PDL Community Bancorp

01/30/2024 | Press release | Distributed by Public on 01/30/2024 15:47

Ponce Financial Group, Inc. Reports Fourth Quarter 2023 Results - Form 8-K

Ponce Financial Group, Inc. Reports Fourth Quarter 2023 Results

NEW YORK, January 30, 2024 - Ponce Financial Group, Inc., (the "Company") (NASDAQ: PDLB), the holding company for Ponce Bank (the "Bank"), today announced results for the fourth quarter of 2023.

Fourth Quarter 2023 Highlights (Compared to Prior Periods):

•
Net income of $0.5 million, or $0.02 per diluted share for the three months ended December 31, 2023, as compared to net income of $2.6 million, or $0.12 per diluted share for the three months ended September 30, 2023 and net loss of ($9.2) million, or ($0.40) per diluted share for the three months ended December 31, 2022.
•
Included in the $0.5 million of net income for the fourth quarter of 2023 results is $35.0 million in interest and dividend income and $1.3 million in non-interest income, offset by $17.9 million in non-interest expense and $17.8 million in interest expense.
•
Net interest income of $17.2 million for the fourth quarter of 2023 increased $0.7 million, or 3.96%, from the prior quarter and increased $1.0 million, or 6.38%, from the same quarter last year.
•
Net interest margin was 2.66% for the fourth quarter of 2023, increased from 2.58% for the prior quarter and decreased from 2.97% for the same quarter last year.

Full Year 2023 Highlights (Compared to 2022):

•
Net income of $3.4 million, or $0.15 per diluted share for the year ended December 31, 2023, as compared to a net loss of ($30.0) million, or ($1.32) per diluted share for the year ended December 31, 2022.
•
Net interest income for the year ended December 31, 2023 was $65.3 million, decreased $1.3 million, or 2.01%, compared to $66.6 million for the year ended December 31, 2022.
•
Non-interest income for the year ended December 31, 2023 was $10.2 million, increased $3.8 million, or 59.26%, compared to $6.4 million for the year ended December 31, 2022.
•
Non-interest expense for the year ended December 31, 2023 was $68.7 million, decreased $17.2 million, or 19.99%, compared to $85.8 million for the year ended December 31, 2022.
•
Net interest margin was 2.66% for the year ended December 31, 2023, decreased from 3.66% for the same period last year.
•
Cash and equivalents were $139.2 million as of December 31, 2023, increased $84.8 million, or 156.05%, from December 31, 2022, as we decided to keep ample sources of liquidity at hand while taking advantage of the positive spread between our interest bearing overnight deposits at the Fed and borrowing costs under the Bank Term Funding Program ("BTFP").
•
Securities totaled $581.7 million as of December 31, 2023, decreased $58.7 million, or 9.16%, from December 31, 2022 primarily due to a call on one of the securities amounting to $10.0 million and regular principal payments.
•
Net loans receivable were $1.90 billion as of December 31, 2023, increased $402.8 million, or 26.97%, from December 31, 2022.
•
Deposits were $1.51 billion as of December 31, 2023, increased $255.2 million, or 20.38%, from December 31, 2022.

President and Chief Executive Officer's Comments

Carlos P. Naudon, Ponce Financial Group's President and CEO, stated "We were pleased to see continued improvement during the quarter: Net interest income grew for the third quarter in a row and, despite the challenging operating environment, net interest income was also up quarter over quarter. Book value per share was $11.20 at year-end, up $0.21 quarter over quarter and up $0.43 versus last year. Total equity per share now stands at $20.66. Additionally, in order to better manage our interest risk, during the fourth quarter, we entered into two pay fixed, receiver SOFR swaps, one with notional amount of $150 million for 2 years and one with notional amount of $100 million for 3 years.

1

We continue to show strong levels of capital and liquidity. On the capital front, our total capital ratio at Ponce Bank stands at 23.30%, well in excess of regulatory requirements. In terms of liquidity, our liquid assets plus borrowing capacity at the Federal Home Loan Bank of New York ("FHLBNY") stands at $778.8 million, two times of our uninsured deposits of $389.4 million.

We remain committed to the communities we serve, our Minority Depository Institution ("MDI")/Community Development Financial Institutions ("CDFI") status and continuing to invest in our people and in technology to improve our efficiency".

Executive Chairman's Comment

Steven A. Tsavaris, Ponce Financial Group's Executive Chairman added "We were able to grow both loans and deposits by over $100 million this quarter. We continue to see resiliency of our client base, but we'll prioritize sound underwriting practices and balance sheet management even at the expense of loan growth."

Selected performance metrics are as follows (refer to "Key Metrics" for additional information):

At or for the Three Months Ended

December 31,

September 30,

June 30,

March 31,

December 31,

Performance Ratios (Annualized):

2023

2023

2023

2023

2022

Return on average assets (1)

0.08

%

0.39

%

(0.01

%)

0.06

%

(1.62

%)

Return on average equity (1)

0.42

%

2.11

%

(0.07

%)

0.27

%

(7.28

%)

Net interest rate spread (1) (2)

1.63

%

1.58

%

1.66

%

1.78

%

2.13

%

Net interest margin (1) (3)

2.66

%

2.58

%

2.65

%

2.75

%

2.97

%

Non-interest expense to average assets (1)

2.66

%

2.58

%

2.65

%

2.79

%

2.78

%

Efficiency ratio (4)

96.83

%

78.11

%

96.15

%

95.88

%

94.95

%

Average interest-earning assets to average interest- bearing liabilities

137.49

%

137.92

%

141.14

%

148.20

%

152.30

%

Average equity to average assets

18.25

%

18.32

%

19.21

%

20.91

%

22.32

%

At or for the Three Months Ended

December 31,

September 30,

June 30,

March 31,

December 31,

Capital Ratios (Annualized):

2023

2023

2023

2023

2022

Total capital to risk weighted assets (Bank only)

23.30

%

25.10

%

26.30

%

27.54

%

30.53

%

Tier 1 capital to risk weighted assets (Bank only)

22.05

%

23.85

%

25.05

%

26.28

%

29.26

%

Common equity Tier 1 capital to risk-weighted assets (Bank only)

22.05

%

23.85

%

25.05

%

26.28

%

29.26

%

Tier 1 capital to average assets (Bank only)

17.49

%

17.51

%

17.95

%

19.51

%

20.47

%

At or for the Three Months Ended

December 31,

September 30,

June 30,

March 31,

December 31,

Asset Quality Ratios (Annualized):

