Kearny Financial Corp.
For the period ended Sep 30, 2025. Filed Nov 5, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Nov 5, 2025
KRNY$9.01-0.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-05-07.
0001617242-25-000014
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-11-05.
0001617242-25-000073
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 100 previous paragraphs and 72 current paragraphs.
34 unchanged; 31 reworded; 7 added; 21 removed; 14 previous and 0 current paragraphs rearranged.
Tables are not compared: 9 previous and 8 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (7)
Current report
Nonperforming Assets. Nonperforming assets increased $19.0 million to $64.6 million, or 0.84% of total assets, at September 30, 2025, from $45.6 million, or 0.59% of total assets, at June 30, 2025, respectively. The increase was due to a single construction loan that became 90 days past due but remains on accrual status. The loan is secured by collateral under contract for sale, with all covenants satisfied and a loan-to-sale price ratio of 72%. No provision for credit losses related to this loan was recorded as of September 30, 2025, as full repayment is expected upon completion of the sale.
Current report
Provision for Credit Losses. For the quarter ended September 30, 2025, we recorded a reversal of credit losses of $82,000, compared to a provision for credit losses of $108,000 for the quarter ended September 30, 2024. The reversal for the quarter ended September 30, 2025 was largely driven by decreases in the balance of loans receivable, partially offset by qualitative risk factor adjustments. By comparison, the provision for credit losses for the quarter ended September 30, 2024 was primarily driven by loan growth.
Current report
Fees and service charges increased $257,000 to $892,000 for the quarter ended September 30, 2025, from $635,000 for the quarter ended September 30, 2024, primarily reflecting higher deposit and branch related fee income.
Current report
Other income increased $818,000 to $1.7 million for the quarter ended September 30, 2025, from $833,000 for the quarter ended September 30, 2024, primarily driven by a non-recurring pre-tax gain of $749,000 on the sale of property held for sale in the current period.
Current report
Net occupancy expense of premises increased $509,000 to $3.3 million for the quarter ended September 30, 2025, from $2.8 million for the quarter ended September 30, 2024. This increase was primarily driven by a non-recurring pre-tax expense of $250,000 associated with the consolidation of three branches and non-recurring branch maintenance expenses of $102,000 in the current period.
Current report
Advertising and marketing expense increased $220,000 to $562,000 for the quarter ended September 30, 2025, from $342,000 for the quarter ended September 30, 2024. The increase primarily reflects normal fluctuations in the timing of campaigns across various advertising formats supporting our loan and deposit growth initiatives.
Current report
FDIC insurance premiums decreased $262,000 to $1.3 million for the quarter ended September 30, 2025, from $1.6 million for the quarter ended September 30, 2024, primarily driven by higher capital ratios.
Removed paragraphs (21)
Previous report
Nonperforming Assets. Nonperforming assets decreased $2.2 million to $37.7 million, or 0.49% of total assets, at March 31, 2025, from $39.9 million, or 0.52% of total assets, at June 30, 2024, respectively.
Previous report
Provision for Credit Losses. The provision for credit losses increased $17,000 to $366,000 for the quarter ended March 31, 2025, compared to $349,000 for the quarter ended March 31, 2024. The provision for the quarter ended March 31, 2025 was primarily driven by loan charge-offs. By comparison, the provision for credit losses for the quarter ended March 31, 2024 was primarily driven by loan growth compared to previous quarter end loan balances.
Previous report
Gain on sale of loans was $112,000 compared to a loss on sale of loans of $712,000 in the comparative period. The loss in the prior year period was primarily the result of the sale of three related nonperforming commercial real estate loans held-for-sale.
Previous report
Income from BOLI decreased $422,000 to $2.6 million for the quarter ended March 31, 2025, primarily driven by the absence of a $631,000 non-recurring payment on one life insurance policy recorded in the prior year period, partially offset by improved income resulting from the BOLI restructure initiated in December 2023.
Previous report
Net occupancy expense of premises increased $212,000 to $3.1 million for the quarter ended March 31, 2025. This increase was primarily driven by higher snow removal expenses due to abnormally harsh winter conditions.
Previous report
Advertising and marketing expense increased $222,000 to $609,000 for the quarter ended March 31, 2025, largely driven by an increase in digital and online advertising campaigns to support our deposit growth initiatives.
