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What changed in FLUSHING FINANCIAL CORP's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of FLUSHING FINANCIAL CORP's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+390 added−372 removedSource: 10-K (2025-03-11) vs 10-K (2024-03-15)

Top changes in FLUSHING FINANCIAL CORP's 2024 10-K

390 paragraphs added · 372 removed · 298 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

162 edited+35 added−19 removed264 unchanged
Biggest changeThese amounts were not included in our interest income for the respective periods. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, (Dollars in thousands) 2023 2022 2021 2020 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Loans 90 days or more past due and still accruing: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Multi-family residential ​ $ 1,463 ​ $ — ​ $ — ​ $ 201 ​ $ 445 ​ Commercial real estate ​ — ​ — ​ — ​ 2,547 ​ — ​ Construction ​ ​ — ​ ​ 2,600 ​ ​ — ​ ​ — ​ ​ — ​ Total ​ 1,463 ​ 2,600 ​ — ​ 2,748 ​ 445 ​ Non-accrual mortgage loans: ​ ​ ​ ​ ​ ​ Multi-family residential ​ 3,206 ​ 3,206 ​ 2,431 ​ 2,524 ​ 2,296 ​ Commercial real estate ​ — ​ 237 ​ 613 ​ 1,683 ​ 367 ​ One-to-four family mixed-use property (1) ​ 981 ​ 790 ​ 1,309 ​ 1,366 ​ 274 ​ One-to-four family residential ​ 5,181 ​ 4,425 ​ 7,725 ​ 5,854 ​ 5,139 ​ Total ​ 9,368 ​ 8,658 ​ 12,078 ​ 11,427 ​ 8,076 ​ Non-accrual commercial business loans: ​ ​ ​ ​ ​ ​ Small Business Administration ​ 2,552 ​ 937 ​ 937 ​ 1,151 ​ 1,151 ​ Taxi medallion (1) ​ — ​ — ​ — ​ 2,317 ​ 1,641 ​ Commercial business and other (1) ​ 11,789 ​ 20,187 ​ 1,918 ​ 3,430 ​ 1,945 ​ Total ​ 14,341 ​ 21,124 ​ 2,855 ​ 6,898 ​ 4,737 ​ Total non-accrual loans ​ 23,709 ​ 29,782 ​ 14,933 ​ 18,325 ​ 12,813 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total non-performing loans ​ 25,172 ​ 32,382 ​ 14,933 ​ 21,073 ​ 13,258 ​ Other non-performing assets: ​ ​ ​ ​ ​ ​ Other Real Estate Owned ​ — ​ — ​ — ​ — ​ 239 ​ Held-to-maturity securities ​ ​ 20,981 ​ ​ 20,981 ​ ​ — ​ ​ — ​ ​ — ​ Other assets acquired through foreclosure ​ — ​ — ​ — ​ 35 ​ 35 ​ Total ​ 20,981 ​ 20,981 ​ — ​ 35 ​ 274 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total non-performing assets ​ $ 46,153 ​ $ 53,363 ​ $ 14,933 ​ $ 21,108 ​ $ 13,532 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Non-performing loans to gross loans ​ 0.36 % 0.47 % 0.23 % 0.31 % 0.23 % Non-performing assets to total assets ​ 0.54 % 0.63 % 0.19 % 0.26 % 0.19 % (1) Not included in the above analysis are the following non-accrual TDRs, under legacy GAAP, that are performing according to their restructured terms: taxi medallion loans totaling $0.4 million and $1.7 million at December 31, 2020, and 2019, respectively, One-to-four family mixed-use property loans totaling $0.2 million and $0.3 million at December 31, 2022 and 2021, respectively, and commercial business loans totaling less than $0.1 million at December 31, 2022, and 2021, and $2.2 million and $0.9 million at December 31, 2020, and 2019, respectively. 16 Table of Contents The following table shows our delinquent loans that are less than 90 days past due and still accruing interest at the periods indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2023 ​ December 31, 2022 ​ ​ 30 - 59 ​ 60 - 89 ​ 30 - 59 ​ 60 - 89 ​ days days days days ​ ​ (In thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Multi-family residential ​ $ 2,722 ​ $ 539 ​ $ 1,475 ​ $ 1,787 Commercial real estate ​ 8,090 ​ 1,099 ​ 2,561 ​ — One-to-four family ― mixed-use property ​ 1,708 ​ 124 ​ 3,721 ​ — One-to-four family ― residential ​ 1,715 ​ — ​ 2,734 ​ — Small Business Administration ​ — ​ — ​ 329 ​ — Commercial business and other ​ 420 ​ 1,061 ​ 7,636 ​ 16 Total ​ $ 14,655 ​ $ 2,823 ​ $ 18,456 ​ $ 1,803 ​ Other Real Estate Owned.
Biggest changeThese amounts were not included in our interest income for the respective periods. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, (Dollars in thousands) 2024 2023 2022 2021 2020 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Loans 90 days or more past due and still accruing: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Multi-family residential ​ $ — ​ $ 1,463 ​ $ — ​ $ — ​ $ 201 ​ Commercial real estate ​ — ​ — ​ — ​ — ​ 2,547 ​ Construction ​ ​ — ​ ​ — ​ ​ 2,600 ​ ​ — ​ ​ — ​ Total ​ — ​ 1,463 ​ 2,600 ​ — ​ 2,748 ​ Non-accrual mortgage loans: ​ ​ ​ ​ ​ ​ Multi-family residential ​ 11,031 ​ 3,206 ​ 3,206 ​ 2,431 ​ 2,524 ​ Commercial real estate ​ 6,283 ​ — ​ 237 ​ 613 ​ 1,683 ​ One-to-four family mixed-use property (1) ​ 116 ​ 981 ​ 790 ​ 1,309 ​ 1,366 ​ One-to-four family residential ​ 1,428 ​ 5,181 ​ 4,425 ​ 7,725 ​ 5,854 ​ Total ​ 18,858 ​ 9,368 ​ 8,658 ​ 12,078 ​ 11,427 ​ Non-accrual commercial business loans: ​ ​ ​ ​ ​ ​ Small Business Administration ​ 2,445 ​ 2,552 ​ 937 ​ 937 ​ 1,151 ​ Taxi medallion (1) ​ — ​ — ​ — ​ — ​ 2,317 ​ Commercial business and other (1) ​ 12,015 ​ 11,789 ​ 20,187 ​ 1,918 ​ 3,430 ​ Total ​ 14,460 ​ 14,341 ​ 21,124 ​ 2,855 ​ 6,898 ​ Total non-accrual loans ​ 33,318 ​ 23,709 ​ 29,782 ​ 14,933 ​ 18,325 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total non-performing loans ​ 33,318 ​ 25,172 ​ 32,382 ​ 14,933 ​ 21,073 ​ Other non-performing assets: ​ ​ ​ ​ ​ ​ Available for sale securities (2) ​ 18,000 ​ — ​ — ​ — ​ — ​ Held-to-maturity securities (2) ​ ​ — ​ ​ 20,981 ​ ​ 20,981 ​ ​ — ​ ​ — ​ Other assets acquired through foreclosure ​ — ​ — ​ — ​ — ​ 35 ​ Total ​ 18,000 ​ 20,981 ​ 20,981 ​ — ​ 35 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total non-performing assets ​ $ 51,318 ​ $ 46,153 ​ $ 53,363 ​ $ 14,933 ​ $ 21,108 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Non-performing loans to gross loans ​ 0.49 % 0.36 % 0.47 % 0.23 % 0.31 % Non-performing assets to total assets ​ 0.57 % 0.54 % 0.63 % 0.19 % 0.26 % (1) Not included in the above analysis are the following non-accrual TDRs, under legacy GAAP, that are performing according to their restructured terms: taxi medallion loans totaling $0.4 million at December 31, 2020, one-to-four family mixed-use property loans totaling $0.2 million and $0.3 million at December 31, 2022 and 2021, respectively, and commercial business loans totaling less than $0.1 million at December 31, 2022, and 2021, and $2.2 million at December 31, 2020. ​ (2) During the year ended December 31, 2024, one held-to-maturity municipal security with an amortized cost of $20.6 million was transferred to available for sale.
Interest rates on ARM loans currently offered by us are adjusted at the beginning of each adjustment period based upon a fixed spread above the FHLB-NY corresponding Regular Advance Rate.
Interest rates on ARM loans currently offered by us are adjusted at the beginning of each adjustment period based upon a fixed spread above the FHLB-NY corresponding Regular Advance Rate.
From time to time, we may originate ARM loans at an initial rate lower than the index as a result of a discount on the spread for the initial adjustment period.
From time to time, we may originate ARM loans at an initial rate lower than the index as a result of a discount on the spread for the initial adjustment period.
Interest rates on ARM loans currently offered by us are adjusted at the beginning of each adjustment period based upon a fixed spread above the FHLB-NY corresponding Regular Advance Rate.
Interest rates on ARM loans currently offered by us are adjusted at the beginning of each adjustment period based upon a fixed spread above the FHLB-NY corresponding Regular Advance Rate.
From time to time, we may originate ARM loans at an initial rate lower than the index as a result of a discount on the spread for the initial adjustment period.
From time to time, we may originate ARM loans at an initial rate lower than the index as a result of a discount on the spread for the initial adjustment period.
We typically require debt service coverage of at least 125% of the monthly loan payment. The weighted average debt service coverage ratio for this portfolio is approximately 180% based on the most recent annual loan review. We generally originate these loans up to only 75% of the appraised value or the purchase price of the property, whichever is less.
We typically require debt service coverage of at least 125% of the monthly loan payment. The weighted average debt service coverage for this portfolio is approximately 180% based on the most recent annual loan review. We generally originate these loans up to only 75% of the appraised value or the purchase price of the property, whichever is less.
We have focused our loan origination efforts on multi-family residential mortgage loans, commercial real estate and commercial business loans with full banking relationships. All of these loan types generally include prepayment penalties that we collect if the loans pay in full prior to the contractual maturity.
We have focused our loan origination efforts on multi-family residential mortgage loans, commercial real estate and commercial business loans with full banking relationships. All these loan types generally include prepayment penalties that we collect if the loans pay in full prior to the contractual maturity.
In underwriting commercial real estate mortgage loans, we employ the same underwriting standards and procedures as are employed in underwriting multi-family residential mortgage loans. The weighted average debt service coverage ratio for this portfolio is approximately 180% based on the most recent annual loan review.
In underwriting commercial real estate mortgage loans, we employ the same underwriting standards and procedures as are employed in underwriting multi-family residential mortgage loans. The weighted average debt service coverage for this portfolio is approximately 180% based on the most recent annual loan review.
Particularly intense competition also exists in all of the lending activities we emphasize. ​ In addition to the financial institutions mentioned above, we compete against mortgage banks and insurance companies located both within our market and available on the internet.
Particularly intense competition also exists in all the lending activities we emphasize. ​ In addition to the financial institutions mentioned above, we compete against mortgage banks and insurance companies located both within our market and available on the internet.
Unlike non-brokered certificates of deposit, where the deposit amount can be withdrawn with a penalty for any reason, including increasing interest rates, a brokered certificate of deposit can only be withdrawn in the event of the death, or court declared mental incompetence, of the depositor.
Unlike non-brokered certificates of deposit, where the deposit amount can be withdrawn with a penalty for any reason, including increasing interest rates, a brokered certificates of deposit can only be withdrawn in the event of the death, or court declared mental incompetence, of the depositor.
Loan operations are also subject to federal laws applicable to credit transactions, such as: ● The federal Truth-In-Lending Act and Regulation Z issued by the FRB, governing disclosures of credit terms to consumer borrowers; ● The Home Mortgage Disclosure Act and Regulation C issued by the FRB, requiring financial institutions to provide information to enable the public and public officials to determine whether a financial institution is fulfilling its obligation to help meet the housing needs of the community it serves; ● The Equal Credit Opportunity Act and Regulation B issued by the FRB, prohibiting discrimination on the basis of race, creed or other prohibited factors in extending credit; ● The Fair Credit Reporting Act and Regulation V issued by the FRB, governing the use and provision of information to consumer reporting agencies; ● The Fair Debt Collection Act, governing the manner in which consumer debts may be collected by collection agencies; and ● The guidance of the various federal agencies charged with the responsibility of implementing such federal laws.
Loan operations are also subject to federal laws applicable to credit transactions, such as: ● The federal Truth-In-Lending Act and Regulation Z issued by the FRB, governing disclosures of credit terms to consumer borrowers; ● The Home Mortgage Disclosure Act and Regulation C issued by the FRB, requiring financial institutions to provide information to enable the public and public officials to determine whether a financial institution is fulfilling its obligation to help meet the housing needs of the community it serves; 42 Table of Contents ● The Equal Credit Opportunity Act and Regulation B issued by the FRB, prohibiting discrimination on the basis of race, creed or other prohibited factors in extending credit; ● The Fair Credit Reporting Act and Regulation V issued by the FRB, governing the use and provision of information to consumer reporting agencies; ● The Fair Debt Collection Act, governing the manner in which consumer debts may be collected by collection agencies; and ● The guidance of the various federal agencies charged with the responsibility of implementing such federal laws.
As of December 31, 2023, the Company’s consolidated capital exceeded these requirements. 40 Table of Contents Bank holding companies are generally required to give the FRB prior written notice of any purchase or redemption of its outstanding equity securities if the gross consideration for the purchase or redemption, when combined with the net consideration paid for all such purchases or redemptions during the preceding twelve months, is equal to 10% or more of the Company’s consolidated net worth.
As of December 31, 2024, the Company’s consolidated capital exceeded these requirements. 40 Table of Contents Bank holding companies are generally required to give the FRB prior written notice of any purchase or redemption of its outstanding equity securities if the gross consideration for the purchase or redemption, when combined with the net consideration paid for all such purchases or redemptions during the preceding twelve months, is equal to 10% or more of the Company’s consolidated net worth.
On mortgage loans and commercial business loan participations purchased by us for whom the seller retains the servicing rights, we receive monthly reports with which we monitor the loan portfolio.
For mortgage loans and commercial business loan participations purchased by us for whom the seller retains the servicing rights, we receive monthly reports with which we monitor the loan portfolio.
When such modifications are performed, a change to the allowance for credit losses is generally not required as the methodologies used to estimate the allowance already capture the effect of borrowers experiencing financial difficulty. On December 31, 2023, there were no commitments to lend additional funds to borrowers who have received a loan modification as a result of financial difficulty.
When such modifications are performed, a change to the allowance for credit losses is generally not required as the methodologies used to estimate the allowance already capture the effect of borrowers experiencing financial difficulty. On December 31, 2024, there were no commitments to lend additional funds to borrowers who have received a loan modification as a result of financial difficulty.
Although we have authority to invest in various types of assets, we primarily invest in mortgage-backed securities, securities issued by mutual or bond funds that invest in government and government agency securities, municipal bonds, corporate bonds and collateralized loan obligations (“CLO”). We did not hold any issues of foreign sovereign debt on either December 31, 2023, and 2022.
Although we have authority to invest in various types of assets, we primarily invest in mortgage-backed securities, securities issued by mutual or bond funds that invest in government and government agency securities, municipal bonds, corporate bonds and collateralized loan obligations (“CLO”). We did not hold any issues of foreign sovereign debt on either December 31, 2024, and 2023.
Our market area has a high density of financial institutions, many of which have greater financial resources, name recognition and market presence than we do, and all of which are competitors to varying degrees. Particularly intense competition exists for deposits, as we compete with 108 banks and thrifts in the counties in which we have branch locations.
Our market area has a high density of financial institutions, many of which have greater financial resources, name recognition and market presence than we do, and all of which are competitors to varying degrees. Particularly intense competition exists for deposits, as we compete with 107 banks and thrifts in the counties in which we have branch locations.
These junior subordinated debentures are carried at fair value in the Consolidated Statement of Financial Condition. At December 31, 2023, the Company holds subordinated debt with an aggregated principal balance of $190.0 million. ​ The Company uses interest rate swaps on borrowings to help mitigate the impact interest rate increases have on our cost of funds.
These junior subordinated debentures are carried at fair value in the Consolidated Statement of Financial Condition. At December 31, 2024, the Company holds subordinated debt with an aggregated principal balance of $190.0 million. ​ The Company uses interest rate swaps on borrowings to help mitigate the impact interest rate increases have on our cost of funds.
For borrowers who are experiencing financial difficulties, we have restructured certain problem loans by: reducing the interest rate until the next reset date, extending the amortization period thereby lowering the monthly payments, deferring a portion of the interest payment, principal forgiveness and/or changing the loan to interest only payments for a limited time period.
For borrowers who are experiencing financial difficulties, we had restructured certain problem loans by: reducing the interest rate until the next reset date, extending the amortization period thereby lowering the monthly payments, deferring a portion of the interest payment, principal forgiveness and/or changing the loan to interest only payments for a limited time period.
Deposit operations also are subject to: 42 Table of Contents ● The Truth in Savings Act and Regulation DD issued by the FRB, which requires disclosure of deposit terms to consumers; ● Regulation CC issued by the FRB, which relates to the availability of deposit funds to consumers; ● The Right to Financial Privacy Act, which imposes a duty to maintain the confidentiality of consumer financial records and prescribes procedures for complying with administrative subpoenas of financial records; and ● The Electronic Funds Transfer Act and Regulation E issued by the FRB, which governs automatic deposits to and withdrawals from deposit accounts and customers’ rights and liabilities arising from the use of automated teller machines and other electronic banking services.
Deposit operations also are subject to: ● The Truth in Savings Act and Regulation DD issued by the FRB, which requires disclosure of deposit terms to consumers; ● Regulation CC issued by the FRB, which relates to the availability of deposit funds to consumers; ● The Right to Financial Privacy Act, which imposes a duty to maintain the confidentiality of consumer financial records and prescribes procedures for complying with administrative subpoenas of financial records; and ● The Electronic Funds Transfer Act and Regulation E issued by the FRB, which governs automatic deposits to and withdrawals from deposit accounts and customers’ rights and liabilities arising from the use of automated teller machines and other electronic banking services.
A bank may be deemed to be in a capitalization category that is lower than is indicated by its actual capital position if it received an unsatisfactory safety and soundness examination rating. As of December 31, 2023, the Bank was “well-capitalized”, as applicably defined.
A bank may be deemed to be in a capitalization category that is lower than is indicated by its actual capital position if it received an unsatisfactory safety and soundness examination rating. As of December 31, 2024, the Bank was “well-capitalized”, as applicably defined.
Mortgage loans are primarily multi-family, commercial and one-to-four family mixed-use properties, which represent 74.6% of gross loans. Our revenues are derived principally from interest on loans, our mortgage-backed securities portfolio, and interest and dividends on other investments in our securities portfolio.
Mortgage loans are primarily multi-family, commercial and one-to-four family mixed-use properties, which represent 74.4% of gross loans. Our revenues are derived principally from interest on loans, our mortgage-backed securities portfolio, and interest and dividends on other investments in our securities portfolio.
For purposes of the description contained in this section, one-to-four family residential mortgage loans, co-operative apartment loans and home equity loans are collectively referred to herein as “residential mortgage loans.” We offer both fixed-rate and adjustable-rate residential mortgage loans with maturities of up to 30 years and a general maximum loan amount of $1.0 million.
For purposes of the description contained in this section, one-to-four family residential mortgage loans, co-operative apartment loans and home equity loans are collectively referred to herein as “residential mortgage loans.” We offer both fixed-rate and adjustable-rate residential 8 Table of Contents mortgage loans with maturities of up to 30 years and a general maximum loan amount of $1.0 million.
In 2023, the FDIC issued a report setting forth safety and soundness standards and a computer-security incident notification rule under which a banking organization must notify its primary federal regulator of any significant 43 Table of Contents computer-security incident as soon as possible, but no later than 36 hours after determining that such an incident has occurred.
