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Section 1: 8-K (8-K)


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549


 
FORM 8-K
 


CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported):  April 26, 2018
 

 
DIME COMMUNITY BANCSHARES, INC.
(Exact name of the registrant as specified in its charter)
 

 
Delaware
000-27782
11-3297463
(State or other jurisdiction of
incorporation or organization)
(Commission File Number)
(IRS Employer
Identification No.)

300 Cadman Plaza West, 8th Floor
Brooklyn, New York
 
11201
(Address of principal executive offices)
 
(Zip Code)
 
(718) 782-6200
(Registrant’s telephone number)

N/A
(Former name or former address, if changed since last report)
 


Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4c)

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
 


Item 2.02
Results of Operations and Financial Condition

On April 26, 2018, Dime Community Bancshares, Inc. (the “Registrant”) issued a press release containing a discussion of its results of operations and financial condition for the quarter ended March 31, 2018. The text of the press release is included as Exhibit 99.1 to this report and is incorporated herein by reference. Exhibit 99.1 to this report is being “furnished” to the SEC and shall not be deemed “filed” for any purposes.

Item 7.01
Regulation FD Disclosure

On April 26, 2018, the Registrant announced that its Board of Directors declared a quarterly cash dividend of $0.14 per common share, payable on May 15, 2018 to stockholders of record on May 8, 2018. The text of the press release is attached as Exhibit 99.2 and is incorporated herein by reference. Exhibit 99.2 to this report is being “furnished” to the SEC and shall not be deemed “filed” for any purpose.

Item 9.01
Financial Statements and Exhibits
 
 
(d)
Exhibits.

 
Press release of the Registrant, dated April 26, 2018, containing a discussion of the Registrant’s results of operations and financial condition for the quarter ended March 31, 2018

Press release of the Registrant, dated April 26, 2018, containing a discussion of the Registrant’s declaration of a cash dividend
 

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 
Dime Community Bancshares, Inc.
 
(Registrant)
   
 
/s/ JAMES L. RIZZO
 
 
James L. Rizzo
 
Senior Vice President  & Comptroller
 
(Principal Financial Officer)
   
Dated:  April 27, 2018
 
 
 

(Back To Top)

Section 2: EX-99.1 (EXHIBIT 99.1)


Exhibit 99.1
 
 
DIME COMMUNITY BANCSHARES, INC. INCREASES QUARTERLY EARNINGS PER SHARE BY 30% ON A YEAR-OVER-YEAR BASIS

Brooklyn, NY – April 26, 2018 - Dime Community Bancshares, Inc. (NASDAQ: DCOM) (the “Company” or “Dime”), the parent company of Dime Community Bank (the “bank”), today reported net income of $14.7 million for the quarter ended March 31, 2018, or $0.39 per diluted common share, compared with net income of $15.4 million for the quarter ended December 31, 2017, or $0.41 per diluted common share, and net income of $11.2 million for the quarter ended March 31, 2017, or $0.30 per diluted common share.

Highlights for the first quarter of 2018 included:
 
§
New loan originations for the first quarter were at generally higher rates than the overall loan portfolio; the weighted average rate (“WAR”) on new real estate originations was 4.17% and the WAR on new C&I originations was 4.81%, compared to the total loan portfolio WAR of 3.61% for the three months ended March 31, 2018;
§
Continued the build out of the Business Banking division via the hire of a new team that will operate from the Company’s Borough Park branch location and the creation of an additional team from existing personnel. Pro forma for these two new teams, the Company’s Business Banking division has six teams in total;
§
Consolidated  Company CRE concentration ratio declined to 748.6% at March 31, 2018, versus 906.5% at March 31, 2017;
§
Total non-interest income was $3.2 million for the first quarter of 2018, driven by a $1.4 million gain from the sale of a portion of the securities the Company had previously retained from its Freddie Mac sponsored “Q-deal” securitization;
§
Increase in the Company’s on-balance sheet liquidity levels, as average mortgage-backed securities and other short-term investments, as a percentage of average interest-earning assets increased to 9.1% for the quarter versus 4.0% for the prior quarter;
§
Loan-to-deposit ratio declined to 124% at March 31, 2018, versus 128% at March 31, 2017; and
§
Reported book value per share and tangible book value (common equity less goodwill, divided by number of shares outstanding) per share grew to $16.22 and $14.73, respectively, at March 31, 2018.
 
Kenneth J. Mahon, President and Chief Executive Officer of the Company, stated “We are on track to achieve our full year 2018 portfolio growth targets for the Business Banking division, as we have a strong pipeline in place. The Business Banking division ended the first quarter with approximately $61 million of low-cost relationship-based deposits at an average cost of 16 basis points. Across the organization, we are highly focused on improving the composition of our deposit base.”
 

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Mr. Mahon concluded, “Our  employees are hard at work, ensuring our core systems conversion, which is scheduled to be completed in June, proceeds smoothly. The move to a new core platform will enable us to more effectively service our customers and is consistent with our stated goal of transitioning into a successful community commercial bank.”

