NEW YORK, July 25, 2025 (GLOBE NEWSWIRE) -- Ponce Financial Group, Inc., (the "Company") (NASDAQ:PDLB), the holding company for Ponce Bank (the "Bank"), today announced results for the second quarter of 2025.

Second Quarter 2025 Highlights (Compared to Prior Periods):

Net income available to common stockholders was $5.8 million, or $0.25 per diluted share for the three months ended June 30, 2025, as compared to net income available to common stockholders of $5.7 million, or $0.25 per diluted share for the three months ended March 31, 2025, and net income available to common stockholders of $3.1 million, or $0.14 per diluted share for the three months ended June 30, 2024. Total net income for the three months ended June 30, 2025, was $6.1 million. The Company paid dividends of $0.3 million on its preferred stock during the three months ended June 30, 2025.
Included in the $5.8 million of net income available to common stockholders for the second quarter of 2025 results is $45.9 million in interest and dividend income and $2.1 million in non-interest income, offset by $21.4 million in interest expense, $16.9 million in non-interest expense, $1.9 million in provision for income taxes, $1.6 million in provision for credit losses and $0.3 million in dividends on preferred shares.
Net interest income of $24.4 million for the second quarter of 2025 increased $2.2 million, or 10.01%, from the prior quarter and increased $6.5 million, or 36.43%, from the same quarter last year.
Net interest margin was 3.27% for the second quarter of 2025, versus 2.98% for the prior quarter and 2.62% for the same quarter last year.

Six Months 2025 Highlights (Compared to 2024):

Net income available to common stockholders was $11.5 million, or $0.50 per diluted share for the six months ended June 30, 2025, as compared to net income available to common stockholders of $5.5 million, or $0.25 per diluted share for the six months ended June 30, 2024. Total net income for the six months ended June 30, 2025, was $12.1 million. The Company paid dividends of $0.6 million on its preferred stock during the six months ended June 30, 2025.
Net interest income for the six months ended June 30, 2025, was $46.6 million, an increase of $9.9 million, or 26.96%, compared to $36.7 million for the six months ended June 30, 2024.
Non-interest income for the six months ended June 30, 2025, was $4.4 million, an increase of $0.5 million, or 12.01%, from $4.0 million for the six months ended June 30, 2024.
Non-interest expense for the six months ended June 30, 2025, was $33.8 million, an increase of $0.3 million, or 0.99%, compared to $33.4 million for the six months ended June 30, 2024.
Cash and equivalents were $126.6 million as of June 30, 2025, a decrease of $13.2 million, or 9.44%, from $139.8 million as of December 31, 2024.
Securities totaled $433.4 million as of June 30, 2025, a decrease of $39.5 million, or 8.35%, from $472.9 million as of December 31, 2024, primarily due to regular principal payments, the call of two available-for-sale securities in the total amount of $6.0 million and the maturity of one held-for-sale security in the amount of $10.0 million.
Net loans receivable were $2.46 billion as of June 30, 2025, an increase of $172.1 million, or 7.53%, from $2.29 billion as of December 31, 2024.
Deposits were $2.04 billion as of June 30, 2025, an increase of $157.3 million, or 8.35%, from $1.88 billion as of December 31, 2024.

President and Chief Executive Officer's Comments

Carlos P. Naudon, Ponce Financial Group, Inc.'s President and CEO, stated "We continue to execute on our strategy of prudent growth and incremental profitability. Our diluted earnings per share of $0.50 for the six months ended June 30, 2025, doubled from the same period last year driven by incremental net interest income and non-interest income while keeping non-interest expenses almost flat. Our net interest margin this quarter increased by 29 basis points compared to the prior quarter, reflecting both our high-yielding construction loans and our decreasing borrowing costs. Our non-performing loans also decreased this quarter. All-in-all, a very good quarter in these turbulent and uncertain times."

Executive Chairman's Comment

Steven A. Tsavaris, Ponce Financial Group's Executive Chairman, added "We continue to make progress towards our commitments under the U.S. Treasury's Emergency Capital Investment Program. As we previously communicated, given our level of originations from April 2024 to March 2025, we have ensured another year of the lowest possible preferred stock dividend of 0.50%. Regarding next year's dividend period, we're at 69% of the goal to qualify for the 0.50% rate with three more quarters to go. Also, we're mindful of our percentage of deep impact lending, as we need to be at 60% or above for 16 quarters cumulatively, as a condition to buy the preferred stock back. After 12 quarters, including the quarter ended June 30, 2025, we are at 80% deep impact lending."

The table below indicates the Key Metrics at or for the three months ended:

