GlobeNewswire Inc | Jul 29, 2021 06:25AM EDT

July 29, 2021

NEW YORK, July 29, 2021 (GLOBE NEWSWIRE) -- Amalgamated Financial Corp. (the Company or Amalgamated) (Nasdaq: AMAL), the holding company for Amalgamated Bank (the Bank), today announced financial results for the second quarter ended June30, 20211.

Second Quarter 2021 Highlights

-- Net income of $10.4 million, or $0.33 per diluted share, compared to $12.2 million, or $0.39 per diluted share, for the first quarter of 2021 and $10.4 million, or $0.33 per diluted share for the second quarter of 2020. -- Deposits increased $189.9 million to $5.9 billion on a linked quarter basis. -- Political deposits remained strong and stable at $791.3 million as of June30, 2021, with $99.3 million growth on a linked quarter basis. -- Cost of deposits was 0.10%, down 10 bps from the second quarter of 2020. -- PACE assessments grew $94.2 million to $545.8 million on a linked quarter basis, and grew $222.4 million on a year over year basis. Current quarter growth included $82.8 million of Commercial PACE assessments. -- Loans decreased $85.4 million to $3.1 billion, on a linked quarter basis, due to continued prepayment activity and paydowns on commercial revolvers. -- Net interest margin was 2.75%, compared to 2.85% for the first quarter of 2021 and 3.10% for the second quarter of 2020. -- Repurchased approximately 154,000 shares, or $2.5 million of common stock. -- Regulatory capital remains above bank well capitalized standards. -- Nonperforming assets improved to $71.0 million or 1.08% of total assets as of June30, 2021, compared to $81.0 million or 1.27% of total assets on a linked quarter basis.

Priscilla Sims Brown, President and Chief Executive Officer, commented, I am encouraged to report that our second quarter results provide confirmation of the continuing soundness of Amalgamateds financial foundation, which underpins our ability to grow and accelerate profitability. Our deposit franchise remains a source of strength with one of the lowest cost of deposits in the industry at 10 basis points and powered by political deposits which have steadily grown following the recent election cycle. Our underwriting and credit management has positioned the Bank to explore a range of mission-aligned options as we focus on organic loan growth. While the current backdrop remains challenging as loan demand is tepid and prepayments remained elevated, our PACE assessments pipeline in both residential and commercial is encouraging and we are optimistic for loan demand to rebound as we look to the second half of the year.

Brown added, I am delighted that the Board asked me to lead Amalgamated into the future. After spending more than 30 years in the banking and financial services sectors, what attracted me to Amalgamated was their ability to redefine the concept of banking, never wavering from their century-long mission of empowering organizations and individuals to advance positive social change. I have spent a good portion of my career building brands both nationally and internationally in banking and financial services firms in the public and private sectors. Amalgamateds mission is one that needs to be told to a world that is increasingly receptive to hearing it. We see significant opportunities in the markets in which Amalgamated participates and we are strategically evaluating how to maximize our brand and the ways we do business, including deepening our high-value client relationships, expanding our customer base, accelerating organic loan growth, and exploring M&A opportunities. I look forward to providing a more detailed plan on our third quarter call.

____________________________[1] Effective March 1, 2021, the Company acquired all of the outstanding stock of the Bank in a reorganization effected under New York law and in accordance with the terms of a Plan of Acquisition dated September 4, 2020. In this release, unless the context indicates otherwise, references to we, us, and our refer to the Company and the Bank. However, if the discussion relates to a period before the effective date, the terms refer only to the Bank.

Results of Operations, Quarter Ended June30, 2021

Net income for the second quarter of 2021 was $10.4 million, or $0.33 per diluted share, compared to $12.2 million, or $0.39 per diluted share, for the first quarter of 2021 and $10.4 million, or $0.33 per diluted share, for the second quarter of 2020. The $1.8 million decrease for the second quarter of 2021 was primarily due to a $1.7 million provision expense for loan losses compared to a $3.3 million release of provision for loan losses in the preceding quarter. The provision expense increase was partially offset by a $1.4 million decrease in non-interest expense, and a $1.3 million increase in non-interest income.

Core net income (non-GAAP)2 for the second quarter of 2021 was $10.2 million, or $0.32 per diluted share, compared to $13.0 million, or $0.41 per diluted share, for the first quarter of 2021 and $10.6 million, or $0.34 per diluted share, for the second quarter of 2020. Excluded from core net income for the second quarter of 2021 was $0.3 million of non-interest income gains on the sale of securities, and for the first quarter of 2021 was $1.1 million of severance expense related to the modernization of our Trust Department and its related tax impact. Excluded from core net income for the second quarter of 2020 was $0.5 million of non-interest income gains on the sale of securities, $0.7 million in expense related to the closure of six branches, and other adjustments, including the tax effect of such adjustments.

Net interest income was $42.0 million for the second quarter of 2021, compared to $41.8 million for the first quarter of 2021 and $44.4 million for the second quarter of 2020. The $0.2 million increase from the preceding quarter reflected higher income on securities and lower interest expense on deposits, almost wholly offset by a decrease in interest income as average loans decreased $130.9 million from the prepayment and paydowns of residential and commercial loans. The $2.4 million decrease from the second quarter of 2020 was primarily attributable to a decrease in average loans of $408.3 million from the prepayment of residential and commercial loans and a 15 basis point decrease in yield due to lower yields on originations, partially offset by higher income on securities and lower interest expense on deposits.