Management’s Discussion of Quarterly Operating Results

Net Interest Income

Net interest income in the first quarter of 2018 was $38.0 million, a decrease of $0.7 million (-1.9%) from the fourth quarter of 2017 and an increase of $0.5 million (+1.4%) over the first quarter of 2017. Net interest margin (“NIM”) was 2.47% during the first quarter of 2018, compared to 2.50% in the fourth quarter of 2017, and 2.57% during the first quarter of 2017.  The linked quarter decrease in NIM was due to an increase in the level of on balance sheet liquidity levels and a 11 basis point increase in the average cost of funds, partially offset by a 13 basis point increase in the average yield on total real estate loans.

Average interest-earning assets were $6.15 billion for the first quarter of 2018, a 3.8% (annualized) decrease from $6.20 billion for the fourth quarter of 2017, and a 5.5% increase from $5.82 billion for the first quarter of 2017. The linked quarter decline in average interest-earnings assets was primarily driven by a decline in real estate loans, as the volume of loan payoffs exceeded new originations.

Average mortgage backed-securities and other short-term investments were $561.2 million for the first quarter of 2018, a 508.6% (annualized) increase from $247.1 million for the fourth quarter of 2017, and a 382.3% increase from $116.4 million for the first quarter of 2017. “In keeping with our strategic asset diversification objectives, and after reviewing the results of our numerous liquidity stress testing scenarios, we have significantly increased our on-balance sheet liquidity levels over the past few quarters,” stated Mr. Mahon.

For the first quarter of 2018, the average yield on interest-earning assets was 3.58%, an increase of 6 basis points compared with the fourth quarter of 2017, and an increase of 5 basis points compared to the first quarter of 2017.  The average cost of funds (which includes Federal Home Loan Bank advances) was 1.30% for the first quarter of 2018, an increase of 11 basis points versus the fourth quarter of 2017, and an increase of 17 basis points versus the first quarter of 2017.

Loans

The real estate loan portfolio declined by $103.5 million (7.6% annualized) during the first quarter of 2018 due primarily to an increase in the level of loan payoffs versus the fourth quarter of 2017. Real estate loan originations were $75.0 million during the first quarter of 2018, at a weighted average interest rate of 4.17%, compared to $70.6 million of originations for the prior quarter, at a weighted average interest rate of 4.36%. Real estate loan amortization and satisfactions totaled $183.1 million, or 13.6% (annualized) of the portfolio balance, at an average rate of 3.65%. The annualized loan payoff rate of 13.6% for the first quarter of 2018 was higher than both the fourth quarter of 2017 (10.2%) and the first quarter of 2017 (10.8%). Average real estate loans were $5.44 billion in the first quarter of 2018, a decrease of $388.4 million (26.7% annualized) from the fourth quarter of 2017, and a decrease of $252.2 million (4.4%) from the first quarter of 2017.
 

Page 3
Included in total real estate loan originations during the first quarter of 2018 were $21.2 million of originations from the Business Banking division at a weighted average rate of 4.21%, compared to $24.1 million of originations at a weighted average rate of 4.78% during the fourth quarter of 2017.

Commercial and industrial (“C&I”) loan originations were $25.3 million during the first quarter of 2018, at a weighted average rate of 4.81%, compared to $27.5 million at a weighted average rate of 4.94% during the fourth quarter of 2017. Total C&I loan balances were $145.8 million at the end of the first quarter of 2018, compared to $136.7 million at the end of the fourth quarter of 2017.

Deposits and Borrowed Funds

The Company continues to focus on growing relationship-based deposits sourced from its retail branches and Business Banking division. On a year-over-year basis, the sum of average non-interest- bearing checking account balances and average interest-bearing checking account balances increased by 8.2% to $435.1 million for the first quarter of 2018.

The average cost of total deposits increased 9 basis points on a linked quarter basis to 1.00% as the bank increased rates on selective money market and certificates of deposit products in light of increased competition. Overall, total deposits increased by $27.0 million during the first quarter of 2018 from the linked quarter. Mr. Mahon commented, “We grew deposits in the first quarter despite approximately $83.0 million of net outflows from our DimeDirect internet channel, where our posted rate continues to lag our online competitors. Our funding focus remains on generating core business deposits, and as such we have maintained a less aggressive online deposit pricing posture. We intend to manage the balance sheet and the loan-to-deposit ratio with the goal of keeping deposit betas as low as possible.”

The loan-to-deposit ratio was 124.3% at March 31, 2018, compared to 127.2% at December 31, 2017 and 127.6% at March 31, 2017.

Reflecting deposit inflows and lower total assets, total borrowings were decreased by $159.6 million during the first quarter of 2018 as compared to the fourth quarter of 2017.  To better position the Company for rising interest rates, the Company reduced its level of short-term borrowings in the first quarter of 2018 and entered into $170.0 million of long-term borrowings (with terms of 2 years and more), at an average rate of 2.57%. This compares to $110.0 million of long-term borrowings at an average rate of 2.22% for the fourth quarter of 2017.