	At or for the Three Months Ended
	June 30,			March 31,			December 31,			September 30,			June 30,
	2025			2025			2024			2024			2024
Performance Ratios:
Return on average assets ⁽¹⁾		0.79	%		0.77	%		0.38	%		0.33	%		0.45	%
Return on common equity ⁽¹⁾		7.88	%		7.97	%		3.76	%		3.06	%		4.60	%
Net interest margin ^{(1) (2)}		3.27	%		2.98	%		2.80	%		2.65	%		2.62	%
Non-interest expense to average assets ⁽¹⁾		2.18	%		2.19	%		2.25	%		2.19	%		2.28	%
Efficiency ratio ⁽³⁾		63.69	%		68.70	%		75.63	%		80.87	%		80.09	%
Capital Ratios:
Total capital to risk-weighted assets (Ponce Financial Group)		22.65	%		22.84	%		22.98	%		22.87	%		23.86	%
Common equity Tier 1 capital to risk-weighted assets (Ponce Financial Group)		12.49	%		12.51	%		12.44	%		12.28	%		12.71	%
Tier 1 capital to total assets (Ponce Financial Group)		17.13	%		16.84	%		17.70	%		17.81	%		17.88	%
Total capital to risk-weighted assets (Bank only)		21.22	%		21.38	%		21.47	%		21.61	%		22.47	%
Common equity Tier 1 capital to risk-weighted assets (Bank only)		20.15	%		20.35	%		20.40	%		20.45	%		21.24	%
Tier 1 capital to total assets (Bank only)		15.99	%		15.61	%		15.81	%		16.19	%		16.70	%
Asset Quality Ratios:
Allowance for credit losses on loans as a percentage of total loans		0.97	%		0.96	%		0.97	%		1.09	%		1.18	%
Allowance for credit losses on loans as a percentage of nonperforming loans		101.01	%		84.15	%		82.29	%		139.52	%		130.28	%
Net (charge-offs) recoveries to average outstanding loans ⁽¹⁾		(0.04	%)		(0.04	%)		(0.45	%)		(0.17	%)		(0.10	%)
Non-performing loans as a percentage of total assets		0.76	%		0.88	%		0.90	%		0.57	%		0.65	%
Other:
Number of offices		17			18			19			19			18
Number of full-time equivalent employees		206			211			218			228			227

(1)   Annualized where appropriate.

(2)   Net interest margin represents net interest income divided by average total interest-earning assets.

(3)   Efficiency ratio represents noninterest expense divided by the sum of net interest income and noninterest income.

Summary of Results of Operations

Net income for the three months ended June 30, 2025, was $6.1 million compared to net income of $6.0 million for the three months ended March 31, 2025, and net income of $3.2 million for the three months ended June 30, 2024.

The $0.1 million increase of net income for the three months ended June 30, 2025, compared to the three months ended March 31, 2025, was attributed mainly to increase of $2.2 million in net interest income and a decrease of $0.1 million in provision for income taxes while remaining flat on non-interest expense, partially offset by an increase of $1.9 million in provision for credit losses and a decrease of $0.3 million in non-interest income.

The $2.9 million increase of net income for the three months ended June 30, 2025, compared to the three months ended June 30, 2024 was largely due to increases of $6.5 million in net interest income, partially offset by increases of $2.5 million in provision for credit losses, $0.7 million in provision for income taxes and $0.2 million in non-interest expense and a decrease of $0.2 million in non-interest income.

Net income for the six months ended June 30, 2025, was $12.1 million compared to net income of $5.6 million for the six months ended June 30, 2024. The $6.5 million increase of net income for the six months ended June 30, 2025, compared to the six months ended June 30, 2024, was attributed mainly to increases of $9.9 million in net interest income and $0.5 million in non-interest income; partially offset by increases of $2.2 million in provision for credit losses, $1.4 million in provision for income taxes and $0.3 million in non-interest expense.

Net Interest Income and Net Interest Margin

Net interest income for the three months ended June 30, 2025, increased $2.2 million, or 10.01%, to $24.4 million compared to $22.2 million for the three months ended March 31, 2025, and increased $6.5 million, or 36.43%, compared to $17.9 million for the three months ended June 30, 2024.

The $2.2 million increase in net interest income from the three months ended March 31, 2025, was attributable to an increase of $1.9 million in total interest and dividend income and a decrease of $0.3 million in total interest expense. The $6.5 million increase in net interest income from the three months ended June 30, 2024, was attributable to an increase of $7.0 million in total interest and dividend income, offset by an increase of $0.5 million in total interest expense.

Net interest income for the six months ended June 30, 2025, increased $9.9 million, or 26.96%, to $46.6 million compared to $36.7 million for the six months ended June 30, 2024. The $9.9 million increase in net interest income was attributable to an increase of $11.4 million in total interest and dividend income, offset by an increase of $1.5 million in total interest expense.

Net interest margin was 3.27% for the three months ended June 30, 2025, compared to 2.98% for the prior quarter, an increase of 29bps and 2.62% for the same period last year, an increase of 65bps.

Net interest margin was 3.12% for the six months ended June 30, 2025 compared to 2.67% for the six months ended June 30, 2024, an increase of 45bps.

Non-interest Income

Non-interest income for the three months ended June 30, 2025, was $2.1 million, a decrease of $0.3 million, or 13.48%, compared to $2.4 million for the three months ended March 31, 2025, and a decrease of $0.2 million, or 8.77%, compared to $2.3 million for the three months ended June 30, 2024.

The $0.3 million decrease in non-interest income from the three months ended March 31, 2025, was largely attributable to decreases of

$0.4 million in income on sale of SBA loans, $0.2 million in late and prepayment charges and $0.2 million in other non-interest income, partially offset by an increase of $0.4 million in grant income.

The $0.2 million decrease in non-interest income from the three months ended June 30, 2024, was largely attributable to decreases of $0.6 million in other non-interest income and $0.1 million in income on the sale of mortgage loans, partially offset by increases of $0.4 million in grant income and $0.1 million in late and prepayment charges.

Non-interest income for the six months ended June 30, 2025, was $4.4 million, an increase of $0.5 million, or 12.01%, compared to $4.0 million for the six months ended June 30, 2024. The $0.5 million increase in non-interest income was largely attributable to increases of $0.4 million in grant income, $0.4 million in income on sale of SBA loans and $0.4 million in late and prepayment charges, partially offset by decreases of $0.6 million in other non-interest income and $0.3 million in income on the sale of mortgage loans.

