GlobeNewswire Inc | Jul 27, 2021 05:00PM EDT

July 27, 2021

UNIONDALE, N.Y., July 27, 2021 (GLOBE NEWSWIRE) -- Flushing Financial Corporation (the Company) (NASDAQ-GS: FFIC)

John R. Buran, President and CEO Commentary

Our successful deposit strategy, the integration of Empire National Bank and the reopening of the New York metro area, resulted in a strong quarter for our Company. Quarterly GAAP EPS of $0.61 resulted in an increase of 2% over the prior quarter. We achieved record core EPS of $0.73, up 103% YoY and 35% QoQ. Importantly, we recognized GAAP ROAA and ROAE of 0.93% and 11.95%, respectively, and record core ROAA and ROAE of 1.11% and 14.27%, respectively.

?We delivered on our strategic objective of optimizing the cost of funds. Thecost of funds decreased four basis points from the prior quarter while theaverage deposit mix continued to improve with both non-interest bearing andcore deposits increasing 8% and 5% (not annualized), respectively. The fifthconsecutive quarter of record net interest income equaled $61.0 million,despite total assets remaining flat. We also performed well against ourstrategic objective to obtain appropriate risk adjusted returns as creditquality improved due to non-performing assets decreasing 17% QoQ.?

- John R. Buran, President and CEO

Empire Exceeding Expectations. The results of the acquisition of Empire National Bank have exceeded our expectations. When the acquisition was announced, tangible book value earn back was modeled at 3.4 years. Our tangible book value per share as of June 30, 2021 totaling $20.51 exceeds the tangible book value per share of $20.22 as of September 30, 2020, the reported value when the deal closed and the tangible book value per share of $19.62 as of September 30, 2019, the reported value when the deal was announced. This accomplishment provided investors with an earn back of 9 months as management actions to achieve targeted cost saves and improved NIM were successful despite the COVID-19 pandemic and subsequent delays.

Strong Capital; Increased Share Repurchase Authorization. The capital ratios increased during the quarter with TCE/TA increasing to 7.80%. The Board of Directors authorized an increase of 1 million shares to our current share repurchase program, which now totals nearly 1.3 million shares and had no expiration. With our history of a low inherent risk business model, low loan to values for our real estate loans along with improved credit metrics, we are confident in our ability to support an increased stock repurchase program.

2Q21 Key Financial Metrics1

2Q21 1Q21 4Q20 3Q20 2Q20GAAP: EPS $ 0.61 $ 0.60 $ 0.11 $ 0.50 $ 0.63ROAA (%) 0.93 0.93 0.18 0.81 1.01ROAE (%) 11.95 12.29 2.27 9.94 13.11NIM FTE (%) 3.14 3.18 3.08 3.00 2.87Core: EPS $ 0.73 $ 0.54 $ 0.58 $ 0.56 $ 0.36ROAA (%) 1.11 0.83 0.92 0.91 0.57ROAE (%) 14.27 10.96 11.67 11.22 7.39Core NIM 3.14 3.06 3.03 2.98 2.89FTE (%)Efficiency 53.4 58.6 57.6 55.4 54.9Ratio (%)Credit Quality:NPAs/Loans& 0.26 0.31 0.31 0.42 0.34REO (%)LLRs/Loans 0.64 0.67 0.67 0.65 0.61(%)LLRs/NPLs 242.55 212.87 214.27 154.66 181.84(%)NCOs/Avg 0.05 0.17 0.04 0.06 0.07Loans (%)Balance Sheet:Avg Loans $ 6.7 $ 6.7 $ 6.4 $ 5.9 $ 5.9($B)Avg Dep $ 6.5 $ 6.3 $ 5.5 $ 5.0 $ 5.0($B)Book Value/ $ 21.16 $ 20.65 $ 20.11 $ 20.78 $ 20.27ShareTangible BV $ 20.51 $ 19.99 $ 19.45 $ 20.22 $ 19.71/ShareTCE/TA (%) 7.80 7.60 7.52 8.10 7.78

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

2Q21 Highlights

-- Record net interest income up 0.2% QoQ and 25.3% YoY to $61.0 million, while core net interest income was up 4.4% QoQ and 24.6% YoY to $61.1 million due to continued improvement in funding costs, increased prepayment penalty income, and net PPP fees -- Net interest margin declined 4 bps QoQ, but rose 27 bps YoY to 3.14%, and core net interest margin was up 8 bps QoQ and 25 bps YoY to 3.14% primarily due to an improvement in funding costs and a rise in prepayment penalty income -- Period end loans, excluding PPP, rose 0.4% QoQ and 10.7% YoY; loan closings were $324.4 million in 2Q21, up 0.5% QoQ and 38.8% YoY -- Average deposits rose 3.6% QoQ and 29.1% YoY to $6.5 billion, with core deposits 84% of total average deposits -- Loan pipeline rose 39.2% YoY to $432.6 million -- Benefit for credit losses of $1.6 million due to an improving economic outlook; strong LTVs, and improving credit metrics; net charge-offs were $0.9 million or 5 bps of average loans in 2Q21 -- NPAs fell 17% QoQ to $17.6 million; criticized and classified assets increased 9.6% to $69.2 million (representing 1.03% of loans) -- Tangible Common Equity to Tangible Assets improved to 7.80% from 7.60% in 1Q21

Income Statement Highlights Y/Y Q/Q($000s, 2Q21 1Q21 4Q20 3Q20 2Q20 Change Changeexcept EPS) Net Interest $ 61,039 $ 60,892 $ 55,732 $ 49,924 $ 48,717 25.3 % 0.2 %Income(Benefit)Provision (1,598 ) 2,820 3,862 2,470 9,619 (116.6 ) (156.7 )for CreditLossesNon-interestIncome (3,210 ) 6,311 (1,181 ) 1,351 13,737 (123.4 ) (150.9 )(Loss)Non-interest 34,011 38,159 46,811 29,985 28,755 18.3 (10.9 )ExpenseIncomeBefore 25,416 26,224 3,878 18,820 24,080 5.5 (3.1 )Income TaxesProvisionfor Income 6,158 7,185 417 4,489 5,808 6.0 (14.3 )TaxesNet Income $ 19,258 $ 19,039 $ 3,461 $ 14,331 $ 18,272 5.4 1.2 Diluted EPS $ 0.61 $ 0.60 $ 0.11 $ 0.50 $ 0.63 (3.2 ) 1.7 Avg. DilutedShares 31,677 31,604 30,603 28,874 28,867 9.7 0.2 (000s) Core Net $ 22,994 $ 16,973 $ 17,784 $ 16,168 $ 10,297 123.3 35.5 Income^1Core EPS^1 $ 0.73 $ 0.54 $ 0.58 $ 0.56 $ 0.36 102.8 35.2

1 See Reconciliation of GAAP Earnings and Core Earnings

Net interest income for 2Q21 was $61.0 million, an increase of 25.3% YoY and 0.2% QoQ.

