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Provident Financial Services, Inc. Reports Second Quarter Earnings

ISELIN, N.J., July 24, 2025 (GLOBE NEWSWIRE) -- Provident Financial Services, Inc. (NYSE:PFS) (the “Company”) reported net income of $72.0 million, or $0.55 per basic and diluted share for the three months ended June 30, 2025, compared to $64.0 million, or $0.49 per basic and diluted share, for the three months ended March 31, 2025 and a net loss of $11.5 million, or $(0.11) per basic and diluted share, for the three months ended June 30, 2024. For the six months ended June 30, 2025, net income totaled $136.0 million, or $1.04 per basic and diluted share, compared to $20.6 million, or $0.23 per basic and diluted share, for the six months ended June 30, 2024. While there were no transaction costs related to our merger with Lakeland Bancorp, Inc. (“Lakeland”) for the 2025 period, these costs totaled $79.0 million and $81.2 million, including an initial Current Expected Credit Loss ("CECL") provision for credit losses recorded as part of the Lakeland merger, for the three and six months ended June 30, 2024, respectively.

Anthony J. Labozzetta, President and Chief Executive Officer commented, “Provident's performance this quarter was impressive and I am very proud of the team's continued hard work and dedication to excellence. We achieved record revenues by growing earning assets and expanding margins, while improving operational efficiency and maintaining strong asset quality. We look forward to sustaining our positive momentum and continuing to grow our business.”

Performance Highlights for the Second Quarter of 2025

  • Adjusted for a one-time write-down on a foreclosed property in the prior quarter, the Company's annualized adjusted returns on average assets, average equity and average tangible equity(1) were 1.19%, 10.76% and 16.79% for the quarter ended June 30, 2025, compared to 1.11%, 10.13% and 16.15% for the quarter ended March 31, 2025. A reconciliation between GAAP and the above non-GAAP ratios is shown on page 12 of the earnings release.
  • The Company's annualized adjusted pre-tax, pre-provision returns on average assets, average equity and average tangible equity(2) were 1.64%, 14.88% and 21.26% for the quarter ended June 30, 2025, compared to 1.61%, 14.63% and 21.18% for the quarter ended March 31, 2025. A reconciliation between GAAP and the above non-GAAP ratios is shown on page 12 of the earnings release.
  • The Company reported record revenue of $214.2 million for the quarter ended June 30, 2025, comprised of record net interest income of $187.1 million and non-interest income of $27.1 million.
  • Average interest-earning assets increased $383.8 million, or an annualized 7.0%, for the quarter ended June 30, 2025, versus the trailing quarter.
  • The Company’s commercial and industrial ("C&I") loan portfolio, excluding mortgage warehouse lines, increased $182.7 million, or 16.26% annualized, to $4.69 billion as of June 30, 2025, from $4.51 billion as of March 31, 2025. Additionally, the Company's total commercial loan portfolio, including mortgage warehouse lines, commercial mortgage, multi-family and construction loans, increased $319.3 million, or 7.98% annualized, to $16.51 billion as of June 30, 2025, from $16.19 billion as of March 31, 2025.
  • As of June 30, 2025, the Company's loan pipeline, consisting of work-in-process and loans approved pending closing, totaled $2.59 billion, with a weighted average interest rate of 6.30%, compared to $2.77 billion, with a weighted average interest rate of 6.31%, as of March 31, 2025.
  • The net interest margin increased two basis points to 3.36% for the quarter ended June 30, 2025, from 3.34% for the trailing quarter, while the core net interest margin, which excludes the impact of purchase accounting accretion and amortization, decreased one basis point from the trailing quarter to 2.93%. The weighted average yield on interest-earning assets for the quarter ended June 30, 2025 increased five basis points to 5.68%, compared to the trailing quarter, while the weighted average cost of interest-bearing liabilities for the quarter ended June 30, 2025 increased four basis points to 2.94%, compared to the trailing quarter.
  • The Company recorded a $2.7 million benefit to the provision for credit losses on loans for the quarter ended June 30, 2025, compared to a $325,000 provision for the trailing quarter. Non-performing assets to total assets improved to 0.44% as of June 30, 2025, and annualized net charge-offs were 0.03% of loans for the quarter. The allowance for credit losses as a percentage of loans decreased to 0.98% as of June 30, 2025, from 1.02% as of March 31, 2025.
  • Tangible book value per share (3) increased 3.2% to $14.60 and our tangible common equity ratio increased 13 basis points to 8.03% as of June 30, 2025. A reconciliation between GAAP and the above non-GAAP ratios is shown on page 13 of the earnings release.

