Third Quarter 2025 Highlights (Compared to Prior Periods):
Net income available to common stockholders was $6.2 million, or $0.27 per diluted share for the three months ended September 30, 2025, as compared to net income available to common stockholders of $5.8 million, or $0.25 per diluted share for the three months ended June 30, 2025 and net income available to common stockholders of $2.2 million, or $0.10 per diluted share for the three months ended September 30, 2024. Total net income for the three months ended September 30, 2025 was $6.5 million. The Company paid dividends of $0.3 million on its preferred stock during the three months ended September 30, 2025.
Included in the $6.2 million of net income available to common stockholders for the third quarter of 2025 results is $46.8 million in interest and dividend income and $1.5 million in non-interest income, offset by $21.6 million in interest expense, $16.6 million in non-interest expense, $2.3 million in provision for income taxes, $1.5 million in provision for credit losses and $0.3 million in dividends on preferred shares.
Net interest income of $25.2 million for the third quarter of 2025 increased $0.8 million, or 3.37%, from the prior quarter and increased $6.2 million, or 32.72%, from the same quarter last year.
Net interest margin was 3.30% for the third quarter of 2025, versus 3.27% for the prior quarter and 2.65% for the same quarter last year.
Nine Months 2025 Highlights (Compared to 2024):
Net income available to common stockholders was $17.7 million, or $0.77 per diluted share for the nine months ended September 30, 2025, as compared to net income available to common stockholders of $7.7 million, or $0.34 per diluted share for the nine months ended September 30, 2024. Total net income for the nine months ended September 30, 2025 was $18.6 million. The Company paid dividends of $0.8 million on its preferred stock during the nine months ended September 30, 2025.
Net interest income for the nine months ended September 30, 2025 was $71.9 million, an increase of $16.1 million, or 28.93%, compared to $55.8 million for the nine months ended September 30, 2024.
Non-interest income for the nine months ended September 30, 2025 was $5.9 million, an increase of $0.8 million, or 15.97%, from $5.1 million for the nine months ended September 30, 2024.
Non-interest expense for the nine months ended September 30, 2025 was $50.4 million, an increase of $0.4 million, or 0.77%, compared to $50.0 million for the nine months ended September 30, 2024.
Cash and equivalents were $146.6 million as of September 30, 2025, an increase of $6.7 million, or 4.82%, from $139.8 million as of December 31, 2024.
Securities totaled $379.9 million as of September 30, 2025, a decrease of $93.0 million, or 19.66%, from $472.9 million as of December 31, 2024 primarily due to regular principal payments, the call of three available-for-sale securities in the total amount of $7.0 million and the maturity/call of three held-for-sale securities in the amount of $50.0 million.
Net loans receivable were $2.49 billion as of September 30, 2025, an increase of $203.4 million, or 8.90%, from $2.29 billion as of December 31, 2024.
Deposits were $2.06 billion as of September 30, 2025, an increase of $167.9 million, or 8.86%, from $1.90 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 "In these uncertain times, we continue to execute on our long-term strategy of increasing margin through yield improvement and controlled cost of funds and operating expenses. We are very pleased with the results. We note our incremental profitability year-on-year and the consistency of our earnings. Our diluted earnings per share of $0.77 for the nine months ended September 30, 2025, more than doubled from the same period last year, driven by incremental net interest and non-interest income, achieved while keeping non-interest expenses almost flat. Our net interest margin this quarter increased by 3 basis points compared to the prior quarter, reflecting our decreasing funding costs. We were also busy working on the future and opened a new branch in the Inwood neighborhood of Manhattan and modernized our charter, becoming both a financial holding company and a bank holding company while Ponce Bank converted to a national bank. These developments should enhance our funding sources and level our playing fields."
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. Our strong level of loan originations from April 2025 to September 2025 ensures that our dividend yield will continue at the 0.50% level in the next dividend period starting in 2026. 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 13 quarters, including the quarter ended September 30, 2025, we are at 81% deep impact lending."