-- Net interest margin of 3.14%, increased 27 bps YoY, but declined 4 bps QoQ; there was no effect of the PPP loans on the NIM in 2Q21, but there was a drag on the NIM of 4 bps in 1Q21, 3 bps in 4Q20, 2 bps in 3Q20, and 1 bp in 2Q20; net purchase accounting accretion was $0.6 million in 2Q21, $0.9 million in 1Q21 and not meaningful in 4Q20 -- Prepayment penalty income from loans and securities, net reversals and recoveries of interest from non-accrual loans, net gains (losses) from fair value adjustments on qualifying hedges, and purchase accounting accretion totaled $1.8 million (10 bps) in 2Q21, $3.3 million (17 bps) in 1Q21, $2.1 million (11 bps) in 4Q20, $1.7 million (11 bps) in 3Q20, and $0.4 million (2 bps) in 2Q20 -- Excluding these items in the previous bullet, net interest margin improved to 3.04% in 2Q21 from 3.01% in 1Q21, 2.97% in 4Q20, 2.89% in 3Q20, and 2.85% in 2Q20, or an increase of 19 bps YoY and 3 bps QoQ -- Net PPP loan fees were $1.2 million (6 bps NIM impact) in 2Q21, an increase from $0.5 million (3 bps) in 1Q21, $0.4 million (2 bps) in 4Q20, $0.3 million (1 bp) in 3Q20, and $0.1 million (1 bp) in 2Q20

The Company recorded a benefit for creditlosses of $1.6 million in 2Q21, compared to provisions for credit losses of $2.8 million in 1Q21 and $9.6 million in 2Q20.

-- 2Q21 benefit for credit losses was driven by the improving economic outlook supported by the low LTVs and inherent risk in the real estate portfolio -- Net charge-offs were $0.9 million in 2Q21, an improvement from $2.9 million in 1Q21, but roughly stable from the $0.6 million in 4Q20, $0.8 million in 3Q20, and $1.0 million in 2Q20

Non-interest income for 2Q21 was a loss of $3.2 million, compared to income of $6.3 million in 1Q21 and income of $13.7 million in 2Q20.

-- Non-interest income included net gains (losses) from fair value adjustments of $(6.5) million ($(0.15) per share, net of tax) in 2Q21, $1.0 million ($0.02 per share, net of tax) in 1Q21, $(4.1) million ($(0.11) per share, net of tax) in 4Q20, $(2.2) million ($(0.06) per share, net of tax) in 3Q20, and $10.2 million ($0.27 per share, net of tax) in 2Q20 -- Absent all above items and other immaterial adjustments, non-interest income was $3.2 million in 2Q21, up 9.8% YoY, but down 31.7% QoQ as customer swap activity normalized after a strong 1Q21

Non-interest expense was $34.0 million in 2Q21, down from $38.2 million in 1Q21 and $46.8 million in 4Q20, but up from $30.0 million in 3Q20, and $28.8 million in 2Q20.

-- 2Q21 non-interest expense includes $0.5 million of pre-tax merger benefits primarily related to a refund received from a data processing vendor ($(0.01) per share, net of tax) -- 1Q21 non-interest expense includes $1.0 million of pre-tax merger charges ($0.02 per share, net of tax); 1Q21 includes $3.3 million of seasonal compensation expense -- 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) -- Non-interest expense includes merger charges of $0.4 million in 3Q20 and $0.2 million in 2Q20 ($0.01 per share, net of tax, for each period) -- Excluding the above items and other and immaterial adjustments, core operating expenses were $34.4 million in 2Q21, up 20.3% YoY, but down 7.3% QoQ -- The efficiency ratio improved to 53.4% in 2Q21, from 58.6% in 1Q21, 57.6% in 4Q20, 55.4% in 3Q20, and 54.9% in 2Q20

The provision for income taxes was $6.2 million in 2Q21, $7.2 million in 1Q21, $0.4 million in 4Q20, $4.5 million in 3Q20, and $5.8 million in 2Q20.

-- The effective tax rate was 24.2% in 2Q21, 27.4% in 1Q21, 10.8% in 4Q20, 23.9% in 3Q20, and 24.1% in 2Q20 -- The 2Q21 effective tax rate includes $0.8 million benefit for the state rate change; absent this benefit the effective tax rate would have been 27.2%

Balance Sheet, Credit Quality, and Capital Highlights Y/Y Q/Q($000s,except per 2Q21 1Q21 4Q20 3Q20 2Q20 Change Changeshare data)Average Loans And DepositsLoans $ 6,687 $ 6,700 $ 6,376 $ 5,904 $ 5,946 12.5 % (0.2 )%Deposits 6,511 6,285 5,515 4,999 5,043 29.1 3.6 Credit QualityNonperforming $ 17,592 $ 21,186 $ 21,073 $ 24,792 $ 20,188 (12.9 )% (17.0 )%LoansNonperforming 17,592 21,221 21,108 24,827 20,431 (13.9 ) (17.1 )AssetsCriticizedand 69,161 63,130 71,691 42,181 48,712 42.0 9.6 ClassifiedAssetsAllowance forCredit Losses 0.64 0.67 0.67 0.65 0.61 3 bps (3 )bps/Loans (%) Capital Book Value/ $ 21.16 $ 20.65 $ 20.11 $ 20.78 $ 20.27 4.4 % 2.5 %ShareTangible Book 20.51 19.99 19.45 20.22 19.71 4.1 2.6 Value/ShareTang. CommonEquity/Tang. 7.80 7.60 7.52 8.10 7.78 2 bps 20 bpsAssets (%)Leverage 8.50 8.44 8.38 9.03 8.64 (14 ) 6 Ratio (%)

Average loans were $6.7 billion, an increase of 12.5% YoY, but a decline of 0.2% QoQ.

-- Total loan closings rose to $324.4 million in 2Q21, compared to $322.9 million in 1Q21, $316.0 million in 4Q20, $155.6 million in 3Q20, and $233.8 million in 2Q20 -- The loan pipeline increased to $432.6 million at June 30, 2021, compared to $310.8 million a year ago -- SBA Paycheck Protection Program (PPP) loans were $197.3 million at 2Q21, $251.0 million at 1Q21, $151.9 million at 4Q20, $111.6 million at 3Q20, and $93.2 million at 2Q20; forgiven PPP loans were $69.2 million in 2Q21 compared to $24.1 million in 1Q21; the SBA has up to 90 days to process forgiveness; remaining unamortized net PPP fees were $4.4 million

Average Deposits totaled $6.5 billion, rising 29.1% YoY and 3.6% QoQ.

-- Average core deposits (non-CD deposits) rose to 84.0% of total average deposits (including escrow deposits) in 2Q21, compared to 76.5% a year ago

Credit Quality; Non-performing loans declined to $17.6 million in 2Q21, compared to $21.2 million in 1Q21 and $20.4 million in 2Q20.

-- Non-performing assets totaled $17.6 million, down 17.1% QoQ, and 13.9% YoY -- Criticized and classified assets totaled $69.2 million at 2Q21, $63.1 million at 1Q21, $71.7 million at 4Q20, $42.2 million at 3Q20, and $48.7 million at 2Q20; the QoQ increase was primarily due to a rise in watch list loans; partially offset by a decline in classified loans -- Loans classified as troubled debt restructured (TDR) totaled $15.5 million versus $15.2 million at 1Q21 and $6.0 million a year ago -- Active COVID-19 forbearances totaled 69 loans with a principal balance of $245.8 million at June 30, 2021, with $163.3 million making interest payments and only $82.5 million (1.2% of loans) with full payment deferrals -- Over 85% of gross loans are collateralized by real estate and these loans have a loan-to-value ratio of 38% as of June 30, 2021 -- Allowance for credit losses were 0.64% of loans at 2Q21 compared to 0.67% of loans at 1Q21 and 0.61% a year ago

Capital; Book value per common share increased to $21.16 at 2Q21, versus $20.65 at 1Q21 and $20.27 at 2Q20; tangible book value per common share, a non-GAAP measure, rose to $20.51 at 2Q21, compared to $19.99 at 1Q21 and $19.71 in 2Q20.