2023

2023

2023

2023

2022

Allowance for loan losses as a percentage of total loans

1.36

%

1.51

%

1.64

%

1.77

%

2.27

%

Allowance for loan losses as a percentage of nonperforming loans

152.99

%

169.49

%

167.06

%

149.73

%

252.33

%

Net (charge-offs) recoveries to average outstanding loans (1)

(0.24

%)

(0.34

%)

(0.41

%)

(0.57

%)

(0.85

%)

Non-performing loans as a percentage of total gross loans

0.89

%

0.89

%

0.98

%

1.18

%

0.90

%

Non-performing loans as a percentage of total assets

0.62

%

0.62

%

0.63

%

0.76

%

0.59

%

Total non-performing assets as a percentage of total assets

0.62

%

0.62

%

0.63

%

0.76

%

0.59

%

Total non-performing assets and accruing modifications to borrowers experiencing financial difficulty as a percentage of total assets (5)

0.81

%

0.82

%

0.83

%

0.93

%

0.78

%

(1)
Annualized where appropriate.
(2)
Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average rate of interest-bearing liabilities.
(3)
Net interest margin represents net interest income divided by average total interest-earning assets.
(4)
Efficiency ratio represents noninterest expense divided by the sum of net interest income and noninterest income.
(5)
For periods in 2023, balances include both modifications to borrowers experiencing financial difficulty, in accordance with ASU 2022-02 adopted on January 1, 2023, and previously existing troubled debt restructurings. For the period in 2022, the balances only include troubled debt restructurings.

2

Summary of Results of Operations

Net income for the three months ended December 31, 2023 was $0.5 million compared to net income of $2.6 million for the three months ended September 30, 2023 and a net loss of ($9.2) million for the three months ended December 31, 2022. The decrease of net income for the three months ended December 31, 2023 compared to the three months ended September 30, 2023 was attributed mainly to a decrease in non-interest income and an increase in non-interest expense, partially offset by a decrease in provision for income taxes and, increases in a benefit for credit losses and net interest income. The increase of net income for the three months ended December 31, 2023 compared to the three months ended December 31, 2022 was largely due to increases in benefit for credit losses, net interest income and non-interest income, partially offset by increases in provision for income taxes and non-interest expense.

Net income for the year ended December 31, 2023 was $3.4 million compared to a net loss of ($30.0) million for the year ended December 31, 2022. The increase in net income was attributable to an increase in benefit for credit losses and a decrease in non-interest expense and an increase in non-interest income, partially offset by an increase in provision for income taxes and a decrease in net interest income.

Net Interest Income and Net Margin

Net interest income for the three months ended December 31, 2023, increased $0.7 million, or 3.96%, to $17.2 million compared to $16.5 million for the three months ended September 30, 2023 and increased $1.0 million, or 6.38%, compared to $16.2 million for the three months ended December 31, 2022.

Net interest margin was 2.66% for the three months ended December 31, 2023 compared to 2.58% for the prior quarter, an increase of 8bps and 2.97% for the same period last year, a decrease of 31bps. The decrease in net interest margin for the three months ended December 31, 2023 when compared to the same period last year was a result of an increase in the cost of funds driven by higher interest rates.

Non-interest Income

Non-interest income for the three months ended December 31, 2023, was $1.3 million, a decrease of $4.3 million, or 77.16%, compared to the three months ended September 30, 2023 and an increase of $0.8 million, or 194.05%, compared to the three months ended December 31, 2022.

The $4.3 million decrease in non-interest income for the three months ended December 31, 2023 compared to the three months ended September 30, 2023 was largely attributable to a grant of $3.7 million received in the third quarter of 2023 from the U.S. Treasury, partially offset by a smaller grant of $0.4 million received in the fourth quarter of 2023 from the U.S. Treasury. The decrease in non-interest income was also impacted by decreases of $0.6 million in other non-interest income and $0.5 million in late and prepayment charges.

Non-interest income for the year ended December 31, 2023, was $10.2 million, an increase of $3.8 million, or 59.26%, compared to $6.4 million for the year ended December 31, 2022. The $3.8 million increase from the year ended December 31, 2022 was attributable to two grants totaled $4.2 million received from the U.S. Treasury and an increase of $1.7 million in late and prepayment charges, partially offset by decreases of $1.3 million in loan origination and $0.9 million in brokerage commission.

Non-interest Expense

Non-interest expense for the three months ended December 31, 2023, was $17.9 million, an increase of $0.6 million, or 3.36%, compared to $17.3 million for the three months ended September 30, 2023 and an increase of $2.1 million, or 13.52%, compared to $15.8 million for the three months ended December 31, 2022.

The $2.1 million increase from the three months ended December 31, 2022 was mainly attributable to increases of $1.8 million in compensation and benefits, $0.9 million in provision for contingencies and $0.5 million in professional fees, partially offset by a decrease of $0.9 million in other operating expense.

Non-interest expense for the year ended December 31, 2023 was $68.7 million, a decrease of $17.2 million, or 19.99%, compared to $85.8 million for the year ended December 31, 2022. The $17.2 million decrease of non-interest expense from the year ended December 31, 2022 was attributable to $17.9 million Grain consumer microloan write-off during 2022 compared with $1.5 million of Grain consumer microloan recoveries recognized during the current period. The decrease in non-interest expense was also impacted by

3

a $5.0 million contribution to the Ponce De Leon Foundation during 2022, partially offset by increases of $2.8 million in compensation and benefits, $2.2 million in provision for contingencies, $1.3 million in data processing expenses and $1.2 million in professional fees.

Balance Sheet Summary

Total assets increased $438.7 million, or 18.98%, to $2.75 billion as of December 31, 2023 from $2.31 billion as of December 31, 2022. The increase in total assets is largely attributable to increases of $402.8 million in net loans receivable, $84.8 million in cash and cash equivalents, $10.7 million in other assets and $8.0 million in mortgage loans held for sale, partially offset by decreases of $49.1 million in held-to-maturity securities, $9.6 million in available-for-sale securities and $5.3 million in Federal Home Loan Bank of New York stock.

Total liabilities increased $440.0 million, or 24.19%, to $2.26 billion as of December 31, 2023 from $1.82 billion as of December 31, 2022. The increase in total liabilities was largely attributable to increases of $255.2 million in deposits, $167.0 million in borrowings, $10.6 million in accrued interest payable and $8.0 million in other liabilities.

