Kearny Financial · NASDAQ:KRNY
Kearny Financial — Q3 2024 Earnings Presentation
19 slides from Kearny Financial's earnings presentation, Apr 25, 2024
Slide 1: Investor Presentation Third Quarter Fiscal 2024
I N V E S T O R P R E S E N TAT I O N THIRD QUARTER FISCAL 2024 AP R I L 25, 2024
Slide 2: Forward Looking Statements & Financial Measures
Forward Looking Statements & Financial Measures This presentation may include certain “forward-looking statements,” which are made in good faith by Kearny Financial Corp. (the “Company”) pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-l
Slide 3: Kearny Financial Corp.
Kearny Financial Corp. NASDAQ: KRNY Headquartered in Fairfield, NJ 43 full-service branches1 in New Jersey and New York City Active acquirer, having completed 7 whole-bank acquisitions since 1999 1 As of March 31, 2024. Source: S&P Global Market Intelligence & Company Filings. 3
Slide 4: 140 Years of Serving our Communities and Clients
140 Years of Serving our Communities and Clients 4
Slide 5: 3Q24 Financial Highlights
3Q24 Financial Highlights Net Income Net Interest Income Diluted EPS $7.4 million $34.3 million $0.12 Total Assets Total Loans1 Total Deposits $7.8 billion $5.8 billion $5.2 billion 3Q24 Highlights: Net Interest Margin - Compression slowed, declining five basis points from the prior quarter BOLI Res
Slide 6: Capital Strength
Capital Strength Equity Capitalization Level Regulatory Capital Ratios1,2 15.45% 14.68% 14.68% 14.16% 10.78% 10.65% 10.74% 10.83% 10.37% 11.73% 11.53% 9.65% 9.07% 8.02% 8.35% 8.20% 8.26% 8.34% 3Q23 4Q23 1Q24 2Q24 3Q24 Tier 1 Common Equity Tier 1 Risk-Based Total Risk-Based Leverage Tier 1 Capital Ca
Slide 7: Conservative Underwriting Culture
Conservative Underwriting Culture Comprehensive CRE / Multifamily Underwriting Multi-faceted Loan Review & Stress Testing Highly disciplined LTV and DSCR standards Semi-annual third-party loan-level stress testing and annual Interest rates stressed a minimum of +300bps at capital-based stress testin
Slide 8: Track Record of Strong Credit Performance
Track Record of Strong Credit Performance Net Charge-offs to Average Total Loans Global COVID-19 Financial Pandemic Crisis Cumulative charge-offs for KRNY between 2006 and 3Q24 were minimal, totaling $35.1 million. 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Slide 9: Diversified Loan Portfolio
Diversified Loan Portfolio Loan Composition1 Loan Trend Geographic Distribution2 C&I ($ millions) Construction Other 2.6% 4.8% 4.0% 1-4 Family $5,976 $5,850 Pennsylvania $5,760 $5,757 $5,775 30.2% 5.9% CRE $1,003 New York 16.7% $969 $947 $947 $966 34.4% QTD Yield $2,836 $2,762 $2,699 $2,651 $2,645 L
Slide 10: Multifamily Loan Portfolio
Multifamily Loan Portfolio Multifamily Loan Portfolio Composition1 New York City (“NYC”) Multifamily1 Outside NYC Multifamily Portfolio: $1.2 billion NYC 52.9% 100% NYC Rent Average Loan Balance: $3.45 million Regulated 3.7% Weighted Average LTV: 62.7% Nonperforming Loans / Total MF Loans: 0.4% Tota
Slide 11: NYC Multifamily Loan Portfolio
NYC Multifamily Loan Portfolio Independent Market Research Report Data Staten Pricing Drop from Peak Pricing2 Island 0.4% Rent Stabilized Bronx Location Building Value Change 9.5% Bronx (29%) Brooklyn (7%) Manhattan (below 96th St) (37%) Northern Manhattan (above 96th St) (51%) Total Queens (22%) Ma
Slide 12: CRE Loan Detail
CRE Loan Detail CRE Portfolio by Collateral Type1 CRE Loan Geographic Distribution1 Other Medical 2.6% 3.8% Retail 36.3% Pennsylvania Specialty & Other 4.8% 2.0% Industrial New Jersey 16.7% Total CRE LTV 56.2% $1.0 B New York (Ex. 52% Brooklyn) 26.5% Office Mixed Use 15.1% 26.1% Brooklyn 9.9% Source
Slide 13: Office Portfolio
Office Portfolio Office Portfolio by Contractual Maturity1 Office Loan Geographic Distribution1 ($ millions) ($ millions) Other 3.1% Manhattan $60 22.4% $50 $40 New York (Ex. Manhattan) $30 4.5% Total Office $49 $20 $37 $146 M $17 $10 $22 $6 $10 $5 $- 2024 2025 2026 2027 2028 2029 2030+ New Jersey 7
Slide 14: Asset Quality Metrics
Asset Quality Metrics Net Charge-Offs / Average Loans Non-Performing Assets / Total Assets 1.00% 0.40% 0.29% 0.30% Increase driven by a single commercial real 0.75% 0.69% 0.69% estate relationship 0.64% 0.63% 0.20% 0.15% 0.50% 0.10% 0.02% 0.01% 0.01% 0.50% 0.00% -0.10% 0.25% 3Q23 4Q23 1Q24 2Q24 3Q24
Slide 15: Granular Deposit Franchise
Granular Deposit Franchise Deposit Composition1 Deposit Trend ($ millions) Interest Bearing $5,803 $5,629 $5,434 Savings DDA $5,320 $5,209 12.1% $618 $610 45.1% $595 $584 $586 $2,286 $2,253 $2,237 $2,348 QTD Cost $2,349 Wholesale of Deposits $811 $749 $689 $646 $630 CDs 2.74% $761 $640 $613 $458 $40
Slide 16: Liquidity Available for Uninsured Deposits
Liquidity Available for Uninsured Deposits Estimated Uninsured Deposits Analysis2 Liquidity Capacity2 Estimated Uninsured Deposit Analysis ($ millions) Sources of Liquidity Liquidity Funding Available 1 Estimated Uninsured Deposits $ 1,761 ($ millions) Capacity Utilized Capacity Less: Collateralized
Slide 17: Investment Securities
Investment Securities Securities Composition1 AFS/HTM & Effective Duration Securities Average Balance & Yield Trend ($ millions) Municipal Bonds 1.1% Corporate Bonds 4.27% 4.42% 4.46% 10.1% 3.95% 4.10% HTM , 11.3% QTD Yield Agency on Securities MBS 4.46% 49.0% AFS , 88.7% $1,576 $1,546 $1,532 $1,524
Slide 18: Best-in-Class Operating Efficiency
Best-in-Class Operating Efficiency Non-interest Expense to Average Assets Deposits per Branch 2.00% ($ millions) 1.8x $130 $131 1.86% 1.90% $121 121 $114 1.80% 101 $96 1.72% 1.73% 1.76% $75 1.70% 81 $74 $68 61 1.64% 1.60% 1.61% 41 1.53% 1.50% 21 1.48% 1.40% 1 2017 2018 2019 2020 2021 2022 2023 3Q24
Slide 19: Best-in-Class Technology Embedded Throughout the Organization
Best-in-Class Technology Embedded Throughout the Organization 19