In 2023, the FDIC issued a report setting forth safety and soundness standards and a computer-security incident notification rule under which a banking organization must notify its primary federal regulator of any significant computer-security incident as soon as possible, but no later than 36 hours after determining that such an incident has occurred.
To the extent that an award under the 2014 Omnibus Plan is cancelled, expired, forfeited, settled in cash, settled by issuance of fewer shares than the number underlying the award, or otherwise terminated without delivery of shares to a participant in payment of the exercise price or taxes relating to an award, the shares retained by or returned to the Company will be available for future issuance under the 2014 Omnibus Plan.
To the extent that an award under the 2014 Omnibus Plan is cancelled, expired, forfeited, settled in cash, settled by issuance of fewer shares than the number underlying the award, or otherwise terminated without delivery of shares to a participant in payment of the exercise price or taxes relating to an award, the shares retained by or returned to the Company will be available for future issuance under the 2014 Omnibus 32 Table of Contents Plan.
Depositors are allowed to withdraw funds, with a penalty, from these accounts at one or more of the member banks that hold the deposits. Additionally, we place a portion of our government deposits in the IntraFi Network money market and demand accounts which does not require us to provide collateral.
Depositors are allowed to withdraw funds, with a 27 Table of Contents penalty, from these accounts at one or more of the member banks that hold the deposits. Additionally, we place a portion of our government deposits in the IntraFi Network money market and demand accounts which does not require us to provide collateral.
The lending powers of New York State-chartered commercial banks are not subject to percentage-of-assets or capital limitations, although there are limits applicable to loans to individual borrowers. The exercise by an FDIC-insured commercial bank of the lending and investment powers under New York State Banking Law is limited by FDIC regulations and other federal laws and regulations.
The lending powers of New York State-chartered commercial banks are not subject to percentage-of-assets or capital limitations, although there are limits applicable to loans to individual borrowers. 34 Table of Contents The exercise by an FDIC-insured commercial bank of the lending and investment powers under New York State Banking Law is limited by FDIC regulations and other federal laws and regulations.
We have not in the past, nor do we currently, originate ARM loans that provide for negative amortization. Most of our commercial business loans are generated by the Company’s business banking group which focuses on loan and deposit relationships to businesses located within our market area.
We have not in the past, nor do we currently, originate ARM loans that provide for negative amortization. 3 Table of Contents Most of our commercial business loans are generated by the Company’s business banking group which focuses on loan and deposit relationships to businesses located within our market area.
The Bank owned two subsidiaries during 2023: Flushing Service Corporation and FSB Properties Inc. The Bank also operates an internet branch (the “Internet Branch”), which operates under the brands of iGObanking.com® and BankPurely®.
The Bank owned two subsidiaries during 2024: Flushing Service Corporation and FSB Properties Inc. The Bank also operates an internet branch (the “Internet Branch”), which operates under the brands of iGObanking.com® and BankPurely®.
In particular, the applicable provisions of New York State Banking Law and regulations governing the investment authority and activities of an FDIC-insured 34 Table of Contents state-chartered savings bank and commercial bank have been effectively limited by the Federal Deposit Insurance Corporation Improvement Act of 1991 (“FDICIA”) and the FDIC regulations issued pursuant thereto.
In particular, the applicable provisions of New York State Banking Law and regulations governing the investment authority and activities of an FDIC-insured state-chartered savings bank and commercial bank have been effectively limited by the Federal Deposit Insurance Corporation Improvement Act of 1991 (“FDICIA”) and the FDIC regulations issued pursuant thereto.
However, we may not be aware of such uses or risks in any case, and, accordingly, there can be no assurance that real estate acquired by us in foreclosure is free from environmental contamination nor that we will not have any liability with respect thereto. Criticized and Classified Assets.
However, we may not be aware of such uses or risks in any case, and, accordingly, there can be no assurance that real estate acquired by us in foreclosure is free from environmental contamination nor that we will not have any liability with respect thereto.
The new rules require registrants to disclose on the new item 1.05 of Form 8-K any cybersecurity incident they determine to be material and to describe the material aspects of the incident’s nature, scope, and timing, as well as its material impact or reasonably likely impact on the registrant.
The new rules require registrants to disclose on the new item 1.05 of Form 8-K any cybersecurity incident they determine to be material and to describe the material aspects of the 43 Table of Contents incident’s nature, scope, and timing, as well as its material impact or reasonably likely impact on the registrant.
The weighted average loan to value ratio for this portfolio is approximately 42.7% based on the most recent appraisal and the loan balance at December 31, 2023. Our commercial real estate loans are primarily investor properties (non-owner occupied) which are generally considered to have higher credit risk than multi-family lending.
The weighted average loan to value ratio for this portfolio is approximately 42.1% based on the most recent appraisal and the loan balance at December 31, 2024. Our commercial real estate loans are primarily investor properties (non-owner occupied) which are generally considered to have higher credit risk than multi-family lending.
At December 31, 2023, there were no loans in excess of the maximum dollar amount of loans to one borrower that the Bank was authorized to make.
At December 31, 2024, there were no loans in excess of the maximum dollar amount of loans to one borrower that the Bank was authorized to make.
During the years ended December 31, 2023, 2022, and 2021, the amounts of additional interest income that would have been recorded on non-accrual loans, had they been current, totaled $2.0 million, $1.6 million, and $1.1 million, respectively.
During the years ended December 31, 2024, 2023, and 2022, the amounts of additional interest income that would have been recorded on non-accrual loans, had they been current, totaled $2.9 million, $2.0 million, and $1.6 million, respectively.
At times, certain problem loans have been restructured by combining more than one of these options. These restructurings have not included a reduction of principal balance. We believe that restructuring these loans in this manner will allow certain borrowers to become and remain current on their loans. These restructured loans are classified troubled debt restructured (“TDR”).
At times, certain problem loans had been restructured by combining more than one of these options. These restructurings have not included a reduction of principal balance. We believe that restructuring these loans in this manner allowed certain borrowers to become and remain current on their loans. These restructured loans are classified troubled debt restructured (“TDR”).
The Bank’s underwriting standards generally require a loan-to-value ratio of no more than 75% at the time the loan is originated. At December 31, 2023, the outstanding principal balance of our non-performing loans was 34.1% of the estimated current value of the supporting collateral, after considering the charge-offs that have been recorded.
The Bank’s underwriting standards generally require a loan-to-value ratio of no more than 75% at the time the loan is originated. At December 31, 2024, the outstanding principal balance of our non-performing loans was 43.1% of the estimated current value of the supporting collateral, after considering the charge-offs that have been recorded.
Loans which were delinquent at the 14 Table of Contents time they are restructured as a TDR are placed on non-accrual status until they have made timely payments for six consecutive months. ​ The following table shows loans classified as TDR under legacy GAAP at amortized cost that were performing according to their restructured terms at the periods indicated at December 31: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (In thousands) ​ 2022 ​ 2021 ​ 2020 ​ 2019 Accrual Status: ​ ​ ​ ​ ​ ​ ​ Multi-family residential ​ $ 1,673 ​ $ 1,690 ​ $ 1,700 ​ $ 1,873 Commercial real estate ​ 7,572 ​ 7,572 ​ 7,702 ​ — One-to-four family - mixed-use property ​ 974 ​ 1,375 ​ 1,459 ​ 1,481 One-to-four family - residential ​ 253 ​ 483 ​ 507 ​ 531 Commercial business and other ​ 1,069 ​ 1,340 ​ 1,588 ​ — Total ​ 11,541 ​ 12,460 ​ 12,956 ​ 3,885 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Non-Accrual Status: ​ ​ ​ ​ One-to-four family - mixed-use property ​ 248 ​ 261 ​ 272 ​ — Taxi Medallion ​ ​ — ​ ​ — ​ ​ 440 ​ ​ 1,668 Commercial business and other ​ 28 ​ 41 ​ 2,243 ​ 941 Total ​ 276 ​ 302 ​ 2,955 ​ 2,609 Total performing troubled debt restructured ​ $ 11,817 ​ $ 12,762 ​ $ 15,911 ​ $ 6,494 ​ Loans that are restructured as TDR but are not performing in accordance with the restructured terms are excluded from the TDR table above, as they are placed on non-accrual status and reported as non-performing loans.
Loans which were delinquent at the 14 Table of Contents time they are restructured as a TDR are placed on non-accrual status until they have made timely payments for six consecutive months. ​ The following table shows loans classified as TDR under legacy GAAP at amortized cost that were performing according to their restructured terms at the periods indicated at December 31: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, (In thousands) 2022 ​ 2021 ​ 2020 Accrual Status: ​ ​ ​ ​ ​ Multi-family residential ​ $ 1,673 ​ $ 1,690 ​ $ 1,700 Commercial real estate ​ 7,572 ​ 7,572 ​ 7,702 One-to-four family - mixed-use property ​ 974 ​ 1,375 ​ 1,459 One-to-four family - residential ​ 253 ​ 483 ​ 507 Commercial business and other ​ 1,069 ​ 1,340 ​ 1,588 Total ​ 11,541 ​ 12,460 ​ 12,956 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Non-Accrual Status: ​ ​ ​ One-to-four family - mixed-use property ​ 248 ​ 261 ​ 272 Taxi Medallion ​ ​ — ​ ​ — ​ ​ 440 Commercial business and other ​ 28 ​ 41 ​ 2,243 Total ​ 276 ​ 302 ​ 2,955 Total performing troubled debt restructured ​ $ 11,817 ​ $ 12,762 ​ $ 15,911 ​ Loans that were restructured as TDR but are not performing in accordance with the restructured terms are excluded from the TDR table above, as they are placed on non-accrual status and reported as non-performing loans.
You may obtain information about the operation of the public reference room by calling the SEC at 1 800 SEC 0330. You may request copies of these documents by writing to the SEC and paying a fee for the copying cost. ​
You may obtain information about the operation of the public reference room by calling the SEC at 1 800 SEC 0330. You may request copies of these documents by writing to the SEC and paying a fee for the copying cost. ​ ​ 44 Table of Contents
Our fixed-rate residential mortgage loans typically are originated for terms of 15 and 30 years and are competitively priced based on market conditions and our cost of funds. We originated and purchased $0.4 million, $3.3 million, and $0.8 million in fixed-rate residential mortgages in 2023, 2022, and 2021, respectively.
Our fixed-rate residential mortgage loans typically are originated for terms of 15 and 30 years and are competitively priced based on market conditions and our cost of funds. We originated and purchased $0.6 million, $0.4 million, and $3.3 million in fixed-rate residential mortgages in 2024, 2023, and 2022, respectively.
As a member of the FHLB-NY, the Bank is required to acquire and hold shares of FHLB-NY capital stock. Pursuant to this requirement, as of December 31, 2023, the Bank was required to maintain $31.1 million of FHLB-NY stock.
As a member of the FHLB-NY, the Bank is required to acquire and hold shares of FHLB-NY capital stock. Pursuant to this requirement, as of December 31, 2024, the Bank was required to maintain $38.1 million of FHLB-NY stock.
ARM loans generally are subject to limitations on interest rate increases of 2% per adjustment period and an aggregate adjustment of 6% over the life of the loan and have interest rate floors. We originated and purchased residential ARM loans totaling $6.5 million, $21.7 million, and $70.2 million during 2023, 2022, and 2021, respectively.
ARM loans generally are subject to limitations on interest rate increases of 2% per adjustment period and an aggregate adjustment of 6% over the life of the loan and have interest rate floors. We originated and purchased residential ARM loans totaling $55.1 million, $6.5 million, and $21.7 million during 2024, 2023, and 2022, respectively.
Multi-family adjustable-rate mortgage loans generally are not subject to limitations on interest rate increases either on an adjustment period or aggregate basis over the life of the loan; however, the loans generally contain interest rate floors. We originated and purchased multi-family ARM loans totaling $210.5 million, $392.0 million, and $188.7 million during 2023, 2022, and 2021, respectively.
Multi-family adjustable-rate mortgage loans generally are not subject to limitations on interest rate increases either on an adjustment period or aggregate basis over the life of the loan; however, the loans generally contain interest rate floors. We originated and purchased multi-family ARM loans totaling $106.6 million, $210.5 million, and $392.0 million during 2024, 2023, and 2022, respectively.
Generally, unsecured consumer loans are limited to amounts of $5,000 or less for terms of up to five years. We originated and purchased $4.7 million, $4.4 million, and $4.6 million of other loans during 2023, 2022, and 2021, respectively.
Generally, unsecured consumer loans are limited to amounts of $5,000 or less for terms of up to five years. We originated and purchased $7.2 million, $4.7 million, and $4.4 million of other loans during 2024, 2023, and 2022, respectively.
A portion of our brokered certificates of deposit are hedged against rising interest rates using interest rate swaps. At December 31, 2023 and December 31, 2022, $680.0 million and $200.0 million, respectively, were hedged using interest rate swaps. See Note 20 (“Derivative Financial Instruments”) of the Notes to the Consolidated Financial Statements .
A portion of our brokered certificates of deposit are hedged against rising interest rates using interest rate swaps. At December 31, 2024 and December 31, 2023, $875.8 million and $680.0 million, respectively, were hedged using interest rate swaps. See Note 20 (“Derivative Financial Instruments”) of the Notes to the Consolidated Financial Statements .
The activities of the Holding Company are primarily funded by dividends, if any, received from the Bank, issuances of subordinated debt and junior subordinated debt, and issuances of equity securities.
The activities of the Holding Company are primarily funded by cash on hand, dividends, if any, received from the Bank, issuances of subordinated debt and junior subordinated debt, and issuances of equity securities.
Our fixed-rate commercial business loans are generally originated for terms up to 20 years and are competitively priced based on market conditions and our cost of funds. We originated and purchased $322.4 million, $637.0 million, and $540.4 million of commercial business loans during 2023, 2022, and 2021, respectively.
Our fixed-rate commercial business loans are generally originated for terms up to 20 years and are competitively priced based on market conditions and our cost of funds. We originated and purchased $319.1 million, $322.4 million, and $637.0 million of commercial business loans during 2024, 2023, and 2022, respectively.
We utilize brokered deposits as an additional funding source, to assist in the management of our interest rate risk and as an underlying funding source for a portion of our interest rate swaps. At December 31, 2023 and 2022, we had $1,102.0 million and $856.3 million, respectively, classified as brokered deposits.
We utilize brokered deposits as an additional funding source, to assist in the management of our interest rate risk and as an underlying funding source for a portion of our interest rate swaps. At December 31, 2024 and 2023, we had $1,319.0 million and $1,102.0 million, respectively, classified as brokered deposits.
Our fixed-rate one-to-four family mixed-use property mortgage loans are originated for terms of up to 15 years and are competitively priced based on market conditions and the Bank’s cost of funds. We originated and purchased $11.4 million, $21.9 million, and $26.0 million of fixed-rate one-to-four family mixed-use property mortgage loans in 2023, 2022, and 2021, respectively.
Our fixed-rate one-to-four family mixed-use property mortgage loans are originated for terms of up to 15 years and are competitively priced based on market conditions and the Bank’s cost of funds. We originated and purchased $2.6 million, $11.4 million, and $21.9 million of fixed-rate one-to-four family mixed-use property mortgage loans in 2024, 2023, and 2022, respectively.
Securities are classified as held-to-maturity when management intends to hold the securities until maturity. We carry some of our investments under the fair value option totaling $13.4 million and $13.0 million at December 31, 2023, and 2022, respectively. Unrealized gains and losses for investments carried under the fair value option are included in our Consolidated Statements of Income.
Securities are classified as held-to-maturity when management intends to hold the securities until maturity. We carry some of our investments under the fair value option totaling $13.6 million and $13.4 million at December 31, 2024, and 2023, respectively. Unrealized gains and losses for investments carried under the fair value option are included in our Consolidated Statements of Operations.
It was available as an additional vehicle for access by the Company to the capital markets for future opportunities. Human Capital On December 31, 2023, we had 549 full-time employees and 15 part-time employees. None of our employees are represented by a collective bargaining unit, and we consider our relationship with our employees to be good.
It was available as an additional vehicle for access by the Company to the capital markets for future opportunities. Human Capital On December 31, 2024, we had 571 full-time employees and 17 part-time employees. None of our employees are represented by a collective bargaining unit, and we consider our relationship with our employees to be good.
Our policies provide that construction loans may be made in amounts up to 70% of the estimated value of the developed property and only if we obtain a first lien position on the underlying real estate. Construction loans are generally made with terms of two years or less.
We also, to a limited extent, finance the construction of commercial properties. Our policies provide that construction loans may be made in amounts up to 70% of the estimated value of the developed property and only if we obtain a first lien position on the underlying real estate. Construction loans are generally made with terms of two years or less.
The servicers are required to submit monthly reports on their collection efforts on delinquent loans. At December 31, 2023 and 2022, we held $364.0 million and $460.0 million, respectively, of loans that were serviced by others. Asset Quality Loan Collection .
The servicers are required to submit monthly reports on their collection efforts on delinquent loans. At December 31, 2024 and 2023, we held $266.1 million and $364.0 million, respectively, of loans that were serviced by others. Asset Quality Loan Collection .
At December 31, 2023 and 2022, total deposits in our government banking unit totaled $1,587.9 million and $1,653.3 million, respectively. Our core deposits, consisting of savings accounts, NOW accounts, money market accounts, and non-interest bearing demand accounts, are typically more stable and lower costing than other sources of funding.
At December 31, 2024 and 2023, total deposits in our government banking unit totaled $1,775.5 million and $1,587.9 million, respectively. Our core deposits, consisting of savings accounts, NOW accounts, money market accounts, and non-interest bearing demand accounts, are typically more stable and lower costing than other sources of funding.
Brokered deposits obtained by the Bank are generally fully FDIC insured. At December 31, 2023 and December 31, 2022, the Bank did not hold any uninsured brokered deposits. ​ The Depository Trust Company (“DTC”) is used as the clearing house, maintaining each deposit under the name of CEDE & Co.
Brokered deposits obtained by the Bank are generally fully FDIC insured and cannot be early redeemed. At December 31, 2024 and December 31, 2023, the Bank did not hold any uninsured brokered deposits. ​ The Depository Trust Company (“DTC”) is used as the clearing house, maintaining each deposit under the name of CEDE & Co.
The average loan to value ratio for this loan portfolio is approximately 30.6% based on the most recent appraisal and the loan balance at December 31, 2023. We generally rely on the income generated by the property as the primary means by which the loan is repaid. However, personal guarantees may be obtained for additional security from these borrowers.
The weighted average loan to value ratio for this loan portfolio is approximately 41.8% based on the most recent appraisal and the loan balance at December 31, 2024. We generally rely on the income generated by the property as the primary means by which the loan is repaid. However, personal guarantees may be obtained for additional security from these borrowers.
Included in deposits are certificates of deposit with balances of $250,000 or more (excluding brokered deposits issued in $1,000 amounts under a master certificate of deposit) was $497.4 million and $377.4 million at December 31, 2023 and 2022, respectively.
Included in deposits are certificates of deposit with balances of $250,000 or more (excluding brokered deposits issued in $1,000 amounts under a master certificates of deposit) was $514.4 million and $497.4 million at December 31, 2024 and 2023, respectively.
Our market share of deposits, as of June 30, 2023, in these counties was 0.35% of the total deposits of these FDIC insured competing financial institutions, and we are the 23rd largest financial institution. 1 In addition, we compete with credit unions, the stock market and mutual funds for customers’ funds.
Our market share of deposits, as of June 30, 2024, in these counties was 0.36% of the total deposits of these FDIC insured competing financial institutions, and we are the 24th largest financial institution. 1 In addition, we compete with credit unions, the stock market and mutual funds for customers’ funds.
