking Statements

This release, like many written and oral communications presented by BCB Bancorp, Inc., and our authorized officers, may contain certain forward-looking statements regarding our prospective performance and strategies 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. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and are including this statement for purposes of said safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe future plans, strategies, and expectations of the Company, are generally identified by use of words anticipate, believe, estimate, expect, intend, plan, project, seek, strive, try, or future or conditional verbs such as could, may, should, will, would, or similar expressions. Our ability to predict results or the actual effects of our plans or strategies is inherently uncertain. Accordingly, actual results may differ materially from anticipated results.

In addition to factors previously disclosed in the Companys reports filed with the U.S. Securities and Exchange Commission (the "SEC") and those identified elsewhere in this release, the following factors, among others, could cause actual results to differ materially from forward-looking statements or historical performance: changes in asset quality and credit risk; the inability to sustain revenue and earnings growth; changes in interest rates and capital markets; inflation; customer acceptance of the Banks products and services; customer borrowing, repayment, investment and deposit practices; customer disintermediation; the introduction, withdrawal, success and timing of business initiatives; competitive conditions; the inability to realize cost savings or revenues or to implement integration plans and other consequences associated with mergers, acquisitions and divestitures; economic conditions; and the impact, extent and timing of technological changes, capital management activities, and actions of governmental agencies and legislative and regulatory actions and reforms.

As the result of the COVID-19 pandemic and the related adverse local and national economic consequences, the Company could be subject to any of the following additional risks, any of which could have a material, adverse effect on our business, financial condition, liquidity, and results of operations:

-- demand for our products and services may decline, making it difficult to grow assets and income; -- if the economy is unable to substantially reopen, and high levels of unemployment continue for an extended period of time, loan delinquencies, problem assets, and foreclosures may increase, resulting in increased charges and reduced income; -- collateral for loans,especially real estate, may decline in value, which could cause loan losses to increase; -- our allowance for loan losses may have to be increased if borrowers experience financial difficulties beyond forbearance periods, which will adversely affect our net income; -- the net worth and liquidity of loan guarantors may decline, impairing their ability to honor commitments to us; -- as the result of the decline in the Federal Reserve Boards target federal funds rate to near 0%, the yield on our assets may decline to a greater extent than the decline in our cost of interest-bearing liabilities, reducing our net interest margin and spread and reducing net income; -- a material decrease in net income over several quarters could result in a decrease in the rate of our quarterly cash dividend; -- our cyber security risks are increased as the result of an increase in the number of employees working remotely; -- we rely on third party vendors for certain services and the unavailability of a critical service due to the COVID-19 outbreak could have an adverse effect on us; -- FDIC premiums may increase if the agency experiences additional resolution costs; and -- civil unrest could occur in the communities that the Company serves.

Annualized, pro forma, projected and estimated numbers are used for illustrative purpose only, are not forecasts and may not reflect actual results.

Explanation of Non-GAAP Financial Measures

Reported amounts are presented in accordance with accounting principles generally accepted in the United States of America ("GAAP"). This press release also contains certain supplemental Non-GAAP information that the Companys management uses in its analysis of the Companys financial results. The Companys management believes that providing this information to analysts and investors allows them to better understand and evaluate the Companys core financial results for the periods in question.

The Company provides measurements and ratios based on tangible stockholders' equity and efficiency ratios. These measures are utilized by regulators and market analysts to evaluate a companys financial condition and, therefore, the Companys management believes that such information is useful to investors.

For a reconciliation of GAAP to Non-GAAP financial measures included in this press release, see "Reconciliation of GAAP to Non-GAAP Financial Measures" below.

