Kearny Financial
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Item 1. Business
Forward-Looking Statements
This Annual Report on Form 10-K contains forward-looking statements, which can be identified by the use of words such as “estimate,” “project,” “believe,” “intend,” “anticipate,” “plan,” “seek,” “expect” and words of similar meaning. These forward-looking statements include, but are not limited to:
•statements of our goals, intentions and expectations;
•statements regarding our business plans, prospects, growth and operating strategies;
•statements regarding the quality of our loan and investment portfolios; and
•estimates of our risks and future costs and benefits.
These forward-looking statements are based on current beliefs and expectations of our management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. We are under no duty to and do not take any obligation to update any forward-looking statements after the date of the Annual Report on Form 10-K.
The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statements:
•general economic conditions, either nationally or in our market areas, that are worse than expected;
•the imposition of tariffs or other domestic or international governmental policies and retaliatory responses;
•changes in the amount and trend of loan delinquencies and write-offs and changes in estimates and the methodologies for calculating the allowance for credit losses;
•our ability to access cost-effective funding;
•fluctuations in real estate values and both residential and commercial real estate market conditions;
•demand for loans and deposits in our market area;
•our ability to implement changes in our business strategies;
•competition among depository and other financial institutions;
•inflation and/or changes in the interest rate environment that reduce our margins and yields, or reduce the fair value of financial instruments or reduce the origination levels in our lending business, or increase the level of defaults, losses and prepayments on loans we have made and make whether held in portfolio or sold in the secondary markets;
•adverse changes in the securities markets;
•changes in laws or government regulations or policies affecting financial institutions, including changes in regulatory fees and capital requirements;
•changes in monetary or fiscal policies of the U.S. Government, including policies of the U.S. Treasury and the Federal Reserve Board;
•our ability to manage market risk, credit risk and operational risk in the current economic conditions;
•significant increases in our loan losses;
•our ability to enter new markets successfully and capitalize on growth opportunities;
•our ability to successfully integrate any assets, liabilities, clients, systems and management personnel we have acquired or may acquire into our operations and our ability to realize related revenue synergies and cost savings within expected time frames and any goodwill charges related thereto;
•changes in consumer demand, borrowing and savings habits;
•changes in accounting policies and practices, as may be adopted by bank regulatory agencies, the Financial Accounting Standards Board, the Securities and Exchange Commission or the Public Company Accounting Oversight Board;
•our ability to retain key employees;
•technological changes;
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•cyber-attacks, computer viruses and other technological risks that may breach the security of our websites or other systems to obtain unauthorized access to confidential information and destroy data or disable our systems;
•technological changes that may be more difficult or expensive than expected;
•the ability of third-party providers to perform their obligations to us;
•the ability of the U.S. Government to manage federal debt limits;
•changes in the financial condition, results of operations or future prospects of issuers of securities that we own; and
•other economic, competitive, governmental, regulatory and operational factors affecting our operations, pricing products and services described elsewhere in this Annual Report on Form 10-K.
Because of these and other uncertainties, our actual future results may be materially different from the results indicated by these forward-looking statements.
General
Kearny Financial Corp. (the “Company,” or “Kearny Financial”), is a Maryland corporation that is the holding company for Kearny Bank (the “Bank” or “Kearny Bank”), a nonmember New Jersey-chartered savings bank.
The Company is a unitary savings and loan holding company, regulated by the Board of Governors of the Federal Reserve System and conducts no significant business or operations of its own. The Bank’s deposits are federally insured by the Deposit Insurance Fund as administered by the Federal Deposit Insurance Corporation (“FDIC”) and the Bank is primarily regulated by the New Jersey Department of Banking and Insurance (“NJDBI”) and, as a nonmember bank, the FDIC. References in this Annual Report on Form 10‑K to the Company or Kearny Financial generally refer to the Company and the Bank, unless the context indicates otherwise. References to “we,” “us,” or “our” refer to the Bank or the Company, or both, as the context indicates.
The Company’s primary business is the ownership and operation of the Bank. The Bank is principally engaged in the business of attracting deposits from the general public and using these deposits, together with other funds, to originate or purchase loans for its portfolio and for sale into the secondary market. Our loan portfolio is primarily comprised of loans collateralized by commercial and residential real estate augmented by secured and unsecured loans to businesses and consumers. We also maintain a portfolio of investment securities, primarily comprised of U.S. agency mortgage-backed securities, obligations of state and political subdivisions, corporate bonds, asset-backed securities and collateralized loan obligations.