Results of Operations

Three months ended June 30, 2025 compared to the three months ended March 31, 2025

For the three months ended June 30, 2025, the Company reported net income of $72.0 million, or $0.55 per basic and diluted share, compared to net income of $64.0 million, or $0.49 per basic and diluted share, for the three months ended March 31, 2025.

Net Interest Income and Net Interest Margin

Net interest income increased $5.4 million to $187.1 million for the three months ended June 30, 2025, from $181.7 million for the trailing quarter. The increase in net interest income was primarily due to originations of new loans at current market rates and the favorable repricing of adjustable rate loans, partially offset by a decrease in average lower-costing deposits and an increase in average borrowings.

The Company’s net interest margin increased two basis points to 3.36% for the quarter ended June 30, 2025, from 3.34% for the trailing quarter. The weighted average yield on interest-earning assets for the quarter ended June 30, 2025 increased five basis points to 5.68%, compared to the trailing quarter. The weighted average cost of interest-bearing liabilities for the quarter ended June 30, 2025 increased four basis points from the trailing quarter, to 2.94%. The average cost of interest-bearing deposits for the quarter ended June 30, 2025 decreased two basis points to 2.62%, compared to 2.64% for the trailing quarter. The average cost of total deposits, including non-interest-bearing deposits, was 2.10% for the quarter ended June 30, 2025, compared to 2.11% for the trailing quarter. The average cost of borrowed funds for the quarter ended June 30, 2025 was 3.94%, compared to 3.76% for the quarter ended March 31, 2025.

Provision for Credit Losses on Loans

For the quarter ended June 30, 2025, the Company recorded a $2.7 million benefit to the provision for credit losses on loans, compared with a provision for credit losses on loans of $325,000 for the quarter ended March 31, 2025. The benefit to the provision for credit losses on loans in the quarter was primarily attributable to an improved economic forecast and an overall improvement in the Company's asset quality, partially offset by an increase in specific reserves required on individually analyzed loans. For the three months ended June 30, 2025, net charge-offs totaled $1.2 million, or an annualized three basis points of average loans, compared with net charge-offs of $2.0 million, or an annualized four basis points of average loans for the trailing quarter.

Non-Interest Income and Expense

For the three months ended June 30, 2025, non-interest income totaled $27.1 million, an increase of $45,000, compared to the trailing quarter. Fee income increased $1.1 million to $10.7 million for the three months ended June 30, 2025, compared to the trailing quarter, primarily due to increases in deposit related and loan prepayment fee income, combined with an increase in non-deposit investment fee income. BOLI income increased $493,000 for the three months ended June 30, 2025, compared to the trailing quarter, primarily due to greater equity valuations and an increase in benefit claims recognized. Partially offsetting these increases in non-interest income, insurance agency income decreased $709,000 to $4.9 million for the three months ended June 30, 2025, compared to the trailing quarter, mainly due to the receipt of contingent commissions in the prior quarter, partially offset by additional business activity in the current quarter. Wealth management income decreased $380,000 to $6.9 million for the three months ended June 30, 2025, compared to the trailing quarter, mainly due to a decrease in the average market value of assets under management during the period. Additionally, other income decreased $353,000 to $1.9 million for the three months ended June 30, 2025, compared to the trailing quarter, primarily due to a decrease in profit on fixed asset sales.

Non-interest expense totaled $114.6 million for the three months ended June 30, 2025, a decrease of $1.7 million, compared to $116.3 million for the trailing quarter. Other operating expenses decreased $1.9 million to $14.5 million for the three months ended June 30, 2025, compared to $16.4 million for the trailing quarter, primarily due to a prior quarter $2.7 million write-down on a foreclosed property, while net occupancy expense decreased $916,000 to $13.0 million for the three months ended June 30, 2025, compared to $13.9 million for the trailing quarter, primarily due to decreases in snow removal, utilities and other maintenance costs. Partially offsetting these decreases in non-interest expense, compensation and benefits expense increased $883,000 to $63.2 million for the three months ended June 30, 2025, compared to $62.4 million for the trailing quarter. The increase in compensation and benefits expense was primarily attributable to an increase in salary expense, primarily due to additional business days in the current quarter compared to the trailing quarter.

The Company’s annualized adjusted non-interest expense as a percentage of average assets(5) totaled 1.89% for the quarter ended June 30, 2025, compared to 1.92% for the trailing quarter. The efficiency ratio (adjusted non-interest expense divided by the sum of net interest income and non-interest income)(6) improved to 53.52% for the three months ended June 30, 2025, compared to 54.43% for the trailing quarter.