Net interest margin was 2.75% for the second quarter of 2021, a decrease of 10 basis points from 2.85% in the first quarter of 2021, and a decrease of 35 basis points from 3.10% in the second quarter of 2020. The accretion of the loan mark from the loans acquired in the New Resource Bank acquisition contributed two basis points to our net interest margin in the second quarter of 2021, compared to two and three basis points in the first quarter of 2021 and second quarter of 2020, respectively. Prepayment penalties earned in loan income contributed three basis points to our net interest margin in the second quarter of 2021, compared to four basis points in the first quarter of 2021 and two basis points in the second quarter of 2020.

Provision for loan losses totaled an expense of $1.7 million for the second quarter of 2021 compared to a recovery of $3.3 million in the first quarter of 2021 and an expense of $8.2 million for the second quarter of 2020, respectively. The expense in the second quarter of 2021 was primarily driven by an increase in allowance due to an increase of specific reserves for C&I loans, countered by net balance reductions.

Non-interest income was $5.3 million for the second quarter of 2021, compared to $4.0 million in the first quarter of 2021 and $8.7 million for the second quarter in 2020. This increase of $1.3 million in the second quarter of 2021, compared to the preceding quarter, was primarily due to the expected decrease in equity method investment losses related to investments in solar initiatives partially offset by a decrease of $0.5 million in Trust Department fees primarily attributed to the low interest rate environment and pressure on fixed income bonds. The decrease of $3.4 million in the second quarter of 2021 compared to the corresponding quarter in 2020 was primarily due to a loss of $1.6 million related to equity investments in solar initiatives in the second quarter of 2021 compared to a $1.3 million gain in the second quarter of 2020. The Company primarily recognized the benefit of the tax credits in 2020, the initial year of the equity investment. We expect minimal losses in equity method investments during the remainder of 2021. These impacts do not include any benefits of new solar equity investments that we may make in the future.

Non-interest expense for the second quarter of 2021 was $31.4 million, a decrease of $1.4 million from the first quarter of 2021 and an increase of $0.3 million from the second quarter of 2020. The decrease of $1.4 million from the preceding quarter was primarily due to a $1.1 million charge for severance related to the modernization of our Trust Department in the first quarter of 2021 and a decrease in professional service expense.

Our provision for income tax expense was $3.8 million for the second quarter of 2021, compared to $4.1 million for the first quarter of 2021 and $3.4 million for the second quarter of 2020. Our effective tax rate for the second quarter of 2021 was 26.9%, compared to 25.4% for the first quarter of 2021 and 24.9% for the second quarter of 2020.

___________________________[2] Reconciliations of non-GAAP financial measures to the most comparable GAAP measure are set forth on the last page of the financial information accompanying this press release and may also be found on our website, www.amalgamatedbank.com.

Results of Operations, Six Months Ended June30, 2021

Net income for the six months ended June30, 2021 was $22.6 million, or $0.72 per average diluted share, compared to $19.9 million, or $0.64 per average diluted share, for same period in 2020. The $2.7 million increase was primarily due to a $1.6 million recovery of provision for loan loss compared to a $16.8 million increase to provision for loan loss for the same period in 2020. This recovery of provision was partially offset by a $8.5 million decrease in non-interest income, a $5.3 million decrease in net interest income and a $0.9 million increase in non-interest expense.

Core net income (non-GAAP) for the six months ended June30, 2021 of $23.2 million, or $0.73 per diluted share, compared to $19.7 million or $0.63 per diluted share, for the same period last year. Core net income for the first six months of 2021 excludes severance costs, non-interest income gains on the sale of securities, and the tax effect of such adjustments.

Net interest income was $83.8 million for the six months ended June30, 2021, compared to $89.1 million for the same period in 2020. This decrease of $5.3 million was primarily attributable to a decrease in average loans of $289.6 million and lower yields earned on interest bearing assets. These impacts are partially offset by an increase in average securities of $670.0 million, and a decrease in average rates paid on deposits.

Provision for loan losses totaled a recovery of $1.6 million for the six months ended June30, 2021, compared to an expense of $16.8 million for the same period in 2020. The recovery for the six months ended June30, 2021 was primarily driven by a release of allowance for loan loss due to lower loan balances, and the upgrade of one construction loan to a pass rating, countered by an increase in allowance due to an increase of specific reserves for C&I loans.

Non-interest income was $9.3 million for the six months ended June30, 2021, compared to $17.8 million for the same period in 2020, a decrease of $8.5 million. This decrease is primarily due to a decrease of $6.8 million in a tax credits on equity investment projects, a $1.4 million gain on the sale of a branch reported in other non-interest income in the prior year, a $0.9 million decrease in Trust Department fees primarily attributed to the low interest rate environment and pressure on fixed income bonds, as mentioned above, the expected wind-down of the real estate fund, and a decrease in gain on the sale of securities. These decreases were partially offset by an increase of $1.1 million in gains on the sale of residential loans.

Non-interest expense for the six months ended June30, 2021 was $64.2 million, an increase of $0.9 million from $63.3 million for the six months ended June30, 2020. The increase was primarily due to a $1.9 million increase in professional fees mainly related to our holding company formation and chief executive officer search, a $1.1 million increase in data processing mainly related to the modernization of our Trust Department and increased transaction processing post COVID-19, and a $0.9 million increase in other expenses, offset by a $2.9 million decrease in branch occupancy expense attributed to branch closure expenses in the prior year and lower rent expense in the current year.

We had income tax expense of $8.0 million for the six months ended June30, 2021, compared to $6.9 million for the same period in 2020. Our effective tax rate was 26.0% for the six months ended June30, 2021, compared to 25.6% for the same period in 2020.

Financial Condition

Total assets were $6.6 billion at June30, 2021, compared to $6.0 billion at December31, 2020. The increase of $0.6 billion was driven primarily by a $508.7 million increase in cash and cash equivalents and a $415.2 million increase in investment securities, of which $94.2 million was from PACE assessments, which was partially offset by a $309.9 million decrease in loans receivable, net.