Statements of Income - Three Months Ended, March March March 31, December 31, March 31, 31, 2021 31, 2021 2021 2020 2020 vs. vs. December March 31, 2020 31, 2020Interest and dividend (In thousands, except per share income: amounts)Loans, including $ 26,863 $ 27,090 $ 26,814 -0.8 % 0.2 %feesMortgage-backed 206 298 563 -30.9 % -63.4 %securitiesOther investment 784 743 8 5.5 % 9700.0 %securitiesFHLB stock andother interest earning 222 204 2,034 8.8 % -89.1 %assetsTotalinterest and dividend 28,075 28,335 29,419 -0.9 % -4.6 %income Interest expense: Deposits: Demand 1,198 1,220 2,208 -1.8 % -45.7 %Savings and club 118 116 105 1.7 % 12.4 %Certificates of 1,992 2,702 6,432 -26.3 % -69.0 %deposit 3,308 4,038 8,745 -18.1 % -62.2 %Borrowings 1,205 1,546 1,896 -22.1 % -36.4 %Total 4,513 5,584 10,641 -19.2 % -57.6 %interest expense Net interest income 23,562 22,751 18,778 3.6 % 25.5 %Provision for loan 1,865 1,915 1,500 -2.6 % 24.3 %losses Net interest incomeafter provision for 21,697 20,836 17,278 4.1 % 25.6 %loan losses Non-interest income: Fees and service 1,111 805 726 38.0 % 53.0 %chargesGain on sales of 274 600 61 -54.3 % 349.2 %loansGain on sale of - 26 - -100.0 % 0.0 %impaired loansLoss on sales ofother real estate - (38 ) - -100.0 % 0.0 %ownedGain on sale of - 658 - -100.0 % 0.0 %investment securitiesBOLI income 701 648 - 8.2 % 0.0 %Realized andunrealized (loss) gain (196 ) 970 (440 ) -120.2 % 55.5 %on equity investmentsOther 60 75 336 -20.0 % -82.1 %Total 1,950 3,744 683 -47.9 % 185.5 %non-interest income Non-interest expense: Salaries and 6,545 6,460 7,389 1.3 % -11.4 %employee benefitsOccupancy and 2,953 3,018 2,824 -2.2 % 4.6 %equipmentData processing 1,008 986 938 2.2 % 7.5 %and service feesProfessional 412 393 470 4.8 % -12.3 %feesDirector fees 247 354 358 -30.2 % -31.0 %Regulatory 376 461 321 -18.4 % 17.1 %assessment feesAdvertising and 12 22 61 -45.5 % -80.3 %promotionalOther real estate 4 43 26 -90.7 % -84.6 %owned, netLoss from 540 837 - -35.5 % 0.0 %extinguishment of debtOther 1,486 1,804 1,977 -17.6 % -24.8 %Total 13,583 14,378 14,364 -5.5 % -5.4 %non-interest expense Income before income 10,064 10,202 3,597 -1.4 % 179.8 %tax provisionIncome tax provision 2,947 2,904 1,076 1.5 % 173.9 % Net Income 7,117 7,298 2,521 -2.5 % 182.3 %Preferred stock 283 286 344 -1.0 % -17.7 %dividendsNet Income available $ 6,834 $ 7,012 $ 2,177 -2.5 % 213.9 %to common stockholders Net Income per commonshare-basic and dilutedBasic $ 0.40 $ 0.41 $ 0.12 -2.4 % 233.3 %Diluted $ 0.40 $ 0.41 $ 0.12 -2.4 % 233.3 % Weighted averagenumber of common shares outstandingBasic 17,115 17,094 17,502 0.1 % -2.2 %Diluted 17,232 17,104 17,551 0.7 % -1.8 %

