Columbia Financial, Inc. Announces Financial Results for the First Quarter Ended March 31, 2021

4/28, 10:05 PM (Source: GlobeNewswire)

FAIR LAWN, N.J., April 28, 2021 (GLOBE NEWSWIRE) -- Columbia Financial, Inc. (the “Company”) (NASDAQ: CLBK), the mid-tier holding company for Columbia Bank (the "Bank"), reported net income of $21.0 million, or $0.20 per basic and diluted share, for the quarter ended March 31, 2021, as compared to net income of $6.8 million, or $0.06 per basic and diluted share, for the quarter ended March 31, 2020. Earnings for the quarter ended March 31, 2021 reflected higher net interest income, a reversal of provision for loan losses, higher non-interest income and lower non-interest expense, partially offset by higher income tax expense.

Mr. Thomas J. Kemly, President and Chief Executive Officer commented: "We are pleased with our results as we increased revenue and managed expense levels during the first quarter. Our net income increased $14.3 million over our first quarter one year ago, as we successfully reduced our cost of funds and increased shareholder value through the continuation of our stock repurchase program. Asset quality remains strong despite continuing challenges posed by the COVID-19 pandemic. We will strive to build on these positive trends throughout the year."

Results of Operations for the Quarters Ended March 31, 2021 and March 31, 2020

Net income of $21.0 million was recorded for the quarter ended March 31, 2021, an increase of $14.3 million, or 211.1%, compared to net income of $6.8 million for the quarter ended March 31, 2020. The increase in net income was primarily attributable to a $6.0 million increase in net interest income, a $10.8 million decrease in provision for loan losses, a $2.2 million increase in non-interest income and an $805,000 decrease in non-interest expense, partially offset by a $5.6 million increase in income tax expense.

Net interest income was $56.7 million for the quarter ended March 31, 2021, an increase of $6.0 million, or 11.9%, from $50.7 million for the quarter ended March 31, 2020. The increase in net interest income was primarily attributable to a $13.1 million decrease in interest expense, partially offset by a $7.1 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 a significantly reduced rate 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 quarter ended March 31, 2021, $56.5 million of Federal Home Loan Bank of New York ("FHLB") borrowings were prepaid, resulting in a $742,000 loss on early extinguishment of debt included in non-interest expense. The Company has significantly reduced the cost of borrowings over the last two quarters by prepaying high rate borrowings. The decrease in interest income for the quarter ended March 31, 2021 was largely due to decreases in the average yields on interest-earning assets. Deferred fee acceleration of $2.1 million was recognized upon forgiveness of $109.1 million in SBA Paycheck Protection Program ("PPP") loans for the quarter ended March 31, 2021. Prepayment penalties, which are included in interest income on loans, totaled $968,000 for the quarter ended March 31, 2021, compared to $722,000 for the quarter ended March 31, 2020.

The average yield on loans for the quarter ended March 31, 2021 decreased 28 basis points to 3.87%, as compared to 4.15% for the quarter ended March 31, 2020, while the average yield on securities for the quarter ended March 31, 2021 decreased 67 basis points to 2.05%, as compared to 2.72% for the quarter ended March 31, 2020. The average yield on other interest-earning assets for the quarter ended March 31, 2021 decreased 439 basis points to 0.67%, as compared to 5.06% for the quarter ended March 31, 2020, as there were substantially higher cash balances in low yielding bank accounts for the quarter ended March 31, 2021. Decreases in the average yields on these portfolios for the quarter ended March 31, 2021 were influenced by the lower interest rate environment as the Federal Reserve reduced interest rates by 150 basis points in March 2020 in response to the COVID-19 pandemic.

