Investors Bancorp (ISBC) 8-KInvestors Bancorp, Inc. Announces Fourth Quarter Financial Results and Cash Dividend

Short Hills, N.J. - (PR NEWSWIRE) - January 26, 2022 - Investors Bancorp, Inc. (NASDAQ:ISBC) (“Company”), the holding company for Investors Bank (“Bank”), reported net income of $94.3 million, or $0.40 per diluted share, for the three months ended December 31, 2021 as compared to $66.9 million, or $0.28 per diluted share, for the three months ended September 30, 2021 and $75.1 million, or $0.32 per diluted share, for the three months ended December 31, 2020.

For the year ended December 31, 2021, net income totaled $313.3 million, or $1.33 per diluted share, compared to $221.6 million, or $0.94 per diluted share, for the year ended December 31, 2020.

The Company also announced today that its Board of Directors declared a cash dividend of $0.16 per share to be paid on February 25, 2022 for stockholders of record as of February 10, 2022.

Kevin Cummings, Chairman and CEO, commented, “We closed the year out on a strong note, with both loans and non-interest bearing deposits growing at double-digit annualized levels. In addition, our profitability reached new heights as the economy and the real estate markets continued to improve over the course of the year. Return on average assets was 1.17% and return on average tangible equity was 12% for the year ended 2021. Importantly, our balance sheet is better positioned for rising rates than it was during the last rising interest rate cycle.”

Mr. Cummings also commented, “With Shareholder approval received in November, we look forward to the completion of our merger with Citizens. As we await regulatory approvals of the deal, our teams continue to work to ensure a smooth closing and transition.”

Total assets increased $1.78 billion, or 6.9%, to $27.81 billion at December 31, 2021 from $26.02 billion December 31, 2020. Cash and cash equivalents increased $117.6 million to $288.0 million at December 31, 2021. Net loans increased $1.76 billion, or 8.6%, to $22.34 billion at December 31, 2021. Securities decreased $46.8 million, or 1.2%, to $4.00 billion at December 31, 2021.

During the year ended December 31, 2021, we originated $2.43 billion in multi-family loans, $1.27 billion in residential loans, $1.26 billion in commercial and industrial loans, $1.24 billion in commercial real estate loans, $170.6 million in construction loans and $118.2 million in consumer and other loans. In addition, we acquired $219 million of loans from Berkshire Bank. Our loans are primarily on properties and businesses located in New Jersey and New York.

In addition to the loans originated for our portfolio, we originated residential mortgage loans for sale to third parties totaling $145.0 million during the year ended December 31, 2021. As of December 31, 2021, loans held for sale were $809,000.

The allowance for loan losses decreased by $42.3 million to $240.7 million at December 31, 2021 from $283.0 million at December 31, 2020. The decrease reflects a negative provision for loan losses of $43.8 million, partially offset by an increase of $541,000 resulting from net recoveries and an increase of approximately $1.0 million from the initial allowance on loans identified as PCD which were acquired from Berkshire Bank. Our allowance for loan losses and related provision were affected by the improving current and forecasted economic conditions and commercial real estate prices. Future increases in the allowance for loan losses may be necessary based on the growth and composition of the loan portfolio, the level of loan delinquency and the current and forecasted economic conditions over the life of our loans. At December 31, 2021, our allowance for loan losses as a percent of total loans was 1.07%, a decrease from 1.36% at December 31, 2020 which was driven by the factors noted above.

Securities decreased by $46.8 million, or 1.2%, to $4.00 billion at December 31, 2021 from $4.04 billion at December 31, 2020. This decrease was primarily a result of paydowns and sales, partially offset by purchases.

Deposits increased by $1.30 billion, or 6.7%, to $20.82 billion at December 31, 2021 from $19.53 billion at December 31, 2020 primarily driven by an increase in checking account deposits, partially offset by decreases in time deposits and money market deposits. Checking account deposits increased $2.22 billion to $11.93 billion at December 31, 2021 from $9.71 billion at December 31, 2020. Core deposits (savings, checking and money market) represented approximately 90% of our total deposit portfolio at December 31, 2021 compared to 86% at December 31, 2020. Non interest checking increased $995.2 million, or 27.2% to $4.66 billion for the year ended December 31, 2021

Borrowed funds increased by $239.2 million, or 7.3%, to $3.54 billion at December 31, 2021 from $3.30 billion at December 31, 2020 to support balance sheet growth.

