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Northfield Bancorp, Inc. (NFBK)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 EPS of $0.19 grew 27% YoY and fell vs Q4 as the prior quarter benefited from a $3.4M ($0.06) one‑time property gain; net interest margin expanded 20 bps sequentially to 2.38% on lower funding costs and higher asset yields .
  • Results modestly beat consensus: EPS $0.19 vs $0.18*, revenue $32.23M vs $32.12M*; the revenue definition aligns with S&P Global’s operating revenue convention. The small beat was driven by lower interest expense and higher yields on MBS despite a higher loan loss provision* .
  • Core deposit growth (ex‑brokered) accelerated (+$133.6M QoQ) with deposit costs essentially flat (1.94% at period end), while loans declined 0.8% QoQ as the bank prudently managed multifamily concentration .
  • Asset quality remained solid (NPLs/Loans 0.48%), though provision/charge‑offs rose tied to small‑business unsecured C&I and updated multifamily assumptions; management continues close monitoring .
  • Capital returns remained active: completed a $5M repurchase in Q1 (440,150 shares) and authorized a new $10M program; $0.13 dividend declared (payable May 21, 2025) .

What Went Well and What Went Wrong

What Went Well

  • Net interest margin expanded to 2.38% from 2.18% in Q4 and 2.03% a year ago on “reducing our funding costs and increasing the yield on our interest‑earning assets,” supporting higher net interest income .
  • Core funding mix improved: deposits ex‑brokered increased $133.6M QoQ (13.8% annualized), aided by “new municipal relationships and new commercial customer relationships”; period‑end cost of deposits edged down to 1.94% .
  • Operating efficiency improved vs prior year (efficiency ratio 61.6% vs 71.4% YoY) with lower non‑interest expense YoY; management emphasized “prudently managing our operating expenses” .

What Went Wrong

  • Credit costs elevated: provision rose to $2.6M (vs $1.9M in Q4; $0.4M YoY) on higher net charge‑offs ($2.8M, mainly unsecured small‑business C&I) and model updates for multifamily (lower prepayments, higher LGD on downgrades) .
  • Non‑interest income fell sharply QoQ as Q4 included a $3.4M property gain; trading securities swung to a $0.3M loss with offsetting deferred comp expense .
  • Loans declined 0.8% QoQ (−$30.7M) led by multifamily, reflecting continued concentration management; non‑owner‑occupied CRE concentration stood at ~424% of risk‑based capital, which regulators could require additional capital/controls for if needed .

Financial Results

Headline vs. Estimates (S&P Global)

MetricQ1 2025 ActualConsensusSurprise
Diluted EPS ($)0.190.18*+0.01*
Revenue ($MM, SPGI definition)32.2332.12*+0.11 (+0.3%)*

Values with * retrieved from S&P Global.

Income, Margins, Credit – Trend Comparison

MetricQ1 2024Q3 2024Q4 2024Q1 2025
Diluted EPS ($)0.15 0.16 0.27 0.19
Net Interest Income ($MM)27.88 28.23 29.69 31.79
Non‑interest Income ($MM)3.38 3.58 7.00 3.02
Provision for Credit Losses ($MM)0.42 2.54 1.94 2.58
Net Interest Margin (%)2.03 2.08 2.18 2.38
Efficiency Ratio (%)71.43 64.07 56.75 61.57
NPLs / Total Loans (%)0.41 0.75 0.51 0.48
Net Charge‑offs ($MM)0.91 —2.00 2.80

Notes: Q3 net charge‑offs not disclosed in the cited summary tables.

Balance Sheet and Liquidity Highlights (Q1 2025)

  • Loans HFI, net: $3.99B (−0.8% QoQ); AFS securities: $1.25B (+13.2% QoQ) .
  • Deposits: $4.13B (−$6.5M QoQ); core deposits ex‑brokered +$133.6M QoQ; brokered −$140.1M QoQ .
  • Borrowed funds: $770.7M (from $727.8M) with laddered maturities; on‑hand liquidity ratio 24.3% .
  • CBLR: Company 12.08%, Bank 12.62% (well‑capitalized) .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Dividend per shareQ2 2025 payout$0.13 (Q4 declaration) $0.13 declared, payable May 21, 2025 Maintained
Share repurchase authorization2025$5.0M plan completed in Q1 2025 (440,150 shares) New $10.0M plan approved Apr 23, 2025 Raised
Revenue/EPS/Expense2025None providedNone provided—

No formal quantitative revenue/expense/EPS guidance provided in the press release/8‑K .

Earnings Call Themes & Trends

No Q1 2025 earnings call transcript was available in the document set; themes below reflect company press releases and 8‑K disclosures.

