Columbia Financial, Inc. (the “Company”) (NASDAQ: CLBK), the
mid-tier holding company for Columbia Bank ("Columbia") and
Freehold Bank ("Freehold"), reported net income of $23.3 million,
or $0.23 per basic and diluted share, for the quarter ended
December 31, 2021, as compared to net income of $20.7 million,
or $0.19 per basic and diluted share, for the quarter ended
December 31, 2020. Earnings for the quarter ended
December 31, 2021 reflected higher net interest income and a
lower provision for loan losses, partially offset by lower
non-interest income, higher non-interest expense and higher income
tax expense. The Company successfully completed its acquisition of
Freehold MHC, Freehold Bancorp and Freehold Bank on December 1,
2021. Freehold Bank will continue to operate as a wholly owned
subsidiary of the Company for at least two years.
For the year ended December 31, 2021, the
Company reported net income of $92.0 million, or $0.88 per basic
and diluted share, as compared to net income of $57.6 million, or
$0.52 per basic and diluted share, for the year ended
December 31, 2020. Earnings for the year ended
December 31, 2021 reflected higher net interest income, a
lower provision for loan losses, higher non-interest income and
lower non-interest expense, partially offset by higher income tax
expense.
Thomas J. Kemly, President and Chief Executive
Officer commented: "During 2021, the Company achieved outstanding
core profitability performance as our net income increased $34.4
million, or 59.8%, over 2020, and we increased our earnings per
share by 69.2% to $0.88 for the year ended December 31, 2021,
from $0.52 for year ended December 31, 2020. On December 1, 2021,
we successfully completed our acquisition of Freehold Bank and
announced our pending acquisition of RSI Bank. This past year has
been full of unique challenges resulting from the continued
disruptions from the pandemic, and we supported community recovery
efforts by participating in the Paycheck Protection Program ("PPP")
as well as providing loan deferral relief for both our residential
and commercial loan clients. We remained focused in our commitment
to personalized service, and continued to deliver results for our
Company and our clients. We invested in new technological
initiatives to improve the customer experience, increased product
offerings, increased revenue and improved efficiency, all which
have contributed to enhance the strength of our Company."
Results of Operations for the Quarters
Ended December 31, 2021 and December 31,
2020
Net income of $23.3 million was recorded for the
quarter ended December 31, 2021, an increase of $2.7 million,
or 13.0%, compared to net income of $20.7 million for the quarter
ended December 31, 2020. The increase in net income was
primarily attributable to a $2.3 million increase in net interest
income, and an $8.0 million decrease in provision for loan losses,
partially offset by a $3.0 million decrease in non-interest income,
a $2.6 million increase in non-interest expense, and a $2.1 million
increase in income tax expense.
Net interest income was $61.0 million for the
quarter ended December 31, 2021, an increase of $2.3 million,
or 3.9%, from $58.7 million for the quarter ended December 31,
2020. The increase in net interest income was primarily
attributable to a $6.2 million decrease in interest expense,
resulting from a decrease in both interest expense on deposits and
interest expense on borrowings, partially offset by a $3.9 million
decrease in interest income. The decrease in interest expense on
deposits was driven by both an inflow of lower cost deposits and
the repricing of existing deposits at reduced rates as a result of
a sustained lower interest rate environment. The decrease in
interest expense on borrowings was the result of decreases in both
the average balance and average cost of borrowings. During the
quarter ended December 31, 2021, $439.0 million of Federal
Home Loan Bank of New York ("FHLB") borrowings were prepaid. The
decrease in interest income for the quarter ended December 31,
2021 was largely due to decreases in the average yields on loans
and securities. Prepayment penalties, which are included in
interest income on loans, totaled $2.2 million for the quarter
ended December 31, 2021, compared to $1.8 million for the
quarter ended December 31, 2020.
The average yield on loans for the quarter ended
December 31, 2021 decreased 31 basis points to 3.66%, as
compared to 3.97% for the quarter ended December 31, 2020,
while the average yield on securities for the quarter ended
December 31, 2021 decreased 29 basis points to 2.01%, as
compared to 2.30% for the quarter ended December 31, 2020.
Decreases in the average yields on these portfolios for the quarter
ended December 31, 2021 were influenced by the sustained lower
interest rate environment. The Federal Reserve reduced interest
rates by 150 basis points in March 2020 in response to the COVID-19
pandemic, and rates have remained low throughout 2021 with record
levels of liquidity injected into the banking system as a result of
pandemic related stimulus programs. The average yield on other
interest-earning assets for the quarter ended December 31,
2021 increased 3 basis points to 0.71%, as compared to 0.68% for
the quarter ended December 31, 2020, as the average cash
balances in lower yielding bank accounts decreased for the quarter
ended December 31, 2021.
Total interest expense was $7.6 million for the
quarter ended December 31, 2021, a decrease of $6.2 million,
or 44.9%, from $13.8 million for the quarter ended
December 31, 2020. The decrease in interest expense was
primarily attributable to a 39 basis point decrease in the average
cost of interest-bearing deposits which was partially offset by the
impact of the increase in the average balance of deposits. The
decrease in the cost of deposits was driven by both an inflow of
lower cost deposits and the repricing of existing deposits at lower
interest rates. Interest on borrowings decreased $1.2 million, or
39.3%, due to a decrease in the average balance of borrowings
primarily due to the prepayment of FHLB borrowings, coupled with a
24 basis point decrease in the cost of total borrowings.
The Company's net interest margin for the
quarter ended December 31, 2021 decreased 2 basis points to
2.79%, when compared to 2.81% for the quarter ended
December 31, 2020. The weighted average yield on
interest-earning assets decreased 33 basis points to 3.14% for the
quarter ended December 31, 2021 as compared to 3.47% for the
quarter ended December 31, 2020. The average cost of
interest-bearing liabilities decreased 39 basis points to 0.47% for
the quarter ended December 31, 2021 as compared to 0.86% for
the quarter ended December 31, 2020. The decrease in yields
and costs for the quarter ended December 31, 2021 were largely
driven by a continued lower interest rate environment, coupled with
the utilization of excess liquidity to prepay higher costing FHLB
borrowings.
The reversal of provision for loan loss recorded
for the quarter ended December 31, 2021 was $7.4 million, a
decrease of $8.0 million, from $627,000 of provision for loan loss
expense recorded for the quarter ended December 31, 2020. The
comparatively lower level of provision for the 2021 period was
primarily attributable to a decrease in loan loss rates, a decrease
in the balances of delinquent and non-accrual loans, and the
consideration of the improving economic environment.
Non-interest income was $7.0 million for the
quarter ended December 31, 2021, a decrease of $3.0 million,
or 30.0%, from $10.0 million for the quarter ended
December 31, 2020. The decrease was primarily attributable to
a decrease in income from the gain on the sale of loans of $2.0
million and a decrease in the change in fair value of equity
securities of $695,000.
Non-interest expense was $43.4 million for the
quarter ended December 31, 2021, an increase of $2.6 million,
or 6.3%, from $40.8 million for the quarter ended December 31,
2020. The increase was primarily attributable to an increase in
compensation and employee benefits expense of $3.7 million, an
increase in merger-related expenses of $692,000, and an increase in
the loss on the extinguishment of debt of $1.0 million, partially
offset by a decrease in other non-interest expense of $4.0 million.
The increase in compensation and employee benefits expense was due
to the increase in the number of employees as a result of recent
mergers, along with normal annual increases in salaries and
bonuses. The increase in merger-related expenses primarily related
to the acquisition of Freehold Bank in the 2021 period. During the
quarter ended December 31, 2021, the Company utilized excess
liquidity to prepay $439.0 million in borrowings and also
terminated related derivative contracts, which resulted in a $2.1
million loss on early extinguishment of debt. The decrease in other
non-interest expense was primarily attributable to a $3.0 million
decrease in pension plan expense.