Non-Interest Income

Non-interest income was $3.2 million during the first quarter of 2018, which was $10.5 million lower compared to the fourth quarter of 2017, and an increase of $1.5 million compared to the first quarter of 2017.  The linked quarter decrease in non-interest income was primarily the result of gains of $10.4 million from the sale of real estate property and $1.5 million from the sale of loans in the fourth quarter of 2017, offset by $1.4 million of gains during the first quarter of 2018 from the sale of securities that the bank had retained from its Freddie Mac sponsored Q-deal securitization.
 

Page 4
Non-Interest Expense

Total non-interest expense was $21.7 million during the first quarter of 2018, $22.6 million during the fourth quarter of 2017, and $20.8 million during the first quarter of 2017. The year-over-year increase in non-interest expense was primarily the result of a $1.3 million increase in salaries and employee benefits.

The ratio of non-interest expense to average assets was 1.36% during the first quarter of 2018, lower than both 1.41% during the fourth quarter of 2017, and 1.38% during the first quarter of 2017.

The efficiency ratio was 54.6% during the first quarter of 2018, lower than the 55.63% during the fourth quarter of 2017, and higher than the 53.0% during the first quarter of 2017.

Income Tax Expense

The reported effective tax rate for the first quarter of 2018 declined to 23.7%. The lower tax rate was the result of recently enacted corporate tax reform.

Credit Quality

Non-performing loans were $1.7 million, or 0.03% of total loans, at March 31, 2018, an increase from $0.5 million, or 0.01% of total loans, at December 31, 2017.  The allowance for loan losses was 0.39% of total loans at March 31, 2018, versus 0.38% at December 31, 2017. At March 31, 2018, non-performing assets represented 2.5% of the sum of the bank’s tangible common equity plus the allowance for loan losses and reserve for contingent liabilities (this non-Generally Accepted Accounting Principle (“GAAP”) statistic is otherwise known as the “Texas Ratio”) (see “Problem Assets as a Percentage of Tangible Capital and Reserves” table and “Non-GAAP Reconciliation” table at the end of this news release), which is lower than the ratio of 3.4% at December 31, 2017.  A loan loss provision of $0.2 million was recorded during the first quarter of 2018, compared to a credit for loan losses of $1.0 million during the fourth quarter of 2017, and a provision for loan losses of $0.5 million during the first quarter of 2017.

Capital Management

The Company’s consolidated Tier 1 capital to average assets (“leverage ratio”), which was 8.79% at March 31, 2018, was in excess of all applicable regulatory requirements.

The bank’s regulatory capital ratios continued to be in excess of all applicable regulatory requirements inclusive of conservation buffer amounts.  At March 31, 2018, the bank’s leverage ratio was 9.59%, while Tier 1 capital to risk-weighted assets and Total capital to risk-weighted assets ratios were 12.97% and 13.43%, respectively.

Diluted earnings per common share of $0.39 exceeded the quarterly $0.14 cash dividend per share by 179% during the first quarter of 2018, equating to a 35.9% dividend payout ratio.

Book value per share was $16.22 and tangible book value (common equity less goodwill divided by number of shares outstanding) per share was $14.73 at March 31, 2018.
 

Page 5
Earnings Call Information

The Company will conduct a conference call at 5:30 p.m. (ET) on Thursday, April 26, 2018, during which President and Chief Executive Officer, Kenneth J. Mahon, will discuss the Company’s first quarter financial performance.  There will be a question and answer period after the CEO remarks. Dial-in information for the live call is 1-888-317-6016. Upon dialing in, request to be joined into Dime Community Bancshares, Inc. call with the conference operator.

The conference call will be simultaneously webcast (listen only), and archived for a period of one year, at https://services.choruscall.com/links/dcom180426.html. Dial-in information for the replay is 1-877-344-7529 using access code #10119608. Replay will be available April 26, 2018 (7:30 p.m.) through May 3, 2018 (11:59 p.m.)

ABOUT DIME COMMUNITY BANCSHARES, INC.
The Company had $6.33 billion in consolidated assets as of March 31, 2018. The bank was founded in 1864, is headquartered in Brooklyn, New York, and currently has twenty-nine branches located throughout Brooklyn, Queens, the Bronx, Nassau County and Suffolk County, New York. More information on the Company and the bank can be found on Dime’s website at www.dime.com.

This news release contains a number of forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These statements may be identified by use of words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “likely,” “may,” “outlook,” “plan,” “potential,” “predict,” “project,” “should,” “will,” “would” and similar terms and phrases, including references to assumptions.