-- The Company paid a dividend of $0.21 per share in 2Q21 and did not repurchase any shares in the quarter -- The Board of Directors increased the share repurchase authorization by 1 million shares; up to 1,284,806 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 7.80% at 2Q21 compared to 7.78% a year ago -- The Company and the Bank remain well capitalized under all applicable regulatory requirements -- The leverage ratio was 8.50% in 2Q21 versus 8.64% in 2Q20

Conference Call Information And Third Quarter Earnings Release Date

Conference Call Information:

-- John R. Buran, President and Chief Executive Officer, and Susan K. Cullen, Senior Executive Vice President and Chief Financial Officer, will host a conference call tomorrow, Wednesday, July 28, 2021, at 9:30 AM (ET) to discuss the Companys second quarter 2021 results and strategy. -- Dial-in for Live Call: 1-877-509-5836 -- Webcast: https://services.choruscall.com/links/ffic210728.html -- Dial-in for Replay: 1-877-344-7529 -- Replay Access Code: 10151629 -- The conference call will be simultaneously webcastand archived through July 28, 2022.

Third Quarter 2021 Earnings Release Date:

The Company plans to release Third Quarter 2021 financial results after the market close on October 26, 2021; conference call at 9:30 AM (ET) on October 27, 2021.

A detailed announcement will be issued prior to the third quarters close confirming the date and time of the earnings release.

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 Banks 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 Companys website at http://www.flushingbank.com. Flushing Financial Corporations earnings release and presentation slides will be available prior to the conference call at www.flushingbank.com under Investor Relations.

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

Investor Contact: Susan K. Cullen, SEVP, CFO and Treasurer, 718-961-5400

-Statistical Tables Follow-

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIESFINANCIAL HIGHLIGHTS(Unaudited)

At or for the three months ended At or for the six months ended June30, March 31, December 31, September 30, June30, June30, June30,(Dollars inthousands, except 2021 2021 2020 2020 2020 2021 2020per share data)Performance Ratios ^(1)Return on average 0.93 % 0.93 % 0.18 % 0.81 % 1.01 % 0.93 % 0.47 %assetsReturn on average 11.95 12.29 2.27 9.94 13.11 12.11 5.95 equityYield on averageinterest-earning 3.69 3.77 3.82 3.84 3.81 3.73 3.89 assets ^(2)Cost of averageinterest-bearing 0.66 0.69 0.86 0.98 1.09 0.67 1.41 liabilitiesCost of funds 0.57 0.61 0.77 0.89 0.99 0.59 1.30 Net interest ratespread during 3.03 3.08 2.96 2.86 2.72 3.06 2.48 period^ (2)Net interest margin 3.14 3.18 3.08 3.00 2.87 3.16 2.66 ^(2)Non-interestexpense to average 1.65 1.87 2.43 1.69 1.60 1.76 1.71 assetsEfficiency ratio ^ 53.38 58.58 57.56 55.37 54.92 55.96 61.16 (3)Averageinterest-earningassets to average 1.19 X 1.18 X 1.17 X 1.16 X 1.15 X 1.19 X 1.14 Xinterest-bearingliabilities Average Balances Total loans, net $ 6,686,888 $ 6,700,476 $ 6,375,516 $ 5,904,051 $ 5,946,412 $ 6,693,644 $ 5,870,640 Totalinterest-earning 7,790,174 7,667,217 7,243,472 6,675,896 6,809,835 7,729,035 6,764,846 assetsTotal assets 8,263,553 8,147,714 7,705,407 7,083,028 7,206,059 8,205,954 7,156,529 Total due to 5,495,936 5,363,647 4,708,760 4,353,560 4,395,228 5,430,158 4,487,011 depositorsTotalinterest-bearing 6,532,891 6,477,871 6,169,574 5,731,899 5,912,774 6,505,534 5,932,350 liabilitiesStockholders' 644,690 619,647 609,463 576,512 557,414 632,238 567,006 equity Per Share Data Book value per $ 21.16 $ 20.65 $ 20.11 $ 20.78 $ 20.27 $ 21.16 $ 20.27 common share ^(4)Tangible book valueper common share ^ $ 20.51 $ 19.99 $ 19.45 $ 20.22 $ 19.71 $ 20.51 $ 19.71 (5) Stockholders' EquityStockholders' $ 655,167 $ 639,201 $ 618,997 $ 586,406 $ 571,921 $ 655,167 $ 571,921 equityTangiblestockholders' 634,959 618,839 598,476 570,571 556,086 634,959 556,086 equity ConsolidatedRegulatory Capital RatiosTier 1 capital $ 697,591 $ 679,343 $ 662,987 $ 630,380 $ 617,620 $ 697,591 $ 617,620 Common equity Tier 649,367 636,071 621,247 593,344 583,238 649,367 583,238 1 capitalTotal risk-based 823,494 806,922 794,034 740,499 726,291 823,494 726,291 capitalRisk Weighted 6,344,076 6,281,136 6,287,598 5,381,938 5,406,014 6,344,076 5,406,104 Assets Tier 1 leveragecapital (well 8.50 % 8.44 % 8.38 % 9.03 % 8.64 % 8.50 % 8.64 %capitalized = 5%)Common equity Tier1 risk-based 10.24 10.13 9.88 11.02 10.79 10.24 10.79 capital (wellcapitalized = 6.5%)Tier 1 risk-basedcapital (well 11.00 10.82 10.54 11.71 11.42 11.00 11.42 capitalized = 8.0%)Total risk-basedcapital (well 12.98 12.85 12.63 13.76 13.43 12.98 13.43 capitalized =10.0%) Capital Ratios Average equity to 7.80 % 7.61 % 7.91 % 8.14 % 7.74 % 7.70 % 7.92 %average assetsEquity to total 8.03 7.83 7.76 8.30 7.98 8.03 7.98 assetsTangible commonequity to tangible 7.80 7.60 7.52 8.10 7.78 7.80 7.78 assets ^(6) Asset Quality Non-accrual loans ^ $ 17,391 $ 18,604 $ 18,325 $ 24,792 $ 20,038 $ 17,391 $ 20,038 (7)Non-performing 17,592 21,186 21,073 24,792 20,188 17,592 20,188 loansNon-performing 17,592 21,221 21,108 24,827 20,431 17,592 20,431 assetsNet charge-offs 902 2,865 646 837 1,007 3,767 2,156 Asset Quality RatiosNon-performingloans to gross 0.26 % 0.31 % 0.31 % 0.42 % 0.34 % 0.26 % 0.34 %loansNon-performingassets to total 0.22 0.26 0.26 0.35 0.29 0.22 0.29 assetsAllowance for loanlosses to gross 0.64 0.67 0.67 0.65 0.61 0.64 0.61 loansAllowance for loanlosses to 242.55 212.52 213.91 154.44 179.68 242.55 179.68 non-performingassetsAllowance for loanlosses to 242.55 212.87 214.27 154.66 181.84 242.55 181.84 non-performingloansNet charge-offs to 0.05 0.17 0.04 0.06 0.07 0.11 0.07 average loans Full-service 25 25 25 20 20 25 20 customer facilities

(See footnotes on next page)

(1)Ratios are presented on an annualized basis, where appropriate.(2)Yields are calculated on the tax equivalent basis using the statutory federal income tax rate of 21% for the periods presented.(3) Efficiency ratio, a non-GAAP measure, was calculated by dividing non-interest expense (excluding merger expense, OREO expense, prepayment penalty on borrowings, the net gain/loss from the sale of OREO and net amortization of purchase accounting adjustments) by the total of net interest income (excluding net gains and losses from fair value adjustments on qualifying hedges and net amortization of purchase accounting adjustments) and non-interest income (excluding life insurance proceeds, net gains and losses from the sale or disposition of securities, assets and fair value adjustments).(4)Calculated by dividing stockholders equity by shares outstanding.(5)Calculated by dividing tangible stockholders common equity, a non-GAAP measure, by shares outstanding. Tangible stockholders common equity is stockholders equity less intangible assets (goodwill, net of deferred taxes). See Calculation of Tangible Stockholders Common Equity to Tangible Assets.(6)See Calculation of Tangible Stockholders Common Equity to Tangible Assets.(7)Excludes performing non-accrual TDR loans.

