SYS-CON MEDIA Authors: Jason Bloomberg, Kevin Benedict, David H Deans, RealWire News Distribution, Gilad Parann-Nissany

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Dime Community Bancshares, Inc. Reports Earnings

2013 EPS of $1.23; Quarterly EPS of $0.29; Credit Quality Remains Solid

BROOKLYN, NY -- (Marketwired) -- 01/27/14 -- Dime Community Bancshares, Inc. (NASDAQ: DCOM) (the "Company" or "Dime"), the parent company of The Dime Savings Bank of Williamsburgh (the "Bank"), today reported financial results for the quarter and fiscal year ended December 31, 2013. Consolidated net income was $43.5 million, or $1.23 per diluted share, for the year ended December 31, 2013, compared to $40.3 million, or $1.17 per diluted share, for the year ended December 31, 2012. Consolidated net income for the quarter ended December 31, 2013 was $10.3 million, or $0.29 per diluted share, compared to $10.6 million, or $0.30 per diluted share, for the quarter ended September 30, 2013, and $6.7 million, or $0.19 per diluted share, for the quarter ended December 31, 2012. Excluding non-recurring items, net income would have been $12.8 million, or $0.37 per diluted share, during the three months ended December 31, 2012, compared to $0.29 for the quarter ended December 31, 2013.

Vincent F. Palagiano, Chairman and Chief Executive Officer of Dime, commented, "The combination of low operating expenses and low credit costs enabled Dime to once again earn double digit returns, even in the face of tighter spreads. Return on average tangible (leverage) equity exceeded 11.9%, and return on average assets was 1.09% for the year."

Management's Discussion of 2013 versus 2012 Results

Net interest income was up $18.6 million, or 16.9% for the year ended December 31, 2013 compared to the year ended December 31, 2012, reflecting a decline of $39.1 million in interest expense that exceeded a $20.5 million decline in interest income. Interest expense was abnormally high in 2012, driven by $28.8 million for the cost of an early extinguishment of high-costing wholesale borrowings. This was a partial balance sheet restructuring transaction of a non-recurring nature.

Reported Net Interest Margin ("NIM") showed a year-over-year gain, rising to 3.39% for 2013, from 2.92% for 2012. However, after adjusting for certain items (prepayment fee income and prepayment penalty on early extinguishment of debt), the "core" NIM declined year-over-year, from 3.28% for 2012 to 3.03% for 2013.

Further comparing 2013 to 2012, non-interest income, excluding gains or losses on trading securities and the disposal of assets, declined by $1.9 million (due primarily to a large reduction in the liability for losses on loans sold to Fannie Mae recognized during 2012); credit loss provisions declined by $3.5 million; and operating expenses remained flat. Loan prepayment fee income (included in interest income) was $13.4 million in 2013, versus $14.6 million in 2012. There was another significant transaction of a non-recurring nature in December 2012: a $13.7 million pre-tax gain on the sale of property.

The net outcome of all of the above was a $3.2 million increase in Net Income, or a $0.06 increase in earnings per diluted share, on a year-over-year basis. Average common diluted shares outstanding were 35.3 million in 2013 versus 34.4 million in 2012, an increase of 2.7%.

Total consolidated assets grew by 3.1% in 2013, fueled by growth in total real estate loans of 5.5%. Loan originations topped $1.0 billion for 2013, but the loan portfolio grew by only $193.7 million, evidence of the prepayment in the portfolio due to sustained low 5 and 10-year Treasury rates. Tangible (leverage) common equity grew by $38.8 million in 2013, or 11.2%, to $384.2 million, primarily through earnings, but supplemented with stock option exercises. As a result, the Tier 1 core leverage ratio (tangible common equity) grew to 9.7% at December 31, 2013 from 9.0% a year earlier.

Management's Discussion of Quarterly Operating Results

  • Net Interest Margin

    Net Interest Margin was 3.24% during the quarter ended December 31, 2013 compared to 3.35% during the September 2013 quarter. The "core" NIM, which excludes the effect of loan prepayment fee income, decreased from 2.98% during the September 2013 quarter to 2.90% during the December 2013 quarter, caused primarily by a reduction of 12 basis points in the average yield on real estate loans (also excluding the effects of loan prepayment fee income).

    A 1 basis point decline in the average cost of deposits helped to reduce the average cost of all interest bearing liabilities, as bank deposit rates (mainly short term) remained low in the Bank's market area.

    Declining loan yields resulted from the cumulative effect of portfolio prepayment and amortization activities during 2013 (in particular, the first six months of the year), as U.S. Treasury yields hovered at historically low levels. During the latter half of 2013, there was a slight uptick in 5 to 10-year Treasuries, which has not quite yet been reflected in the pricing on multifamily and commercial real estate loans. According to Mr. Palagiano, "Competition remained heavy among New York bank competitors for our typical loan product. As long as there are portfolios to be filled, pricing will continue to be favorable to borrowers." For Dime, pricing for prime, low loan-to-value multifamily property loans remains in the 3.5% to 4.0% range.

  • Net Interest Income

    Net interest income was $30.8 million in the quarter ended December 31, 2013, down $886,000 from $31.7 million reported in the September 2013 quarter, and up $22.2 million from $8.6 million reported in the December 2012 quarter. Prepayment fee income on loans totaled $3.2 million during the December 2013 quarter, compared to $3.4 million recognized in the September 2013 quarter and $3.7 million during the December 2012 quarter. During the three months ended December 31, 2012, the Company recognized a $25.6 million pre-tax charge on the borrowing prepayment. Absent the impact of loan prepayment fee income and borrowing prepayment costs, net interest income was $27.6 million during the December 31, 2013 quarter, down $670,000 from the September 30, 2013 quarter and $2.8 million from the December 31, 2012 quarter. The decline in net interest income (excluding loan prepayment fee income) from the September 2013 quarter resulted primarily from a decline of 11 basis points in the average yield earned on the Company's interest earning assets, reflecting the ongoing loan refinancing activity.