We operate from our administrative headquarters in Fairfield, New Jersey and other administrative locations throughout the State of New Jersey. As of June 30, 2026, we had 40 branch offices. The Company maintains a website at www.kearnybank.com. We make available through that website, free of charge, copies of our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, amendments to those reports and proxy materials as soon as is reasonably practicable after the Company electronically files those materials with, or furnishes them to, the Securities and Exchange Commission. You may access these materials by following the links under “Investor Relations” under the “Financials” tab at the Company’s website. Information on the Company’s website is not and should not be considered a part of this Annual Report on Form 10-K.
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Business Strategy
Our objective is to enhance long-term shareholder value by growing a higher-performing commercial banking franchise supported by relationship-based deposits, disciplined balance sheet management, technology-enabled operating efficiencies and strong risk management practices. We seek to leverage our strong capital position, experienced management team, customer-focused culture and technology investments to drive sustainable earnings growth while continuing to meet the financial needs of our clients and communities. The key components of our business strategy are as follows:
•Expand Commercial Banking Relationships
We continue to focus on expanding our commercial banking franchise by growing relationships with small and middle-market businesses and professionals. We seek to increase commercial loan production across targeted asset classes, including commercial and industrial ("C&I") loans and owner-occupied commercial real estate loans, while deepening treasury management and deposit relationships with our business clients. We have continued to invest in treasury management, corporate banking and business development capabilities to better serve commercial clients and increase relationship-based deposits. Our relationship-based approach, local decision-making and experienced commercial banking team enable us to provide customized solutions that support our clients' evolving financial needs.
•Grow and Deepen Core Deposit Relationships
A core element of our strategy is to attract and retain stable, relationship-based deposits that support long-term growth and funding stability. We remain focused on growing commercial operating accounts and consumer transaction accounts while expanding existing customer relationships through personalized service and tailored product offerings. To support these efforts, we have invested in experienced corporate banking and specialty deposit teams focused on attracting new relationship-based deposits and expanding client relationships. By increasing core deposit relationships and reducing reliance on higher-cost funding sources, we seek to strengthen franchise value, improve funding flexibility and enhance our net interest margin over time.
•Leverage Technology, Automation and Digital Innovation
Technology continues to play a critical role in our growth strategy and operating model. We are committed to investing in digital banking, process automation, data analytics, artificial intelligence and other emerging technologies that enhance the client experience, improve employee productivity and support scalable growth. Our digital capabilities enable customers to interact with the Bank through multiple channels while maintaining the personalized service that remains central to our relationship banking model. We expect ongoing investments in technology to drive efficiencies across lending, deposits, operations, risk management and customer engagement.
•Continue to Strengthen Asset Mix and Earnings Profile
We seek to enhance long-term profitability through disciplined balance sheet management and strategic loan portfolio growth. Our lending strategy emphasizes higher-return commercial and consumer loan categories, including C&I loans, owner-occupied commercial real estate loans and home equity products. This approach is intended to improve earning asset yields, enhance risk-adjusted returns and better position the Bank across varying interest rate environments while maintaining strong underwriting standards and credit quality.
•Drive Operational Efficiency and Improve Profitability
We are committed to continuously enhancing operating efficiency and improving shareholder returns. Our initiatives include streamlining processes, increasing technology utilization, optimizing staffing levels and evaluating our branch network to ensure that resources are aligned with customer preferences and market opportunities. Through these efforts, we seek to improve productivity, support revenue growth, control expenses and create a more efficient and scalable operating model. Consistent with this strategy, we consolidated three branch locations during fiscal 2026 while continuing to maintain a strong presence within our markets.
•Maintain Strong Capital, Liquidity and Risk Management
We remain committed to maintaining strong capital, liquidity and risk management practices that support the safety and soundness of the Bank while providing flexibility to pursue growth opportunities. We maintain capital levels above applicable regulatory requirements and internal targets and preserve substantial on- and off-balance sheet liquidity sources. Our disciplined approach to risk management supports long-term financial strength and positions the Bank to serve customers and communities through changing economic and operating environments.