Total interest expense was $10.9 million for the quarter ended March 31, 2021, a decrease of $13.1 million, or 54.6%, from $24.0 million for the quarter ended March 31, 2020. The decrease in interest expense was primarily attributable to a 77 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 $5.1 million due to a decrease in the average balances of FHLB advances and subordinated notes, coupled with a 98 basis point decrease in the cost of total borrowings. During the quarter ended March 31, 2021, we prepaid $53.5 million of FHLB borrowings with an average rate of 2.64% and original contractual maturities through March 2022, and a $3.0 million FHLB borrowing acquired in our acquisition of Roselle Bank with a rate of 2.74% and an original contractual maturity of March 2024. The prepayments were funded by excess cash liquidity. The transactions were accounted for as early debt extinguishments resulting in a total loss of $742,000.

The Company's net interest margin for the quarter ended March 31, 2021 increased 15 basis points to 2.80%, when compared to 2.65% for the quarter ended March 31, 2020. The weighted average yield on interest-earning assets decreased 57 basis points to 3.34% for the quarter ended March 31, 2021 as compared to 3.91% for the quarter ended March 31, 2020. Excluding the impact of PPP loan deferred fee acceleration for the quarter ended March 31, 2021, the net interest margin would have been 2.69%. The average cost of interest-bearing liabilities decreased 87 basis points to 0.71% for the quarter ended March 31, 2021 as compared to 1.58% for the quarter ended March 31, 2020. The decrease in yields and costs for the quarter ended March 31, 2021 were largely driven by a continued lower interest rate environment. The net interest margin increased for the quarter ended March 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 quarter ended March 31, 2021 was $1.3 million, a decrease of $10.8 million, from $9.6 million of provision for loan loss expense recorded for the quarter ended March 31, 2020. The comparatively lower level of provision for the 2021 period was primarily attributable to a decrease in the average balance of loans, 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 $8.6 million for the quarter ended March 31, 2021, an increase of $2.2 million, or 34.5%, from $6.4 million for the quarter ended March 31, 2020. The increase was primarily attributable to an increase in income from the gain on the sale of loans of $1.4 million and an increase in other non-interest income of $1.3 million, partially offset by a decrease in demand deposit account fees of $461,000. The increase in other non-interest income is primarily attributable to higher consumer check card income and interest rate swap fair value adjustments.

Non-interest expense was $37.7 million for the quarter ended March 31, 2021, a decrease of $805,000, or 2.1%, from $38.5 million for the quarter ended March 31, 2020. The decrease was primarily attributable to a decrease in compensation and employee benefits expense of $1.1 million, and a decrease in merger-related expenses of $1.1 million, partially offset by an increase in data processing and software expenses of $541,000 and a loss on the extinguishment of debt of $742,000. The decrease in compensation and employee benefits was primarily attributable to an increase in amounts deferred as direct loan origination costs as a result of an increase in originations. Merger-related expenses recorded in the 2020 period related to the acquisitions of Stewardship Financial Corporation and Roselle Bank. 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 quarter ended March 31, 2021, the Company utilized excess liquidity to prepay long-term borrowings which resulted in a $742,000 loss on the early extinguishment of debt.

Income tax expense was $7.9 million for the quarter ended March 31, 2021, an increase of $5.6 million, as compared to $2.3 million for the quarter ended March 31, 2020, mainly due to an increase in pre-tax income, and to a lesser extent, an increase in the effective tax rate. The Company's effective tax rate was 27.2% and 25.0% for the quarters ended March 31, 2021 and 2020, respectively.

Balance Sheet Summary

Total assets increased $241.4 million, or 2.7%, to $9.0 billion at March 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 $157.3 million, debt securities held to maturity of $128.5 million, and loans receivable, net, of $45.9 million, partially offset by decreases of $63.2 million in cash and cash equivalents and $19.3 million in other assets.

Cash and cash equivalents decreased $63.2 million, or 15.0%, to $359.7 million at March 31, 2021 from $423.0 million at December 31, 2020. The decrease was primarily attributable to $351.5 million in purchases of debt securities available for sale and held to maturity, $32.8 million in repurchases of common stock under our stock repurchase program, and $56.5 million in prepayments of borrowings, partially offset by an increase in repayments on loans, repayments on mortgage-backed securities, and growth in deposits.

