 NEW YORK, July 28, 2020 GLOBE NEWSWIRE -- Amalgamated Bank Nasdaq: AMAL Amalgamated today announced financial results for the second quarter ended June 30, 2020. Second Quarter 2020 Highlights Net income of 10.4 million, or 0.33 per diluted share, compared to 9.5 million, or 0.30 per diluted share, for the second quarter of 2019 Core net income non-GAAP1 of 10.6 million, or 0.34 per diluted share, compared to 9.2 million, or 0.29 per diluted share, for the second quarter of 2019 Deposit growth of 793.8 million, or 62.9 annualized, to approximately 5.9 billion compared to a balance of 5.1 billion on March 31, 2020 Loan growth of 123.0 million, or 14.1 annualized, from a balance of 3.5 billion on March 31, 2020 PACE assessment growth of 68.1 million, or 106.7 annualized, from a balance of 255.3 million on March 31, 2020 Cost of deposits was 0.20, compared to 0.33 for the first quarter of 2020 and 0.34 for the second quarter of 2019 Net interest margin was 3.10, compared to 3.46 for the first quarter of 2020 and 3.66 for the second quarter of 2019 Common Equity Tier 1, Total Risk-Based, and Tier 1 Leverage capital ratios were 12.29, 13.54, and 7.69, respectively, at June 30, 2020 Total nonperforming assets were 74.3 million or 1.15 of total assets as of June 30, 2020, compared to 65.6 million or 1.14 of total assets at March 31, 2020 and 73.9 million, or 1.50 of total assets at June 30, 2019Keith Mestrich, President and Chief Executive Officer of Amalgamated Bank, commented, For almost 100 years, Amalgamated Bank has stood with companies, organizations and individuals that have led the charge to make a more just and sustainable world. Social responsibility is embedded in Amalgamateds history, policies, products, programs, operations and culture. Now more than ever, we need to act boldly in addressing the racism embedded in our society, including the private sector. As a result, and after long conversations both inside and outside of the Bank, we have outlined a series of near-term commitments and actions intended to drive tangible results over time. It will take time to drive meaningful change and we are committed to keeping this at the forefront of our work.Mr. Mestrich, continued, We have always believed that a Bank can do good in the world while also delivering profitable growth. Our second quarter results not only validate this view but further emphasize the value that we provide to our core customer base as can be seen in our average deposit growth of 606 million during the quarter, or 50.5 on an annualized basis. Additionally, we have nearly doubled our West Coast deposits since acquiring New Resource two years ago. On the asset side of the balance sheet, we continue to grow our PACE portfolio, having effectively added 68 million in PACE securities during the quarter. While the pandemic has negatively affected the cities where we have physical locations, our customer base has a geographic diversity that, along with our conservative underwriting, should benefit the performance of our loan portfolio. Lastly, the pandemic has allowed the Bank to benefit from higher levels of digital adoption, effectively obliging our customers to utilize our technology when the ability for in-person banking was not an option. This successful transition to online banking allowed us to close several of the Banks branches earlier than anticipated. We expect to realize a one-time, non-core expense increase of approximately 6 million in the third quarter as we exit the branches, however, moving forward, beginning in 2021, our non-interest expense is expected to benefit by approximately 4 million annually.___1 Reconciliations of non-GAAP financial measures to the most comparable GAAP measure are set forth on the last two pages of the financial information accompanying this press release and may also be found on our website, UpdateAmalgamateds primary concern during the COVID-19 pandemic is for the health and wellbeing of the Companys employees, customers, and communities. Our employees continue to manage from a work from home environment, and our operations continue to perform well, effectively transitioning many customers to our digital platform, allowing for further consolidation of our branch network.We have offered payment deferrals as an option for our consumer and commercial borrowers who are experiencing financial stress as a result of COVID-19 impacts. As of the week ending July 25, 2020, we have provided payment deferrals on the following amount of loan balances. Total LoansDeferrals as of: of Exited 630207252062020Portfolio Deferral Multifamily9721782181839 CRE Construction4691111222412 CI61839396- Residential1,43390122633 Consumer Student188101161 Total3,6804285121284 Results of Operations, Quarter