Dime Community Bancshares, Inc. /NY/ Q4 FY2024 earnings call

• Hired deposit gathering teams from Signature Bank, raising ~$1.8B core deposits and opening over 11,000 accounts and 7,000 customer relationships. - Grew business loans, with C&I and healthcare driving growth. Reduced wholesale borrowings and brokered deposits by ~$1.2B. - Kept core operating expenses to assets in 165 basis point range using technology. - Raised ~$136M from common equity offering, repositioned securities and BOLI portfolios. - Received consecutive outstanding CRA rating with perfect scores in lending, investment, and service components.

Core deposits: The company hired deposit gathering teams from former Signature Bank, collectively raising approximately $1.8 billion of core deposits with ~40% in non-interest-bearing deposits. Loan-to-deposit ratio ended below 95%, and wholesale borrowings and brokered deposits were reduced by ~$1.2 billion. Loans: Business loans were up over $70 million in Q4 and $400 million for the full year, driven by C&I and healthcare verticals. Loan pipeline over $750 million with a weighted average rate of 7.75%. CRE concentration was ~45% and expected to reduce. NIM: Fourth quarter NIM increased to 2.79%, with potential to return to a 3% plus net interest margin due to back book repricing.

• Non-interest income: $40 million to $42 million for 2025, influenced by BOLI restructuring. - Loan growth: Low single-digit in 2025, back half weighted, with focus on reducing CRE concentration. - Core cash non-interest expenses: $234 million to $235 million in 2025. - Tax rate: Expected to be between 27% and 28% in 2025. - NIM: Target 3% in 2025, >3.25% in 2026, approaching 3.50% in 2027, driven by back book repricing.

• Disruption in the marketplace and potential increased competition. - Uncertainty around Federal Reserve rate cuts and their impact on NIM and deposit competition. - Challenges in managing CRE concentration and loan payoffs.

Q: Follow-up on non-interest income guidance for 2025 A: Non-interest income guidance is $40 million to $42 million, influenced by BOLI restructuring with additional income from BOLI purchase in January.

Q: Loan growth guidance A: Loan growth expected to be low single-digit in 2025, with back half weighted, and CRE reduction ongoing, expecting mid single-digit growth in 2026 Q: CRA rating and acquisitions A: Interest in strategic opportunities to enhance franchise value within Tri-State area, considering organic growth and capital support Q: Margin guidance and deposit competition A: Monthly December core NIM was ~2.84%, first quarter NIM expected around 2.90% with potential upside from core deposit growth and loan repricing; marginal deposits come from mix of DDA and money market, with blended cost around 2-2.5%