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The First of Long Island Corporation Reports Earnings for the First Quarter of 2025

1. FLIC net income increased by $512,000 over the prior quarter. 2. Noninterest expenses decreased due to branch consolidations, offset by merger costs. 3. 1Q 2025 net income at $3.8 million, down from $4.4 million YoY. 4. Provisions for credit losses rose, signaling potential credit risk uptick. 5. Liquidity remains strong with $878.1 million available on March 31, 2025.

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Why Neutral?

While quarterly earnings improved sequentially, year-on-year performance declined, indicating mixed signals.

How important is it?

The reported earnings showcase operational efficiency, yet declining EPS and rising credit provisions signal caution.

Why Short Term?

Recent earnings trends could affect investor sentiment in the near term.

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MELVILLE, N.Y., April 30, 2025 (GLOBE NEWSWIRE) -- The First of Long Island Corporation (Nasdaq: FLIC, the “Company” or the “Corporation”), the parent of The First National Bank of Long Island (the “Bank”), reported earnings for the three months ended March 31, 2025. Analysis of Earnings – First Quarter 2025 Versus Linked Quarter Net income for the first quarter of 2025 increased $512,000 compared to the fourth quarter of 2024. The increase in net income was primarily due to a $795,000 increase in net interest income largely due to an eight basis point improvement in the net interest margin, and a decrease in noninterest expense of $1.5 million primarily due to branch consolidation expenses of $1.4 million and vesting of equity awards during the fourth quarter of 2024 offset by pending merger related system conversion expenses of $468,000 and debit card chargeoffs of $243,000 during the first quarter of 2025. These were partially offset by a provision for credit losses of $168,000 as compared to a provision reversal for credit losses of $381,000 in the fourth quarter, a decrease in noninterest income of $503,000 primarily due to $233,000 of back-to-back swap fees and $225,000 of bank-owned life insurance ("BOLI") benefit payments earned in the fourth quarter, and an increase in income tax expense of $761,000 substantially due to a decrease in the percentage of pre-tax income derived from the Bank's real estate investment trust, increasing the state and local income tax due.  Analysis of Earnings - First Quarter 2025 Versus First Quarter of 2024 Net income and earnings per share ("EPS") for the quarter ended March 31, 2025 were $3.8 million and $0.17, respectively, as compared to $4.4 million and $0.20, respectively, for the comparable quarter in 2024. The principal drivers of the change in net income were an increase in net interest income of $661,000, or 3.6%, which was more than offset by an increase in the provision for credit losses of $168,000, an increase in noninterest expense of $922,000, and an increase in income tax expense of $193,000. The quarter produced a return on average assets ("ROA") of 0.37%, return on average equity ("ROE") of 3.98%, and a net interest margin of 1.91%. Net interest income increased when comparing the first quarters of 2025 and 2024 primarily due to a decrease in interest expense of $2.0 million which was partially offset by a $1.4 million decrease in interest income. The decrease in interest expense was a combination of a 16 basis points decrease in the cost of interest-bearing liabilities and a decrease in average interest-bearing liabilities of $92.9 million. The decrease in interest income resulted from interest-earning assets decreasing by $156.6 million offset by the yield on interest-earning assets increasing two basis points. In the first quarter of 2025, the Bank recorded a provision for credit losses of $168,000. The Bank did not record a provision in the first quarter of 2024. The allowance for credit losses remained relatively flat when compared to year-end 2024 largely due to declines in historical loss rates and loan balances which were offset by an increase due to deterioration in current and forecasted economic conditions, including adjustments for economic uncertainty. The reserve coverage ratio ticked up one basis point to 0.89% of total loans at March 31, 2025 as compared to 0.88% at December 31, 2024. Past due loans and nonaccrual loans were at $7.5 million and $3.5 million, respectively, on March 31, 2025. Overall, the credit quality of the loan and investment portfolios remains strong. Noninterest income decreased $57,000, or 2.1%, when comparing the first quarters of 2025 and 2024 mainly due to 2024 nonrecurring items of $114,000 in real estate tax refunds, $60,000 in BOLI benefit payments, $50,000 in joint marketing fees and an additional one-time service charge cycle related to the Bank's core system conversion, which were partially offset by increases of $96,000 in merchant card service fees and $72,000 in BOLI accretion. Noninterest expense increased $922,000, or 5.7%, for the first quarter of 2025, as compared to the first quarter of 2024. The change in noninterest expense is mainly attributable to the current year's expenses related to the pending merger. Noninterest expense increased due to merger expenses of $230,000, merger related system conversion expenses of $468,000, debit card chargeoffs of $243,000 and higher legal fees, partially offset by a 2.6% year-over-year decrease in salaries and employee benefits.  