Income tax expense was $8.6 million for the
quarter ended December 31, 2021, an increase of $2.1 million,
as compared to $6.5 million for the quarter ended December 31,
2020, mainly due to an increase in pre-tax income, and to a lesser
extent, an increase in the Company's effective state income tax
rate. The Company's effective tax rate was 27.0% and 24.1% for the
quarters ended December 31, 2021 and 2020, respectively.
Results of Operations for the Years
Ended December 31, 2021 and December 31,
2020
Net income of $92.0 million was recorded for the
year ended December 31, 2021, an increase of $34.4 million, or
59.8%, compared to net income of $57.6 million for the year ended
December 31, 2020. The increase in net income was primarily
attributable to a $11.6 million increase in net interest income, a
$28.4 million decrease in provision for loan losses, a $7.6 million
increase in non-interest income, and a $2.4 million decrease in
non-interest expense, partially offset by a $15.5 million increase
in income tax expense.
Net interest income was $233.1 million for the
year ended December 31, 2021, an increase of $11.6 million, or
5.2%, from $221.6 million for the year ended December 31,
2020. The increase in net interest income was primarily
attributable to a $37.1 million decrease in interest expense,
resulting from a decrease in both interest expense on deposits and
interest expense on borrowings, partially offset by a $25.6 million
decrease in interest income. The decrease in interest expense on
deposits was driven by both an inflow of lower cost deposits and
the repricing of existing deposits at reduced rates as a result of
a lower interest rate environment. The decrease in interest expense
on borrowings was the result of decreases in both the average
balance and average cost of borrowings. During the year ended
December 31, 2021, $495.5 million of FHLB borrowings were
prepaid. The decrease in interest income for the year ended
December 31, 2021 was largely due to decreases in the average
yields on interest-earning assets. Prepayment penalties, which are
included in interest income on loans, totaled $5.0 million for the
year ended December 31, 2021, compared to $3.8 million for the
year ended December 31, 2020.
The average yield on loans for the year ended
December 31, 2021 decreased 25 basis points to 3.73%, as
compared to 3.98% for the year ended December 31, 2020, while
the average yield on securities for the year ended
December 31, 2021 decreased 50 basis points to 1.98%, as
compared to 2.48% for the year ended December 31, 2020. The
average yield on other interest-earning assets for the year ended
December 31, 2021 decreased 90 basis points to 0.70%, as
compared to 1.60% for the year ended December 31, 2020, as
there were substantially higher cash balances in low yielding bank
accounts for the year ended December 31, 2021. Decreases in
the average yields on these portfolios for the year ended
December 31, 2021 were influenced by the lower interest rate
environment as the Federal Reserve reduced interest rates in early
2020 in response to the COVID-19 pandemic.
Total interest expense was $37.0 million for the
year ended December 31, 2021, a decrease of $37.1 million, or
50.1%, from $74.1 million for the year ended December 31,
2020. The decrease in interest expense was primarily attributable
to a 55 basis point decrease in the average cost of
interest-bearing deposits which was partially offset by the impact
of the increase in the average balance of deposits. The decrease in
the cost of deposits was driven by both an inflow of lower cost
deposits and the repricing of existing deposits at lower interest
rates. Interest on borrowings decreased $11.0 million due to a
decrease in the average balance of borrowings, coupled with a 57
basis point decrease in the cost of total borrowings. During the
year ended December 31, 2021, the Company prepaid $495.5
million of FHLB borrowings with an average rate of 1.35% and
original contractual maturities through 2024. The prepayments were
funded by excess cash liquidity. The transactions were accounted
for as early debt extinguishments resulting in a loss of $1.9
million.
The Company's net interest margin for the year
ended December 31, 2021 increased 4 basis points to 2.76%,
when compared to 2.72% for the year ended December 31, 2020.
The weighted average yield on interest-earning assets decreased 44
basis points to 3.20% for the year ended December 31, 2021 as
compared to 3.64% for the year ended December 31, 2020.
Excluding the impact of the acceleration of PPP loan deferred fee
for the year ended December 31, 2021, the net interest margin
would have been 2.67%. The average cost of interest-bearing
liabilities decreased 59 basis points to 0.58% for the year ended
December 31, 2021 as compared to 1.17% for the year ended
December 31, 2020. The decreases in yields and costs for the
year ended December 31, 2021 were largely driven by a
continued lower interest rate environment. The net interest margin
increased for the year ended December 31, 2021 as the cost of
interest-bearing liabilities continued to reprice lower more
rapidly than the yields on interest-earning assets.
The reversal of provision for loan loss recorded
for the year ended December 31, 2021 was $10.0 million, a
decrease of $28.4 million, from $18.4 million of provision for loan
loss expense recorded for the year ended December 31, 2020.
The comparatively lower level of provision for the 2021 period was
primarily attributable to a decrease in loan loss rates, a decrease
in the balances of delinquent and non-accrual loans, and the
consideration of the improving economic environment.
Non-interest income was $38.8 million for the
year ended December 31, 2021, an increase of $7.6 million, or
24.2%, from $31.3 million for the year ended December 31,
2020. The increase was primarily attributable to an increase in
title insurance fees of $1.1 million, an increase in the income
from gains on securities transactions of $1.7 million, an increase
in income from the gain on the sale of loans of $5.3 million and an
increase in other non-interest income of $2.0 million, partially
offset by a decrease in the fair value of equity securities of $2.6
million. The increase in the gain on sale of loans was primarily
attributable to a gain of $7.7 million resulting from the sale of
$237.0 million of commercial business loans granted as part of the
Small Business Administration PPP. Other non-interest income
includes an increase of $1.0 million from debit card
transactions.
Non-interest expense was $155.7 million for the
year ended December 31, 2021, a decrease of $2.4 million, or
1.5%, from $158.1 million for the year ended December 31,
2020. The decrease was primarily attributable to a decrease in
merger-related expenses of $1.1 million, and a decrease in other
non-interest expense of $5.7 million, partially offset by an
increase in professional fees of $1.6 million, an increase in data
processing and software expenses of $1.2 million, and an increase
in the loss on the extinguishment of debt of $1.7 million.
Merger-related expenses recorded for the year ended December 31,
2020 related to the completed acquisitions of Stewardship Financial
Corporation and Roselle Bank, while 2021 merger-related expenses
primarily related to the acquisition of Freehold Bank, which will
be fully integrated into the Company within two years. The decrease
in other non-interest expense was primarily attributable to a $6.0
million decrease in pension plan expense. Professional fees
included an increase in consulting expenses related to information
technology, and the increase in data processing and software
expenses was attributable to the purchase and implementation of
several digital banking and other Fintech solutions, as well as the
amortization of software costs related to a digital small business
lending solution. As noted above, during the year ended
December 31, 2021, the Company utilized excess liquidity to
prepay $495.5 million in borrowings and also terminated related
derivative contracts, which resulted in a $2.9 million loss on the
early extinguishment of debt.
Income tax expense was $34.1 million for the
year ended December 31, 2021, an increase of $15.5 million, as
compared to $18.7 million for the year ended December 31,
2020, mainly due to an increase in pre-tax income, and to a lesser
extent, an increase in the Company's effective state income tax
rate. The Company's effective tax rate was 27.1% and 24.5% for the
year ended December 31, 2021 and 2020, respectively.
Balance Sheet Summary
Total assets increased $425.6 million, or 4.8%,
to $9.2 billion at December 31, 2021 from $8.8 billion at
December 31, 2020. The increase in total assets was primarily
attributable to increases in debt securities available for sale of
$386.9 million, debt securities held to maturity of $167.0 million,
loans receivable, net of $190.8 million, and other assets of $39.8
million, partially offset by decreases of $352.0 million in cash
and cash equivalents, and $20.6 million in Federal Home Loan Bank
stock.
Cash and cash equivalents decreased $352.0
million, or 83.2%, to $71.0 million at December 31, 2021 from
$423.0 million at December 31, 2020. The decrease was
primarily attributable to $870.9 million in purchases of debt
securities available for sale and held to maturity, $107.8 million
in repurchases of common stock under our stock repurchase program,
and $495.5 million in prepayments of borrowings, partially offset
by an increase in repayments on loans, repayments on
mortgage-backed securities, growth in deposits and $20.4 million in
cash and cash equivalents acquired in the Freehold acquisition.