Debt securities available for sale increased $157.3 million, or 11.9%, to $1.5 billion at March 31, 2021 from $1.3 billion at December 31, 2020. The increase was attributable to purchases of $208.6 million of securities primarily consisting of U.S. government and agency obligations and mortgage-backed securities, and $64.0 million in purchases of guarantor swaps with Freddie Mac, partially offset by maturities and calls of $5.2 million in corporate debt and municipal securities, and repayments of $89.1 million. The gross unrealized gain (loss) on debt securities available for sale decreased by $19.8 million during the quarter ended March 31, 2021.

Debt securities held to maturity increased $128.5 million, or 48.9%, to $391.3 million at March 31, 2021 from $262.7 million at December 31, 2020. The increase was primarily attributable to purchases of $142.9 million of securities primarily consisting of U.S. agency obligations and mortgage-backed securities, partially offset by the call of a $5.0 million U.S. agency obligation and repayments of $9.1 million.

Loans receivable, net, increased $45.9 million, or 0.8%, to $6.2 billion at March 31, 2021 from $6.1 billion at December 31, 2020. Commercial business loans, multi-family and commercial real estate loans, and construction loans increased $72.6 million, $55.6 million, and $9.3 million, respectively, partially offset by decreases in one-to-four family real estate loans and home equity loans and advances of $63.2 million, and $26.9 million, respectively. The increase in commercial business loans for the quarter ended March 31, 2021, was mainly due to the origination of $217.5 million in loans granted as part of the SBA PPP. The allowance for loan loss balance decreased $2.8 million to $71.9 million at March 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 expects to adopt CECL on January 1, 2022.

Other assets decreased $19.3 million, or 9.2%, to $190.5 million at March 31, 2021 from $209.9 million at December 31, 2020. The decrease in other assets consisted of a $14.3 million decrease in the collateral balance related to our swap agreement obligations, and a decrease of $6.8 million in federal and state income tax receivables.

Total liabilities increased $253.0 million, or 3.2%, to $8.0 billion at March 31, 2021 from $7.8 billion at December 31, 2020. The increase was primarily attributable to an increase in total deposits of $217.7 million, or 3.2%, and an increase in accrued expenses and other liabilities of $111.5 million, or 63.1%, partially offset by a decrease in borrowings of $76.7 million, or 9.6%. The increase in total deposits consisted of increases in non-interest-bearing and interest-bearing demand deposits of $134.9 million and $87.3 million, respectively, and money market accounts and savings and club deposits of $32.9 million and $44.3 million, respectively, partially offset by a decrease in certificates of deposit accounts of $81.7 million. The increase in accrued expenses and other liabilities consisted of a $130.0 million liability related to unsettled securities trades, and a $15.5 million decrease in interest rate swap liabilities. The decrease in borrowings was primarily driven by the prepayment of $56.5 million of FHLB borrowings and a net decrease in short-term borrowings of $23.0 million.

Total stockholders’ equity decreased $11.6 million, or 1.2%, to $999.6 million at March 31, 2021 from $1.0 billion at December 31, 2020. The decrease was primarily attributable to the repurchase of 1,998,539 shares of common stock totaling $32.8 million under our stock repurchase program, partially offset by net income of $21.0 million.

Asset Quality

The Company's non-performing loans at March 31, 2021 totaled $6.2 million, or 0.10% of total gross loans, as compared to $8.2 million, or 0.13% of total gross loans, at December 31, 2020. The $2.0 million decrease in non-performing loans was primarily attributable to decreases of $539,000 in non-performing one-to-four family real estate loans, $1.0 million in non-performing commercial business loans, and $275,000 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 11 non-performing loans at March 31, 2021. The decrease in non-performing commercial business loans was mainly due to charge-offs totaling $1.1 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 eight non-performing loans at March 31, 2021. Non-performing assets as a percentage of total assets totaled 0.07% at March 31, 2021 as compared to 0.09% at December 31, 2020.

For the quarter ended March 31, 2021, net charge-offs totaled $1.5 million as compared to $77,000 for the quarter ended March 31, 2020. The increase in net charge-offs for the quarter ended March 31, 2021, was primarily due to a $956,000 charge-off of one commercial business loan and charge-offs totaling $206,000 for three one-to-four family real estate loans.