  • Provision/Allowance For Loan Losses

    The Company recognized a recapture of $56,000 to the allowance for loan losses and net charge-offs of $331,000 during the December 2013 quarter, resulting in a combined reduction of $387,000 in the allowance for loan losses from September 30, 2013 to December 31, 2013. The $56,000 recapture to the allowance for loan losses recognized during the December 2013 quarter reflected the continued stability of the credit quality of the Bank's loan portfolio.

    As a result, the allowance for loan losses as a percentage of total loans stood at 0.54%, down slightly from 0.56% at the close of the prior quarter.

  • Non-Interest Income

    Non-interest income was $1.8 million for the quarter ended December 31, 2013, a reduction of $171,000 from the previous quarter, due primarily to lower fees collected on portfolio loans.

  • Non-Interest Expense

    Non-interest expense was $15.5 million in the quarter ended December 31, 2013, in line with both the previous quarter and the forecasted level of $15.5 million.

    Non-interest expense was 1.55% of average assets during the most recent quarter. The efficiency ratio approximated 47.5% during the same period.

  • Income Tax Expense

    The effective tax rate approximated 40.1% during the most recent quarter, generally in line with the 40.0% forecasted level.

Management's Discussion of the 4th Quarter 2013 Balance Sheet

Total assets were $4.03 billion at December 31, 2013, up $12.8 million from September 30, 2013.

The total real estate loan portfolio grew by approximately $30.4 million, funded in part from cash on hand. $213.5 million of real estate loans closed during the quarter, compared to $289.6 million in the 3rd quarter of 2013. For comparative and trending purposes, loan originations in the 1st and 2nd quarters of 2013 were $325.0 million and $242.8 million, respectively.

Deposits declined by $102.0 million during the most recent quarter, comprised mainly of repricing promotional single service households for which the Bank declined to compete. Federal Home Loan Bank of New York ("FHLBNY") advances increased by $137.5 million during the same quarter.

  • Real Estate Loans

    Real estate loan originations were $213.5 million during the December 2013 quarter, at a weighted average interest rate of 3.80%. Of this amount, $61.3 million represented loan refinances from the existing portfolio.

    Also during the quarter, loan amortization and satisfactions, including the $61.3 million of refinances of existing loans, totaled $193.5 million, or 21.0% (annualized) of the quarterly average portfolio balance, at an average rate of 5.35%. Total loan commitments stood at $139.8 million at December 31, 2013, with a weighted average rate of 3.77%. The average yield on the loan portfolio (excluding prepayment fee income) during the quarter ended December 31, 2013 was 4.16%, compared to 4.28% during the September 2013 quarter and 4.85% during the December 2012 quarter.

  • Credit Summary

    Non-performing loans were $12.5 million, or 0.34% of total loans, at December 31, 2013, up from $8.8 million, or 0.24% of total loans, at September 30, 2013. This increase resulted primarily from the addition of one $4.4 million loan to non-accrual status. Accruing loans delinquent between 30 and 89 days decreased to $1.6 million, or approximately 0.04% of total loans, at December 31, 2013, compared to $3.8 million, or 0.10% of total loans, at September 30, 2013.

    At December 31, 2013, non-performing assets represented 3.7% of the sum of tangible capital plus the allowance for loan losses (this statistic is otherwise known as the "Texas Ratio") (see table below). This number compares very favorably to both industry and regional averages.

    The remaining pool of loans serviced for Fannie Mae totaled $208.4 million as of December 31, 2013, down from $216.1 million at September 30, 2013. Within the pool of serviced loans previously sold to Fannie Mae with recourse exposure, total loans delinquent 30 days or more approximated $400,000 at both December 31, 2013 and September 30, 2013. Due to both ongoing amortization and the near absence of problem loans within the Fannie Mae portfolio, the Company determined that its liability for the first loss position could be reduced by $60,000, which was recognized during the quarter ended December 31, 2013.

  • Deposits and Borrowed Funds

    Retail deposits decreased $102.0 million from September 30, 2013 to December 31, 2013, reflecting net outflows of $79.1 million in money market deposits and $24.2 million in certificates of deposit ("CDs") during the period. The Bank did not implement any significant promotional deposit activities during the December 2013 quarter, and enacted slight reductions in rates that resulted in a reduction of 1 basis point in the average cost of deposits during the December 2013 quarter. The Bank also closed its Sunnyside branch during the December 2013 quarter, relocating the deposits to its nearby Long Island City branch location. At December 31, 2013, bank-wide average deposit balances approximated $100.3 million per branch.

    The Bank transacted $226.0 million of new fixed-rate FHLBNY borrowings during the quarter ended December 31, 2013, of which $88.5 million were utilized to replace borrowings that matured during the period. Of the $226.0 million of new borrowings, $126.0 million had a weighted average maturity of 3.7 years and a weighted average cost of 1.15%, providing an offset to the fixed rate loan portfolio, and an element of NIM protection should funding rates rise during the term. The remaining balance of new advances, approximately $100 million, were short-term in nature, and had a weighted average maturity of 1 month and a weighted average cost of 0.39%. Management expects to replace the short-term borrowings with both permanent longer-term advances and deposits in the upcoming quarter. The Bank intends to continue the use of longer-term FHLBNY advances to supplement deposit funding when deemed appropriate.