Total loans, net at June30, 2021 were $3.1 billion, a decrease of $309.9 million, or 18.1% annualized, compared to December31, 2020. The decline in loans was primarily driven by a $152.9 million decrease in residential loans due to increased refinancing activity by existing customers, a $119.6 million decrease in commercial real estate and multifamily loans due to refinancing activity by existing customers, and a $58.2 million decrease in C&I loans due to the payoff of one large loan. As of June30, 2021, the Company had $4.0 million in loans remaining on a payment deferral program and still accruing interest, the majority of which were residential 1-4 family loans, and none were commercial loans.

Deposits at June30, 2021 were $5.9 billion, an increase of $571.3 million, or 21.6% annualized, as compared to $5.3 billion as of December31, 2020. Deposits held by politically active customers, such as campaigns, PACs, advocacy-based organizations, and state and national party committees were $791.3 million as of June30, 2021, an increase of $188.5 million compared to $602.8 million as of December31, 2020. Noninterest-bearing deposits represent 51% of average deposits and 50% of ending deposits for the quarter ended June30, 2021, contributing to an average cost of deposits of 0.10% in the second quarter of 2021, a one basis point decrease from the preceding quarter.

Nonperforming assets totaled $71.0 million, or 1.08% of period-end total assets at June30, 2021, a decrease of $11.2 million, compared with $82.2 million, or 1.38% of period-end total assets at December31, 2020. The decrease in non-performing assets at June30, 2021 compared to December31, 2020 was primarily driven by the payoff of $11.2 million of non-accruing construction loans, and the decrease of $1.4 million of loans ninety days past due and accruing, partially offset by an increase of $2.1 million of C&I loans.

The allowance for loan losses decreased $3.6 million to $38.0 million at June30, 2021 from $41.6 million at December31, 2020, primarily due to decreases in loan balances. At June30, 2021, we had $70.6 million of impaired loans for which a specific allowance of $6.3 million was made, compared to $80.5 million of impaired loans at December31, 2020 for which a specific allowance of $6.2 million was made. The ratio of allowance to total loans was 1.20% at June30, 2021 and 1.19% at December31, 2020.

Capital

As of June30, 2021, our Common Equity Tier 1 Capital Ratio was 13.63%, Total Risk-Based Capital Ratio was 14.68%, and Tier-1 Leverage Capital Ratio was 7.93%, compared to 13.11%, 14.25% and 7.97%, respectively, as of December31, 2020. Stockholders equity at June30, 2021 was $548.2 million, compared to $535.8 million at December31, 2020. The increase in stockholders equity was driven by $22.6 million of net income, partially offset by a $1.5 million decrease in accumulated other comprehensive income due to the mark to market on our securities portfolio and $3.7 million decrease in additional paid-in capital.

Our tangible book value per share was $17.07 as of June30, 2021 compared to $16.66 as of December31, 2020.

Conference Call

As previously announced, Amalgamated Financial Corp. will host a conference call to discuss its second quarter 2021 results today, July 29th, 2021 at 11:00am (Eastern Time). The conference call can be accessed by dialing 1-877-407-9716 (domestic) or 1-201-493-6779 (international) and asking for the Amalgamated Financial Corp. Second Quarter 2021 Earnings Call. A telephonic replay will be available approximately two hours after the call and can be accessed by dialing 1-844-512-2921, or for international callers 1-412-317-6671 and providing the access code 13720783. The telephonic replay will be available until August 5, 2021.

Interested investors and other parties may also listen to a simultaneous webcast of the conference call by logging onto the investor relations section of our website at http://ir.amalgamatedbank.com/. The online replay will remain available for a limited time beginning immediately following the call.

The presentation materials for the call can be accessed on the investor relations section of our website at http://ir.amalgamatedbank.com/.

About Amalgamated Financial Corp.

Amalgamated Financial Corp. is a Delaware public benefit corporation and a bank holding company engaged in commercial banking and financial services through its wholly-owned subsidiary, Amalgamated Bank. Amalgamated Bank is a New York-based full-service commercial bank and a chartered trust company with a combined network of six branches in New York City, Washington D.C., San Francisco, and Boston. Amalgamated Bank was formed in 1923 as Amalgamated Bank of New York by the Amalgamated Clothing Workers of America, one of the country's oldest labor unions. Amalgamated Bank provides commercial banking and trust services nationally and offers a full range of products and services to both commercial and retail customers. Amalgamated Bank is a proud member of the Global Alliance for Banking on Values and is a certified B Corporation. As of June30, 2021, our total assets were $6.6 billion, total net loans were $3.1 billion, and total deposits were $5.9 billion. Additionally, as of June30, 2021, our trust business held $39.2 billion in assets under custody and $16.6 billion in assets under management.

Non-GAAP Financial Measures

This release (and the accompanying financial information and tables) refers to certain non-GAAP financial measures including, without limitation, Core operating revenue, Core non-interest expense, Core net income, Tangible common equity, Average tangible common equity, Core return on average assets, Core return on average tangible common equity, and Core efficiency ratio.

Our management utilizes this information to compare our operating performance for June30, 2021 versus certain periods in 2020 and to prepare internal projections. We believe these non-GAAP financial measures facilitate making period-to-period comparisons and are meaningful indications of our operating performance. In addition, because intangible assets such as goodwill and other discrete items unrelated to our core business, which are excluded, vary extensively from company to company, we believe that the presentation of this information allows investors to more easily compare our results to those of other companies.