Debt securities available for sale increased
$386.9 million, or 29.4%, to $1.7 billion at December 31, 2021
from $1.3 billion at December 31, 2020. The increase was
attributable to purchases of $667.0 million of securities primarily
consisting of U.S. government and agency obligations,
mortgage-backed securities and municipal securities, and $99.6
million in purchases of guarantor swaps with Freddie Mac, partially
offset by maturities, calls and sales of $104.5 million in U.S.
government and agency obligations, corporate debt and municipal
securities, and repayments of $354.1 million. The gross unrealized
gain (loss) on debt securities available for sale decreased by
$36.9 million during the year ended December 31, 2021.
Debt securities held to maturity increased
$167.0 million, or 63.6%, to $429.7 million at December 31,
2021 from $262.7 million at December 31, 2020. The increase
was primarily attributable to purchases of $203.8 million of
securities primarily consisting of U.S. agency obligations and
mortgage-backed securities, partially offset by calls of $5.1
million in U.S. agency obligations and repayments of $31.0
million.
Federal Home Loan Bank stock decreased $20.6
million, or 47.1%, to $23.1 million at December 31, 2021 from
$43.8 million at December 31, 2020. The decrease was
attributable to the redemption of stock as required upon repayment
of FHLB borrowings.
Loans receivable, net, increased $190.8 million,
or 3.1%, to $6.3 billion at December 31, 2021 from $6.1
billion at December 31, 2020. One-to-four family real estate
loans and multifamily and commercial real estate loans increased
$152.0 million and $393.4 million, respectively, partially offset
by decreases in commercial business loans, construction loans, and
home equity loans and advances of $300.6 million, $33.7 million,
and $44.6 million, respectively. Loans receivable, net, for the
year ended December 31, 2021 also included $158.9 million of loans
which were acquired due to the Freehold acquisition, which mainly
consisted of one-to four family and multifamily and commercial real
estate loans. The increase in one-to-four family real estate loans
included the purchase of $11.8 million in loans from a third party.
The increase in multi-family and commercial real estate loans
included the purchase of $73.6 million of loan participations. The
decrease in commercial business loans was mainly due to the sale of
$237.0 million in loans granted and $277.7 million in forgiven PPP
loans included as part of the Small Business Administration PPP.
The allowance for loan loss balance decreased $12.0 million to
$62.7 million at December 31, 2021 from $74.7 million at
December 31, 2020, which was primarily attributable to a
decrease in loan loss rates, and a decrease in the balance of
delinquent and non-accrual loans, as well as the consideration of
improving economic conditions. The current allowance for loan
losses was calculated utilizing the existing incurred loss
methodology. The Company elected to defer the adoption of the
Current Expected Credit Loss ("CECL") methodology as was originally
permitted by the CARES Act and the Consolidated Appropriations Act,
2021, which, when enacted, extended certain provisions of the CARES
Act. The Company adopted CECL on January 1, 2022.
Other assets increased $39.8 million, or 18.9%,
to $249.6 million at December 31, 2021 from $209.9 million at
December 31, 2020. The increase in other assets consisted of
an increase of $82.2 million in the Company's pension plan balance,
partially offset by a decrease of $24.1 million in the collateral
balance related to our swap agreement obligations, and a decrease
of $9.9 million in interest rate swap assets. The 2020 period also
included net deferred tax assets totaling $7.2 million.
Total liabilities increased $357.8 million, or
4.6%, to $8.1 billion at December 31, 2021 from $7.8 billion
at December 31, 2020. The increase was primarily attributable
to an increase in total deposits of $791.6 million, or 11.7%,
partially offset by a decrease in borrowings of $422.1 million, or
52.8%, and a decrease in accrued expenses and other liabilities of
$15.7 million, or 8.9%. The increase in total deposits consisted of
increases in non-interest-bearing and interest-bearing demand
deposits of $357.5 million and $410.8 million, respectively, and
money market accounts and savings and club deposits of $69.0
million and $134.5 million, respectively, partially offset by a
decrease in certificates of deposit accounts of $180.2 million. In
addition, the increase in deposits included $210.1 million in
deposits assumed in connection with the Freehold acquisition. The
decrease in borrowings was primarily driven by the prepayment of
$495.5 million of FHLB borrowings. The decrease in accrued expenses
and other liabilities primarily consisted of a $24.6 million
decrease in interest rate swap liabilities, partially offset by an
increase in net deferred tax liabilities of $9.7 million, primarily
due to the change in the Company's pension plan balance.
Total stockholders’ equity increased $67.8
million, or 6.7%, to $1.1 billion at December 31, 2021 from
$1.0 billion at December 31, 2020. The increase was primarily
attributable to net income of $92.0 million, an increase in paid in
capital of $47.2 million due to the issuance of 2,591,007 shares of
Company common stock to Columbia Bank MHC in connection with the
Freehold acquisition, and a change in the pension obligation of
$41.2 million, partially offset by the repurchase of 6,055,119
shares of common stock totaling $107.8 million under our stock
repurchase program.
Asset Quality
The Company's non-performing loans at
December 31, 2021 totaled $3.9 million, or 0.06% of total
gross loans, as compared to $8.2 million, or 0.13% of total gross
loans, at December 31, 2020. The $4.2 million decrease in
non-performing loans was primarily attributable to decreases of
$1.2 million in non-performing one-to-four family real estate
loans, $2.0 million in non-performing commercial business loans,
and $478,000 in non-performing home equity loans and advances. The
decrease in non-performing one-to-four family real estate loans was
due to a decrease in the number of loans from 13 non-performing
loans at December 31, 2020 to six non-performing loans at
December 31, 2021. The decrease in non-performing commercial
business loans was due to charge-offs totaling $2.0 million. The
decrease in non-performing home equity loans and advances was due
to a decrease in the number of loans from 12 non-performing loans
at December 31, 2020 to four non-performing loans at
December 31, 2021. Non-performing assets as a percentage of
total assets totaled 0.04% at December 31, 2021 as compared to
0.09% at December 31, 2020.
For the quarter ended December 31, 2021,
net charge-offs totaled $245,000 as compared to $2.1 million for
the quarter ended December 31, 2020. For the year ended
December 31, 2021, net charge-offs totaled $2.0 million as
compared to $5.5 million for the year ended December 31,
2020.
The Company's allowance for loan losses was
$62.7 million, or 0.99% of total gross loans, at December 31,
2021, compared to $74.7 million, or 1.21% of total gross loans, at
December 31, 2020. The decrease in the allowance for loan
losses was primarily attributable to a decrease in loan loss rates,
and a decrease in the balance of delinquent and non-accrual loans,
as well as the consideration of improving economic conditions.
Stock Repurchase Program
During the year ended December 31, 2021,
the Company repurchased 6,055,119 shares of common stock at a cost
of $107.8 million, or $17.80 per share, and during the quarter
ended December 31, 2021, the Company repurchased 1,421,579
shares of common stock at a cost of $28.7 million, or $20.18 per
share. As of January 22, 2022, there are 4,441,339 shares remaining
to be repurchased under this existing program.
COVID-19
At December 31, 2021, there were four loans
on deferral for $24.3 million, a decrease of $3.7 million, compared
to $28.0 million at September 30, 2021, and a decrease of $60.8
million, compared to $85.1 million at December 31, 2020. These
short-term loan modifications are treated in accordance with
Section 4013 of the CARES Act and are not treated as troubled debt
restructurings during the short-term modification period if the
loan was not in arrears. The Consolidated Appropriations Act, 2021,
which was enacted in late December 2020, extended certain
provisions of the CARES Act through January 1, 2022, including
provisions permitting loan deferral extension requests to not be
treated as troubled debt restructurings.
At December 31, 2021, two loans totaling
approximately $24.3 million are remitting partial payments.