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Financial statements
data from SEC XBRL filings. Values are as-reported; restatements supersede originals. Values reported in .
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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
General
This discussion and analysis reflects Kearny Financial Corp.’s consolidated financial statements and other relevant statistical data, and is intended to enhance your understanding of our financial condition and results of operations. You should read the information in this section in conjunction with the business and financial information regarding Kearny Financial Corp. and the audited consolidated financial statements and notes thereto contained in this Annual Report on Form 10-K.
Critical Accounting Policies and Estimates
Our accounting policies are integral to understanding the results reported. We describe them in detail in Note 1 to our audited consolidated financial statements. In preparing the audited consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the dates of the Consolidated Statements of Financial Condition and revenues and expenses for the periods then ended. Actual results could differ significantly from those estimates. A material estimate that is particularly susceptible to significant changes relates to the determination of the allowance for credit losses.
Allowance for Credit Losses. The determination of our allowance for credit losses on loans (“ACL”) is considered a critical accounting estimate by management because of the high degree of judgment involved in determining qualitative loss factors, the subjectivity of the assumptions used, and the potential for changes in the forecasted economic environment that could result in changes to the amount of the recorded ACL. See Note 1 to our audited consolidated financial statements for a detailed discussion of our accounting policies and methodologies for establishing the ACL.
Management believes the following information may enable investors to better understand the changes in our ACL. Our ACL totaled $45.5 million and $46.2 million at June 30, 2026 and 2025, respectively. The $695,000 decrease in our ACL was largely attributable to net charge-offs of $2.4 million, partially offset by a provision for credit losses of $1.7 million primarily driven by loan growth and an increase in reserves for individually evaluated loans. The quantitative component of our ACL, which is largely based on the national unemployment rate forecast, increased $152,000. The qualitative component of our ACL, which is largely based on management’s judgment of qualitative loss factors, increased $481,000.
Our ACL totaled $45.5 million at June 30, 2026 and the amount allocated to our collectively evaluated multi-family and nonresidential mortgage loans was $29.3 million, of which $20.4 million was attributable to qualitative loss factors. Changes in management’s judgment of qualitative loss factors could result in a significant change to the ACL. As described in Note 1, qualitative loss factors are applied to each portfolio segment with the amounts judgmentally determined by the relative risk to the most severe loss periods identified in the historical loan charge-offs of a peer group of similar-sized regional banks. At June 30, 2026, the weighted average historical loss rate for multi-family and nonresidential mortgages loans during the most severe peer group loss periods was 1.62%.
Management performed a hypothetical sensitivity analysis to understand the impact of a change in a key input on our ACL. At June 30, 2026, if the four-quarter national unemployment rate forecast had been 9% rather than an average of approximately 4.2%, our ACL as a percent of total loans would have increased 56 basis points from 0.77% to 1.33%. This sensitivity analysis includes the impact to both the quantitative and qualitative components of our ACL. Changes in quantitative inputs and qualitative loss factors may not occur in the same direction or magnitude across all segments of our loan portfolio and deterioration in some quantitative inputs and qualitative loss factors may offset improvement in others. This sensitivity analysis does not represent a change to our expectations of the economic environment but provides a hypothetical result to assess the sensitivity of the ACL to a change in a key input. This sensitivity analysis does not incorporate changes to management’s judgment of qualitative loss factors.
Our ACL on individually analyzed loans is determined on an individual basis using the present value of expected cash flows discounted using the loan’s effective interest rate or, for collateral-dependent loans, the fair value of the collateral, less estimated selling costs, as applicable. Our ACL on individually analyzed loans decreased $1.3 million during the year ended June 30, 2026.