  • Capital

    The Company's consolidated Tier 1 core leverage ratio (tangible common equity) grew during the most recent quarter as a result of both increased retained earnings and stock option exercise activity. Consolidated tangible capital was 9.67% of tangible assets at December 31, 2013, an increase of 16 basis points from September 30, 2013.

    The Bank's tangible (leverage) capital ratio was 9.52% at December 31, 2013, down from 10.24% at September 30, 2013, due to both asset growth and aggregate dividends of $37.3 million paid to the Company during the December 2013 quarter. The Bank's Total Risk-Based Capital Ratio was 13.36% at December 31, 2013, compared to 14.07% at September 30, 2013.

    Reported diluted EPS exceeded the quarterly cash dividend rate per share by 107% during the December 2013 quarter, equating to a 48% payout ratio. Additions to capital from earnings and stock option exercises during the most recent quarterly period caused tangible book value per share to increase $0.17 sequentially during the most recent quarter, to $10.47 at December 31, 2013.

OUTLOOK FOR THE YEAR 2014 AND THE QUARTER ENDING MARCH 31, 2014

At December 31, 2013, Dime had outstanding loan commitments totaling $139.8 million, all of which are likely to close during the quarter ending March 31, 2014, at an average interest rate approximating 3.77%.

For the year ending December 31, 2014, balance sheet growth is targeted to approximate 8.0 - 10.0%, subject to change to reflect market conditions. Loan prepayments and amortization are currently projected to run in the 15% - 20% range throughout the year.

On the liability side, deposit funding costs are expected to remain near current historically low levels through the first quarter of 2014. The Bank has $115.8 million of CDs maturing at an average cost of 0.86% during the quarter ending March 31, 2014. Offering rates on 12-month term CDs currently approximate 50 basis points. The Company has $100 million in short-term borrowings due to mature during the quarter ending March 31, 2014. In the coming quarter, management expects to utilize a combination of FHLBNY advances and retail deposits to fund growth. Advances are anticipated to be of longer duration (3 to 5 year fixed terms) to provide a closer duration match to new loans and a hedge against future higher interest rates.

The Bank anticipates launching promotional deposit campaigns throughout the first quarter of 2014, the success of which will determine the direction and degree of change in the cost of deposits, with a slight upward bias in the March 2014 quarter, and fully reflected in the June 2014 quarter.

Loan loss provisioning will likely continue to be a function of loan portfolio growth, incurred and anticipated losses, and the overall credit quality of the loan portfolio.

Absent any unforeseen items, non-interest expense is expected to approximate $15.5 million during the March 2014 quarter. The Company projects that the consolidated effective tax rate will approximate 41.0% in the March 2014 quarter.

ABOUT DIME COMMUNITY BANCSHARES, INC.

The Company (NASDAQ: DCOM) had $4.03 billion in consolidated assets as of December 31, 2013, and is the parent company of the Bank. The Bank was founded in 1864, is headquartered in Brooklyn, New York, and currently has twenty-five branches located throughout Brooklyn, Queens, the Bronx and Nassau County, New York. More information on the Company and Dime can be found on the Dime's Internet website at www.dime.com.

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

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



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

                                  December 31,  September 30,  December 31,
                                      2013           2013          2012
                                  ------------  -------------  ------------
ASSETS:
Cash and due from banks           $     45,777  $      65,713  $     79,076
Investment securities held to
 maturity                                5,341          5,622         5,927
Investment securities available
 for sale                               18,649         18,468        32,950
Trading securities                       6,822          5,262         4,874
Mortgage-backed securities
 available for sale                     31,543         34,226        49,021
Real Estate Loans:
  One-to-four family and
   cooperative apartment                73,956         78,504        91,876
  Multifamily and loans
   underlying cooperatives (1)       2,917,380      2,859,729     2,670,973
  Commercial real estate (1)           700,606        723,312       735,224
  Construction and land
   acquisition                             268            299           476
  Unearned discounts and net
   deferred loan fees                    5,170          5,095         4,836
                                  ------------  -------------  ------------
  Total real estate loans            3,697,380      3,666,939     3,503,385
                                  ------------  -------------  ------------
  Other loans                            2,139          2,109         2,423
  Allowance for loan losses            (20,153)       (20,540)      (20,550)
                                  ------------  -------------  ------------
Total loans, net                     3,679,366      3,648,508     3,485,258
                                  ------------  -------------  ------------
Loans held for sale                          -              -           560
Premises and fixed assets, net          29,701         29,850        30,518
Federal Home Loan Bank of New
 York capital stock                     48,051         41,863        45,011
Goodwill                                55,638         55,638        55,638
Other Real Estate Owned                     18              -             -
Other assets                           107,185        110,175       116,566
                                  ------------  -------------  ------------
TOTAL ASSETS                      $  4,028,091  $   4,015,325  $  3,905,399
                                  ============  =============  ============
LIABILITIES AND STOCKHOLDERS'
 EQUITY:
Deposits:
Non-interest bearing checking     $    174,457  $     170,250  $    159,144
Interest Bearing Checking               87,301         87,995        95,159
Savings                                376,900        379,113       371,792
Money Market                         1,040,079      1,119,212       961,359
                                  ------------  -------------  ------------
  Sub-total                          1,678,737      1,756,570     1,587,454
                                  ------------  -------------  ------------
Certificates of deposit                828,409        852,594       891,975
                                  ------------  -------------  ------------
Total Due to Depositors              2,507,146      2,609,164     2,479,429
                                  ------------  -------------  ------------
Escrow and other deposits               69,404         98,160        82,753
Federal Home Loan Bank of New
 York advances                         910,000        772,500       842,500
Trust Preferred Notes Payable           70,680         70,680        70,680
Other liabilities                       35,698         42,076        38,463
                                  ------------  -------------  ------------
TOTAL LIABILITIES                    3,592,928      3,592,580     3,513,825
                                  ------------  -------------  ------------
STOCKHOLDERS' EQUITY:
Common stock ($0.01 par,
 125,000,000 shares authorized,
 52,854,483 shares, 52,692,461
 shares and 52,021,149 shares
 issued at December 31, 2013,
 September 30, 2013 and December
 31, 2012, respectively, and
 36,712,951 shares, 36,548,503
 shares, and 35,714,269 shares
 outstanding at December 31,
 2013, September 30, 2013 and
 December 31, 2012, respectively)          528            526           520
Additional paid-in capital             251,910        250,105       239,041
Retained earnings                      402,986        397,664       379,166
Unallocated common stock of
 Employee Stock Ownership Plan          (2,776)        (2,834)       (3,007)
Unearned Restricted Stock Award
 common stock                           (3,193)        (3,693)       (3,122)
Common stock held by the Benefit
 Maintenance Plan                       (9,013)        (9,013)       (8,800)
Treasury stock (16,141,532
 shares, 16,143,958 shares and
 16,306,880 shares at December
 31, 2013, September 30, 2013 and
 December 31, 2012, respectively)     (200,520)      (200,550)     (202,584)
Accumulated other comprehensive
 loss, net of deferred taxes            (4,759)        (9,460)       (9,640)
                                  ------------  -------------  ------------
TOTAL STOCKHOLDERS' EQUITY             435,163        422,745       391,574
                                  ------------  -------------  ------------
TOTAL LIABILITIES AND
 STOCKHOLDERS' EQUITY             $  4,028,091  $   4,015,325  $  3,905,399
                                  ============  =============  ============