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIESCONSOLIDATED STATEMENTS OF INCOME (Unaudited)

For the three months ended For the six months ended June30, March 31, December September June30, June30, June30, 31, 30,(Inthousands, 2021 2021 2020 2020 2020 2021 2020except pershare data)Interest andDividend IncomeInterest andfees on $ 67,999 $ 69,021 $ 66,120 $ 60,367 $ 60,557 $ 137,020 $ 121,666 loansInterest anddividends on securities:Interest 3,685 3,072 2,813 3,525 4,182 6,757 9,438 Dividends 7 8 8 9 11 15 26 Otherinterest 51 36 30 13 22 87 312 incomeTotalinterest and 71,742 72,137 68,971 63,914 64,772 143,879 131,442 dividendincome Interest ExpenseDeposits 5,539 6,105 6,470 7,093 9,971 11,644 28,749 Otherinterest 5,164 5,140 6,769 6,897 6,084 10,304 13,150 expenseTotalinterest 10,703 11,245 13,239 13,990 16,055 21,948 41,899 expense Net Interest 61,039 60,892 55,732 49,924 48,717 121,931 89,543 Income(Benefit)provision (1,598 ) 2,820 3,862 2,470 9,619 1,222 16,797 for creditlossesNet InterestIncome After(Benefit) 62,637 58,072 51,870 47,454 39,098 120,709 72,746 Provisionfor CreditLosses Non-interestIncome (loss)Bankingservices fee 1,233 2,725 1,442 1,316 944 3,958 1,742 incomeNet gain(loss) on 123 ? (610 ) ? (54 ) 123 (91 )sale ofsecuritiesNet gain onsale of 127 31 6 ? ? 158 42 loansNet gain ondisposition ? 621 ? ? ? 621 ? of assetsNet gain(loss) from (6,548 ) 982 (4,129 ) (2,225 ) 10,205 (5,566 ) 4,212 fair valueadjustmentsFederal HomeLoan Bank ofNew York 500 689 734 874 881 1,189 1,845 stockdividendsLifeinsurance ? ? ? ? 659 ? 659 proceedsBank ownedlife 1,009 997 1,016 923 932 2,006 1,875 insuranceOther income 346 266 360 463 170 612 589 Totalnon-interest (3,210 ) 6,311 (1,181 ) 1,351 13,737 3,101 10,873 income(loss) Non-interest ExpenseSalaries andemployee 19,879 22,664 22,089 17,335 16,184 42,543 34,804 benefitsOccupancyand 3,522 3,367 3,446 3,021 2,827 6,889 5,667 equipmentProfessional 1,988 2,400 2,463 2,064 1,985 4,388 4,847 servicesFDIC deposit 729 1,213 562 727 737 1,942 1,387 insuranceData 1,419 2,109 3,411 1,668 1,813 3,528 3,507 processingDepreciationand 1,638 1,639 1,579 1,542 1,555 3,277 3,091 amortizationOther realestate owned/foreclosure 22 (10 ) 95 240 45 12 (119 )(recoveries)expensePrepaymentpenalty on ? ? 7,834 ? ? ? ? borrowingsOtheroperating 4,814 4,777 5,332 3,388 3,609 9,591 7,951 expensesTotalnon-interest 34,011 38,159 46,811 29,985 28,755 72,170 61,135 expense IncomeBefore 25,416 26,224 3,878 18,820 24,080 51,640 22,484 Income Taxes Provision(benefit) for IncomeTaxesFederal 4,857 5,071 533 3,359 4,307 9,928 5,296 State and 1,301 2,114 (116 ) 1,130 1,501 3,415 306 localTotal taxes 6,158 7,185 417 4,489 5,808 13,343 5,602 Net Income $ 19,258 $ 19,039 $ 3,461 $ 14,331 $ 18,272 $ 38,297 $ 16,882 Basicearnings per $ 0.61 $ 0.60 $ 0.11 $ 0.50 $ 0.63 $ 1.21 $ 0.58 common shareDilutedearnings per $ 0.61 $ 0.60 $ 0.11 $ 0.50 $ 0.63 $ 1.21 $ 0.58 common shareDividendsper common $ 0.21 $ 0.21 $ 0.21 $ 0.21 $ 0.21 $ 0.42 $ 0.42 share Basicaverage 31,677 31,604 30,603 28,874 28,867 31,641 28,860 sharesDilutedaverage 31,677 31,604 30,603 28,874 28,867 31,641 28,860 shares

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIESCONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (Unaudited)

June30, March 31, December 31, September 30, June30,(Dollars in 2021 2021 2020 2020 2020thousands)ASSETS Cash and due from $ 145,971 $ 174,420 $ 157,388 $ 75,560 $ 84,754 banksSecurities held-to-maturity:Mortgage-backed 7,904 7,909 7,914 7,919 7,924 securitiesOther securities 49,986 49,912 49,918 50,252 50,078 Securitiesavailable for sale:Mortgage-backed 596,661 518,781 404,460 386,235 442,507 securitiesOther securities 224,784 242,440 243,514 234,721 232,803 Loans 6,718,806 6,745,316 6,704,674 5,941,398 5,983,275 Allowance for (42,670 ) (45,099 ) (45,153 ) (38,343 ) (36,710 )loan lossesNet loans 6,676,136 6,700,217 6,659,521 5,903,055 5,946,565 Interest anddividends 43,803 44,941 44,041 36,068 30,219 receivableBank premises and 26,438 27,498 28,179 25,766 27,018 equipment, netFederal Home LoanBank of New York 41,630 41,498 43,439 57,119 56,400 stockBank owned life 183,715 182,707 181,710 158,701 157,779 insuranceGoodwill 17,636 17,636 17,636 16,127 16,127 Core deposit 2,859 3,013 3,172 ? ? intangiblesRight of use 51,972 53,802 50,743 42,326 38,303 assetOther assets 89,850 94,410 84,759 69,207 72,182 Total assets $ 8,159,345 $ 8,159,184 $ 7,976,394 $ 7,063,056 $ 7,162,659 LIABILITIES Deposits $ 6,298,790 $ 6,326,577 $ 6,090,733 $ 4,906,359 $ 5,049,874 Mortgagors' 58,230 74,348 45,622 57,136 48,525 escrow depositsBorrowed funds 971,827 948,920 1,020,895 1,323,975 1,305,187 Operating lease 56,151 58,080 59,100 49,737 45,897 liabilityOther liabilities 119,180 112,058 141,047 139,443 141,255 Total liabilities 7,504,178 7,519,983 7,357,397 6,476,650 6,590,738 STOCKHOLDERS' EQUITYPreferred stock(5,000,000 shares ? ? ? ? ? authorized; noneissued)Common stock($0.01 par value;100,000,000 341 341 341 315 315 sharesauthorized)Additional 260,958 260,019 261,533 227,877 226,901 paid-in capitalTreasury stock (65,335 ) (65,479 ) (69,400 ) (69,409 ) (69,436 )Retained earnings 467,620 455,023 442,789 445,931 437,663 Accumulated othercomprehensive (8,417 ) (10,703 ) (16,266 ) (18,308 ) (23,522 )loss, net oftaxesTotalstockholders' 655,167 639,201 618,997 586,406 571,921 equity Total liabilitiesand stockholders' $ 8,159,345 $ 8,159,184 $ 7,976,394 $ 7,063,056 $ 7,162,659 equity (In thousands) Issued shares 34,088 34,088 34,088 31,531 31,531 Outstanding 30,962 30,954 30,776 28,218 28,217 sharesTreasury shares 3,126 3,133 3,312 3,312 3,313