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Financial Overview
The following financial information and other data in this section are derived from our audited consolidated financial statements and should be read together therewith:
| At June 30, | |||||||||||||||||
| 2026 | 2025 | 2024 | |||||||||||||||
| (In Thousands) | |||||||||||||||||
| Balance Sheet Data: | |||||||||||||||||
| Cash and equivalents | $ | 114,823 | $ | 167,269 | $ | 63,864 | |||||||||||
| Assets | 7,682,205 | 7,740,450 | 7,683,461 | ||||||||||||||
| Net loans receivable | 5,829,829 | 5,766,746 | 5,687,848 | ||||||||||||||
| Investment securities available for sale | 964,369 | 1,012,969 | 1,072,833 | ||||||||||||||
| Investment securities held to maturity | 106,814 | 120,217 | 135,742 | ||||||||||||||
| Goodwill | 113,525 | 113,525 | 113,525 | ||||||||||||||
| Deposits | 5,709,625 | 5,675,217 | 5,158,123 | ||||||||||||||
| Borrowings | 1,150,000 | 1,256,491 | 1,709,789 | ||||||||||||||
| Stockholders' equity | 766,670 | 745,962 | 753,571 | ||||||||||||||
| For the Years Ended June 30, | |||||||||||||||||
| 2026 | 2025 | 2024 | |||||||||||||||
| (Dollars in Thousands, Except Per Share Amounts) | |||||||||||||||||
| Summary of Operations: | |||||||||||||||||
| Interest income | $ | 324,313 | $ | 324,476 | $ | 328,868 | |||||||||||
| Interest expense | 169,030 | 189,533 | 186,274 | ||||||||||||||
| Net interest income | 155,283 | 134,943 | 142,594 | ||||||||||||||
| Provision for credit losses | 1,698 | 2,366 | 6,226 | ||||||||||||||
| Net interest income after provision for credit losses | 153,585 | 132,577 | 136,368 | ||||||||||||||
| Non-interest income | 22,825 | 19,052 | (1,993) | ||||||||||||||
| Non-interest expenses | 129,008 | 120,630 | 215,151 | ||||||||||||||
| Income (loss) before taxes | 47,402 | 30,999 | (80,776) | ||||||||||||||
| Income tax expense | 11,138 | 4,924 | 5,891 | ||||||||||||||
| Net income (loss) | $ | 36,264 | $ | 26,075 | $ | (86,667) | |||||||||||
| Per Share Data: | |||||||||||||||||
| Net income (loss) per share - Basic | $ | 0.58 | $ | 0.42 | $ | (1.39) | |||||||||||
| Net income (loss) per share - Diluted | $ | 0.57 | $ | 0.42 | $ | (1.39) | |||||||||||
| Weighted average number of common shares outstanding (in thousands): | |||||||||||||||||
| Basic | 62,866 | 62,508 | 62,444 | ||||||||||||||
| Diluted | 63,220 | 62,716 | 62,444 | ||||||||||||||
| Cash dividends per share | $ | 0.44 | $ | 0.44 | $ | 0.44 | |||||||||||
Dividend payout ratio(1) | 77.1 | % | 106.1 | % | (31.9) | % | |||||||||||
________________________________________
(1)Represents cash dividends declared divided by net income (loss).
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| At or For the Years Ended June 30, | |||||||||||||||||
| 2026 | 2025 | 2024 | |||||||||||||||
| Performance Ratios: | |||||||||||||||||
| Return on average assets (ratio of net income to average total assets) | 0.48 | % | 0.34 | % | (1.10) | % | |||||||||||
| Return on average equity (ratio of net income to average total equity) | 4.80 | % | 3.49 | % | (10.51) | % | |||||||||||
Return on average tangible equity (ratio of net income to average tangible equity)(1) | 5.71 | % | 4.18 | % | (13.64) | % | |||||||||||
| Net interest rate spread | 1.79 | % | 1.47 | % | 1.57 | % | |||||||||||
| Net interest margin | 2.18 | % | 1.88 | % | 1.94 | % | |||||||||||
| Average interest-earning assets to average interest-bearing liabilities | 116.50 | % | 115.21 | % | 114.73 | % | |||||||||||
Efficiency ratio(2) | 72.43 | % | 78.33 | % | 153.02 | % | |||||||||||
| Non-interest expense to average assets | 1.70 | % | 1.58 | % | 2.73 | % | |||||||||||
| Asset Quality Ratios: | |||||||||||||||||
| Non-performing loans to total loans | 0.82 | % | 0.78 | % | 0.70 | % | |||||||||||
| Non-performing assets to total assets | 0.70 | % | 0.59 | % | 0.52 | % | |||||||||||
| Net charge-offs to average loans outstanding | 0.04 | % | 0.02 | % | 0.17 | % | |||||||||||
| Allowance for credit losses to total loans | 0.77 | % | 0.79 | % | 0.78 | % | |||||||||||
| Allowance for credit losses to non-performing loans | 94.99 | % | 101.30 | % | 112.68 | % | |||||||||||
| Capital Ratios: | |||||||||||||||||
| Average equity to average assets | 9.97 | % | 9.77 | % | 10.46 | % | |||||||||||
| Equity to assets at period end | 9.98 | % | 9.64 | % | 9.81 | % | |||||||||||
Tangible equity to tangible assets at period end(3) | 8.62 | % | 8.27 | % | 8.43 | % | |||||||||||
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(1)Average tangible equity equals average total stockholders’ equity reduced by average goodwill and average core deposit intangible assets.
