FLIC - Earnings call transcript Q2 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 Second 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 web page at https://www.cstproxy.com/fnbli/earnings/2024/Q2.

Before we begin, the company would like to remind everyone that 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. actual March a that for Investors ended the refer on March XXXX to list supplemented factors as results XX, XX-K our also XXXX, from cause statements. by or for of materially quarter could risk by should implied filed XXXX, those to X, differ our XX-Q indicated such

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

Christopher Becker

return you. Thank quarter many higher increase items, key higher the and for in improvement Second on First The Quarter net financial income, net lower in including efficiency return financial income, of most and increase ratios interest growth noninterest improvements on of in in and deposits, margin. growth loans, pleased increase importantly, to ratio, earnings share, statement linked Long Good equity, XXXX. line Corporation's in report per Call afternoon, higher in Island Earnings expense, I'm assets, welcome in to noninterest

and quarters ended months the March X.XX% decline interest net the X X ended our margin X.XX% for XXXX, XX, June XXXX. for months After margin X X X.X% consecutive September X the to of XXXX ended XX, XX, from for months to increased

positive certainly for up, not a indicator a move substantial While stabilization.

and improvement this the Managing favorable pace the of mix interest-bearing in interest-earning funding moving we interest to basically of sheet higher, balance the pace this with can is ahead. improve margin what was be not margin the a and net improvement I quarter, that during yield rates with bottom. expected repricing short-term will liability the line curve, of Repeating in mix the believe or coupled significant The quarters more quarter trend second last accelerate. if of augment repricing any at our stated assets in barring our changes continue, year, should

short-term forward. The bank million encouraging approximately closing lower continued weighted second of originations earnings quarter rates for $XX Talk X%. is of rate had average loan the during with stronger growth a moving

originations relationship-based C&I our consumer began to Originations second highlighting quarter during were commercial from the that Second remixing portfolio and owner-occupied driven XXXX. focus quarter our by in business. mortgages, continued progress made on loan commercial the

During relationship-based commercial owner-occupied XX%. C&I that period, increased mortgages other and increased and commercial estate XX%, real

lending resulted XX, June grown our relationship deposits December on XXXX. same improved the business XXXX, our noninterest-bearing growth our million. by commercial represented has our by as $XXX down total, of has funding XX% funding also letting million XX% XX, compared side amortized residential mix lending $XXX mix over to business business in an commercial That In on been the masked at has Building period.

important In the that included note has loans to outstanding. multifamily current environment, I remix any believe significant our to in lending it's increase not commercial

Our up at the end of second from million minimally multifamily totaled end the loans $XXX million of XXXX, XXXX. quarter $XXX the at of

X.XX%. was off the pipeline plus a index million projected many an XXXX approximately the in with XX, until in keep The floating $XXX that are a rate loans June closing. margin pipeline of Please average mind

$XXX first with from move the weighted the it So of end when pipeline quarter the million. average rates increased at The has the market. was

Shareholders' our regard have X-K in additional rate April detailed provided a have supplemented XXXX, X, that on in in on filed presentation Annual information closely been XX, information and resets and We Meeting XXXX. monitoring by Form March

X% a XXXX, commercial we projected the X.XX% of rate have reset of with the of rate rate of multifamily after on During reset. before half as based nonowner-occupied million and average rate a second the of rates this repricing and XX, mortgages year, weighted weighted $XX average June

Looking repricing projected $XXX mortgages and average have reset. nonowner-occupied a million on into rate the of multifamily rate commercial weighted of based weighted of forward average after and we reset the as with a rate XXXX, rate X.XX% rates XX, of June XXXX X.XX% before

reach flow For for cash loans discuss stress, we with have projected started borrowers to out to consideration. their to options

June of Hampton great complement established past levels in of a and criticized, nonperforming we We we East credit presence classified, will location including Long North Our Riverhead, Fork on this as recent Hampton. due, remain Southold. low, rest South East we strong. opened Long our charge-off quality currently the branch of and to believe and a that over and all be the the assess Island XXXX, years, On Island XX,

We branches Queens in and XX Brooklyn. of the Nassau currently Manhattan, Suffolk Counties boroughs covering have and