Forward-looking statements are based upon various assumptions and analyses made by the Company in light of management’s experience and its perception of historical trends, current conditions and expected future developments, as well as other factors it believes are appropriate under the circumstances. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors (many of which are beyond the Company’s control) that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Accordingly, you should not place undue reliance on such statements. Factors that could affect our results include, without limitation, the following: the timing and occurrence or non-occurrence of events may be subject to circumstances beyond the Company’s control; there may be increases in competitive pressure among financial institutions or from non-financial institutions; changes in the interest rate environment may reduce interest margins; changes in deposit flows, loan demand or real estate values may adversely affect the business of the Company and/or the Bank; unanticipated or significant increases in loan losses; changes in accounting principles, policies or guidelines may cause the Company’s financial condition to be perceived differently; changes in corporate and/or individual income tax laws may adversely affect the Company’s financial condition or results of operations; general economic conditions, either nationally or locally in some or all areas in which the Company conducts business, or conditions in the securities markets or the banking industry may be less favorable than the Company currently anticipates; legislation or regulatory changes may adversely affect the Company’s business; technological changes may be more difficult or expensive than the Company anticipates; there may be failures or breaches of information technology security systems; success or consummation of new business initiatives may be more difficult or expensive than the Company anticipates; or litigation or other matters before regulatory agencies, whether currently existing or commencing in the future, may delay the occurrence or non-occurrence of events longer than the Company anticipates.

Contact: Avinash Reddy
Senior Vice President – Corporate Development and Treasurer
718-782-6200 extension 5909
 

Page 6
DIME COMMUNITY BANCSHARES,  INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollars in thousands except share amounts)

   
March 31,
2018
   
December 31,
2017
 
ASSETS:
           
Cash and due from banks
 
$
188,826
   
$
169,455
 
Mortgage-backed securities available for sale
   
354,410
     
351,384
 
Marketable equity securities, at fair value
   
6,433
     
-
 
Investment securities available for sale
   
-
     
4,006
 
Trading securities
   
-
     
2,715
 
Real Estate Loans:
               
One-to-four family and cooperative/condominium apartment
   
62,596
     
63,095
 
Multifamily residential and residential mixed use (1)(2)
   
4,280,951
     
4,381,180
 
Commercial real estate
   
1,007,595
     
1,010,603
 
Acquisition, development, and construction (“ADC”)
   
9,413
     
9,189
 
Total real estate loans
   
5,360,555
     
5,464,067
 
Commercial and industrial (“C&I”)
   
145,818
     
136,671
 
Other loans
   
1,053
     
1,379
 
Allowance for loan losses
   
(21,204
)
   
(21,033
)
Total loans, net
   
5,486,222
     
5,581,084
 
Premises and fixed assets, net
   
25,276
     
24,326
 
Federal Home Loan Bank of New York capital stock
   
52,514
     
59,696
 
Bank Owned Life Insurance (“BOLI”)
   
109,257
     
108,545
 
Goodwill
   
55,638
     
55,638
 
Other assets
   
47,341
     
46,611
 
TOTAL ASSETS
 
$
6,325,917
   
$
6,403,460
 
LIABILITIES AND STOCKHOLDERS’ EQUITY:
               
Deposits:
               
Non-interest bearing checking
 
$
325,071
   
$
307,746
 
Interest-bearing checking
   
124,527
     
124,283
 
Savings
   
357,152
     
362,092
 
Money Market
   
2,399,200
     
2,517,439
 
Sub-total
   
3,205,950
     
3,311,560
 
Certificates of deposit
   
1,224,491
     
1,091,887
 
Total Due to Depositors
   
4,430,441
     
4,403,447
 
Escrow and other deposits
   
131,953
     
82,168
 
Federal Home Loan Bank of New York advances
   
1,010,400
     
1,170,000
 
Subordinated Notes Payable, net
   
113,649
     
113,612
 
Other liabilities
   
31,517
     
35,666
 
TOTAL LIABILITIES
   
5,717,960
     
5,804,893
 
STOCKHOLDERS’ EQUITY:
               
Common stock ($0.01 par, 125,000,000 shares authorized, 53,653,224 shares and 53,624,453 shares issued at March 31, 2018 and December 31, 2017, respectively, and 37,484,270 shares and 37,419,070 shares outstanding at March 31, 2018 and December 31, 2017, respectively)
   
537
     
536
 
Additional paid-in capital
   
277,070
     
276,730
 
Retained earnings
   
544,762
     
535,130
 
Accumulated other comprehensive loss, net of deferred taxes
   
(4,037
)
   
(3,641
)
Unearned Restricted Stock Award common stock
   
(3,855
)
   
(2,894
)
Common stock held by the Benefit Maintenance Plan
   
(2,196
)
   
(2,736
)
Treasury stock (16,168,954 shares and 16,205,383 shares at March 31, 2018 December 31, 2017, respectively)
   
(204,324
)
   
(204,558
)
TOTAL STOCKHOLDERS’ EQUITY
   
607,957
     
598,567
 
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
 
$
6,325,917
   
$
6,403,460
 
                 

(1)
Includes loans underlying cooperatives.
(2)
While the loans within this category are often considered “commercial real estate” in nature, multifamily and loans underlying cooperatives are here reported separately from commercial real estate loans in order to emphasize the residential nature of the collateral underlying this significant  component of the total loan portfolio.
 