The table below indicate the Key Metrics at or for the three months ended:
At or for the Three Months Ended
September 30,
June 30,
March 31,
December 31,
September 30,
2025
2025
2025
2024
2024
Performance Ratios:
Return on average assets (1)
0.82
%
0.79
%
0.77
%
0.38
%
0.33
%
Return on common equity (1)
8.10
%
7.88
%
7.97
%
3.76
%
3.06
%
Net interest margin (1) (2)
3.30
%
3.27
%
2.98
%
2.80
%
2.65
%
Non-interest expense to average assets (1)
2.10
%
2.18
%
2.19
%
2.25
%
2.19
%
Efficiency ratio (3)
62.15
%
63.69
%
68.70
%
75.63
%
80.87
%
Capital Ratios:
Total capital to risk-weighted assets (Ponce Financial Group)
24.08
%
22.65
%
22.84
%
22.98
%
22.87
%
Common equity Tier 1 capital to risk-weighted assets (Ponce Financial Group)
13.39
%
12.49
%
12.51
%
12.44
%
12.28
%
Tier 1 capital to total assets (Ponce Financial Group)
17.33
%
17.13
%
16.84
%
17.70
%
17.81
%
Total capital to risk-weighted assets (Bank only)
21.79
%
21.22
%
21.38
%
21.47
%
21.61
%
Common equity Tier 1 capital to risk-weighted assets (Bank only)
20.66
%
20.15
%
20.35
%
20.40
%
20.45
%
Tier 1 capital to total assets (Bank only)
16.08
%
15.99
%
15.61
%
15.81
%
16.19
%
Asset Quality Ratios:
Allowance for credit losses on loans as a percentage of total loans
0.98
%
0.97
%
0.96
%
0.97
%
1.09
%
Allowance for credit losses on loans as a percentage of nonperforming loans
88.88
%
101.01
%
84.15
%
82.29
%
139.52
%
Net (charge-offs) recoveries to average outstanding loans (1)
(0.03
%)
(0.04
%)
(0.04
%)
(0.45
%)
(0.17
%)
Non-performing loans as a percentage of total assets
0.88
%
0.76
%
0.88
%
0.90
%
0.57
%
Other:
Number of offices
18
17
18
19
19
Number of full-time equivalent employees
209
206
211
218
228
(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 September 30, 2025 was $6.5 million compared to net income of $6.1 million for the three months ended June 30, 2025 and net income of $2.4 million for the three months ended September 30, 2024.
The $0.4 million increase of net income for the three months ended September 30, 2025 compared to the three months ended June 30, 2025 was attributed mainly to an increase of $0.8 million in net interest income and decreases of $0.3 million in provision for credit losses and $0.3 million in non-interest expense, offset by a decrease of $0.6 million in non-interest income and an increase of $0.4 million in provision for income taxes.
The $4.1 million increase of net income for the three months ended September 30, 2025 compared to the three months ended September 30, 2024 was largely due to increases of $6.2 million in net interest income and $0.3 million in non-interest income, offset by increases of $1.6 million in provision for income taxes and $0.8 million in provision for credit losses while remain flat on non-interest expense
Net income for the nine months ended September 30, 2025 was $18.6 million compared to net income of $8.0 million for the nine months ended September 30, 2024. The $10.5 million increase of net income for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 was attributed mainly to increases of $16.1 million in net interest income and $0.8 million in non-interest income, partially offset by increases of $3.1 million in provision for credit losses, $2.9 million in provision for income taxes and $0.4 million in non-interest expense.
Net Interest Income and Net Interest Margin
Net interest income for the three months ended September 30, 2025, increased $0.8 million, or 3.37%, to $25.2 million compared to $24.4 million for the three months ended June 30, 2025 and increased $6.2 million, or 32.72%, compared to $19.0 million for the three months ended September 30, 2024.