Our much a XXXX, of high branches over of branch from at approximately down the count efficient period, a more increased XX total deposits our $XXX but have is that end model. by million

existing branch network. continue geographic efficiencies as prospects We well to evaluate our expansion for within as

we been have value. continue a focused on strong XX past months, the opportunities strong franchise. because We over remain credit customer been Our a and have fundamentals challenged building and nearly about of and future build stay for built fundamentals company Growth will around century our to quality but relationships. has shareholder meaningful we optimistic the believe margins

will year-to-date. of now you and highlights the quarter Janet? Verneuille take Janet financial through

Janet Verneuille

you, Chris. afternoon, everyone. Thank Good

an margin return X.XX% of comments, X.X%, from net in some and assets interest from the from included positive to from an XX.X% improvement increase return in X.XX%, equity quarter-over-quarter X.XX%, efficiency on to ratio following: the to to in X.XX% on increase Chris' on X.XX% increase up trends Following on XX.X%.

this stabilization coupled of the of a margin, market heightened September, anticipation can they interest maintain recent are with in Fed be funds cut we trend. expect of to these indicator Although slight trending forward-facing the net our improvements,

quarter The company year recognized and $X.XX, per respectively. of the $X.X June the EPS same were $X.X were share last of $X.XX quarter $X.X net in quarter million income to quarter, million year. second the Directors million for for last declared and and the quarter XXXX, linked dividend of for the our XXXX. for equal linked of for by the $X.XX quarter same per share Board the Earnings

increase in quarter loan largely to effective net benefits provision provision a in in a attributable income provision offset to by in interest incentive million attributed decrease $XXX,XXX in offset tax quarter the million, a XXXX by a by decreases losses, The employee partially second and income loan of is largely $XXX,XXX net the losses. $XXX,XXX decline accruals. from of of employee income was tax the to decrease the in increase and by are earnings These primarily deep expense salaries for due from the decrease attributed interest decrease for and for linked The $XXX,XXX the $X.X the $X lower to partially rate.

million the noninterest Noninterest million merchant card services to and increase. were and of linked income insurance exceeded of results the $X.X the recorded same year million. quarter last quarter life from service deposit Improved of bank-owned in $X.X main $X.X the charges accounts, income on contributors

Management analyst monthly remain $X.X calls income a will deposit approximately million. improvements system had on service service guided in stable. collection recent upgrade, to charge after totals charge management Based quarterly accounts increases in noninterest revenue believes of currently

for the fluctuate, Although XXXX, merchant income revenues these consistent can first quarters X to of card we trend the now expect last quarters. will X service

quarter 'XX approximately compared to have $XX.X of expenses lowered second last rates. during quarters had the open quarter, $XX.XX current to guided year, quarter million will first last in X the totals some X Earlier the staffing analyst quarter We as calls accrual $XX.X expense quarterly million but noninterest million. management also linked incentive the of the expense We comparable million the year. and did an Noninterest totaled to same for positions we noninterest for quarters. compensation in the the $XX.X anticipate be in

loan to $XX about the and million borrowings, second balance growth leading $XX to wholesale small Loan the of deleveraging deposit million though better of During sheet we pay we points reflects a commercial number mortgages, excess of quarter, used by than growth million and overall of million toward $XX $XX loan was million. was of the million. loans growth had $XXX even of $XX down cash was yield The C&I basis quarter-over-quarter. to up offset remix the Commercial $XX we growth portfolio net the as as by mortgages lending. commercial million X.XX% X residential continue decreasing increased loan increased

increase second was interest-bearing certificates in million $XX noninterest-bearing average Average and of million. checking total a cost notable weighted represents X.XX% XX% was non-maturity of and deposits deposit deposits CDs, The quarter deposits. nonmaturity million for $XX of deposits $XX average of interest-bearing saw it The X.XX%. by increased of and

borrowings the of us. repricing of of FHLB market funding, current brokered wholesale largely the behind rates As CDs and remained to second the quarter, close

on slower adjustments Although the we at rate to interest a overall approve upward continue based customer relationship. pace,

Net interest net 'XX of dividends, last matures second to quarter. of to the in to $XXX,XXX swap pay income The increased purchase income quarter and the million compared second the million March of fixed adding quarter for interest floating $X.X in March the XXXX XXXX. same linked decreased continues Swap year. from the $X.X to the quarter of in

same linked for for last for quarter same X.XX% of quarter was X.XX% Our quarter total same and X.X% liabilities for net X.XX% last X.XX% second X.XX% the the for linked quarter XXXX X.XX% Cost for to last the interest the and X.X% quarter total for quarter quarter the margin X.XX% on quarter interest-bearing the the was XXXX, of compares Yield for quarter, second of year. for second linked the of the and interest-earning year. assets year.