The decrease in salaries and employee benefits was due to a decrease in full time equivalent employees, primarily the result of branch closings in 2024. Income tax expense increased $193,000 due to an increase in the effective tax rate from 6.2% in the first quarter of 2024 to 11.5% in the current quarter. The increase in the effective tax rate is mainly due to the same reasons discussed above with respect to the linked quarter changes.  Liquidity Total average deposits declined by $51.9 million when comparing the first quarters of 2025 and 2024. There were no overnight advances on March 31, 2025 or December 31, 2024. On March 31, 2025, other borrowings were down by $75.0 million from year-end 2024. At March 31, 2025, the Bank had $653.3 million in collateralized borrowing lines with the Federal Home Loan Bank of New York and the Federal Reserve Bank, a $20.0 million unsecured line of credit with a correspondent bank and $204.8 million in unencumbered securities. In total, $878.1 million in liquidity was available on March 31, 2025. Uninsured deposits were 49.5% of total deposits at March 31, 2025.  Capital The Corporation’s capital position remains strong with a leverage ratio of approximately 10.29% on March 31, 2025. Book value per share was $16.91 on March 31, 2025, versus $16.77 on December 31, 2024. The Company declared its quarterly cash dividend of $0.21 per share during the quarter. There were no share repurchases during the quarter. Forward Looking Information This earnings release contains various “forward-looking statements” within the meaning of that term as set forth in Rule 175 of the Securities Act of 1933 and Rule 3b-6 of the Securities Exchange Act of 1934. Such statements are generally contained in sentences including the words “may” or “expect” or “could” or “should” or “would” or “believe” or “anticipate”. The Corporation cautions that these forward-looking statements are subject to numerous assumptions, risks and uncertainties that could cause actual results to differ materially from those contemplated by the forward-looking statements. Factors that could cause future results to vary from current management expectations include, but are not limited to, changing economic conditions; legislative and regulatory changes; changes in domestic or international governmental policies, including the imposition of tariffs; monetary and fiscal policies of the federal government; changes in interest rates; deposit flows and the cost of funds; demand for loan products; competition; changes in management’s business strategies; changes in accounting principles, policies or guidelines; changes in real estate values; and other factors discussed in the “risk factors” section of the Corporation’s filings with the Securities and Exchange Commission (“SEC”). The forward-looking statements are made as of the date of this press release, and the Corporation assumes no obligation to update the forward-looking statements or to update the reasons why actual results could differ from those projected in the forward-looking statements. For more detailed financial information please see the Corporation’s quarterly report on Form 10-Q for the quarter ended March 31, 2025. The Form 10-Q will be available through the Bank’s website at www.fnbli.com on or about May 1, 2025, when it is anticipated to be electronically filed with the SEC. Our SEC filings are also available on the SEC’s website at www.sec.gov.       CONSOLIDATED BALANCE SHEETS(Unaudited)       3/31/2025  12/31/2024  (dollars in thousands) Assets:       Cash and cash equivalents$67,555  $38,330 Investment securities available-for-sale, at fair value 615,350   624,779         Loans:       Commercial and industrial 134,095   136,732 Secured by real estate:       Commercial mortgages 1,929,881   1,963,107 Residential mortgages 1,065,380   1,084,090 Home equity lines 33,452   36,468 Consumer and other 1,126   1,210   3,163,934   3,221,607 Allowance for credit losses (28,308)  (28,331)  3,135,626   3,193,276         Restricted stock, at cost 24,329   27,712 Bank premises and equipment, net 28,411   29,135 Right-of-use asset - operating leases 18,358   18,951 Bank-owned life insurance 117,471   117,075 Pension plan assets, net 11,693   11,806 Deferred income tax benefit 35,022   36,192 Other assets 22,491   22,080  $4,076,306  $4,119,336 Liabilities:       Deposits:       Checking$1,072,766  $1,074,671 Savings, NOW and money market 1,587,030   1,574,160 Time 635,789   616,027   3,295,585   3,264,858         Overnight advances —   — Other borrowings 360,000   435,000 Operating lease liability 20,348   21,964 Accrued expenses and other liabilities 17,533   18,648   3,693,466   3,740,470 