Page 7
DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands except share and per share amounts)

   
For the Three Months Ended
 
   
March 31,
2018
   
December 31,
2017
   
March 31,
2017
 
Interest income:
                 
Loans secured by real estate
 
$
49,575
   
$
51,254
   
$
50,475
 
Commercial and industrial (“C&I”)
   
1,656
     
1,514
     
41
 
Other loans
   
19
     
20
     
18
 
Mortgage-backed securities
   
2,257
     
487
     
14
 
Investment securities
   
15
     
115
     
190
 
Other short-term investments
   
1,511
     
1,204
     
717
 
Total interest  income
   
55,033
     
54,594
     
51,455
 
Interest expense:
                       
Deposits and escrow
   
10,751
     
9,967
     
9,507
 
Borrowed funds
   
6,267
     
5,895
     
4,461
 
Total interest expense
   
17,018
     
15,862
     
13,968
 
Net interest income
   
38,015
     
38,732
     
37,487
 
Provision (Credit) for loan losses
   
193
     
(1,000
)
   
450
 
Net interest income after  provision (credit) for loan losses
   
37,822
     
39,732
     
37,037
 
                         
Non-interest income:
                       
Service charges and other fees
   
911
     
1,167
     
794
 
Mortgage banking income, net
   
111
     
51
     
16
 
Gain (loss) on equity and trading securities
   
(4
)
   
(29
)
   
75
 
Gain on sale of securities and other assets
   
1,370
     
-
     
-
 
Gain on sale of loans
   
90
     
1,475
     
-
 
Gain on the sale of premises held for sale
   
-
     
10,412
     
-
 
Income from BOLI
   
712
     
563
     
545
 
Other
   
54
     
67
     
348
 
Total non-interest income
   
3,244
     
13,706
     
1,778
 
Non-interest expense:
                       
Salaries and employee benefits
   
11,177
     
9,699
     
9,926
 
Stock benefit plan compensation expense
   
388
     
417
     
394
 
Occupancy and equipment
   
3,872
     
3,581
     
3,628
 
Data processing costs
   
1,754
     
1,778
     
1,607
 
Marketing
   
1,047
     
1,375
     
1,466
 
Federal deposit insurance premiums
   
665
     
724
     
655
 
Other
   
2,831
     
4,999
     
3,093
 
Total non-interest expense
   
21,734
     
22,573
     
20,769
 
                         
Income before taxes
   
19,332
     
30,865
     
18,046
 
Income tax expense
   
4,587
     
15,442
     
6,889
 
                         
Net Income
 
$
14,745
   
$
15,423
   
$
11,157
 
                         
Earnings per Share (“EPS”):
                       
Basic
 
$
0.39
   
$
0.41
   
$
0.30
 
Diluted
 
$
0.39
   
$
0.41
   
$
0.30
 
                         
Average common shares outstanding for Diluted EPS
   
37,464,725
     
37,432,283
     
37,549,576
 
 

Page 8
DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED SELECTED FINANCIAL HIGHLIGHTS
(Dollars in thousands except per share amounts)

   
At or For the Three Months Ended
 
   
March 31,
2018
   
December 31,
2017
   
March 31,
2017
 
Per Share Data:
                 
Reported EPS (Diluted)
 
$
0.39
   
$
0.41
   
$
0.30
 
Cash dividends paid per share
   
0.14
     
0.14
     
0.14
 
Book value per share
   
16.22
     
16.00
     
15.26
 
Tangible book value per share (1)
   
14.73
     
14.51
     
13.78
 
Dividend payout ratio
   
35.90
%
   
34.15
%
   
46.67
%
                         
Performance Ratios (Based upon Reported Net Income):
                       
Return on average assets
   
0.93
%
   
0.96
%
   
0.74
%
Return on average common equity
   
9.77
%
   
10.41
%
   
7.83
%
Return on average tangible common equity (1)
   
10.76
%
   
11.49
%
   
8.68
%
Net interest spread
   
2.28
%
   
2.33
%
   
2.40
%
Net interest margin
   
2.47
%
   
2.50
%
   
2.57
%
Average interest-earning assets to average interest-bearing liabilities
   
115.84
%
   
117.07
%
   
116.36
%
Non-interest expense to average assets
   
1.36
%
   
1.41
%
   
1.38
%
Efficiency ratio
   
54.60
%
   
55.63
%
   
53.00
%
Loan-to-deposit ratio at end of period
   
124.31
%
   
127.22
%
   
127.59
%
Effective tax rate
   
23.73
%
   
50.03
%
   
38.17
%
                         
Average Balance Data:
                       
Average assets
 
$
6,369,310
   
$
6,400,719
   
$
6,026,914
 
Average interest-earning assets
   
6,145,013
     
6,203,511
     
5,824,309
 
Average loans
   
5,577,309
     
5,949,955
     
5,691,098
 
Average deposits
   
4,378,117
     
4,351,863
     
4,485,510
 
Average common equity
   
603,555
     
592,762
     
569,723
 
Average tangible common equity (1)
   