The linked the $XXX,XXX credit the of X.XX% of XX, loan of flat and largely the XX, to was allowance XXXX, during remained at at quarter. ACL provision coverage quarterly on net The XXXX, for reserve specific reserve $XXX,XXX charge-offs. to was losses June compared June was Provision $XX.X to The $XXX,XXX as ratio about one in booked million. nonperforming quarter. due

strong market of XXXX. second accumulated remains per unrealized and loss comprised ratio due the Book share comprehensive mainly of XX with higher value repurchases XXXX. interest The The XX, There portfolio rates. XXXX. of June June was available-for-sale XX, capital leverage component is equity securities June of at X.X% $XX.XX versus in to a no quarter position $XX.XX at at share net loss were stockholders' a other approximately

on the rate decreased The a for approximately as effective in the for of to effective quarter with tax the annualized quarter. tax-exempt is due staying of income longer now expected projected was X.X% be X.X% items a The X%. for to linked change to reduction XXXX the rate. tax causing impact XXXX rates The compared than tax to anticipating greater the effective second rate higher

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

Operator

from question Our Fitzgibbon today Piper comes for Sandler. Mark first from

Mark Fitzgibbon

If much margin the think end forward curious I'm Fed you more might how of by cuts this year, back we the be and curve, able the year? the to snap follows X net see interest the

Christopher Becker

that any could that call, indicated XX to we point previous basis X had and each updated further. we X by the in points, Well, margin cut haven't basis improve

that seems So pretty estimate. be a still to good

Mark Fitzgibbon

Okay. the what share that nonperforming charge-offs secondly, here was is terrific, you I curious, what with And but loans? credit, quarter? net uptick were And us in in obviously, then million also drove $X.X could

Christopher Becker

Yes. over went quarter. loan the Net charge-offs were and a took that we a $XXX,XXX it value. appraised the reserve And the charge-off was that's the -- The down nonperforming partial one the had specific charge-off where loan was had $XXX,XXX. -- that little to for about

Mark Fitzgibbon

loan that? of type what is And Okay.

Christopher Becker

That only multifamily our loan multifamily That's nonperforming. was in a loan.

Mark Fitzgibbon

flow All numbers then X% looks I from mentioned real sufficient guys multifamily X.X% at on up of rolling X% to curious, the heard have basically X.XX% those the guess buildings on I done the right. I'm about And $XXX call commercial will cash on be to rate once you sort doubles? sort estate you and of up analysis an whether that the or that's million. nonowner-occupied the that

Christopher Becker

advance collateral of early X customers end their where every cash combine other had that's to of from refinanced and signs reset better one mentioned looked Yes. we've possible that down. by -- had any their we're additional type loans and to what where I that had showing success see of regard. at in We've to to borrower stronger situations cash We've some of and has that's XXXX And showing stress, had the those We've make calculate them cash the had out repricing or loan reaching gotten we stress. pay in one combining do the between overall. flow. flow into maybe repricing help to where strategies stress Absolutely. at We've can X, was flow, situations piece that relieve anything of rate now that's to that the

little would don't that been if months have a and out borrowers early to they So situation receptive reaching a rate or and be they want us get reset the X what there's than obviously, current to option into X bit less a road. at, might a for down especially because say,

Mark Fitzgibbon

it the effective for you then tax the your I rate of had that question normalized be a like all? your will year around around the in was comments I rate. will Okay. sort Janet, what's Like run X%. look last heard And rate What XXXX? for