The presentation of non-GAAP financial information, however, is not intended to be considered in isolation or as a substitute for GAAP financial measures. We strongly encourage readers to review the GAAP financial measures included in this release and not to place undue reliance upon any single financial measure. In addition, because non-GAAP financial measures are not standardized, it may not be possible to compare the non-GAAP financial measures presented in this release with other companies non-GAAP financial measures having the same or similar names. Reconciliations of non-GAAP financial disclosures to comparable GAAP measures found in this release are set forth in the final pages of this release and also may be viewed on our website, amalgamatedbank.com.

Terminology

Certain terms used in this release are defined as follows:

Core operating revenue is defined as total net interest income plus non-interest income excluding gains and losses on sales of securities and gains on the sale of owned property. We believe the most directly comparable GAAP financial measure is the total of net interest income and non-interest income.

Core non-interest expense is defined as total non-interest expense excluding costs related to branch closures and restructuring/severance costs. We believe the most directly comparable GAAP financial measure is total non-interest expense.

Core net income is defined as net income after tax excluding gains and losses on sales of securities, gains on the sale of owned property, costs related to branch closures, restructuring/severance costs, and taxes on notable pre-tax items. We believe the most directly comparable GAAP financial measure is net income.

Tangible common equity and Tangible book value and are defined as stockholders equity excluding, as applicable, minority interests, preferred stock, goodwill and core deposit intangibles. We believe that the most directly comparable GAAP financial measure is total stockholders equity.

Core return on average assets is defined as Core net income divided by average total assets. We believe the most directly comparable performance ratio derived from GAAP financial measures is return on average assets calculated by dividing net income by average total assets.

Core return on average tangible common equity is defined as Core net income divided by Average tangible common equity. We believe the most directly comparable performance ratio derived from GAAP financial measures is return on average equity calculated by dividing net income by average total stockholders equity.

Core efficiency ratio is defined as Core non-interest expense divided by Core operating revenue. We believe the most directly comparable performance ratio derived from GAAP financial measures is an efficiency ratio calculated by dividing total non-interest expense by the sum of net interest income and total non-interest income.

Forward-Looking Statements

Statements included in this release that are not historical in nature are intended to be, and are hereby identified as, forward-looking statements within the meaning of the Private Securities Litigation Reform Act, Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements generally can be identified through the use of forward-looking terminology such as may, will, anticipate, should, would, believe, contemplate, expect, estimate, continue, in the future, may and intend, as well as other similar words and expressions of the future, and in this press release include statements about expected rebound in loan demand, the wind-down in our real estate fund and the losses in our equity method investments. Forward-looking statements are subject to known and unknown risks, uncertainties and other factors, any or all of which could cause actual results to differ materially from the results expressed or implied by such forward-looking statements. These risks and uncertainties include, but are not limited to: (i) deterioration in the financial condition of borrowers resulting in significant increases in loan losses and provisions for those losses; (ii) continuation of the historically low short-term interest rate environment; (iii) our inability to maintain the historical growth rate of the loan portfolio; (iv) changes in loan underwriting, credit review or loss reserve policies associated with economic conditions, examination conclusions, or regulatory developments; (v) the impact of competition with other financial institutions, including pricing pressures and the resulting impact on our results, including as a result of compression to net interest margin; (vi) greater than anticipated adverse conditions in the national or local economies including in our core markets, including, but not limited to, the negative impacts and disruptions resulting from the outbreak of the novel coronavirus, or COVID-19, which may continue to have an adverse impact on our business, operations and performance, and could continue to have a negative impact on our credit portfolio, share price, borrowers, and on the economy as a whole, both domestically and globally; (vii) fluctuations or unanticipated changes in interest rates on loans or deposits or that affect the yield curve; (viii) the results of regulatory examinations; (ix) potential deterioration in real estate values; (x) changes in legislation, regulation, policies, or administrative practices, whether by judicial, governmental, or legislative action; (xi) the risk that the preliminary financial information reported herein and our current preliminary analysis will be different when our review is finalized; (xii) increased competition for experienced executives in the banking industry; and (xiii) unexpected challenges and potential operational disruptions related to our executive officer transitions. Additional factors which could affect the forward-looking statements can be found in our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K filed with the SEC and available on the SEC's website at https://www.sec.gov/. We disclaim any obligation to update or revise any forward-looking statements contained in this release, which speak only as of the date hereof, whether as a result of new information, future events or otherwise, except as required by law.

Investor ContactJamie LillisSolebury Troutshareholderrelations@amalgamatedbank.com800-895-4172

