FLIC - Earnings call transcript Q1 2024 | The First of Long Island Corporation

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Welcome to The First of Long Island Corporation's First Quarter 2024 Earnings Conference Call.

On the call today are Chris Becker, President and Chief Executive Officer; and Janet Verneuille, Senior Executive Vice President and Chief Financial Officer.

Today's call is being recorded. A copy of the earnings release is available on the corporation's website at fnbli.com and on the earnings call webpage at https://www.cstproxy.com/fnbli/earnings/2024/Q1.

Before we begin, the company would like to remind everyone this call may contain certain statements that constitute forward-looking statements made under the safe harbor provisions of the U.S. Act Reform Litigation Securities of XXXX. Private set are that may statements those U.S. in including subject with company's differ to factors other contained as statements, such and uncertainties any in cause the from the filings risks, materially Such forth actual to results Exchange and Securities Commission. statements. March materially implied factors Investors cause that refer on actual XXXX from a or for results XX-K our also XXXX such list differ those could by indicated should filed to to X, of risk

would turn Chris I to Becker. to like call over now the

Christopher Becker

you. to Thank for The of Long XXXX. Good quarter first call earnings First afternoon, and welcome Island the of Corporation's

last the Just fnbli.com replay that of held topics interest. key curve Meeting Stockholders improving Please an presentation. visit of It benefits of website technology our and challenges, to organization, our Relations and many of Annual yield our covered week, earnings current strengths the the the recent the number of key we focuses causes a of how can Investor our page performance, lift on upgrades.

liquidity supporting of its and initiatives moderate being as day-to-day strengths, a lender a discussions source reports potential capital and Home with an York eliminate end March are of for housing the X.X%. as liquidity the of The of source the especially of remained ratio a for appropriate both at had role at working of income versus charter borrowings XXXX Bank needs. System's Federal resort, with the the collateral common with New banks. a strong of and quarter of We ample our Bank the we Loan to primary of both Loan Reserve Federal believe XX% liquidity XX, low Bank the equity regarding stigma last recent ratio first Reserve is tangible $X.X of leverage Home billion on and for on Bank, balance Focusing Federal Federal

and of loan year-end, at in by activity X% from owner-occupied XXXX mortgages, million up recent yet including million, commercial loans, we C&I that pipeline are is $XXX increased XXXX. since XX, Our reflected March year-end $XX not encouraged our

remained basis total XX, XXXX, and single-digit a through quality with percentage points at past credit charge-offs, loans as loans due rock remaining of Our nonperforming loans. March solid

and Noninterest a $X.X of XXXX. in slightly good ahead had below income expense first our million quarter quarter guidance million guidance $X.XX was was quarter of of our XXXX. slightly Noninterest in per per

We have growth. a new technology future our to platform support

and in East Long our are quality, during We continuing adding X opening the a our a time fourth relationships, and news And good bend not this we banking difficult on are of disciplined focus world, the we being staying base history year, bad on banker loyal growing branch long-standing looking through that momentum Island a the keep end credit to of has We in want we deposit way. to quarter at on that area. of and our second relationship build do environment. it in

mix lower As XXXX of drop funds as average largely quarter of deposits our the to the approximately the was to quarter our to margin funding fourth XXXX. The million of XXXX. interest quarter average related was average comparing net anticipated, first from $XXX shifted in when first wholesale

reprice of from X.XX% average $XX.X also We had million funding to of wholesale X.XX%. a cost weighted

quarter. to XXXX tax loan as $XX.X are in March higher throughout tax down were fourth monthly when and municipal real to during at the the in Regarding payments, the quarter $XX.X Escrow escrow deposits make XXXX, linked used deposits the Municipal deposits estate deposits were payments were received. year of build million drop $XX.X million. compared million XX, back deposits

and made every municipal municipal fourth deposits fluctuations tax X fourth The quarter quarter. Real estate our the by fourth of down million. payments in tax and of last an are in average bank been the years quarter deposits $XX.X have in in are the escrow the for X common year

relationship the note Our quarter, while lower consumer first remained and of commercial quarter. by deposits XX% were quarter-end year-end at end million. deposits were and that higher stable, the average deposits deposits deposits Please than XXXX during total over of $XX noninterest-bearing the were checking