Total stockholders' equity decreased $1.3 million, or 0.26%, to $491.4 million as of December 31, 2023, from $492.7 million as of December 31, 2022. This decrease in stockholders' equity was largely attributable to $11.0 million in share repurchases during 2023 and $2.2 million in other comprehensive loss, offset by $3.4 million in net income, $1.9 million impact to additional paid in capital as a result of share-based compensation, $1.1 million as a result of implementation of CECL and $1.1 million from release of ESOP shares.

About Ponce Financial Group, Inc.

Ponce Financial Group, Inc. is the holding company for Ponce Bank. Ponce Bank is a Minority Depository Institution, a Community Development Financial Institution, and a certified Small Business Administration lender. Ponce Bank's business primarily consists of taking deposits from the general public and to a lesser extent alternative funding sources and investing those funds, together with funds generated from operations and borrowings, in mortgage loans, consisting of 1-4 family residences (investor-owned and owner-occupied), multifamily residences, nonresidential properties, construction and land, and, to a lesser extent, in business and consumer loans. Ponce Bank also invests in securities, which consist of U.S. Government and federal agency securities and securities issued by government-sponsored or government-owned enterprises, as well as, mortgage-backed securities, corporate bonds and obligations, and Federal Home Loan Bank stock.

Forward Looking Statements

Certain statements herein constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements may be identified by words such as "believes," "will," "would," "expects," "project," "may," "could," "developments," "strategic," "launching," "opportunities," "anticipates," "estimates," "intends," "plans," "targets" and similar expressions. These statements are based upon the current beliefs and expectations of management and are subject to significant risks and uncertainties. Actual results may differ materially from those set forth in the forward-looking statements as a result of numerous factors. Factors that could cause such differences to exist include, but are not limited to, adverse conditions in the capital and debt markets and the impact of such conditions on business activities; changes in interest rates; competitive pressures from other financial institutions; the effects of general economic conditions on a national basis or in the local markets in which Ponce Bank operates, including changes that adversely affect borrowers' ability to service and repay Ponce Bank's loans; anticipated losses with respect to the Company's investment in Grain; changes in the value of securities in the investment portfolio; changes in loan default and charge-off rates; fluctuations in real estate values; the adequacy of loan loss reserves; decreases in deposit levels necessitating increased borrowing to fund loans and investments; operational risks including, but not limited to, cybersecurity, fraud and natural disasters; changes in government regulation; changes in accounting standards and practices; the risk that intangibles recorded in the financial statements will become impaired; demand for loans in Ponce Bank's market area; Ponce Bank's ability to attract and maintain deposits; risks related to the implementation of acquisitions, dispositions, and restructurings; the risk that Ponce Financial Group, Inc. may not be successful in the implementation of its business strategy; changes in assumptions used in making such forward-looking statements and the risk factors described in Ponce Financial Group, Inc.'s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q as filed with the Securities and Exchange Commission (the "SEC"), which are available at the SEC's website, www.sec.gov. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. Ponce Financial Group, Inc. disclaims any obligation to publicly update or revise any forward-looking statements to reflect changes in underlying assumptions or factors, new information, future events or other changes, except as may be required by applicable law or regulation.

4

Ponce Financial Group, Inc.and Subsidiaries

Consolidated Statements of Financial Condition

(Dollars in thousands, except for share data)

As of

December 31,

September 30,

June 30,

March 31,

December 31,

2023

2023

2023

2023

2022

ASSETS

Cash and due from banks:

Cash

$

28,930

$

26,046

$

31,162

$

26,951

$

31,977

Interest-bearing deposits

110,260

90,966

212,627

157,736

22,383

Total cash and cash equivalents

139,190

117,012

243,789

184,687

54,360

Available-for-sale securities, at fair value

119,902

116,753

123,720

128,320

129,505

Held-to-maturity securities, at amortized cost (1)

461,748

471,065

481,952

491,649

510,820

Placement with banks

249

996

996

1,245

1,494

Mortgage loans held for sale, at fair value

9,980

14,103

10,070

2,987

1,979

Loans receivable, net

1,895,886

1,787,607

1,695,047

1,614,428

1,493,127

Accrued interest receivable

18,010

16,624

16,054

15,435

15,049

Premises and equipment, net

16,053

16,453

16,856

17,215

17,446

Right of use assets

31,272

32,110

32,435

33,147

33,423

Federal Home Loan Bank of New York stock (FHLBNY), at cost

19,377

18,870

19,195

19,209

24,661

Deferred tax assets

14,332

15,984

15,924

15,413

16,137

Other assets

24,723

16,286

15,919

15,799

13,988

Total assets

$

2,750,722

$

2,623,863

$

2,671,957

$

2,539,534

$

2,311,989

LIABILITIES AND STOCKHOLDERS' EQUITY

Liabilities:

Deposits

$

1,507,620

$

1,401,132

$

1,442,013

$

1,336,877

$

1,252,412

Operating lease liabilities

32,684

33,459

33,716

34,308

34,532

Accrued interest payable

11,965

8,385

4,704

1,767

1,390

Advance payments by borrowers for taxes and insurance

10,778

13,743

12,402

14,902

9,724

Borrowings

684,421

675,100

682,100

648,375

517,375

Other liabilities

11,859

6,986

6,540

7,264

3,856

Total liabilities

2,259,327

2,138,805

2,181,475

2,043,493

1,819,289

Commitments and contingencies

Stockholders' Equity:

Preferred stock, $0.01 par value; 100,000,000 shares authorized

225,000

225,000

225,000

225,000

225,000

Common stock, $0.01 par value; 200,000,000 shares authorized

249

249

249

249

249

Treasury stock, at cost

(9,747

)

(10,975

)

(5,202

)

(2

)

(2

)

Additional paid-in-capital

207,106

207,626

207,287

206,883

206,508

Retained earnings

97,420

96,902

94,312

94,399

92,955

Accumulated other comprehensive loss

(15,649

)

(20,468

)

(17,597

)

(16,629

)

(17,860

)

Unearned compensation ─ ESOP

(12,984

)

(13,276

)

(13,567

)

(13,859

)

(14,150

)

Total stockholders' equity

491,395

485,058

490,482

496,041

492,700

Total liabilities and stockholders' equity

$

2,750,722

$

2,623,863

$

2,671,957

$

2,539,534

$

2,311,989

(1)
Included for the quarterly period ended December 31, 2023, September 30, 2023, June 30, 2023 and March 31, 2023 were $0.4 million, $0.6 million, $0.9 million and $0.8 million, respectively, related to the allowance for credit loss on held-to-maturity securities.