Our fixed-rate commercial mortgage loans are generally originated for terms up to 20 years and are competitively priced based on market conditions and our cost of funds. We originated and purchased $12.2 million, $35.4 million, and $19.6 million of fixed-rate commercial mortgage loans in 2023, 2022, and 2021, respectively.
Our fixed-rate commercial mortgage loans are generally originated for terms up to 20 years and are competitively priced based on market conditions and our cost of funds. We originated and purchased $5.3 million, $12.2 million, and $35.4 million of fixed-rate commercial mortgage loans in 2024, 2023, and 2022, respectively.
Advances are made as construction progresses and inspection warrants, subject to continued title searches to ensure that we maintain a first lien position. We originated and purchased construction loans totaling $34.4 million, $31.6 million, and $38.1 million during 2023, 2022, and 2021, respectively.
Advances are made as construction progresses and inspection warrants, subject to continued title searches to ensure that we maintain a first lien position. We originated and purchased construction loans totaling $20.9 million, $34.4 million, and $31.6 million during 2024, 2023, and 2022, respectively.
A portion of our commercial business and other loans are commercial loans secured by owner-occupied real estate, which totaled $707.6 million, $732.0 million and $624.0 million at December 31, 2023, 2022 and 2021, respectively.
A portion of our commercial business and other loans are commercial loans secured by owner-occupied real estate, which totaled $745.1 million, $707.6 million and $732.0 million at December 31, 2024, 2023 and 2022, respectively.
See “Asset Quality — Environmental Concerns Relating to Loans.” 6 Table of Contents At December 31, 2023, $2,262.6 million, or 85.12%, of our multi-family mortgage loans consisted of ARM loans. We offer ARM loans with adjustment periods typically of five years and for terms of up to 30 years.
See “Asset Quality — Environmental Concerns Relating to Loans.” 6 Table of Contents At December 31, 2024, $2,166.5 million, or 85.73%, of our multi-family mortgage loans consisted of ARM loans. We offer ARM loans with adjustment periods typically of five years and for terms of up to 30 years.
We incurred total net charge-offs of $10.8 million, $1.5 million and $3.1 million during the years ended December 31, 2023, 2022 and 2021, respectively. The Company recorded a provision (benefit) for credit losses on loans totaling $10.5 million, $4.8 million and ($4.9) million for the years ended December 31, 2023, 2022 and 2021, respectively.
We incurred total net charge-offs of $7.7 million, $10.8 million and $1.5 million during the years ended December 31, 2024, 2023 and 2022, respectively. The Company recorded a provision for credit losses on loans totaling $7.7 million, $10.5 million and $4.8 million for the years ended December 31, 2024, 2023 and 2022, respectively.
Residential mortgage loans were $220.2 million, or 3.19% of gross loans, at December 31, 2023. We generally originate residential mortgage loans in amounts up to 80% of the appraised value or the sale price, whichever is less. Private mortgage insurance is required whenever loan-to-value ratios exceed 80% of the appraised value of the property securing the loan.
Residential mortgage loans were $244.3 million, or 3.63% of gross loans, at December 31, 2024. We generally originate residential mortgage loans in amounts up to 80% of the appraised value or the sale price, whichever is less. Private mortgage insurance is required whenever loan-to-value ratios exceed 80% of the appraised value of the property securing the loan.
Extensions, renewals, modifications or restructuring a loan, other than a loan that is experiencing financial difficulties which requires the loan to be fully underwritten in accordance with our policy. The borrower must be current to have a loan extended, renewed, or modified.
Extensions, renewals, modifications or restructurings of a loan, other than a loan that is experiencing financial difficulties, require the loan to be fully underwritten in accordance with our policy. The borrower must be current to have a loan extended, renewed, or modified.
The maximum amount of credit that the Bank can extend to any single borrower or related group of borrowers generally is limited to 15% of the Bank’s unimpaired capital and surplus, or $123.8 million at December 31, 2023.
The maximum amount of credit that the Bank can extend to any single borrower or related group of borrowers generally is limited to 15% of the Bank’s unimpaired capital and surplus, or $127.1 million at December 31, 2024.
Loans secured by commercial real estate were $1,958.3 million, or 28.39% of gross loans, at December 31, 2023. Our commercial real estate mortgage loans are secured by properties such as hotels/motels, small business facilities, strip shopping centers, warehouses, and office buildings.
Loans secured by commercial real estate were $1,973.1 million, or 29.28% of gross loans, at December 31, 2024. Our commercial real estate mortgage loans are secured by properties such as hotels/motels, small business facilities, strip shopping centers, warehouses, and office buildings.
The numbers contained in the column entitled “Percentage of Loans in Category to Total Loans” indicate the total amount of loans in each loan category as a percentage of our loan portfolio: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, ​ ​ 2023 ​ 2022 ​ 2021 ​ 2020 ​ 2019 ​ ​ ​ ​ ​ Percent ​ ​ ​ ​ Percent ​ ​ ​ ​ Percent ​ ​ ​ ​ Percent ​ ​ ​ ​ Percent ​ ​ ​ ​ ​ of Loans in ​ ​ ​ ​ of Loans in ​ ​ ​ ​ of Loans in ​ ​ ​ ​ of Loans in ​ ​ ​ ​ of Loans in ​ ​ ​ ​ Category to ​ ​ ​ Category to ​ ​ ​ Category to ​ ​ ​ Category to ​ ​ ​ Category to Loan Category Amount Total loans Amount Total loans Amount Total loans Amount Total loans Amount Total loans ​ ​ ​ (Dollars in thousands) Mortgage loans: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Multi-family residential ​ $ 10,373 38.53 % $ 9,552 37.57 % $ 8,185 37.94 % $ 6,557 37.81 % $ 5,391 38.88 % Commercial real estate ​ 8,665 28.39 ​ 8,184 27.62 ​ 7,158 26.77 ​ 8,327 26.18 ​ 4,429 27.48 ​ One-to-four family mixed-use property ​ 1,610 7.69 ​ 1,875 8.00 ​ 1,755 8.62 ​ 1,986 9.00 ​ 1,817 10.29 ​ One-to-four family residential ​ 668 3.19 ​ 901 3.48 ​ 784 4.17 ​ 869 3.78 ​ 756 3.42 ​ Construction ​ 158 0.85 ​ 261 1.02 ​ 186 0.90 ​ 497 1.24 ​ 441 1.18 ​ Gross mortgage loans ​ 21,474 78.65 ​ 20,773 77.69 ​ 18,068 78.40 ​ 18,236 78.01 ​ 12,834 81.25 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Commercial business loans: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Small Business Administration ​ 1,626 0.29 ​ 2,198 0.34 ​ 1,209 1.41 ​ 2,251 2.50 ​ 363 0.25 ​ Taxi medallion ​ — — ​ — — ​ — — ​ — 0.04 ​ — 0.06 ​ Commercial business and other ​ 17,061 21.06 ​ 17,471 21.97 ​ 17,858 20.19 ​ 24,666 19.45 ​ 8,554 18.44 ​ Gross commercial business loans ​ 18,687 21.35 ​ 19,669 22.31 ​ 19,067 21.60 ​ 26,917 21.99 ​ 8,917 18.75 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total loans ​ $ 40,161 100.00 % $ 40,442 100.00 % $ 37,135 100.00 % $ 45,153 100.00 % $ 21,751 100.00 % ​ Investment Activities Gen eral .
The numbers contained in the column entitled “Percentage of Loans in Category to Total Loans” indicate the total amount of loans in each loan category as a percentage of our loan portfolio: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, ​ ​ 2024 ​ 2023 ​ 2022 ​ 2021 ​ 2020 ​ ​ ​ ​ ​ Percent ​ ​ ​ ​ Percent ​ ​ ​ ​ Percent ​ ​ ​ ​ Percent ​ ​ ​ ​ Percent ​ ​ ​ ​ ​ of Loans in ​ ​ ​ ​ of Loans in ​ ​ ​ ​ of Loans in ​ ​ ​ ​ of Loans in ​ ​ ​ ​ of Loans in ​ ​ ​ ​ Category to ​ ​ ​ Category to ​ ​ ​ Category to ​ ​ ​ Category to ​ ​ ​ Category to Loan Category Amount Total loans Amount Total loans Amount Total loans Amount Total loans Amount Total loans ​ ​ ​ (Dollars in thousands) Mortgage loans: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Multi-family residential ​ $ 13,145 37.50 % $ 10,373 38.53 % $ 9,552 37.57 % $ 8,185 37.94 % $ 6,557 37.81 % Commercial real estate ​ 9,288 29.28 ​ 8,665 28.39 ​ 8,184 27.62 ​ 7,158 26.77 ​ 8,327 26.18 ​ One-to-four family mixed-use property ​ 1,623 7.59 ​ 1,610 7.69 ​ 1,875 8.00 ​ 1,755 8.62 ​ 1,986 9.00 ​ One-to-four family residential ​ 759 3.63 ​ 668 3.19 ​ 901 3.48 ​ 784 4.17 ​ 869 3.78 ​ Construction ​ 371 0.90 ​ 158 0.85 ​ 261 1.02 ​ 186 0.90 ​ 497 1.24 ​ Gross mortgage loans ​ 25,186 78.90 ​ 21,474 78.65 ​ 20,773 77.69 ​ 18,068 78.40 ​ 18,236 78.01 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Commercial business loans: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Small Business Administration ​ 1,523 0.30 ​ 1,626 0.29 ​ 2,198 0.34 ​ 1,209 1.41 ​ 2,251 2.50 ​ Taxi medallion ​ — — ​ — — ​ — — ​ — — ​ — 0.04 ​ Commercial business and other ​ 13,443 20.80 ​ 17,061 21.06 ​ 17,471 21.97 ​ 17,858 20.19 ​ 24,666 19.45 ​ Gross commercial business loans ​ 14,966 21.10 ​ 18,687 21.35 ​ 19,669 22.31 ​ 19,067 21.60 ​ 26,917 21.99 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total loans ​ $ 40,152 100.00 % $ 40,161 100.00 % $ 40,442 100.00 % $ 37,135 100.00 % $ 45,153 100.00 % ​ Investment Activities Gen eral .
We are required to develop and implement written policies and procedures to ensure the security of our information technology systems or non-public information that can be accessed by our vendors, including identifying the risks from third-party access, imposing minimum cybersecurity practices for vendors, and creating a due-diligence process for evaluating those vendors.
We are required to develop and implement written policies and procedures to ensure the security of our information technology systems or non-public information that can be accessed by our vendors, including identifying the risks from third-party access, imposing minimum cybersecurity practices for vendors, and creating a due-diligence process for evaluating those vendors. 35 Table of Contents Reports: The regulation imposes a notification process for any material cybersecurity event.
At December 31, 2023, our commercial real estate mortgage loans had an average principal balance of $2.5 million and the largest of such loans had a principal balance of $30.2 million. Commercial real estate mortgage loans are generally originated in a range of $100,000 to $10.0 million.
At December 31, 2024, our commercial real estate mortgage loans had an average principal balance of $2.6 million and the largest of such loans had a principal balance of $28.9 million. Commercial real estate mortgage loans are generally originated in a range of $100,000 to $10.0 million.
The following table sets forth our available for sale mortgage-backed securities purchases, sales and principal repayments for the years indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the years ended December 31, ​ 2023 2022 2021 ​ ​ (In thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at beginning of year ​ $ 384,283 ​ $ 572,184 ​ $ 404,460 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Purchases of mortgage-backed securities ​ 5,431 ​ 56,557 ​ 340,789 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortization of unearned premium, net of accretion of unearned discount ​ (975) ​ (2,007) ​ (2,943) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net change in unrealized gains (losses) on mortgage-backed securities available for sale ​ 6,392 ​ (64,164) ​ (15,232) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net gains (losses) recorded on mortgage-backed securities carried at fair value ​ 6 ​ (24) ​ (2) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Sales and maturities of mortgage-backed securities ​ - ​ (84,224) ​ (8,602) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Principal repayments received on mortgage-backed securities ​ (40,793) ​ (94,039) ​ (146,286) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net (decrease) increase in mortgage-backed securities ​ (29,939) ​ (187,901) ​ 167,724 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at end of year ​ $ 354,344 ​ $ 384,283 ​ $ 572,184 ​ While mortgage-backed securities carry a reduced credit risk as compared to whole loans, such securities remain subject to the risk that a fluctuating interest rate environment, along with other factors such as the geographic distribution of the underlying mortgage loans, may alter the prepayment rate of such mortgage loans and so affect both the prepayment speed and value of such securities. 25 Table of Contents The table below sets forth certain information regarding the amortized cost, fair value, annualized weighted average yields and maturities of our investment in debt and equity securities and interest-earning deposits at December 31, 2023.
The following table sets forth our available for sale mortgage-backed securities purchases, sales and principal repayments for the years indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the years ended December 31, ​ 2024 2023 2022 ​ ​ (In thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at beginning of year ​ $ 354,344 ​ $ 384,283 ​ $ 572,184 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Purchases of mortgage-backed securities ​ 1,009,611 ​ 5,431 ​ 56,557 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortization of unearned premium, net of accretion of unearned discount ​ (890) ​ (975) ​ (2,007) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net change in unrealized (losses) gains on mortgage-backed securities available for sale ​ 62,411 ​ 6,392 ​ (64,164) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net realized (losses) gains recorded on mortgage-backed securities carried at fair value ​ 6 ​ 6 ​ (24) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Sales and maturities of mortgage-backed securities ​ (386,382) ​ - ​ (84,224) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Principal repayments received on mortgage-backed securities ​ (127,464) ​ (40,793) ​ (94,039) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net (decrease) increase in mortgage-backed securities ​ 557,292 ​ (29,939) ​ (187,901) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at end of year ​ $ 911,636 ​ $ 354,344 ​ $ 384,283 ​ While mortgage-backed securities carry a reduced credit risk as compared to whole loans, such securities remain subject to the risk that a fluctuating interest rate environment, along with other factors such as the geographic distribution of the underlying mortgage loans, may alter the prepayment rate of such mortgage loans and so affect both the prepayment speed and value of such securities. 25 Table of Contents The table below sets forth certain information regarding the amortized cost, fair value, annualized weighted average yields and maturities of our investment in debt and equity securities and interest-earning deposits at December 31, 2024.
The provision recorded in 2023 was driven by fully reserving for two non-accrual business loans and increasing reserves for the elevated risk presented by the current rate environment to adjustable-rate loan’s debt coverage ratios.
The provision recorded in 2024 was driven by increased reserves on several commercial business and multi-family loans. The provision recorded in 2023 was driven by fully reserving for two non-accrual commercial business loans and increasing reserves for the elevated risk presented by the current rate environment to adjustable-rate loan’s debt coverage ratios.
When calculating the ACL estimate for December 31, 2023, the reasonable and supportable forecast was for a period of two quarters and the reversion period was four quarters. At December 31, 2023 and 2022, the ACL for loans totaled $40.2 million and $40.4 million, respectively. Non-performing loans totaled $25.2 million and $32.4 million at December 31, 2023 and 2022, respectively.
When calculating the ACL estimate for December 31, 2024, the reasonable and supportable forecast was for a period of two quarters and the reversion period was four quarters. At December 31, 2024 and 2023, the ACL for loans totaled $40.2 million each. Non-performing loans totaled $33.3 million and $25.2 million at December 31, 2024 and 2023, respectively.
At December 31, 2022, none of these deposits were classified as brokered deposits. At December 31, 2023, the Bank had uninsured deposits totaling $2.1 billion, or 30% of deposits with $0.9 billion of that fully collateralized by some other method leaving uninsured and uncollateralized deposits totaling $1.2 billion or 17% of deposits.
At December 31, 2023, the Bank had uninsured deposits totaling $2.1 billion, or 30% of deposits with $0.9 billion of that fully collateralized by some other method leaving uninsured and uncollateralized deposits totaling $1.2 billion or 17% of deposits.
See “— Regulation.” ​ The following table sets forth the composition of our loan portfolio at the dates indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, ​ ​ 2023 ​ 2022 ​ 2021 ​ 2020 ​ 2019 ​ ​ ​ ​ Percent ​ ​ ​ Percent ​ ​ ​ Percent ​ ​ ​ Percent ​ ​ ​ Percent ​ Amount of Total Amount of Total Amount of Total Amount of Total Amount of Total ​ ​ (Dollars in thousands) Mortgage Loans: ​ ​ ​ ​ ​ ​ ​ Multi-family residential ​ $ 2,658,205 38.53 % $ 2,601,384 37.57 % $ 2,517,026 37.94 % $ 2,533,952 37.81 % $ 2,238,591 38.88 % Commercial real estate (1) ​ 1,958,252 28.39 ​ 1,913,040 27.62 ​ 1,775,629 26.77 ​ 1,754,754 26.18 ​ 1,582,008 27.48 ​ One-to-four family - mixed-use property ​ 530,243 7.69 ​ 554,314 8.00 ​ 571,795 8.62 ​ 602,981 9.00 ​ 592,471 10.29 ​ One-to-four family - residential ​ 220,213 3.19 ​ 241,246 3.48 ​ 276,571 4.17 ​ 253,262 3.78 ​ 196,879 3.42 ​ Construction ​ 58,673 0.85 ​ 70,951 1.02 ​ 59,761 0.90 ​ ​ 83,322 1.24 ​ 67,754 1.18 ​ Gross mortgage loans ​ 5,425,586 78.65 ​ 5,380,935 77.69 ​ 5,200,782 78.40 ​ 5,228,271 78.01 ​ 4,677,703 81.25 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Commercial business loans: ​ ​ ​ ​ ​ ​ Small Business Administration ​ 20,205 0.29 ​ 23,275 0.34 ​ 93,811 1.41 ​ 167,376 2.50 ​ 14,445 0.25 ​ Taxi medallion ​ — — ​ — — ​ — — ​ 2,757 0.04 ​ 3,309 0.06 ​ Commercial business and other ​ 1,452,518 21.06 ​ 1,521,548 21.97 ​ 1,339,273 20.19 ​ 1,303,225 19.45 ​ 1,061,478 18.44 ​ Gross commercial business loans ​ 1,472,723 21.35 ​ 1,544,823 22.31 ​ 1,433,084 21.60 ​ 1,473,358 21.99 ​ 1,079,232 18.75 ​ Gross loans ​ 6,898,309 100.00 % 6,925,758 100.00 % 6,633,866 100.00 % 6,701,629 100.00 % 5,756,935 100.00 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Unearned loan fees and deferred costs, net ​ ​ 9,590 ​ ​ 9,011 ​ ​ 4,239 ​ ​ ​ 3,045 ​ ​ 15,271 ​ Unallocated portfolio layer basis adjustments (2) ​ (949) ​ ​ — ​ ​ — ​ ​ ​ — ​ ​ — ​ Less: Allowance for credit losses ​ (40,161) ​ ​ (40,442) ​ ​ (37,135) ​ ​ ​ (45,153) ​ ​ (21,751) ​ Loans, net ​ $ 6,866,789 ​ ​ ​ $ 6,894,327 ​ ​ ​ $ 6,600,970 ​ ​ ​ $ 6,659,521 ​ $ 5,750,455 ​ (1) Balance consists almost exclusively of investor commercial real estate (non-owner occupied).