Merger with RSI
On December 1, 2021, the Company announced the
signing of a definitive agreement and plan of merger pursuant to
which the Company will acquire RSI Bancorp, M.H.C., RSI Bancorp,
Inc. and RSI Bank (collectively, the “RSI Entities”). As part of
the transaction, the Company will issue additional shares of its
common stock to Columbia Bank, MHC in an amount equal to the fair
value of the RSI Entities as determined by an independent
appraiser. Subject to the receipt of all required regulatory
approvals and the satisfaction of customary closing conditions, the
Company expects to complete its acquisition of the RSI Entities in
the second quarter of 2022.
Annual Meeting of
Stockholders
On January 25, 2022, the Company also announced
that its annual meeting of stockholders will be held on June 22,
2022.
About Columbia Financial,
Inc.
The consolidated financial results include the
accounts of Columbia Financial, Inc., its wholly-owned subsidiaries
Columbia Bank and Freehold Bank, and their wholly-owned
subsidiaries. Columbia Financial, Inc. is a Delaware corporation
organized as Columbia Bank's mid-tier stock holding company.
Columbia Financial, Inc. is a majority-owned subsidiary of Columbia
Bank MHC. Columbia Bank is a federally chartered savings bank
headquartered in Fair Lawn, New Jersey that operates 62
full-service banking offices. Freehold Bank is a federally
chartered savings bank headquartered in Freehold, New Jersey that
operates 2 full-service banking offices. Both Banks offer
traditional financial services to consumers and businesses in their
market areas.
Forward Looking Statements
Certain statements herein constitute
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Exchange
Act and are intended to be covered by the safe harbor provisions of
the Private Securities Litigation Reform Act of 1995. Such
statements may be identified by words such as “believes,” “will,”
“would,” “expects,” “projects,” “may,” “could,” “developments,”
“strategic,” “launching,” “opportunities,” “anticipates,”
“estimates,” “intends,” “plans,” “targets” and similar expressions.
These statements are based upon the current beliefs and
expectations of the Company’s management and are subject to
significant risks and uncertainties. Actual results may differ
materially from those set forth in the forward-looking statements
as a result of numerous factors. Factors that could cause such
differences to exist include, but are not limited to, adverse
conditions in the capital and debt markets and the impact of such
conditions on the Company’s business activities; changes in
interest rates; competitive pressures from other financial
institutions; the effects of general economic conditions on a
national basis or in the local markets in which the Company
operates, including changes that adversely affect a borrowers’
ability to service and repay the Company’s loans; the effect of the
COVID-19 pandemic, including on our credit quality and business
operations, as well as its impact on general economic and financial
market conditions; changes in the value of securities in the
Company’s portfolio; changes in loan default and charge-off rates;
fluctuations in real estate values; the adequacy of loan loss
reserves; decreases in deposit levels necessitating increased
borrowing to fund loans and securities; legislative changes and
changes in government regulation; changes in accounting standards
and practices; the risk that goodwill and intangibles recorded in
the Company’s consolidated financial statements will become
impaired; demand for loans in the Company’s market area; the
Company’s ability to attract and maintain deposits; risks related
to the implementation of acquisitions, dispositions, and
restructurings; the risk that the Company may not be successful in
the implementation of its business strategy, including the
successful consummation of its pending acquisition of RSI Bank, or
its integration of acquired financial institutions and businesses,
and changes in assumptions used in making such forward-looking
statements which are subject to numerous risks and uncertainties,
including but not limited to, those set forth in Item 1A of the
Company's Annual Report on Form 10-K and those set forth in the
Company's Quarterly Reports on Form 10-Q and Current Reports on
Form 8-K, all as filed with the Securities and Exchange Commission
(the “SEC”), which are available at the SEC’s website, www.sec.gov.
Should one or more of these risks materialize or should underlying
beliefs or assumptions prove incorrect, the Company's actual
results could differ materially from those discussed. Readers are
cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date of this release. The
Company disclaims any obligation to publicly update or revise any
forward-looking statements to reflect changes in underlying
assumptions or factors, new information, future events or other
changes, except as required by law.
Non-GAAP Financial Measures
Reported amounts are presented in accordance
with U.S. generally accepted accounting principles ("GAAP"). This
press release also contains certain supplemental non-GAAP
information that the Company’s management uses in its analysis of
the Company’s financial results. Specifically, the Company provides
measures based on what it believes are its operating earnings on a
consistent basis, and excludes material non-routine operating items
which affect the GAAP reporting of results of operations. The
Company’s management believes that providing this information to
analysts and investors allows them to better understand and
evaluate the Company’s core financial results for the periods
presented. Because non-GAAP financial measures are not
standardized, it may not be possible to compare these financial
measures with other companies' non-GAAP financial measures having
the same or similar names.
The Company also provides measurements and
