Flushing Financial Corporation Reports 3Q22 GAAP EPS of

Loan Growth Despite Rising Rates

John R. Buran, President and CEO Commentary

UNIONDALE, N.Y., Oct. 25, 2022 (GLOBE NEWSWIRE) — The Company reported third quarter 2022 GAAP EPS of $0.76, down 6.2% YoY, with a ROAA of 1.11%, and ROAE of 13.91%. Core 3Q22 EPS was $0.62, a lower of 29.5% YoY, with a ROAA of 0.90% and the ROAE of 11.24%.  

Loan Closings up 90.1% YoY; NIM Declined QoQ. Period finish web loans, excluding PPP, elevated 3.1% QoQ, with balanced development between actual property and business business and different loans. Loan closings, excluding PPP, had been up 90.1% YoY, whereas compensation speeds declined each YoY and QoQ. Despite the mortgage closings growing, web curiosity revenue of $61.2 million decreased 3.4% YoY and 5.4% QoQ, primarily as a result of elevated funding prices. NIM FTE was 3.07% in 3Q22 in comparison with 3.35% in 2Q22 and three.34% a yr in the past. Core NIM FTE decreased by 24 bps to three.03% YoY and 30 bps QoQ. The Company employed 46 folks, together with 20 income producers, since March 31, 2021 from establishments concerned with financial institution mergers.

Returned 40% of Earnings in 3Q22; Tangible Book Value Per Share Increased 3% YoY. The Company repurchased 131,174 shares of widespread inventory at a mean worth of $20.47 in the course of the quarter. Book worth and tangible ebook worth per share had been $22.47 and $21.81, respectively, whereas TCE/TA¹ was 7.62% at September 30, 2022 in comparison with 7.82% at June 30, 2022.

¹ Tangible Common Equity (“TCE”)/Total Assets (“TA”) ² See “Reconciliation of GAAP Earnings and Core Earnings”, “Reconciliation of GAAP Revenue and Pre-Provision Pre-Tax Net Revenue”, and “Reconciliation of GAAP Net Interest Margin to Core Net Interest Income and Net Interest Margin.” ³ Net Interest Margin (“NIM”) Fully Taxable Equivalent (“FTE”)

• Period finish web loans, excluding PPP, elevated 3.1% QoQ and 6.8% YoY; mortgage closings had been $463.7 million at 4.60% in 3Q22, down 8.0% from report ranges QoQ, however up 90.1% YoY whereas the yield elevated 68 bps QoQ and 96 bps YoY
• Loan pipeline decreased 41.8% YoY to $309.1 million as we grow to be extra selective in phrases of charge and collateral sort and debtors adjusted to increased charges
• Issued $65 million of subordinated notes at 6.00% in the course of the 3Q22
• NPAs elevated to $50.0 million from $48.9 million at 2Q22 and from $20.2 million at 3Q21
• Provision for credit score losses was $2.1 million in 3Q22 in comparison with a profit for credit score losses of $6.9 million in 3Q21; web charge-offs had been $0.3 million in 3Q22 in comparison with web recoveries of $0.6 million in 3Q21
• Net curiosity revenue decreased 5.4% QoQ and three.4% YoY to $61.2 million; Core web curiosity revenue declined 6.2% QoQ and a couple of.7% YoY to $60.4 million
• Net curiosity margin FTE decreased 28 bps QoQ and 27 bps YoY to three.07%; Core web curiosity margin FTE decreased 30 bps QoQ and 24 bps YoY to three.03%; The decline in GAAP and Core NIM QoQ was primarily pushed by our legal responsibility delicate steadiness sheet leading to liabilities repricing quicker than belongings over the close to time period however reversing as loans reprice over the subsequent couple of years
• Average deposits, together with mortgage escrow, decreased 2.6% QoQ and a couple of.1% YoY to $6.3 billion, with core deposits comprising 83.1% of complete common deposits
• Signed a lease to open a brand new department in Brooklyn increasing our Asian banking footprint
• Tangible Common Equity to Tangible Assets was 7.62% down from 7.82% at 2Q22; the change in collected different complete loss, web of taxes (primarily from rising charges) impacted this ratio by 18 bps in 3Q22 in comparison with 2Q22
• Repurchased 131,174 shares at a mean worth of $20.47; dividends and share repurchases had been 40% of web revenue in 3Q22

¹ See Reconciliation of GAAP Earnings and Core Earnings

Net curiosity revenue totaled $61.2 million in 3Q22 in comparison with $64.7 million in 2Q22, $63.5 million in 1Q22, $62.7 million in 4Q21, and $63.4 million in 3Q21.