FLUSHING FINANCIAL CORPORATION and SUBSIDIARIESAVERAGE BALANCE SHEETS (Unaudited)

For the three months ended For the six months ended June30, March 31, December 31, September June30, June30, June30, 30,(In thousands) 2021 2021 2020 2020 2020 2021 2020Interest-earning Assets:Mortgage loans, $ 5,130,400 $ 5,155,975 $ 5,010,097 $ 4,721,742 $ 4,762,068 $ 5,143,117 $ 4,729,800netOther loans, net 1,556,488 1,544,501 1,365,419 1,182,309 1,184,344 1,550,527 1,140,840Total loans, net 6,686,888 6,700,476 6,375,516 5,904,051 5,946,412 6,693,644 5,870,640Taxable securities:Mortgage-backed 578,134 433,917 413,875 413,902 465,365 506,424 486,638securitiesOther securities 232,020 300,828 266,663 243,754 243,867 266,234 243,796Total taxable 810,154 734,745 680,538 657,656 709,232 772,658 730,434securitiesTax-exempt securities:Other securities 50,830 50,828 50,768 51,652 60,280 50,829 61,908Total tax-exempt 50,830 50,828 50,768 51,652 60,280 50,829 61,908securitiesInterest-earningdeposits and 242,302 181,168 136,650 62,537 93,911 211,904 101,864federal fundssoldTotalinterest-earning 7,790,174 7,667,217 7,243,472 6,675,896 6,809,835 7,729,035 6,764,846assetsOther assets 473,379 480,497 461,935 407,132 396,224 476,919 391,683Total assets $ 8,263,553 $ 8,147,714 $ 7,705,407 $ 7,083,028 $ 7,206,059 $ 8,205,954 $ 7,156,529 Interest-bearing Liabilities:Deposits: Savings accounts $ 153,113 $ 170,079 $ 163,382 $ 160,100 $ 188,587 $ 161,549 $ 191,307NOW accounts 2,255,581 2,185,384 1,924,840 1,625,109 1,440,147 2,220,677 1,429,943Money market 2,043,257 1,905,543 1,507,245 1,461,996 1,580,652 1,974,781 1,639,217accountsCertificate of 1,043,985 1,102,641 1,113,293 1,106,355 1,185,842 1,073,151 1,226,544deposit accountsTotal due to 5,495,936 5,363,647 4,708,760 4,353,560 4,395,228 5,430,158 4,487,011depositorsMortgagors' 91,545 65,372 75,005 55,868 87,058 78,531 76,281escrow accountsTotalinterest-bearing 5,587,481 5,429,019 4,783,765 4,409,428 4,482,286 5,508,689 4,563,292depositsBorrowings 945,410 1,048,852 1,385,809 1,322,471 1,430,488 996,845 1,369,058Totalinterest-bearing 6,532,891 6,477,871 6,169,574 5,731,899 5,912,774 6,505,534 5,932,350liabilitiesNoninterest-bearing 923,220 856,052 731,170 589,674 560,637 889,821 505,199demand depositsOther 162,752 194,144 195,200 184,943 175,234 178,361 151,974liabilitiesTotal 7,618,863 7,528,067 7,095,944 6,506,516 6,648,645 7,573,716 6,589,523liabilitiesEquity 644,690 619,647 609,463 576,512 557,414 632,238 567,006Totalliabilities and $ 8,263,553 $ 8,147,714 $ 7,705,407 $ 7,083,028 $ 7,206,059 $ 8,205,954 $ 7,156,529equity Netinterest-earning $ 1,257,283 $ 1,189,346 $ 1,073,898 $ 943,997 $ 897,061 $ 1,223,501 $ 832,496assets

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIESNET INTEREST INCOME AND NET INTEREST MARGIN (Unaudited)

For the three months ended For the six months ended June30, March 31, December 31, September June30, June30, June30, 30,(Dollars in 2021 2021 2020 2020 2020 2021 2020thousands)Interest Income: Mortgage loans, $ 52,987 $ 55,219 $ 53,777 $ 49,814 $ 49,719 $ 108,206 $ 99,131 netOther loans, net 15,012 13,802 12,343 10,553 10,838 28,814 22,535 Total loans, net 67,999 69,021 66,120 60,367 60,557 137,020 121,666 Taxable securities:Mortgage-backed 2,233 1,698 1,435 1,928 2,327 3,931 5,367 securitiesOther securities 1,037 963 957 1,166 1,358 2,000 3,055 Total taxable 3,270 2,661 2,392 3,094 3,685 5,931 8,422 securitiesTax-exempt securities:Other securities 535 530 543 557 643 1,065 1,319 Total tax-exempt 535 530 543 557 643 1,065 1,319 securitiesInterest-earningdeposits and 51 36 30 13 22 87 312 federal fundssoldTotalinterest-earning 71,855 72,248 69,085 64,031 64,907 144,103 131,719 assetsInterest Expense:Deposits: Savings accounts $ 66 $ 75 $ 75 $ 65 $ 74 $ 141 $ 355 NOW accounts 1,499 1,706 1,320 1,242 2,099 3,205 6,747 Money market 2,060 2,100 2,010 2,108 3,208 4,160 10,250 accountsCertificate of 1,913 2,222 3,065 3,700 4,564 4,135 11,331 deposit accountsTotal due to 5,538 6,103 6,470 7,115 9,945 11,641 28,683 depositorsMortgagors' 1 2 ? (22 ) 26 3 66 escrow accountsTotalinterest-bearing 5,539 6,105 6,470 7,093 9,971 11,644 28,749 depositsBorrowings 5,164 5,140 6,769 6,897 6,084 10,304 13,150 Totalinterest-bearing 10,703 11,245 13,239 13,990 16,055 21,948 41,899 liabilitiesNet interestincome- tax $ 61,152 $ 61,003 $ 55,846 $ 50,041 $ 48,852 $ 122,155 $ 89,820 equivalentIncluded in netinterest income above:Prepaymentpenaltiesreceived onloans andsecurities and $ 2,046 $ 947 $ 1,093 $ 1,518 $ 776 $ 2,993 $ 1,965 net of reversalsand recoveredinterest fromnon-accrualloansNet gains/(losses) fromfair valueadjustments on (664 ) 1,427 1,023 230 (365 ) 763 (2,438 )qualifyinghedges includedin loan interestincomePurchaseaccounting 565 922 11 ? ? 1,487 ? adjustmentsInterest-earning Assets Yields:Mortgage loans, 4.13 % 4.28 % 4.29 % 4.22 % 4.18 % 4.21 % 4.19 %netOther loans, net 3.86 3.57 3.62 3.57 3.66 3.72 3.95 Total loans, net 4.07 4.12 4.15 4.09 4.07 4.09 4.14 Taxable securities:Mortgage-backed 1.54 1.57 1.39 1.86 2.00 1.55 2.21 securitiesOther securities 1.79 1.28 1.44 1.91 2.23 1.50 2.51 Total taxable 1.61 1.45 1.41 1.88 2.08 1.54 2.31 securitiesTax-exempt securities: ^(1)Other securities 4.21 4.17 4.28 4.31 4.27 4.19 4.26 Total tax-exempt 4.21 4.17 4.28 4.31 4.27 4.19 4.26 securitiesInterest-earningdeposits and 0.08 0.08 0.09 0.08 0.09 0.08 0.61 federal fundssoldTotalinterest-earning 3.69 % 3.77 % 3.82 % 3.84 % 3.81 % 3.73 % 3.89 %assetsInterest-bearingLiabilities Yields:Deposits: Savings accounts 0.17 % 0.18 % 0.18 % 0.16 % 0.16 % 0.17 % 0.37 %NOW accounts 0.27 0.31 0.27 0.31 0.58 0.29 0.94 Money market 0.40 0.44 0.53 0.58 0.81 0.42 1.25 accountsCertificate of 0.73 0.81 1.10 1.34 1.54 0.77 1.85 deposit accountsTotal due to 0.40 0.46 0.55 0.65 0.91 0.43 1.28 depositorsMortgagors' ? 0.01 ? (0.16 ) 0.12 0.01 0.17 escrow accountsTotalinterest-bearing 0.40 0.45 0.54 0.64 0.89 0.42 1.26 depositsBorrowings 2.18 1.96 1.95 2.09 1.70 2.07 1.92 Totalinterest-bearing 0.66 % 0.69 % 0.86 % 0.98 % 1.09 % 0.67 % 1.41 %liabilities Net interestrate spread (tax 3.03 % 3.08 % 2.96 % 2.86 % 2.72 % 3.06 % 2.48 %equivalent)Net interestmargin (tax 3.14 % 3.18 % 3.08 % 3.00 % 2.87 % 3.16 % 2.66 %equivalent)Ratio ofinterest-earningassets to 1.19 X 1.18 X 1.17 X 1.16 X 1.15 X 1.19 X 1.14 Xinterest-bearingliabilities