March March 31,Statements of December 31, 31, 2021 2021 vs.Financial March 31, 2021 2020 March 31, 2020 vs. March 30,Condition December 2020 31, 2020ASSETS (In Thousands, except per share amounts) Cash and amountsdue from $ 24,796 $ 23,201 $ 24,292 6.9 % 2.1 %depositoryinstitutionsInterest-earning 272,142 238,028 570,894 14.3 % -52.3 %depositsTotal cashand cash 296,938 261,229 595,186 13.7 % -50.1 %equivalents Interest-earning 735 735 735 - - time depositsDebt securitiesavailable for 93,582 99,756 95,429 -6.2 % -1.9 %saleEquity 18,278 17,717 1,580 3.2 % 1056.8 %investmentsLoans held for 1,147 3,530 838 -67.5 % 36.9 %saleLoansreceivable, net of allowance forloan lossesof$35,477,$33,639, and 2,296,434 2,295,021 2,164,057 0.1 % 6.1 %$25,534respectivelyFederal HomeLoan Bank of New 8,920 11,324 14,586 -21.2 % -38.8 %York stock, atcostPremises and 14,796 15,272 19,292 -3.1 % -23.3 %equipment, netAccrued interest 12,056 12,924 8,936 -6.7 % 34.9 %receivableOther real 414 414 1,623 0.0 % -74.5 %estate ownedDeferred income 13,239 12,574 10,653 5.3 % 24.3 %taxesGoodwill andother 5,472 5,488 5,535 -0.3 % -1.1 %intangiblesOperating leaseright-of-use 14,328 14,988 14,084 -4.4 % 1.7 %assetBank-owned lifeinsurance 70,234 61,033 - 15.1 % 0.0 %("BOLI")Other assets 5,887 9,011 9,469 -34.7 % -37.8 %Total $ 2,852,460 $ 2,821,016 $ 2,942,003 1.1 % -3.0 %Assets LIABILITIES ANDSTOCKHOLDERS' EQUITY LIABILITIES Non-interest $ 454,061 $ 402,100 $ 293,174 12.9 % 54.9 %bearing depositsInterest bearing 1,950,074 1,915,950 2,082,547 1.8 % -6.4 %depositsTotal 2,404,135 2,318,050 2,375,721 3.7 % 1.2 %depositsFHLB advances 133,298 191,161 262,800 -30.3 % -49.3 %Subordinated 37,101 37,042 36,868 0.2 % 0.6 %debenturesOperating lease 14,589 15,224 14,246 -4.2 % 2.4 %liabilityOther 9,883 10,328 11,730 -4.3 % -15.7 %liabilitiesTotal 2,599,006 2,571,805 2,701,365 1.1 % -3.8 %Liabilities STOCKHOLDERS' EQUITYPreferred stock:$0.01 par value, - - - - - 10,000 sharesauthorizedAdditionalpaid-in capital 25,723 25,723 24,876 0.0 % 3.4 %preferred stockCommon stock: nopar value, - - - - - 40,000 sharesauthorizedAdditionalpaid-in capital 192,633 192,276 190,658 0.2 % 1.0 %common stockRetained 62,777 58,335 48,168 7.6 % 30.3 %earningsAccumulatedother (349 ) (205 ) 271 70.2 % -228.8 %comprehensive(loss) incomeTreasury stock, (27,330 ) (26,918 ) (23,335 ) 1.5 % 17.1 %at costTotalStockholders' 253,454 249,211 240,638 1.7 % 5.3 %Equity TotalLiabilities and $ 2,852,460 $ 2,821,016 $ 2,942,003 1.1 % -3.0 %Stockholders'Equity Outstanding 17,121 17,108 17,407 0.1 % -1.6 %common shares

Three Months Ended March 31, 2021 2020 Interest Average Interest Average Average Earned/ Yield/ Average Earned/ Yield/ Balance Paid Rate Balance Paid Rate (3) (3) (Dollars in thousands)Interest-earning assets:Loans Receivable $ 2,326,230 $ 26,863 4.62 % $ 2,185,753 $ 26,814 4.91 %Investment 114,461 990 3.46 % 92,306 571 2.47 %SecuritiesFHLB stock andInterest-earning 264,308 222 0.34 % 580,623 2,034 1.40 %assetsTotalInterest-earning 2,704,999 28,075 4.15 % 2,858,682 29,419 4.12 %assetsNon-interest-earning 109,987 73,509 assetsTotal assets $ 2,814,986 $ 2,932,191 Interest-bearing liabilities:Interest-bearing $ 610,893 $ 757 0.50 % $ 407,339 $ 858 0.84 %demand accountsMoney market 317,151 441 0.56 % 321,233 1,350 1.68 %accountsSavings accounts 302,741 118 0.16 % 259,721 105 0.16 %Certificates of 682,975 1,992 1.17 % 1,120,060 6,432 2.30 %DepositTotalinterest-bearing 1,913,760 3,308 0.69 % 2,108,353 8,745 1.66 %depositsBorrowed funds 205,956 1,205 2.34 % 284,830 1,896 2.66 %Totalinterest-bearing 2,119,716 4,513 0.85 % 2,393,183 10,641 1.78 %liabilitiesNon-interest-bearing 444,787 299,679 liabilitiesTotal 2,564,503 2,692,862 liabilitiesStockholders' equity 250,483 239,329 Totalliabilities and $ 2,814,986 $ 2,932,191 stockholders' equityNet interest income $ 23,562 $ 18,778 Net interest rate 3.30 % 2.34 %spread^(1)Net interest margin^ 3.48 % 2.63 %(2) (1) Net interest rate spread represents the difference between theaverage yield on average interest-earning assets and the average cost ofaverage interest-bearing liabilities.(2) Net interest margin represents net interest income divided byaverage total interest-earning assets.(3) Annualized.