Previous report
Net Income. Net income for the nine months ended March 31, 2025 was $19.3 million, or $0.31 per diluted share, compared to $3.4 million, or $0.06 per diluted share, for the nine months ended March 31, 2024. The increase in net income primarily reflected an increase in non-interest income as well as decreases in the provision for credit losses and income tax expense, partially offset by a decrease in net interest income and an increase in non-interest expense. Net income for the prior year period included a $12.9 million after-tax net loss on the sale of securities that resulted from the repositioning of our investment securities portfolio in December 2023 and an after-tax net loss of $6.3 million from the previously disclosed BOLI restructure.
Previous report
Net Interest Income. Net interest income decreased by $10.2 million to $99.1 million for the nine months ended March 31, 2025 compared to $109.3 million for the nine months ended March 31, 2024. The decrease between the comparative periods resulted from an increase of $8.4 million in interest expense and a decrease of $1.8 million in interest income. Included in net interest income for the nine months ended March 31, 2025 and 2024, respectively, was purchase accounting accretion of $1.8 million and $2.0 million, and loan prepayment penalty income of $566,000 and $513,000.
Previous report
Net interest margin decreased 14 basis points to 1.84% for the nine months ended March 31, 2025, from 1.98% for the nine months ended March 31, 2024 and reflected an increase in the cost of interest-bearing liabilities and a decrease in the average balance of interest-earning assets, partially offset by increases in the yield on interest-earning assets and a decrease in the average balance of interest-bearing liabilities.
Previous report
Provision for Credit Losses. The provision for credit losses decreased $2.1 million to $581,000 for the nine months ended March 31, 2025, compared to $2.7 million for the nine months ended March 31, 2024. The provision for the nine months ended March 31, 2025 was primarily driven by charge-offs and loan growth. By comparison, the provision for credit losses for the nine months ended March 31, 2024 was primarily driven by charge-offs on three related commercial real estate loans.
Previous report
Non-Interest Income. Total non-interest income increased $21.9 million to $14.1 million for the nine months ended March 31, 2025, compared to a loss of $7.8 million for the nine months ended March 31, 2024.
Previous report
There were no gains on sale and call of securities during the nine months ended March 31, 2025 compared to a loss of $18.1 million recorded during the prior year period. The loss in the prior period was due to the repositioning of our investment securities portfolio that involved the sale of $122.2 million of available for sale debt securities in December 2023.
Previous report
Gain on sale of loans was $616,000 for the nine months ended March 31, 2025 compared to a loss on sale of loans of $393,000 for the nine months ended March 31, 2024. The loss in the prior year period was primarily the result of the sale of three related nonperforming commercial real estate loans held-for-sale.
Previous report
We recognized a non-recurring loss of $973,000 attributable to the write-down of one other real estate owned (“OREO”) property during the quarter ended December 31, 2023, while there were no such losses recorded in the current period.
Previous report
Income from bank owned life insurance increased $1.9 million to $7.8 million for the nine months ended March 31, 2025. The increase was primarily due to improved income resulting from the BOLI restructure initiated in December 2023, and the absence of non-recurring exchange charges related to the restructure recorded in the prior year period. This increase was partially offset by the absence of a $631,000 non-recurring payment on one life insurance policy recorded in the prior year period.
Previous report
Non-Interest Expense. Total non-interest expense increased $1.1 million to $89.7 million for the nine months ended March 31, 2025, compared to $88.6 million for the nine months ended March 31, 2024.
Previous report
Net occupancy expense of premises increased $409,000 to $8.7 million for the nine months ended March 31, 2025. This increase was primarily driven by higher snow removal expenses due to abnormally harsh winter conditions.
Previous report
Advertising and marketing expense increased $346,000 to $1.3 million for the nine months ended March 31, 2025. This increase in advertising expense was largely driven by an increase in digital and online advertising campaigns to support our deposit growth initiatives.
Previous report
Other non-interest expense decreased $646,000 to $9.8 million for the nine months ended March 31, 2025. This decrease reflected a decrease in OREO expenses due to the sale of the bank’s sole OREO asset in the quarter ended December 31, 2023, partially offset by an increase in the provision for credit losses on off balance sheet commitments.