Stockholders' Equity:       Common stock, par value $0.10 per share:       Authorized, 80,000,000 shares;       Issued and outstanding, 22,635,724 and 22,595,349 shares 2,264   2,260 Surplus 79,866   79,731 Retained earnings 353,043   354,051   435,173   436,042 Accumulated other comprehensive loss, net of tax (52,333)  (57,176)  382,840   378,866  $4,076,306  $4,119,336                     CONSOLIDATED STATEMENTS OF INCOME(Unaudited)    Three Months Ended  3/31/2025  3/31/2024  (dollars in thousands) Interest and dividend income:       Loans$33,785  $33,543 Investment securities:       Taxable 5,374   6,993 Nontaxable 956   960   40,115   41,496 Interest expense:       Savings, NOW and money market deposits 10,318   10,083 Time deposits 6,403   6,977 Overnight advances 71   263 Other borrowings 4,501   6,012   21,293   23,335 Net interest income 18,822   18,161 Provision for credit losses 168   — Net interest income after provision for credit losses 18,654   18,161         Noninterest income:       Bank-owned life insurance 912   840 Service charges on deposit accounts 829   880 Net loss on sales of securities —   — Other 976   1,054   2,717   2,774 Noninterest expense:       Salaries and employee benefits 9,711   9,974 Occupancy and equipment 3,233   3,214 Merger expenses 230   — Other 3,954   3,018   17,128   16,206 Income before income taxes 4,243   4,729 Income tax expense 487   294 Net income$3,756  $4,435         Share and Per Share Data:       Weighted Average Common Shares 22,625,117   22,520,568 Dilutive restricted stock units 86,270   73,827 Dilutive weighted average common shares 22,711,387   22,594,395         Basic EPS$0.17  $0.20 Diluted EPS 0.17   0.20 Cash Dividends Declared per share 0.21   0.21         FINANCIAL RATIOS (Unaudited) ROA 0.37%  0.42%ROE 3.98   4.72 Net Interest Margin 1.91   1.79                       PROBLEM AND POTENTIAL PROBLEM LOANS AND ASSETS(Unaudited)       3/31/2025  12/31/2024  (dollars in thousands) Loans including modifications to borrowers experiencing financial difficulty:       Modified and performing according to their modified terms$419  $421 Past due 30 through 89 days 7,452   270 Past due 90 days or more and still accruing —   — Nonaccrual 3,510   3,229   11,381   3,920 Other real estate owned —   —  $11,381  $3,920         Allowance for credit losses$28,308  $28,331 Allowance for credit losses as a percentage of total loans 0.89%  0.88%Allowance for credit losses as a multiple of nonaccrual loans 8.1x  8.8x                   AVERAGE BALANCE SHEET, INTEREST RATES AND INTEREST DIFFERENTIAL(Unaudited)    Three Months Ended March 31,  2025  2024  Average  Interest/ Average  Average  Interest/ Average (dollars in thousands)Balance  Dividends Rate  Balance  Dividends Rate Assets:                   Interest-earning bank balances$28,537  $313 4.45% $55,117  $751 5.48%Investment securities:                   Taxable (1) 568,162   5,061 3.56   638,857   6,242 3.91 Nontaxable (1) (2) 151,745   1,210 3.19   153,417   1,215 3.17 Loans (1) 3,185,771   33,785 4.24   3,243,445   33,543 4.14 Total interest-earning assets 3,934,215   40,369 4.10   4,090,836   41,751 4.08 Allowance for credit losses (28,399)        (28,947)      Net interest-earning assets 3,905,816         4,061,889       Cash and due from banks 28,197         31,703       Premises and equipment, net 28,912         31,257       Other assets 130,528         120,884        $4,093,453        $4,245,733       Liabilities and Stockholders' Equity:                   Savings, NOW & money market deposits$1,572,109   10,318 2.66  $1,534,081   10,083 2.64 Time deposits 612,730   6,403 4.24   643,854   6,977 4.36 Total interest-bearing deposits 2,184,839   16,721 3.10   2,177,935   17,060 3.15 Overnight advances 6,322   71 4.55   18,846   263 5.61 Other borrowings 416,944   4,501 4.38   504,258   6,012 4.80 Total interest-bearing liabilities 2,608,105   21,293 3.31   2,701,039   23,335 3.47 Checking deposits 1,067,804         1,126,593       Other liabilities 35,260         40,014         3,711,169         3,867,646       Stockholders' equity 382,284         378,087        $4,093,453        $4,245,733                           Net interest income (2)    $19,076        $18,416   Net interest spread (2)       0.79%        0.61%Net interest margin (2)       1.91%        1.79% (1)The average balances of loans include nonaccrual loans. The average balances of investment securities exclude unrealized gains and losses on available-for-sale securities.(2)Tax-equivalent basis. Interest income on a tax-equivalent basis includes the additional amount of interest income that would have been earned if the Corporation's investment in tax-exempt investment securities had been made in investment securities subject to federal income taxes yielding the same after-tax income. The tax-equivalent amount of $1.00 of nontaxable income was $1.27 for each period presented using the statutory federal income tax rate of 21%.   For More Information Contact:Janet Verneuille, SEVP and CFO(516) 671-4900, Ext. 7462

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