As rates. the not any to of significant quarter, end of that funding, close the first are no of there market or including CDs wholesale at tranches are brokered

market approximately CDs and May million retail next estimated at are XX $XX XX reprice maturities XX rates, X% are maturing Our and current after in are that paying basis months in largely over to April expected close an to to the at especially higher. very points

our in moving bottom. margin mix short-term the should changes be we significant any our at or higher, rates Barring funding believe

expect in the the second half or will funding more narrow fluctuate improvement a band We our XXXX, margin for curve of although in a yield remainder continued it within the may favorable mix improve year. of

quarter. first Verneuille Janet take through now financial Janet? highlights other will of the you

Janet Verneuille

income Thank was company $X.X million to quarter net in of $X.X everyone. attributed down of quarter largely The first interest losses The quarter of you, XXXX. in credit million, partially the for the in sale net afternoon, decrease by provision Good XXXX. recognized income first XXXX, million of Chris. from XXXX, million securities loan offset $X.X for of lower on $X.X first a million of of the $X.X loss the

quarter. of lower That was of the employee benefits result linked and million income mainly interest decrease million to income linked million net the of accruals was in taken $X.X due also increase Net an and in reversal salaries the incentive quarter. in of down the $X.X $X.X

noninterest $X.X XXXX XXXX, $X.X million. The quarter's first $X.X quarter noninterest million. both comparisons. loss quarter linked excluding of of total charge of accounts and service on income million securities noninterest exceeded quarter helped the the income the income also After on of of the in sale BOLI Better in deposit exceeded income recorded in income

lot expense of as not the so of a of comparison had noise or $XXX,XXX meaningful. first is reversal decline quarter accruals, compared the linked to million, $XX.X which The XXXX. the related totaled is Noninterest quarter X.X% of a incentive to

our $XX.X mortgages lines. equity loans from prior declined This amortization paydowns offset to decline related the was commercial $XX.X mentioned. continued home basis quarter-end, of of mainly of for in million portfolios, from and million of linked was quarter by X points a loan overall growth the Chris the and first other X.XX%. The X.XX% yields XXXX loan up was Gross residential quarter; yield as

Total noninterest-bearing deposits out deposits interest-bearing increased of year-end. and customers as into $XX.X checking The mix to move million from continues alternatives. of change accounts

down million were deposits average quarter. mentioned, linked Chris $XXX from the approximately As

million quarter, quarter linked as of quarter averaged supplemented first was quarter X.XX% drop X.XX% the and the the The for the was of the X.XX% The X.XX% by was advances. the of for of first X.XX% average first cost for of deposits Other of partially borrowings linked $XXX.X first and cost in these the quarter first for average XXXX. in in deposits the XXXX, these XXXX, in X.XX% XXXX. quarter, borrowings quarter

of net of the assets pace margin the to of the income the the XXXX and of continued of impact balance first quarter on above side the the income of the line, portfolio the reflects yet above. interest statement repricing outpace continued the fixed-to-floating described sheet a Net liability investment repricing swap balance of quarter interest repositioning the the securities portion and the challenges purchase the to sheet. of in for positively first the The the

quarter linked calculated the of from million first from interest net XXXX. in X.XX% first quarter first and on and the in for income declined the Net the quarter The XXXX, X.XX% earning X.XX% of in XXXX. linked quarter, and quarter $X.X yield $X.X million first the XXXX first in the the The total assets the the in of XXXX, of to XXXX. of quarter X.XX% first quarter, was interest X.X% margin in X.X% quarter of quarter linked

in total allowance quarter. the and linked XXXX. was to the XXXX, liabilities X.XX% is for credit provision quarter, first during first quarter the quarter of losses X.XX% booked interest-bearing the No Cost X.XX% of in the of in