See “— Regulation.” ​ The following table sets forth the composition of our loan portfolio at the dates indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, ​ ​ 2024 ​ 2023 ​ 2022 ​ 2021 ​ 2020 ​ ​ ​ ​ Percent ​ ​ ​ Percent ​ ​ ​ Percent ​ ​ ​ Percent ​ ​ ​ Percent ​ Amount of Total Amount of Total Amount of Total Amount of Total Amount of Total ​ ​ (Dollars in thousands) Mortgage Loans: ​ ​ ​ ​ ​ ​ ​ ​ Multi-family residential ​ $ 2,527,222 37.50 % $ 2,658,205 38.53 % $ 2,601,384 37.57 % $ 2,517,026 37.94 % $ 2,533,952 37.81 % Commercial real estate (1) ​ 1,973,124 29.28 ​ 1,958,252 28.39 ​ 1,913,040 27.62 ​ 1,775,629 26.77 ​ 1,754,754 26.18 ​ One-to-four family - mixed-use property ​ 511,222 7.59 ​ 530,243 7.69 ​ 554,314 8.00 ​ 571,795 8.62 ​ 602,981 9.00 ​ One-to-four family - residential ​ 244,282 3.63 ​ 220,213 3.19 ​ 241,246 3.48 ​ 276,571 4.17 ​ 253,262 3.78 ​ Construction ​ 60,399 0.90 ​ 58,673 0.85 ​ 70,951 1.02 ​ 59,761 0.90 ​ ​ 83,322 1.24 ​ Gross mortgage loans ​ 5,316,249 78.90 ​ 5,425,586 78.65 ​ 5,380,935 77.69 ​ 5,200,782 78.40 ​ 5,228,271 78.01 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Commercial business loans: ​ ​ ​ ​ ​ ​ Small Business Administration ​ 19,925 0.30 ​ 20,205 0.29 ​ 23,275 0.34 ​ 93,811 1.41 ​ 167,376 2.50 ​ Taxi medallion ​ — — ​ — — ​ — — ​ — — ​ 2,757 0.04 ​ Commercial business and other ​ 1,401,602 20.80 ​ 1,452,518 21.06 ​ 1,521,548 21.97 ​ 1,339,273 20.19 ​ 1,303,225 19.45 ​ Gross commercial business loans ​ 1,421,527 21.10 ​ 1,472,723 21.35 ​ 1,544,823 22.31 ​ 1,433,084 21.60 ​ 1,473,358 21.99 ​ Gross loans ​ 6,737,776 100.00 % 6,898,309 100.00 % 6,925,758 100.00 % 6,633,866 100.00 % 6,701,629 100.00 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Unearned loan fees and deferred costs, net ​ 10,097 ​ ​ 9,590 ​ ​ 9,011 ​ ​ 4,239 ​ ​ ​ 3,045 ​ ​ Unallocated portfolio layer basis adjustments (2) ​ (2,025) ​ ​ (949) ​ ​ — ​ ​ — ​ ​ ​ — ​ ​ Less: Allowance for credit losses ​ (40,152) ​ ​ (40,161) ​ ​ (40,442) ​ ​ (37,135) ​ ​ ​ (45,153) ​ ​ Loans, net ​ $ 6,705,696 ​ ​ ​ $ 6,866,789 ​ ​ ​ $ 6,894,327 ​ ​ ​ $ 6,600,970 ​ ​ ​ $ 6,659,521 ​ (1) Balance consists almost exclusively of investor commercial real estate (non-owner occupied).
Included within net loans as of December 31, 2023 and 2022, was a recorded investment of $4.8 million and $5.2 million, respectively, of consumer mortgage loans secured by residential real estate properties for which formal foreclosure proceedings were in process according to local requirements of the applicable jurisdiction. Environmental Concerns Relating to Loans.
Included within net loans as of December 31, 2024 and 2023, was a recorded investment of $2.7 million and $4.8 million, respectively, of consumer mortgage loans secured by residential real estate properties for which formal foreclosure proceedings were in process according to local requirements of the applicable jurisdiction. Criticized and Classified Assets.
At December 31, 2023, $395.6 million, or 14.88%, of our multi-family mortgage loans consisted of fixed rate loans. Our fixed-rate multi-family mortgage loans are generally originated for terms up to 15 years and are competitively priced based on market conditions and our cost of funds.
At December 31, 2024, $360.7 million, or 14.27%, of our multi-family mortgage loans consisted of fixed rate loans. Our fixed-rate multi-family mortgage loans are generally originated for terms up to 15 years and are competitively priced based on market conditions and our cost of funds.
This allows us to invest our funds in higher yielding assets. At December 31, 2023 and 2022, the Bank held IntraFi Network money market and demand deposits totaling $869.2 million and $654.2 million, respectively. At December 31, 2023, $110.2 million of these deposits were classified as brokered deposits.
This allows us to invest our funds in higher yielding assets. At December 31, 2024 and 2023, the Bank held IntraFi Network money market and demand deposits totaling $721.8 million and $869.2 million, respectively. At December 31, 2024 $18.3 thousand were classified as brokered deposits, while at December 31, 2023, $110.2 million of these deposits were classified as brokered deposits.
However, this potential risk is lessened by our policy of originating one-to-four family residential ARM loans with annual and lifetime interest rate caps that limit the increase of a borrower’s monthly payment. At December 31, 2023, $22.8 million, or 10.34%, of our residential mortgage loans consisted of fixed-rate loans.
However, this potential risk is lessened by our policy of originating one-to-four family residential ARM loans with annual and lifetime interest rate caps that limit the increase of a borrower’s monthly payment. At December 31, 2024, $18.9 million, or 7.91%, of our residential mortgage loans consisted of fixed-rate loans.
At December 31, 2023 and 2022, total deposits at our Internet Branch were $183.8 million and $154.6 million, respectively. The government banking unit provides banking services to public municipalities, including counties, cities, towns, villages, school districts, libraries, fire districts, and the various courts throughout the New York City metropolitan area.
At December 31, 2024 26 Table of Contents and 2023, total deposits at our Internet Branch were $149.2 million and $183.8 million, respectively. The government banking unit provides banking services to public municipalities, including counties, cities, towns, villages, school districts, libraries, fire districts, and the various courts throughout the New York City metropolitan area.
The repayment of principal is primarily dependent on the successful operation of the underlying tenant’s business. At December 31, 2023, $1,760.8 million, or 89.92%, of our commercial mortgage loans consisted of ARM loans. We offer ARM loans with adjustment periods of one to five years and generally for terms of up to 15 years.
The repayment of principal is primarily dependent on the successful operation of the underlying tenant’s business. At December 31, 2024, $1,776.6 million, or 90.04%, of our commercial mortgage loans consisted of ARM loans. We offer ARM loans with adjustment periods of one to five years and generally for terms of up to 15 years.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

39 edited+3 added−4 removed85 unchanged
Biggest changeHowever, we may not be aware of such uses or risks in any particular case, and, accordingly, there can be no assurance that real estate acquired by us in foreclosure is free from environmental contamination nor we will not have any liability with respect thereto. 51 Table of Contents Changes and uncertainty in United States legislation, policy or regulation regarding climate risk management or other ESG practices may result in higher regulatory and compliance costs, increased capital expenditures, and changes in regulations may impact security asset prices, resulting in realized or unrealized losses on our investments.
Biggest changeHowever, we may not be aware of such uses or risks in any particular case, and, accordingly, there can be no assurance that real estate acquired by us in foreclosure is free from environmental contamination nor we will not have any liability with respect thereto.
Our market area has a high density of financial institutions, many of which have greater financial resources, name recognition and market presence than us, and all of which are our competitors to varying degrees. Particularly intense competition exists for deposits and in all of the lending activities we emphasize.
Our market area has a high density of financial institutions, many of which have greater financial resources, name recognition and market presence than us, and all of which are our competitors to varying degrees. Particularly intense competition exists for deposits and in all the lending activities we emphasize.
Changes in Interest Rates May Impact Our Financial Condition and Results of Operations Our primary source of income is net interest income, which is the difference between the interest income generated by our interest-earning assets (consisting primarily of multi-family residential loans, investment property commercial business loans and commercial real estate mortgage loans) and the interest expense paid on our interest-bearing liabilities (consisting primarily of deposits and borrowings).
Changes in Interest Rates May Impact Our Financial Condition and Results of Operations Our primary source of income is net interest income, which is the difference between the interest income generated by our interest-earning assets (consisting primarily of multi-family residential loans, investment property commercial business loans, commercial real estate mortgage loans and investment securities) and the interest expense paid on our interest-bearing liabilities (consisting primarily of deposits and borrowings).
In addition, the estimated fair value of our fixed-rate assets, such as our securities portfolios, would decline (and our unrealized gains on such assets would ordinarily decrease and unrealized losses would ordinarily increase) if interest rates increase. However, the derivative portfolio increases in fair value as interest rates increase, partially mitigating the effects of such increases on other securities.
In addition, the estimated fair value of our fixed-rate assets, such as our securities portfolios, would decline (and our unrealized gains on such assets would ordinarily decrease and unrealized losses would ordinarily increase) if interest rates increased. However, the derivative portfolio increases in fair value as interest rates increase, partially mitigating the effects of such increases on other securities.
Unlike non-brokered certificates of deposit where the deposit amount can be withdrawn with a penalty for any reason, including increasing interest rates, a brokered certificate of deposit can only be withdrawn in the event of the death or court declared mental incompetence of the depositor.
Unlike non-brokered certificates of deposit where the deposit amount can be withdrawn with a penalty for any reason, including increasing interest rates, a brokered certificates of deposit can only be withdrawn in the event of the death or court declared mental incompetence of the depositor.
FDIC regulations limit brokered deposits. Under the regulations, well-capitalized institutions are not subject to brokered deposit limitations, while adequately capitalized institutions are able to accept, renew or roll over brokered deposits only with a waiver from the FDIC and subject to restrictions on the interest rate that can be paid on such deposits.
Under the regulations, well-capitalized institutions are not subject to brokered deposit limitations, while adequately capitalized institutions are able to accept, renew or roll over brokered deposits only with a waiver from the FDIC and subject to restrictions on the interest rate that can be paid on such deposits. Undercapitalized institutions are not permitted to accept brokered deposits.
We closely monitor and respond to topics related to ESG that include longer lifespans, income and wealth inequalities, environmental challenges and opportunities to expand global access to the financial system across all segments of the population. Updated and changing regulatory and societal environment requirements could impact financial and operational results.
We closely monitor and respond to emerging topics that include longer lifespans, income and wealth inequalities, environmental challenges and opportunities to expand global access to the financial system across all segments of the population. Updated and changing regulatory and societal environment requirements could impact financial and operational results.
Information security risks for financial institutions have generally increased in recent years in part because of the proliferation of new technologies, the use of the internet and telecommunications technologies to conduct financial 48 Table of Contents transactions, and the increased sophistication and activities of organized crime, hackers, terrorists, activists, and other external parties.
Information security risks for financial institutions have generally increased in recent years in part because of the proliferation of new technologies, the use of the internet and telecommunications technologies to conduct financial transactions, and the increased sophistication and activities of organized crime, hackers, terrorists, activists, and other external parties.
There can be no assurance as to the impact that any laws, regulations or governmental programs 47 Table of Contents that may be introduced or implemented in the future will have on the financial markets and the economy, any of which could adversely affect our business.
There can be no assurance as to the impact that any laws, regulations or governmental programs that may be introduced or implemented in the future will have on the financial markets and the economy, any of which could adversely affect our business.
In addition, a large percentage of our investment securities and mortgage-backed securities have fixed interest rates and are classified as available for sale. As is the case with many financial institutions, our emphasis on increasing the generation of core deposits, those with no stated maturity date, has resulted in our interest-bearing liabilities having a shorter duration than our interest-earning assets.
In addition, we have certain investment securities and mortgage-backed securities that have fixed interest rates and are classified as available for sale. As is the case with many financial institutions, our emphasis on increasing the generation of core deposits, those with no stated maturity date, has resulted in our interest-bearing liabilities having a shorter duration than our interest-earning assets.
Depositors tend to open longer term, higher costing certificate of deposit accounts which could adversely affect our net interest income if rates were to subsequently decline. Additionally, adjustable-rate mortgage loans and mortgage-backed securities generally contain interim and lifetime caps that limit the amount the interest rate can increase or decrease at repricing dates.
Depositors tend to open longer term, higher costing certificates of deposit accounts which could adversely affect our net interest income if rates were to subsequently decline. Additionally, 45 Table of Contents adjustable-rate mortgage loans and mortgage-backed securities generally contain interim and lifetime caps that limit the amount the interest rate can increase or decrease at repricing dates.
The Bank faces several minimum capital requirements imposed by federal regulation. Failure to adhere to these minimums could limit the dividends the Bank may pay, including the payment of dividends to the Company, and could limit the annual growth of the Bank.
The Bank faces several minimum capital requirements imposed by federal regulation. Failure to adhere to these minimums could limit the dividends the Bank may pay, including the payment of dividends to the Company, and could 48 Table of Contents limit the annual growth of the Bank.
The legal and regulatory risks related to safeguarding personal information and the harm that could be caused by a successful cyber-attack affecting Flushing Bank are proactively monitored and addressed according to current regulations and bank policies.
The legal and regulatory risks related to safeguarding personal information and the harm that could be caused by a successful cyber-attack affecting Flushing Bank are proactively monitored and addressed according to 50 Table of Contents current regulations and bank policies.
The rate we pay on brokered money market accounts is similar to the rate we pay on non-brokered money market accounts, and the rate is agreed to in a contract between the Bank and the broker.
The rate we pay on brokered money market accounts is similar to the rate we pay on non-brokered money market accounts, and the 46 Table of Contents rate is agreed to in a contract between the Bank and the broker.
The repayment of commercial business loans (the increased origination of which is part of management’s strategy), is contingent on the successful operation of the related business. 45 Table of Contents Changes in local economic conditions and government regulations, which are outside the control of the borrower or lender, also could affect the value of the security for the loan or the future cash flow of the affected properties.
The repayment of commercial business loans is contingent on the successful operation of the related business. Changes in local economic conditions and government regulations, which are outside the control of the borrower or lender, also could affect the value of the security for the loan or the future cash flow of the affected properties.
Many factors could require additions to our allowance for credit losses in future periods above those currently maintained.
Many factors could 47 Table of Contents require additions to our allowance for credit losses in future periods above those currently maintained.
Our interest rate risk has been partially mitigated by the addition of certain derivative financial 44 Table of Contents instruments and we believe that our current interest rate position is more neutral, with a bias toward liability sensitivity.
Our interest rate risk has been partially mitigated by the addition of certain derivative financial instruments along with additional floating rate assets and we believe that our current interest rate position is more neutral, with a bias toward liability sensitivity.
Most of these real estate loans were secured by multi-family residential property ($2,658.2 million), commercial real estate property ($1,958.3 million) and one-to-four family mixed-use property ($530.2 million), which combined represented 74.6% of our loan portfolio. Our loan portfolio is concentrated in the New York City metropolitan area.
Most of these real estate loans were secured by multi-family residential property ($2,527.2 million), commercial real estate property ($1,973.1 million) and one-to-four family mixed-use property ($511.2 million), which combined represented 74.4% of our loan portfolio. Our loan portfolio is concentrated in the New York City metropolitan area.
See “— Local Economic Conditions. ​ Our Lending Activities Involve Risks that May Be Exacerbated Depending on the Mix of Loan Types At December 31, 2023, our gross loan portfolio was $6,898.3 million, of which 88.9% was loans secured by real estate.
See “— Local Economic Conditions. ​ Our Lending Activities Involve Risks that May Be Exacerbated Depending on the Mix of Loan Types At December 31, 2024, our gross loan portfolio was $6,737.8 million, of which 90.0% was loans secured by real estate.
The inability to hire or retain key personnel may result in the loss of customer relationships and may adversely affect our financial condition or results of operations.
As a result, it could prove difficult to retain and attract key personnel. The inability to hire or retain key personnel may result in the loss of customer relationships and may adversely affect our financial condition or results of operations.
As of December 31, 2023, total deposit balances include brokered deposits of money market deposits of $96.6 million, certificates of deposits of $818.3 million, and NOW deposits of $187.1 million. As of December 31, 2022, total deposit balances include brokered deposits of money market deposits of $329.0 million, certificates of deposits of $446.8 million, and NOW deposits of $80.5 million.
As of December 31, 2023, total deposit balances include brokered deposits of money market deposits of $96.6 million, certificates of deposit of $818.3 million, and NOW deposits of $187.1 million. FDIC regulations limit brokered deposits.
Current Conditions in, and Regulation of, the Banking Industry May Have a Material Adverse Effect on Our Results of Operations Financial institutions have been the subject of significant legislative and regulatory changes, including the adoption of The Dodd Frank Act, which imposes a wide variety of regulations affecting us, and may be the subject of further significant legislation or regulation in the future, none of which is within our control.
Physical risks and transitional risks could increase the Company’s cost of doing business and actual or perceived failure to adequately address expectations of our various stakeholders could lead to a tarnished reputation and loss of customers and clients Current Conditions in, and Regulation of, the Banking Industry May Have a Material Adverse Effect on Our Results of Operations Financial institutions have been the subject of significant legislative and regulatory changes, including the adoption of The Dodd Frank Act, which imposes a wide variety of regulations affecting us, and may be the subject of further significant legislation or regulation in the future, none of which is within our control.
The FOMC raised the target range for the federal funds rate four times during 2023 from a range of 4.50% to 4.75% in March to a range of 5.25% to 5.50% in July. There can be no assurances as to any future FOMC decisions on interest rates.
The FOMC decreased the target range for the federal funds rate three times and by 100 basis points during 2024 from a range of 5.25% to 5.50% in September, to a range of 4.25% to 4.50% in December. There can be no assurances as to any future FOMC decisions on interest rates.
We may be subject to increasingly more risk related to cybersecurity for our Internet Branch as we expand our suite of online direct banking products, acquire new or outsource some of our business operations, expand our internal usage of web-based products and applications, and otherwise attempt to keep pace with rapid technological changes in the financial services industry.
We may be subject to increasingly more risk related to cybersecurity for our Internet Branch as we expand our suite of online direct banking products, acquire new or outsource some of our business operations, expand our internal usage of web-based products and applications, and otherwise attempt to keep pace with rapid technological changes in the financial services industry. 49 Table of Contents We rely on external infrastructure, proprietary information technology and third-party systems and services to conduct business, including customer service, marketing and sales activities, customer relationship management, producing financial statements and technology/data centers.
As a result of our historical focus on the origination of multi-family residential mortgage loans, commercial business loans and commercial real estate mortgage loans, most of our loans are adjustable rate, however, many adjust at periods of five to 10 years.
There can be no assurance that such derivatives will remain effective in such mitigation nor that our interest rate position will remain as is and be appropriate in our operating environment. ​ As a result of our historical focus on the origination of multi-family residential mortgage loans, commercial business loans and commercial real estate mortgage loans, most of our loans are adjustable rate, however, many adjust at periods of five to 10 years.
Should this occur, it might be difficult to replace the maturing certificates with new brokered certificates of deposit or 46 Table of Contents other wholesale funding.
The maturity of brokered certificates of deposit could result in a significant funding source maturing at one time. Should this occur, it might be difficult to replace the maturing certificates with new brokered certificates of deposit or other wholesale funding.
Although we seek to manage our investment risks by maintaining a diversified portfolio and monitor our investments on an ongoing basis, allowing us to adjust our exposure to sectors and/or geographical areas that face severe risks due to climate change, there can be no assurances that our efforts will be successful. ​ Our Financial Results May be Adversely Impacted by ESG Requirements Our financial and operational results could be impacted by emerging risk and changes to the regulatory landscape in areas like environmental, social and governance (“ESG”) requirements.
Although we seek to manage our investment risks by maintaining a diversified portfolio and monitor our investments on an ongoing basis, allowing us to adjust our exposure to sectors and/or geographical areas that face severe risks due to climate change, there can be no assurances that our efforts will be successful. ​ Item 1B. Unresolved Staff Comments. None. ​
Delays in foreclosure sales, including any delays beyond those currently anticipated could increase the costs associated with our mortgage operations and make it more difficult for us to prevent losses in our loan portfolio. 50 Table of Contents ​ Our Inability to Hire or Retain Key Personnel Could Adversely Affect Our Business Our success depends, in large part, on our ability to retain and attract key personnel.