ratios based on tangible stockholders' equity. These measures are
commonly utilized by regulators and market analysts to evaluate a
company’s financial condition and, therefore, the Company’s
management believes that such information is useful to
investors.
A reconciliation of GAAP to non-GAAP financial
measures are included at the end of this press release. See
"Reconciliation of GAAP to Non-GAAP Financial Measures".
COLUMBIA FINANCIAL, INC. AND
SUBSIDIARIESConsolidated Statements of Financial
Condition(In thousands)
|
December 31, |
|
|
2021 |
|
|
2020 |
Assets |
(Unaudited) |
|
|
Cash and due from banks |
$ |
70,702 |
|
$ |
422,787 |
Short-term investments |
|
261 |
|
|
170 |
Total cash and cash equivalents |
|
70,963 |
|
|
422,957 |
|
|
|
|
Debt securities available for sale, at fair value |
|
1,703,847 |
|
|
1,316,952 |
Debt securities held to maturity, at amortized cost (fair value of
$434,789, and $277,091 at December 31, 2021 and 2020,
respectively) |
|
429,734 |
|
|
262,720 |
Equity securities, at fair value |
|
2,710 |
|
|
5,418 |
Federal Home Loan Bank stock |
|
23,141 |
|
|
43,759 |
Loans held-for-sale, at fair value |
|
— |
|
|
4,146 |
|
|
|
|
Loans receivable |
|
6,360,601 |
|
|
6,181,770 |
Less: allowance for loan losses |
|
62,689 |
|
|
74,676 |
Loans receivable, net |
|
6,297,912 |
|
|
6,107,094 |
|
|
|
|
Accrued interest receivable |
|
28,300 |
|
|
29,456 |
Real estate owned |
|
— |
|
|
— |
Office properties and equipment, net |
|
78,708 |
|
|
75,974 |
Bank-owned life insurance |
|
247,474 |
|
|
232,824 |
Goodwill and intangible assets |
|
91,693 |
|
|
87,384 |
Other assets |
|
249,615 |
|
|
209,852 |
Total assets |
$ |
9,224,097 |
|
$ |
8,798,536 |
|
|
|
|
Liabilities and Stockholders' Equity |
|
|
|
Liabilities: |
|
|
|
Deposits |
$ |
7,570,216 |
|
$ |
6,778,624 |
Borrowings |
|
377,309 |
|
|
799,364 |
Advance payments by borrowers for taxes and insurance |
|
36,471 |
|
|
32,570 |
Accrued expenses and other liabilities |
|
161,021 |
|
|
176,691 |
Total liabilities |
|
8,145,017 |
|
|
7,787,249 |
|
|
|
|
Stockholders' equity: |
|
|
|
Total stockholders' equity |
|
1,079,081 |
|
|
1,011,287 |
Total liabilities and stockholders' equity |
$ |
9,224,098 |
|
$ |
8,798,536 |
|
|
|
COLUMBIA FINANCIAL, INC. AND
SUBSIDIARIESConsolidated Statements of
Income(In thousands, except share and per share
data)
|
Three Months Ended December 31, |
|
Year Ended December 31, |
|
|
2021 |
|
|
|
2020 |
|
|
2021 |
|
|
|
2020 |
Interest income: |
(Unaudited) |
|
(Unaudited) |
|
|
Loans receivable |
$ |
56,939 |
|
|
$ |
62,725 |
|
$ |
228,841 |
|
|
$ |
255,236 |
Debt securities available for sale and equity securities |
|
8,690 |
|
|
|
6,722 |
|
|
30,211 |
|
|
|
28,376 |
Debt securities held to maturity |
|
2,376 |
|
|
|
2,218 |
|
|
8,632 |
|
|
|
8,025 |
Federal funds and interest-earning deposits |
|
120 |
|
|
|
126 |
|
|
430 |
|
|
|
413 |
Federal Home Loan Bank stock dividends |
|
454 |
|
|
|
710 |
|
|
2,036 |
|
|
|
3,661 |
Total interest income |
|
68,579 |
|
|
|
72,501 |
|
|
270,150 |
|
|
|
295,711 |
Interest expense: |
|
|
|
|
|
|
|
Deposits |
|
5,706 |
|
|
|
10,677 |
|
|
29,109 |
|
|
|
55,246 |
Borrowings |
|
1,911 |
|
|
|
3,148 |
|
|
7,907 |
|
|
|
18,892 |
Total interest expense |
|
7,617 |
|
|
|
13,825 |
|
|
37,016 |
|
|
|
74,138 |
|
|
|
|
|
|
|
|
Net interest income |
|
60,962 |
|
|
|
58,676 |
|
|
233,134 |
|
|
|
221,573 |
|
|
|
|
|
|
|
|
(Reversal of) provision for
loan losses |
|
(7,392 |
) |
|
|
627 |
|
|
(9,953 |
) |
|
|
18,447 |
|
|
|
|
|
|
|
|
Net interest income after (reversal of) provision for loan
losses |
|
68,354 |
|
|
|
58,049 |
|
|
243,087 |
|
|
|
203,126 |
|
|
|
|
|
|
|
|
Non-interest income: |
|
|
|
|
|
|
|
Demand deposit account fees |
|
1,121 |
|
|
|
927 |
|
|
3,803 |
|
|
|
3,633 |
Bank-owned life insurance |
|
1,519 |
|
|
|
2,153 |
|
|
5,994 |
|
|
|
6,620 |
Title insurance fees |
|
1,534 |
|
|
|
1,589 |
|
|
6,088 |
|
|
|
5,034 |
Loan fees and service charges |
|
774 |
|
|
|
593 |
|
|
2,983 |
|
|
|
2,419 |
Gain on securities transactions |
|
10 |
|
|
|
— |
|
|
2,025 |
|
|
|
370 |
Change in fair value of equity securities |
|
17 |
|
|
|
712 |
|
|
(1,792 |
) |
|
|
767 |
(Loss) gain on sale of loans |
|
(24 |
) |
|
|
2,022 |
|
|
10,790 |
|
|
|
5,444 |
Other non-interest income |
|
2,020 |
|
|
|
1,966 |
|
|
8,940 |
|
|
|
6,983 |
Total non-interest income |
|
6,971 |
|
|
|
9,962 |
|
|
38,831 |
|
|
|
31,270 |
|
|
|
|
|
|
|
|
Non-interest expense: |
|
|
|
|
|
|
|
Compensation and employee benefits |
|
28,028 |
|
|
|
24,338 |
|
|
99,534 |
|
|
|
100,687 |
Occupancy |
|
5,159 |
|
|
|
4,851 |
|
|
20,071 |
|
|
|
19,170 |
Federal deposit insurance premiums |
|
623 |
|
|
|
551 |
|
|
2,374 |
|
|
|
1,901 |
Advertising |
|
498 |
|
|
|
566 |
|
|
2,358 |
|
|
|
2,641 |
Professional fees |
|
2,156 |
|
|
|
1,681 |
|
|
7,363 |
|
|
|
5,810 |
Data processing and software expenses |
|
3,316 |
|
|
|
2,865 |
|
|
11,497 |
|
|
|
10,285 |
Merger-related expenses |
|
692 |
|
|
|
— |
|
|
822 |
|
|
|
1,931 |
Loss on extinguishment of debt |
|
2,109 |
|
|
|
1,158 |
|
|
2,851 |
|
|
|
1,158 |
Other non-interest expense |
|
791 |
|
|
|
4,800 |
|
|
8,867 |
|
|
|
14,556 |
Total non-interest expense |
|
43,372 |
|
|
|
40,810 |
|
|
155,737 |
|
|
|
158,139 |
|
|
|
|
|
|
|
|
Income before income tax expense |
|
31,953 |
|
|
|
27,201 |
|
|
126,181 |
|
|
|
76,257 |
|
|
|
|
|
|
|
|
Income tax expense |
|
8,619 |
|
|
|
6,547 |
|
|
34,132 |
|
|
|
18,654 |
|
|
|
|
|
|
|
|
Net income |
$ |
23,334 |
|
|
$ |
20,654 |
|
$ |
92,049 |
|
|
$ |
57,603 |
|
|
|
|
|
|
|
|
Earnings per share-basic and
diluted |
$ |
0.23 |
|
|
$ |
0.19 |
|
$ |
0.88 |
|
|
$ |
0.52 |
Weighted average shares
outstanding-basic |
|
103,175,662 |
|
|
|
108,499,658 |
|
|
104,156,112 |
|
|
|
109,755,924 |
Weighted average shares
outstanding-diluted |
|
103,441,082 |
|
|
|
108,499,658 |
|
|
104,156,112 |
|
|
|