5

Ponce Financial Group, Inc. and Subsidiaries

Consolidated Statements of Operations

(Dollars in thousands, except per share data)

Three Months Ended

December 31,

September 30,

June 30,

March 31,

December 31,

2023

2023

2023

2023

2022

Interest and dividend income:

Interest on loans receivable

$

27,814

$

25,276

$

23,015

$

19,700

$

18,550

Interest on deposits due from banks

990

1,969

1,817

197

199

Interest and dividend on securities and FHLBNY stock

6,146

6,261

6,223

6,459

6,184

Total interest and dividend income

34,950

33,506

31,055

26,356

24,933

Interest expense:

Interest on certificates of deposit

5,103

4,362

3,881

3,225

1,786

Interest on other deposits

5,706

5,639

4,413

2,812

3,649

Interest on borrowings

6,944

6,963

6,479

5,074

3,332

Total interest expense

17,753

16,964

14,773

11,111

8,767

Net interest income

17,197

16,542

16,282

15,245

16,166

(Benefit) provision for credit losses

(375

)

535

987

(174

)

12,641

Net interest income after provision (benefit) for credit losses

17,572

16,007

15,295

15,419

3,525

Non-interest income:

Service charges and fees

498

516

481

491

481

Brokerage commissions

13

17

35

15

180

Late and prepayment charges

365

899

372

729

263

Income on sale of mortgage loans

244

173

82

99

7

Loan origination (1)

-

-

-

-

(557

)

Grant income

438

3,718

-

-

-

Other

(273

)

304

522

485

63

Total non-interest income

1,285

5,627

1,492

1,819

437

Non-interest expense:

Compensation and benefits

8,262

7,566

7,425

7,446

6,501

Occupancy and equipment

3,686

3,588

3,724

3,570

3,928

Data processing expenses

1,101

1,582

1,208

1,192

1,114

Direct loan expenses

497

369

345

412

454

Provision for contingencies

418

391

517

985

(440

)

Insurance and surety bond premiums

250

255

248

265

270

Office supplies, telephone and postage

294

301

489

399

375

Professional fees

2,040

1,693

1,904

1,455

1,571

Grain (recoveries) and write-off

(152

)

(69

)

(346

)

(914

)

(515

)

Marketing and promotional expenses

146

248

303

128

256

Directors fees and regulatory assessment

173

169

160

155

196

Other operating expenses

1,182

1,223

1,112

1,268

2,055

Total non-interest expense

17,897

17,316

17,089

16,361

15,765

Income (loss) before income taxes

960

4,318

(302

)

877

(11,803

)

Provision (benefit) for income taxes

442

1,728

(215

)

546

(2,589

)

Net income (loss)

$

518

$

2,590

$

(87

)

$

331

$

(9,214

)

Earnings (loss) per common share:

Basic

$

0.02

$

0.12

$

(0.00

)

$

0.01

$

(0.40

)

Diluted

$

0.02

$

0.12

$

(0.00

)

$

0.01

$

(0.40

)

Weighted average common shares outstanding:

Basic

22,224,945

22,272,076

23,208,168

23,293,013

23,168,097

Diluted

22,406,102

22,349,217

23,208,168

23,324,532

23,168,097

(1)
Amounts for the quarterly period ended December 31, 2022 include the reversal of $0.8 million of loan origination income that had been taken upfront in prior quarters of 2022 (as opposed to deferred over the life of ‎the loan)‎.

6

Ponce Financial Group, Inc. and Subsidiaries

Consolidated Statements of Operations

(Dollars in thousands, except per share data)

For the Years Ended December 31,

2023

2022

Variance $

Variance %

Interest and dividend income:

Interest on loans receivable

$

95,805

$

69,865

$

25,940

37.13

%

Interest on deposits due from banks

4,973

713

4,260

597.48

%

Interest and dividend on securities and FHLBNY stock

25,089

12,174

12,915

106.09

%

Total interest and dividend income

125,867

82,752

43,115

52.10

%

Interest expense:

Interest on certificates of deposit

16,571

4,148

12,423

299.49

%

Interest on other deposits

18,570

5,802

12,768

220.06

%

Interest on borrowings

25,460

6,199

19,261

310.71

%

Total interest expense

60,601

16,149

44,452

275.26

%

Net interest income

65,266

66,603

(1,337

)

(2.01

%)

Provision for credit losses

973

24,046

(23,073

)

(95.95

%)

Net interest income after provision for credit losses

64,293

42,557

21,736

51.08

%

Non-interest income:

Service charges and fees

1,986

1,830

156

8.52

%

Brokerage commissions

80

1,020

(940

)

(92.16

%)

Late and prepayment charges

2,365

623

1,742

279.61

%

Income on sale of mortgage loans

598

741

(143

)

(19.30

%)

Loan origination

-

1,286

(1,286

)

(100.00

%)

Grant income

4,156

-

4,156

-

%

Loss on sale of premises and equipment

-

(436

)

436

(100.00

%)

Other

1,038

1,355

(317

)

(23.39

%)

Total non-interest income

10,223

6,419

3,804

59.26

%

Non-interest expense:

Compensation and benefits

30,699

27,914

2,785

9.98

%

Occupancy and equipment

14,568

13,968

600

4.30

%

Data processing expenses

5,083

3,779

1,304

34.51

%

Direct loan expenses

1,623

2,487

(864

)

(34.74

%)

Provision for contingencies

2,311

126

2,185

1,734.13

%

Insurance and surety bond premiums

1,018

870

148

17.01

%

Office supplies, telephone and postage

1,483

1,555

(72

)

(4.63

%)

Professional fees

7,092

5,904

1,188

20.12

%

Contribution to the Ponce De Leon Foundation

-

4,995

(4,995

)

(100.00

%)

Grain (recoveries) and write-off

(1,481

)

17,940

(19,421

)

(108.26

%)

Marketing and promotional expenses

825

593

232

39.12

%

Directors fees and regulatory assessment

657

705

(48

)

(6.81

%)

Other operating expenses

4,785

4,986

(201

)

(4.03

%)

Total non-interest expense

68,663

85,822

(17,159

)

(19.99

%)

Income (loss) before income taxes

5,853

(36,846

)

42,699

(115.89

%)

Provision (benefit) for income taxes

2,501

(6,845

)

9,346

(136.54

%)

Net income (loss)

$

3,352

$

(30,001

)

$

33,353

(111.17

%)

Earnings (loss) per common share:

Basic

$

0.15

$

(1.32

)

$

1.47

(111.15

%)

Diluted

$

0.15

$

(1.32

)

$

1.47

(111.11

%)

Weighted average common shares outstanding:

Basic

22,745,317

22,690,943

54,374

0.24

%

Diluted

22,822,313

22,690,943

131,370

0.58

%

7

Ponce Financial Group, Inc. and Subsidiaries

Key Metrics

At or for the Three Months Ended

December 31,

September 30,

June 30,

March 31,

December 31,

2023

2023

2023

2023

2022

Performance Ratios:

Return on average assets (1)

0.08

%

0.39

%

(0.01

%)

0.06

%

(1.62

%)

Return on average equity (1)

0.42

%

2.11

%

(0.07

%)

0.27

%

(7.28

%)

Net interest rate spread (1) (2)

1.63

%

1.58

%

1.66

%

1.78

%

2.13

%

Net interest margin (1) (3)

2.66

%

2.58

%

2.65

%

2.75

%

2.97

%

Non-interest expense to average assets (1)

2.66

%

2.58

%

2.65

%

2.79

%

2.78

%

Efficiency ratio (4)

96.83

%

78.11

%

96.15

%

95.88

%

94.95

%

Average interest-earning assets to average interest- bearing liabilities

137.49

%

137.92

%

141.14

%

148.20

%

152.30

%

Average equity to average assets

18.25

%

18.32

%

19.21

%

20.91

%

22.32

%

Capital Ratios:

Total capital to risk weighted assets (Bank only)

23.30

%

25.10

%

26.30

%

27.54

%

30.53

%

Tier 1 capital to risk weighted assets (Bank only)

22.05

%

23.85

%

25.05

%

26.28

%

29.26

%

Common equity Tier 1 capital to risk-weighted assets (Bank only)

22.05

%

23.85

%

25.05

%

26.28

%

29.26

%

Tier 1 capital to average assets (Bank only)

17.49

%

17.51

%

17.95

%

19.51

%

20.47

%

Asset Quality Ratios:

Allowance for credit losses on loans as a percentage of total loans

1.36

%

1.51

%

1.64

%

1.77

%

2.27

%

Allowance for credit losses on loans as a percentage of nonperforming loans

152.99

%

169.49

%

167.06

%

149.73

%

252.33

%

Net (charge-offs) recoveries to average outstanding loans (1)

(0.24

%)

(0.34

%)

(0.41

%)

(0.57

%)

(0.85

%)

Non-performing loans as a percentage of total gross loans

0.89

%

0.89

%

0.98

%

1.18

%

0.90

%

Non-performing loans as a percentage of total assets

0.62

%

0.62

%

0.63

%

0.76

%

0.59

%

Total non-performing assets as a percentage of total assets

0.62

%

0.62

%

0.63

%

0.76

%

0.59

%

Total non-performing assets and accruing modifications to borrowers experiencing financial difficulty as a percentage of total assets (5)

0.81

%

0.82

%

0.83

%

0.93

%

0.78

%

Other:

Number of offices

18

19

19

19

19

Number of full-time equivalent employees

237

243

244

251

253

(1)
Annualized where appropriate.
(2)
Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average rate of interest-bearing liabilities.
(3)
Net interest margin represents net interest income divided by average total interest-earning assets.
(4)
Efficiency ratio represents noninterest expense divided by the sum of net interest income and noninterest income.
(5)
For periods in 2023, balances include both modifications to borrowers experiencing financial difficulty, in accordance with ASU 2022-02 adopted on January 1, 2023, and previously existing troubled debt restructurings. For the period in 2022, the balances only include troubled debt restructurings.

8

Ponce Financial Group, Inc. and Subsidiaries

Securities Portfolio

December 31, 2023

December 31, 2022

Gross

Gross

Gross

Gross

Amortized

Unrealized

Unrealized

Amortized

Unrealized

Unrealized

Cost

Gains

Losses

Fair Value

Cost

Gains

Losses

Fair Value

(in thousands)

(in thousands)

Available-for-Sale Securities:

U.S. Government Bonds

$

2,990

$

-

$

(206

)

$

2,784

$

2,985

$

-

$

(296

)

$

2,689

Corporate Bonds

25,790

-

(2,122

)

23,668

25,824

-

(2,465

)

23,359

Mortgage-Backed Securities:

Collateralized Mortgage Obligations (1)

39,375

-

(6,227

)

33,148

44,503

-

(6,726

)

37,777

FHLMC Certificates

10,163

-

(1,482

)

8,681

11,310

-

(1,676

)

9,634

FNMA Certificates

61,359

-

(9,842

)

51,517

67,199

-

(11,271

)

55,928

GNMA Certificates

104

-

-

104

122

-

(4

)

118

Total available-for-sale securities

$

139,781

$

-

$

(19,879

)

$

119,902

$

151,943

$

-

$

(22,438

)

$

129,505

Held-to-Maturity Securities:

U.S. Agency Bonds

$

25,000

$

-

$

(181

)

$

24,819

$

35,000

$

-

$

(380

)

$

34,620

Corporate Bonds

82,500

-

(2,691

)

79,809

82,500

57

(3,819

)

78,738

Mortgage-Backed Securities:

Collateralized Mortgage Obligations (1)

212,093

104

(5,170

)

207,027

235,479

192

(5,558

)

230,113

FHLMC Certificates

3,897

-

(244

)

3,653

4,120

-

(268

)

3,852

FNMA Certificates

118,944

-

(4,088

)

114,856

131,918

-

(5,227

)

126,691

SBA Certificates

19,712

166

-

19,878

21,803

34

-

21,837

Allowance for Credit Losses

(398

)

-

-

-

-

-

-

-

Total held-to-maturity securities

$

461,748

$

270

$

(12,374

)

$

450,042

$

510,820

$

283

$

(15,252

)

$

495,851

(1)
Comprised of Federal Home Loan Mortgage Corporation ("FHLMC"), Federal National Mortgage Association ("FNMA") and Ginnie Mae ("GNMA") issued securities.

The following table presents the activity in the allowance for credit losses for held-to-maturity securities.