(1) While the loans within both of these categories are often considered
 "commercial real estate" in nature, multifamily and loans underlying
 cooperatives are here reported separately from commercial real estate
 loans in order to emphasize the residential nature of the collateral
 underlying a significant component of the total loan portfolio.



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

                                          For the Three Months Ended
                                  -----------------------------------------
                                  December 31,  September 30,  December 31,
                                      2013           2013          2012
                                  ------------  -------------  ------------
Interest income:
    Loans secured by real estate  $     41,303  $      42,451  $     45,414
    Other loans                             26             25            28
    Mortgage-backed securities             290            310           569
    Investment securities                  188             84           220
    Federal funds sold and other
     short-term investments                422            416           518
                                  ------------  -------------  ------------
      Total interest income             42,229         43,286        46,749
                                  ------------  -------------  ------------
Interest expense:
    Deposits and escrow                  4,687          4,908         5,330
    Borrowed funds                       6,775          6,725        32,868
                                  ------------  -------------  ------------
      Total interest expense            11,462         11,633        38,198
                                  ------------  -------------  ------------
        Net interest income             30,767         31,653         8,551
Provision for loan losses                  (56)           240            63
                                  ------------  -------------  ------------
Net interest income after
 provision for loan losses              30,823         31,413         8,488
                                  ------------  -------------  ------------

Non-interest income:
    Service charges and other
     fees                                  905          1,015           605
    Mortgage banking income, net           123             76           293
    Other than temporary
     impairment ("OTTI") charge
     on securities (1)                       -              -             -
    Gain (loss) on sale of
     securities and other assets             -            (21)       14,704
    Gain (loss) on trading
     securities                             78            104           (23)
    Other                                  731            834           919
                                  ------------  -------------  ------------
      Total non-interest income          1,837          2,008        16,498
                                  ------------  -------------  ------------
Non-interest expense:
    Compensation and benefits            9,578          9,466         9,012
    Occupancy and equipment              2,716          2,697         2,621
    Federal deposit insurance
     premiums                              480            515           500
    Other                                2,687          2,897         2,584
                                  ------------  -------------  ------------
      Total non-interest expense        15,461         15,575        14,717
                                  ------------  -------------  ------------

      Income before taxes               17,199         17,846        10,269
Income tax expense                       6,891          7,215         3,534
                                  ------------  -------------  ------------

Net Income                        $     10,308  $      10,631  $      6,735
                                  ============  =============  ============

Earnings per Share ("EPS"):
  Basic                           $       0.29  $        0.30  $       0.19
                                  ============  =============  ============
  Diluted                         $       0.29  $        0.30  $       0.19
                                  ============  =============  ============

Average common shares outstanding
 for Diluted EPS                    35,717,449     35,527,503    34,594,167

(1) Total OTTI charges on securities are summarized as follows for the
 periods presented:
Credit component (shown above)    $          -  $           -  $          -
Non-credit component not included
 in earnings                                 -              -             -
                                  ------------  -------------  ------------
Total OTTI charges                $          -  $           -  $          -
                                  ------------  -------------  ------------



                                       For the Year Ended
                                  ---------------------------
                                  December 31,   December 31,
                                      2013           2012
                                  ------------  -------------
Interest income:
    Loans secured by real estate  $    171,594  $     189,149
    Other loans                            101            104
    Mortgage-backed securities           1,413          3,025
    Investment securities                  503          1,263
    Federal funds sold and other
     short-term investments              1,845          2,413
                                  ------------  -------------
      Total interest income            175,456        195,954
                                  ------------  -------------
Interest expense:
    Deposits and escrow                 19,927         21,779
    Borrowed funds                      27,042         64,333
                                  ------------  -------------
      Total interest expense            46,969         86,112
                                  ------------  -------------
        Net interest income            128,487        109,842
Provision for loan losses                  369          3,921
                                  ------------  -------------
Net interest income after
 provision for loan losses             128,118        105,921
                                  ------------  -------------