Previous report
Provision for Income Taxes. Provision for income taxes decreased $3.3 million to $3.5 million for the nine months ended March 31, 2025 from $6.8 million for the nine months ended March 31, 2024.
Previous report
The decrease in income tax expense reflected the absence of $5.7 million of discrete tax cost associated with the BOLI restructure in the prior year period, partially offset by a higher level of pre-tax income in the current year period.
Reworded paragraphs (31)
Previous wording
This Quarterly Report on Form 10-Q may include certain forward-looking statements based on current management expectations. Such forward-looking statements may be identified by reference to a future period or periods or by the use of forward-looking terminology, such as “may”, “will”, “believe”, “expect”, “estimate”, “anticipate”, “continue”, or similar terms or variations on those terms, or the negative of those terms. The actual results of the Company could differ materially from those management expectations. This includes statements regarding general economic and geopolitical conditions, including potential recessionary conditions and the imposition of tariffs or other domestic or international governmental policies, legislative and regulatory changes, monetary and fiscal policies of the federal government, changes in tax policies, rates and regulations of federal, state and local tax authorities and failure to integrate or profitably operate acquired businesses. Additional potential factors include changes in interest rates, the rate of inflation, deposit flows, cost of funds, demand for loan products and financial services, competition and changes in the quality or composition of loan and investment portfolios of the Company. Other factors that could cause future results to vary from current management expectations include changes in accounting principles, policies or guidelines, and other economic, competitive, governmental and technological factors affecting the Company’s operations, markets, products, services and prices. Further description of the risks and uncertainties to the business are included in this Quarterly Report on Form 10-Q and in the Company’s Annual Report on Form 10-K for the year ended June 30, 2024, under “Item 1A. Risk Factors.”
Current wording
This Quarterly Report on Form 10-Q may include certain forward-looking statements based on current management expectations. Such forward-looking statements may be identified by reference to a future period or periods or by the use of forward-looking terminology, such as “may”, “will”, “believe”, “expect”, “estimate”, “anticipate”, “continue”, or similar terms or variations on those terms, or the negative of those terms. The actual results of the Company could differ materially from those management expectations. This includes statements regarding general economic and geopolitical conditions, including potential recessionary conditions and the imposition of tariffs or other domestic or international governmental policies, legislative and regulatory changes, monetary and fiscal policies of the federal government, the effects of the federal government shutdown, changes in tax policies, rates and regulations of federal, state and local tax authorities and failure to integrate or profitably operate acquired businesses. Additional potential factors include changes in interest rates, the rate of inflation, deposit flows, cost of funds, demand for loan products and financial services, competition and changes in the quality or composition of loan and investment portfolios of the Company. Other factors that could cause future results to vary from current management expectations include changes in accounting principles, policies or guidelines, and other economic, competitive, governmental and technological factors affecting the Company’s operations, markets, products, services and prices. Further description of the risks and uncertainties to the business are included in this Quarterly Report on Form 10-Q and in the Company’s Annual Report on Form 10-K for the year ended June 30, 2025, under “Item 1A. Risk Factors.”
Previous wording
Executive Summary. Total assets increased $49.7 million to $7.73 billion at March 31, 2025 from $7.68 billion at June 30, 2024. The increase primarily reflected increases in cash and cash equivalents and net loans receivable, partially offset by a decrease in investment securities available for sale, as discussed below, declines in the market values of interest rate derivatives and a decrease in Federal Home Loan Bank of New York (“FHLB”) capital stock.
Current wording
Executive Summary. Total assets decreased $92.4 million to $7.65 billion at September 30, 2025 from $7.74 billion at June 30, 2025. The decrease primarily reflected decreases in net loans receivable and cash and cash equivalents, and declines in the market values of interest rate derivatives.
Previous wording
Investment Securities. Investment securities available for sale decreased $69.4 million to $1.00 billion at March 31, 2025, from $1.07 billion at June 30, 2024. This decrease was largely the result of principal repayments of $146.8 million, partially offset by purchases of $58.9 million and an $18.0 million increase in the fair value of the portfolio to a net unrealized loss of $112.7 million.