TopicPrevious Mentions (Q3 & Q4 2024)Current Period (Q1 2025)Trend
Net interest margin trajectoryQ3: NIM 2.08%, stable; Q4: NIM +10 bps to 2.18% with lower funding costs NIM 2.38% (+20 bps QoQ) on lower costs, higher yields on loans/MBS Improving
Deposit mix/costsQ3: cost of deposits 2.07% at 9/30; Q4: cost of deposits (ex‑brokered) 1.95% at 12/31 Core deposits +$133.6M QoQ; period‑end cost 1.94% Improving mix; cost stable-to-down
LiquidityQ3: unpledged AFS ~$597M; loans available ~$699M Unpledged AFS ~$1.12B; multifamily loans pledgeable ~$547M; on‑hand liquidity 24.3% Strengthened
Credit – C&I unsecuredNoted portfolio; provision elevated in Q3 $2.4M net charge‑offs in small‑business unsecured C&I; continued close monitoring Ongoing headwind
Multifamily/CRE concentrationConcentration, NPLs ticked up in Q3; stable in Q4 CRE concentration ~424% of risk‑based capital; risk‑rating downgrades in multifamily drove higher reserves Managed, but regulatory/credit focus
Capital returnQ3: buybacks exhausted; $0.13 dividend $5M buyback completed; new $10M authorized; $0.13 dividend More active

Management Commentary

  • “The Northfield team continued to focus on growing our franchise, deploying our strong capital base, and delivering solid financial performance for the quarter.” — Steven M. Klein, Chairman & CEO .
  • “Reducing our funding costs and increasing the yield on our interest‑earning assets [resulted] in higher net interest income and net interest margin.” .
  • “We remain committed to prudently managing our operating expenses, maintaining strong asset quality, and managing our strong capital levels through dividends and stock repurchases.” .

Q&A Highlights

  • No Q1 2025 earnings call transcript was available; no Q&A disclosures found in the filings set searched [Search through 2025-04-20 to 2025-05-15 returned none].

Estimates Context

  • EPS modest beat: $0.19 vs $0.18 consensus (3 est); revenue slight beat: $32.23M vs $32.12M consensus (3 est). Implies a clean, small upside despite higher provisioning, with beats driven by improved funding costs and asset yields* .
  • Given NIM improvement and core deposit momentum, street models likely raise NII/NIM assumptions; however, higher expected credit costs in unsecured C&I and multifamily (model changes/downgrades) may offset and keep EPS revisions modest* .

Values with * retrieved from S&P Global.

Key Takeaways for Investors

  • Core margin inflection is intact: NIM +35 bps YoY/+20 bps QoQ to 2.38% as deposit costs stabilize and mortgage‑backed yields rise—supporting NII growth even as balance sheet remains conservative .
  • Funding mix improved: core deposits up, brokered down; period‑end deposit cost 1.94% with new municipal/commercial relationships, positioning for further spread improvement if rates ease .
  • Credit remains the swing factor: elevated provision and net charge‑offs concentrated in unsecured small‑business C&I; multifamily risk‑rating downgrades warrant close monitoring despite low NPL levels (0.48%) .
  • Concentration/regulatory watch item: non‑owner‑occupied CRE at ~424% of risk‑based capital could drive supervisory attention, potentially impacting growth/capital allocation if additional buffers are requested .
  • Strong liquidity and capital with active capital return: 24.3% on‑hand liquidity; new $10M buyback plus $0.13 dividend provides downside support while management balances growth and risk .
  • Near‑term trading setup: modest beat, NIM momentum, and buyback authorize a constructive bias; sustained progress on deposit costs and benign credit prints are catalysts, while negative surprises in C&I/multifamily credit are the key risk .

Supporting Details and Additional Data

  • Net income: $7.9M in Q1 2025 vs $11.3M in Q4 2024 (prior quarter included $3.4M property gain) and $6.2M in Q1 2024 .
  • Deposits by type (Q1 2025 vs Q4 2024): Transaction $2.09B vs $1.99B; Savings $1.17B vs $1.18B; CDs $0.87B vs $0.97B; Brokered $123.3M vs $263.4M .
  • Borrowing ladder (ex‑overnight/sub debt): 2025 $160.7M (3.89%), 2026 $148.0M (4.36%), 2027 $173.0M (3.19%), 2028 $154.3M (3.96%) .

Sources: Q1 2025 earnings press release and detailed tables (and same as Ex.99.1 to 8‑K) ; Q1 2025 8‑K Items 2.02/8.01 and exhibits ; Q4 2024 8‑K/press release ; Q3 2024 8‑K/press release .