Non-interest income:
    Service charges and other
     fees                                3,459          3,445
    Mortgage banking income, net           473          1,768
    Other than temporary
     impairment ("OTTI") charge
     on securities (1)                       -           (181)
    Gain (loss) on sale of
     securities and other assets            89         14,748
    Gain (loss) on trading
     securities                            265            113
    Other                                3,177          3,956
                                  ------------  -------------
      Total non-interest income          7,463         23,849
                                  ------------  -------------
Non-interest expense:
    Compensation and benefits           38,293         37,647
    Occupancy and equipment             10,451         10,052
    Federal deposit insurance
     premiums                            1,951          2,057
    Other                               11,997         12,816
                                  ------------  -------------
      Total non-interest expense        62,692         62,572
                                  ------------  -------------

      Income before taxes               72,889         67,198
Income tax expense                      29,341         26,890
                                  ------------  -------------

Net Income                        $     43,548  $      40,308
                                  ============  =============

Earnings per Share ("EPS"):
  Basic                           $       1.23  $        1.18
                                  ============  =============
  Diluted                         $       1.23  $        1.17
                                  ============  =============

Average common shares outstanding
 for Diluted EPS                    35,306,272     34,364,453

(1) Total OTTI charges on securities are summarized as follows for the
 periods presented:
Credit component (shown above)    $          -  $         181
Non-credit component not included
 in earnings                                 -              6
                                  ------------  -------------
Total OTTI charges                $          -  $         187
                                  ------------  -------------



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

                                          For the Three Months Ended
                                  -----------------------------------------
                                  December 31,  September 30,  December 31,
                                      2013           2013          2012
                                  ------------  -------------  ------------

Reconciliation of Reported and
 Adjusted Earnings (1):
Net Income                        $     10,308  $      10,631  $      6,735
Add: After-tax expense associated
 with the prepayment of
 borrowings                                  -              -        14,032
Add: After-tax charge for OTTI on
 securities                                  -              -             -
Less: After tax gain on sale of
 real estate                                 -              -        (7,529)
Less: After tax gain on sale of
 equity mutual funds                         -              -          (487)
                                  ------------  -------------  ------------
Adjusted net income               $     10,308  $      10,631  $     12,751
                                  ============  =============  ============

Performance Ratios (Based upon
 Reported Earnings):
Reported EPS (Diluted)            $       0.29  $        0.30  $       0.19
Return on Average Assets                  1.03%          1.07%         0.69%
Return on Average Stockholders'
 Equity                                   9.62%         10.19%         7.06%
Return on Average Tangible
 Stockholders' Equity                    10.84%         11.49%         7.97%
Net Interest Spread                       3.04%          3.17%         0.29%
Net Interest Margin                       3.24%          3.35%         0.93%
Non-interest Expense to Average
 Assets                                   1.55%          1.56%         1.51%
Efficiency Ratio                         47.53%         46.38%       141.95%
Effective Tax Rate                       40.07%         40.43%        34.41%

Performance Ratios (Based upon "Adjusted Net
 Income" as calculated above):
EPS (Diluted)                     $       0.29  $        0.30  $       0.37
Return on Average Assets                  1.03%          1.07%         1.31%
Return on Average Stockholders'
 Equity                                   9.62%         10.19%        13.37%
Return on Average Tangible
 Stockholders' Equity                    10.84%         11.49%        15.09%
Net Interest Spread                       3.04%          3.17%         3.09%
Net Interest Margin                       3.24%          3.35%         3.30%
Non-interest Expense to Average
 Assets                                   1.55%          1.56%         1.51%
Efficiency Ratio                         47.53%         46.38%        40.94%
Effective Tax Rate                       40.07%         40.43%        39.96%

Book Value and Tangible Book
 Value Per Share:
Stated Book Value Per Share       $      11.85  $       11.57  $      10.96
Tangible Book Value Per Share            10.47          10.30          9.67

Average Balance Data:
Average Assets                    $  3,997,842  $   3,980,840  $  3,890,420
Average Interest Earning Assets      3,803,406      3,782,043     3,686,130
Average Stockholders' Equity           428,396        417,459       381,368
Average Tangible Stockholders'
 Equity                                380,417        369,982       337,961
Average Loans                        3,667,231      3,646,845     3,443,136
Average Deposits                     2,547,115      2,623,840     2,459,385

Asset Quality Summary:
Net charge-offs                   $        331  $         202  $        207
Non-performing Loans (excluding
 loans held for sale)                   12,549          8,838         8,888
Non-performing Loans/ Total Loans         0.34%          0.24%         0.25%
Nonperforming Assets (2)          $     13,465  $       9,735  $     10,340
Nonperforming Assets/Total Assets         0.33%          0.24%         0.26%
Allowance for Loan Loss/Total
 Loans                                    0.54%          0.56%         0.59%
Allowance for Loan Loss/Non-
 performing Loans                       160.59%        232.41%       231.21%
Loans Delinquent 30 to 89 Days at
 period end                       $      1,603  $       3,763  $      7,171

Consolidated Tangible
 Stockholders' Equity to Tangible
 Assets at period end                     9.67%          9.51%         8.97%

Regulatory Capital Ratios (Bank
 Only):
Tier One Core Leverage Ratio
 (Tangible Common Equity)                 9.52%         10.24%         9.98%
Tier One Risk Based Capital Ratio        12.64%         13.35%        12.95%
Total Risk Based Capital Ratio           13.36%         14.07%        13.67%


                                       For the Year Ended
                                  ---------------------------
                                  December 31,   December 31,
                                      2013           2012
                                  ------------  -------------