Consolidated Statements of Income (unaudited) Three Months Ended Six Months Ended June 30, March 31, June 30, June 30,($ in thousands) 2021 2021 2020 2021 2020INTEREST AND DIVIDEND INCOMELoans $ 30,156 $ 31,109 $ 35,225 $ 61,265 $ 70,837 Securities 13,094 12,170 11,746 25,264 24,299 Federal HomeLoan Bank of New 41 48 66 89 135 York stockInterest-bearingdeposits in 131 90 83 221 479 banksTotal interestand dividend 43,422 43,417 47,120 86,839 95,750 incomeINTEREST EXPENSE Deposits 1,431 1,573 2,681 3,003 6,596 Borrowed funds ? ? ? ? 27 Total interest 1,431 1,573 2,681 3,003 6,623 expenseNET INTEREST 41,991 41,844 44,439 83,836 89,127 INCOMEProvision for(recovery of) 1,682 (3,261 ) 8,221 (1,579 ) 16,808 loan lossesNet interestincome after 40,309 45,105 36,218 85,415 72,319 provision forloan lossesNON-INTEREST INCOMETrust Department 3,292 3,827 3,980 7,118 8,066 feesService chargeson deposit 2,296 2,178 1,850 4,475 4,261 accountsBank-owned life 531 788 1,111 1,319 1,495 insuranceGain (loss) onsale ofinvestment 321 21 486 342 985 securitiesavailable forsale, netGain (loss) onsale of loans, 720 707 162 1,426 297 netGain (loss) onother real (407 ) ? (283 ) (407 ) (306 )estate owned,netEquity method (1,555 ) (3,682 ) 1,289 (5,237 ) 1,289 investmentsOther 129 161 76 290 1,702 Totalnon-interest 5,327 4,000 8,671 9,326 17,789 incomeNON-INTEREST EXPENSECompensation andemployee 16,964 18,039 17,334 35,003 34,792 benefitsOccupancy and 3,352 3,501 4,241 6,853 9,747 depreciationProfessional 3,211 3,661 1,988 6,871 4,971 feesData processing 3,322 3,005 2,977 6,327 5,241 Officemaintenance and 820 655 818 1,475 1,675 depreciationAmortization ofintangible 302 302 342 604 685 assetsAdvertising and 628 597 672 1,225 1,339 promotionOther 2,796 3,033 2,696 5,831 4,889 Totalnon-interest 31,395 32,793 31,068 64,189 63,339 expenseIncome before 14,241 16,312 13,821 30,552 26,769 income taxesIncome taxexpense 3,833 4,123 3,447 7,955 6,850 (benefit)Net income 10,408 12,189 10,374 22,597 19,919 Net incomeattributable to $ 10,408 $ 12,189 $ 10,374 $ 22,597 $ 19,919 AmalgamatedFinancial Corp.Earnings percommon share - 0.33 0.39 0.33 0.73 0.64 basicEarnings percommon share - 0.33 0.39 0.33 0.72 0.64 diluted

Consolidated Statements of Financial Condition ($ in thousands) June 30, December 31, 2021 2020Assets (unaudited) Cash and due from banks $ 7,960 $ 7,736 Interest-bearing deposits in banks 539,485 31,033 Total cash and cash equivalents 547,445 38,769 Securities: Available for sale, at fair value (amortized cost 1,824,726 1,539,862 of $1,799,993 and $1,513,409, respectively)Held-to-maturity (fair value of $621,954 and 624,826 494,449 $502,425, respectively)Loans held for sale 8,230 11,178 Loans receivable, net of deferred loan 3,175,461 3,488,895 origination costs (fees)Allowance for loan losses (38,012 ) (41,589 )Loans receivable, net 3,137,449 3,447,306 Resell agreements 141,651 154,779 Accrued interest and dividends receivable 22,648 23,970 Premises and equipment, net 12,876 12,977 Bank-owned life insurance 106,197 105,888 Right-of-use lease asset 35,072 36,104 Deferred tax asset, net 24,328 36,079 Goodwill 12,936 12,936 Other intangible assets 4,755 5,359 Equity investments 6,296 11,735 Other assets 46,837 47,240 Total assets $ 6,556,272 $ 5,978,631 Liabilities Deposits $ 5,909,992 $ 5,338,711 Operating leases 51,165 53,173 Other liabilities 46,904 50,926 Total liabilities 6,008,061 5,442,810 Commitments and contingencies ? ? Stockholders? equity Common stock, par value $.01 per share(70,000,000 shares authorized; 31,073,669 and 311 310 31,049,525 shares issued and outstanding,respectively)Additional paid-in capital 297,283 300,989 Retained earnings 234,769 217,213 Accumulated other comprehensive income (loss), 15,715 17,176 net of income taxesTotal Amalgamated Financial Corp. stockholders' 548,078 535,688 equityNoncontrolling interests 133 133 Total stockholders' equity 548,211 535,821 Total liabilities and stockholders? equity $ 6,556,272 $ 5,978,631

Select Financial Data As of and for the As of and for the Three Months Ended Six Months Ended June 30, March 31, June 30, June 30,(Shares in 2021 2021 2020 2021 2020thousands)SelectedFinancial Ratios and Other Data:Earnings Basic $ 0.33 $ 0.39 $ 0.33 0.73 0.64 Diluted 0.33 0.39 0.33 0.72 0.64 Core net income (non-GAAP)Basic $ 0.33 $ 0.42 $ 0.34 0.74 0.63 Diluted 0.32 0.41 0.34 0.73 0.63 Book value percommon share(excluding 17.64 17.33 16.22 17.64 16.22 minorityinterest)Tangible bookvalue per share 17.07 16.75 15.61 17.07 15.61 (non-GAAP)Common shares 31,074 31,169 31,050 31,074 31,050 outstandingWeighted averagecommon shares 31,136 31,082 31,023 31,109 31,217 outstanding,basicWeighted averagecommon shares 31,572 31,524 31,035 31,545 31,345 outstanding,diluted