Current wording
Investment Securities. Investment securities available for sale increased $3.2 million to $1.02 billion at September 30, 2025, from $1.01 billion at June 30, 2025. This increase was largely the result of purchases of $71.2 million and an $11.4 million increase in the fair value of the portfolio to a net unrealized loss of $100.8 million, partially offset by principal repayments of $79.4 million.
Previous wording
Investment securities held to maturity decreased $10.9 million to $124.9 million at March 31, 2025 from $135.7 million at June 30, 2024. This decrease was driven by principal repayments of $11.0 million.
Current wording
Investment securities held to maturity decreased $3.5 million to $116.7 million at September 30, 2025 from $120.2 million at June 30, 2025. This decrease was driven by principal repayments of $3.5 million.
Previous wording
Loans Held-for-Sale. Loans held-for-sale totaled $6.2 million at March 31, 2025 as compared to $6.0 million at June 30, 2024 and are reported separately from the balance of net loans receivable. During the nine months ended March 31, 2025, we sold $81.3 million of residential mortgage loans, resulting in a gain on sale of $616,000.
Current wording
Loans Held-for-Sale. Loans held-for-sale totaled $6.7 million at September 30, 2025 as compared to $5.9 million at June 30, 2025 and are reported separately from the balance of net loans receivable. During the three months ended September 30, 2025, we sold $27.9 million of residential mortgage loans, resulting in a gain on sale of $199,000.
Previous wording
Net Loans Receivable. Net loans receivable increased $113.9 million, or 2.0%, to $5.80 billion at March 31, 2025 from $5.69 billion at June 30, 2024. Details regarding the change in the loan portfolio, by loan segment, are presented below:
Current wording
Net Loans Receivable. Net loans receivable decreased $44.4 million, or 0.8%, to $5.72 billion at September 30, 2025 from $5.77 billion at June 30, 2025. Details regarding the change in the loan portfolio, by loan segment, are presented below:
Previous wording
Commercial loan origination volume for the nine months ended March 31, 2025 totaled $390.7 million, comprised of $220.6 million of commercial mortgage loan originations, $95.1 million of commercial business loan originations and construction loan disbursements of $75.0 million.
Current wording
Commercial loan origination volume for the three months ended September 30, 2025 totaled $61.4 million, comprised of $21.7 million of commercial mortgage loan originations, $24.5 million of commercial business loan originations and construction loan disbursements of $15.2 million. Purchases of commercial business loans totaled $5.1 million for the same period.
Previous wording
One- to four-family residential mortgage loan origination volume, excluding loans held-for-sale, totaled $118.1 million for the nine months ended March 31, 2025. Purchases of one- to four-family residential mortgage loans totaled $730,000 for the same period. Home equity loan and line of credit origination volume for the same period totaled $22.0 million.
Current wording
One- to four-family residential mortgage loan origination volume, excluding loans held-for-sale, totaled $42.2 million for the three months ended September 30, 2025. Home equity loan and line of credit origination volume for the same period totaled $8.7 million.
Previous wording
(1)At March 31, 2025 and June 30, 2024, includes $891,322 and $849,033 of non-owner occupied commercial real estate (“CRE”) loans with an LTV of 53% and 53%, respectively, and includes $96,752 and $99,042 of owner occupied CRE loans with an LTV of 48% and 50%, respectively.
Current wording
(1)At September 30, 2025 and June 30, 2025, includes $896,707 and $891,995 of non-owner occupied commercial real estate (“CRE”) loans with an LTV of 52% and 53%, respectively, and includes $92,262 and $94,561 of owner occupied CRE loans with an LTV of 47% and 48%, respectively.
Previous wording
Allowance for Credit Losses (“ACL”). At March 31, 2025 and June 30, 2024, the ACL totaled $44.5 million, or 0.76% of total loans. The ACL for the nine months ended March 31, 2025 reflected net charge-offs of $1.1 million, partially offset by a provision for credit losses of $581,000. The provision for credit losses for the nine months ended March 31, 2025 was primarily driven by charge-offs, as discussed above, and an increase in the balance of loans receivable.
Current wording
Allowance for Credit Losses (“ACL”). At September 30, 2025 the ACL totaled $45.1 million, or 0.78% of total loans, compared to $46.2 million, or 0.79% of total loans, at June 30, 2025. The ACL for the three months ended September 30, 2025 reflected net charge-offs of $1.0 million.