December 31,

2023

2022

Beginning balance

$

-

$

-

CECL adoption

662

-

Provision for credit losses

(264

)

-

Allowance for credit losses on securities

$

398

$

-

9

Ponce Financial Group, Inc. and Subsidiaries

Loan Portfolio

As of

December 31,

September 30,

June 30,

March 31,

December 31,

2023

2023

2023

2023

2022

Amount

Percent

Amount

Percent

Amount

Percent

Amount

Percent

Amount

Percent

(Dollars in thousands)

Mortgage loans:

1-4 family residential

Investor Owned

$

343,689

17.89

%

$

347,082

19.13

%

$

351,754

20.43

%

$

354,559

21.60

%

$

343,968

22.54

%

Owner-Occupied

152,311

7.93

%

151,866

8.37

%

154,116

8.94

%

149,481

9.10

%

134,878

8.84

%

Multifamily residential

550,559

28.65

%

553,694

30.52

%

550,033

31.94

%

553,430

33.71

%

494,667

32.42

%

Nonresidential properties

342,343

17.81

%

321,472

17.71

%

317,416

18.43

%

314,560

19.17

%

308,043

20.19

%

Construction and land

503,925

26.22

%

411,383

22.67

%

315,843

18.34

%

235,157

14.33

%

185,018

12.13

%

Total mortgage loans

1,892,827

98.50

%

1,785,497

98.40

%

1,689,162

98.08

%

1,607,187

97.91

%

1,466,574

96.12

%

Non-mortgage loans:

Business loans (1)

19,779

1.03

%

18,416

1.02

%

21,041

1.22

%

19,890

1.21

%

39,965

2.62

%

Consumer loans (2)

8,966

0.47

%

10,416

0.58

%

11,958

0.70

%

14,227

0.88

%

19,129

1.26

%

Total non-mortgage loans

28,745

1.50

%

28,832

1.60

%

32,999

1.92

%

34,117

2.09

%

59,094

3.88

%

Total loans, gross

1,921,572

100.00

%

1,814,329

100.00

%

1,722,161

100.00

%

1,641,304

100.00

%

1,525,668

100.00

%

Net deferred loan origination costs

468

692

1,059

2,099

2,051

Allowance for credit losses on loans

(26,154

)

(27,414

)

(28,173

)

(28,975

)

(34,592

)

Loans, net

$

1,895,886

$

1,787,607

$

1,695,047

$

1,614,428

$

1,493,127

(1)
As of December 31, 2023, September 30, 2023, June 30, 2023, March 31, 2023 and December 31, 2022, business loans include $1.0 million, $1.1million, $3.2 million, $3.6 million and $20.0 million, respectively, of PPP loans.
(2)
As of December 31, 2023, September 30, 2023, June 30, 2023, March 31, 2023 and December 31, 2022, consumer loans include $8.0 million, $9.3 million, $11.2 million, $13.4 million and $18.2 million, respectively, of loans originated by the Bank pursuant to its arrangement with Grain.

10

Ponce Financial Group, Inc. and Subsidiaries

Grain Loan Exposure

Grain Technologies, Inc. ("Grain") Total Exposure as of December 31, 2023

(in thousands)

Receivable from Grain

Microloans originated - put back to Grain (inception-to-December 31, 2023)

$

24,104

Write-downs, net of recoveries (inception-to-date as of December 31, 2023)

(15,459

)

Cash receipts from Grain (inception-to-December 31, 2023)

(6,819

)

Grant/reserve

(1,826

)

Net receivable as of December 31, 2023

$

-

Microloan receivables from Grain Borrowers

Grain originated loans receivable as of December 31, 2023

$

7,985

Allowance for credit losses on loans as of December 31, 2023 (1)

(7,026

)

Microloans, net of allowance for credit losses on loans as of December 31, 2023

$

959

Investments

Investment in Grain

$

1,000

Investment in Grain write-off in Q3 2022

(1,000

)

Investment in Grain as of December 31, 2023

-

Total exposure related to Grain as of December 31, 2023 (2)

$

959

(1) Includes $0.3 million for allowance for unused commitments on the $2.4 million of unused commitments available to Grain originated borrowers reported in other liabilities in the accompanying Consolidated Statements of Financial Conditions. Excludes $1.6 million of security deposits by Grain originated borrowers reported in deposits in the accompanying Consolidated Statements of Financial Conditions.

(2) Total remaining exposure to Grain borrowers. These loans are now serviced by the Bank.

On November 1, 2023, Ponce Financial Group, Inc. and Grain signed a Perpetual Software License Agreement in order for the Bank to assume the servicing of the remaining Grain loans. In order to facilitate the transfer of the servicing responsibilities to the Bank, Grain granted the Bank a perpetual right and license to use the Grain software, including the source code to service the remaining loans.

11

Ponce Financial Group, Inc. and Subsidiaries

Allowance for Credit Losses on Loans

For the Three Months Ended

December 31,

September 30,

June 30,

March 31,

December 31,

2023

2023

2023

2023

2022

(Dollars in thousands)

Allowance for credit losses on loans at beginning of the period

$

27,414

$

28,173

$

28,975

$

34,592

$

25,108

Provision (benefit) for credit losses on loans

(126

)

750

934

(321

)

12,641

Adoption of CECL

-

-

-

(3,090

)

-

Charge-offs:

Mortgage loans:

1-4 family residences

Investor owned

-

-

-

-

-

Owner occupied

-

-

-

-

-

Multifamily residences

-

-

-

-

-

Nonresidential properties

-

-

-

-

-

Construction and land

-

-

-

-

-

Non-mortgage loans:

Business

(63

)

-

-

-

-

Consumer

(1,135

)

(1,592

)

(1,931

)

(2,569

)

(3,659

)

Total charge-offs

(1,198

)

(1,592

)

(1,931

)

(2,569

)

(3,659

)

Recoveries:

Mortgage loans:

1-4 family residences

Investor owned

-

-

-

-

-

Owner occupied

-

-

-

-

-

Multifamily residences

-

-

-

-

-

Nonresidential properties

-

-

-

-

-

Construction and land

-

-

-

-

-

Non-mortgage loans:

Business

-

3

-

-

-

Consumer

64

80

195

363

502

Total recoveries

64

83

195

363

502

Net (charge-offs) recoveries

(1,134

)

(1,509

)

(1,736

)

(2,206

)

(3,157

)

Allowance for credit losses on loans at end of the period

$

26,154

$

27,414

$

28,173

$

28,975

$

34,592

12

Ponce Financial Group, Inc. and Subsidiaries

Deposits

As of

December 31,

September 30,

June 30,

March 31,

December 31,

2023

2023

2023

2023

2022

Amount

Percent

Amount

Percent

Amount

Percent

Amount

Percent

Amount

Percent

(Dollars in thousands)

Demand

$

243,384

16.14

%

$

265,862

18.98

%

$

266,545

18.48

%

$

282,741

21.15

%

$

289,149

23.08

%

Interest-bearing deposits:

NOW/IOLA accounts

19,676

1.31

%

22,519

1.61

%

22,754

1.57

%

21,735

1.63

%

24,349

1.94

%

Money market accounts (1)