Stockholders’ equity increased by $228.4 million to $2.94 billion at December 31, 2021 from $2.71 billion at December 31, 2020, primarily attributable to net income of $313.3 million, share-based plan activity of $32.1 million and other comprehensive income of $33.7 million for the year ended December 31, 2021. These increases were partially offset by cash dividends of $0.56 per share totaling $138.6 million and the repurchase of approximately 1.0 million shares of common stock for $12.1 million during the year ended December 31, 2021. The Company remains above the FDIC’s “well capitalized” standards, with a Common Equity Tier 1 Risk-Based Ratio of 12.83% at December 31, 2021.

Investors Bancorp, Inc. is the holding company for Investors Bank, which as of December 31, 2021 operated from its corporate headquarters in Short Hills, New Jersey and 154 branches located throughout New Jersey, New York and Pennsylvania.

Certain statements contained herein are “forward looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward looking statements may be identified by reference to a future period or periods, or by the use of forward looking terminology, such as “may,” “will,” “believe,” “expect,” “estimate,” “anticipate,” “continue,” or similar terms or variations on those terms, or the negative of those terms. Forward looking statements are subject to numerous risks and uncertainties, as described in the “Risk Factors” disclosures included in our Annual Report on Form 10-K, as supplemented in quarterly reports on Form 10-Q, including, but not limited to, those related to the real estate and economic environment, particularly in the market areas in which the Company operates, competitive products and pricing, fiscal and monetary policies of the U.S. Government, changes in government regulations affecting financial institutions, including regulatory fees and capital requirements, changes in prevailing interest rates, failure to consummate the transaction with Citizens Financial Group, Inc. for any reason, including the failure to obtain necessary regulatory approvals (and the risk that such approvals may result in the imposition of conditions that could adversely affect the combined company), failure to obtain shareholder approval or failure to satisfy any of the other closing conditions in a timely basis or at all; the diversion of management’s time from ongoing business operations due to issues relating to the transaction with Citizens Financial Group, Inc., the occurrence of any event, change or other circumstances that could give rise to the right of one or both of the parties to terminate the merger agreement between the Company and Citizens Financial Group, Inc., the outcome of any legal proceedings that may be instituted against Citizens Financial Group, Inc. or the Company, potential adverse reactions or changes to business or employee relationships, including those resulting

from the announcement or completion of the transaction, acquisitions and the integration of acquired businesses, credit risk management, asset-liability management, the financial and securities markets and the availability of and costs associated with sources of liquidity. Further, given its ongoing and dynamic nature, it is difficult to predict what the continuing effects of the COVID-19 pandemic will have on our business and results of operations. The pandemic and related local and national economic disruption may, among other effects, continue to result in a material adverse change for the demand for our products and services; increased levels of loan delinquencies, problem assets and foreclosures; branch disruptions, unavailability of personnel and increased cybersecurity risks as employees work remotely.

The Company wishes to caution readers not to place undue reliance on any such forward looking statements, which speak only as of the date made. The Company wishes to advise readers that the factors listed above could affect the Company’s financial performance and could cause the Company’s actual results for future periods to differ materially from any opinions or statements expressed with respect to future periods in any current statements. The Company does not undertake and specifically declines any obligation to publicly release the results of any revisions that may be made to any forward looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.

We believe that providing certain non-GAAP financial measures provides investors with information useful in understanding our financial performance, our performance trends and financial position. We utilize these measures for internal planning and forecasting purposes. We believe that our presentation and discussion, together with the accompanying reconciliations, provides a complete understanding of factors and trends affecting our business and allows investors to view performance in a manner similar to management. These non-GAAP measures should not be considered a substitute for GAAP basis measures and results, and we strongly encourage investors to review our consolidated financial statements in their entirety and not to rely on any single financial measure. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies’ non-GAAP financial measures having the same or similar names.