Select Financial Data As of and for the As of and for the Three Months Ended Six Months Ended June March June 30, June 30, 30, 31, 2021 2021 2020 2021 2020Selected Performance Metrics:Return on average assets 0.65 % 0.79 % 0.69 % 0.72 % 0.70 %Core return on average 0.64 % 0.85 % 0.70 % 0.74 % 0.69 %assets (non-GAAP)Return on average equity 7.62 % 9.11 % 8.56 % 8.36 % 8.10 %Core return on averagetangible common equity 7.70 % 10.05 % 9.07 % 8.86 % 8.35 %(non-GAAP)Average equity to average 8.57 % 8.71 % 8.03 % 8.63 % 8.61 %assetsTangible common equity to 8.09 % 8.18 % 7.49 % 8.09 % 7.49 %assetsLoan yield 3.82 % 3.83 % 3.97 % 3.83 % 4.05 %Securities yield 2.15 % 2.18 % 2.59 % 2.17 % 2.91 %Deposit cost 0.10 % 0.11 % 0.20 % 0.11 % 0.26 %Net interest margin 2.75 % 2.85 % 3.10 % 2.80 % 3.27 %Efficiency ratio^ (1) 66.35 % 71.53 % 58.50 % 68.90 % 59.24 %Core efficiency ratio 66.80 % 69.18 % 57.68 % 67.98 % 58.56 %(non-GAAP)^ (1) Asset Quality Ratios: Nonaccrual loans to total 1.64 % 1.78 % 1.24 % 1.64 % 1.24 %loansNonperforming assets to 1.08 % 1.27 % 1.15 % 1.08 % 1.15 %total assetsAllowance for loan losses 73.20 % 63.32 % 109.49 % 73.20 % 109.49 %to nonaccrual loansAllowance for loan losses 1.20 % 1.13 % 1.36 % 1.20 % 1.36 %to total loansAnnualized netcharge-offs (recoveries) 0.04 % 0.20 % 0.06 % 0.12 % 0.04 %to average loans Capital Ratios: Tier 1 leverage capital 7.93 % 8.06 % 7.69 % 7.93 % 7.69 %ratioTier 1 risk-based capital 13.63 % 13.70 % 12.32 % 13.63 % 12.32 %ratioTotal risk-based capital 14.68 % 14.74 % 13.57 % 14.68 % 13.57 %ratioCommon equity tier 1 13.63 % 13.70 % 12.32 % 13.63 % 12.32 %capital ratio (1) Efficiency ratio is calculated by dividing total non-interest expense bythe sum of net interest income and total non-interest income

Loan and Held-to-Maturity Securities Portfolio Composition (In thousands) At June 30, 2021 At March 31, 2021 At June 30, 2020 % of % of % of Amount total Amount total Amount total loans loans loansCommercial portfolio:Commercial and $ 619,037 19.5 % $ 612,581 18.8 % $ 617,579 16.8 %industrialMultifamily 848,651 26.8 % 882,231 27.2 % 972,129 26.4 %Commercial real 351,707 11.1 % 364,308 11.2 % 404,064 11.0 %estateConstruction and 42,303 1.3 % 50,267 1.5 % 65,259 1.8 %land developmentTotal commercial 1,861,698 58.7 % 1,909,387 58.7 % 2,059,031 56.0 %portfolio Retail portfolio:Residential real 1,085,791 34.3 % 1,137,851 35.0 % 1,432,645 38.9 %estate lendingConsumer and 222,265 7.0 % 206,451 6.3 % 187,980 5.1 %otherTotal retail 1,308,056 41.3 % 1,344,302 41.3 % 1,620,625 44.0 %Total loans 3,169,754 100.0 % 3,253,689 100.0 % 3,679,656 100.0 % Net deferredloan origination 5,707 5,815 8,336 costs (fees)Allowance for (38,012 ) (36,662 ) (50,010 ) loan lossesTotal loans, net $ 3,137,449 $ 3,222,842 $ 3,637,982 Held-to-maturitysecurities portfolio:PACE assessments 545,795 87.4 % 451,643 85.0 % 323,392 87.3 %Other securities 79,031 12.6 % 79,631 15.0 % 47,106 12.7 %Totalheld-to-maturity $ 624,826 100.0 % $ 531,274 100.0 % $ 370,498 100.0 %securities

Net Interest Income Analysis Three Months Ended June 30, 2021 March 31, 2021 June 30, 2020 Average Income / Yield Average Income / Yield Average Income / Yield(In thousands) Balance Expense / Balance Expense / Balance Expense / Rate Rate Rate Interest earning assets:Interest-bearing $ 510,473 $ 131 0.10 % $ 380,390 $ 90 0.10 % $ 364,932 $ 83 0.09 %deposits in banksSecurities and FHLB 2,447,241 13,135 2.15 % 2,271,218 12,218 2.18 % 1,834,892 11,812 2.59 %stockTotal loans, net^ 3,162,896 30,156 3.82 % 3,293,775 31,109 3.83 % 3,571,160 35,225 3.97 %(1)(2)Total interest 6,120,610 43,422 2.85 % 5,945,383 43,417 2.96 % 5,770,984 47,120 3.28 %earning assetsNon-interest earning assets:Cash and due from 7,545 7,307 74,877 banksOther assets 266,613 279,308 224,531 Total assets $ 6,394,768 $ 6,231,998 $ 6,070,392 Interest bearing liabilities:Savings, NOW andmoney market $ 2,567,396 $ 1,174 0.18 % $ 2,512,892 $ 1,222 0.20 % $ 2,313,772 $ 1,755 0.31 %depositsTime deposits 258,257 257 0.40 % 280,057 351 0.51 % 370,969 926 1.00 %Total deposits 2,825,653 1,431 0.20 % 2,792,949 1,573 0.23 % 2,684,741 2,681 0.40 %Federal Home Loan ? ? 0.00 % 495 ? 0.00 % ? ? 0.00 %Bank advancesTotal interest 2,825,653 1,431 0.20 % 2,793,444 1,573 0.23 % 2,684,741 2,681 0.40 %bearing liabilitiesNon-interest bearing liabilities:Demand and 2,909,554 2,786,581 2,746,529 transaction depositsOther liabilities 111,795 109,420 151,591 Total liabilities 5,847,002 5,689,445 5,582,861 Stockholders' equity 547,766 542,553 487,531 Total liabilitiesand stockholders' $ 6,394,768 $ 6,231,998 $ 6,070,392 equity Net interest income/ interest rate $ 41,991 2.65 % $ 41,844 2.73 % $ 44,439 2.88 %spreadNet interest earningassets / net $ 3,294,957 2.75 % $ 3,151,939 2.85 % $ 3,086,243 3.10 %interest margin Total Cost of 0.10 % 0.11 % 0.20 %Deposits