The Company's allowance for loan losses was $71.9 million, or 1.16% of total loans, at March 31, 2021, compared to $74.7 million, or 1.21% of total 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.

COVID-19

Through March 31, 2021, the Company granted commercial loan modification requests with respect to multifamily, commercial, and construction real estate loans with current balances of $726.8 million and consumer-related loan modification requests with respect to one-to-four family real estate loans and home equity loans and advances with current balances of $164.7 million to our customers affected by the COVID-19 pandemic. These short-term loan modifications will be treated in accordance with Section 4013 of the CARES Act and will not be 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, including provisions permitting loan deferral extension requests to not be treated as troubled debt restructurings. Furthermore, these loans will continue to accrue interest and will not be tested for impairment during the short-term modification period. Commercial loan modification requests include various industries and property types. The following table is a summary of loan modifications that have not begun to remit full payment:

 Balance at
December 31, 2020
 Percent of
Total Loans at
December 31, 2020
  Balance at
March 31, 2021
 Percent of
Total Loans at
March 31, 2021
 Balance at
April 22, 2021
 Percent of
Total Loans at
April 22, 2021
  
 (Dollars in thousands)
Real estate loans:           
One-to-four family$6,770  0.35% $7,168  0.38% $5,660  0.30%
Multifamily and commercial71,348  2.53  64,746  2.25  57,464  1.96 
Construction3,312  1.01  3,337  0.99  3,337  1.12 
Commercial business loans3,397  0.45  3,073  0.37  2,792  0.34 
Home equity loans and advances314  0.10  626  0.21     
Total loans$85,141  1.38% $78,950  1.27% $69,253  1.11%

At March 31, 2021, $37.7 million of the commercial loans in the above table are remitting partial payments and $70.7 million were granted an additional deferral period.

About Columbia Financial, Inc.

The consolidated financial results include the accounts of Columbia Financial, Inc. its wholly-owned subsidiary Columbia Bank (the "Bank") and the Bank's 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. The Bank offers traditional financial services to consumers and businesses in our market areas. We currently operate 61 full-services banking offices.

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 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 as filed with the Securities and Exchange Commission (the “SEC”), which is 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 SUBSIDIARIES
Consolidated Statements of Financial Condition
(In thousands)

 March 31, December 31,
 2021 2020
Assets(Unaudited)  
Cash and due from banks$359,532  $422,787 
Short-term investments184  170 
Total cash and cash equivalents359,716  422,957 
    
Debt securities available for sale, at fair value1,474,246  1,316,952 
Debt securities held to maturity, at amortized cost (fair value of $398,906, and $277,091 at March 31, 2021 and December 31, 2020, respectively)391,264  262,720 
Equity securities, at fair value4,830  5,418 
Federal Home Loan Bank stock40,280  43,759 
Loans held-for-sale, at fair value  4,146 
    
Loans receivable6,224,865  6,181,770 
Less: allowance for loan losses71,904  74,676 
Loans receivable, net6,152,961  6,107,094 
    
Accrued interest receivable28,670  29,456 
Office properties and equipment, net76,790  75,974 
Bank-owned life insurance234,294  232,824 
Goodwill and intangible assets86,331  87,384 
Other assets190,549  209,852 
Total assets$9,039,931  $8,798,536 
    
Liabilities and Stockholders' Equity   
Liabilities:   
Deposits$6,996,330  $6,778,624 
Borrowings722,615  799,364 
Advance payments by borrowers for taxes and insurance33,102  32,570 
Accrued expenses and other liabilities288,235  176,691 
Total liabilities8,040,282  7,787,249 
    
Stockholders' equity:   
Total stockholders' equity999,649  1,011,287 
Total liabilities and stockholders' equity$9,039,931  $8,798,536 


COLUMBIA FINANCIAL, INC. AND SUBSIDIARIES
Consolidated Statements of Income
(In thousands, except share and per share data)