The estate Bank real York market New Community under problems the disclosed New heightened commercial XXXX. metropolitan by the of year-end York scrutiny, at especially in in credit wake area, remains

the State legislation XXXX, metropolitan York New multifamily estate ripple the is Stability passed in market rent-regulated affecting New the of negatively Act impact real the Protection York Although Tenant in the most and recently, area. Housing

portfolio, XX, portfolio, furnished on believe coverage XX, XXXX the recent Book XXXX. value versus remains March multifamily on credit on on is X, We presentation. loan reserve XXXX points, CRE XX The of quality basis $XX.XX provided meeting March an detailed $XX.XX ratio our XX, basis annual to our year-end has March XXXX at strong. disclosures on was X-K March Management our in portfolio compared and per including XX in the XXXX. points share

portfolio The comprised rates. in of accumulated component the the higher mainly interest stockholders' the equity loss comprehensive net loss unrealized a market securities of due to other available-for-sale is

quarterly first share. million, XXXX the the of during $X.XX dividend cash and quarter per of declared shares Bank company The a cost repurchased its at $X of

XXXX assets larger of as X.X% The effective were tax the bonds our taxable in rate a for the quarter of was during of BOLI income tax-advantaged subsidiary, quarter. portion and REIT municipal the loans first

our With questions. for it to back operator turn that, I

Operator

for comes at Our first today Sandler. question Twerdahl Alex from Piper

Alexander Roberts Twerdahl

the Chris. outlook, on loan First,

loan however, of a small talked the quarter commercial pretty It's You a about and little you bit growth pipeline the pie. percentage still, overall building. that saw this

over just loan commercial as So for percentage sort and time and to book. where us portfolio opportunity I the the a frame overall get help eventually maybe overall, was the you it that, think outlook the can of hoping of might you

Christopher Becker

commercial have over portfolio. the of -- total which The real well, C&I portfolio the and is the portfolio then let's was obviously, So And the portfolio. commercial right? down, at it portfolio, estate break of XX% half owner-occupied we

XX% certainly to the And the portfolio, real want owner-occupied C&I the we is. with -- of estate residential in the pie piece over is -- is portfolio that we're come which the happy where We down. and still size side, like we piece want So grow. we the to still of commercial the of piece

in X the look say get can some to pie, it's about not owner-occupied time, some owner-occupied. in take I'd But look equal you're love certainly months. when multifamily, to to it's going If C&I to CRE, But talking that's about moving. And -- residential, slices. I time in I see there. direction love and other forward to and years, XX% we're I'd XX% going XX% see C&I take and XX% at the about for in and about that

hired another market And we've just lender. middle

team past activity some over middle we've know, picking the our market X you is and years, up As there. grown

pipeline little And the that, quiet. keep You we is want a but been up has bit quarter-over-quarter. growing to see activity our

are that. rates impacting The obviously

the side, and do some not that. but rate often loans everybody the of on banks, the estate -- interest estate environment, have current because the real other of side, rightsized to opportunities Some willing to be from quite commercial real is we're seeing

shrinking banks a does growth remain bit. rates that's it out the and and challenging So little low there, very see in some you industry why

Alexander Roberts Twerdahl

mean, for guess growth and the equal the just that I the to those level grow slices running loan the are Yes, time, there, think to when do against take and over call? while get as see think a payoff overall Or activity a in the totally this sort X at about kind kind makes book? well? going you sense. loan earlier book of as that to year keep it you and of of you does amortization current about sufficient to And I being a they loan it's you overall pipeline, flattish book loan the alluded opportunities, get, that