• Net curiosity margin, FTE (“NIM”) of 3.07% decreased 27 bps YoY and 28 bps QoQ
• Prepayment penalty revenue from loans and securities, web reversals and recoveries of curiosity from nonaccrual loans, web beneficial properties and losses from truthful worth changes on qualifying hedges, and buy accounting accretion totaled $2.2 million (11 bps to the NIM) in 3Q22 in comparison with $2.6 million (13 bps) in 2Q22, $2.6 million (14 bps) in 1Q22, $3.1 million (16 bps) in 4Q21, and $3.4 million (19 bps) in 3Q21
• Excluding the gadgets within the earlier bullet, web curiosity margin was 2.96% in 3Q22, 3.22% in 2Q22 and in 1Q22, 3.13% in 4Q21, and three.15% in 3Q21

The Company recorded a provision for credit score losses of $2.1 million in 3Q22, $1.6 million in 2Q22, $1.4 million in 1Q22, and $0.8 million in 4Q21 in comparison with a profit for credit score losses of $6.9 million in 3Q21.

• 3Q22 provision for credit score losses of $2.1 million was primarily on account of elevated reserves on two beforehand recognized credit and mortgage development
• Net charge-offs (recoveries) had been $0.3 million in 3Q22 (2 bps of common loans), $(0.5) million in 2Q22 ((3) bps of common loans), $0.9 million in 1Q22 (6 bps of common loans), $(29) thousand in 4Q21 (negligible as in comparison with common loans), and $(0.6) million in 3Q21 ((4) bps of common loans)

Noninterest revenue (loss) was $9.0 million in 3Q22, $7.4 million in 2Q22, $1.3 million in 1Q22, $(0.3) million in 4Q21, and $0.9 million in 3Q21.

• Noninterest revenue included web beneficial properties (losses) from truthful worth changes of $5.6 million in 3Q22 or $0.13 per share, web of tax, $2.5 million in 2Q22 or $0.06 per share, web of tax, $(1.8) million in 1Q22 or $(0.04) per share, web of tax, $(5.1) million in 4Q21 or $(0.13) per share, web of tax, and $(2.3) million in 3Q21 or $(0.05) per share, web of tax
• Life insurance proceeds had been $1.5 million ($0.05 per share) in 2Q22
• Absent all above gadgets and different immaterial changes, core noninterest revenue was $3.4 million in 3Q22, up 6.4% YoY, and a couple of.6% QoQ
• Included in 4Q21 core noninterest revenue was a one-time $2.0 million ($0.05 per share, web of tax) dividend obtained on retirement plan investments

Noninterest expense totaled $35.6 million in 3Q22 (a lower of 2.0% YoY, however a rise of 0.3% QoQ) in comparison with $35.5 million in 2Q22, $38.8 million in 1Q22, $38.8 million in 4Q21, and $36.3 million in 3Q21.

• Other working bills embody $0.6 million discount in reserves for unfunded commitments in 3Q22
• Included in 1Q22 noninterest expense was $4.3 million of seasonal compensation expense; 4Q21 noninterest expense included a one-time $4.3 million ($0.11 per share, web of tax) of elevated compensation and advantages for all staff on account of a report yr of earnings in 2021 and worker efficiency by way of the pandemic
• Noninterest expense included $17 thousand pre-tax merger profit (<$0.01 per share, web of tax) in 4Q21 and $2.1 million of pre-tax merger costs ($0.05 per share, web of tax) in 3Q21
• Excluding the results of the merger and different immaterial changes, core working bills had been $35.5 million in 3Q22, up 4.1% YoY and 0.3% QoQ
• GAAP noninterest expense to common belongings was 1.69% in 3Q22, 1.73% in 2Q22, 1.93% in 1Q22, 1.92percentin 4Q21, and 1.80% in 3Q21

The provision for revenue taxes was $9.0 million in 3Q22 in comparison with $9.9 million in 2Q22, $6.4 million in 1Q22, $4.7 million in 4Q21, and $9.4 million in 3Q21.