Reconciliation of Reported and
 Adjusted Earnings (1):
Net Income                        $     43,548  $      40,308
Add: After-tax expense associated
 with the prepayment of
 borrowings                                  -         14,032
Add: After-tax charge for OTTI on
 securities                                  -             99
Less: After tax gain on sale of
 real estate properties                      -         (7,529)
Less: After tax gain on sale of
 equity mutual funds                         -           (511)
                                  ------------  -------------
Adjusted net income               $     43,548  $      46,399
                                  ============  =============

Performance Ratios (Based upon
 Reported Earnings):
Reported EPS (Diluted)            $       1.23  $        1.17
Return on Average Assets                  1.09%          1.02%
Return on Average Stockholders'
 Equity                                  10.58%         10.73%
Return on Average Tangible
 Stockholders' Equity                    11.93%         12.24%
Net Interest Spread                       3.19%          2.58%
Net Interest Margin                       3.39%          2.92%
Non-interest Expense to Average
 Assets                                   1.57%          1.59%
Efficiency Ratio                         46.23%         52.58%
Effective Tax Rate                       40.25%         40.02%

Performance Ratios (Based upon "Adjusted Net
 Income" as calculated above):
EPS (Diluted)                     $       1.23  $        1.35
Return on Average Assets                  1.09%          1.18%
Return on Average Stockholders'
 Equity                                  10.58%         12.36%
Return on Average Tangible
 Stockholders' Equity                    11.93%         14.09%
Net Interest Spread                       3.19%          3.06%
Net Interest Margin                       3.39%          3.28%
Non-interest Expense to Average
 Assets                                   1.57%          1.59%
Efficiency Ratio                         46.23%         42.34%
Effective Tax Rate                       40.25%         40.74%

Book Value and Tangible Book
 Value Per Share:
Stated Book Value Per Share       $      11.85  $       10.96
Tangible Book Value Per Share            10.47           9.67

Average Balance Data:
Average Assets                    $  3,983,310  $   3,947,043
Average Interest Earning Assets      3,787,188      3,762,007
Average Stockholders' Equity           411,763        375,511
Average Tangible Stockholders'
 Equity                                365,101        329,282
Average Loans                        3,606,039      3,402,838
Average Deposits                     2,589,485      2,397,586

Asset Quality Summary:
Net charge-offs (recoveries)      $        766  $       3,707
Non-performing Loans (excluding
 loans held for sale)                   12,549          8,888
Non-performing Loans/ Total Loans         0.34%          0.25%
Nonperforming Assets (2)          $     13,465  $      10,340
Nonperforming Assets/Total Assets         0.33%          0.26%
Allowance for Loan Loss/Total
 Loans                                    0.54%          0.59%
Allowance for Loan Loss/Non-
 performing Loans                       160.59%        231.21%
Loans Delinquent 30 to 89 Days at
 period end                       $      1,603  $       7,171

Consolidated Tangible
 Stockholders' Equity to Tangible
 Assets at period end                     9.67%          8.97%

Regulatory Capital Ratios (Bank
 Only):
Tier One Core Leverage Ratio
 (Tangible Common Equity)                 9.52%          9.98%
Tier One Risk Based Capital Ratio        12.64%         12.95%
Total Risk Based Capital Ratio           13.36%         13.67%

(1) Adjusted earnings is a "non-GAAP" measure. A reconciliation from the
comparable GAAP measure is provided herein.
(2) Amount comprised of total non-accrual loans (including loans held for
sale) and the recorded balance of pooled bank trust preferred security
investments for which the Bank had not received any contractual payments of
interest or principal in over 90 days.



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

                                            For the Three Months Ended
                                      -------------------------------------
                                                December 31, 2013
                                      -------------------------------------
                                                                  Average
                                         Average                   Yield/
                                         Balance     Interest       Cost
                                      ------------ -----------  -----------
Assets:
  Interest-earning assets:
    Real estate loans                 $  3,665,008 $    41,303         4.51%
    Other loans                              2,223          26         4.68
    Mortgage-backed securities              31,631         290         3.67
    Investment securities                   29,048         188         2.59
    Other short-term investments            75,496         422         2.24
                                      ------------ -----------  -----------
      Total interest earning assets      3,803,406 $    42,229         4.44%
                                      ------------ -----------
  Non-interest earning assets              194,436
                                      ------------
Total assets                          $  3,997,842
                                      ============

Liabilities and Stockholders' Equity:
  Interest-bearing liabilities:
    Interest Bearing Checking
     accounts                         $     89,293 $        47         0.21%
    Money Market accounts                1,063,748       1,343         0.50
    Savings accounts                       376,965          47         0.05
    Certificates of deposit                842,099       3,250         1.53
                                      ------------ -----------  -----------
        Total interest bearing
         deposits                        2,372,105       4,687         0.78
  Borrowed Funds                           867,438       6,775         3.10
                                      ------------ -----------  -----------
      Total interest-bearing
       liabilities                       3,239,543 $    11,462         1.40%
                                      ------------ -----------
  Non-interest bearing checking
   accounts                                175,010
  Other non-interest-bearing
   liabilities                             154,893
                                      ------------
      Total liabilities                  3,569,446
  Stockholders' equity                     428,396
                                      ------------
Total liabilities and stockholders'
 equity                               $  3,997,842
                                      ============
Net interest income                                $    30,767
                                                   ===========
Net interest spread                                                    3.04%
                                                                ===========
Net interest-earning assets           $    563,863
                                      ============
Net interest margin                                                    3.24%
                                                                ===========
Ratio of interest-earning assets to
 interest-bearing liabilities                           117.41%
                                                   ===========

Deposits (including non-interest
 bearing checking accounts)
                                      $  2,547,115 $     4,687         0.73%