Previous wording
Other Assets. The aggregate balance of other assets, including premises and equipment, FHLB stock, interest receivable, goodwill, core deposit intangibles, bank owned life insurance (“BOLI”), deferred income taxes, and other assets, decreased $46.2 million to $670.9 million at March 31, 2025 from $717.1 million at June 30, 2024. The decrease in the balance of these other assets during the nine months ended March 31, 2025 largely reflected a decrease in the market value of interest rate derivatives and a decrease in FHLB stock, partially offset by an increase in BOLI. The remaining change generally reflected normal operating fluctuations within these line items.
Current wording
Other Assets. The aggregate balance of other assets, including premises and equipment, FHLB stock, interest receivable, goodwill, core deposit intangibles, bank owned life insurance (“BOLI”), deferred income taxes, and other assets, decreased $11.3 million to $656.0 million at September 30, 2025 from $667.3 million at June 30, 2025. The decrease in the balance of these other assets during the three months ended September 30, 2025 primarily reflected a decrease in the market value of interest rate derivatives, a decrease in FHLB stock and a decrease in properties held for sale, partially offset by an increase in BOLI. The remaining change generally reflected normal operating fluctuations within these line items.
Previous wording
Deposits. Total deposits increased $549.2 million, or 10.6%, to $5.71 billion at March 31, 2025 from $5.16 billion at June 30, 2024. Included in total deposits are retail and brokered time deposits of $1.22 billion and $732.6 million at March 31, 2025 and $1.20 billion and $408.2 million at June 30, 2024. This increase was driven by a reallocation from FHLB advances into brokered certificates of deposits, due to the relatively more favorable economics of brokered deposits compared to advances in the current economic environment, and growth in deposits from our branch network and digital channels. The following table sets forth the distribution of, and changes in, deposits, by type, for the periods indicated:
Current wording
Deposits. Total deposits decreased $43.3 million, or 0.8%, to $5.63 billion at September 30, 2025 from $5.68 billion at June 30, 2025. Included in total deposits are retail and brokered time deposits of $1.21 billion and $759.2 million, respectively, at September 30, 2025, and $1.22 billion and $757.7 million, respectively, at June 30, 2025. This decrease was primarily driven by declines in interest-bearing demand deposits and certificates of deposits. The following table sets forth the distribution of, and changes in, deposits, by type, for the periods indicated:
Previous wording
Uninsured deposits totaled $1.96 billion as of March 31, 2025 compared to $1.77 billion as of June 30, 2024. Excluding collateralized deposits of state and local governments, and deposits of the Bank’s wholly-owned subsidiary and holding company, uninsured deposits totaled $799.2 million, or 14.0% of total deposits, at March 31, 2025 compared to $764.4 million, or 14.8% of total deposits, at June 30, 2024.
Current wording
Uninsured deposits totaled $2.04 billion as of September 30, 2025 compared to $1.99 billion as of June 30, 2025. Excluding collateralized deposits of state and local governments, and deposits of the Bank’s wholly-owned subsidiary and holding company, uninsured deposits totaled $804.2 million, or 14.3% of total deposits, at September 30, 2025 compared to $813.8 million, or 14.3% of total deposits, at June 30, 2025.
Previous wording
Borrowings. The balance of borrowings decreased by $495.8 million to $1.21 billion at March 31, 2025 from $1.71 billion at June 30, 2024, primarily reflecting a decrease in FHLB and other borrowings as a result of the increase in brokered certificates of deposits, as noted above.
Current wording
Borrowings. The balance of borrowings decreased by $50.0 million to $1.21 billion at September 30, 2025 from $1.26 billion at June 30, 2025, reflecting reductions in FHLB advances.
Previous wording
At March 31, 2025, we maintained available secured borrowing capacity with the FHLB and the Federal Reserve Discount Window of $2.42 billion, representing 31.3% of total assets.
Current wording
At September 30, 2025, we maintained available secured borrowing capacity with the FHLB and the Federal Reserve Discount Window of $2.54 billion, representing 33.2% of total assets.