 Three Months Ended
March 31,
 2021 2020
  
Interest income:(Unaudited)
Loans receivable$58,768  $64,018 
Debt securities available for sale and equity securities6,378  7,328 
Debt securities held to maturity1,752  2,065 
Federal funds and interest-earning deposits104  189 
Federal Home Loan Bank stock dividends635  1,090 
Total interest income67,637  74,690 
Interest expense:   
Deposits8,875  16,832 
Borrowings2,022  7,156 
Total interest expense10,897  23,988 
    
Net interest income56,740  50,702 
    
(Reversal of) provision for loan losses(1,280) 9,568 
    
Net interest income after (reversal of) provision for loan losses58,020  41,134 
    
Non-interest income:   
Demand deposit account fees838  1,299 
Bank-owned life insurance1,474  1,417 
Title insurance fees1,620  1,231 
Loan fees and service charges651  728 
Gain on securities transactions  370 
Change in fair value of equity securities(588) (584)
Gain on sale of loans2,150  754 
Other non-interest income2,450  1,176 
Total non-interest income8,595  6,391 
    
Non-interest expense:   
Compensation and employee benefits23,393  24,465 
Occupancy5,252  4,795 
Federal deposit insurance premiums580  110 
Advertising535  1,144 
Professional fees1,790  1,366 
Data processing and software expenses2,771  2,230 
Merger-related expenses  1,075 
Loss on extinguishment of debt742   
Other non-interest expense2,640  3,323 
Total non-interest expense37,703  38,508 
    
Income before income tax expense28,912  9,017 
    
Income tax expense7,867  2,252 
    
Net income$21,045  $6,765 
    
Earnings per share-basic and diluted$0.20  $0.06 
Weighted average shares outstanding-basic and diluted105,977,621  108,438,173 

 


COLUMBIA FINANCIAL, INC. AND SUBSIDIARIES
Average Balances/Yields

  Three Months Ended March 31,
 2021 2020
 Average
Balance
 Interest
and
Dividends
 Yield / Cost Average
Balance
 Interest
and
Dividends
 Yield / Cost
  
 (Dollars in thousands)
Interest-earnings assets:           
Loans$6,161,405  $58,768  3.87% $6,198,459  $64,018  4.15%
Securities1,611,607  8,130  2.05% 1,386,858  9,393  2.72%
Other interest-earning assets449,578  739  0.67% 101,694  1,279  5.06%
Total interest-earning assets8,222,590  67,637  3.34% 7,687,011  74,690  3.91%
Non-interest-earning assets624,746      564,182     
Total assets$8,847,336      $8,251,193     
            
Interest-bearing liabilities:           
Interest-bearing demand$2,253,879  $2,140  0.39% $1,755,889  $4,671  1.07%
Money market accounts592,994  518  0.35% 419,231  1,071  1.03%
Savings and club deposits707,655  194  0.11% 543,618  215  0.16%
Certificates of deposit1,920,924  6,023  1.27% 2,015,982  10,875  2.17%
Total interest-bearing deposits5,475,452  8,875  0.66% 4,734,720  16,832  1.43%
FHLB advances743,290  1,961  1.07% 1,366,265  6,889  2.03%
Subordinated notes    % 17,132  169  3.97%
Junior subordinated debentures7,582  61  3.26% 7,448  98  5.29%
Total borrowings750,872  2,022  1.09% 1,390,845  7,156  2.07%
Total interest-bearing liabilities6,226,324  $10,897  0.71% 6,125,565  $23,988  1.58%
            
Non-interest-bearing liabilities:           
Non-interest-bearing deposits1,407,974      959,942     
Other non-interest-bearing liabilities208,520      185,780     
Total liabilities7,842,818      7,271,287     
Total stockholders' equity1,004,518      979,906     
Total liabilities and stockholders' equity$8,847,336      $8,251,193     
            
Net interest income  $56,740      $50,702   
Interest rate spread    2.63%     2.33%
Net interest-earning assets$1,996,266      $1,561,446     
Net interest margin    2.80%     2.65%
Ratio of interest-earning assets to interest-bearing liabilities132.06%     125.49%    