The $0.8 million increase in net interest income from the three months ended June 30, 2025 was attributable to an increase of $1.0 million in total interest and dividend income, offset by an increase of $0.2 million in total interest expense. The $6.2 million increase in net interest income from the three months ended September 30, 2024 was attributable to an increase of $5.6 million in total interest and dividend income and a decrease of $0.7 million in total interest expense.
Net interest income for the nine months ended September 30, 2025, increased $16.1 million, or 28.93%, to $71.9 million compared to $55.8 million for the nine months ended September 30, 2024. The $16.1 million increase in net interest income was attributable to an increase of $17.0 million in total interest and dividend income, offset by an increase of $0.8 million in total interest expense.
Net interest margin was 3.30% for the three months ended September 30, 2025 compared to 3.27% for the prior quarter, an increase of 3bps and 2.65% for the same period last year, an increase of 65bps.
Net interest margin was 3.18% for the nine months ended September 30, 2025 compared to 2.66% for the nine months ended September 30, 2024, an increase of 52bps.
Non-interest Income
Non-interest income for the three months ended September 30, 2025, was $1.5 million, a decrease of $0.6 million, or 27.57%, compared to $2.1 million for the three months ended June 30, 2025 and an increase of $0.3 million, or 29.63%, compared to $1.2 million for the three months ended September 30, 2024.
The $0.6 million decrease in non-interest income from the three months ended June 30, 2025 was largely attributable to decreases of$0.5 million in other non-interest income attributable to the Bank's investment in Oaktree SBIC Fund, L.P. ("Oaktree") as a result of a loss from Oaktree's investment and $0.1 million in late and prepayment charges.
The $0.3 million increase in non-interest income from the three months ended September 30, 2024 was largely attributable to increases of $0.4 million in grant income and $0.3 million in late and prepayment charges, partially offset by a decrease of $0.4 million in other non-interest income attributable to the Bank's investment in Oaktree as a result of a loss from Oaktree's investment.
Non-interest income for the nine months ended September 30, 2025, was $5.9 million, an increase of $0.8 million, or 15.97%, compared to $5.1 million for the nine months ended September 30, 2024. The $0.8 million increase in non-interest income was largely attributable to increases of $0.9 million in grant income, $0.8 million in late and prepayment charges and $0.4 million in income on sale of SBA loans, partially offset by decreases of $1.0 million in other non-interest income attributable to the Bank's investment in Oaktree as a result of a loss from Oaktree's investment and $0.3 million in income on the sale of mortgage loans.
Non-interest Expense
Non-interest expense for the three months ended September 30, 2025 was $16.6 million, a decrease of $0.3 million, or 1.49%, compared to $16.9 million for the three months ended June 30, 2025 and remained flat at $16.6 million when compared to the three months ended September 30, 2024.
The $0.3 million decrease in non-interest expense from the three months ended June 30, 2025 was mainly attributable to decreases of $0.3 million in federal deposit insurance and regulatory assessment, $0.2 million in other non-interest expense, partially offset by an increase of $0.2 million in compensation and benefits.
Non-interest expense for the nine months ended September 30, 2025, was $50.4 million, an increase of $0.4 million, or 0.77%, compared to $50.0 million for the nine months ended September 30, 2024. The $0.4 million increase in non-interest expense was mainly attributable to increases of $0.7 million in occupancy and equipment, $0.4 million in data processing expenses and $0.4 million in other operating expense, partially offset by decreases of $1.2 million in direct loan expenses and $0.3 million in professional fees.
Credit Quality:
Total non-performing assets and accruing modifications to borrowers experiencing financial difficulty were $32.4 million at September 30, 2025 compared to $28.5 million at June 30, 2025 and $22.0 million at September 30, 2024.
During the three months ended September 30, 2025, a credit loss provision of $1.4 million on loans was recorded, consisting of $0.9 million charged on the funded portion and $0.5 million charged on the unfunded portion on loans. 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 September 30, 2024, a credit loss provision of $0.5 million on loans was recorded, consisting of $0.8 million charged on the funded portion on loans and a benefit of $0.3 million on the unfunded portion on loans.