Non-interest Expense

Non-interest expense for the three months ended June 30, 2025, remained flat at $16.9 million compared to the three months ended March 31, 2025, and increased $0.2 million, or 1.38%, compared to $16.6 million for the three months ended June 30, 2024.

The $0.2 million increase in non-interest expense from the three months ended June 30, 2024, was mainly attributable to increases of $0.3 million in occupancy and equipment, $0.2 million in data processing expenses, $0.1 million in marketing and promotional expenses and $0.1 million in federal deposit insurance and regulatory assessment, partially offset by a decrease of $0.4 million in direct loan expenses.

Non-interest expense for the six months ended June 30, 2025, was $33.8 million, an increase of $0.3 million, or 0.99%, compared to $33.4 million for the six months ended June 30, 2024. The $0.3 million increase in non-interest expense was mainly attributable to increases of $0.6 million in occupancy and equipment, $0.4 million in other operating expense and $0.2 million in data processing expenses, partially offset by decreases of $0.7 million in direct loan expenses and $0.4 million in professional fees.

Credit Quality:

Total non-performing assets and accruing modifications to borrowers experiencing financial difficulty were $28.5 million at June 30, 2025, compared to $32.0 million at March 31, 2025, and $23.2 million at June 30, 2024.

During the three months ended June 30, 2025, a credit loss provision of $1.6 million on loans was recorded, consisting of $1.3 million charged on the funded portion and $0.3 million charged on the unfunded portion on loans. During the three months ended March 31, 2025, a credit loss benefit of $0.3 million on loans was recorded, consisting of $0.7 million charged on the funded portion and a benefit of $1.0 million on the unfunded portion on loans. During the three months ended June 30, 2024, a credit loss benefit of $0.6 million on loans was recorded, consisting of $0.5 million benefit on the unfunded portion on loans and $0.1 million benefit on the funded portion.

During the six months ended June 30, 2025, a credit loss provision of $1.3 million on loans was recorded, consisting of $2.1 million charged on the funded portion and a benefit of $0.8 million on the unfunded portion on loans. During the six months ended June 30, 2024, a credit loss benefit of $0.7 million on loans was recorded, consisting of $0.4 million benefit on the funded portion and a benefit of $0.3 million on unfunded portion on loans.

Balance Sheet Summary

Total assets increased $113.9 million, or 3.75%, to $3.15 billion as of June 30, 2025, from $3.04 billion as of December 31, 2024. The increase in total assets is largely attributable to increases of $172.1 million in net loans receivable, $1.7 million in other assets and $1.4 million in accrued interest receivable, partially offset by decreases of $31.1 million in held-to-maturity securities, $13.2 million in cash and cash equivalents, $8.4 million in available-for-sale securities, $5.0 million in mortgage loans held for sale and $2.6 million in Federal Home Loan Bank of New York stock.

Total liabilities increased $98.3 million, or 3.88%, to $2.63 billion as of June 30, 2025, from $2.53 billion as of December 31, 2024. The increase in total liabilities was largely attributable to an increase of $157.3 million in deposits, $0.6 million in advance payments by borrowers for taxes and insurance and $0.4 million in accrued interest payable, partially offset by decreases of $60.0 million in borrowings and $0.2 million in operating lease liabilities.

Total stockholders' equity increased $15.6 million, or 3.08%, to $521.1 million as of June 30, 2025, from $505.5 million as of December 31, 2024. The $15.6 million increase in stockholders' equity was largely attributable to $12.1 million in net income, $2.3 million in other comprehensive income, $1.0 million impact to additional paid in capital as a result of share-based compensation and $0.9 million from release of ESOP shares, offset by $0.6 million in dividends on preferred shares.

About Ponce Financial Group, Inc.

Ponce Financial Group, Inc. is the holding company for Ponce Bank. Ponce Bank is a Minority Depository Institution, a Community Development Financial Institution, and a certified Small Business Administration lender. Ponce Bank's business primarily consists of taking deposits from the general public and to a lesser extent alternative funding sources and investing those funds, together with funds generated from operations and borrowings, in mortgage loans, consisting of 1-4 family residences (investor-owned and owner-occupied), multifamily residences, nonresidential properties, construction and land, and, to a lesser extent, in business and consumer loans. Ponce Bank also invests in securities, which consist of U.S. Government and federal agency securities and securities issued by government-sponsored or government-owned enterprises, as well as, mortgage-backed securities, corporate bonds and obligations, and Federal Home Loan Bank stock.

Forward-Looking Statements

Certain statements herein constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements may be identified by words such as "believes," "will," "would," "expects," "project," "may," "could," "developments," "strategic," "launching," "opportunities," "anticipates," "estimates," "intends," "plans," "targets" and similar expressions. These statements are based upon the current beliefs and expectations of management and are subject to significant risks and uncertainties. Actual results may differ materially from those set forth in the forward-looking statements as a result of numerous factors. Factors that could cause such differences to exist include, but are not limited to, adverse conditions in the capital and debt markets and the impact of such conditions on business activities; changes in interest rates; competitive pressures from other financial institutions; the effects of general economic conditions on a national basis or in the local markets in which Ponce Bank operates, including changes that adversely affect borrowers' ability to service and repay Ponce Bank's loans; changes in U.S. trade policies, including the imposition of tariffs and retaliatory tariffs, and their related impacts on the economy; changes in the value of securities in the investment portfolio; changes in loan default and charge-off rates; fluctuations in real estate values; the adequacy of loan loss reserves; decreases in deposit levels necessitating increased borrowing to fund loans and investments; operational risks including, but not limited to, cybersecurity, fraud and natural disasters; changes in government regulation; changes in accounting standards and practices; the risk that intangibles recorded in the financial statements will become impaired; demand for loans in Ponce Bank's market area; Ponce Bank's ability to attract and maintain deposits; risks related to the implementation of acquisitions, dispositions, and restructurings; the risk that Ponce Financial Group, Inc. may not be successful in the implementation of its business strategy; changes in assumptions used in making such forward-looking statements and the risk factors described in Ponce Financial Group, Inc.'s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q as filed with the Securities and Exchange Commission (the "SEC"), which are available at the SEC's website, www.sec.gov. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. Ponce Financial Group, Inc. disclaims any obligation to publicly update or revise any forward-looking statements to reflect changes in underlying assumptions or factors, new information, future events or other changes, except as may be required by applicable law or regulation.