Previous wording
Other Liabilities. The balance of other liabilities, including advance payments by borrowers for taxes and other miscellaneous liabilities, increased $1.7 million to $63.7 million at March 31, 2025 from $62.0 million at June 30, 2024. The change in the balance of these other liabilities generally reflected normal operating fluctuations during the period.
Current wording
Other Liabilities. The balance of other liabilities, including advance payments by borrowers for taxes and other miscellaneous liabilities, decreased $6.4 million to $56.4 million at September 30, 2025 from $62.8 million at June 30, 2025. The change in the balance of these other liabilities generally reflected normal operating fluctuations during the period.
Previous wording
Stockholders’ Equity. Stockholders’ equity decreased $5.5 million to $748.1 million at March 31, 2025 from $753.6 million at June 30, 2024. The decrease in stockholders’ equity during the nine months ended March 31, 2025 largely reflected cash dividends of $20.7 million and an other comprehensive loss of $6.0 million, partially offset by net income of $19.3 million. The other comprehensive loss for the nine months ended March 31, 2025 was driven by a decrease in the fair value of our derivatives portfolio, partially offset by an increase in the fair value of our available for sale securities.
Current wording
Stockholders’ Equity. Stockholders’ equity increased $7.2 million to $753.2 million at September 30, 2025 from $746.0 million at June 30, 2025. The increase in stockholders’ equity during the three months ended September 30, 2025 largely reflected net income of $9.5 million and an other comprehensive gain of $4.3 million, partially offset by cash dividends of $7.0 million. The other comprehensive gain for the three months ended September 30, 2025 was driven by an increase in the fair value of our available for sale securities, partially offset by a decrease in the fair value of our derivatives portfolio.
Previous wording
Book value per share decreased by $0.11 to $11.58 at March 31, 2025 while tangible book value per share decreased by $0.10 to $9.80 at March 31, 2025. These decreases were driven by the decreases in stockholders’ equity, as described above.
Current wording
Book value per share increased by $0.08 to $11.63 at September 30, 2025 while tangible book value per share increased by $0.09 to $9.86 at September 30, 2025. These increases were driven by the increases in stockholders’ equity, as described above.
Previous wording
Net Income. Net income for the quarter ended March 31, 2025 was $6.6 million, or $0.11 per diluted share, compared to $7.4 million, or $0.12 per diluted share, for the quarter ended March 31, 2024. The decrease in net income reflected an increase in non-interest expense and a decrease in net interest income, partially offset by an increase in non-interest income and lower income tax expense.
Current wording
Net Income. Net income for the quarter ended September 30, 2025 was $9.5 million, or $0.15 per diluted share, compared to $6.1 million, or $0.10 per diluted share, for the quarter ended September 30, 2024. The increase in net income reflected increases in net interest income and non-interest income, partially offset by increases in non-interest expense and income taxes.
Previous wording
Net Interest Income. Net interest income decreased by $277,000 to $34.0 million for the quarter ended March 31, 2025 compared to $34.3 million for the quarter ended March 31, 2024. The decrease between the comparative periods resulted from a decrease of $2.8 million in interest income, partially offset by a decrease of $2.5 million in interest expense. Included in net interest income for the quarters ended March 31, 2025 and 2024, respectively, was purchase accounting accretion of $511,000 and $734,000, and loan prepayment penalty income of $226,000 and $61,000.
Current wording
Net Interest Income. Net interest income increased by $5.3 million to $37.7 million for the quarter ended September 30, 2025 compared to $32.4 million for the quarter ended September 30, 2024. The increase between the comparative periods resulted from a decrease of $6.0 million in interest expense, partially offset by a decrease of $744,000 in interest income. Included in net interest income for the quarters ended September 30, 2025 and 2024, respectively, was purchase accounting accretion of $601,000 and $649,000, and loan prepayment penalty income of $490,000 and $52,000.
Previous wording
Net interest margin increased one basis point to 1.90% for the quarter ended March 31, 2025, from 1.89% for the quarter ended March 31, 2024 reflecting a decrease in the average balance of interest-bearing borrowings, partially offset by increases in the average balance of interest-bearing deposits and the cost of FHLB borrowings, and a decrease in the average balance and yield of interest-earning assets.