547,917
     
537,124
     
514,085
 
                         
Asset Quality Summary:
                       
Non-performing loans (excluding loans held for sale)
 
$
1,719
   
$
533
   
$
3,801
 
Non-performing assets (2)
   
1,719
     
533
     
5,080
 
Net charge-offs (recoveries)
   
23
     
(26
)
   
32
 
Non-performing loans/ Total loans
   
0.03
%
   
0.01
%
   
0.07
%
Non-performing assets/ Total assets
   
0.03
%
   
0.01
%
   
0.08
%
Allowance for loan loss/ Total loans
   
0.39
%
   
0.38
%
   
0.36
%
Allowance for loan loss/ Non-performing loans
   
1233.51
%
   
3946.15
%
   
551.28
%
Loans delinquent 30 to 89 days at period end
 
$
2,947
   
$
37
   
$
173
 
                         
Capital Ratios - Consolidated:
                       
Tangible common equity to tangible assets (1)
   
8.81
%
   
8.55
%
   
8.57
%
Tier 1 common equity ratio
   
11.87
     
11.42
     
11.08
 
Tier 1 risk-based capital ratio
   
11.87
     
11.42
     
12.53
 
Total risk-based capital ratio
   
14.79
     
14.27
     
12.98
 
Tier 1 leverage ratio
   
8.79
     
8.61
     
9.91
 
                         
Capital Ratios - Bank Only:
                       
Tier 1 common equity ratio
   
12.97
%
   
12.38
%
   
11.25
%
Tier 1 risk-based capital ratio
   
12.97
     
12.38
     
11.25
 
Total risk-based capital ratio
   
13.43
     
12.83
     
11.70
 
Tier 1 leverage ratio
   
9.59
     
9.32
     
8.88
 

(1)
See “Non-GAAP Reconciliation” table for reconciliation of tangible common equity and tangible assets.
(2)
Amount comprised of total non-accrual loans and the recorded balance of pooled bank trust preferred security investments that were deemed to meet the criteria of a non-performing asset, if applicable.
 

Page 9
DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED AVERAGE BALANCES AND NET INTEREST INCOME
(Dollars in thousands)

   
For the Three Months Ended
 
         
March 31, 2018
               
December 31, 2017
               
March 31, 2017
       
   
Average
Balance
   
Interest
   
Average
Yield/
Cost
   
Average
Balance
   
Interest
   
Average
Yield/
Cost
   
Average
Balance
   
Interest
   
Average
Yield/
Cost
 
Assets:
                                                     
Interest-earning assets:
                                                     
Real estate loans
 
$
5,435,400
   
$
49,575
     
3.65
%
 
$
5,823,794
   
$
51,254
     
3.52
%
 
$
5,687,557
   
$
50,475
     
3.55
%
Commercial and industrial loans
   
140,720
     
1,656
     
4.71
     
125,095
     
1,514
     
4.84
     
2,474
     
41
     
6.63
 
Other loans
   
1,189
     
19
     
6.39
     
1,066
     
20
     
7.50
     
1,067
     
18
     
6.75
 
Mortgage-backed securities
   
351,196
     
2,257
     
2.57
     
84,942
     
487
     
2.29
     
3,489
     
14
     
1.61
 
Investment securities
   
6,492
     
15
     
0.92
     
6,500
     
115
     
7.08
     
16,841
     
190
     
4.51
 
Other short-term investments
   
210,016
     
1,511
     
2.88
     
162,114
     
1,204
     
2.97
     
112,881
     
717
     
2.54
 
Total interest-earning assets
   
6,145,013
     
55,033
     
3.58
%
   
6,203,511
     
54,594
     
3.52
%
   
5,824,309
     
51,455
     
3.53
%
Non-interest-earning assets
   
224,297
                     
197,208
                     
202,605
                 
Total assets
 
$
6,369,310
                   
$
6,400,719
                   
$
6,026,914
                 
                                                                         
Liabilities and Stockholders’ Equity:
                                                                       
Interest-bearing liabilities:
                                                                       