During the nine months ended September 30, 2025, a credit loss provision of $2.7 million on loans was recorded, consisting of $2.9 million charged on the funded portion and a benefit of $0.2 million on the unfunded portion on loans. During the nine months ended September 30, 2024, a credit loss benefit of $0.2 million on loans was recorded, consisting of $0.4 million charged on the funded portion on loans and a benefit of $0.6 million on unfunded portion on loans.
Balance Sheet Summary
Total assets increased $117.1 million, or 3.85%, to $3.16 billion as of September 30, 2025 from $3.04 billion as of December 31, 2024. The increase in total assets is largely attributable to increases of $203.4 million in net loans receivable, $8.1 million in other assets, $6.7 million in cash and cash equivalents, $1.1 million in accrued interest receivable and $0.3 million in deferred tax asset, partially offset by decreases of $82.8 million in held-to-maturity securities, $10.1 million in available-for-sale securities, $4.9 million in mortgage loans held for sale, $3.2 million in Federal Home Loan Bank of New York stock, $0.8 million in right of use asset and $0.7 million in premises and equipment, net.
Total liabilities increased $92.8 million, or 3.66%, to $2.63 billion as of September 30, 2025 from $2.53 billion as of December 31, 2024. The increase in total liabilities was largely attributable to increases of $164.0 million in deposits, $3.9 million in advance payments by borrowers for taxes and insurance and $0.7 million in accrued interest payable, partially offset by decreases of $75.0 million in borrowings and $0.7 million in operating lease liabilities.
Total stockholders' equity increased $24.3 million, or 4.81%, to $529.8 million as of September 30, 2025, from $505.5 million as of December 31, 2024. The $24.3 million increase in stockholders' equity was largely attributable to $18.6 million in net income, $3.7 million in other comprehensive income, $1.4 million impact to additional paid in capital as a result of share-based compensation, $1.4 million from release of ESOP shares and $0.1 million from exercise of stock options, offset by $0.8 million in dividends on preferred shares.
About Ponce Financial Group, Inc.
Ponce Financial Group, Inc. is the holding company for Ponce Bank, N.A.. Ponce Bank, N.A. is a Minority Depository Institution, a Community Development Financial Institution, and a certified Small Business Administration lender. Ponce Bank, N.A.'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. N.A. 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, Federal Home Loan Bank stock and Federal Reserve 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, N.A. operates, including changes that adversely affect borrowers' ability to service and repay Ponce Bank, N.A.'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, N.A.'s market area; Ponce Bank, N.A.'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 SubsidiariesConsolidated Statements of Financial Condition(Dollars in thousands, except for share data)
As of
September 30,
June 30,
March 31,
December 31,
September 30,
2025
2025
2025
2024
2024
ASSETS
Cash and due from banks:
Cash
$
29,296
$
35,767
$
32,113
$
35,478
$
32,061
Interest-bearing deposits
117,283
90,872
97,780
104,361
123,751
Total cash and cash equivalents
146,579
126,639
129,893
139,839
155,812
Available-for-sale securities, at fair value
94,822
96,562
103,570
104,970
111,005
Held-to-maturity securities, at amortized cost
285,125
336,879
358,024
367,938
403,736
Placement with banks
249
249
249
249
249
Mortgage loans held for sale, at fair value
5,794
5,703
8,567
10,736
9,566
Loans receivable, net
2,490,046
2,458,712
2,370,931
2,286,599
2,180,331
Accrued interest receivable