Current wording
Net interest margin increased 30 basis point to 2.10% for the quarter ended September 30, 2025, from 1.80% for the quarter ended September 30, 2024 reflecting a decrease in the average balance of interest-bearing borrowings, a decrease in the cost of interest-bearing liabilities and higher average balances and yields on loans receivable, partially offset by a decrease in the average balances and yields on other interest-earning assets.
Previous wording
(4)Includes average balances of non-interest-bearing deposits of $602.6 million and $581.9 million for the quarter ended March 31, 2025 and 2024, respectively.
Current wording
(4)Includes average balances of non-interest-bearing deposits of $581.6 million and $599.1 million for the quarter ended September 30, 2025 and 2024, respectively.
Previous wording
Non-Interest Income. Total non-interest income increased $359,000 to $4.6 million for the quarter ended March 31, 2025, compared to $4.2 million for the quarter ended March 31, 2024.
Current wording
Non-Interest Income. Total non-interest income increased $1.2 million to $5.8 million for the quarter ended September 30, 2025, compared to $4.6 million for the quarter ended September 30, 2024.
Previous wording
Non-Interest Expense. Total non-interest expense increased $1.3 million to $30.4 million for the quarter ending March 31, 2025, compared to $29.1 million the quarter ended March 31, 2024.
Current wording
Non-Interest Expense. Total non-interest expense increased $1.9 million to $31.7 million for the quarter ending September 30, 2025, compared to $29.8 million the quarter ended September 30, 2024.
Previous wording
Salaries and employee benefits increased $789,000 to $17.7 million for the quarter ended March 31, 2025. This increase was primarily driven by higher salary expense and payroll taxes from annual merit increases and an increase in incentive compensation.
Current wording
Salaries and employee benefits increased $1.2 million to $18.7 million for the quarter ended September 30, 2025, from $17.5 million for the quarter ended September 30, 2024. This increase was primarily driven by higher salary expense and payroll taxes due to annual merit increases and increases in incentive and stock-based compensation due to the absence of a non-recurring decrease in stock-based compensation recorded in the prior period.
Previous wording
Equipment and systems expense increased $98,000 to $3.9 million for the quarter ended March 31, 2025, largely driven by increases in technology expense associated with the Company’s ongoing digital banking initiatives.
Current wording
Equipment and systems expense increased $114,000 to $4.0 million for the quarter ended September 30, 2025, from $3.9 million for the quarter ended September 30, 2024, largely driven by increases in technology expense associated with the Company’s ongoing digital banking initiatives.
Previous wording
Provision for Income Taxes. Provision for income taxes decreased $517,000 to $1.2 million for the quarter ended March 31, 2025 from $1.7 million for the quarter ended March 31, 2024, reflecting a lower level of pre-tax income compared to the prior year period.
Current wording
Provision for Income Taxes. Provision for income taxes increased $1.4 million to $2.5 million for the quarter ended September 30, 2025 from $1.1 million for the quarter ended September 30, 2024, reflecting a higher level of pre-tax income compared to the prior year period.
Previous wording
Effective tax rates for the nine months ended March 31, 2025 and 2024 were 15.5% and 66.6%, respectively. The decrease in the effective tax rate was primarily due to the absence of discrete tax costs of $5.7 million associated with the BOLI restructure in the prior year period.
Current wording
Effective tax rates for the quarter ended September 30, 2025 and 2024 were 20.6% and 15.1%, respectively. The increase in the effective tax rate was primarily due to higher full year projected taxable income.
Previous wording
At March 31, 2025, liquidity included $126.1 million of short-term cash and cash equivalents and $1.00 billion of investment securities available for sale. As of March 31, 2025, we had the capacity to borrow additional cash funds totaling $2.34 billion, comprised of $1.63 billion and $708.4 million from the Federal Reserve discount window and the FHLBNY, respectively, without pledging additional collateral. We had the ability to pledge additional securities to borrow an additional $86.6 million at March 31, 2025. As of that same date, we also had access to unsecured overnight borrowings with other financial institutions totaling $755.0 million, of which none was outstanding.