Financial Condition data by quarter Q1 2021 Q4 2020 Q3 2020 Q2 2020 Q1 2020 (In thousands, except book values)Total assets $ 2,852,460 $ 2,821,016 $ 2,842,319 $ 2,986,876 $ 2,942,003 Cash and cash 296,938 261,229 160,551 412,249 595,186 equivalentsSecurities 111,860 117,473 134,144 140,201 97,009 Loansreceivable, 2,296,434 2,295,021 2,391,990 2,343,593 2,164,057 netDeposits 2,404,135 2,318,050 2,273,338 2,442,233 2,375,721 Borrowings 170,399 228,203 296,584 279,726 299,668 Stockholders? 253,454 249,211 242,687 241,019 240,638 equityBook value per $ 13.30 $ 13.06 $ 12.83 $ 12.49 $ 12.40 common share^1Tangible bookvalue per $ 12.99 $ 12.76 $ 12.53 $ 12.18 $ 12.09 common share^2 Operating data by quarter Q1 2021 Q4 2020 Q3 2020 Q2 2020 Q1 2020 (In thousands, except for per share amounts)Net interest $ 23,562 $ 22,751 $ 20,890 $ 17,991 $ 18,778 incomeProvision(credit) for 1,865 1,915 2,726 3,300 1,500 loan lossesNon-interest 1,950 3,744 6,955 1,108 683 incomeNon-interest 13,583 14,378 13,342 11,952 14,364 expenseIncome tax 2,947 2,904 3,465 1,121 1,076 expenseNet income $ 7,117 $ 7,298 $ 8,312 $ 2,726 $ 2,521 Net income per $ 0.40 $ 0.41 $ 0.47 $ 0.14 $ 0.12 diluted shareCommonDividends $ 0.14 $ 0.14 $ 0.14 $ 0.14 $ 0.14 declared pershare Financial Ratios^3 Q1 2021 Q4 2020 Q3 2020 Q2 2020 Q1 2020Return on 1.01 % 1.03 % 1.15 % 0.36 % 0.34 %average assetsReturn onaverage 11.37 % 11.93 % 14.06 % 4.57 % 4.21 %stockholder?sequityNet interest 3.48 % 3.35 % 2.98 % 2.45 % 2.63 %marginStockholder?sequity to 8.89 % 8.83 % 8.54 % 8.07 % 8.18 %total assetsEfficiency 53.24 % 54.27 % 47.92 % 62.58 % 73.81 %Ratio^4 Asset Quality Ratios Q1 2021 Q4 2020 Q3 2020 Q2 2020 Q1 2020 (In thousands, except for ratio %)Non-Accrual $ 14,405 $ 16,396 $ 7,151 $ 4,495 $ 4,362 LoansNon-AccrualLoans as a % 0.62 % 0.70 % 0.29 % 0.19 % 0.20 %of Total LoansALLL as % ofNon-Accrual 246.3 % 205.2 % 444.1 % 641.6 % 585.4 %LoansImpaired Loans 67,344 83,201 31,318 26,839 23,022 Classified 56,178 68,580 18,138 13,584 9,882 Loans (1) Calculated by dividing stockholders' equity to shares outstanding.(2) Calculated by dividing tangible stockholders? common equity, a non-GAAPmeasure, by shares outstanding. Tangible stockholders? common equity isstockholders? equity less goodwill and preferred stock. See ?Reconciliation ofGAAP to Non-GAAP Financial Measures by quarter.?(3) Ratios are presented on an annualized basis, where appropriate.(4) The Efficiency Ratio, a non-GAAP measure, was calculated by dividingnon-interest expense by the total of net interest income and non-interestincome. See ?Reconciliation of GAAP to Non-GAAP Financial Measures by quarter.?