Ponce Financial Group, Inc. and Subsidiaries

Consolidated Statements of Financial Condition

(Dollars in thousands, except for share data)

	As of
	June 30,			March 31,			December 31,			September 30,			June 30,
	2025			2025			2024			2024			2024
ASSETS
Cash and due from banks:
Cash	$	35,767		$	32,113		$	35,478		$	32,061		$	23,128
Interest-bearing deposits		90,872			97,780			104,361			123,751			80,038
Total cash and cash equivalents		126,639			129,893			139,839			155,812			103,166
Available-for-sale securities, at fair value		96,562			103,570			104,970			111,005			113,125
Held-to-maturity securities, at amortized cost		336,879			358,024			367,938			403,736			442,113
Placement with banks		249			249			249			249			249
Mortgage loans held for sale, at fair value		5,703			8,567			10,736			9,566			37,764
Loans receivable, net		2,458,712			2,370,931			2,286,599			2,180,331			2,022,173
Accrued interest receivable		19,126			19,008			17,771			16,890			17,441
Premises and equipment, net		16,067			16,417			16,794			16,843			16,976
Right of use assets		28,806			29,496			29,093			29,785			30,349
Federal Home Loan Bank of New York stock (FHLBNY), at cost		26,620			25,807			29,182			28,515			23,972
Deferred tax assets		12,143			11,629			12,074			11,845			13,172
Other assets		26,363			16,245			24,693			51,392			21,507
Total assets	$	3,153,869		$	3,089,836		$	3,039,938		$	3,015,969		$	2,842,007
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Deposits	$	2,042,209		$	2,004,947		$	1,884,864		$	1,870,323		$	1,606,097
Operating lease liabilities		30,501			31,126			30,696			31,343			31,861
Accrued interest payable		4,161			4,628			3,712			2,918			6,820
Advance payments by borrowers for taxes and insurance		10,942			12,901			10,349			13,733			10,838
Borrowings		536,100			521,100			596,100			580,421			680,421
Other liabilities		8,868			1,248			8,717			12,642			8,313
Total liabilities		2,632,781			2,575,950			2,534,438			2,511,380			2,344,350
Commitments and contingencies
Stockholders' Equity:
Preferred stock, $0.01 par value; 100,000,000 shares authorized		225,000			225,000			225,000			225,000			225,000
Common stock, $0.01 par value; 200,000,000 shares authorized		249			249			249			249			249
Treasury stock, at cost		(7,404	)		(7,641	)		(7,707	)		(9,445	)		(9,519	)
Additional paid-in-capital		208,275			207,888			207,319			208,478			207,934
Retained earnings		119,250			113,432			107,754			105,103			102,951
Accumulated other comprehensive loss		(13,047	)		(13,515	)		(15,297	)		(12,686	)		(16,557	)
Unearned compensation ─ ESOP		(11,235	)		(11,527	)		(11,818	)		(12,110	)		(12,401	)
Total stockholders' equity		521,088			513,886			505,500			504,589			497,657
Total liabilities and stockholders' equity	$	3,153,869		$	3,089,836		$	3,039,938		$	3,015,969		$	2,842,007

Ponce Financial Group, Inc. and Subsidiaries

Consolidated Statements of Operations

(Dollars in thousands, except per share data)