Interest-bearing checking accounts
 
$
124,440
   
$
54
     
0.18
%
 
$
117,468
   
$
56
     
0.19
%
 
$
110,797
   
$
58
     
0.21
%
Money market accounts
   
2,432,242
     
6,318
     
1.05
     
2,491,423
     
5,986
     
0.95
     
2,693,219
     
5,780
     
0.87
 
Savings accounts
   
359,638
     
59
     
0.07
     
358,859
     
51
     
0.06
     
368,087
     
45
     
0.05
 
Certificates of deposit
   
1,151,146
     
4,320
     
1.52
     
1,077,376
     
3,874
     
1.43
     
1,022,155
     
3,624
     
1.44
 
Total interest-bearing deposits
   
4,067,466
     
10,751
     
1.07
     
4,045,126
     
9,967
     
0.98
     
4,194,258
     
9,507
     
0.92
 
Borrowed Funds
   
1,237,094
     
6,267
     
2.05
     
1,253,860
     
5,895
     
1.87
     
811,288
     
4,461
     
2.23
 
Total interest-bearing liabilities
   
5,304,560
     
17,018
     
1.30
%
   
5,298,986
     
15,862
     
1.19
%
   
5,005,546
     
13,968
     
1.13
%
Non-interest-bearing checking accounts
   
310,651
                     
306,737
                     
291,252
                 
Other non-interest-bearing liabilities
   
150,544
                     
202,234
                     
160,393
                 
Total liabilities
   
5,765,755
                     
5,807,957
                     
5,457,191
                 
Stockholders’ equity
   
603,555
                     
592,762
                     
569,723
                 
Total liabilities and stockholders’ equity
 
$
6,369,310
                   
$
6,400,719
                   
$
6,026,914
                 
Net interest income
         
$
38,015
                   
$
38,732
                   
$
37,487
         
Net interest spread
                   
2.28
%
                   
2.33
%
                   
2.40
%
Net interest-earning assets
 
$
840,453
                   
$
904,525
                   
$
818,763
                 
Net interest margin
                   
2.47
%
                   
2.50
%
                   
2.57
%
Ratio of interest-earning assets to interest-bearing liabilities
           
115.84
%
                   
117.07
%
                   
116.36
%
       
                                                                         
Deposits (including non-interest bearing checking accounts)
 
$
4,378,117
   
$
10,751
     
1.00
%
 
$
4,351,863
   
$
9,967
     
0.91
%
 
$
4,485,510
   
$
9,507
     
0.86
%
 

Page 10
DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED SCHEDULE OF LOAN COMPOSITION AND WEIGHTED AVERAGE RATES (“WAR”) (1)
(Dollars in thousands)

   
At March 31, 2018
   
At December 31, 2017
   
At March 31, 2017
 
   
Balance
   
WAR
   
Balance
   
WAR
   
Balance
   
WAR
 
Loan balances at period end:
                                   
One-to-four family residential, including condominium and cooperative apartment
 
$
62,596
     
4.36
%
 
$
63,095
     
4.33
%
 
$
75,131
     
4.30
%
Multifamily residential and residential mixed use (2)(3)
   
4,280,951
     
3.42
     
4,381,180
     
3.40
     
4,696,198
     
3.37
 
Commercial and commercial mixed use real estate
   
1,007,595
     
3.95
     
1,010,603
     
3.95
     
949,658
     
3.93
 
Acquisition, development, and construction (“ADC”)
   
9,413
     
5.84
     
9,189
     
5.59
     
-
     
-
 
Total real estate loans
   
5,360,555
     
3.53
     
5,464,067
     
3.51
     
5,720,987
     
3.47
 
                                                 
Commercial and industrial (“C&I”)
   
145,818
     
4.99
%
 
$
136,671
     
4.82
%
 
$
30,189
     
4.21
%

(1)
Weighted average rate is calculated by aggregating interest based on the current loan rate from each loan in the category, divided by the total amount of loans in the category.
(2)
Includes loans underlying cooperatives.
(3)
While the loans within this category are often considered “commercial real estate” in nature, multifamily and loans underlying cooperatives are here reported separately from commercial real estate loans in order to emphasize the residential nature of the collateral underlying this significant  component of the total loan portfolio.
 

Page 11
DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED SCHEDULE OF NON-PERFORMING ASSETS AND TROUBLED DEBT RESTRUCTURINGS (“TDRs”)
(Dollars in thousands)
 
Non-Performing Loans
 
At March 31,
2018
   
At December 31,
2017
   
At March 31,
2017
 
One-to-four family residential, including condominium and cooperative apartment
 
$
449
   
$
436
   
$
678
 
Multifamily residential and residential mixed use (1)(2)
   
-
     
-
     
2,623
 
Commercial mixed use real estate (2)
   
90
     
93
     
495
 
C&I
   
1,179
     
-
     
-
 
Other
   
1
     
4
     
5
 
Total Non-Performing Loans (3)
 
$
1,719
   
$
533
   
$
3,801
 
Other Non-Performing Assets
                       
Pooled bank trust preferred securities (4)
   
-
     
-
     
1,279
 
Total Non-Performing Assets
 
$
1,719
   
$
533
   
$
5,080
 
                          
Performing Loans
                       
One- to four-family and cooperative/condominium apartment
   
20
     
22
     
402
 
Multifamily residential and mixed use residential real estate (1)(2)
   
604
     
619
     
649
 
Mixed use commercial real estate (2)
   
4,152
     
4,174
     
4,240
 
Commercial real estate
   
3,279
     
3,296
     
3,347
 
Total Performing TDRs
 
$
8,055
   
$
8,111
   
$
8,638
 
 
(1)
Includes loans underlying cooperatives.
(2)
While the loans within this category are often considered “commercial real estate” in nature, multifamily and loans underlying cooperatives are here reported separately from commercial real estate loans in order to emphasize the residential nature of the collateral underlying this significant  component of the total loan portfolio.
(3)
There were no non-accruing TDRs for the periods indicated.
(4)
As of the date presented, certain pooled bank trust preferred securities were deemed to meet the criteria of a non-performing asset.
 