• The efficient tax charge was 27.7% in 3Q22, 28.4% in 2Q22, 26.1% in 1Q22, 20.8% in 4Q21, and 27.0% in 3Q21
• The 2Q22 efficient tax charge features a loss of a sure state and metropolis tax deductions and a decision of sure examinations by taxing authorities
• The 4Q21 efficient tax charge declined on account of decrease ranges of taxable state revenue and better share of everlasting variations

Average loans had been $6.9 billion, a rise of 3.4% YoY and three.3% QoQ.

• Period finish web loans, excluding PPP loans, totaled $6.9 billion, up 6.8% YoY and three.1% QoQ
• Total mortgage closings had been $463.7 million in 3Q22, $503.8 million in 2Q22, $329.3 million in 1Q22, $362.7 million in 4Q21, and $243.9 million in 3Q21
• The mortgage pipeline was $309.1 million at September 30, 2022, down 41.8% YoY and 46.9% QoQ

Average Deposits totaled $6.3 billion, lowering 2.1% YoY and a couple of.6% QoQ.

• Average core deposits (non-CD deposits) had been 83.1% of complete common deposits (together with escrow deposits) in 3Q22, in comparison with 83.8% a yr in the past
• Average noninterest bearing deposits elevated 12.5% YoY and 0.5% QoQ and comprised 16.7% of complete common deposits (together with escrow deposits) in 3Q22 in comparison with 14.6% a yr in the past

Credit Quality: Nonperforming loans held on the finish of every quarter totaled $29.0 million at 3Q22, $27.9 million at 2Q22, $14.1 million at 1Q22, $14.9 million at 4Q21, and $20.2 million at 3Q21.

• Criticized and labeled had been 89 bps of loans at 3Q22 in comparison with 85 bps at 2Q22, 90 bps at 1Q22, 87 bps at 4Q21, and 104 bps at 3Q21
• Criticized and labeled belongings are composed of criticized and labeled loans, as detailed above, plus one criticized funding safety totaling $21.0 million in every quarter of 3Q22, 2Q22, 1Q22, 4Q21, and 3Q21
• Over 88% of gross loans are collateralized by actual property with a mean loan-to-value ratio of <37% as of September 30, 2022
• Allowance for credit score losses had been 142.3% of nonperforming loans at 3Q22 in comparison with 141.1% at 2Q22 and 179.9% a yr in the past

Capital: Book worth per widespread share was $22.47 at 3Q22, up 0.4% QoQ and three.2% YoY; tangible ebook worth per widespread share, a non-GAAP measure, was $21.81 at 3Q22, up 0.5% QoQ and three.2% YoY.

• The Company paid a dividend of $0.22 per share and repurchased 131,174 shares at a mean worth of $20.47 in 3Q22
• At the tip of 3Q22, 969,324 shares stay topic to repurchase beneath the approved inventory repurchase program, which has no expiration or most greenback restrict
• Tangible widespread fairness to tangible belongings was 7.62% at 3Q22 in comparison with 7.82% at 2Q22 and eight.04% at 3Q21
• The Company and the Bank stay nicely capitalized beneath all relevant regulatory necessities
• The leverage ratio was 8.74% at 3Q22 in comparison with 8.91% at 2Q22 and eight.83% at 3Q21

Conference Call Information:

• John R. Buran, President and Chief Executive Officer, and Susan Ok. Cullen, Senior Executive Vice President and Chief Financial Officer and Treasurer, will host a convention name on Wednesday, October 26, 2022, at 9:30 AM (ET) to debate the Company’s third quarter 2022 outcomes and technique.
• Dial-in for Live Call: 1-877-509-5836; Canada 855-669-9657
• Webcast: https://services.choruscall.com/mediaframe/webcast.html?webcastid=xiCFFixk
• Dial-in for Replay: 1-877-344-7529; Canada 855-669-9658
• Replay Access Code: 8005279
• The convention name can be concurrently webcast and archived

Fourth Quarter 2022 Earnings Release Date:

The Company plans to launch Fourth Quarter and full yr 2022 monetary outcomes after the market shut on January 24, 2023; adopted by a convention name at 9:30 AM (ET) on January 25, 2023.