SUPPLEMENTAL INFORMATION
Loan prepayment and late payment fee
 income                                            $     3,216
                                      ------------ -----------  -----------
Borrowing prepayment costs                                   -
                                      ------------ -----------  -----------
Real estate loans (excluding
 prepayment and late payment fees)                                     4.16%
                                      ------------ -----------  -----------
Interest earning assets (excluding
 prepayment and late payment fees)                                     4.10%
                                      ------------ -----------  -----------
Borrowings (excluding prepayment
 costs)                               $    867,438 $     6,775         3.10%
                                      ------------ -----------  -----------
Interest bearing liabilities
 (excluding borrowing prepayment
 costs)                                                                1.40%
                                      ------------ -----------  -----------
Net Interest income (excluding loan
 prepayment and late payment fees and
 borrowing prepayment costs)                       $    27,551
                                      ------------ -----------  -----------
Net Interest margin (excluding loan
 prepayment and late payment fees and
 borrowing prepayment costs)                                           2.90%
                                      ------------ -----------  -----------


                                            For the Three Months Ended
                                      -------------------------------------
                                                September 30, 2013
                                      -------------------------------------
                                                                  Average
                                         Average                   Yield/
                                         Balance     Interest       Cost
                                      ------------ -----------  -----------
Assets:
  Interest-earning assets:
    Real estate loans                 $  3,644,557 $    42,451         4.66%
    Other loans                              2,288          25         4.37
    Mortgage-backed securities              35,219         310         3.52
    Investment securities                   29,122          84         1.15
    Other short-term investments            70,857         416         2.35
                                      ------------ -----------  -----------
      Total interest earning assets      3,782,043 $    43,286         4.58%
                                      ------------ -----------
  Non-interest earning assets              198,797
                                      ------------
Total assets                          $  3,980,840
                                      ============

Liabilities and Stockholders' Equity:
  Interest-bearing liabilities:
    Interest Bearing Checking
     accounts                         $     88,471 $        49         0.22%
    Money Market accounts                1,122,644       1,413         0.50
    Savings accounts                       380,088          48         0.05
    Certificates of deposit                862,792       3,398         1.56
                                      ------------ -----------  -----------
        Total interest bearing
         deposits                        2,453,995       4,908         0.79
  Borrowed Funds                           810,191       6,725         3.29
                                      ------------ -----------  -----------
      Total interest-bearing
       liabilities                       3,264,186 $    11,633         1.41%
                                      ------------ -----------
  Non-interest bearing checking
   accounts                                169,845
  Other non-interest-bearing
   liabilities                             129,350
                                      ------------
      Total liabilities                  3,563,381
  Stockholders' equity                     417,459
                                      ------------
Total liabilities and stockholders'
 equity                               $  3,980,840
                                      ============
Net interest income                                $    31,653
                                                   ===========
Net interest spread                                                    3.17%
                                                                ===========
Net interest-earning assets           $    517,857
                                      ============
Net interest margin                                                    3.35%
                                                                ===========
Ratio of interest-earning assets to
 interest-bearing liabilities                           115.86%
                                                   ===========

Deposits (including non-interest
 bearing checking accounts)           $  2,623,840 $     4,908         0.74%

SUPPLEMENTAL INFORMATION
Loan prepayment and late payment fee
 income                                            $     3,467
                                      ------------ -----------  -----------
Borrowing prepayment costs                                   -
                                      ------------ -----------  -----------
Real estate loans (excluding
 prepayment and late payment fees)                                     4.28%
                                      ------------ -----------  -----------
Interest earning assets (excluding
 prepayment and late payment fees)                                     4.21%
                                      ------------ -----------  -----------
Borrowings (excluding prepayment
 costs)                               $    810,191 $     6,725         3.29%
                                      ------------ -----------  -----------
Interest bearing liabilities
 (excluding borrowing prepayment
 costs)                                                                1.41%
                                      ------------ -----------  -----------
Net Interest income (excluding loan
 prepayment and late payment fees and
 borrowing prepayment costs)                       $    28,186
                                      ------------ -----------  -----------
Net Interest margin (excluding loan
 prepayment and late payment fees and
 borrowing prepayment costs)                                           2.98%
                                      ------------ -----------  -----------


                                            For the Three Months Ended
                                      -------------------------------------
                                                December 31, 2012
                                      -------------------------------------
                                                                  Average
                                         Average                   Yield/
                                         Balance     Interest       Cost
                                      ------------ -----------  -----------
Assets:
  Interest-earning assets:
    Real estate loans                 $  3,440,784 $    45,414         5.28%
    Other loans                              2,352          28         4.76
    Mortgage-backed securities              60,129         569         3.79
    Investment securities                   48,089         220         1.83
    Other short-term investments           134,776         518         1.54
                                      ------------ -----------  -----------
      Total interest earning assets      3,686,130 $    46,749         5.07%
                                      ------------ -----------
  Non-interest earning assets              204,290
                                      ------------
Total assets                          $  3,890,420
                                      ============

Liabilities and Stockholders' Equity:
  Interest-bearing liabilities:
    Interest Bearing Checking
     accounts                         $     94,870 $        96         0.40%
    Money Market accounts                  929,856       1,296         0.55
    Savings accounts                       369,796         138         0.15
    Certificates of deposit                910,335       3,800         1.66
                                      ------------ -----------  -----------
        Total interest bearing
         deposits                        2,304,857       5,330         0.92
    Borrowed Funds                         876,604      32,868        14.92
                                      ------------ -----------  -----------
      Total interest-bearing
       liabilities                       3,181,461 $    38,198         4.78%
                                      ------------ -----------
    Non-interest bearing checking
     accounts                              154,528
    Other non-interest-bearing
     liabilities                           173,063
                                      ------------
      Total liabilities                  3,509,052
  Stockholders' equity                     381,368
                                      ------------
Total liabilities and stockholders'
 equity                               $  3,890,420
                                      ============
Net interest income                                $     8,551
                                                   ===========
Net interest spread                                                    0.29%
                                                                ===========
Net interest-earning assets           $    504,669
                                      ============
Net interest margin                                                    0.93%
                                                                ===========
Ratio of interest-earning assets to
 interest-bearing liabilities                           115.86%
                                                   ===========