Delays in foreclosure sales, including any delays beyond those currently anticipated could increase the costs associated with our mortgage operations and make it more difficult for us to prevent losses in our loan portfolio.
Although we have historically declared cash dividends on our common stock, we are not required to do so and may reduce or eliminate our common stock dividend in the future. A reduction or elimination of our common stock dividend could adversely affect the market price of our common stock. Our Financial Results May be Adversely Impacted by Global Climate Changes.
Although we have historically declared cash dividends on our common stock, we are not required to do so and may reduce or eliminate our common stock dividend in the future.
Additionally, we place a portion of our government deposits in the IntraFi Network money market or demand product, allowing us to invest our funds in higher yielding assets without providing collateral.
Additionally, we place a portion of our government deposits in the IntraFi Network money market or demand product, allowing us to invest our funds in higher yielding assets without providing collateral. As of December 31, 2024, total deposit balances include brokered deposits of money market deposits of $73.6 million, certificates of deposit of $1,094.0 million, NOW deposits of $151.4 million.
For a discussion of regulations affecting us, see “Business — Regulation” and “Business — Federal, State and Local Taxation” in Item 1 of this Annual Report.
For a discussion of regulations affecting us, see “Business — Regulation” and “Business — Federal, State and Local Taxation” in Item 1 of this Annual Report. Our financial and operational results could be impacted by emerging risk and changes to the regulatory landscape.
Limitations on the Bank’s ability to accept brokered deposits for any reason (including limitations on the amount of brokered deposits in total or as a percentage of total assets) could materially adversely impact our funding costs and liquidity. The maturity of brokered certificates of deposit could result in a significant funding source maturing at one time.
However, there can be no assurance that the Bank will continue to meet those requirements. Limitations on the Bank’s ability to accept brokered deposits for any reason (including limitations on the amount of brokered deposits in total or as a percentage of total assets) could materially adversely impact our funding costs and liquidity.
Atmospheric concentrations of carbon dioxide and other greenhouse gases have increased dramatically since the industrial revolution, resulting in a gradual increase in average global temperatures and an increase in the frequency and severity of weather patterns and natural disasters.
A reduction or elimination of our common stock dividend could adversely affect the market price of our common stock. ​ 51 Table of Contents Our Financial Results May be Adversely Impacted by Global Climate Changes Atmospheric concentrations of carbon dioxide and other greenhouse gases have increased dramatically since the industrial revolution, resulting in a gradual increase in average global temperatures and an increase in the frequency and severity of weather patterns and natural disasters.
We rely on external infrastructure, proprietary information technology and third-party systems and services to conduct business, including customer service, marketing and sales activities, customer relationship management, producing financial statements and technology/data centers. In addition, we store and process confidential and proprietary business information on both company-owned and third-party and/or vendor managed systems, including cloud service providers.
In addition, we store and process confidential and proprietary business information on both company-owned and third-party and/or vendor managed systems, including cloud service providers.
As technology evolves, we can increase our ability to detect and prevent cyber-attacks through automation and the implementation of security controls which leverage machine 49 Table of Contents learning and artificial intelligence.
As technology evolves, we can increase our ability to detect and prevent cyber-attacks through automation and the implementation of security controls which leverage machine learning and artificial intelligence. As threats continue to evolve, we may be required to expend additional resources to continue to modify or enhance our protective measures or to investigate and remediate information security vulnerabilities.
The Bank had $1,102.0 million or 16.2% of total deposits and $856.3 million, or 13.2% of total deposits, in brokered deposit accounts as of December 31, 2023 and 2022, respectively.
The Bank had $1,319.0 million or 18.4% of total deposits and $1,102.0 million, or 16.2% of total deposits, in brokered deposit accounts as of December 31, 2024 and 2023, respectively. At December 31, 2024 approximately $875.8 million are hedged using interest rate swaps.
As threats continue to evolve, we may be required to expend additional resources to continue to modify or enhance our protective measures or to investigate and remediate information security vulnerabilities. Additionally, information security vulnerabilities can pose increased cyber-risk as they can be combined and chained together more easily with machine learning technology.
Additionally, information security vulnerabilities can pose increased cyber-risk as they can be combined and chained together more easily with machine learning technology.
We face intense competition from commercial banks, savings banks, savings and loan associations, mortgage banking companies, insurance companies, finance companies and credit unions. As a result, it could prove difficult to retain and attract key personnel.
Our Inability to Hire or Retain Key Personnel Could Adversely Affect Our Business Our success depends, in large part, on our ability to retain and attract key personnel. We face intense competition from commercial banks, savings banks, savings and loan associations, mortgage banking companies, insurance companies, finance companies and credit unions.
Undercapitalized institutions are not permitted to accept brokered deposits. Pursuant to the regulation, the Bank, as a well-capitalized institution, may accept brokered deposits. Should our capital ratios decline, this could limit our ability to replace brokered deposits when they mature.
Pursuant to the regulation, the Bank, as a well-capitalized institution, may accept brokered deposits. Should our capital ratios decline, this could limit our ability to replace brokered deposits when they mature. As of December 31, 2024, the Bank met or exceeded all applicable requirements to be deemed “well-capitalized” for purposes of these regulations.
Removed
There can be no assurance that such derivatives will remain effective in such mitigation nor that our interest rate position will remain as is and be appropriate in our operating environment.
Added
It is possible that due to changes in fiscal and economic policies, including tariffs, US economic activity may slow or decrease in 2025, applying pressure on interest rates.
Removed
In line with the foregoing, we have experienced and may continue to experience an increase in the cost of interest-bearing liabilities primarily due to raising the rates we pay on some of our deposit products to stay competitive within our market and an increase in borrowing costs from increases in the federal funds rate.
Added
Economic weakness or persistent inflation could lead to decreased business and consumer confidence and weaker-than-anticipated spending, thereby leading to increased interest rates and other related possible adverse impacts to our business including asset quality, deposit levels, loan demand and results of operations.
Removed
As of December 31, 2023, the Bank met or exceeded all applicable requirements to be deemed “well-capitalized” for purposes of these regulations. However, there can be no assurance that the Bank will continue to meet those requirements.
Added
Changes and uncertainty in United States legislation, policy or regulation regarding climate risk management or other practices may result in higher regulatory and compliance costs, increased capital expenditures, and changes in regulations may impact security asset prices, resulting in realized or unrealized losses on our investments.
Removed
Physical risks and transitional risks could increase the Company’s cost of doing business and actual or perceived failure to adequately address ESG expectations of our various stakeholders could lead to a tarnished reputation and loss of customers and clients. Item 1B. Unresolved Staff Comments. None. ​

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThe cybersecurity programs include a cross-function team of trained internal and external information security professionals, all of whom are required to maintain industry accredited certifications. We have an Incident Response Team chaired by our Chief Operating Officer that is comprised of executive management and designated managers, including the CISO.
Biggest changeWe have an Incident Response Team chaired by our Chief Operating Officer that is comprised of executive management and designated managers, including the CISO.
The Risk and Compliance Committee consists of eight directors, seven of whom are independent, while the Information Technology Committee consists of three directors, two of whom are members of the Risk and Compliance Committee. The Company Board includes members who have expertise in cybersecurity, fraud, and risk management.
The Risk and Compliance Committee consists of eight directors, seven of whom are independent, while the Information Technology Committee consists of three directors, two of whom are independent and members of the Risk and Compliance Committee. The Company Board includes members who have expertise in cybersecurity, fraud, and risk management.
Management Role and Board Oversight The cybersecurity programs are supervised by the Bank’s Chief Information Security Officer (“CISO”) reporting to the Chief Risk Officer (“CRO”) and dotted line to the Chief Information Officer.
Management Role and Board Oversight The cybersecurity programs are supervised by the Bank’s Chief Information Security Officer (“ CISO ”) reporting to the Chief Risk Officer (“CRO”) and dotted line to the Chief Information Officer.
Our CISO oversees proactive initiatives, remediation plans of known risks, compliance with regulations and standards and disaster recovery, business continuity, and incident response efforts. Additionally, the Bank’s CRO who leads the management risk function, has extensive experience in risk management.
Our CISO oversees proactive initiatives, remediation plans of known risks, compliance with regulations and standards and disaster recovery, business continuity, and incident response efforts.
Cybersecurity threats are identified utilizing risk assessments, detection tools, information gathering and performing internal, external, and third-party contracted security assessments. 52 Table of Contents Cybersecurity Threats To assess and manage cybersecurity threats, the Company maintains an Incident Response Team comprised of members from the major business areas in the Company to ensure appropriate subject matter specialists are represented.
Cybersecurity Threats To assess and manage cybersecurity threats, the Company maintains an Incident Response Team comprised of members from the major business areas in the Company to ensure appropriate subject matter specialists are represented.
Managing Material Risks and Integrated Overall Risk Management The Company maintains documented processes, procedures, and controls for assessing, identifying, and managing material risks from cybersecurity threats.
Managing Material Risks and Integrated Overall Risk Management The Company maintains documented processes, procedures, and controls for assessing, identifying, and managing material risks from cybersecurity threats . Cybersecurity threats are identified utilizing risk assessments, detection tools, information gathering and performing internal, external, and third-party contracted security assessments.
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Additionally, the Bank’s CRO who leads the management risk function, has extensive experience in risk management. 52 Table of Contents The cybersecurity programs include a cross-function team of trained internal and external information security professionals, all of whom are required to maintain industry accredited certifications.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Properties. As of December 31, 2023, the Bank conducted its business through 27 full-service offices and its Internet Branch. The Company neither owns nor leases any property but instead uses the premises and equipment of the Bank. ​
Biggest changeItem 2. Properties. As of December 31, 2024, the Bank conducted its business through 28 full-service offices and its Internet Branch. The Company neither owns nor leases any property but instead uses the premises and equipment of the Bank. ​ 53 Table of Contents

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. Legal Proceedings. We are involved in various legal actions arising in the ordinary course of our business which, in the aggregate, involve amounts which are believed by management to be immaterial to our financial condition, results of operations and cash flows. ​ Item 4. Mine Safety Disclosures. Not applicable. ​ 53 Table of Contents PART II
Biggest changeItem 3. Legal Proceedings. We are involved in various legal actions arising in the ordinary course of our business which, in the aggregate, involve amounts which are believed by management to be immaterial to our financial condition, results of operations and cash flows. ​ Item 4. Mine Safety Disclosures. Not applicable. ​ PART II

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeItem 4. Mine Safety Disclosures ​ 53 PART II ​ ​ Item 5. Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities ​ 54 Item 6. Reserved ​ 55 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations ​ 56 Item 7A.
Biggest changeItem 4. Mine Safety Disclosures ​ 54 PART II ​ ​ Item 5. Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities ​ 54 Item 6. Reserved ​ 56 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations ​ 57 Item 7A.
Quantitative and Qualitative Disclosures About Market Risk ​ 69 Item 8. Financial Statements and Supplementary Data ​ 70
Quantitative and Qualitative Disclosures About Market Risk ​ 70 Item 8. Financial Statements and Supplementary Data ​ 71

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe following table sets forth securities authorized for issuance under all equity compensation plans of the Company at December 31, 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (c) ​ ​ ​ ​ ​ ​ ​ Number of securities ​ ​ ​ ​ ​ ​ ​ remaining available for ​ ​ (a) ​ (b) ​ future issuance under ​ ​ Number of securities to ​ Weighted-average ​ equity compensation ​ ​ be issued upon exercise ​ exercise price of ​ plans (excluding ​ ​ of outstanding options, ​ outstanding options, ​ securities reflected in ​ ​ warrants and rights ​ warrants and rights ​ column (a) ​ ​ ​ ​ ​ ​ ​ ​ Equity compensation plans approved by security holders — ​ $ — 746,910 ​ ​ ​ ​ ​ ​ ​ ​ Equity compensation plans not approved by security holders — ​ — — ​ ​ ​ ​ ​ ​ ​ ​ ​ — ​ $ — 746,910 ​ 54 Table of Contents Stock Performance Graph The following graph shows a comparison of cumulative total stockholder return on the Company’s common stock since December 31, 2018 with the cumulative total returns of a broad equity market index as well as comparative published industry indices.
Biggest changeThere is no expiration or maximum dollar amount under this authorization. 54 Table of Contents The following table sets forth securities authorized for issuance under all equity compensation plans of the Company at December 31, 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (c) ​ ​ ​ ​ ​ ​ ​ Number of securities ​ ​ ​ ​ ​ ​ ​ remaining available for ​ ​ (a) ​ (b) ​ future issuance under ​ ​ Number of securities to ​ Weighted-average ​ equity compensation ​ ​ be issued upon exercise ​ exercise price of ​ plans (excluding ​ ​ of outstanding options, ​ outstanding options, ​ securities reflected in ​ ​ warrants and rights ​ warrants and rights ​ column (a) ​ ​ ​ ​ ​ ​ ​ ​ Equity compensation plans approved by security holders — ​ $ — 974,000 ​ ​ ​ ​ ​ ​ ​ ​ Equity compensation plans not approved by security holders — ​ — — ​ ​ ​ ​ ​ ​ ​ ​ ​ — ​ $ — 974,000 ​ 55 Table of Contents Stock Performance Graph The following graph shows a comparison of cumulative total stockholder return on the Company’s common stock since December 31, 2019 with the cumulative total returns of a broad equity market index as well as comparative published industry indices.
The Holding Company’s Common Stock is traded on the NASDAQ Global Select Market ® under the symbol “FFIC.” As of December 31, 2023, we had approximately 814 shareholders of record, not including the number of persons or entities holding stock in nominee or street name through various brokers and banks. ​ The following table sets forth information regarding the shares of common stock repurchased by us during the quarter ended December 31, 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Maximum ​ ​ ​ ​ ​ ​ ​ Total Number of ​ Number of ​ ​ Total ​ ​ ​ ​ Shares Purchased ​ Shares That May ​ ​ Number ​ ​ ​ ​ as Part of Publicly ​ Yet Be Purchased ​ ​ of Shares ​ Average Price ​ Announced Plans ​ Under the Plans Period ​ Purchased ​ Paid per Share ​ or Programs ​ or Programs October 1 to October 31, 2023 ​ — ​ $ — ​ — ​ 846,779 November 1 to November 30, 2023 ​ — ​ ​ — ​ — ​ 846,779 December 1 to December 31, 2023 ​ 38,815 ​ ​ 15.08 ​ 38,815 ​ 807,964 Total 38,815 ​ $ 15.08 38,815 ​ ​ On July 27, 2021, the Company announced the authorization by the Board of Directors of a common stock repurchase program, which authorizes the purchase of up to 1,000,000 shares of its common stock.
The Holding Company’s Common Stock is traded on the NASDAQ Global Select Market ® under the symbol “FFIC.” As of December 31, 2024, we had approximately 796 shareholders of record, not including the number of persons or entities holding stock in nominee or street name through various brokers and banks. ​ The following table sets forth information regarding the shares of common stock repurchased by us during the quarter ended December 31, 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Maximum ​ ​ ​ ​ ​ ​ ​ Total Number of ​ Number of ​ ​ Total ​ ​ ​ ​ Shares Purchased ​ Shares That May ​ ​ Number ​ ​ ​ ​ as Part of Publicly ​ Yet Be Purchased ​ ​ of Shares ​ Average Price ​ Announced Plans ​ Under the Plans Period ​ Purchased ​ Paid per Share ​ or Programs ​ or Programs October 1 to October 31, 2024 ​ — ​ ​ — ​ — ​ 807,964 November 1 to November 30, 2024 ​ — ​ ​ — ​ — ​ 807,964 December 1 to December 31, 2024 ​ — ​ ​ — ​ — ​ 807,964 Total — ​ $ — — ​ ​ On July 27, 2021, the Company announced the authorization by the Board of Directors of a common stock repurchase program, which authorizes the purchase of up to 1,000,000 shares of its common stock.
The graph below reflects historical performance only, which is not indicative of possible future performance of the common stock. ​ ​ The total return assumes $100 invested on December 31, 2018 and all dividends reinvested through the end of the Company’s fiscal year ended December 31, 2023.
The graph below reflects historical performance only, which is not indicative of possible future performance of the common stock. ​ ​ The total return assumes $100 invested on December 31, 2019 and all dividends reinvested through the end of the Company’s fiscal year ended December 31, 2024.
Stock will be purchased under the current stock repurchase program from time to time, in the open market or through private transactions subject to market conditions and at the discretion of the management of the Company. There is no expiration or maximum dollar amount under this authorization.
Stock will be purchased under the current stock repurchase program from time to time, in the open market or through private transactions subject to market conditions and at the discretion of the management of the Company.
During the years ended December 31, 2023 and 2022, the Company repurchased 786,498 shares and 1,253,725 shares, respectively, of the Company’s common stock at an average cost of $14.59 per share and $21.73 per share, respectively. At December 31, 2023, 807,964 shares remain to be repurchased under the current stock repurchase program.
During the year ended December 31, 2023, the Company repurchased 786,498 shares of the Company’s common stock at an average cost of $14.59 per share, respectively. At December 31, 2024, 807,964 shares remained available to be repurchased under the current stock repurchase program.
This program was completed in 2022 and on May 17, 2022, an additional 1,000,000 share authorization was announced. This program was completed in 2023 and on May 31, 2023, an additional 1,000,000 share authorization was announced.
This program was completed in 2022 and on May 17, 2022, an additional 1,000,000 share authorization was announced. This program was completed in 2023 and on May 31, 2023, an additional 1,000,000 share authorization was announced. During the year ended December 31, 2024, the Company did not repurchase any of the Company’s common stock.
The performance graph above is based upon closing prices on the trading date specified. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Period Ending Index 12/31/18 12/31/19 12/31/20 12/31/21 12/31/22 12/31/23 Flushing Financial Corporation 100.00 ​ 104.39 ​ 85.49 ​ 129.36 ​ 107.48 ​ 97.23 NASDAQ Composite Index 100.00 ​ 136.69 ​ 198.10 ​ 242.03 ​ 163.28 ​ 236.17 S&P U.S.
The performance graph above is based upon closing prices on the trading date specified. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Period Ending Index 12/31/19 12/31/20 12/31/21 12/31/22 12/31/23 12/31/24 Flushing Financial Corporation 100.00 ​ 81.90 ​ 123.92 ​ 102.96 ​ 93.15 85.99 NASDAQ Composite Index 100.00 ​ 144.92 ​ 177.06 ​ 119.45 ​ 172.77 223.87 S&P U.S.