(2)Efficiency ratio equals non-interest expense divided by the sum of net interest income and non-interest income.
(3)Tangible equity equals total stockholders’ equity reduced by goodwill and core deposit intangible assets.
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Comparison of Financial Condition at June 30, 2026 and June 30, 2025
Executive Summary. Total assets decreased by $58.2 million, or 0.8%, to $7.68 billion at June 30, 2026 from $7.74 billion at June 30, 2025. The decrease primarily reflected decreases in cash and cash equivalents and investment securities, partially offset by an increase in net loans receivable.
Investment Securities. Investment securities available for sale decreased by $48.6 million to $964.4 million at June 30, 2026 from $1.01 billion at June 30, 2025. This decrease was largely the result of principal repayments of $322.7 million, partially offset by purchases of $258.3 million and a $15.6 million increase in the fair value of the portfolio.
Investment securities held to maturity decreased by $13.4 million to $106.8 million at June 30, 2026 from $120.2 million at June 30, 2025. The decrease was largely the result of principal repayments of $13.5 million.
Additional information regarding investment securities at June 30, 2026 is presented under “Item 1. Business” of this Annual Report on Form 10-K, as well as in Note 3 to the audited consolidated financial statements.
Loans Held-for-Sale. Loans held-for-sale totaled $6.0 million at June 30, 2026 as compared to $5.9 million at June 30, 2025 and are reported separately from the balance of net loans receivable. Loans held-for-sale consisted of residential mortgage loans in both respective periods. During the year ended June 30, 2026, we sold $128.2 million of residential mortgage loans, resulting in a net gain on sale of $932,000.
Net Loans Receivable. Net loans receivable increased by $63.1 million, or 1.1%, to $5.83 billion at June 30, 2026 from $5.77 billion at June 30, 2025. The increase reflected growth across several lending categories, including commercial and industrial loans and construction loans, partially offset by a decline in multi-family mortgage loans resulting primarily from repayments and payoffs. The resulting shift in portfolio composition is consistent with our ongoing loan portfolio remix strategy and focus on expanding commercial banking relationships. Detail regarding the change in the loan portfolio is presented below:
| June 30, 2026 | June 30, 2025 | Increase/ (Decrease) | |||||||||||||||
| (In Thousands) | |||||||||||||||||
| Commercial loans: | |||||||||||||||||
| Multi-family mortgage | $ | 2,499,894 | $ | 2,709,654 | $ | (209,760) | |||||||||||
| Nonresidential mortgage | 1,019,445 | 986,556 | 32,889 | ||||||||||||||
| Commercial and industrial | 223,927 | 138,755 | 85,172 | ||||||||||||||
| Construction | 263,200 | 177,713 | 85,487 | ||||||||||||||
| Total commercial loans | 4,006,466 | 4,012,678 | (6,212) | ||||||||||||||
| One- to four-family residential mortgage | 1,789,865 | 1,748,591 | 41,274 | ||||||||||||||
| Consumer loans: | |||||||||||||||||
| Home equity loans | 79,844 | 50,737 | 29,107 | ||||||||||||||
| Other consumer | 2,387 | 2,533 | (146) | ||||||||||||||
| Total consumer loans | 82,231 | 53,270 | 28,961 | ||||||||||||||
| Total loans | 5,878,562 | 5,814,539 | 64,023 | ||||||||||||||
| Unaccreted yield adjustments | (3,237) | (1,602) | (1,635) | ||||||||||||||
| Allowance for credit losses | (45,496) | (46,191) | 695 | ||||||||||||||
| Net loans receivable | $ | 5,829,829 | $ | 5,766,746 | $ | 63,083 | |||||||||||
Commercial loan origination volume for the year ended June 30, 2026 totaled $439.7 million, consisting of $166.2 million of commercial mortgage loan originations, $118.5 million of commercial and industrial loan originations and $155.1 million of construction loan disbursements. Purchases of commercial business loans totaled $93.8 million for the same period.