Christopher Becker

in related though I the not side. the mainly the bit year, thinking payoffs for commercial growth even a still We're residential so. low little quarter, first we in single-digit the portfolio, on to were down think

talk our you and/or -- more are in our or a about and earnings look in when state we in them, on quarter, pipeline then numbers releases, the closed So we much you other. numbers with each about talk press where depending look we what at calls line that at earnings our in

a pipeline they're decides there bit to then And bank disconnect. to And their hear a not a some little bit I every little I be, differently. large. see I are large, for of disclose numbers very the very pipeline think how me, of numbers banks quarter, but seems that closings to

that way and our everybody When have getting looks and loans those to are to look credits we of pipeline, upon, But close, high they signed think closing. already are approved look we that's I at and obviously, a ready agreed probability just at very that and LOIs we look and vetted at the it. closely, we've at,

conservative looking bit think lower side why I probably which way report looks probably a it, than is our little we some on at it the So a number, is more little maybe bit others. the

Alexander Roberts Twerdahl

color. Thanks Understood. for that

know what repricing the kind I less as today, securities it some pretty against sort of As some stuff you you necessarily new borrowing there's you're of, that of out that on be sheet going -- have to the and super look you balance but I not going capital think, portfolio, today clear I to get efficient and leverage cheap on is it's through the on mean a position. Janet, at healthy of coming is

So year do of restructuring how come get as rid or using you that you to last think weigh leverage that today, to and -- of about either similar is right upside-down capital to did what else, some you similar something maybe now? some

Janet Verneuille

see We various out. if at have the to scenarios it look makes modeled usually sense. payback We period

securities it as We have we consider, just some we go liquidity, the make putting and But first some didn't sense. will with maybe quarter, investment forward, room on. for

Christopher Becker

a X at, we monitor that. don't that makes start on or years, if the at securities both We earn-back of side. of look sense. to out The X on periods we looked things we that to you loan lot think But and continue getting some the

Alexander Roberts Twerdahl

get over year I the or the the next accelerate of could cash do that that something sort today X just Are Yes. there of a or us mean see average you boost to flows portfolio and weighted -- totally near-term could a you NIM? to that securities life shorter give it. have pieces are

Janet Verneuille

that, the -- look I look I but of the we'll longer, down, to at the investment would but paying pay munis nothing CMOs. some are Not we moment. when at that at mean continue mortgage-backeds say the portfolio there's

Christopher Becker

lot to at our in portfolio. X.X%. is coming lot underlying There's not if of the a The prepayments the mortgage underlying loans or in residential a portfolio; is similar mortgage-backed mortgage-backed of portfolio the X%

Alexander Roberts Twerdahl

Yes.

put looking weighted in your service the debt deck Okay. I guys I liked the in wanted really was to at thanks which pretty the and for you information. -- slide giving -- reset respect to and that's all with is the disclosure helpful, in average seen after of so 'XX for ratio resetting 'XX, a us lot that coverage haven't of stuff some and that, multifamily,

the I net was what kind of service, of but often and operating maybe fingertips, properties of just and do in the the interest the wondering to in your terms we some if income you these going at had the don't, you rates are starting year sort debt guess for both do and of of come piece you for the the for or the down market, debt to service a whether X? that about regulated do NOIs or you sense free ratio? have how the coverage those in equation are not next Or think

Christopher Becker

coming I don't when we're when have And because down are opportunities or specific for triple -- reviews, I numbers for -- mean inflation. you, you're booked. looking but new reset, I we've the on do areas, loans annual seeing insurance of just that seen was looking at loan at see down. up the NOIs coming NOIs insurance certain we're loans a some doing rate we're utility since expenses, rates are originally

So the is right? challenge, also side a expense really

rent-regulated But flow, some if in see look that a expenses. on the related at have it's higher like properties properties rates the When they do to interest stress that multifamily, about you and of lot cash reset the may have you think more you space.

necessarily the not regulations and passed. the it's that to to XXXX So legislation was related

Alexander Roberts Twerdahl

Right.