Removed
MidCap Banks Index 100.00 ​ 131.89 ​ 130.44 ​ 189.83 ​ 139.58 ​ 104.07 S&P U.S. BMI Banks - Mid-Atlantic Region Index 100.00 ​ 142.19 ​ 128.53 ​ 162.33 ​ 137.10 ​ 166.23 ​ ​
Added
MidCap Banks Index 100.00 ​ 98.90 ​ 143.93 ​ 105.83 ​ 78.90 105.26 S&P U.S. BMI Banks - Mid-Atlantic Region Index 100.00 ​ 90.39 ​ 114.16 ​ 96.42 ​ 116.90 162.46 ​ ​

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeThe yields include amortization of fees that are considered adjustments to yields. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ ​ 2023 ​ 2022 ​ 2021 ​ ​ Average ​ ​ ​ ​ Yield/ ​ Average ​ ​ ​ ​ Yield/ ​ Average ​ ​ ​ ​ Yield/ ​ ​ Balance Interest Cost Balance Interest Cost Balance Interest Cost ​ ​ (Dollars in thousands) Assets ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Interest-earning assets: ​ ​ ​ ​ ​ ​ ​ Mortgage loans, net (1)(2) ​ $ 5,328,067 ​ $ 267,178 5.01 % $ 5,253,104 ​ $ 228,065 4.34 % $ 5,146,195 ​ $ 217,580 4.23 % Other loans, net (1)(2) ​ 1,517,282 ​ 88,170 5.81 ​ 1,488,486 ​ 65,222 4.38 ​ 1,498,122 ​ 56,751 3.79 ​ Total loans, net ​ 6,845,349 ​ 355,348 5.19 ​ 6,741,590 ​ 293,287 4.35 ​ 6,644,317 ​ 274,331 4.13 ​ Taxable securities: ​ ​ ​ ​ ​ ​ ​ Mortgage-backed securities ​ 442,228 ​ 11,505 2.60 ​ 573,314 ​ 9,414 1.64 ​ 550,136 ​ 8,335 1.52 ​ Other securities ​ 485,118 ​ 24,700 5.09 ​ 324,112 ​ 9,771 3.01 ​ 239,208 ​ 4,001 1.67 ​ Total taxable securities ​ 927,346 ​ 36,205 3.90 ​ 897,426 ​ 19,185 2.14 ​ 789,344 ​ 12,336 1.56 ​ Tax-exempt securities: (3) ​ ​ ​ ​ ​ ​ ​ Other securities ​ 66,533 ​ 1,923 2.89 ​ 64,822 ​ 2,197 3.39 ​ 50,831 ​ 2,142 4.21 ​ Total tax-exempt securities ​ 66,533 ​ 1,923 2.89 ​ 64,822 ​ 2,197 3.39 ​ 50,831 ​ 2,142 4.21 ​ Interest-earning deposits and federal funds sold ​ 184,565 ​ 8,405 4.55 ​ 131,816 ​ 2,418 1.83 ​ 188,462 ​ 203 0.11 ​ Total interest-earning assets ​ 8,023,793 ​ 401,881 5.01 ​ 7,835,654 ​ 317,087 4.05 ​ 7,672,954 ​ 289,012 3.77 ​ Other assets ​ 477,771 ​ ​ ​ ​ 471,483 ​ ​ ​ ​ 470,418 ​ ​ ​ Total assets ​ $ 8,501,564 ​ ​ ​ ​ ​ ​ $ 8,307,137 ​ ​ ​ ​ ​ ​ $ 8,143,372 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Interest-bearing liabilities: ​ ​ ​ ​ ​ ​ ​ ​ ​ Deposits: ​ ​ ​ ​ ​ ​ ​ ​ ​ Savings accounts ​ $ 121,102 ​ 520 ​ 0.43 ​ $ 153,605 ​ 211 ​ 0.14 ​ $ 157,640 ​ 255 0.16 ​ NOW accounts ​ 1,937,974 ​ 64,191 ​ 3.31 ​ 1,976,238 ​ 15,353 ​ 0.78 ​ 2,165,762 ​ 5,453 0.25 ​ Money market accounts ​ 1,754,059 ​ 58,898 ​ 3.36 ​ 2,191,768 ​ 19,039 ​ 0.87 ​ 2,059,431 ​ 7,271 0.35 ​ Certificate of deposit accounts ​ 2,091,677 ​ 64,844 ​ 3.10 ​ 1,031,024 ​ 12,547 ​ 1.22 ​ 1,033,187 ​ 7,340 0.71 ​ Total due to depositors ​ 5,904,812 ​ 188,453 ​ 3.19 ​ 5,352,635 ​ 47,150 ​ 0.88 ​ 5,416,020 ​ 20,319 0.38 ​ Mortgagors' escrow accounts ​ 81,015 ​ 202 ​ 0.25 ​ 80,021 ​ 135 ​ 0.17 ​ 77,552 ​ 5 0.01 ​ Total interest-bearing deposits ​ 5,985,827 ​ 188,655 ​ 3.15 ​ 5,432,656 ​ 47,285 ​ 0.87 ​ 5,493,572 ​ 20,324 0.37 ​ Borrowings ​ 776,050 ​ 33,670 ​ 4.34 ​ 1,012,149 ​ 25,725 ​ 2.54 ​ 905,094 ​ 20,269 2.24 ​ Total interest-bearing liabilities ​ 6,761,877 ​ 222,325 ​ 3.29 ​ 6,444,805 ​ 73,010 ​ 1.13 ​ 6,398,666 ​ 40,593 0.63 ​ Non interest-bearing demand deposits ​ 867,667 ​ ​ ​ ​ ​ 1,019,090 ​ ​ ​ ​ ​ 922,741 ​ ​ ​ Other liabilities ​ 196,869 ​ ​ ​ ​ ​ 170,500 ​ ​ ​ ​ ​ 173,019 ​ ​ ​ Total liabilities ​ 7,826,413 ​ ​ ​ ​ ​ 7,634,395 ​ ​ ​ 7,494,426 ​ ​ ​ Equity ​ 675,151 ​ ​ ​ ​ ​ 672,742 ​ ​ ​ 648,946 ​ ​ ​ Total liabilities and equity ​ $ 8,501,564 ​ ​ ​ ​ ​ ​ $ 8,307,137 ​ ​ ​ ​ $ 8,143,372 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net interest income (loss) / net interest rate spread (4) ​ ​ ​ ​ $ 179,556 ​ 1.72 % ​ ​ ​ $ 244,077 ​ 2.92 % ​ ​ $ 248,419 ​ 3.14 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net interest-earning assets / net interest margin (5) ​ $ 1,261,916 ​ ​ ​ 2.24 % $ 1,390,849 ​ ​ ​ 3.11 % $ 1,274,288 ​ ​ ​ 3.24 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ratio of interest-earning assets to interest-bearing liabilities ​ ​ ​ ​ ​ 1.19 X ​ ​ ​ 1.22 X ​ ​ ​ 1.20 X (1) Average balances include non-accrual loans.
Biggest changeThe yields include amortization of fees that are considered adjustments to yields. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ ​ 2024 ​ 2023 ​ 2022 ​ ​ Average ​ ​ ​ ​ Yield/ ​ Average ​ ​ ​ ​ Yield/ ​ Average ​ ​ ​ ​ Yield/ ​ ​ Balance Interest Cost Balance Interest Cost Balance Interest Cost ​ ​ (Dollars in thousands) Assets ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Interest-earning assets: ​ ​ ​ ​ ​ ​ ​ Loans held for sale ​ $ 192 ​ $ 7 3.65 % $ — ​ $ — — % $ — ​ $ — — % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Mortgage loans, net (1)(2) ​ ​ 5,346,975 ​ ​ 291,437 5.45 ​ ​ 5,328,067 ​ ​ 267,178 5.01 ​ ​ 5,253,104 ​ ​ 228,065 4.34 ​ Other loans, net (1)(2) ​ 1,420,424 ​ 84,134 5.92 ​ 1,517,282 ​ 88,170 5.81 ​ 1,488,486 ​ 65,222 4.38 ​ Total loans, net ​ 6,767,399 ​ 375,571 5.55 ​ 6,845,349 ​ 355,348 5.19 ​ 6,741,590 ​ 293,287 4.35 ​ Taxable securities: ​ ​ ​ ​ ​ ​ ​ Mortgage-backed securities ​ 765,700 ​ 37,485 4.90 ​ 442,228 ​ 11,505 2.60 ​ 573,314 ​ 9,414 1.64 ​ Other securities ​ 655,428 ​ 40,230 6.14 ​ 485,118 ​ 24,700 5.09 ​ 324,112 ​ 9,771 3.01 ​ Total taxable securities ​ 1,421,128 ​ 77,715 5.47 ​ 927,346 ​ 36,205 3.90 ​ 897,426 ​ 19,185 2.14 ​ Tax-exempt securities: (3) ​ ​ ​ ​ ​ ​ ​ Other securities ​ 65,245 ​ 1,887 2.89 ​ 66,533 ​ 1,923 2.89 ​ 64,822 ​ 2,197 3.39 ​ Total tax-exempt securities ​ 65,245 ​ 1,887 2.89 ​ 66,533 ​ 1,923 2.89 ​ 64,822 ​ 2,197 3.39 ​ Interest-earning deposits and federal funds sold ​ 218,829 ​ 10,578 4.83 ​ 184,565 ​ 8,405 4.55 ​ 131,816 ​ 2,418 1.83 ​ Total interest-earning assets ​ 8,472,793 ​ 465,758 5.50 ​ 8,023,793 ​ 401,881 5.01 ​ 7,835,654 ​ 317,087 4.05 ​ Other assets ​ 481,698 ​ ​ ​ ​ 477,771 ​ ​ ​ ​ 471,483 ​ ​ ​ ​ Total assets ​ $ 8,954,491 ​ ​ ​ ​ ​ ​ $ 8,501,564 ​ ​ ​ ​ ​ ​ $ 8,307,137 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Interest-bearing liabilities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Deposits: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Savings accounts ​ $ 102,843 ​ 472 ​ 0.46 ​ $ 121,102 ​ 520 ​ 0.43 ​ $ 153,605 ​ 211 ​ 0.14 ​ NOW accounts ​ 1,965,774 ​ 75,683 ​ 3.85 ​ 1,937,974 ​ 64,191 ​ 3.31 ​ 1,976,238 ​ 15,353 ​ 0.78 ​ Money market accounts ​ 1,699,869 ​ 67,992 ​ 4.00 ​ 1,754,059 ​ 58,898 ​ 3.36 ​ 2,191,768 ​ 19,039 ​ 0.87 ​ Certificates of deposit accounts ​ 2,604,817 ​ 100,235 ​ 3.85 ​ 2,091,677 ​ 64,844 ​ 3.10 ​ 1,031,024 ​ 12,547 ​ 1.22 ​ Total due to depositors ​ 6,373,303 ​ 244,382 ​ 3.83 ​ 5,904,812 ​ 188,453 ​ 3.19 ​ 5,352,635 ​ 47,150 ​ 0.88 ​ Mortgagors' escrow accounts ​ 82,095 ​ 254 ​ 0.31 ​ 81,015 ​ 202 ​ 0.25 ​ 80,021 ​ 135 ​ 0.17 ​ Total interest-bearing deposits ​ 6,455,398 ​ 244,636 ​ 3.79 ​ 5,985,827 ​ 188,655 ​ 3.15 ​ 5,432,656 ​ 47,285 ​ 0.87 ​ Borrowings ​ 795,348 ​ 38,715 ​ 4.87 ​ 776,050 ​ 33,670 ​ 4.34 ​ 1,012,149 ​ 25,725 ​ 2.54 ​ Total interest-bearing liabilities ​ 7,250,746 ​ 283,351 ​ 3.91 ​ 6,761,877 ​ 222,325 ​ 3.29 ​ 6,444,805 ​ 73,010 ​ 1.13 ​ Non interest-bearing demand deposits ​ 843,151 ​ ​ ​ ​ ​ 867,667 ​ ​ ​ ​ ​ 1,019,090 ​ ​ ​ ​ ​ Other liabilities ​ 189,808 ​ ​ ​ ​ ​ 196,869 ​ ​ ​ ​ ​ 170,500 ​ ​ ​ ​ ​ Total liabilities ​ 8,283,705 ​ ​ ​ ​ ​ 7,826,413 ​ ​ ​ ​ ​ 7,634,395 ​ ​ ​ Equity ​ 670,786 ​ ​ ​ ​ ​ 675,151 ​ ​ ​ ​ ​ 672,742 ​ ​ ​ Total liabilities and equity ​ $ 8,954,491 ​ ​ ​ ​ ​ ​ $ 8,501,564 ​ ​ ​ ​ ​ ​ $ 8,307,137 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net interest income / net interest rate spread (4) ​ ​ ​ ​ $ 182,407 ​ 1.59 % ​ ​ ​ $ 179,556 ​ 1.72 % ​ ​ ​ $ 244,077 ​ 2.92 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net interest-earning assets / net interest margin (5) ​ $ 1,222,047 ​ ​ ​ 2.15 % $ 1,261,916 ​ ​ ​ 2.24 % $ 1,390,849 ​ ​ ​ 3.11 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ratio of interest-earning assets to interest-bearing liabilities ​ ​ ​ ​ ​ 1.17 X ​ ​ ​ ​ 1.19 X ​ ​ ​ 1.22 X (1) Average balances include non-accrual loans.
The Company quantifies the net portfolio value should interest rates immediately go up or down 200 basis points, assuming the yield curves of the rate shocks will be parallel to each other. Net portfolio value is defined as the market value of assets net of the market value of liabilities.
The Company quantifies the net portfolio value should interest rates immediately go up or down 100 or 200 basis points, assuming the yield curves of the rate shocks will be parallel to each other. Net portfolio value is defined as the market value of assets net of the market value of liabilities.
We assess interest rate risk by comparing the results of several income and capital simulations scenarios to the base case with changes in interest rates, degree of change over time, speed of change, and changes in the shape of the yield curve.
We assess interest rate risk by comparing the results of several income and capital simulations scenarios to the base case compared to scenarios with changes in interest rates, degree of change over time, speed of change, and changes in the shape of the yield curve.
Overview Our principal business is attracting retail deposits from the general public and investing those deposits together with funds generated from ongoing operations and borrowings, primarily in (1) originations and purchases of multi-family residential properties, commercial business loans, commercial real estate mortgage loans and, to a lesser extent, one-to-four family (focusing on mixed-use properties, which are properties that contain both residential dwelling units and commercial units); (2) construction loans; (3) Small Business Administration (“SBA”) loans; (4) mortgage loan surrogates such as mortgage-backed securities; and (5) U.S. government securities, corporate fixed-income securities and other marketable securities.
Overview Our principal business is attracting retail deposits from the general public and investing those deposits together with funds generated from ongoing operations and borrowings, primarily in (1) originations and purchases of multi-family residential properties, commercial business loans, commercial real estate mortgage loans and, to a lesser extent, one-to-four family (focusing on mixed-use properties, which are properties that contain both residential dwelling units and commercial units); (2) construction loans; (3) equipment financing loans; (4) Small Business Administration (“SBA”) loans; (5) mortgage loan surrogates such as mortgage-backed securities; and (6) U.S. government securities, corporate fixed-income securities and other marketable securities.
Such classifications are used by the FDIC and other bank regulatory agencies to determine matters ranging from each institution’s quarterly FDIC deposit insurance premium assessments, to approvals of applications authorizing institutions to grow their asset size or otherwise expand business activities. At December 31, 2023 and 2022, the Bank and the Company exceeded each of their four regulatory capital requirements.
Such classifications are used by the FDIC and other bank regulatory agencies to determine matters ranging from each institution’s quarterly FDIC deposit insurance premium assessments, to approvals of applications authorizing institutions to grow their asset size or otherwise expand business activities. At December 31, 2024 and 2023, the Bank and the Company exceeded each of their four regulatory capital requirements.
By contrast, an increasing interest rate environment would tend to extend the average lives of lower yielding fixed rate mortgages and mortgage-backed securities, which could adversely affect net interest income. In addition, depositors tend to open longer term, higher costing certificate of deposit accounts which could adversely affect our net interest income if rates were to subsequently decline.
By contrast, an increasing interest rate environment would tend to extend the average lives of lower yielding fixed rate mortgages and mortgage-backed securities, which could adversely affect net interest income. In addition, depositors tend to open longer term, higher costing certificates of deposit accounts which could adversely affect our net interest income if rates were to subsequently decline.
The Bank owned two subsidiaries during 2023: Flushing Service Corporation, and FSB Properties Inc. The Bank also operates an internet branch, which operates under the brands of iGObanking® and BankPurely® (the “Internet Branch”). The Bank’s primary regulator is the New York State Department of Financial Services, and its primary federal regulator is the Federal Deposit Insurance Corporation (“FDIC”).
The Bank owned two subsidiaries: Flushing Service Corporation, and FSB Properties Inc. The Bank also operates an internet branch, which operates under the brands of iGObanking® and BankPurely® (the “Internet Branch”). The Bank’s primary regulator is the New York State Department of Financial Services, and its primary federal regulator is the Federal Deposit Insurance Corporation (“FDIC”).
The Bank is not permitted to declare or pay a dividend or to repurchase any of its capital stock if the effect would be to cause the Bank’s regulatory capital to be reduced below the amount required for the liquidation account but approval of the NYDFS Superintendent (the “Superintendent”) is required if the total of all dividends declared by the Bank in a calendar year would exceed the total of its net profits for that year combined with its retained net profits for the preceding two years less prior dividends paid.
The Bank is not permitted to declare or pay a dividend or to repurchase any of its capital stock if the effect would be to cause the Bank’s regulatory capital to be reduced 67 Table of Contents below the amount required for the liquidation account but approval of the NYDFS Superintendent (the “Superintendent”) is required if the total of all dividends declared by the Bank in a calendar year would exceed the total of its net profits for that year combined with its retained net profits for the preceding two years less prior dividends paid.
(3) Interest and yields are calculated on the tax equivalent basis using statutory federal income tax rate of 21% for the years ended December 31, 2023, 2022, and 2021. (4) Interest rate spread represents the difference between the average rate on interest-earning assets and the average cost of interest-bearing liabilities.
(3) Interest and yields are calculated on the tax equivalent basis using statutory federal income tax rate of 21% for the years ended December 31, 2024, 2023, and 2022. (4) Interest rate spread represents the difference between the average rate on interest-earning assets and the average cost of interest-bearing liabilities.
In calculating the ACL, the Company specifies both the reasonable and supportable forecast and reversion periods in three economic conditions (expansion, transition, contraction). When calculating the ACL estimate for December 31, 2023 and 2022, the reasonable and supportable forecast was for a period of two quarters and the reversion period was four quarters.
In calculating the ACL, the Company specifies both the reasonable and supportable forecast and reversion periods in three economic conditions (expansion, transition, contraction). When calculating the ACL estimate for December 31, 2024 and 2023, the reasonable and supportable forecast was for a period of two quarters and the reversion period was four quarters.
The significant unobservable inputs used in the fair value measurement of the Company’s trust preferred securities and junior subordinated debentures valued under Level 3 at December 31, 2023 and 2022, are the effective yields used in the cash flow models.
The significant unobservable inputs used in the fair value measurement of the Company’s trust preferred securities and junior subordinated debentures valued under Level 3 at December 31, 2024 and 2023, are the effective yields used in the cash flow models.
The balance of the liquidation account at December 31, 2023 was $0.3 million. In the unlikely event of a complete liquidation of the Bank, each eligible account holder will be entitled to receive a distribution from the liquidation account.
The balance of the liquidation account at December 31, 2024 was $0.3 million. In the unlikely event of a complete liquidation of the Bank, each eligible account holder will be entitled to receive a distribution from the liquidation account.
Discussion and analysis of our 2022 fiscal year specifically, as well as the year-over-year comparison of our 2022 financial performance to 2021, are located under Part II, Item 7 – Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on March 14, 2023, which is available on our investor relations website at FlushingBank.com and the SEC’s website at sec.gov.
Discussion and analysis of our 2023 fiscal year specifically, as well as the year-over-year comparison of our 2023 financial performance to 2022, are located under Part II, Item 7 – Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on March 15, 2024, which is available on our investor relations website at FlushingBank.com and the SEC’s website at sec.gov.
Our operating expenses consist principally of employee compensation and benefits, occupancy and equipment costs, other general and administrative expenses and income tax expense. Our results of operations can also be significantly affected by our periodic provision for credit losses and specific provision for losses on real estate owned. 56 Table of Contents Management Strategy.
Our operating expenses consist principally of employee compensation and benefits, occupancy and equipment costs, other general and administrative expenses and income tax expense. Our results of operations can also be significantly affected by our periodic provision for credit losses and specific provision for losses on real estate owned. Management Strategy.