PROBLEM ASSETS AS A PERCENTAGE OF TANGIBLE CAPITAL AND RESERVES (TEXAS RATIO)
(Dollars in thousands)

   
At March 31,
2018
   
At December 31,
2017
   
At March 31,
2017
 
Total Non-Performing Assets
 
$
1,719
   
$
533
   
$
5,080
 
Loans 90 days or more past due on accrual status (5)
   
13,816
     
19,935
     
719
 
TOTAL PROBLEM ASSETS
 
$
15,535
   
$
20,468
   
$
5,799
 
                         
Tangible common equity - Bank only (6)
 
$
601,492
   
$
587,622
   
$
529,532
 
Allowance for loan losses and reserves for contingent liabilities
   
21,229
     
21,058
     
20,979
 
TANGIBLE COMMON EQUITY PLUS RESERVES
 
$
622,721
   
$
608,680
   
$
550,511
 
                         
TEXAS RATIO (PROBLEM ASSETS AS A PERCENTAGE OF
                       
TANGIBLE COMMON EQUITY AND RESERVES)
   
2.5
%
   
3.4
%
   
1.1
%

(5)
These loans were, as of the respective dates indicated, expected to be either satisfied, made current or re-financed within the following twelve months, and were not expected to result in any loss of contractual principal or interest.  These loans are not included in non-performing loans.
(6)
See “Non-GAAP Reconciliation” table for reconciliation of tangible common equity and tangible assets.
 

Page 12
DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
NON-GAAP RECONCILIATION
(Dollars in thousands except per share amounts)

   
At or For the Three Months Ended
 
   
March 31,
2018
   
December 31,
2017
   
March 31,
2017
 
Reconciliation of Reported and Adjusted (“non-GAAP”) Net Income:
                 
Reported net income
 
$
14,745
   
$
15,423
   
$
11,157
 
Adjustments to Net Income (1):
                       
Less: Gain on sale of securities
   
(930
)
   
-
     
-
 
Less: After tax gain on the sale of real estate
   
-
     
(5,724
)
   
-
 
Tax adjustment
   
(92
)
   
3,135
     
-
 
Adjusted (“non-GAAP”) net income
 
$
13,723
   
$
12,834
   
$
11,157
 
                         
Adjusted Ratios (Based upon “non-GAAP Net Income” as calculated above):
                       
Adjusted EPS (Diluted)
 
$
0.36
   
$
0.34
   
$
0.30
 
Adjusted return on average assets
   
0.86
%
   
0.80
%
   
0.74
%
Adjusted return on average common equity
   
9.09
%
   
8.66
%
   
7.83
%
Adjusted return on average tangible common equity
   
10.02
%
   
9.56
%
   
8.68
%
                         
Reconciliation of Tangible Assets:
                       
Total assets
 
$
6,325,917
   
$
6,403,460
   
$
6,095,370
 
Less:
                       
Goodwill
   
55,638
     
55,638
     
55,638
 
Tangible assets
   
6,270,279
     
6,347,822
     
6,039,732
 
                         
Reconciliation of Tangible Common Equity - Consolidated:
                       
Total common equity
 
$
607,957
   
$
598,567
   
$
573,225
 
Less:
                       
Goodwill
   
55,638
     
55,638
     
55,638
 
Tangible common equity
   
552,319
     
542,929
     
517,587
 
                         
Reconciliation of Tangible Common Equity - Bank only:
                       
Total common equity
 
$
657,130
   
$
643,260
   
$
579,644
 
Less:
                       
Goodwill
   
55,638
     
55,638
     
55,638
 
Tangible common equity
   
601,492
     
587,622
     
524,006
 

(1)
Adjustments to net income are taxed at the company’s statutory tax rate of approximately 32% for 2018 and 45% for 2017, unless otherwise noted.

 

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Section 3: EX-99.2 (EXHIBIT 99.2)


Exhibit 99.2

Dime Community Bancshares Declares Quarterly Cash Dividend

Brooklyn, NY– April 26, 2018 – Dime Community Bancshares, Inc. (Nasdaq: DCOM) (the “Company”) announced that its Board of Directors has declared a quarterly cash dividend of $0.14 per share, payable on May 15, 2018, to all stockholders of record as of May 8, 2018.  This dividend is the 84th consecutive quarterly cash dividend paid by the Company.

ABOUT DIME COMMUNITY BANCSHARES, INC.
 
The Company had $6.40 billion in consolidated assets as of December 31, 2017, and is the parent company of Dime Community Bank (the “bank”). The bank was founded in 1864, is headquartered in Brooklyn, New York, and currently has 29 branches located throughout Brooklyn, Queens, the Bronx, Nassau County and Suffolk County, New York. More information on the Company and the bank can be found on Dime’s website at www.dime.com.

Contact: Avinash Reddy, Senior Vice President - Corporate Development and Treasurer, 718-782-6200, extension 5909.
 
 

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