(1) Amounts are net of deferred origination costs (fees) and the allowance for loan losses(2) Includes prepayment penalty interest income in 2Q2021, 1Q2021, and 2Q2020 of $504, $642, and $239 respectively (in thousands)

Net Interest Income Analysis Six Months Ended June 30, 2021 June 30, 2020 Average Income / Yield Average Income / Yield(In thousands) Balance Expense / Balance Expense / Rate Rate Interest earning assets:Interest-bearingdeposits in $ 445,340 $ 221 0.10 % $ 275,107 $ 479 0.35 %banksSecurities and 2,359,870 25,353 2.17 % 1,689,870 24,434 2.91 %FHLB stockTotal loans, net 3,228,235 61,265 3.83 % 3,517,799 70,837 4.05 %^ (1)(2)Total interest 6,033,445 86,839 2.90 % 5,482,776 95,750 3.51 %earning assetsNon-interest earning assets:Cash and due 7,432 42,208 from banksOther assets 272,930 223,643 Total assets $ 6,313,807 $ 5,748,627 Interest bearing liabilities:Savings, NOW andmoney market $ 2,540,277 $ 2,395 0.19 % $ 2,228,509 $ 4,492 0.41 %depositsTime deposits 269,063 608 0.46 % 376,011 2,104 1.13 %Total deposits 2,809,340 3,003 0.22 % 2,604,520 6,596 0.51 %Federal HomeLoan Bank 249 ? 0.00 % 3,187 27 1.70 %advancesTotal interestbearing 2,809,589 3,003 0.22 % 2,607,707 6,623 0.51 %liabilitiesNon-interestbearing liabilities:Demand andtransaction 2,848,401 2,523,764 depositsOther 110,654 122,450 liabilitiesTotal 5,768,644 5,253,921 liabilitiesStockholders' 545,163 494,706 equityTotalliabilities and $ 6,313,807 $ 5,748,627 stockholders'equity Net interestincome / $ 83,836 2.68 % $ 89,127 3.00 %interest ratespreadNet interestearning assets / $ 3,223,856 2.80 % $ 2,875,069 3.27 %net interestmargin Total Cost of 0.11 % 0.26 %Deposits

(1) Amounts are net of deferred origination costs (fees) and the allowance for loan losses(2) Includes prepayment penalty interest income in June YTD 2021 and June YTD 2020 of $1,146 and $1,001 respectively (in thousands)

Deposit Portfolio Composition (In thousands) June 30, 2021 March 31, 2021 June 30, 2020 Non-interest bearing demand $ 2,948,718 $ 2,819,627 $ 3,089,004 deposit accountsNOW accounts 200,758 206,145 198,653 Money market deposit 2,136,719 2,067,886 1,876,540 accountsSavings accounts 371,047 361,731 342,477 Time deposits 252,750 264,678 363,645 Total deposits $ 5,909,992 $ 5,720,067 $ 5,870,319

Three Months Ended June 30, 2021 March 31, 2021 June 30, 2020 Average Average Average Average Average Average(In thousands) Balance Rate Balance Rate Balance Rate Paid Paid Paid Non-interestbearing demand $ 2,909,554 0.00 % $ 2,786,581 0.00 % $ 2,746,529 0.00 %depositaccountsNOW accounts 204,341 0.08 % 198,117 0.08 % 237,279 0.17 %Money marketdeposit 1,993,643 0.21 % 1,963,707 0.23 % 1,741,466 0.36 %accountsSavings 369,412 0.10 % 351,068 0.11 % 335,027 0.12 %accountsTime deposits 258,257 0.40 % 280,057 0.51 % 370,969 0.99 %Total deposits $ 5,735,207 0.10 % $ 5,579,530 0.11 % $ 5,431,270 0.20 %

Asset Quality (In thousands) June 30, March 31, June 30, 2021 2021 2020Loans 90 days past due and accruing $ ? $ 2,424 $ ? Nonaccrual loans excluding held for sale 31,437 37,324 18,901 loans and restructured loansNonaccrual loans held for sale ? ? ? Troubled debt restructured loans - 20,494 20,578 26,776 nonaccrualTroubled debt restructured loans - accruing 18,683 17,656 28,031 Other real estate owned 307 2,988 503 Impaired securities 59 61 46 Total nonperforming assets $ 70,980 $ 81,031 $ 74,257 Nonaccrual loans: Commercial and industrial $ 14,561 $ 12,347 $ 15,742 Multifamily 10,266 7,660 ? Commercial real estate 4,066 4,133 13,768 Construction and land development ? 8,605 3,652 Total commercial portfolio 28,893 32,745 33,162 Residential real estate lending 22,320 24,300 11,835 Consumer and other 718 857 680 Total retail portfolio 23,038 25,157 12,515 Total nonaccrual loans $ 51,931 $ 57,902 $ 45,677 Nonaccrual loans to total loans 1.64 % 1.78 % 1.24 %Nonperforming assets to total assets 1.08 % 1.27 % 1.15 %Allowance for loan losses to nonaccrual 73.20 % 63.32 % 109.49 %loansAllowance for loan losses to total loans 1.20 % 1.13 % 1.36 %Annualized net charge-offs (recoveries) to 0.04 % 0.20 % 0.06 %average loans

Credit Quality June 30, 2021($ in Pass Special Substandard Doubtful Totalthousands) MentionCommercialand $ 568,878 $ 17,569 $ 32,133 $ 457 $ 619,037 industrialMultifamily 711,551 101,579 32,348 3,173 848,651 Commercial 234,018 45,236 72,453 ? 351,707 real estateConstructionand land 34,414 535 7,354 ? 42,303 developmentResidentialreal estate 1,063,176 295 22,320 ? 1,085,791 lendingConsumer and 221,835 ? 430 ? 222,265 otherTotal loans $ 2,833,872 $ 165,214 $ 167,038 $ 3,630 $ 3,169,754