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

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIESDEPOSIT and LOAN COMPOSITION(Unaudited)

Deposit Composition

June 2021 June 2021 vs. vs. June30, March 31, December 31, September 30, June30, March2021 June 2020(Dollars in 2021 2021 2020 2020 2020 % Change % Changethousands)Non-interest $ 945,491 $ 917,189 $ 778,672 $ 607,954 $ 581,881 3.1 % 62.5 %bearingInterest bearing:Certificate of 1,020,615 1,070,595 1,138,361 1,051,644 1,135,977 (4.7 ) (10.2 )deposit accountsSavings accounts 152,931 170,272 168,183 160,294 184,895 (10.2 ) (17.3 )Money market 2,057,188 1,990,656 1,682,345 1,381,552 1,474,880 3.3 39.5 accountsNOW accounts 2,122,565 2,177,865 2,323,172 1,704,915 1,672,241 (2.5 ) 26.9 Totalinterest-bearing 5,353,299 5,409,388 5,312,061 4,298,405 4,467,993 (1.0 ) 19.8 depositsTotal deposits $ 6,298,790 $ 6,326,577 $ 6,090,733 $ 4,906,359 $ 5,049,874 (0.4 )% 24.7 %

Loan Composition

June 2021 June 2021 vs. vs. June30, March 31, December 31, September 30, June30, March2021 June 2020(Dollars in 2021 2021 2020 2020 2020 % Change % Changethousands)Multi-family $ 2,542,010 $ 2,525,967 $ 2,533,952 $ 2,252,757 $ 2,285,555 0.6 % 11.2 %residentialCommercial 1,726,895 1,721,702 1,754,754 1,636,659 1,646,085 0.3 4.9 real estateOne-to-fourfamily ? 582,211 595,431 602,981 585,159 591,347 (2.2 ) (1.5 )mixed-usepropertyOne-to-fourfamily ? 288,652 239,391 245,211 191,011 184,741 20.6 56.2 residentialCo-operative 7,883 7,965 8,051 8,132 8,423 (1.0 ) (6.4 )apartmentsConstruction 62,802 61,528 83,322 63,567 69,433 2.1 (9.6 )Mortgage Loans 5,210,453 5,151,984 5,228,271 4,737,285 4,785,584 1.1 8.9 Small BusinessAdministration 215,158 267,120 167,376 124,649 106,813 (19.5 ) 101.4 ^ (1)Taxi medallion ? ? 2,757 2,317 3,269 ? (100.0 )Commercialbusiness and 1,291,526 1,326,657 1,303,225 1,063,429 1,073,623 (2.6 ) 20.3 otherNon-mortgage 1,506,684 1,593,777 1,473,358 1,190,395 1,183,705 (5.5 ) 27.3 loans Netunamortizedpremiums and 1,669 (445 ) 3,045 13,718 13,986 (475.1 ) (88.1 )unearned loanfees ^(2)Allowance for (42,670 ) (45,099 ) (45,153 ) (38,343 ) (36,710 ) (5.4 ) 16.2 loan lossesNet loans $ 6,676,136 $ 6,700,217 $ 6,659,521 $ 5,903,055 $ 5,946,565 (0.4 )% 12.3 %



(1) Includes $197.3 million, $251.0 million, $151.9 million, $111.6 million and $93.2 million of PPP loans at June 30, 2021, March, 31, 2021, December 31, 2020, September 30, 2020 and June 30, 2020, respectively.(2) Includes $8.3 million, $10.5 million and $11.3 million of purchase accounting unamortized discount resulting from the acquisition of Empire Bancorp at June 30, 2021, March 31, 2021 and December 31, 2020, respectively.

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIESLOAN CLOSINGS and RATES (Unaudited)

Loan Closings

For the three months ended For the six months ended June30, March 31, December September June30, June30, June30, 31, 30,(In thousands) 2021 2021 2020 2020 2020 2021 2020Multi-family $ 66,913 $ 58,553 $ 52,024 $ 33,733 $ 59,654 $ 125,466 $ 126,972residentialCommercial 37,963 17,156 57,634 26,644 8,003 55,119 107,574real estateOne-to-fourfamily ? 7,135 8,712 9,692 3,867 8,117 15,847 21,572mixed-usepropertyOne-to-fourfamily ? 59,494 3,131 8,422 2,296 2,674 62,625 11,087residentialCo-operative ? ? ? ? ? ? 704apartmentsConstruction 5,281 7,123 6,869 5,420 2,821 12,404 9,570Mortgage Loans 176,786 94,675 134,641 71,960 81,269 271,461 277,479 Small BusinessAdministration 17,585 125,093 598 18,456 93,241 142,678 93,298^ (1)Commercialbusiness and 130,036 103,118 180,787 65,160 59,287 233,154 161,735otherNon-mortgage 147,621 228,211 181,385 83,616 152,528 375,832 255,033Loans Total $ 324,407 $ 322,886 $ 316,026 $ 155,576 $ 233,797 $ 647,293 $ 532,512



(1) Includes $15.5 million, $123.2 million, $18.4 million and $93.2 million of PPP closings for the three months ended June 30, 2021, March 31, 2021, September 30, 2020, and June 30, 2020, respectively.