COLUMBIA FINANCIAL, INC. AND SUBSIDIARIES
Components of Net Interest Rate Spread and Margin

 Average Yields/Costs by Quarter
 March 31,
2021
 December 31,
2020
 September 30,
2020
 June 30,
2020
 March 31,
2020
Yield on interest-earning assets:         
Loans3.87% 3.97% 3.85% 3.96% 4.15%
Securities2.05  2.30  2.38  2.56  2.72 
Other interest-earning assets0.67  0.68  1.26  2.95  5.06 
Total interest-earning assets3.34% 3.47% 3.50% 3.69% 3.91%
          
Cost of interest-bearing liabilities:         
Total interest-bearing deposits0.66% 0.78% 0.96% 1.15% 1.43%
Total borrowings1.09  1.32  1.41  1.66  2.07 
Total interest-bearing liabilities0.71% 0.86% 1.04% 1.25% 1.58%
          
Interest rate spread2.63% 2.61% 2.46% 2.44% 2.33%
Net interest margin2.80% 2.81% 2.70% 2.73% 2.65%
          
Ratio of interest-earning assets to interest-bearing liabilities132.06% 130.35% 130.13% 129.35% 125.49%

 


COLUMBIA FINANCIAL, INC. AND SUBSIDIARIES
Selected Financial Highlights

    
  Three Months Ended March 31,
 2021 2020
SELECTED FINANCIAL RATIOS (1):   
Return on average assets0.96% 0.33%
Core return on average assets0.99% 0.40%
Return on average equity8.50% 2.78%
Core return on average equity8.71% 3.35%
Core return on average tangible equity9.53% 3.61%
Interest rate spread2.63% 2.33%
Net interest margin2.80% 2.65%
Non-interest income to average assets0.39% 0.31%
Non-interest expense to average assets1.73% 1.88%
Efficiency ratio57.71% 67.45%
Core efficiency ratio56.57% 63.93%
Average interest-earning assets to average interest-bearing liabilities132.06% 125.49%
Net charge-offs to average outstanding loans0.10% 0.01%
    
(1) Ratios for the three months are annualized when appropriate.   


CAPITAL RATIOS:   
 March 31, December 31,
 2021 2020
Company:   
Total capital (to risk-weighted assets)18.27% 18.54%
Tier 1 capital (to risk-weighted assets)17.02% 17.29%
Common equity tier 1 capital (to risk-weighted assets)16.90% 17.17%
Tier 1 capital (to adjusted total assets)11.37% 11.38%
    
Bank:   
Total capital (to risk-weighted assets)16.34% 16.05%
Tier 1 capital (to risk-weighted assets)15.10% 14.80%
Common equity tier 1 capital (to risk-weighted assets)15.10% 14.80%
Tier 1 capital (to adjusted total assets)10.08% 9.72%


ASSET QUALITY:   
 March 31, December 31,
 2021 2020
  
 (Dollars in thousands)
Non-accrual loans$6,154  $8,156 
90+ and still accruing   
Non-performing loans6,154  8,156 
Real estate owned   
Total non-performing assets$6,154  $8,156 
    
Non-performing loans to total gross loans0.10% 0.13%
Non-performing assets to total assets0.07% 0.09%
Allowance for loan losses$71,904  $74,676 
Allowance for loan losses to total non-performing loans1,168.41% 915.60%
Allowance for loan losses to gross loans1.16% 1.21%
Allowance for loan losses to gross loans, excluding SBA PPP loans1.25% 1.28%
Unamortized purchase accounting fair value credit marks on acquired loans$5,886  $6,486 


LOAN DATA:   
 March 31, December 31,
 2021 2020
  
Real estate loans:(In thousands)
One-to-four family$1,877,131  $1,940,327 
Multifamily and commercial2,873,586  2,817,965 
Construction338,001  328,711 
Commercial business loans *825,469  752,870 
Consumer loans:   
Home equity loans and advances294,230  321,177 
Other consumer loans1,181  1,497 
Total gross loans6,209,598  6,162,547 
Purchased credit-impaired ("PCI") loans6,230  6,345 
Net deferred loan costs, fees and purchased premiums and discounts **9,037  12,878 
Allowance for loan losses(71,904) (74,676)
Loans receivable, net$6,152,961  $6,107,094 
    
* At March 31, 2021and December 31, 2020 includes SBA PPP loans totaling $446.2 million and $344.4 million, respectively.
** At March 31, 2021 and December 31, 2020 includes SBA PPP net deferred loan fees totaling $11.3 million and $6.6 million, respectively.