	Three Months Ended
	June 30,		March 31,			December 31,			September 30,			June 30,
	2025		2025			2024			2024			2024
Interest and dividend income:
Interest on loans receivable	$	40,291	$	37,136		$	35,622		$	32,945		$	31,281
Interest on deposits due from banks		807		1,668			1,783			2,430			1,542
Interest and dividend on securities and FHLBNY stock		4,762		5,193			5,481			5,918			5,969
Total interest and dividend income		45,860		43,997			42,886			41,293			38,792
Interest expense:
Interest on certificates of deposit		7,382		7,754			8,104			6,926			6,358
Interest on other deposits		9,058		8,554			8,476			8,519			7,389
Interest on borrowings		4,994		5,486			5,576			6,825			7,141
Total interest expense		21,434		21,794			22,156			22,270			20,888
Net interest income		24,426		22,203			20,730			19,023			17,904
Provision (benefit) for credit losses ⁽¹⁾		1,626		(285	)		897			537			(867	)
Net interest income after provision (benefit) for credit losses		22,800		22,488			19,833			18,486			18,771
Non-interest income:
Service charges and fees		511		525			500			508			492
Brokerage commissions		—		4			44			—			9
Late and prepayment charges		530		697			318			77			426
Income on sale of mortgage loans		169		148			254			218			274
Income on sale of SBA loans		—		404			148			—			—
Grant income		428		—			—			—			—
Other		422		603			833			348			1,057
Total non-interest income		2,060		2,381			2,097			1,151			2,258
Non-interest expense:
Compensation and benefits		7,627		7,780			7,668			7,674			7,724
Occupancy and equipment		3,907		3,913			3,863			3,786			3,564
Data processing expenses		1,188		1,152			1,143			1,099			1,013
Direct loan expenses		241		388			617			573			633
Insurance and surety bond premiums		297		315			293			292			263
Office supplies, telephone and postage		174		170			294			222			233
Professional fees		1,367		1,364			1,703			1,351			1,369
Microloans recoveries		—		—			(29	)		(54	)		(65	)
Marketing and promotional expenses		266		83			289			180			145
Federal deposit insurance and regulatory assessment ⁽²⁾		546		461			418			392			428
Other operating expenses ⁽²⁾		1,256		1,262			1,206			1,051			1,333
Total non-interest expense ⁽¹⁾		16,869		16,888			17,465			16,566			16,640
Income before income taxes		7,991		7,981			4,465			3,071			4,389
Provision for income taxes		1,891		2,022			1,532			638			1,197
Net income	$	6,100	$	5,959		$	2,933		$	2,433		$	3,192
Dividends on preferred shares		282		281			282			281			75
Net income available to common stockholders	$	5,818	$	5,678		$	2,651		$	2,152		$	3,117
Earnings per common share:
Basic	$	0.26	$	0.25		$	0.12		$	0.10		$	0.14
Diluted	$	0.25	$	0.25		$	0.12		$	0.10		$	0.14
Weighted average common shares outstanding:
Basic		22,716,615		22,662,916			22,528,160			22,446,009			22,409,803
Diluted		22,947,769		22,876,740			22,807,644			22,612,028			22,419,309

(1) For the three months ended December 31, 2024, September 30, 2024, and June 30, 2024, benefit for contingencies in the amounts of $0.2 million, $0.3 million and $0.5 million were reclassified from total non-interest expense to benefit for credit losses.

(2) For the three months ended September 30, 2024, and June 30, 2024, $0.3 million of federal deposit insurance was reclassified from other operating expenses to federal deposit insurance and regulatory assessments and $0.1 million of directors' fees were reclassified from federal deposit insurance and regulatory assessments to other operating expenses for each of the periods.

Ponce Financial Group, Inc. and Subsidiaries

Consolidated Statements of Operations

(Dollars in thousands, except per share data)

	For the Six Months Ended June 30,
	2025		2024			Variance $			Variance %
Interest and dividend income:
Interest on loans receivable	$	77,427	$	61,945		$	15,482			24.99	%
Interest on deposits due from banks		2,475		4,453			(1,978	)		(44.42	%)
Interest and dividend on securities and FHLBNY stock		9,955		12,060			(2,105	)		(17.45	%)
Total interest and dividend income		89,857		78,458			11,399			14.53	%
Interest expense:
Interest on certificates of deposit		15,136		12,738			2,398			18.83	%
Interest on other deposits		17,612		13,929			3,683			26.44	%
Interest on borrowings		10,480		15,064			(4,584	)		(30.43	%)
Total interest expense		43,228		41,731			1,497			3.59	%
Net interest income		46,629		36,727			9,902			26.96	%
Provision (benefit) for credit losses ⁽¹⁾		1,341		(883	)		2,224			(251.87	%)
Net interest income after provision (benefit) for credit losses		45,288		37,610			7,678			20.41	%
Non-interest income:
Service charges and fees		1,036		965			71			7.36	%
Brokerage commissions		4		17			(13	)		(76.47	%)
Late and prepayment charges		1,227		785			442			56.31	%
Income on sale of mortgage loans		317		576			(259	)		(44.97	%)
Income on sale of SBA loans		404		—			404			—	%
Grant income		428		—			428			—	%
Other		1,025		1,622			(597	)		(36.81	%)
Total non-interest income		4,441		3,965			476			12.01	%
Non-interest expense:
Compensation and benefits		15,407		15,568			(161	)		(1.03	%)
Occupancy and equipment		7,820		7,231			589			8.15	%
Data processing expenses		2,340		2,140			200			9.35	%
Direct loan expenses		629		1,365			(736	)		(53.92	%)
Insurance and surety bond premiums		612		516			96			18.60	%
Office supplies, telephone and postage		344		482			(138	)		(28.63	%)
Professional fees		2,731		3,092			(361	)		(11.68	%)
Microloans recoveries		—		(118	)		118			(100.00	%)
Marketing and promotional expenses		349		245			104			42.45	%
Federal deposit insurance and regulatory assessments ⁽²⁾		1,007		817			190			23.26	%
Other operating expenses ⁽²⁾		2,518		2,088			430			20.59	%
Total non-interest expense ⁽¹⁾		33,757		33,426			331			0.99	%
Income before income taxes		15,972		8,149			7,823			96.00	%
Provision for income taxes		3,913		2,543			1,370			53.87	%
Net income	$	12,059	$	5,606		$	6,453			115.11	%
Dividends on preferred shares		563		75			488			650.67	%
Net income available to common stockholders	$	11,496	$	5,531		$	5,965			107.85	%
Earnings per common share:
Basic	$	0.51	$	0.25		$	0.26			104.00	%
Diluted	$	0.50	$	0.25		$	0.25			100.00	%
Weighted average common shares outstanding:
Basic		22,689,914		22,381,647			308,267			1.38	%
Diluted		22,920,841		22,393,018			527,823			2.36	%

(1) For the six months ended June 30, 2024, benefit for contingencies in the amount of $0.3 million were reclassified from total non-interest expense to benefit for credit losses.