109,755,924 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COLUMBIA FINANCIAL, INC. AND
SUBSIDIARIESAverage Balances/Yields
|
For the Three Months Ended December 31, |
|
2021 |
|
2020 |
|
Average Balance |
|
Interest and Dividends |
|
Yield / Cost |
|
Average Balance |
|
Interest and Dividends |
|
Yield / Cost |
|
(Dollars in thousands) |
Interest-earnings assets: |
|
|
|
|
|
|
|
|
|
|
|
Loans |
$ |
6,164,058 |
|
|
$ |
56,939 |
|
3.66 |
% |
|
$ |
6,282,151 |
|
|
$ |
62,725 |
|
3.97 |
% |
Securities |
|
2,188,093 |
|
|
|
11,066 |
|
2.01 |
% |
|
|
1,546,657 |
|
|
|
8,940 |
|
2.30 |
% |
Other interest-earning assets |
|
322,636 |
|
|
|
574 |
|
0.71 |
% |
|
|
489,880 |
|
|
|
836 |
|
0.68 |
% |
Total interest-earning
assets |
|
8,674,787 |
|
|
|
68,579 |
|
3.14 |
% |
|
|
8,318,688 |
|
|
|
72,501 |
|
3.47 |
% |
Non-interest-earning
assets |
|
690,630 |
|
|
|
|
|
|
|
600,226 |
|
|
|
|
|
Total assets |
$ |
9,365,417 |
|
|
|
|
|
|
$ |
8,918,914 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing demand |
$ |
2,549,131 |
|
|
$ |
1,942 |
|
0.30 |
% |
|
$ |
2,142,190 |
|
|
$ |
2,373 |
|
0.44 |
% |
Money market accounts |
|
646,324 |
|
|
|
363 |
|
0.22 |
% |
|
|
613,871 |
|
|
|
603 |
|
0.39 |
% |
Savings and club deposits |
|
793,670 |
|
|
|
119 |
|
0.06 |
% |
|
|
670,737 |
|
|
|
269 |
|
0.16 |
% |
Certificates of deposit |
|
1,777,361 |
|
|
|
3,282 |
|
0.73 |
% |
|
|
2,004,074 |
|
|
|
7,432 |
|
1.48 |
% |
Total interest-bearing
deposits |
|
5,766,486 |
|
|
|
5,706 |
|
0.39 |
% |
|
|
5,430,872 |
|
|
|
10,677 |
|
0.78 |
% |
FHLB advances |
|
690,445 |
|
|
|
1,824 |
|
1.05 |
% |
|
|
942,644 |
|
|
|
3,082 |
|
1.30 |
% |
Notes payable |
|
2,933 |
|
|
|
25 |
|
3.38 |
% |
|
|
— |
|
|
|
— |
|
— |
% |
Junior subordinated debentures |
|
7,352 |
|
|
|
62 |
|
3.35 |
% |
|
|
8,369 |
|
|
|
66 |
|
3.14 |
% |
Total borrowings |
|
700,730 |
|
|
|
1,911 |
|
1.08 |
% |
|
|
951,013 |
|
|
|
3,148 |
|
1.32 |
% |
Total interest-bearing
liabilities |
|
6,467,216 |
|
|
$ |
7,617 |
|
0.47 |
% |
|
|
6,381,885 |
|
|
$ |
13,825 |
|
0.86 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest-bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
Non-interest-bearing deposits |
|
1,646,975 |
|
|
|
|
|
|
|
1,326,030 |
|
|
|
|
|
Other non-interest-bearing liabilities |
|
198,765 |
|
|
|
|
|
|
|
207,409 |
|
|
|
|
|
Total liabilities |
|
8,312,956 |
|
|
|
|
|
|
|
7,915,324 |
|
|
|
|
|
Total stockholders'
equity |
|
1,052,462 |
|
|
|
|
|
|
|
1,003,590 |
|
|
|
|
|
Total liabilities and
stockholders' equity |
$ |
9,365,418 |
|
|
|
|
|
|
$ |
8,918,914 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
|
$ |
60,962 |
|
|
|
|
|
$ |
58,676 |
|
|
Interest rate spread |
|
|
|
|
2.67 |
% |
|
|
|
|
|
2.61 |
% |
Net interest-earning
assets |
$ |
2,207,571 |
|
|
|
|
|
|
$ |
1,936,803 |
|
|
|
|
|
Net interest margin |
|
|
|
|
2.79 |
% |
|
|
|
|
|
2.81 |
% |
Ratio of interest-earning
assets to interest-bearing liabilities |
|
134.13 |
% |
|
|
|
|
|
|
130.35 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COLUMBIA FINANCIAL, INC. AND
SUBSIDIARIESAverage Balances/Yields
|
For the Years Ended December 31, |
|
2021 |
|
2020 |
|
Average Balance |
|
Interest and Dividends |
|
Yield / Cost |
|
Average Balance |
|
Interest and Dividends |
|
Yield / Cost |
|
(Dollars in thousands) |
Interest-earnings assets: |
|
|
|
|
|
|
|
|
|
|
|
Loans |
$ |
6,139,290 |
|
|
$ |
228,841 |
|
3.73 |
% |
|
$ |
6,413,559 |
|
|
$ |
255,236 |
|
3.98 |
% |
Securities |
|
1,965,901 |
|
|
|
38,843 |
|
1.98 |
% |
|
|
1,465,093 |
|
|
|
36,401 |
|
2.48 |
% |
Other interest-earning assets |
|
350,162 |
|
|
|
2,466 |
|
0.70 |
% |
|
|
255,369 |
|
|
|
4,074 |
|
1.60 |
% |
Total interest-earning
assets |
|
8,455,353 |
|
|
$ |
270,150 |
|
3.20 |
% |
|
|
8,134,021 |
|
|
$ |
295,711 |
|
3.64 |
% |
Non-interest-earning
assets |
|
647,650 |
|
|
|
|
|
|
|
610,952 |
|
|
|
|
|
Total assets |
$ |
9,103,003 |
|
|
|
|
|
|
$ |
8,744,973 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing demand |
$ |
2,395,493 |
|
|
$ |
8,177 |
|
0.34 |
% |
|
$ |
1,945,075 |
|
|
$ |
12,666 |
|
0.65 |
% |
Money market accounts |
|
632,011 |
|
|
|
1,900 |
|
0.30 |
% |
|
|
510,189 |
|
|
|
2,890 |
|
0.57 |
% |
Savings and club deposits |
|
752,983 |
|
|
|
731 |
|
0.10 |
% |
|
|
623,964 |
|
|
|
1,023 |
|
0.16 |
% |
Certificates of deposit |
|
1,835,866 |
|
|
|
18,301 |
|
1.00 |
% |
|
|
2,088,488 |
|
|
|
38,667 |
|
1.85 |
% |
Total interest-bearing
deposits |
|
5,616,353 |
|
|
|
29,109 |
|
0.52 |
% |
|
|
5,167,716 |
|
|
|
55,246 |
|
1.07 |
% |
FHLB advances |
|
724,790 |
|
|
|
7,637 |
|
1.05 |
% |
|
|
1,122,633 |
|
|
|
18,145 |
|
1.62 |
% |
Notes payable |
|
740 |
|
|
|
25 |
|
3.38 |
% |
|
|
— |
|
|
|
— |
|
— |
% |
Junior subordinated debentures |
|
7,448 |
|
|
|
245 |
|
3.29 |
% |
|
|
8,481 |
|
|
|
295 |
|
3.48 |
% |
Other borrowings |
|
— |
|
|
|
— |
|
— |
% |
|
|
1,913 |
|
|
|
4 |
|
0.21 |
% |
Total borrowings |
|
732,978 |
|
|
|
7,907 |
|
1.08 |
% |
|
|
1,144,094 |
|
|
|
18,892 |
|
1.65 |
% |
Total interest-bearing
liabilities |
|
6,349,331 |
|
|
$ |
37,016 |
|
0.58 |
% |
|
|
6,311,810 |
|
|
$ |
74,138 |
|
1.17 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest-bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
Non-interest-bearing deposits |
|
1,522,322 |
|
|
|
|
|
|
|
1,215,352 |
|
|
|
|
|
Other non-interest-bearing liabilities |
|
206,436 |
|
|
|
|
|
|
|
201,714 |
|
|
|
|
|
Total liabilities |
|
8,078,089 |
|
|
|
|
|
|
|
7,728,876 |
|
|
|
|
|
Total stockholders'
equity |
|
1,024,914 |
|
|
|
|
|
|
|
1,016,097 |
|
|
|
|
|
Total liabilities and
stockholders' equity |
$ |
9,103,003 |
|
|
|
|
|
|
$ |
8,744,973 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
|
$ |
233,134 |
|
|
|
|
|
$ |
221,573 |
|
|
Interest rate spread |
|
|
|
|
2.62 |
% |
|
|
|
|
|
2.47 |
% |
Net interest-earning
assets |
$ |
2,106,022 |
|
|
|
|
|
|
$ |
1,822,211 |
|
|
|
|
|
Net interest margin |
|
|
|
|
2.76 |
% |
|
|
|
|
|
2.72 |
% |
Ratio of interest-earning