An in depth announcement can be issued previous to the fourth quarter’s shut confirming the date and time of the earnings launch.

About Flushing Financial Corporation

Flushing Financial Corporation (Nasdaq: FFIC) is the holding firm for Flushing Bank®, an FDIC insured, New York State—chartered business financial institution that operates banking places of work in Queens, Brooklyn, Manhattan, and on Long Island. The Bank has been constructing relationships with households, business house owners, and communities since 1929. Today, it provides the merchandise, companies, and conveniences related to giant business banks, together with a full complement of deposit, mortgage, tools finance, and money administration companies. Rewarding prospects with personalised consideration and bankers that may talk within the languages prevalent inside these multicultural markets is what makes the Bank uniquely completely different. As an Equal Housing Lender and chief in actual property lending, the Bank’s skilled lending groups create mortgage options for actual property house owners and property managers each inside and out of doors the New York City metropolitan space. The Bank additionally fosters relationships with customers nationwide by way of its on-line banking division with the iGObanking® and BankPurely® manufacturers.

Additional data on Flushing Bank and Flushing Financial Corporation could also be obtained by visiting the Company’s web site at FlushingBank.com. Flushing Financial Corporation’s earnings launch and presentation slides can be out there previous to the convention name at www.FlushingBank.com beneath Investor Relations.

“Safe Harbor” Statement beneath the Private Securities Litigation Reform Act of 1995: Statements on this Press Release regarding plans, methods, financial efficiency and developments, projections of outcomes of particular actions or investments and different statements that aren’t descriptions of historic info could also be forward-looking statements throughout the that means of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking data is inherently topic to dangers and uncertainties, and precise outcomes may differ materially from these presently anticipated on account of a quantity of elements, which embody, however should not restricted to, threat elements mentioned within the Company’s Annual Report on Form 10-Ok for the fiscal yr ended December 31, 2021 and in different paperwork filed by the Company with the Securities and Exchange Commission infrequently. Forward-looking statements could also be recognized by phrases reminiscent of “may”, “will”, “should”, “could”, “expects”, “plans”, “intends”, “anticipates”, “believes”, “estimates”, “predicts”, “forecasts”, “goals”, “potential” or “continue” or related phrases or the damaging of these phrases. Although we imagine that the expectations mirrored within the forward-looking statements are cheap, we can not assure future outcomes, ranges of exercise, efficiency or achievements. The Company has no obligation to replace these forward-looking statements.

Investor Contact: Susan Ok. Cullen, SEVP, CFO and Treasurer, 718-961-5400

#FF

– Statistical Tables Follow –

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
FINANCIAL HIGHLIGHTS
(Unaudited)

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⁽¹⁾ Ratios are offered on an annualized foundation, the place acceptable.
⁽²⁾ Yields are calculated on the tax equal foundation utilizing the statutory federal revenue tax charge of 21% for the intervals offered.
⁽³⁾ Efficiency ratio, a non-GAAP measure, was calculated by dividing noninterest expense (excluding merger expense, OREO expense, prepayment penalty on borrowings, the web achieve/loss from the sale of OREO and web amortization of buy accounting changes) by the full of web curiosity revenue (excluding web beneficial properties and losses from truthful worth changes on qualifying hedges and web amortization of buy accounting changes) and noninterest revenue (excluding life insurance proceeds, web beneficial properties and losses from the sale or disposition of securities, belongings and truthful worth changes).
⁽⁴⁾ Calculated by dividing stockholders’ fairness by shares excellent.
⁽⁵⁾ Calculated by dividing tangible stockholders’ widespread fairness, a non-GAAP measure, by shares excellent. Tangible stockholders’ widespread fairness is stockholders’ fairness much less intangible belongings (goodwill, web of deferred taxes). See “Calculation of Tangible Stockholders’ Common Equity to Tangible Assets”.
⁽⁶⁾ See “Calculation of Tangible Stockholders’ Common Equity to Tangible Assets”.
⁽⁷⁾ Excludes performing nonaccrual TDR loans.

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
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FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
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FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
AVERAGE BALANCE SHEETS
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FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
NET INTEREST INCOME AND NET INTEREST MARGIN
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