(2) For the six months ended June 30, 2024, $0.6 million of federal deposit insurance was reclassified from other operating expenses to federal deposit insurance and regulatory assessments and $0.2 million of directors' fees were reclassified from federal deposit insurance and regulatory assessments to other operating expenses for each of the periods.

Ponce Financial Group, Inc. and Subsidiaries

Loans Receivable excluding Mortgage Loans Held for Sale

	As of
	June 30,						March 31,						December 31,						September 30,						June 30,
	2025						2025						2024						2024						2024
	Amount			Percent			Amount			Percent			Amount			Percent			Amount			Percent			Amount			Percent
	(Dollars in thousands)
Mortgage loans:
1-4 family residential
Investor Owned	$	317,488			12.78	%	$	325,866			13.62	%	$	330,053			14.30	%	$	332,380			15.09	%	$	337,292			16.49	%
Owner-Occupied		134,862			5.43	%		137,676			5.75	%		142,363			6.17	%		145,065			6.59	%		147,485			7.21	%
Multifamily residential		693,670			27.96	%		675,541			28.24	%		670,159			29.04	%		678,029			30.78	%		545,323			26.66	%
Nonresidential properties		404,512			16.30	%		390,681			16.33	%		389,898			16.89	%		383,277			17.40	%		337,583			16.51	%
Construction and land		883,462			35.59	%		815,425			34.08	%		733,660			31.79	%		631,461			28.67	%		641,879			31.39	%
Total mortgage loans		2,433,994			98.06	%		2,345,189			98.02	%		2,266,133			98.19	%		2,170,212			98.53	%		2,009,562			98.26	%
Non-mortgage loans:
Business loans		47,372			1.91	%		46,329			1.94	%		40,849			1.77	%		28,499			1.29	%		30,222			1.48	%
Consumer loans ⁽¹⁾		840			0.03	%		997			0.04	%		1,038			0.04	%		4,021			0.18	%		5,305			0.26	%
Total non-mortgage loans		48,212			1.94	%		47,326			1.98	%		41,887			1.81	%		32,520			1.47	%		35,527			1.74	%
Total loans, gross		2,482,206			100.00	%		2,392,515			100.00	%		2,308,020			100.00	%		2,202,732			100.00	%		2,045,089			100.00	%
Net deferred loan origination costs		606						1,390						1,081						1,565						1,145
Allowance for credit losses on loans		(24,100	)					(22,974	)					(22,502	)					(23,966	)					(24,061	)
Loans, net	$	2,458,712					$	2,370,931					$	2,286,599					$	2,180,331					$	2,022,173

(1) As of September 30, 2024, and June 30, 2024, consumer loans include $3.0 million, and $4.3 million, respectively, of microloans originated by the Bank. As of December 31, 2024, these microloans were charged-off.

Ponce Financial Group, Inc. and Subsidiaries

Allowance for Credit Losses on Loans

	For the Three Months Ended
	June 30,			March 31,			December 31,			September 30,			June 30,
	2025			2025			2024			2024			2024
	(Dollars in thousands)
Allowance for credit losses on loans at beginning of the period	$	22,974		$	22,502		$	23,966		$	24,061		$	24,664
Provision (benefit) for credit losses on loans		1,348			731			1,090			801			(120	)
Charge-offs:
Mortgage loans:
1-4 family residences
Investor owned		—			(38	)		—			—			—
Owner occupied		—			—			—			—			—
Multifamily residences		—			—			—			—			—
Nonresidential properties		—			—			—			(7	)		—
Construction and land		—			—			—			—			—
Non-mortgage loans:
Business		(222	)		(222	)		(232	)		(450	)		—
Consumer		—			(3	)		(2,465	)		(634	)		(747	)
Total charge-offs		(222	)		(263	)		(2,697	)		(1,091	)		(747	)
Recoveries:
Non-mortgage loans:
Business		—			4			—			1			7
Consumer		—			—			143			194			257
Total recoveries		—			4			143			195			264
Net (charge-offs) recoveries		(222	)		(259	)		(2,554	)		(896	)		(483	)
Allowance for credit losses on loans at end of the period	$	24,100		$	22,974		$	22,502		$	23,966		$	24,061

Ponce Financial Group, Inc. and Subsidiaries

Deposits

	As of
	June 30,					March 31,					December 31,					September 30,					June 30,
	2025					2025					2024					2024					2024
	Amount		Percent			Amount		Percent			Amount		Percent			Amount		Percent			Amount		Percent
	(Dollars in thousands)
Demand	$	197,671		9.68	%	$	212,139		10.58	%	$	169,178		8.98	%	$	182,737		9.78	%	$	178,125		11.09	%
Interest-bearing deposits:
NOW/IOLA accounts		63,626		3.12	%		74,430		3.71	%		62,616		3.32	%		71,445		3.82	%		81,178		5.05	%
Money market accounts		790,939		38.73	%		692,753		34.55	%		636,219		33.75	%		660,168		35.30	%		502,255		31.27	%
Reciprocal deposits		136,693		6.69	%		141,838		7.07	%		130,677		6.93	%		94,145		5.03	%		109,945		6.85	%
Savings accounts		102,759		5.03	%		106,122		5.29	%		105,870		5.62	%		108,941		5.82	%		109,694		6.83	%
Total NOW, money market, reciprocal and savings accounts		1,094,017		53.57	%		1,015,143		50.62	%		935,382		49.62	%		934,699		49.97	%		803,072		50.00	%
Certificates of deposit of $250K or more⁽¹⁾		220,671		10.81	%		219,721		10.96	%		204,293		10.84	%		210,262		11.25	%		189,683		11.82	%
Brokered certificates of deposit ⁽²⁾		69,531		3.40	%		84,531		4.22	%		94,531		5.02	%		94,531		5.05	%		94,614		5.89	%
Listing service deposits ⁽²⁾		6,140		0.30	%		6,140		0.31	%		7,376		0.39	%		7,376		0.39	%		9,361		0.58	%
All other certificates of deposit less than $250K ⁽¹⁾		454,179		22.24	%		467,273		23.31	%		474,104		25.15	%		440,718		23.56	%		331,242		20.62	%
Total certificates of deposit		750,521		36.75	%		777,665		38.80	%		780,304		41.40	%		752,887		40.25	%		624,900		38.91	%
Total interest-bearing deposits		1,844,538		90.32	%		1,792,808		89.42	%		1,715,686		91.02	%		1,687,586		90.22	%		1,427,972		88.91	%
Total deposits	$	2,042,209		100.00	%	$	2,004,947		100.00	%	$	1,884,864		100.00	%	$	1,870,323		100.00	%	$	1,606,097		100.00	%