Okay. I them, at you think feel service magic that debt sort you when underwriting coverage and comfortable mean guess about these on I of number guys with? what ratio resetting a things then

Christopher Becker

lot X.X if provide book policy, we've you -- you about X.XX. and at you'll obviously we mean down of information average we and to a look we go book maybe that I of on consistent Meeting coverage weighted things stuff, new in service talked put it and it's where there if X-K. about if the things, listen, Well, And look and Annual the debt XX% our both the reality, at that's average and times guidance with But LTVs. out ratio generally at we it, --

So room. of you lot that leaves a

service in what And that 'XX information was XX Annual debt when at to the in, at March strong when shape. at in our we ratio. a assuming we coming coverage a ratios And look put all it were resetting -- and basically was what assumed -- the new about debt in that they X.XXs Still looking additional we the X.XXs. loans, seriously, certainly loan if year, this all the other 'XX, the a reset good the also and of from went service metrics coverage talked Meeting we would

But looking a service at to write at a about coverage the those So you -- and if debt ratio, minimum debt ratio coverage changes, basically drop right, okay? were that's XX% have in difference. loans banks service

a X.XX that you're had for we 'XX it it, about and ratio X.XX, book the minimum you and a kind the decrease XX% Some if loan some seeing showed then that But if that on have service go at a X.XX, on booked was did 'XX, loan full and to of coverage across you X.XX, and time what you X.XX. debt board of would from you average held down at X:X.

covering would a obviously but be their to of it situation, stretched would cover would they would cash itself. but be just excess more borrower, the it for no able be expenses. flow There be So

And type So seems for rates properties. that number where it's that's be is of are at because I looking is the kind seeing, everybody guess falling. same and everybody at consistent things throughout industry, the pretty of -- probably XX% kind the the same what of kind from us, looking would of we're to threshold

Alexander Roberts Twerdahl

color, helpful appreciate all Chris. really comments. I That's the

Christopher Becker

it. Appreciate Thanks, Alex.

Operator

Chris question next KBW. comes Our O'Connell from at

Christopher O'Connell

for in. strong coverage at anything XXXX really, like that? high multifamily almost rate there slide It in -- market that the debt like to just the be the of resets discussion, before X.Xx. it seems kick X really up the unusual Is ratios, Following service free on it shows

Christopher Becker

the -- way on to going it's certainly nothing not mean look that it's some and in have unusual we're segments X.XX, some be portfolio, pretty number. entire X nothing and unusual CRE I there's and underwrite, you our is we I it's above to mean when there on consistent below. at overall that. No, portfolio, the unusual

Christopher O'Connell

you us pipeline to circling the And what that it. loan can overall give Got . yield just then million growth discussion, is? back the on $XXX

Christopher Becker

The tell X%. are the just of until because quarter of X%. about always index floating quarter, first basis was first of I the lot few within off the tough But is the points them can for yield pipeline they a you, closings It in close. an were on a

the I know that, changed downs So that an but we've haven't ups treasury too pretty that fact some I'm be exact on shouldn't it that. curve, number but seen number. the it's rates to X% to much, based don't probably close and from have But I in on different say going the

Christopher O'Connell

the remainder separate for of the months, on next just you it. do Got maturing what either us amount or I know but the are, then and XX of but have And you balances basis, last gave dollar each? combined the of quarter, securities, or repricing loans think, I year the

Christopher Becker

and I on So paying we've million loans necessarily paying know up, and amount. than have down moving right, what's I in around. $XX in put you is the we put that's in. cash of don't but credit not out about the what total generally million to look the again, C&I side, at you multifamily repricing, on Because what when there -- have have lines portfolio, CRE coming repricing flow don't repricing. coming have quarterly I out flow quarterly we've other $XX cash that's

can't always use fluctuate. usage tell when quarter-to-quarter, and you little the be that or up does from bit going be line a down to -- when So the is

can that have don't to better you. I that's specific next the put for on for quarter But that. something together So numbers we try