March 31, 2021($ in Pass Special Substandard Doubtful Totalthousands) MentionCommercialand $ 566,421 $ 17,622 $ 28,079 $ 459 $ 612,581 industrialMultifamily 742,746 108,016 28,296 3,173 882,231 Commercial 257,178 32,878 74,252 ? 364,308 real estateConstructionand land 33,971 7,691 8,605 ? 50,267 developmentResidentialreal estate 1,113,551 ? 24,300 ? 1,137,851 lendingConsumer and 205,594 ? 857 ? 206,451 otherTotal loans $ 2,919,461 $ 166,207 $ 164,389 $ 3,632 $ 3,253,689

June 30, 2020($ in Pass Special Substandard Doubtful Totalthousands) MentionCommercialand $ 567,174 $ 15,493 $ 34,445 $ 467 $ 617,579 industrialMultifamily 966,067 6,062 ? ? 972,129 Commercial 388,170 1,439 14,455 ? 404,064 real estateConstructionand land 35,578 26,029 3,652 ? 65,259 developmentResidentialreal estate 1,421,785 ? 10,860 ? 1,432,645 lendingConsumer and 187,300 ? 680 ? 187,980 otherTotal loans $ 3,566,074 $ 49,023 $ 64,092 $ 467 $ 3,679,656

Reconciliation of GAAP to Non-GAAP Financial MeasuresThe information provided below presents a reconciliation of each of our non-GAAP financial measures to the most directly comparable GAAP financial measure.

As of and for the As of and for the Three Months Ended Six Months Ended(in June 30, March 31, June 30, June 30, June 30,thousands) 2021 2021 2020 2021 2020Coreoperating revenueNet Interest $ 41,991 $ 41,844 $ 44,439 $ 83,836 $ 89,127 incomeNon-interest 5,327 4,000 8,671 9,327 17,789 incomeLess: Branchsale loss ? ? 34 ? (1,394 )(gain)^ (1)Less:Securities (321 ) (18 ) (486 ) (339 ) (985 )gain, netCoreoperating $ 46,997 $ 45,826 $ 52,658 $ 92,824 $ 104,537 revenue Corenon-interest expenseNon-interest $ 31,395 $ 32,793 $ 31,068 $ 64,189 $ 63,339 expenseLess: Branchclosure ? ? (695 ) ? (2,051 )expense ^(2)Less:Severance ^ ? (1,090 ) ? (1,090 ) (76 )(3)Corenon-interest $ 31,395 $ 31,703 $ 30,373 $ 63,099 $ 61,212 expense Core net incomeNet Income $ 10,408 $ 12,189 $ 10,374 $ 22,598 $ 19,919 (GAAP)Less: Branchsale (gain) ^ ? ? 34 ? (1,394 )(1)Less:Securities (321 ) (18 ) (486 ) (339 ) (985 )loss (gain)Add: Branchclosure ? ? 695 ? 2,051 expense ^(2)Add:Severance ^ ? 1,090 ? 1,090 76 (3)Less: Tax on 86 (271 ) (61 ) (196 ) 64 notable itemsCore netincome $ 10,173 $ 12,990 $ 10,556 $ 23,153 $ 19,731 (non-GAAP) Tangible common equityStockholders' $ 548,211 $ 540,222 $ 503,702 $ 548,211 $ 503,702 Equity (GAAP)Less:Minority (133 ) (133 ) (134 ) (133 ) (134 )Interest(GAAP)Less:Goodwill (12,936 ) (12,936 ) (12,936 ) (12,936 ) (12,936 )(GAAP)Less: Coredeposit (4,755 ) (5,057 ) (6,043 ) (4,755 ) (6,043 )intangible(GAAP)Tangiblecommon equity $ 530,387 $ 522,096 $ 484,589 $ 530,387 $ 484,589 (non-GAAP) Averagetangible common equityAverageStockholders' $ 547,766 $ 542,553 $ 487,531 $ 545,163 $ 494,706 Equity (GAAP)Less:Minority (133 ) (133 ) (134 ) (133 ) (134 )Interest(GAAP)Less:Goodwill (12,936 ) (12,936 ) (12,936 ) (12,936 ) (12,936 )(GAAP)Less: Coredeposit (4,903 ) (5,205 ) (6,211 ) (5,052 ) (6,382 )intangible(GAAP)Averagetangible $ 529,794 $ 524,279 $ 468,250 $ 527,042 $ 475,254 common equity(non-GAAP) Core returnon average assetsCore netincome 10,173 12,990 10,556 23,153 19,731 (numerator)(non-GAAP)Divided:Total averageassets 6,394,768 6,231,998 6,070,392 6,313,807 5,748,627 (denominator)(GAAP)Core returnon average 0.64 % 0.85 % 0.70 % 0.74 % 0.69 %assets(non-GAAP) Core returnon average tangiblecommon equityCore netincome 10,173 12,990 10,556 23,153 19,731 (numerator)(non-GAAP)Divided:Averagetangible 529,794 524,279 468,250 527,042 475,254 common equity(denominator)(GAAP)Core returnon averagetangible 7.70 % 10.05 % 9.07 % 8.86 % 8.35 %common equity(non-GAAP) Coreefficiency ratioCorenon-interest 31,395 31,703 30,373 63,099 61,212 expense(numerator)Coreoperating 46,997 45,826 52,658 92,824 104,537 revenue(denominator)Coreefficiency 66.80 % 69.18 % 57.68 % 67.98 % 58.56 %ratio

(1) Fixed Asset branch sale in March 2020(2) Occupancy and other expense related to closure of branches during our branch rationalization(3) Salary and COBRA reimbursement expense for positions eliminated