Janet Verneuille

maybe go X%, I number, but manage assuming will maybe to I'd Well, income probably how rate point, where I to really, tax would don't comes effective because income. percentage about be at know, I say, and a up, it's that smaller items goes obviously, give income don't a on I going will the items. we up, in estimate depend those hesitate tax-exempt this tax-exempt of know, the

Operator

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

Christopher O'Connell

year. provided nonowner-occupied you Just half the wanted multifamily off start repricing CRE second into the and of to with

of and the in nonowner-occupied of the half 'XX? first much how curious Just repriced multifamily

Christopher Becker

it's I it -- similar similar in of in me. number was that was repricing have right going what's the to to on very the don't second in half. but second. it front what's Yes,

Christopher O'Connell

it. far half I up Got left upwards much do second year? CDs to mean the the side probably how funding of as more goes, the And with close as reprice think this at has point. market are rates you in to pretty

Janet Verneuille

little at they're far as brokerage much There's that a the had bit. And the CDs, piece pretty We low reprice market market. minimal it's retail on to was just rate that to one left small I very rates. repriced at say what's would side. as a

Christopher O'Connell

Got it.

did earlier just on of the repricing, of the borrowings, decent year have why not the positive well like in curious I in on rate seems the amount CD sheet? when more as interim of now So mean and other margin kind balance the you especially little bit begin that a given as asset the I'm between it cuts repricing side because a similar

Christopher Becker

Yes.

still second we even right, balance And think accounts. I the as sheet. it far at deposit both the as well money looked as quarter, our on we pretty we the market on was nonmaturity in side of priced what sides have

quarter. still still in still those have for second little this. and we still cautious those that's had I You some numbers still that's closely why the second We're one-off And at think quarter. we're the being us looking on discussions, those, went there's relationship up the -- rates a throughout increase where but in

Christopher O'Connell

Are the quarters, sounds for plan of are on like residential up, inclusive it. single-digit net And you of growth, the thinking still loan it runoff on the Got couple this pipelines low improved past good originations. growth year?

Christopher Becker

Yes.

Christopher O'Connell

into back net lead to And environment, the if you're loan getting XXXX? as towards into you or -- for there's residential get of kind 'XX less continue of pressures rate-cutting will if to that that XXXX, moderate a do think and growth funding half getting is into we strategy higher

Christopher Becker

begin of plan We to towards residential mortgages. plan will don't It We don't We them begin continue. to second stopped the half originating originating originating year. last them.

we on commercial continuing the really owner-occupied grow some portfolio, mortgages. but the consider relationship and we we Now to in want to may wanted loans have C&I to base purchasing if diversification focus

at handful the while from occupied kind of like of now. other C&I it's like then pie real owner look equal you XX% still X% years estate -- about buckets X of multifamily, ago low and up smallest relationship of of loan Ideally, and kind so residential. to portfolio or slice that's a If commercial we'd chart, our

to that pie. pieces go if X residential. we at get to look I buying ways quarter, And at would those you as a said, consider, has still the point, residential the So down possibly that to some of

Christopher O'Connell

is tight, a if on just of book you the have that as reached then And you any to the basis and percentage how helpful. customers even that what big either said amount, sense the of ballparking? customer a in or That's look dollar out of multifamily on it. segment guys it's ones Got kind

Christopher Becker

remainder I X of can you, loans. year, tell Yes, it's the for -- it's this

So it's a small of borrowers. number

Christopher O'Connell

more conversation? overall think as And year comfortable you with of you up the the to XXXX. half little bit the revisit start you Do the profitability start like the back guys into buyback see and Great. profile to here come and a margin earnings in get

Christopher Becker

we quarter that, that the look we buyback still certainly along of have we million make and dividend But program that's Yes. in I year. the something. quarter buy something have think certainly under decisions. with That's those some back I this we first mean every did stock outstanding. $XX the at

So that. absolutely, we would at look

Operator

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

Christopher Becker

today. and the you to continued dedication shareholder We the remain on employees making for Enjoy Thank Yes. decisions to communities. the for right call customers participation attention and thank on upcoming term. over value the service increase their our your I long our weekend. focused

The First of Long Island Corporation (FLIC) 26 Jul 242024 Q2 Earnings call transcript