assets to interest-bearing liabilities |
|
133.17 |
% |
|
|
|
|
|
|
128.87 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COLUMBIA FINANCIAL, INC. AND
SUBSIDIARIESComponents of Net Interest Rate Spread
and Margin
|
Average Yields/Costs by Quarter |
|
December 31, 2021 |
|
September 30, 2021 |
|
June 30, 2021 |
|
March 31, 2021 |
|
December 31, 2020 |
Yield on
interest-earning assets: |
|
|
|
|
|
|
|
|
|
Loans |
3.66 |
% |
|
3.66 |
% |
|
3.72 |
% |
|
3.87 |
% |
|
3.97 |
% |
Securities |
2.01 |
|
|
1.93 |
|
|
1.93 |
|
|
2.05 |
|
|
2.30 |
|
Other interest-earning
assets |
0.71 |
|
|
0.54 |
|
|
1.24 |
|
|
0.67 |
|
|
0.68 |
|
Total interest-earning
assets |
3.14 |
% |
|
3.08 |
% |
|
3.24 |
% |
|
3.34 |
% |
|
3.47 |
% |
|
|
|
|
|
|
|
|
|
|
Cost of
interest-bearing liabilities: |
|
|
|
|
|
|
|
|
|
Total interest-bearing
deposits |
0.39 |
% |
|
0.47 |
% |
|
0.57 |
% |
|
0.66 |
% |
|
0.78 |
% |
Total borrowings |
1.08 |
|
|
1.07 |
|
|
1.07 |
|
|
1.09 |
|
|
1.32 |
|
Total interest-earning
liabilities |
0.47 |
% |
|
0.54 |
% |
|
0.62 |
% |
|
0.71 |
% |
|
0.86 |
% |
|
|
|
|
|
|
|
|
|
|
Interest rate spread |
2.67 |
% |
|
2.54 |
% |
|
2.62 |
% |
|
2.63 |
% |
|
2.61 |
% |
Net interest margin |
2.79 |
% |
|
2.67 |
% |
|
2.77 |
% |
|
2.80 |
% |
|
2.81 |
% |
|
|
|
|
|
|
|
|
|
|
Ratio of interest-earning
assets to interest-bearing liabilities |
134.13 |
% |
|
132.89 |
% |
|
133.53 |
% |
|
132.06 |
% |
|
130.35 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COLUMBIA FINANCIAL, INC. AND
SUBSIDIARIESSelected Financial
Highlights
|
|
|
|
|
|
|
|
|
Three MonthsEnded December
31, |
|
Years Ended December 31, |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
SELECTED FINANCIAL
RATIOS (1): |
|
|
|
|
|
|
|
Return on average assets |
0.99 |
% |
|
0.92 |
% |
|
1.01 |
% |
|
0.66 |
% |
Core return on average assets |
1.09 |
% |
|
0.97 |
% |
|
1.03 |
% |
|
0.72 |
% |
Return on average equity |
8.80 |
% |
|
8.19 |
% |
|
8.98 |
% |
|
5.67 |
% |
Core return on average equity |
9.68 |
% |
|
8.60 |
% |
|
9.16 |
% |
|
6.17 |
% |
Core return on average tangible equity |
10.57 |
% |
|
9.47 |
% |
|
10.01 |
% |
|
6.78 |
% |
Interest rate spread |
2.67 |
% |
|
2.61 |
% |
|
2.62 |
% |
|
2.47 |
% |
Net interest margin |
2.79 |
% |
|
2.81 |
% |
|
2.76 |
% |
|
2.72 |
% |
Non-interest income to average
assets |
0.30 |
% |
|
0.44 |
% |
|
0.43 |
% |
|
0.36 |
% |
Non-interest expense to
average assets |
1.84 |
% |
|
1.82 |
% |
|
1.71 |
% |
|
1.81 |
% |
Efficiency ratio |
63.85 |
% |
|
59.46 |
% |
|
57.26 |
% |
|
62.54 |
% |
Core efficiency ratio |
59.73 |
% |
|
57.42 |
% |
|
56.13 |
% |
|
59.65 |
% |
Average interest-earning
assets to average interest-bearing liabilities |
134.13 |
% |
|
130.35 |
% |
|
133.17 |
% |
|
128.87 |
% |
Net charge-offs to average
outstanding loans |
0.02 |
% |
|
0.13 |
% |
|
0.03 |
% |
|
0.09 |
% |
|
|
|
|
|
|
|
|
(1) Ratios
for the three months are annualized when appropriate. |
|
|
|
|
|
|
|
CAPITAL
RATIOS: |
|
|
|
|
December 31, |
|
2021 (1) |
|
2020 |
Company: |
|
|
|
Total capital (to risk-weighted assets) |
17.13 |
% |
|
18.54 |
% |
Tier 1 capital (to
risk-weighted assets) |
16.15 |
% |
|
17.29 |
% |
Common equity tier 1 capital
(to risk-weighted assets) |
16.04 |
% |
|
17.17 |
% |
Tier 1 capital (to adjusted
total assets) |
11.23 |
% |
|
11.38 |
% |
|
|
|
|
Columbia
Bank: |
|
|
|
Total capital (to
risk-weighted assets) |
15.39 |
% |
|
16.05 |
% |
Tier 1 capital (to
risk-weighted assets) |
14.38 |
% |
|
14.80 |
% |
Common equity tier 1 capital
(to risk-weighted assets) |
14.38 |
% |
|
14.80 |
% |
Tier 1 capital (to adjusted
total assets) |
9.80 |
% |
|
9.72 |
% |
|
|
|
|
Freehold
Bank: |
|
|
|
Total capital (to
risk-weighted assets) |
22.87 |
% |
|
N/A |
Tier 1 capital (to
risk-weighted assets) |
22.86 |
% |
|
N/A |
Common equity tier 1 capital
(to risk-weighted assets) |
22.86 |
% |
|
N/A |
Tier 1 capital (to adjusted
total assets) |
13.71 |
% |
|
N/A |
|
|
|
|
(1) Estimated
ratios at December 31, 2021. |
|
|
|
ASSET
QUALITY: |
|
|
|
|
December 31, |
|
2021 |
|
2020 |
|
(Dollars in thousands) |
Non-accrual loans |
$ |
3,939 |
|
|
$ |
8,156 |
|
90+ and still accruing |
|
— |
|
|
|
— |
|
Non-performing loans |
|
3,939 |
|
|
|
8,156 |
|
Real estate owned |
|
— |
|
|
|
— |
|
Total non-performing assets |
$ |
3,939 |
|
|
$ |
8,156 |
|
|
|
|
|
Non-performing loans to total
gross loans |
|
0.06 |
% |
|
|
0.13 |
% |
Non-performing assets to total
assets |
|
0.04 |
% |
|
|
0.09 |
% |
Allowance for loan losses |
$ |
62,689 |
|
|
$ |
74,676 |
|
Allowance for loan losses to
total non-performing loans |
|
1,591.50 |
% |
|
|
915.60 |
% |
Allowance for loan losses to
gross loans |
|
0.99 |
% |
|
|
1.21 |
% |
Allowance for loan losses to
gross loans, excluding SBA PPP loans |
|
1.00 |
% |
|
|
1.28 |
% |
Unamortized purchase
accounting fair value credit marks on acquired loans |
$ |
5,019 |
|
|
$ |
6,486 |
|
LOAN
DATA: |
|
|
|
|
December 31, |
|
2021 |
|
2020 |
Real estate loans: |
(In thousands) |
One-to-four family |
$ |
2,092,317 |
|
|
$ |
1,940,327 |
|
Multifamily and commercial |
|
3,211,344 |
|
|
|
2,817,965 |
|
Construction |
|
295,047 |
|
|
|
328,711 |
|
Commercial business loans
* |
|
452,232 |
|
|
|
752,870 |
|
Consumer loans: |
|
|
|
Home equity loans and advances |
|
276,563 |
|
|
|
321,177 |
|
Other consumer loans |
|
1,428 |
|
|
|
1,497 |
|
Total gross loans |
|
6,328,931 |
|
|
|
6,162,547 |
|
Purchased credit-impaired
("PCI") loans |
|
6,791 |
|
|
|
6,345 |
|
Net deferred loan costs, fees
and purchased premiums and discounts ** |
|
24,879 |
|
|
|
12,878 |
|
Allowance for loan losses |
|
(62,689 |
) |
|
|
(74,676 |
) |
Loans receivable, net |
$ |
6,297,912 |
|
|
$ |
6,107,094 |
|
|
|
|
|
* At December 31, 2021 and 2020 includes SBA PPP loans totaling
$45.0 million and $344.4 million, respectively. |
** At December 31, 2021 and 2020 includes SBA PPP net deferred loan
fees totaling $1.2 million and $6.6 million, respectively. |