Current wording
At September 30, 2025, liquidity included $130.1 million of short-term cash and cash equivalents and $1.02 billion of investment securities available for sale. As of September 30, 2025, we had the capacity to borrow additional cash funds totaling $1.98 billion, comprised of $1.23 billion and $745.8 million from the Federal Reserve discount window and the FHLBNY, respectively, without pledging additional collateral. We had the ability to pledge additional securities to borrow an additional $566.8 million at September 30, 2025. As of that same date, we also had access to unsecured overnight borrowings with other financial institutions totaling $845.0 million, of which none was outstanding.
Previous wording
At March 31, 2025, we had outstanding commitments to originate and purchase loans totaling $37.0 million while such commitments totaled $47.9 million at June 30, 2024. As of those same dates, our pipeline of loans held for sale included $23.0 million and $16.0 million, respectively, of loans in process whose terms included interest rate locks to borrowers that were paired with a best-efforts commitment to sell the loan to a buyer at a fixed price and within a predetermined timeframe after the sale commitment is established.
Current wording
At September 30, 2025, we had outstanding commitments to originate and purchase loans totaling $72.1 million while such commitments totaled $26.4 million at June 30, 2025. As of those same dates, our pipeline of loans held for sale included $21.4 million and $11.1 million, respectively, of loans in process whose terms included interest rate locks to borrowers that were paired with a best-efforts commitment to sell the loan to a buyer at a fixed price and within a predetermined timeframe after the sale commitment is established.
Previous wording
Construction loans in process and unused lines of credit were $93.9 million and $164.8 million, respectively, at March 31, 2025, compared to $75.7 million and $157.3 million, respectively, at June 30, 2024. We are also subject to the contingent liabilities resulting from letters of credit totaling $160,000 at March 31, 2025 and June 30, 2024, respectively.
Current wording
Construction loans in process and unused lines of credit were $137.4 million and $177.3 million, respectively, at September 30, 2025, compared to $115.7 million and $177.1 million, respectively, at June 30, 2025. We are also subject to the contingent liabilities resulting from letters of credit totaling $595,000 at September 30, 2025 and June 30, 2025, respectively.
Rearranged previous paragraphs (14)
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Effective tax rates for the quarter ended March 31, 2025 and 2024 were 15.3% and 18.8%, respectively.
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Comparison of Operating Results for the Nine Months Ended March 31, 2025 and March 31, 2024
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Details regarding the composition of, and changes to, net interest income are presented in the table below which reflects the components of the average balance sheet and of net interest income for the periods indicated. We derived the average yields and costs by dividing income or expense by the average balance of assets or liabilities, respectively, for the periods presented with daily balances used to derive average balances. No tax equivalent adjustments have been made to yield or costs. Non-accrual loans were included in the calculation of average balances, however interest receivable on these loans has been fully reserved for and therefore not included in interest income. The yields and costs set forth below include the effect of deferred fees, discounts and premiums that are amortized or accreted to interest income or expense.
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(1)Loans held-for-sale and non-accruing loans have been included in loans receivable and the effect of such inclusion was not material. Allowance for credit losses has been included in non-interest-earning assets.
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(2)Fair value adjustments have been excluded in the balances of interest-earning assets.
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(3)Includes interest-bearing deposits at other banks and FHLB of New York capital stock.
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(4)Includes average balances of non-interest-bearing deposits of $602.2 million and $597.2 million for the nine months ended March 31, 2025 and 2024, respectively.
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(5)Interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.
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(6)Net interest margin represents net interest income as a percentage of average interest-earning assets.
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Additional information regarding the ACL and the associated provisions recognized during the nine months ended March 31, 2025 and 2024 is presented in Note 6 to the unaudited consolidated financial statements as well as the Comparison of Financial Condition at March 31, 2025 and June 30, 2024.
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The remaining changes in the other components of non-interest income between comparative periods generally reflected normal operating fluctuations within those line items.
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Salaries and employee benefits increased $823,000 to $52.8 million for the nine months ended March 31, 2025. This increase was primarily driven by higher salary expense and payroll taxes from annual merit increases and an increase in incentive compensation.
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Equipment and systems expense increased $235,000 to $11.7 million for the nine months ended March 31, 2025, largely attributable to increases in technology expense associated with the Company's ongoing digital banking initiatives.
Previous report — wording carried elsewhere
The remaining changes in the other components of non-interest expense between comparative periods generally reflected normal operating fluctuations within those line items.