Blue Foundry Bancorp Q2 FY2025 earnings call

• Jim Nesci noted growth in core deposits, net interest margin expansion for the third consecutive quarter, 3% loan growth, and a $22 million increase in commercial and industrial loans year-to-date. Tangible book value per share increased to $14.87, and 406,000 shares were repurchased. • Kelly Pecoraro mentioned net interest income increase, noninterest expense decrease, $29.1 million deposit growth, $47.4 million loan growth, and asset quality remaining strong with low nonperforming assets.

During the second quarter, gross loans increased $47.4 million. Organic growth was in owner-occupied commercial real estate and construction. Purchased $45 million in credit-enhanced consumer loans and $19 million in residential loans. Deposits increased $29.1 million, with $25.2 million core deposit growth. Net interest income increased $896,000 or 8.3% due to a 12 basis point expansion in net interest margin. Interest income expanded $725,000 from loan growth, and interest expense declined $171,000. Provision for credit losses was $463,000 due to unfunded commitments. Asset quality remained strong but nonperforming assets ticked up slightly.

• Kelly expects limited NIM expansion in the back half of 2025, with more significant improvement in 2026. • Targeted consumer loans to be 7%-8% of the loan portfolio over the next couple of quarters. • Anticipated modest increase in compensation expense in the second half of 2025 due to higher variable compensation costs.

• Competitive environment which could impact deposit and loan pricing. • Market conditions affecting loan repricing and portfolio performance.

Q: Justin Crowley asked about loan repricings through the back half of 2025 and into 2026, and details on the multifamily portfolio.

A: Kelly Pecoraro said ~$23 million of loans will reprice in the remainder of 2025, and ~$75 million in 2026, with limited NIM expansion in the back half of 2025.

Q: David Konrad asked about asset generation and noninterest-bearing deposits.

A: James D. Nesci said they are focusing on full relationships with borrowers across asset classes to grow noninterest-bearing deposits.