Reconciliation of GAAP to Non-GAAP Financial
Measures |
|
|
|
|
Book and
Tangible Book Value per Share |
|
December 31, |
|
2021 |
|
2020 |
|
|
|
|
Total stockholders' equity |
$ |
1,079,081 |
|
|
$ |
1,011,287 |
|
Less: goodwill |
|
(85,324 |
) |
|
|
(80,285 |
) |
Less: core deposit
intangible |
|
(5,214 |
) |
|
|
(6,197 |
) |
Total tangible stockholders'
equity |
$ |
988,543 |
|
|
$ |
924,805 |
|
|
|
|
|
Shares outstanding |
|
107,442,453 |
|
|
|
110,939,753 |
|
|
|
|
|
Book value per share |
$ |
10.04 |
|
|
$ |
9.12 |
|
Tangible book value per
share |
$ |
9.20 |
|
|
$ |
8.34 |
|
Reconciliation of Core Net Income |
|
Three Months Ended December 31, |
|
Years Ended December 31, |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
(In thousands) |
Net income |
$ |
23,334 |
|
|
$ |
20,654 |
|
|
$ |
92,049 |
|
|
$ |
57,603 |
|
Less: gain on securities
transactions, net of tax |
|
(7 |
) |
|
|
— |
|
|
|
(1,481 |
) |
|
|
(279 |
) |
Less/Add: voluntary early
retirement plan (credit) expenses, net of tax (benefit) |
|
— |
|
|
|
(18 |
) |
|
|
— |
|
|
|
2,255 |
|
Add: merger-related expenses,
net of tax |
|
879 |
|
|
|
— |
|
|
|
974 |
|
|
|
1,500 |
|
Add: loss on extinguishment of
debt, net of tax |
|
1,539 |
|
|
|
879 |
|
|
|
2,079 |
|
|
|
879 |
|
Add: branch closure expense,
net of tax |
|
— |
|
|
|
197 |
|
|
|
410 |
|
|
|
1,075 |
|
Core net income |
$ |
25,745 |
|
|
$ |
21,712 |
|
|
$ |
94,031 |
|
|
$ |
63,033 |
|
Return on
Average Assets |
|
Three Months Ended December 31, |
|
Years Ended December 31, |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
(Dollars in thousands) |
Net income |
$ |
23,334 |
|
|
$ |
20,654 |
|
|
$ |
92,049 |
|
|
$ |
57,603 |
|
|
|
|
|
|
|
|
|
Average assets |
$ |
9,365,417 |
|
|
$ |
8,918,914 |
|
|
$ |
9,103,003 |
|
|
$ |
8,744,973 |
|
|
|
|
|
|
|
|
|
Return on average assets |
|
0.99 |
% |
|
|
0.92 |
% |
|
|
1.01 |
% |
|
|
0.66 |
% |
|
|
|
|
|
|
|
|
Core net income |
$ |
25,745 |
|
|
$ |
21,712 |
|
|
$ |
94,031 |
|
|
$ |
63,033 |
|
|
|
|
|
|
|
|
|
Core return on average
assets |
|
1.09 |
% |
|
|
0.97 |
% |
|
|
1.03 |
% |
|
|
0.72 |
% |
Reconciliation of GAAP to Non-GAAP Financial Measures
(continued) |
|
|
|
|
|
|
|
|
|
|
Return on
Average Equity |
|
Three Months Ended December 31, |
|
Years Ended December 31, |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
(Dollars in thousands) |
Total average stockholders' equity |
$ |
1,052,462 |
|
|
$ |
1,003,590 |
|
|
$ |
1,024,914 |
|
|
$ |
1,016,097 |
|
Less: gain on securities
transactions, net of tax |
|
(7 |
) |
|
|
— |
|
|
|
(1,481 |
) |
|
|
(279 |
) |
Less/Add: voluntary early
retirement plan (credit) expenses, net of tax (benefit) |
|
— |
|
|
|
(18 |
) |
|
|
— |
|
|
|
2,255 |
|
Add: merger-related expenses,
net of tax |
|
879 |
|
|
|
— |
|
|
|
974 |
|
|
|
1,500 |
|
Add: loss on extinguishment of
debt, net of tax |
|
1,539 |
|
|
|
879 |
|
|
|
2,079 |
|
|
|
879 |
|
Add: branch closure expenses,
net of tax |
|
— |
|
|
|
197 |
|
|
|
410 |
|
|
|
1,075 |
|
Core average stockholders'
equity |
$ |
1,054,873 |
|
|
$ |
1,004,648 |
|
|
$ |
1,026,896 |
|
|
$ |
1,021,527 |
|
|
|
|
|
|
|
|
|
Return on average equity |
|
8.80 |
% |
|
|
8.19 |
% |
|
|
8.98 |
% |
|
|
5.67 |
% |
|
|
|
|
|
|
|
|
Core return on core average
equity |
|
9.68 |
% |
|
|
8.60 |
% |
|
|
9.16 |
% |
|
|
6.17 |
% |
Return on
Average Tangible Equity |
|
Three Months Ended December 31, |
|
Years Ended December 31, |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
(Dollars in thousands) |
Total average stockholders' equity |
$ |
1,052,462 |
|
|
$ |
1,003,590 |
|
|
$ |
1,024,914 |
|
|
$ |
1,016,097 |
|
Less: average goodwill |
|
(81,018 |
) |
|
|
(85,370 |
) |
|
|
(79,842 |
) |
|
|
(79,593 |
) |
Less: average core deposit
intangible |
|
(5,346 |
) |
|
|
(6,367 |
) |
|
|
(5,717 |
) |
|
|
(6,769 |
) |
Total average tangible
stockholders' equity |
$ |
966,098 |
|
|
$ |
911,853 |
|
|
$ |
939,355 |
|
|
$ |
929,735 |
|
|
|
|
|
|
|
|
|
Core return on average
tangible equity |
|
10.57 |
% |
|
|
9.47 |
% |
|
|
10.01 |
% |
|
|
6.78 |
% |
Reconciliation of GAAP to Non-GAAP Financial Measures
(continued) |
|
|
|
|
|
|
|
|
|
|
Efficiency Ratios |
|
Three Months Ended December 31, |
|
Years Ended December 31, |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
(Dollars in thousands) |
Net interest income |
$ |
60,962 |
|
|
$ |
58,676 |
|
|
$ |
233,134 |
|
|
$ |
221,573 |
|
Non-interest income |
|
6,971 |
|
|
|
9,962 |
|
|
|
38,831 |
|
|
|
31,270 |
|
Total income |
$ |
67,933 |
|
|
$ |
68,638 |
|
|
$ |
271,965 |
|
|
$ |
252,843 |
|
|
|
|
|
|
|
|
|
Non-interest expense |
$ |
43,372 |
|
|
$ |
40,810 |
|
|
$ |
155,737 |
|
|
$ |
158,139 |
|
|
|
|
|
|
|
|
|
Efficiency ratio |
|
63.85 |
% |
|
|
59.46 |
% |
|
|
57.26 |
% |
|
|
62.54 |
% |
|
|
|
|
|
|
|
|
Non-interest income |
$ |
6,971 |
|
|
$ |
9,962 |
|
|
$ |
38,831 |
|
|
$ |
31,270 |
|
Less: gain on securities
transactions |
|
(10 |
) |
|
|
— |
|
|
|
(2,025 |
) |
|
|
(370 |
) |
Core non-interest income |
$ |
6,961 |
|
|
$ |
9,962 |
|
|
$ |
36,806 |
|
|
$ |
30,900 |
|
|
|
|
|
|
|
|
|
Non-interest expense |
$ |
43,372 |
|
|
$ |
40,810 |
|
|
$ |
155,737 |
|
|
$ |
158,139 |
|
Add/Less: voluntary early
retirement plan credit/ expenses |
|
— |
|
|
|
24 |
|
|
|
— |
|
|
|
(3,018 |
) |
Less: merger-related
expenses |
|
(692 |
) |
|
|
— |
|
|
$ |
(822 |
) |
|
|
(1,931 |
) |
Less: loss on extinguishment
of debt |
|
(2,109 |
) |
|
|
(1,158 |
) |
|
|
(2,851 |
) |
|
|
(1,158 |
) |
Less: branch closure
expense |
|
— |
|
|
|
(264 |
) |
|
|
(548 |
) |
|
|
(1,434 |
) |
Core non-interest expense |
$ |
40,571 |
|
|
$ |
39,412 |
|
|
$ |
151,516 |
|
|
$ |
150,598 |
|
|
|
|
|
|
|
|
|
Core efficiency ratio |
|
59.73 |
% |
|
|
57.42 |
% |
|
|
56.13 |
% |
|
|
59.65 |
% |
Contact: |
|
Tony Rose |
|
|
1st Senior Vice
President/Marketing Director |
|
|
201-794-5828 |
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