Christopher O'Connell

the being guess NIM May tepid repricings, be what this borrowings second less going the is improvement, getting the or year, Yes, quarter, past conservative are or I'm thinking getting to we some will up do the think get side, these a back about CD quarter second to the going more on final the no of more you're after fully in I end CDs little to you slow, half and seem be it reprice, you and and asset of April the at are with is, seems be pretty NIM fully you much with year? the although going repriced, problem. like the bit of rebounding just

Christopher Becker

whenever back. come because think I not seems to being conservative, we're you're conservative, something

going the don't Just be rate this to market thought was going right? X year. So what certainly know others be going to the you, until now maybe there's doesn't saying or like maybe X, there Fed they're everybody going thinking is we into decreases, that happen something, have was or it next any, but or saying and still X to do if year there's

have out a do little get conservative, money of you the in mix you DDA. you'd a So some unexpected and bit, do changes still then then moving little have

we is when say, some if stuff, margin There's But up. said, really get wholesale overall significant. move rate you CDs, things funding, the there, conservatively, our right? being nothing we and So the hey, liability and relief repriced, see cost able real side, side, on CDs, here largely we brokered good mix the we've any to look the little the that I few mean as a higher but at retail is

repriced. that's So largely

about And in but moved have past look at you when basis an money and you to down our quarter they've a about points those at first year. accounts, year, numbers basis when the been go up, When average points see to go those this nonmaturity a you of a tables decreasing for our XX X pace. savings to can first deposits, several back down from of at market last continuing month month the quarters of quarter now, we look numbers the NIM

we to on, say, that and then look flow in the talked a a extra to $X.X million how coming if going is quarter of, in, we And that if to that that about and $XX potential That to X%, cash simply a going asset because million coming number there, to right? our deposits, at up, taking nonmaturity that on saying repricing at $XX apply, be coming side, on just at use look on than for are cost that if and look or X% and X.X% on loan X%, securities. currently So in it's much loans we repricing going a X.X% larger when that and and small there's argument's it's about repricing interest where upside you group we much look you number. you sake, of and assets well, the that billion, at reprice be, say,

And that that the that nonmaturity so something little deposits that continue. we believe fairly bit. points could trend coming well could down basis coming a from happens, But month a time, down XX consistently in period to X, of been up it's that if go very over back it

be higher we than see expected -- When we're is do -- would unexpected So in numbers. points little. was on upside. just and from being the have right? leans down the go now where there. mix basis went That unfortunate it it in quarter had you which But margin change as would to it quarter, always a conservative say to be, may what's unknowns repricing seems we XX -- the to this I had I now the towards But had pressures end But boil really there's down. down you we we I first the the the always think side there correcting it of in quarter, quarter-to-quarter. every We an

Christopher O'Connell

a shares bit quarter. back little Understood. of And you guys this the just on position, bought capital

it continue think a quarter. from the will that little buyback on you last here? Is you were something You cautious

Janet Verneuille

in We on take would it a the quarter. we upcoming consider sure, buying depending capital position, look the for at back shares, every And months.

Christopher O'Connell

tax And what's then last just, Great. a one go-forward me good for is rate?

Janet Verneuille

came the We're guided a max in as of XX% benefit know the beginning REIT. tax on starting I to to X.XX%. out the Well, year, at at we we

at So up, middle year. guided I and the be is would say XX% tax in going the do of somewhere beginning the I the think the rate that X.XX% of the to going we

Operator

closing Thank to you. for floor turn question-and-answer I over Chris session. our Becker concluded the back will comments. This

Christopher Becker

the and Have And participation your rest to end for Yes. everybody today. call on a forward talking Thank day. the look at good quarter. of attention you the of the to we second

The First of Long Island Corporation (FLIC) 26 Apr 242024 Q1 Earnings call transcript