432,735

28.70

%

370,500

26.44

%

387,970

26.91

%

293,140

21.93

%

236,143

18.86

%

Reciprocal deposits

96,860

6.42

%

82,670

5.90

%

100,919

7.00

%

109,649

8.20

%

114,049

9.11

%

Savings accounts

114,139

7.57

%

117,870

8.41

%

119,635

8.30

%

127,731

9.55

%

130,432

10.41

%

Total NOW, money market, reciprocal and savings accounts

663,410

44.00

%

593,559

42.36

%

631,278

43.78

%

552,255

41.31

%

504,973

40.32

%

Certificates of deposit of $250K or more (1)

132,153

8.77

%

122,353

8.73

%

120,043

8.32

%

113,955

8.52

%

106,336

8.49

%

Brokered certificates of deposit (2)

98,729

6.55

%

98,729

7.05

%

98,729

6.85

%

98,754

7.39

%

98,754

7.89

%

Listing service deposits (2)

14,433

0.96

%

15,180

1.08

%

20,258

1.40

%

28,417

2.13

%

35,813

2.86

%

All other certificates of deposit less than $250K (1)

355,511

23.58

%

305,449

21.80

%

305,160

21.17

%

260,755

19.50

%

217,387

17.36

%

Total certificates of deposit

600,826

39.86

%

541,711

38.66

%

544,190

37.74

%

501,881

37.54

%

458,290

36.60

%

Total interest-bearing deposits

1,264,236

83.86

%

1,135,270

81.02

%

1,175,468

81.52

%

1,054,136

78.85

%

963,263

76.92

%

Total deposits

$

1,507,620

100.00

%

$

1,401,132

100.00

%

$

1,442,013

100.00

%

$

1,336,877

100.00

%

$

1,252,412

100.00

%

(1)
As of June 30, 2023, March 31, 2023 and December 31, 2022, $150.6 million, $115.3 million and $81.7 million, respectively, of SaveBetter deposits were reclassified from money market accounts to certificates of deposits. $36.4 million, $37.1 million and $36.2 million, respectively, were reclassified to Certificates of deposits of $250K or more and $114.2 million, $78.2 million and $45.5 million, respectively, were reclassified to certificates of deposit less than $250K.
(2)
As of December 31, 2023, September 30, 2023, June 30, 2023, March 31, 2023 and December 31, 2022, there were $0.3 million, $0.3 million, $3.3 million, $9.5 million and $13.6 million, respectively, in individual listing service deposits amounting to $250,000 or more. All brokered certificates of deposit individually amounted to less than $250,000.

13

Ponce Financial Group, Inc. and Subsidiaries

Borrowings

December 31,

December 31,

2023

2022

Scheduled
Maturity

Redeemable
at Call Date

Weighted
Average
Rate

Scheduled
Maturity

Redeemable
at Call Date

Weighted
Average
Rate

(Dollars in thousands)

Overnight line of credit
advance

$

-

$

-

-

%

$

6,000

$

6,000

4.61

%

Term advances ending:

2023

$

-

$

-

-

$

178,375

$

178,375

4.32

2024

363,321

363,321

4.55

50,000

50,000

4.75

2025

50,000

50,000

4.41

50,000

50,000

4.41

2026

-

-

-

-

-

-

2027

212,000

212,000

3.44

183,000

183,000

3.25

2028

9,100

9,100

3.84

-

-

-

Thereafter

50,000

50,000

3.35

50,000

50,000

3.35

$

684,421

$

684,421

4.10

%

$

517,375

$

517,375

3.90

%

14

Ponce Financial Group, Inc. and Subsidiaries

Nonperforming Assets

As of Three Months Ended

December 31,

September 30,

June 30,

March 31,

December 31,

2023

2023

2023

2023

2022

(Dollars in thousands)

Non-accrual loans:

Mortgage loans:

1-4 family residential

Investor owned

$

793

$

396

$

296

$

2,836

$

2,844

Owner occupied

1,682

1,685

2,363

2,245

961

Multifamily residential

2,979

1,444

1,435

-

-

Nonresidential properties

-

-

-

-

-

Construction and land

10,759

11,721

11,721

11,906

7,567

Non-mortgage loans:

Business

19

209

-

40

-

Consumer

146

-

-

-

-

Total non-accrual loans (not including non-accruing modifications to borrowers experiencing financial difficulty) (1)

$

16,378

$

15,455

$

15,815

$

17,027

$

11,372

Non-accruing modifications to borrowers experiencing financial difficulty (1):

Mortgage loans:

1-4 family residential

Investor owned

$

270

$

270

$

209

$

213

$

217

Owner occupied

447

449

840

2,020

2,027

Multifamily residential

-

-

-

-

-

Nonresidential properties

-

-

-

91

93

Construction and land

-

-

-

-

-

Non-mortgage loans:

Business

-

-

-

-

-

Consumer

-

-

-

-

-

Total non-accruing modifications to borrowers experiencing financial difficulty (1)

717

719

1,049

2,324

2,337

Total non-accrual loans

$

17,095

$

16,174

$

16,864

$

19,351

$

13,709

Accruing modifications to borrowers experiencing financial difficulty (1):

Mortgage loans:

1-4 family residential

Investor owned

$

2,112

$

2,131

$

2,161

$

2,185

$

2,207

Owner occupied

2,313

2,335

2,353

1,310

1,328

Multifamily residential

-

-

-

-

-

Nonresidential properties

757

765

783

701

708

Construction and land

-

-

-

-

-

Non-mortgage loans:

Business

-

-

-

-

-

Consumer

-

-

-

-

-

Total accruing modifications to borrowers experiencing financial difficulty (1)

$

5,182

$

5,231

$

5,297

$

4,196

$

4,243

Total non-performing assets and accruing modifications to borrowers experiencing financial difficulty (1)

$

22,277

$

21,405

$

22,161

$

23,547

$

17,952

Total non-performing loans to total gross loans

0.89

%

0.89

%

0.98

%

1.18

%

0.90

%

Total non-performing assets to total assets

0.62

%

0.62

%

0.63

%

0.76

%

0.59

%

Total non-performing assets and accruing modifications to borrowers experiencing financial difficulty as a percentage of total assets (1)

0.81

%

0.82

%

0.83

%

0.93

%

0.78

%

(1) For periods in 2023, balances include both modifications to borrowers experiencing financial difficulty, in accordance with ASU 2022-02 adopted on January 1, 2023, and previously existing troubled debt restructurings. For the period in 2022, the balances only include troubled debt restructurings.