Recorded Investment in Loans Receivable by quarter Q1 2021 Q4 2020 Q3 2020 Q2 2020 Q1 2020 (In thousands)Residentialone-to-four $ 234,375 $ 244,369 $ 241,796 $ 247,471 $ 268,137 familyCommercial and 1,700,113 1,690,836 1,677,668 1,643,954 1,577,816 multi-familyConstruction 167,224 155,967 134,769 111,463 101,692 Commercial 177,340 184,357 311,204 309,284 177,146 businessHome equity 53,360 53,667 60,973 63,481 64,857 Consumer 851 822 770 603 1,029 $ 2,333,263 $ 2,330,018 $ 2,427,180 $ 2,376,256 $ 2,190,677 Less: Deferred (1,352 ) (1,358 ) (3,430 ) (3,821 ) (1,086 )loan fees, netAllowance (35,477 ) (33,639 ) (31,760 ) (28,842 ) (25,534 )for loan loss Total loans, net $ 2,296,434 $ 2,295,021 $ 2,391,990 $ 2,343,593 $ 2,164,057 Non-Accruing Loans in Portfolio by quarter Q1 2021 Q4 2020 Q3 2020 Q2 2020 Q1 2020 (In thousands)Originated loans:Residentialone-to-four $ 701 $ 1,736 $ 1,412 $ 1,332 $ 1,390 familyCommercial and 7,962 8,721 1,436 849 976 multi-familyCommercial 5,307 5,383 3,630 1,642 1,702 businessHome equity 435 556 673 672 294 Total: $ 14,405 $ 16,396 $ 7,151 $ 4,495 $ 4,362

Reconciliation of GAAP to Non-GAAP Financial Measures by quarter Tangible Book Value per Share Q1 2021 Q4 2020 Q3 2020 Q2 2020 Q1 2020 (In thousands, except per share amounts)TotalStockholders' $ 253,454 $ 249,211 $ 242,687 $ 241,019 $ 240,638 EquityLess: 5,253 5,253 5,253 5,253 5,253 goodwillLess:preferred 25,723 25,723 23,481 27,956 24,876 stockTotaltangiblecommon 222,478 218,235 213,953 207,810 210,509 stockholders'equityShares commonshares 17,121 17,108 17,081 17,057 17,407 outstandingBook valueper common $ 13.30 $ 13.06 $ 12.83 $ 12.49 $ 12.40 shareTangible bookvalue per $ 12.99 $ 12.76 $ 12.53 $ 12.18 $ 12.09 common share Efficiency Ratios Q1 2021 Q4 2020 Q3 2020 Q2 2020 Q1 2020 (In thousands, except for ratio %)Net interest $ 23,562 $ 22,751 $ 20,890 $ 17,991 $ 18,778 incomeNon-interest 1,950 3,744 6,955 1,108 683 incomeTotal income 25,512 26,495 27,845 19,099 19,461 Non-interest 13,583 14,378 13,342 11,952 14,364 expenseEfficiency 53.24 % 54.27 % 47.92 % 62.58 % 73.81 %Ratio

Distribution of Deposits by quarter Q1 2021 Q4 2020 Q3 2020 Q2 2020 Q1 2020 (In thousands)Demand: Non-Interest $ 454,061 $ 402,100 $ 395,630 $ 390,912 $ 293,174BearingInterest 620,171 613,882 504,863 472,064 428,683BearingMoney Market 335,440 315,208 311,074 319,113 321,973Sub-total: $ 1,409,672 $ 1,331,190 $ 1,211,567 $ 1,182,089 $ 1,043,830Savings and 311,259 297,765 287,513 275,567 260,291ClubCertificates 683,204 689,095 774,258 984,577 1,071,600of DepositTotal Deposits: $ 2,404,135 $ 2,318,050 $ 2,273,338 $ 2,442,233 $ 2,375,721



Contact: Thomas Coughlin, President & CEO Thomas Keating, CFO (201) 823-0700