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One- to four-family residential mortgage loan origination volume, excluding loans held-for-sale, totaled $154.0 million for the year ended June 30, 2026 and was supplemented with loan purchases totaling $65.6 million. Home equity loan and line of credit origination volume for the same period totaled $43.5 million.
Additional information about our loans at June 30, 2026 is presented under “Item 1. Business” of this Annual Report on Form 10-K, as well as in Note 4 to the audited consolidated financial statements.
Nonperforming Assets. Nonperforming assets increased $7.8 million to $53.4 million, or 0.70% of total assets, at June 30, 2026 from $45.6 million, or 0.59% of total assets, at June 30, 2025. The increase in nonperforming assets was largely attributable to two foreclosed properties with an aggregate carrying value of $5.5 million that were transferred into other real estate owned. The remaining change was primarily attributable to an increase in nonperforming multi-family mortgage loans, partially offset by a decrease in nonperforming residential mortgage loans.
Additional information about nonperforming loans and reportable loan modifications at June 30, 2026 is presented under “Item 1. Business” of this Annual Report on Form 10-K, as well as in Note 4 to the audited consolidated financial statements.
Allowance for Credit Losses. At June 30, 2026, the ACL totaled $45.5 million, or 0.77% of total loans, reflecting a decrease of $695,000 from $46.2 million, or 0.79% of total loans, at June 30, 2025. The decrease was largely attributable to net charge-offs of $2.4 million, partially offset by a provision for credit losses of $1.7 million.
Additional information about the allowance for credit losses at June 30, 2026 is presented under “Item 1. Business” of this Annual Report on Form 10-K, as well as in Note 1 and Note 5 to the audited consolidated financial statements.
Other Assets. The aggregate balance of other assets, including premises and equipment, FHLB stock, interest receivable, goodwill, core deposit intangibles, bank owned life insurance, deferred income taxes, OREO and other assets, decreased by $7.0 million to $660.3 million at June 30, 2026 from $667.3 million at June 30, 2025. The decrease in other assets largely reflected a decrease in the market value of interest rate derivatives and a decrease in FHLB stock, partially offset by an increase in BOLI and the transfer of two foreclosed properties to other real estate owned. The remaining change generally reflected normal operating fluctuations within these line items.
Deposits. Total deposits increased by $34.4 million, or 0.6%, to $5.71 billion at June 30, 2026 from $5.68 billion at June 30, 2025. Included in total deposits are brokered certificates of deposits (“CDs”) of $757.2 million and $757.7 million at June 30, 2026 and 2025, respectively. The increase was driven by growth in deposits from our branch network and digital channels. Deposit balances at June 30, 2026 reflect a migration of $239.9 million from a consumer interest bearing product to a non-interest bearing product as part of the Company’s repricing strategy. The following table sets forth the distribution of, and changes in, deposits, by type, at the dates indicated:
| June 30, 2026 | June 30, 2025 | Increase/ (Decrease) | |||||||||||||||
| (In Thousands) | |||||||||||||||||
| Non-interest-bearing deposits | $ | 788,015 | $ | 582,045 | $ | 205,970 | |||||||||||
| Interest-bearing deposits: | |||||||||||||||||
| Interest-bearing demand | 2,214,432 | 2,362,222 | (147,790) | ||||||||||||||
| Savings | 766,502 | 754,376 | 12,126 | ||||||||||||||
| Certificates of deposit (retail) | 1,183,427 | 1,218,920 | (35,493) | ||||||||||||||
| Certificates of deposit (brokered) | 757,249 | 757,654 | (405) | ||||||||||||||
| Interest-bearing deposits | 4,921,610 | 5,093,172 | (171,562) | ||||||||||||||
| Total deposits | $ | 5,709,625 | $ | 5,675,217 | $ | 34,408 | |||||||||||
Uninsured deposits totaled $2.25 billion as of June 30, 2026, compared to $1.99 billion as of June 30, 2025. Excluding collateralized deposits of state and local governments, and deposits of the Bank’s wholly-owned subsidiary and holding company, uninsured deposits totaled $851.0 million, or 14.9% of total deposits, at June 30, 2026 compared to $813.8 million, or 14.3% of total deposits, at June 30, 2025.