18,903
19,126
19,008
17,771
16,890
Premises and equipment, net
16,129
16,067
16,417
16,794
16,843
Right of use assets
28,295
28,806
29,496
29,093
29,785
Federal Home Loan Bank of New York stock (FHLBNY), at cost
25,945
26,620
25,807
29,182
28,515
Deferred tax assets
12,402
12,143
11,629
12,074
11,845
Other assets
32,790
26,363
16,245
24,693
51,392
Total assets
$
3,157,079
$
3,153,869
$
3,089,836
$
3,039,938
$
3,015,969
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Deposits (1)
$
2,063,081
$
2,053,151
$
2,017,848
$
1,895,213
$
1,884,056
Operating lease liabilities
30,028
30,501
31,126
30,696
31,343
Accrued interest payable
4,372
4,161
4,628
3,712
2,918
Borrowings
521,100
536,100
521,100
596,100
580,421
Other liabilities
8,663
8,868
1,248
8,717
12,642
Total liabilities
2,627,244
2,632,781
2,575,950
2,534,438
2,511,380
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
(7,270
)
(7,404
)
(7,641
)
(7,707
)
(9,445
)
Additional paid-in-capital
208,909
208,275
207,888
207,319
208,478
Retained earnings
125,477
119,250
113,432
107,754
105,103
Accumulated other comprehensive loss
(11,586
)
(13,047
)
(13,515
)
(15,297
)
(12,686
)
Unearned compensation ─ ESOP
(10,944
)
(11,235
)
(11,527
)
(11,818
)
(12,110
)
Total stockholders' equity
529,835
521,088
513,886
505,500
504,589
Total liabilities and stockholders' equity
$
3,157,079
$
3,153,869
$
3,089,836
$
3,039,938
$
3,015,969
(1) As of June 30, 2025, March 31. 2025, December 31, 2024 and September 30, 2024, Advance payments by borrowers for taxes and insurance in the amounts of $10.9 million, $12.9 million, $10.3 million and $13.7 million, respectively, were reclassified to Deposits.
Ponce Financial Group, Inc. and SubsidiariesConsolidated Statements of Operations(Dollars in thousands, except per share data)
Three Months Ended
September 30,
June 30,
March 31,
December 31,
September 30,
2025
2025
2025
2024
2024
Interest and dividend income:
Interest on loans receivable
$
41,486
$
40,291
$
37,136
$
35,622
$
32,945
Interest on deposits due from banks
978
807
1,668
1,783
2,430
Interest and dividend on securities and FHLBNY stock
4,383
4,762
5,193
5,481
5,918
Total interest and dividend income
46,847
45,860
43,997
42,886
41,293
Interest expense:
Interest on certificates of deposit
6,553
7,382
7,754
8,104
6,926
Interest on other deposits
9,996
9,058
8,554
8,476
8,519
Interest on borrowings
5,050
4,994
5,486
5,576
6,825
Total interest expense
21,599
21,434
21,794
22,156
22,270
Net interest income
25,248
24,426
22,203
20,730
19,023
Provision (benefit) for credit losses (1)
1,364
1,626
(285
)
897
537
Net interest income after provision (benefit) for credit losses
23,884
22,800
22,488
19,833
18,486
Non-interest income:
Service charges and fees
539
511
525
500
508
Brokerage commissions
8
—
4
44
—
Late and prepayment charges
385
530
697
318
77
Income on sale of mortgage loans
166
169
148
254
218
Income on sale of SBA loans
—
—
404
148
—
Grant income
429
428
—
—
—
Other
(35
)
422
603
833
348
Total non-interest income
1,492
2,060
2,381
2,097
1,151
Non-interest expense:
Compensation and benefits
7,868
7,627
7,780
7,668
7,674
Occupancy and equipment
3,934
3,907
3,913
3,863
3,786
Data processing expenses
1,296
1,188
1,152
1,143
1,099
Direct loan expenses
155
241
388
617
573
Insurance and surety bond premiums
318
297
315
293
292
Office supplies, telephone and postage
170
174
170
294
222
Professional fees
1,409
1,367
1,364
1,703
1,351
Microloans recoveries
—
—
—
(29
)
(54
)
Marketing and promotional expenses
184
266
83
289
180
Federal deposit insurance and regulatory assessment (2)
266
546
461
418
392
Other operating expenses (2)
1,018
1,256
1,262
1,206
1,051
Total non-interest expense (1)
16,618
16,869
16,888
17,465
16,566
Income before income taxes
8,758