(1) As of September 30, 2024, and June 30, 2024, $36.2 million, and $33.5 million, respectively, were reclassified from all other certificates of deposit less than $250K to certificates of deposit of $250K or more.

(2) There were no individual listing service deposits amounting to $250,000 or more. There was one brokered certificates of deposit in the amount of $1.5 million amounting to $250,000 or more. All other brokered certificates of deposit individually amounted to less than $250,000.

Ponce Financial Group, Inc. and Subsidiaries

Nonperforming Assets

	As of Three Months Ended
	June 30,			March 31,			December 31,			September 30,			June 30,
	2025			2025			2024			2024			2024
	(Dollars in thousands)
Non-accrual loans:
Mortgage loans:
1-4 family residential
Investor owned	$	1,859		$	1,052		$	436		$	436		$	436
Owner occupied		—			1,423			1,423			1,423			1,423
Multifamily residential		11,703			9,788			10,271			4,685			5,754
Nonresidential properties		405			—			—			824			828
Construction and land		8,907			14,159			14,158			8,907			8,907
Non-mortgage loans:
Business		276			170			343			180			396
Consumer		—			—			—			—			—
Total non-accrual loans (not including non-accruing modifications to borrowers experiencing financial difficulty) ⁽¹⁾	$	23,150		$	26,592		$	26,631		$	16,455		$	17,744

Non-accruing modifications to borrowers experiencing financial difficulty ⁽¹⁾:
Mortgage loans:
1-4 family residential
Investor owned	$	284		$	279		$	279		$	278		$	277
Owner occupied		424			431			435			444			448
Multifamily residential		—			—			—			—			—
Nonresidential properties		—			—			—			—			—
Construction and land		—			—			—			—			—
Non-mortgage loans:
Business		—			—			—			—			—
Consumer		—			—			—			—			—
Total non-accruing modifications to borrowers experiencing financial difficulty ⁽¹⁾		708			710			714			722			725
Total non-performing assets ⁽²⁾	$	23,858		$	27,302		$	27,345		$	17,177		$	18,469

Accruing modifications to borrowers experiencing financial difficulty ⁽¹⁾:
Mortgage loans:
1-4 family residential
Investor owned	$	1,779		$	1,792		$	1,807		$	1,821		$	1,830
Owner occupied		2,012			2,038			2,062			2,116			2,171
Multifamily residential		—			—			—			—			—
Nonresidential properties		655			644			652			672			707
Construction and land		—			—			—			—			—
Non-mortgage loans:
Business		203			209			215			222			—
Consumer		—			—			—			—			—
Total accruing modifications to borrowers experiencing financial difficulty ⁽¹⁾	$	4,649		$	4,683		$	4,736		$	4,831		$	4,708
Total non-performing assets and accruing modifications to borrowers experiencing financial difficulty ⁽¹⁾	$	28,507		$	31,985		$	32,081		$	22,008		$	23,177
Total non-performing assets to total assets		0.76	%		0.88	%		0.90	%		0.57	%		0.65	%

(1) Balances include both modifications to borrowers experiencing financial difficulty, in accordance with ASU 2022-02 adopted on January 1, 2023, and previously existing troubled debt restructurings.

(2) Includes nonperforming mortgage loans held for sale.