Additional information about our deposits at June 30, 2026 is presented under “Item 1. Business” of this Annual Report on Form 10-K, as well as in Note 9 to the audited consolidated financial statements.
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Borrowings. The balance of borrowings decreased by $106.5 million, or 8.5%, to $1.15 billion at June 30, 2026 from $1.26 billion at June 30, 2025 which included overnight borrowings totaling $200.0 million and $150.0 million at June 30, 2026 and 2025, respectively. The decrease was primarily driven by a net decrease in FHLB and other borrowings.
Additional information about our borrowings at June 30, 2026 is presented under “Item 1. Business” of this Annual Report on Form 10-K, as well as in Note 10 to the audited consolidated financial statements.
Other Liabilities. The balance of other liabilities, including advance payments by borrowers for taxes and other miscellaneous liabilities, decreased by $6.9 million to $55.9 million at June 30, 2026 from $62.8 million at June 30, 2025. The change in the balance of other liabilities generally reflected normal operating fluctuations within these line items.
Stockholders’ Equity. Stockholders’ equity increased by $20.7 million to $766.7 million at June 30, 2026 from $746.0 million at June 30, 2025. The increase in stockholders’ equity during the year ended June 30, 2026 largely reflected net income of $36.3 million and $9.1 million in after-tax other comprehensive income, partially offset by $28.0 million in cash dividends. Other comprehensive income during the year ended June 30, 2026 was driven by an increase in the fair value of our available for sale securities, partially offset by a decrease in the fair value of our derivatives portfolio.
Book value per share increased by $0.29 to $11.84 at June 30, 2026 while tangible book value per share increased by $0.30 to $10.07 at June 30, 2026. These increases were driven by the increase in stockholders’ equity, as described above.
Comparison of Operating Results for the Years Ended June 30, 2026 and June 30, 2025
Net Income. Net income for the year ended June 30, 2026 was $36.3 million, or $0.57 per diluted share, an increase of $10.2 million from net income of $26.1 million, or $0.42 per diluted share, for the year ended June 30, 2025. The increase in net income reflected increases in net interest income and non-interest income, partially offset by increases in non-interest expense and income taxes.
Net Interest Income. Net interest income increased by $20.3 million to $155.3 million for the year ended June 30, 2026. The increase between the comparative periods resulted from a decrease of $20.5 million in interest expense, partially offset by a decrease of $163,000 in interest income. Included in net interest income for the years ended June 30, 2026 and 2025, respectively, was purchase accounting accretion of $2.2 million and $2.4 million and loan prepayment penalty income of $2.1 million and $783,000.
Net interest margin increased 30 basis points to 2.18% for the year ended June 30, 2026, from 1.88% for the year ended June 30, 2025. The increase reflected higher loan yields and balances and lower costs on interest-bearing liabilities, partially offset by lower yields and balances on investment securities and other interest-earning assets.
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Details surrounding the composition of, and changes to, net interest income are presented in the table below which reflects the components of the average balance sheet and of net interest income for the periods indicated. We derived the average yields and costs by dividing income or expense by the average balance of assets or liabilities, respectively, for the years presented with daily balances used to derive average balances. No tax equivalent adjustments have been made to yield or costs. Non-accrual loans were included in the calculation of average balances, however interest receivable on these loans has been fully reserved for and therefore not included in interest income. The yields and costs set forth below include the effect of deferred fees, discounts and premiums that are amortized or accreted to interest income or expense.