Weighted Average Rate on Loan Closings

For the three months ended June30, March 31, December September June30, 31, 30,Loan type 2021 2021 2020 2020 2020Mortgage 3.53 % 3.47 % 3.47 % 3.56 % 3.79 %loansNon-mortgage 3.23 2.26 3.37 2.81 1.99 loansTotal loans 3.39 % 2.62 % 3.41 % 3.16 % 2.62 % Excluding 3.51 % 3.62 % 3.41 % 3.45 % 3.71 %PPP loans

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIESASSET QUALITY(Unaudited)Allowance for Loan Losses

For the Three Months Ended For the six months ended June30, March 31, December September June30, June30, June30, 31, 30,(Dollars in 2021 2021 2020 2020 2020 2021 2020thousands)Allowance for loan lossesBeginning $ 45,099 $ 45,153 $ 38,343 $ 36,710 $ 28,098 45,153 21,751 balancesAdoption ofCurrent ? ? ? ? ? ? 379 ExpectedCredit Losses Multi-family ? 33 (11 ) (14 ) (7 ) $ 33 $ (13 )residentialCommercial ? 64 ? ? ? 64 ? real estateOne-to-fourfamily ? 3 19 ? (60 ) 3 22 (75 )mixed-usepropertyOne-to-fourfamily ? (2 ) (5 ) (2 ) (2 ) (3 ) (7 ) (8 )residentialSmall Business (9 ) (10 ) (3 ) (47 ) 165 (19 ) 158 AdministrationTaxi medallion (222 ) 2,758 124 951 ? 2,536 ? Commercialbusiness and 1,132 6 538 9 849 1,138 2,094 otherTotal net loan 902 2,865 646 837 1,007 3,767 2,156 charge-offs (Benefit)provision for (1,527 ) 2,811 3,357 2,470 9,619 1,284 16,736 loan lossesAllowancerecorded at ? ? 4,099 ? ? ? ? the time ofAcquisition Ending balance $ 42,670 $ 45,099 $ 45,153 $ 38,343 $ 36,710 $ 42,670 $ 36,710 Gross $ 1,186 $ 2,922 $ 752 $ 964 $ 1,030 $ 4,108 $ 2,289 charge-offsGross 284 57 106 127 23 341 133 recoveries Allowance forloan losses to 0.64 % 0.67 % 0.67 % 0.65 % 0.61 % 0.64 % 0.61 %gross loansNet loancharge-offs to 0.05 0.17 0.04 0.06 0.07 0.11 0.07 average loans

Non-Performing Assets

June30, March 31, December 31, September June30, 30,(Dollars in 2021 2021 2020 2020 2020thousands)Loans 90 DaysOr More Past Due and StillAccruing:Multi-family $ 201 $ 201 $ 201 $ ? $ ? residentialCommercial ? ? 2,547 ? ? real estateConstruction ? 2,381 ? ? ? Commercialbusiness and ? ? ? ? 150 otherTotal 201 2,582 2,748 ? 150 Non-accrual Loans:Multi-family 4,669 4,338 2,524 2,661 3,688 residentialCommercial 8 8 1,683 2,657 2,671 real estateOne-to-fourfamily - 2,309 2,355 1,366 1,366 2,511 mixed-useproperty ^(1)One-to-fourfamily - 6,940 7,335 5,854 6,454 6,412 residentialSmall Business 976 1,151 1,151 1,151 1,321 AdministrationTaxi medallion ? ? 2,317 2,218 1,757 ^(1)Commercialbusiness and 2,489 3,417 3,430 8,285 1,678 other^(1)Total 17,391 18,604 18,325 24,792 20,038 TotalNon-performing 17,592 21,186 21,073 24,792 20,188 Loans (NPLs) OtherNon-performing Assets:Real estateacquired ? ? ? ? 208 throughforeclosureOther assetacquired ? 35 35 35 35 throughforeclosureTotal ? 35 35 35 243 TotalNon-performing $ 17,592 $ 21,221 $ 21,108 $ 24,827 $ 20,431 Assets Non-performingAssets to 0.22 % 0.26 % 0.26 % 0.35 % 0.29 %Total AssetsAllowance ForLoan Losses to 242.6 % 212.9 % 214.3 % 154.7 % 181.8 %NPLs



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

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIESRECONCILIATION OF GAAP EARNINGS and CORE EARNINGS

Non-cash Fair Value Adjustments to GAAP Earnings

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

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

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

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIESRECONCILIATION OF GAAP EARNINGS and CORE EARNINGS (Unaudited)

Three Months Ended Six Months Ended June30, March 31, December 31, September 30, June30, June30, June30,(Dollars Inthousands, 2021 2021 2020 2020 2020 2021 2020except pershare data) GAAP incomebefore income $ 25,416 $ 26,224 $ 3,878 $ 18,820 $ 24,080 $ 51,640 $ 22,484 taxes Day 1,Provision forCredit Losses- Empire ? ? 1,818 ? ? ? ? transaction(Provisionfor creditlosses)Net (gain)loss fromfair valueadjustments 6,548 (982 ) 4,129 2,225 (10,205 ) 5,566 (4,212 )(Non-interestincome(loss))Net (gain)loss on saleof securities (123 ) ? 610 ? 54 (123 ) 91 (Non-interestincome(loss))Lifeinsuranceproceeds ? ? ? ? (659 ) ? (659 )(Non-interestincome(loss))Net gain ondispositionof assets ? (621 ) ? ? ? (621 ) ? (Non-interestincome(loss))Net (gain)loss fromfair valueadjustmentson qualifying 664 (1,427 ) (1,023 ) (230 ) 365 (763 ) 2,438 hedges(Interest andfees onloans)Prepaymentpenalty onborrowings ? ? 7,834 ? ? ? ? (Non-interestexpense)Netamortizationof purchase (418 ) (789 ) 80 ? ? (1,207 ) ? accountingadjustments(Various)Merger(benefit) (490 ) 973 5,349 422 194 483 1,123 expense(Various) Core income 31,597 23,378 22,675 21,237 13,829 54,975 21,265 before taxes Provision forincome taxes 8,603 6,405 4,891 5,069 3,532 15,008 5,468 for coreincome Core net $ 22,994 $ 16,973 $ 17,784 $ 16,168 $ 10,297 $ 39,967 $ 15,797 income GAAP dilutedearnings per $ 0.61 $ 0.60 $ 0.11 $ 0.50 $ 0.63 $ 1.21 $ 0.58 common shareDay 1,Provision forCredit Losses ? ? 0.05 ? ? ? ? - Empiretransaction,net of taxNet (gain)loss fromfair value 0.15 (0.02 ) 0.11 0.06 (0.27 ) 0.13 (0.11 )adjustments,net of taxNet loss onsale of ? ? 0.02 ? ? ? ? securities,net of taxLifeinsurance ? ? ? ? (0.02 ) ? (0.02 )proceedsNet gain ondisposition ? (0.01 ) ? ? ? (0.01 ) ? of assets,net of taxNet (gain)loss fromfair valueadjustments 0.02 (0.03 ) (0.03 ) (0.01 ) 0.01 (0.02 ) 0.06 on qualifyinghedges, netof taxPrepaymentpenalty on ? ? 0.20 ? ? ? ? borrowings,net of taxNetamortizationof purchase (0.01 ) (0.02 ) ? ? ? (0.03 ) ? accountingadjustments,net of taxMerger(benefit) (0.01 ) 0.02 0.14 0.01 0.01 0.01 0.03 expense, netof taxNYS tax (0.02 ) ? ? ? ? (0.02 ) ? change Core dilutedearnings per $ 0.73 $ 0.54 $ 0.58 $ 0.56 $ 0.36 $ 1.26 $ 0.55 common share^(1) Core netincome, as $ 22,994 $ 16,973 $ 17,784 $ 16,168 $ 10,297 $ 39,967 $ 15,797 calculatedaboveAverage 8,263,553 8,147,714 7,705,407 7,083,028 7,206,059 8,205,954 7,156,529 assetsAverage 644,690 619,647 609,463 576,512 557,414 632,238 567,006 equityCore returnon average 1.11 % 0.83 % 0.92 % 0.91 % 0.57 % 0.97 % 0.44 %assets^(2)Core returnon average 14.27 % 10.96 % 11.67 % 11.22 % 7.39 % 12.64 % 5.57 %equity^(2)



(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 SUBSIDIARIESRECONCILIATION OF GAAP REVENUE and PRE-PROVISION PRE-TAX NET REVENUE (Unaudited)