15

Ponce Financial Group, Inc. and Subsidiaries

Average Balance Sheets

For the Three Months Ended December 31,

2023

2022

Average

Average

Outstanding

Average

Outstanding

Average

Balance

Interest

Yield/Rate (1)

Balance

Interest

Yield/Rate (1)

(Dollars in thousands)

Interest-earning assets:

Loans (2)

$

1,884,301

$

27,814

5.86%

$

1,478,308

$

18,550

4.98%

Securities (3)

582,563

5,715

3.89%

636,457

5,931

3.70%

Other (4)(5)

96,070

1,421

5.87%

47,069

452

3.81%

Total interest-earning assets

2,562,934

34,950

5.41%

2,161,834

24,933

4.58%

Non-interest-earning assets (5)

107,305

87,861

Total assets

$

2,670,239

$

2,249,695

Interest-bearing liabilities:

NOW/IOLA

$

20,210

$

8

0.16%

$

25,349

$

22

0.34%

Money market (6)

474,306

5,668

4.74%

437,813

3,619

3.28%

Savings

116,600

28

0.10%

139,115

8

0.02%

Certificates of deposit (6)

559,713

5,103

3.62%

434,368

1,786

1.63%

Total deposits

1,170,829

10,807

3.66%

1,036,645

5,435

2.08%

Advance payments by borrowers

15,033

2

0.05%

12,942

-

- %

Borrowings

678,235

6,944

4.06%

369,832

3,332

3.57%

Total interest-bearing liabilities

1,864,097

17,753

3.78%

1,419,419

8,767

2.45%

Non-interest-bearing liabilities:

Non-interest-bearing demand

267,150

-

325,616

-

Other non-interest-bearing liabilities

51,764

-

2,424

-

Total non-interest-bearing liabilities

318,914

-

328,040

-

Total liabilities

2,183,011

17,753

1,747,459

8,767

Total equity

487,228

502,236

Total liabilities and total equity

$

2,670,239

3.78%

$

2,249,695

2.45%

Net interest income

$

17,197

$

16,166

Net interest rate spread (7)

1.63%

2.13%

Net interest-earning assets (8)

$

698,837

$

742,415

Net interest margin (9)

2.66%

2.97%

Average interest-earning assets to interest-bearing liabilities

137.49%

152.30%

(1)
Annualized where appropriate.
(2)
Loans include loans and mortgage loans held for sale, at fair value.
(3)
Securities include available-for-sale securities and held-to-maturity securities.
(4)
Includes FHLBNY demand account, FHLBNY stock dividends and FRB demand deposits.
(5)
FRB demand deposits for prior period have been reclassified for consistency.
(6)
Includes reclassification of $65.5 million average outstanding balances and $0.5 million of interest expenses from money market to certificates of deposit for the three months ended December 31, 2022.
(7)
Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average rate of interest-bearing liabilities.
(8)
Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
(9)
Net interest margin represents net interest income divided by average total interest-earning assets.

16

Ponce Financial Group, Inc. and Subsidiaries

Average Balance Sheets

For the Years Ended December 31,

2023

2022

Average

Average

Outstanding

Average

Outstanding

Average

Balance

Interest

Yield/Rate (1)

Balance

Interest

Yield/Rate

(Dollars in thousands)

Interest-earning assets:

Loans (2)

$

1,730,275

$

95,805

5.54

%

$

1,375,723

$

69,865

5.08

%

Securities (3)

606,815

23,342

3.85

%

357,446

11,709

3.28

%

Other (4)(5)

119,923

6,720

5.60

%

84,133

1,178

1.40

%

Total interest-earning assets

2,457,013

125,867

5.12

%

1,817,302

82,752

4.55

%

Non-interest-earning assets (5)

115,760

124,351

Total assets

$

2,572,773

$

1,941,653

Interest-bearing liabilities:

NOW/IOLA

$

22,168

$

33

0.15

%

$

30,151

$

65

0.22

%

Money market (6)

424,160

18,413

4.34

%

367,838

5,604

1.52

%

Savings

121,550

116

0.10

%

138,137

128

0.09

%

Certificates of deposit (6)

528,999

16,571

3.13

%

407,739

4,148

1.02

%

Total deposits

1,096,877

35,133

3.20

%

943,865

9,945

1.05

%

Advance payments by borrowers

14,869

8

0.05

%

11,514

5

0.04

%

Borrowings

633,116

25,460

4.02

%

206,969

6,199

3.00

%

Total interest-bearing liabilities

1,744,862

60,601

3.47

%

1,162,348

16,149

1.39

%

Non-interest-bearing liabilities:

Non-interest-bearing demand

290,335

-

344,505

-

Other non-interest-bearing liabilities

45,858

-

33,225

-

Total non-interest-bearing liabilities

336,193

-

377,730

-

Total liabilities

2,081,055

60,601

1,540,078

16,149

Total equity

491,718

401,575

Total liabilities and total equity

$

2,572,773

3.47

%

$

1,941,653

1.39

%

Net interest income

$

65,266

$

66,603

Net interest rate spread (7)

1.65

%

3.16

%

Net interest-earning assets (8)

$

712,151

$

654,954

Net interest margin (9)

2.66

%

3.66

%

Average interest-earning assets to

interest-bearing liabilities

140.81

%

156.35

%

(1)
Annualized where appropriate.
(2)
Loans include loans and mortgage loans held for sale, at fair value.
(3)
Securities include available-for-sale securities and held-to-maturity securities.
(4)
Includes FHLBNY demand account, FHLBNY stock dividends and FRB demand deposit.
(5)
FRB demand deposits for prior period have been reclassified for consistency.
(6)
Includes reclassification of $25.7 million average outstanding balances and $0.7 million of interest expenses from money market to certificates of deposit for the year ended December 31, 2022.
(7)
Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average rate of interest-bearing liabilities.
(8)
Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
(9)
Net interest margin represents net interest income divided by average total interest-earning assets.

17

Ponce Financial Group, Inc. and Subsidiaries

Other Data

As of

December 31,

September 30,

June 30,

March 31,

December 31,

2023

2023

2023

2023

2022

Other Data

Common shares issued

24,886,711

24,886,711

24,886,711

24,865,476

24,861,329

Less treasury shares

1,101,191

1,233,111

617,924

1,976

1,976

Common shares outstanding at end of period

23,785,520

23,653,600

24,268,787

24,863,500

24,859,353

Book value per common share

$

11.20

$

10.99

$

10.94

$

10.90

$

10.77

Tangible book value per common share

$

11.20

$

10.99

$

10.94

$

10.90

$

10.77

18