(5) Net interest margin represents net interest income (loss) before the provision for credit losses divided by average interest-earning assets. 62 Table of Contents Rate/Volume Analysis The following table presents the impact of changes in interest rates and in the volume of interest-earning assets and interest-bearing liabilities on the Company’s interest income and interest expense during the periods indicated.
(5) Net interest margin represents net interest income before the provision for credit losses divided by average interest-earning assets. 63 Table of Contents Rate/Volume Analysis The following table presents the impact of changes in interest rates and in the volume of interest-earning assets and interest-bearing liabilities on the Company’s interest income and interest expense during the periods indicated.
Significant increases or decreases in the effective yield in isolation would result in a significantly lower or higher fair value measurement. See Notes 2 (“Summary of Significant Accounting Policies”), 6 (“Securities”) and 19 (“Fair Value of Financial Instruments”) of Notes to the Consolidated Financial Statements. Goodwill Impairment.
Significant increases or decreases in the effective yield in isolation would result in a significantly lower or higher fair value measurement. See Notes 2 69 Table of Contents (“Summary of Significant Accounting Policies”), 6 (“Securities”) and 19 (“Fair Value of Financial Instruments”) of Notes to the Consolidated Financial Statements. Goodwill Impairment.
The change in the discount rate is the only significant change made to the assumptions used for these plans for each of the three years ended December 31, 2023.
The change in the discount rate is the only significant change made to the assumptions used for these plans for each of the three years ended December 31, 2024.
At December 31, 2023, the fair value of our reporting unit is derived using a combination of an asset approach, and an income approach.
At December 31, 2024, the fair value of our reporting unit is derived using a combination of an asset approach, and an income approach.
The Company has identified four accounting policies that require significant management valuation judgment: the allowance for credit losses, fair value of financial instruments, goodwill impairment and income taxes. Allowance for Credit Losses.
The Company has identified four accounting policies that require significant management valuation judgment: the allowance for credit losses, fair value of financial instruments, goodwill impairment and income taxes. 68 Table of Contents Allowance for Credit Losses.
Included in net interest income was prepayment penalty income and net recoveries/(reversals) loans and securities totaling $2.3 million and $6.4 million for the years ended December 31, 2023 and 2022, respectively, net gains (losses) from fair value adjustments on hedges totaling $0.4 million and $0.8 million for the years ended December 31, 2023 and 2022, respectively, swap termination fees totaling $3.0 million and none for the years ended December 31, 2023 and 2022, respectively, and purchase accounting income of $1.5 million and $2.5 million for the years ended December 31, 2023 and 2022, respectively.
Included in net interest income was prepayment penalty income and net recoveries/(reversals) loans and securities totaling $3.5 million and $2.3 million for the years ended December 31, 2024 and 2023, respectively, net gains (losses) from fair value adjustments on hedges and swap termination fees totaling $3.5 million and $3.3 million for the years ended December 31, 2024 and 2023, respectively, and purchase accounting income of $0.8 million and $1.5 million for the years ended December 31, 2024 and 2023, respectively.
During the years ended December 31, 2023, 2022, and 2021, the actual (loss) return on the employee pension plan assets was approximately 15%, (658%), and (154%), respectively, of the assumed return used to determine the periodic pension expense for that respective year.
During the years ended December 31, 2024, 2023, and 2022, the actual (loss) return on the employee pension plan assets was approximately (105%), 15%, and (658%), respectively, of the assumed return used to determine the periodic pension expense for that respective year.
The following table sets forth certain information relating to our Consolidated Statements of Financial Condition and Consolidated Statements of Income for the years ended December 31, 2023, 2022, and 2021, and reflects the average yield on assets and average cost of liabilities for the periods indicated.
The following table sets forth certain information relating to our Consolidated Statements of Financial Condition and Consolidated Statements of Operations for the years ended December 31, 2024, 2023, and 2022, and reflects the average yield on assets and average cost of liabilities for the periods indicated.
Actual results could differ significantly from these estimates. ​ At December 31, 2023, the Company had a derivative portfolio with a notional value totaling $2.5 billion compared to $1.4 billion at December 31, 2022. This portfolio is designed to provide protection against rising interest rates. See Note 20 (“Derivative Financial Instruments”) of the Notes to the Consolidated Financial Statements.
Actual results could differ significantly from these estimates. ​ At December 31, 2024 and 2023, the Company had a derivative portfolio with a notional value totaling $2.5 billion. This portfolio is designed to provide protection against rising interest rates. See Note 20 (“Derivative Financial Instruments”) of the Notes to the Consolidated Financial Statements.
The market value of the assets of our employee pension plan is $19.2 million at December 31, 2023, which is $2.2 million more than the projected benefit obligation. We do not anticipate a change in the market value of these assets which would have a significant effect on liquidity, capital resources, or results of operations.
The market value of the assets of our employee pension plan is $17.9 million at December 31, 2024, which is $2.1 million more than the projected benefit obligation. We do not anticipate a change in the market value of these assets which would have a significant effect on liquidity, capital resources, or results of operations.
At December 31, 2023, our employee pension plan had an unrecognized loss of $4.0 million. The medical and life insurance plan and non-employee director plan had unrecognized gains of $2.3 million and $1.2 million, respectively.
At December 31, 2024, our employee pension plan had an unrecognized loss of $4.4 million. The medical and life insurance plan and non-employee director plan had unrecognized gains of $2.1 million and $1.1 million, respectively.
Excluding prepayment penalty income from loans and securities, net recoveries/(reversals) of interest from non-accrual loans, net gains from fair value adjustments on hedges, swap termination fees and purchase accounting adjustments, the yield on total loans, net, increased 88 basis points to 5.08% for the year ended December 31, 2023 from 4.20% for the year ended December 31, 2022.
Excluding prepayment penalty income from loans and securities, net recoveries/(reversals) of interest from non-accrual loans, net gains from fair value adjustments on hedges, swap termination fees and purchase accounting adjustments, the yield on total loans, net, increased 40 basis points to 5.48% for the year ended December 31, 2024 from 5.08% for the year ended December 31, 2023.
During the year ended December 31, 2023, the Bank recorded net charge-offs totaling $10.8 million compared to $1.5 million recorded in the comparable prior year period. The average loan-to-value ratio for our non-performing assets collateralized by real estate was 51.7% at December 31, 2023. The Bank continues to maintain conservative underwriting standards. Non-Interest Income.
During the year ended December 31, 2024, the Bank recorded net charge-offs totaling $7.7 million compared to $10.8 million recorded in the comparable prior year period. The average loan-to-value ratio for our non-performing assets collateralized by real estate was 57.2% at December 31, 2024. The Bank continues to maintain conservative underwriting standards. Non-Interest (Loss) Income.
(2) Loan interest income (loss) includes loan fee income (loss)(which includes net amortization of deferred fees and costs, late charges, and prepayment penalties) of approximately $0.8 million, $7.8 million, and $10.6 million for the years ended December 31, 2023, 2022, and 2021, respectively.
(2) Loan interest income includes net loan fee income (which includes net amortization of deferred fees and costs, late charges, and prepayment penalties) of approximately $1.0 million, $0.8 million, and $7.8 million for the years ended December 31, 2024, 2023, and 2022, respectively.
The base interest rate scenario assumes interest rates at December 31, 2023 and 2022. Various estimates regarding prepayment assumptions are made at each level of rate shock.
The base interest rate scenario assumes interest rates at December 31, 2024. Various estimates regarding prepayment assumptions are made at each level of rate shock.
The allowance 67 Table of Contents for credit losses is estimated utilizing internal and external data, information derived from historical events, current conditions, and economic forecasts.
The allowance for credit losses is estimated utilizing internal and external data, information derived from historical events, current conditions, and economic forecasts.
The results of this process, support management’s assessment as to the adequacy of the ACL at each balance sheet date. In determining the allowance for credit losses, assumptions are input for economic forecasts, baseline loss rates, prepayment rates, utilization rates for off-balance sheet commitments, and forecast and reversion periods.
The results of this process support management’s assessment as to the adequacy of the ACL at each period end presented in the Consolidated Statements of Financial Condition. In determining the allowance for credit losses, assumptions are input for economic forecasts, baseline loss rates, prepayment rates, utilization rates for off-balance sheet commitments, and forecast and reversion periods.
Based on these assumptions, net interest income would be reduced by 2.4% from a 200 basis point increase in rates over the next twelve months and be reduced by 0.5% from a 200 basis point decrease in rates over the same period.
Prepayment penalty income is excluded from this analysis. Based on these assumptions, net interest income would be reduced by 5.4% from a 200 basis point increase in rates over the next twelve months and increase by 0.5% from a 200 basis point decrease in rates over the same period.
Excluding all of these items, the net interest margin for the year ended December 31, 2023 was 2.15%, a decrease of 84 basis points, from 2.99% for the year ended December 31, 2022. Provision (Benefit) for Credit Losses .
Excluding all of these items, the net interest margin for the year ended December 31, 2024 was 2.06%, a decrease of nine basis points, from 2.15% for the year ended December 31, 2023. Provision for Credit Losses .
The loan commitments generally expire in 90 days, while construction loan lines of credit mature within 18 months and home equity loan lines of credit mature within 10 years. We use the same credit policies in making commitments and conditional obligations as we do for on-balance-sheet instruments.
The loan commitments generally expire in 90 days, while construction loan lines of credit mature within 18 months and home equity loan lines of credit mature within 10 years. We use the same credit policies in making commitments and conditional obligations as we do for on-balance-sheet instruments. See Note 16 (“Commitments and Contingencies”) in Notes to the Consolidated Financial Statements.
The increase in interest expense was primarily due to an increase of 216 basis points in the average cost of interest-bearing liabilities to 3.29% for the year ended December 31, 2023 from 1.13% for the year ended December 31, 2022, coupled with an increase of $317.1 million in the average balance of interest-bearing liabilities to $6,761.9 million for the twelve months ended December 31, 2023 from $6,444.8 million for the comparable prior year period.
The increase in interest expense was primarily due to an increase of 62 basis points in the average cost of interest-bearing liabilities to 3.91% for the year ended December 31, 2024 from 3.29% for the year ended December 31, 2023, coupled with an increase of $488.9 million in the average balance of interest-bearing liabilities to $7,250.7 million for the twelve months ended December 31, 2024 from $6,761.9 million for the comparable prior year period.
The effective tax rate was 28.0% for the year ended December 31, 2023 compared to 26.6% in the prior year. Liquidity, Regulatory Capital and Capital Resources Liquidity and Capital Resources . Liquidity is the ability to economically meet current and future financial obligations.
The effective tax rate was 35.1% for the year ended December 31, 2024 compared to 28.0% in the prior year. 65 Table of Contents Liquidity, Regulatory Capital and Capital Resources Liquidity and Capital Resources . Liquidity is the ability to economically meet current and future financial obligations.
Interest rate risk is the impact on earnings and capital from changes in interest rates. Interest rate risk exists because our interest-earning assets and interest-bearing liabilities may mature or reprice at different times or by different amounts.
Approximately 86% of our certificates of deposit accounts and borrowings will reprice or mature during the next year. Interest Rate Risk Interest rate risk is the impact on earnings and capital from changes in interest rates. Interest rate risk exists because our interest-earning assets and interest-bearing liabilities may mature or reprice at different times or by different amounts.
As used in this discussion and analysis, the words “we,” “us,” “our” and the “Company” are used to refer to Flushing Financial Corporation (the “Holding Company”) and its direct and indirect wholly owned subsidiaries, Flushing Bank (the “Bank”), Flushing Service Corporation, FSB Properties Inc., and Flushing Preferred Funding Corporation, which was dissolved as of June 30, 2021.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations. As used in this discussion and analysis, the words “we,” “us,” “our” and the “Company” are used to refer to Flushing Financial Corporation (the “Holding Company”) and its direct and indirect wholly owned subsidiaries, Flushing Bank (the “Bank”), Flushing Service Corporation and FSB Properties Inc.
A portion of this portfolio is comprised of forward swaps on certain short-term advances and brokered deposits totaling $825.8 million at December 31, 2023, $775.8 million of the forward starting swaps are effective swaps at a weighted average rate of 2.39% compared to $591.5 million at 2.41% at December 31, 2022.
A portion of this portfolio is comprised of cash flow hedges on certain short-term advances and brokered deposits totaling $950.8 million at December 31, 2024. At December 31, 2024, $875.8 million of the cash flow hedges are effective swaps at a weighted average rate of 2.46% compared to $775.8 million at 2.39% at December 31, 2023.
The employee pension plan is the only plan that we have funded. During 2023, we incurred cash expenditures of $0.1 million for each of 65 Table of Contents the medical and life insurance plans and the non-employee director plan. We did not make a contribution to the employee pension plan in 2023.
The employee pension plan is the only plan that we have funded. During 2024, we incurred cash expenditures of $0.1 million for the medical and life insurance plans and $24,000 for the non-employee director plan. We did not make a contribution to the employee pension plan in 2024. We expect to pay similar amounts for these plans in 2025.
We expect to pay similar amounts for these plans in 2024. See Note 12 (“Pension and Other Postretirement Benefit Plan”) of Notes to the Consolidated Financial Statements. The amounts reported in our financial statements are obtained from reports prepared by independent actuaries and are based on significant assumptions.
See Note 12 (“Pension and Other Postretirement Benefit Plan”) of Notes to the Consolidated Financial Statements. The amounts reported in our financial statements are obtained from reports prepared by independent actuaries and are based on significant assumptions. The most significant assumption is the discount rate used to determine the accumulated postretirement benefit obligation (“APBO”) for these plans.
The increase in interest income was primarily due to an increase of 96 basis points in the yield of interest-earning assets to 5.01% for the year ended December 31, 2023 from 4.05% for the year ended December 31, 2022, coupled with an increase of $188.1 million in the average balance of interest-earning assets to $8,023.8 million for the year ended December 31, 2023 from $7,835.7 million for the year ended December 31, 2022.
The increase in interest income was primarily due to an increase of 49 basis points in the yield of interest-earning assets to 5.50% for the year ended December 31, 2024 from 5.01% for the year ended December 31, 2023, coupled with an increase of $449.0 million in the average balance of interest-earning assets to $8,472.8 million for the year ended December 31, 2024 from $8,023.8 million for the year ended December 31, 2023.
Net income for the twelve months ended December 31, 2023 was $28.7 million, a decrease of $48.3 million, or 62.7%, compared to $76.9 million for the twelve months ended December 31, 2022.
Net (loss) income for the twelve months ended December 31, 2024 was ($31.3) million, a decrease of $57.4 million, or 200.3%, compared to $28.7 million for the twelve months ended December 31, 2023.
We maintain three postretirement defined benefit plans for our employees: a noncontributory defined benefit pension plan which was frozen as of September 30, 2006, a contributory medical plan, and a noncontributory life insurance plan.
Our total interest expense and non-interest expense in 2024 were $283.4 million and $163.3 million, respectively. We maintain three postretirement defined benefit plans for our employees: a noncontributory defined benefit pension plan which was frozen as of September 30, 2006, a contributory medical plan, and a noncontributory life insurance plan.
Provision for credit losses was $10.5 million for the year ended December 31, 2023, compared to $5.1 million during the comparable prior year period. The provision recorded in 2023 was driven by fully reserving for two non-accrual business loans and increasing reserves for the elevated risk presented by the current rate environment to adjustable-rate loan’s debt coverage ratios.
The provision recorded in 2023 was driven by fully reserving for two non-accrual commercial business loans and increasing reserves for the elevated risk presented by the current rate environment to adjustable-rate loan’s debt coverage ratios . During the year ended December 31, 2024, non-performing loans increased $8.1 million to $33.3 million from $25.2 million at December 31, 2023.
We monitor goodwill for potential impairment triggers on a quarterly basis. 68 Table of Contents At December 31, 2023, the fair value of the reporting unit exceeded its carrying value by $79.1 million, or 11.8%.
We monitor goodwill for potential impairment triggers on a quarterly basis. At December 31, 2024, the fair value of the reporting unit exceeded its carrying value by $28.7 million, or 4.0%.
The discount rate is a single rate at which the liabilities of the plans are discounted into today’s dollars and could be effectively settled or eliminated.
The APBO is the present value of projected benefits that employees and retirees have earned to date. The discount rate is a single rate at which the liabilities of the plans are discounted into today’s dollars and could be effectively settled or eliminated.
Non-interest expense was $151.4 million for the year ended December 31, 2023, an increase of $7.7 million, or 5.4%, from $143.7 million for the year ended December 31, 2022. The increase in non-interest expense was primarily due to increases in salaries and employee benefits, FDIC insurance premiums and other operating expenses. 64 Table of Contents Income Tax Provisions.
Non-interest expense was $163.3 million for the year ended December 31, 2024, an increase of $9.3 million, or 6.1% from $151.4 million for the year ended December 31, 2023. The increase in non-interest expense was primarily due to increases in salaries and employee benefits related to increased staffing, FDIC insurance premiums and other operating expenses. Income Tax Provision (Benefit).
Return on average equity decreased to 4.25% for the twelve months ended December 31, 2023, from 11.44% for the comparable prior year period. Return on average assets decreased to 0.34% for the twelve months ended December 31, 2023 from 0.93% for the comparable prior year period. 63 Table of Contents Interest Income .
Return on average assets decreased to (0.35%) for the twelve months ended December 31, 2024 from 0.34% for the comparable prior year period. 64 Table of Contents Interest Income . Interest income increased $63.9 million, or 15.9%, to $465.4 million for the year ended December 31, 2024 from $401.5 million for the year ended December 31, 2023.
Interest Expense . Interest expense increased $149.3 million, or 204.5%, to $222.3 million for the year ended December 31, 2023 from $73.0 million for the year ended December 31, 2022.
Interest Expense . Interest expense increased $61.0 million, or 27.4% to $283.4 million for the year ended December 31, 2024 from $222.3 million for the year ended December 31, 2023.
Diluted earnings per common share were $0.96 for the twelve months ended December 31, 2023, a decrease of $1.54 per common share, or 61.6%, from $2.50 per common share for the twelve months ended December 31, 2022.
Diluted (loss) earnings per common share was ($1.05) for the twelve months ended December 31, 2024, a decrease of $2.01 per common share, or 209.4%, from $0.96 per common share for the twelve months ended December 31, 2023.
Income tax expense for the year ended December 31, 2023 decreased $16.7 million, or 60.0%, to $11.2 million, compared to $27.9 million for the year ended December 31, 2022. The decrease was primarily due to the decline in income before income taxes.
Income tax expense for the year ended December 31, 2024 decreased $28.1 million, or 251.6% to a benefit of ($16.9) million, compared to $11.2 million for the year ended December 31, 2023. The decrease was primarily due to the decline in income before income taxes relating to the restructuring transaction.
The Company manages the mix of interest-earning assets and interest-bearing liabilities on a continuous basis to maximize return and adjust its exposure to interest rate risk. 60 Table of Contents The starting point for the net interest income simulation is an estimate of the next twelve months’ net interest income assuming that both interest rates and the Company’s interest-sensitive assets and liabilities remain at period-end levels.
The starting point for the net interest income simulation is an estimate of the next twelve months’ net interest income assuming that both interest rates and the Company’s interest-sensitive assets and liabilities remain at period-end levels.
The 96 basis point increase in the yield of interest-earning assets was primarily due to increases of 84 basis points, 176 basis points and 272 basis points in the yield of total loan, net, total securities and interest-earning deposits and federal funds sold, respectively. These rate increases were all driven by the rising interest rate environment experienced in 2023.
The 49 basis point increase in the yield of interest-earning assets was primarily due to increases of 36 basis points, 152 basis points and 28 basis points in the yield of total loan, net, total securities and interest-earning deposits and federal funds sold, respectively.