Ponce Financial Group, Inc. and Subsidiaries

Average Balance Sheets

	For the Three Months Ended June 30,
	2025						2024
	Average						Average
	Outstanding				Average		Outstanding				Average
	Balance		Interest		Yield/Rate ⁽¹⁾		Balance		Interest		Yield/Rate ⁽¹⁾
	(Dollars in thousands)
Interest-earning assets:
Loans ⁽²⁾	$	2,447,713	$	40,291	6.60	%	$	2,040,149	$	31,281	6.17	%
Securities ⁽³⁾		449,858		4,246	3.79	%		562,560		5,486	3.92	%
Other ⁽⁴⁾		102,252		1,323	5.19	%		141,368		2,025	5.76	%
Total interest-earning assets		2,999,823		45,860	6.13	%		2,744,077		38,792	5.69	%
Non-interest-earning assets		104,059						105,774
Total assets	$	3,103,882					$	2,849,851
Interest-bearing liabilities:
NOW/IOLA	$	68,155	$	100	0.59	%	$	72,932	$	151	0.83	%
Money market		864,688		8,930	4.14	%		599,209		7,209	4.84	%
Savings		104,243		26	0.10	%		111,859		27	0.10	%
Certificates of deposit		772,363		7,382	3.83	%		635,850		6,358	4.02	%
Total deposits		1,809,449		16,438	3.64	%		1,419,850		13,745	3.89	%
Advance payments by borrowers		14,934		2	0.05	%		14,948		2	0.05	%
Borrowings		521,375		4,994	3.84	%		680,421		7,141	4.22	%
Total interest-bearing liabilities		2,345,758		21,434	3.66	%		2,115,219		20,888	3.97	%
Non-interest-bearing liabilities:
Non-interest-bearing demand		203,349		—				188,920		—
Other non-interest-bearing liabilities		36,435		—				49,437		—
Total non-interest-bearing liabilities		239,784		—				238,357		—
Total liabilities		2,585,542		21,434				2,353,576		20,888
Total equity		518,340						496,275
Total liabilities and total equity	$	3,103,882			3.66	%	$	2,849,851			3.97	%
Net interest income			$	24,426					$	17,904
Net interest rate spread ⁽⁵⁾					2.47	%					1.72	%
Net interest-earning assets ⁽⁶⁾	$	654,065					$	628,858
Net interest margin⁽⁷⁾					3.27	%					2.62	%
Average interest-earning assets to interest-bearing liabilities					127.88	%					129.73	%

(1)		Annualized where appropriate.
(2)		Loans include loans and mortgage loans held for sale, at fair value.
(3)		Securities include available-for-sale securities and held-to-maturity securities.
(4)		Includes FHLBNY demand account, FHLBNY stock dividends and FRBNY demand deposits.
(5)		Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average rate of interest-bearing liabilities.
(6)		Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
(7)		Net interest margin represents net interest income divided by average total interest-earning assets.

Ponce Financial Group, Inc. and Subsidiaries

Average Balance Sheets

	Six Months Ended June 30,
	2025							2024
	Average							Average
	Outstanding				Average			Outstanding				Average
	Balance		Interest		Yield/Rate ⁽¹⁾			Balance		Interest		Yield/Rate ⁽¹⁾
	(Dollars in thousands)
Interest-earning assets:
Loans⁽²⁾	$	2,408,788	$	77,427		6.48	%	$	2,009,706	$	61,945		6.20	%
Securities ⁽³⁾		458,660		8,767		3.85	%		569,397		11,105		3.92	%
Other ⁽⁴⁾		143,905		3,663		5.13	%		189,899		5,408		5.73	%
Total interest-earning assets		3,011,353		89,857		6.02	%		2,769,002		78,458		5.70	%
Non-interest-earning assets		106,600							106,172
Total assets	$	3,117,953						$	2,875,174
Interest-bearing liabilities:
NOW/IOLA	$	70,243	$	215		0.62	%	$	77,891	$	369		0.95	%
Money market		846,420		17,341		4.13	%		571,886		13,501		4.75	%
Savings		104,704		52		0.10	%		112,680		55		0.10	%
Certificates of deposit		783,256		15,136		3.90	%		632,689		12,738		4.05	%
Total deposits		1,804,623		32,744		3.66	%		1,395,146		26,663		3.84	%
Advance payments by borrowers		13,696		4		0.06	%		13,917		4		0.06	%
Borrowings		544,857		10,480		3.88	%		725,745		15,064		4.17	%
Total interest-bearing liabilities		2,363,176		43,228		3.69	%		2,134,808		41,731		3.93	%
Non-interest-bearing liabilities:
Non-interest-bearing demand		200,007		—					193,891		—
Other non-interest-bearing liabilities		40,155		—					51,749		—
Total non-interest-bearing liabilities		240,162		—					245,640		—
Total liabilities		2,603,338		43,228					2,380,448		41,731
Total equity		514,615							494,726
Total liabilities and total equity	$	3,117,953				3.69	%	$	2,875,174				3.93	%
Net interest income			$	46,629						$	36,727
Net interest rate spread⁽⁵⁾						2.33	%						1.77	%
Net interest-earning assets ⁽⁶⁾	$	648,177						$	634,194
Net interest margin ⁽⁷⁾						3.12	%						2.67	%
Average interest-earning assets to
interest-bearing liabilities						127.43	%						129.71	%

(1)		Annualized where appropriate.
(2)		Loans include loans and mortgage loans held for sale, at fair value.
(3)		Securities include available-for-sale securities and held-to-maturity securities.
(4)		Includes FHLBNY demand account, FHLBNY stock dividends and FRBNY demand deposits.
(5)		Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average rate of interest-bearing liabilities.
(6)		Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
(7)		Net interest margin represents net interest income divided by average total interest-earning assets.

Ponce Financial Group, Inc. and Subsidiaries

Other Data

	As of
	June 30,		March 31,		December 31,		September 30,		June 30,
	2025		2025		2024		2024		2024
Other Data
Common shares issued		24,886,711		24,886,711		24,886,711		24,886,711		24,886,711
Less treasury shares		901,911		920,520		925,497		1,067,248		1,074,979
Common shares outstanding at end of period		23,984,800		23,966,191		23,961,214		23,819,463		23,811,732

Book value per common share	$	12.34	$	12.05	$	11.71	$	11.74	$	11.45
Tangible book value per common share	$	12.34	$	12.05	$	11.71	$	11.74	$	11.45

Contact:

Sergio J. Vaccaro

sergio.vaccaro@poncebank.net

718-931-9000

Ponce Financial Group, Inc. Reports Second Quarter 2025 Results