Three Months Ended Six Months Ended June30, March 31, December 31, September June30, June30, June30, 30,(Dollars In 2021 2021 2020 2020 2020 2021 2020thousands) GAAP Netinterest $ 61,039 $ 60,892 $ 55,732 $ 49,924 $ 48,717 $ 121,931 $ 89,543 incomeNet (gain)loss fromfair value 664 (1,427 ) (1,023 ) (230 ) 365 (763 ) 2,438 adjustmentson qualifyinghedgesNetamortizationof purchase (565 ) (922 ) (11 ) ? ? (1,487 ) ? accountingadjustmentsCore Netinterest $ 61,138 $ 58,543 $ 54,698 $ 49,694 $ 49,082 $ 119,681 $ 91,981 income GAAPNon-interest $ (3,210 ) $ 6,311 $ (1,181 ) $ 1,351 $ 13,737 $ 3,101 $ 10,873 income (loss)Net (gain)loss from 6,548 (982 ) 4,129 2,225 (10,205 ) 5,566 (4,212 )fair valueadjustmentsNet loss onsale of (123 ) ? 610 ? 54 (123 ) 91 securitiesLifeinsurance ? ? ? ? (659 ) ? (659 )proceedsNet gain onsale of ? (621 ) ? ? ? (621 ) ? assetsCoreNon-interest $ 3,215 $ 4,708 $ 3,558 $ 3,576 $ 2,927 $ 7,923 $ 6,093 income GAAPNon-interest $ 34,011 $ 38,159 $ 46,811 $ 29,985 $ 28,755 $ 72,170 $ 61,135 expensePrepaymentpenalty on ? ? (7,834 ) ? ? ? ? borrowingsNetamortizationof purchase (147 ) (133 ) (91 ) ? ? (280 ) ? accountingadjustmentsMerger(benefit) 490 (973 ) (5,349 ) (422 ) (194 ) (483 ) (1,123 )expenseCoreNon-interest $ 34,354 $ 37,053 $ 33,537 $ 29,563 $ 28,561 $ 71,407 $ 60,012 expense Net interest $ 61,039 $ 60,892 $ 55,732 $ 49,924 $ 48,717 $ 121,931 $ 89,543 incomeNon-interest (3,210 ) 6,311 (1,181 ) 1,351 13,737 3,101 10,873 income (loss)Non-interest (34,011 ) (38,159 ) (46,811 ) (29,985 ) (28,755 ) (72,170 ) (61,135 )expensePre-provisionpre-tax net $ 23,818 $ 29,044 $ 7,740 $ 21,290 $ 33,699 $ 52,862 $ 39,281 revenue Core: Net interest $ 61,138 $ 58,543 $ 54,698 $ 49,694 $ 49,082 $ 119,681 $ 91,981 incomeNon-interest 3,215 4,708 3,558 3,576 2,927 7,923 6,093 incomeNon-interest (34,354 ) (37,053 ) (33,537 ) (29,563 ) (28,561 ) (71,407 ) (60,012 )expensePre-provisionpre-tax net $ 29,999 $ 26,198 $ 24,719 $ 23,707 $ 23,448 $ 56,197 $ 38,062 revenueEfficiency 53.4 % 58.6 % 57.6 % 55.4 % 54.9 % 56.0 % 61.2 %Ratio

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIESRECONCILIATION OF GAAP NET INTEREST INCOME and NET INTEREST MARGINto CORE and BASE NET INTEREST INCOME (Unaudited)

Three Months Ended Six Months Ended June30, March 31, December 31, September 30, June30, June30, June30,(Dollars In 2021 2021 2020 2020 2020 2021 2020thousands)GAAP net $ 61,039 $ 60,892 $ 55,732 $ 49,924 $ 48,717 $ 121,931 $ 89,543 interest incomeNet (gain) lossfrom fair valueadjustments on 664 (1,427 ) (1,023 ) (230 ) 365 (763 ) 2,438 qualifyinghedgesNet amortizationof purchase (565 ) (922 ) (11 ) ? ? (1,487 ) ? accountingadjustmentsTax equivalent 113 111 114 117 135 224 277 adjustmentCore netinterest income $ 61,251 $ 58,654 $ 54,812 $ 49,811 $ 49,217 $ 119,905 $ 92,258 FTEPrepaymentpenaltiesreceived onloans, net ofreversals and (2,046 ) (947 ) (1,093 ) (1,518 ) (776 ) (2,993 ) (1,965 )recoveries ofinterest fromnon-accrualloansBase netinterest income $ 59,205 $ 57,707 $ 53,719 $ 48,293 $ 48,441 $ 116,912 $ 90,293 FTE Total averageinterest-earning $ 7,799,176 $ 7,676,833 $ 7,245,147 $ 6,675,896 $ 6,809,835 $ 7,738,344 $ 6,764,846 assets ^(1)Core netinterest margin 3.14 % 3.06 % 3.03 % 2.98 % 2.89 % 3.10 % 2.73 %FTEBase netinterest margin 3.04 % 3.01 % 2.97 % 2.89 % 2.85 % 3.02 % 2.67 %FTE GAAP interestincome on total $ 67,999 $ 69,021 $ 66,120 $ 60,367 $ 60,557 $ 137,020 $ 121,666 loans, netNet (gain) lossfrom fair valueadjustments on 664 (1,427 ) (1,023 ) (230 ) 365 (763 ) 2,438 qualifyinghedgesNet amortizationof purchase (624 ) (728 ) (356 ) ? ? (1,352 ) ? accountingadjustmentsCore interestincome on total $ 68,039 $ 66,866 $ 64,741 $ 60,137 $ 60,922 $ 134,905 $ 124,104 loans, netPrepaymentpenaltiesreceived onloans, net ofreversals and (2,046 ) (947 ) (1,093 ) (1,443 ) (776 ) (2,993 ) (1,965 )recoveries ofinterest fromnon-accrualloansBase interestincome on total $ 65,993 $ 65,919 $ 63,648 $ 58,694 $ 60,146 $ 131,912 $ 122,139 loans, net Average total $ 6,697,103 $ 6,711,446 $ 6,379,429 $ 5,904,051 $ 5,946,412 $ 6,704,237 $ 5,870,640 loans, net ^(1)Core yield on 4.06 % 3.99 % 4.06 % 4.07 % 4.10 % 4.02 % 4.23 %total loansBase yield on 3.94 % 3.93 % 3.99 % 3.98 % 4.05 % 3.94 % 4.16 %total loans



(1) Excludes purchase accounting average balances for three months ended June 30, 2021, March 31, 2021, and December 31, 2020.

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIESCALCULATION OF TANGIBLE STOCKHOLDERSCOMMON EQUITY to TANGIBLE ASSETS(Unaudited)

June30, March 31, December 31, September 30, June30,(Dollars in 2021 2021 2020 2020 2020thousands)Total Equity $ 655,167 $ 639,201 $ 618,997 $ 586,406 $ 571,921 Less: Goodwill (17,636 ) (17,636 ) (17,636 ) (16,127 ) (16,127 )Core deposit (2,859 ) (3,013 ) (3,172 ) ? ? IntangiblesIntangibledeferred tax 287 287 287 292 292 liabilitiesTangibleStockholders' $ 634,959 $ 618,839 $ 598,476 $ 570,571 $ 556,086 Common Equity Total Assets $ 8,159,345 $ 8,159,184 $ 7,976,394 $ 7,063,056 $ 7,162,659 Less: Goodwill (17,636 ) (17,636 ) (17,636 ) (16,127 ) (16,127 )Core deposit (2,859 ) (3,013 ) (3,172 ) ? ? IntangiblesIntangibledeferred tax 287 287 287 292 292 liabilitiesTangible $ 8,139,137 $ 8,138,822 $ 7,955,873 $ 7,047,221 $ 7,146,824 Assets TangibleStockholders'Common Equity 7.80 % 7.60 % 7.52 % 8.10 % 7.78 %to TangibleAssets