Deposits (including non-interest
 bearing checking accounts)           $  2,459,385 $     5,330         0.86%

SUPPLEMENTAL INFORMATION
Loan prepayment and late payment fee
 income                                            $     3,708
                                      ------------ -----------  -----------
Borrowing prepayment costs                         $    25,582
                                      ------------ -----------  -----------
Real estate loans (excluding
 prepayment and late payment fees)                                     4.85%
                                      ------------ -----------  -----------
Interest earning assets (excluding
 prepayment and late payment fees)                                     4.67%
                                      ------------ -----------  -----------
Borrowings (excluding prepayment
 costs)                               $    867,438 $     7,286         3.31%
                                      ------------ -----------  -----------
Interest bearing liabilities
 (excluding borrowing prepayment
 costs)                                                                1.58%
                                      ------------ -----------  -----------
Net Interest income (excluding loan
 prepayment and late payment fees and
 borrowing prepayment costs)                       $    30,425
                                      ------------ -----------  -----------
Net Interest margin (excluding loan
 prepayment and late payment fees and
 borrowing prepayment costs)                                           3.30%
                                      ------------ -----------  -----------



              DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
       UNAUDITED SCHEDULE OF NON-PERFORMING ASSETS AND TROUBLED DEBT
                               RESTRUCTURINGS
                           (Dollars In thousands)

                                       At            At             At
                                  December 31,  September 30,  December 31,
Non-Performing Loans                  2013           2013          2012
                                  ------------  -------------  ------------
  One- to four-family and
   cooperative apartment          $      1,242  $       1,136  $        938
  Multifamily residential and
   mixed use residential real
   estate (1)(2)                         1,197          1,993           507
  Mixed use commercial real
   estate (2)                            4,400              -         1,170
  Commercial real estate                 5,707          5,707         6,265
  Construction                               -              -             -
  Other                                      3              2             8
                                  ------------  -------------  ------------
Total Non-Performing Loans (3)    $     12,549  $       8,838  $      8,888
                                  ------------  -------------  ------------
Other Non-Performing Assets
  Other real estate owned                   18              -             -
  Pooled bank trust preferred
   securities (4)                          898            897           892
  Non-performing loans held for
   sale:                                                                  -
    Mixed use commercial real
     estate                                  -              -             -
    Multifamily residential and
     mixed use residential real
     estate                                  -              -           560
                                  ------------  -------------  ------------
Total Non-Performing Assets       $     13,465  $       9,735  $     10,340
                                  ------------  -------------  ------------

Troubled Debt Restructurings ("TDRs") not
 included in non-performing loans (3)
  One- to four-family and
   cooperative apartment                   934            938           948
  Multifamily residential and
   mixed use residential real
   estate (1)(2)                         1,148          1,899         1,953
  Mixed use commercial real
   estate (2)                                -            711           729
  Commercial real estate                16,538         29,570        41,228
                                  ------------  -------------
Total Performing TDRs             $     18,620  $      33,118  $     44,858
                                  ------------  -------------  ------------

(1) Includes loans underlying cooperatives.

(2) While the loans within these categories are often considered
"commercial real estate" in nature, they are classified separately in the
table above to provide further emphasis of the discrete composition of
their underlying real estate collateral.

(3) Total non-performing loans include some loans that were modified in a
manner that met the criteria for a TDR. These non-accruing TDRs, which
totaled $5,707 at December 31, 2013, $5,707 at September 30, 2013 and
$6,265 at December 31, 2012, are included in the non-performing loan table,
but excluded from the TDR amount shown above.

(4) These assets were deemed non-performing since the Company had, as of
the dates indicated, not received any payments of principal or interest on
them for a period of at least 90 days.


PROBLEM ASSETS AS A PERCENTAGE OF TANGIBLE CAPITAL AND RESERVES

                                       At            At             At
                                  December 31,  September 30,  December 31,
                                      2013           2013          2012
                                  ------------  -------------  ------------
Total Non-Performing Assets       $     13,465  $       9,735  $     10,340
Loans 90 days or more past due on
 accrual status (5)                      1,031          1,398           190
                                  ------------  -------------  ------------
  TOTAL PROBLEM ASSETS            $     14,496  $      11,133  $     10,530
                                  ------------  -------------  ------------

Tier One Capital - The Dime
 Savings Bank of Williamsburgh    $    376,717  $     404,022  $    383,042
Allowance for loan losses               20,153         20,540        20,550
                                  ------------  -------------  ------------
  TANGIBLE CAPITAL PLUS RESERVES  $    396,870  $     424,562  $    403,592
                                  ------------  -------------  ------------

PROBLEM ASSETS AS A PERCENTAGE OF
  TANGIBLE CAPITAL AND RESERVES            3.7%           2.6%          2.6%

(5) These loans were, as of the respective dates indicated, expected to be
either satisfied, made current or re-financed within the following twelve
months, and were not expected to result in any loss of contractual
principal or interest. These loans are not included in non-performing
loans.

Contact:
Kenneth Ceonzo
Director of Investor Relations
718-782-6200 extension 8279


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