Reconciliation of GAAP to Non-GAAP Financial Measures
    
Book and Tangible Book Value per Share
 March 31, December 31,
 2021 2020
    
Total stockholders' equity$999,649  $1,011,287 
Less: goodwill(79,220) (80,285)
Less: core deposit intangible(5,935) (6,197)
Total tangible stockholders' equity$914,494  $924,805 
    
Shares outstanding108,977,571  110,939,753 
    
Book value per share$9.17  $9.12 
Tangible book value per share$8.39  $8.34 


Return on Average Tangible Equity
 March 31, March 31,
 2021 2020
    
Total Average stockholders' equity$1,004,518  $979,906 
Less: goodwill(79,906) (60,763)
Less: core deposit intangible(6,102) (7,174)
Total Average tangible stockholders' equity$918,510  $911,969 
    
Core return on average tangible equity9.53% 3.61%


Reconciliation of Core Net Income   
 Three Months Ended March 31,
 2021 2020
  
 (In thousands)
    
Net income$21,045  $6,765 
Less: gain on securities transactions, net of tax  (278)
Add: loss on extinguishment of debt, net of tax540   
Add: branch closure expense, net of tax  878 
Core net income$21,585  $8,183 


Reconciliation of GAAP to Non-GAAP Financial Measures (continued)

Return on Average Assets   
 Three Months Ended March 31,
 2021 2020
  
 (Dollars in thousands)
    
Net income$21,045  $6,765 
    
Average assets$8,847,336  $8,251,193 
    
Return on average assets0.96% 0.33%
    
Core net income$21,585  $8,183 
    
Core return on average assets0.99% 0.40%


Return on Average Equity   
 Three Months Ended March 31,
 2021 2020
  
 (Dollars in thousands)
    
Total average stockholders' equity$1,004,518  $979,906 
Less: gain on securities transactions, net of tax  (278)
Add: merger-related expenses, net of tax  818 
Add: loss on extinguishment of debt, net of tax540   
Add: branch closure expense, net of tax  878 
Core average stockholders' equity$1,005,058  $981,324 
    
Return on average equity8.50% 2.78%
    
Core return on core average equity8.71% 3.35%


Return on Average Tangible Equity
 March 31, March 31,
 2021 2020
    
Total average stockholders' equity$1,004,518  $979,906 
Less: average goodwill(79,906) (60,763)
Less: average core deposit intangible(6,102) (7,174)
Total average tangible stockholders' equity$918,510  $911,969 
    
Core return on average tangible equity9.53% 3.61%


Reconciliation of GAAP to Non-GAAP Financial Measures (continued)

Efficiency Ratios   
 Three Months Ended March 31,
 2021 2020
  
 (Dollars in thousands)
    
Net interest income$56,740  $50,702 
Non-interest income8,595  6,391 
Total income$65,335  $57,093 
    
Non-interest expense$37,703  $38,508 
    
Efficiency ratio57.71% 67.45%
    
Non-interest income$8,595  $6,391 
Less: gain on securities transactions  (370)
Core non-interest income$8,595  $6,021 
    
Non-interest expense$37,703  $38,508 
Less: merger-related expenses  (1,075)
Less: loss on extinguishment of debt(742)  
Less: branch closure expense  (1,170)
Core non-interest expense$36,961  $36,263 
    
Core efficiency ratio56.57% 63.93%


Contact:Tony Rose
 1st Senior Vice President/Marketing Director
 201-794-5828

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