Ended June 30, 2020 Net income for the second quarter of 2020 was 10.4 million, or 0.33 per diluted share, compared to 9.5 million, or 0.30 per diluted share, for the first quarter of 2020 and 11.2 million, or 0.35 per diluted share, for the second quarter of 2019. The 0.8 million decrease in net income for the second quarter of 2020, compared to the second quarter of 2019, was primarily due to a 6.1 million increase in provision for loan losses, partially offset by a 2.6 million increase in net interest income and a 2.3 million increase in non-interest income.Core net income non-GAAP for the second quarter of 2020 was 10.6 million, or 0.34 per diluted share, compared to 9.2 million, or 0.29 per diluted share, for the first quarter of 2020 and 11.6 million, or 0.36 per diluted share, for the second quarter of 2019. Core net income for the second quarter of 2020 excludes 0.5 million of non-interest income gains on the sale of securities, 0.7 million in expense related to the closure of six branches, and other adjustments, including the tax effect of such adjustments.Net interest income was 44.4 million for the second quarter of 2020, compared to 44.7 million for the first quarter of 2020 and 41.9 million for the second quarter of 2019. The 2.5 million year-over-year increase was primarily attributable to a decrease in interest expense due to a decrease in borrowings and deposit rate paid, and an increase in average securities and loans of 509.5 million and 383.9 million, respectively with lower yields. These impacts were partially offset by an increase in average interest-bearing deposits of 340.4 million.Net interest margin was 3.10 for the second quarter of 2020, a decrease of 36 basis points from 3.46 in the first quarter of 2020, and a decrease of 56 basis points from 3.66 in the second quarter of 2019. The accretion of the loan mark from the loans we acquired in our New Resource Bank acquisition contributed three basis points to our net interest margin in the second quarter of 2020, compared to four and six basis points in the first quarter of 2020 and the second quarter of 2019, respectively. Prepayment penalties earned through loan income contributed 0.2 million, or two basis points, to our net interest margin in the second quarter of 2020, compared to six and three basis points in the first quarter of 2020 and the second quarter of 2019, respectively.Provisions for loan loss expense totaled 8.2 million in the second quarter of 2020 compared to 8.6 million in the first quarter of 2020 and 2.1 million for the second quarter of 2019. The provision expense in the second quarter of 2020 was primarily driven by a 3.2 million increase in allowance related to payment deferrals in our loan portfolio, a 2.7 million increase in specific reserves related to one hotel which was downgraded to non-accrual, and 1.5 million related to downgrades to the risk rating of loans, primarily construction loans.Non-interest income was 8.7 million in the second quarter of 2020 compared to 9.1 million in the first quarter of 2020, and 6.3 million in the second quarter of 2019. The 2.3 million increase in the second quarter of 2020, compared to the like period in 2019, was primarily due to 1.3 million tax credit on an equity investment in a solar project, a 0.5 million gain on the sale of securities compared to a loss of 0.4 million in the comparable quarter of 2019, and a 0.7 million increase in Bank-owned life insurance income due to the receipt of a death benefit payout. These increases were partially offset by a 0.5 million decrease in Trust Department fees primarily related to the decrease in revenue from a real estate fund which is liquidating assets.Non-interest expense was 31.1 million in the second quarter of 2020 compared to 32.3 million in the first quarter of 2020, and 31.0 million in the second quarter of 2019. Expenses in the second quarter of 2020 were relatively unchanged compared to the same period in 2019. The 1.2 million decrease in the second quarter of 2020 compared to the linked quarter was primarily due to a 1.3 million decrease in branch closure expense in occupancy and depreciation and a 1.0 million decrease in professional fees from external audit, subadvisors and consultants. These decreases were partially offset by an increase in data processing and other expenses of 0.7 million and 0.5 million, respectively.Our provision for income tax expense was 3.4 million for the second quarter of 2020, compared to a provision of 3.4 million for the first quarter of 2020 and a provision of 3.9 million for the second quarter of 2019. Our effective tax rate for the second quarter of 2020 was 24.9, compared to 26.3 for the first quarter of 2020 and 25.8 for the second quarter of 2019. 