| For the Years Ended June 30, | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Average Balance | Interest | Average Yield/ Cost | Average Balance | Interest | Average Yield/ Cost | Average Balance | Interest | Average Yield/ Cost | |||||||||||||||||||||||||||||||||||||||||||||
| (Dollars in Thousands) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Interest-earning assets: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Loans receivable (1) | $ | 5,806,182 | $ | 271,445 | 4.68 | % | $ | 5,789,583 | $ | 262,992 | 4.54 | % | $ | 5,752,496 | $ | 256,007 | 4.45 | % | |||||||||||||||||||||||||||||||||||
Taxable investment securities(2) | 1,200,665 | 46,976 | 3.91 | 1,270,262 | 53,247 | 4.19 | 1,438,200 | 63,313 | 4.40 | ||||||||||||||||||||||||||||||||||||||||||||
Tax-exempt securities (2) | 5,800 | 139 | 2.39 | 9,791 | 234 | 2.39 | 14,718 | 336 | 2.28 | ||||||||||||||||||||||||||||||||||||||||||||
Other interest-earning assets(3) | 113,880 | 5,753 | 5.05 | 119,224 | 8,003 | 6.71 | 131,019 | 9,212 | 7.03 | ||||||||||||||||||||||||||||||||||||||||||||
| Total interest-earning assets | 7,126,527 | 324,313 | 4.55 | 7,188,860 | 324,476 | 4.51 | 7,336,433 | 328,868 | 4.48 | ||||||||||||||||||||||||||||||||||||||||||||
| Non-interest-earning assets | 455,386 | 459,986 | 541,859 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Total assets | $ | 7,581,913 | $ | 7,648,846 | $ | 7,878,292 | |||||||||||||||||||||||||||||||||||||||||||||||
| Interest-bearing liabilities: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Interest-bearing demand | $ | 2,334,641 | $ | 58,220 | 2.49 | ||||||||||||||||||||||||||||||||||||||||||||||||
Recent insider activity
| Date | Insider | Role | Action | Shares | Price | Value |
|---|---|---|---|---|---|---|
| 2026-08-10 | MONTANARO LEOPOLD W | Director | Buy | +4,773 | $9.46 | $45,153 |
| 2026-07-27 | Fields Curtland E | Director | Buy | +14,700 ×4 | $9.41 | $138,274 |
| 2026-06-18 | Fields Curtland E | Director | Buy | +3,600 ×3 | $8.41 | $30,268 |
| 2026-06-17 | Fields Curtland E | Director | Buy | +4,950 | $8.34 | $41,258 |
| 2026-06-12 | Fields Curtland E | Director | Buy | +4,950 | $8.71 | $43,137 |
| 2026-06-11 | Wong-Zaza Melvina | Director | Buy | +3,500 | $8.57 | $30,012 |
| 2026-06-10 | Fields Curtland E | Director | Buy | +4,800 | $8.61 | $41,327 |
| 2026-06-09 | Joyce Patrick M | EVP and CLO | Sell | -2,500 ×2 | $8.46 | -$21,148 |
| 2026-06-08 | Fields Curtland E | Director | Buy | +3,000 ×4 | $8.40 | $25,201 |
Source: SEC Form 4 filings.
Next expected filings
- ~2026-11-05 10-Q expected by 2026-11-08 (in 74 days)
- ~2027-02-05 10-Q expected by 2027-02-08 (in 166 days)
- ~2027-05-07 10-Q expected by 2027-05-10 (in 257 days)
- ~2027-08-20 10-K expected by 2027-08-22 (in 362 days)
Predicted from historical filing cadence; not an SEC commitment.
Recent SEC filings
- 2026-08-21 10-K Annual Report
- 2026-07-23 8-K Earnings Release; Regulation FD Disclosure; Other Events; Financial Statements and Exhibits
- 2026-05-07 10-Q Quarterly Report
- 2026-04-23 8-K Earnings Release; Regulation FD Disclosure; Other Events; Financial Statements and Exhibits
- 2026-02-05 10-Q Quarterly Report
- 2026-01-22 8-K Earnings Release; Regulation FD Disclosure; Other Events; Financial Statements and Exhibits
- 2025-11-05 10-Q Quarterly Report
- 2025-10-23 8-K Earnings Release; Regulation FD Disclosure; Other Events; Financial Statements and Exhibits
- 2025-08-21 10-K Annual Report
- 2025-07-24 8-K Earnings Release; Regulation FD Disclosure; Other Events; Financial Statements and Exhibits
- 2025-06-18 8-K Officer/Director Change; Financial Statements and Exhibits
- 2025-05-07 10-Q Quarterly Report
- 2025-04-24 8-K Earnings Release; Regulation FD Disclosure; Other Events; Financial Statements and Exhibits
- 2025-02-06 10-Q Quarterly Report
- 2025-01-30 8-K Earnings Release; Regulation FD Disclosure; Other Events; Financial Statements and Exhibits