The decrease in the net interest margin for 2023 was primarily due to an increase in our funding costs, partially offset by an increase in the yield of our interest-earning assets.
The decrease in the net interest margin for 2024 was primarily due to an increase in our funding costs, partially offset by an increase in the yield of our interest-earning assets. During 2024, the cost of interest-bearing liabilities increased 62 basis points to 3.91% from 3.29% for the prior year.
Of the $775.8 million outstanding at December 31, 2023, $50.0 million at an average rate of 1.25% will mature in April 2024 and will be replaced by forward starting swaps totaling $50.0 million at an average rate of 0.80%. ​ 61 Table of Contents Analysis of Net Interest Income (Loss) Net interest income represents the difference between income on interest-earning assets and expense on interest-bearing liabilities.
Of the $950.8 million outstanding at December 31, 2024, $225.0 million at an average rate of 0.67% will mature during the second quarter of 2025, and will be partially replaced by forward starting cash flow hedges totaling $75.0 million at an average rate of 3.01%. 62 Table of Contents Analysis of Net Interest Income Net interest income represents the difference between income on interest-earning assets and expense on interest-bearing liabilities.
The changes attributable to the combined impact of volume and rate have been allocated proportionately to the changes due to volume and the changes due to rate. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Increase (Decrease) in Net Interest Income (Loss) for the years ended December 31, ​ ​ 2023 vs. 2022 ​ 2022 vs. 2021 ​ ​ Due to ​ ​ ​ ​ Due to ​ ​ ​ ​ Volume Rate Net Volume Rate Net ​ ​ (Dollars in thousands) Interest-Earning Assets: ​ ​ ​ ​ ​ ​ Mortgage loans, net ​ $ 3,309 ​ $ 35,804 ​ $ 39,113 ​ $ 4,656 ​ $ 5,829 ​ $ 10,485 Other loans, net ​ 1,283 ​ 21,665 ​ 22,948 ​ (365) ​ 8,836 ​ 8,471 Mortgage-backed securities ​ (2,505) ​ 4,596 ​ 2,091 ​ 375 ​ 704 ​ 1,079 Other securities ​ 6,243 ​ 8,686 ​ 14,929 ​ 1,770 ​ 4,000 ​ 5,770 Tax-Exempt securities ​ ​ 57 ​ ​ (331) ​ ​ (274) ​ ​ 520 ​ ​ (465) ​ ​ 55 Interest-earning deposits and federal funds sold ​ 1,270 ​ 4,717 ​ 5,987 ​ (80) ​ 2,295 ​ 2,215 Total interest-earning assets ​ 9,657 ​ 75,137 ​ 84,794 ​ 6,876 ​ 21,199 ​ 28,075 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Interest-Bearing Liabilities: ​ ​ ​ ​ ​ ​ Deposits: ​ ​ ​ ​ ​ ​ Savings accounts ​ (54) ​ 363 ​ 309 ​ (7) ​ (37) ​ (44) NOW accounts ​ (303) ​ 49,141 ​ 48,838 ​ (518) ​ 10,418 ​ 9,900 Money market accounts ​ (4,519) ​ 44,378 ​ 39,859 ​ 488 ​ 11,280 ​ 11,768 Certificate of deposit accounts ​ 20,936 ​ 31,361 ​ 52,297 ​ (15) ​ 5,222 ​ 5,207 Mortgagors' escrow accounts ​ 2 ​ 65 ​ 67 ​ — ​ 130 ​ 130 Borrowings ​ (7,056) ​ 15,001 ​ 7,945 ​ 2,559 ​ 2,897 ​ 5,456 Total interest-bearing liabilities ​ 9,006 ​ 140,309 ​ 149,315 ​ 2,507 ​ 29,910 ​ 32,417 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net change in net interest income (loss) ​ $ 651 ​ $ (65,172) ​ $ (64,521) ​ $ 4,369 ​ $ (8,711) ​ $ (4,342) ​ Comparison of Operating Results for the Years Ended December 31, 2023 and 2022 General .
The changes attributable to the combined impact of volume and rate have been allocated proportionately to the changes due to volume and the changes due to rate. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Increase (Decrease) in Net Interest Income for the years ended December 31, ​ ​ 2024 vs. 2023 ​ 2023 vs. 2022 ​ ​ Due to ​ ​ ​ ​ Due to ​ ​ ​ ​ Volume Rate Net Volume Rate Net ​ ​ (Dollars in thousands) Interest-Earning Assets: ​ ​ ​ ​ ​ ​ Loans held for sale ​ $ — ​ $ 7 ​ $ 7 ​ $ — ​ $ — ​ $ — Mortgage loans, net ​ ​ 942 ​ ​ 23,317 ​ ​ 24,259 ​ ​ 3,309 ​ ​ 35,804 ​ ​ 39,113 Other loans, net ​ (5,687) ​ 1,651 ​ (4,036) ​ 1,283 ​ 21,665 ​ 22,948 Mortgage-backed securities ​ 11,759 ​ 14,221 ​ 25,980 ​ (2,505) ​ 4,596 ​ 2,091 Other securities ​ 9,782 ​ 5,748 ​ 15,530 ​ 6,243 ​ 8,686 ​ 14,929 Tax-Exempt securities ​ ​ (36) ​ ​ — ​ ​ (36) ​ ​ 57 ​ ​ (331) ​ ​ (274) Interest-earning deposits and federal funds sold ​ 1,632 ​ 541 ​ 2,173 ​ 1,270 ​ 4,717 ​ 5,987 Total interest-earning assets ​ 18,392 ​ 45,485 ​ 63,877 ​ 9,657 ​ 75,137 ​ 84,794 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Interest-Bearing Liabilities: ​ ​ ​ ​ ​ ​ Deposits: ​ ​ ​ ​ ​ ​ Savings accounts ​ (82) ​ 34 ​ (48) ​ (54) ​ 363 ​ 309 NOW accounts ​ 929 ​ 10,563 ​ 11,492 ​ (303) ​ 49,141 ​ 48,838 Money market accounts ​ (1,864) ​ 10,958 ​ 9,094 ​ (4,519) ​ 44,378 ​ 39,859 Certificates of deposit accounts ​ 17,818 ​ 17,573 ​ 35,391 ​ 20,936 ​ 31,361 ​ 52,297 Mortgagors' escrow accounts ​ 3 ​ 49 ​ 52 ​ 2 ​ 65 ​ 67 Borrowings ​ 854 ​ 4,191 ​ 5,045 ​ (7,056) ​ 15,001 ​ 7,945 Total interest-bearing liabilities ​ 17,658 ​ 43,368 ​ 61,026 ​ 9,006 ​ 140,309 ​ 149,315 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net change in net interest income ​ $ 734 ​ $ 2,117 ​ $ 2,851 ​ $ 651 ​ $ (65,172) ​ $ (64,521) ​ Comparison of Operating Results for the Years Ended December 31, 2024 and 2023 General .
Call provisions associated with our investments in U.S. government agency and corporate securities may also adversely affect yield in a declining interest rate environment. Such prepayments and calls may adversely affect the yield of our loan portfolio and mortgage-backed and other securities as we reinvest the prepaid funds in a lower interest rate environment.
Prevailing interest rates affect the extent to which borrowers repay and refinance loans. In a declining interest rate environment, the number of loan prepayments and loan refinancing tends to increase, as do prepayments of mortgage-backed securities. Call provisions associated with our investments in U.S. government agency and corporate securities may also adversely affect yield in a declining interest rate environment.
Net interest income for the year ended December 31, 2023 totaled $179.2 million, a decrease of $64.5 million, or 26.5%, from $243.6 million for the year ended December 31, 2022.
Net Interest Income. Net interest income for the year ended December 31, 2024 totaled $182.0 million, an increase of $2.9 million, or 1.6% from $179.2 million for the year ended December 31, 2023.
At December 31, 2023, we had borrowings obligations of $841.3 million of which $318.6 million represents our current obligations within one year, including borrowing callable within one year.
At December 31, 2024, we had borrowings obligations of $916.1 million of which $543.8 million represents our current obligations within one year, including borrowing callable within one year. At December 31, 2024, we had deposit obligations of $7,178.9 million of which $7,051.4 million represents our current obligations within one year.
While we primarily rely on originating our own loans, we purchased $166.3 million, $275.7 million, and $262.1 million during the years ended December 31, 2023, 2022, and 2021, respectively. We purchase loans when the loans complement our loan portfolio strategy. Loans purchased must meet our underwriting standards when they were originated.
Loan originations and purchases were $698.2 million, $818.1 million, and $1,521.9 million for the years ended December 31, 2024, 2023, and 2022, respectively. While we primarily rely on originating our own loans, we purchased $173.5 million, $166.3 million, and $275.7 million during the years ended December 31, 2024, 2023, and 2022, respectively.
During the three-year period ended December 31, 2023, the allocation of our loan portfolio has remained fairly consistent. The majority of our loans are collateralized by real estate, which comprised 88.9% of our gross loan portfolio at December 31, 2023 compared to 88.3% at December 31, 2022 and 87.8% at December 31, 2021.
The majority of our loans are collateralized by real estate, which comprised 90.0% of our gross loan portfolio at December 31, 2024 compared to 88.9% at December 31, 2023 and 88.3% at December 31, 2022. Due to depositors increased $361.0 million, $327.7 million, and $103.7 million during the years ended December 31, 2024, 2023, and 2022, respectively.
However, we typically receive additional loan fees when existing loans are refinanced, which partially offsets the reduced yield on our loan portfolio resulting from prepayments.
Such prepayments and calls may adversely affect the yield of our loan portfolio and mortgage-backed and other securities as we reinvest the prepaid funds in a lower interest rate environment. However, we typically receive additional loan fees when existing loans are refinanced, which partially offsets the reduced yield on our loan portfolio resulting from prepayments.
Due to depositors increased $327.7 million, $103.7 million, and $242.8 million in 2023, 2022, and 2021, respectively. The deposit mix is significantly influenced by the current interest rate environment. Brokered deposits represented 16.2%, 13.2%, and 9.8% of total deposits at December 31, 2023, 2022, and 2021, respectively.
The deposit mix is significantly influenced by the current interest rate environment. Brokered deposits represented 18.4%, 16.2%, and 13.2% of total deposits at December 31, 2024, 2023, and 2022, 59 Table of Contents respectively. At December 31, 2024, 2023, and 2022, reciprocal deposits totaled $753.2 million, $760.3 million, and $659.5 million, respectively.
Our most liquid assets are cash and cash equivalents, which include cash and due from banks, overnight interest-earning deposits and federal funds sold with original maturities of 90 days or less. The level of these assets is dependent on our operating, financing, lending and investing activities during any given period.
Additionally, $65.5 million in funds (net of expenses), were provided by the issuance of 4.3 million shares of common stock during 2024. Our most liquid assets are cash and cash equivalents, which include cash and due from banks, overnight interest-earning deposits and federal funds sold with original maturities of 90 days or less.
At December 31, 2023, cash and cash equivalents totaled $172.2 million, an increase of $20.4 million from December 31, 2022. We also held marketable securities available for sale with a market value of $874.8 million at December 31, 2023. A portion of our cash and cash equivalents is restricted cash held as collateral for interest rate swaps.
A portion of our cash and cash equivalents is restricted cash held as collateral for interest rate swaps, totaled $43.2 million and $47.9 million, at December 31, 2024 and 2023, respectively.
We currently provide a non-qualified deferred compensation plan for officers who have achieved the designated level and completed one year of service. However, certain officers who have not reached the designated level but were already participants remain eligible to participate in the Plan.
However, certain officers who have not reached the designated level but were already participants remain eligible to participate in the Plan. In addition to the amounts deferred by the officers, we match 50% of their contributions, generally up to a maximum of 5% of the officer’s salary.
Non-interest income for the twelve months ended December 31, 2023 was $22.6 million, an increase of $12.6 million, or 126.0%, from $10.0 million for the twelve months ended December 31, 2022. Non-interest income increased primarily due to the Company deciding to sell low yielding securities recognizing a loss of $10.9 million in 2022. Non-Interest Expense .
Non-interest (loss) income for the twelve months ended December 31, 2024 was ($57.4) million, a decrease of $80.0 million, or 354.3% from $22.6 million for the twelve months ended December 31, 2023. Non-interest income decreased primarily due to the sale of securities associated with the restructuring transaction. Non-Interest Expense .
At December 31, 2023 and 2022, restricted cash totaled $47.9 million and $67.0 million, respectively. At December 31, 2023 and 2022, cash (including restricted cash) held in excess of Federal Deposit Insurance Corporation (“FDIC”) deposit insurance limits at other commercial banks totaling $61.2 million, and $73.9 million, respectively.
At December 31, 2024 and 2023, cash (including 66 Table of Contents restricted cash) held in excess of FDIC deposit insurance limits at other commercial banks totaling $62.4 million, and $61.2 million, respectively. At December 31, 2024, we had commitments to extend credit totaling $409.5 million.
These scenarios have assumptions including loan originations, investment securities purchases and sales, prepayment rates on loans and investment securities, deposit flows, and mix and pricing decisions. Economic Value of Equity Analysis .
These scenarios have assumptions including loan originations, investment securities purchases and sales, prepayment rates on loans and investment securities, deposit flows, and mix and pricing decisions. Asset/Liability Management. Asset/liability management involves assessing, monitoring and managing interest rate risk. The Asset Liability Investment Committee of the Board of Directors (“Board ALCO”) has primary oversight responsibility of interest rate risk.
In addition to the amounts deferred by the officers, we match 50% of their contributions, generally up to a maximum of 5% of the officer’s salary. These plans generally require the deferred balance to be credited with earnings at a rate earned by certain mutual funds. At December 31, 2023, we had deferred compensation plan obligations of $23.3 million.
These plans generally require the deferred balance to be credited with earnings at a rate earned by certain mutual funds. At December 31, 2024, we had deferred compensation plan obligations of $25.2 million. This expense is provided in the Consolidated Statements of Operations, and the liability has been provided in the Consolidated Statements of Financial Condition. Regulatory Capital Position.
We believe that this is the most cost effective method for obtaining these services. These arrangements are usually volume dependent and have varying terms. The contracts for these services usually include annual increases based on the increase in the consumer price index. At December 31, 2023, we had operating lease and purchasing obligations totaling $57.6 million.
At December 31, 2023, the Bank had 28 branches, which were all leased. In addition, we lease our executive offices. We currently outsource our data processing, loan servicing and check processing functions. We believe that this is the most cost effective method for obtaining these services. These arrangements are usually volume dependent and have varying terms.
The following table presents the Company’s interest rate shock as of December 31: ​ ​ ​ ​ ​ ​ ​ ​ ​ Projected Percentage Change In Net Interest Income Change in Interest Rate ​ 2023 ​ 2022 -200 Basis points ​ (0.41) % ​ 5.73 % -100 Basis points ​ (0.07) ​ ​ 3.64 ​ Base interest rate ​ - ​ ​ - ​ +100 Basis points ​ (2.62) ​ ​ (7.31) ​ +200 Basis points ​ (5.42) ​ ​ (14.61) ​ ​ During 2023, the Company strategically reduced its liability sensitive interest rate position by becoming more interest rate neutral.
At December 31, 2024, the Company was within the guidelines set forth by the Board of Directors for each interest rate level. 61 Table of Contents The following table presents the Company’s interest rate shock as of December 31: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Projected Percentage Change In ​ ​ ​ ​ ​ ​ ​ Net Portfolio Value (NPV) ​ Net Portfolio Value Ratio ​ ​ December 31, ​ ​ December 31, ​ ​ December 31, ​ ​ December 31, ​ Change in Interest Rate ​ 2024 ​ ​ 2023 ​ ​ 2024 ​ ​ 2023 ​ -200 Basis points ​ 2.9 % ​ (1.8) % ​ 9.0 % ​ 7.4 % -100 Basis points ​ 1.2 ​ ​ (0.9) ​ ​ 9.0 ​ ​ 7.6 ​ Base interest rate ​ - ​ ​ - ​ ​ 9.0 ​ 7.8 +100 Basis points ​ (5.0) ​ ​ (3.5) ​ ​ 8.7 ​ 7.7 +200 Basis points ​ (10.9) ​ ​ (6.7) ​ ​ 8.3 ​ 7.6 ​ Income Simulation Analysis.
Net interest income decreased $64.5 million or 26.5% to $179.2 million for the twelve months ended December 31, 2023 from $243.6 million for the prior year, primarily due to a decrease of 87 basis points in the net interest margin to 2.24% for the twelve months ended December 31, 2023.
Net interest income increased $2.9 million or 1.6% to $182.0 million for the twelve months ended December 31, 2024 from $179.2 million for the prior year, driven by an increase of $449.0 million in the average balance of interest-earning assets, partially offset by the net interest margin declining nine basis points to 2.15% during the same period.
The Company has other sources of liquidity, including unsecured overnight lines of credit, brokered deposits and other types of borrowings. Liquidity management is both a short and long-term function of business management. During 2023, funds were provided by the Company’s operating and financing activities, which were used to fund our investing activities.
During 2024, funds were provided by the Company’s operating and financing activities, which were used to fund our investing activities.
Because of this strategy, we were able to continue to achieve a higher yield on our mortgage portfolio than we would have otherwise experienced . ​ Loan originations and purchases were $818.1 million, $1,521.9 million, and $1,254.0 million for the years ended December 31, 2023, 2022, and 2021, respectively.
Because of this strategy, we were able to continue to achieve a higher yield on our mortgage portfolio than we would have otherwise experienced . ​ During 2024, loan demand was below expectations and put the earnings at risk. Management, therefore, executed on a leverage strategy purchasing $944.8 million of securities with an average yield of 6.69%.
These reports quantify the potential changes in net interest income and net portfolio value through various interest rate scenarios. The ALCO committee of the Board of Directors has established limits for changes in interest rates both economic value of equity and income simulation analysis. Compliance with the limits is reviewed quarterly.
Management ALCO, which consists of representatives from treasury, finance, business units, and senior management, oversees the interest rate risk, liquidity risk and capital risk while providing regular reports to the Board ALCO. These reports quantify the potential changes in net interest income and economic value of equity through various rate scenarios.
There can be no assurance that we will be able to effectively implement this strategy. Our strategy is subject to change by the Board of Directors. Manage cost of funds and continue to improve funding mix. We have a relatively stable retail deposit base drawn from our market area through our full-service offices.
To achieve this objective, we intend to: ● increase net interest margin and reduce volatility; 57 Table of Contents ● maintain credit discipline; ● preserve strong liquidity and capital; ● bend the expense curve; There can be no assurance that we will be able to effectively implement this strategy. Our strategy is subject to change by the Board of Directors.
The decrease in net interest income was primarily due to a decrease of 120 basis points in the net interest spread to 1.72% for the twelve months ended December 31, 2023 from 2.92% for the comparable prior year period.
The increase in net interest income was driven by an increase of $449.0 million in the average balance of interest-earning assets, partially offset by the net interest margin declining nine basis points to 2.15% for the year ended December 31, 2024 compared to the prior year period.
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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeManagement’s Discussion and Analysis of Financial Condition and Results of Operations and in Notes 19 (“Fair Value of Financial Instruments”) and 20 (“Derivative Financial Instruments”) of the Notes to Consolidated Financial Statements in Item 8 of this Annual Report. 69 Table of Contents
Biggest changeManagement’s Discussion and Analysis of Financial Condition and Results of Operations and in Notes 19 (“Fair Value of Financial Instruments”) and 20 (“Derivative Financial Instruments”) of the Notes to Consolidated Financial Statements in Item 8 of this Annual Report. 70 Table of Contents

Other FFIC 10-K year-over-year comparisons