Income Tax Expense

For the three months ended June 30, 2025, the Company's income tax expense was $30.5 million with an effective tax rate of 29.7%, compared to income tax expense of $27.8 million with an effective tax rate of 30.3%, for the trailing quarter. The increase in tax expense for the three months ended June 30, 2025 compared with the trailing quarter was largely due to an increase in taxable income in the current quarter, while the decrease in tax rate was primarily due to a discrete item related to stock-based compensation in the prior quarter.

Three months ended June 30, 2025 compared to the three months ended June 30, 2024

For the three months ended June 30, 2025, the Company reported net income of $72.0 million, or $0.55 per basic and diluted share, compared to a net loss of $11.5 million, or $(0.11) per basic and diluted share, for the three months ended June 30, 2024. While there were no transaction costs related to our merger with Lakeland for the 2025 period, these costs totaled $79.0 million, including an initial CECL provision for credit losses recorded as part of the Lakeland merger, for the three months ended June 30, 2024.

Net Interest Income and Net Interest Margin

Net interest income increased $45.6 million to $187.1 million for the three months ended June 30, 2025, from $141.5 million for same period in 2024. The increase in net interest income was largely driven by growth in average earning assets and net assets added in the May 16, 2024 acquisition of Lakeland and related accretion of purchase accounting adjustments.

The Company’s net interest margin increased 15 basis points to 3.36% for the quarter ended June 30, 2025, from 3.21% for the same period last year. The weighted average yield on interest-earning assets for the quarter ended June 30, 2025 increased one basis point to 5.68%, compared to 5.67% for the quarter ended June 30, 2024. The weighted average cost of interest-bearing liabilities decreased 15 basis points for the quarter ended June 30, 2025 to 2.94%, compared to 3.09% for the second quarter of 2024. The average cost of interest-bearing deposits for the quarter ended June 30, 2025 was 2.62%, compared to 2.84% for the same period last year. Average non-interest-bearing demand deposits increased $833.2 million to $3.70 billion for the quarter ended June 30, 2025, compared to $2.87 billion for the quarter ended June 30, 2024. The average cost of total deposits, including non-interest-bearing deposits, was 2.10% for the quarter ended June 30, 2025, compared with 2.24% for the quarter ended June 30, 2024. The average cost of borrowed funds for the quarter ended June 30, 2025 was 3.94%, compared to 3.83% for the same period last year.

Provision for Credit Losses on Loans

For the quarter ended June 30, 2025, the Company recorded a $2.7 million benefit to the provision for credit losses on loans, compared with a $66.1 million provision for credit losses on loans for the quarter ended June 30, 2024. The benefit to the provision for credit losses on loans in the quarter was primarily attributable to an improved economic forecast and an overall improvement in the Company's asset quality, partially offset by an increase in specific reserves required on individually analyzed loans. The provision for credit losses on loans for the prior year quarter was primarily attributable to an initial CECL provision for credit losses of $60.1 million, recorded as part of the Lakeland merger. For the three months ended June 30, 2025, net charge-offs totaled $1.2 million, or an annualized three basis points of average loans, compared with net charge-offs of $2.7 million, or an annualized seven basis points of average loans, for the same period last year.

Non-Interest Income and Expense

Non-interest income totaled $27.1 million for the quarter ended June 30, 2025, an increase of $4.8 million, compared to the same period in 2024. Net gain on securities transactions increased $3.0 million for the three months ended June 30, 2025, compared to the same period in 2024, primarily due to a prior year $2.8 million loss on the sale of subordinated debt issued by Lakeland from the Provident investment portfolio prior to the merger. Fee income increased $2.0 million to $10.7 million for the three months ended June 30, 2025, compared to the prior year quarter, primarily due to increases in deposit fee income, debit card related fee income and loan related fee income, resulting from the Lakeland merger. Additionally, other income increased $895,000 to $1.9 million for the three months ended June 30, 2025, compared to the quarter ended June 30, 2024, primarily due to increases in gains on the sale of SBA loans, while insurance agency income increased $454,000 to $4.9 million for the three months ended June 30, 2025, compared to the quarter ended June 30, 2024, largely due to an increase in business activity. Partially offsetting these increases to non-interest income, wealth management fees decreased $821,000 to $6.9 million for the three months ended June 30, 2025, compared to the quarter ended June 30, 2024, mainly due to a decrease in the average market value of assets under management during the period, while BOLI income decreased $738,000 to $2.6 million for the three months ended June 30, 2025, compared to the prior year quarter, primarily due to a decrease in benefit claims recognized.

For the three months ended June 30, 2025, non-interest expense totaled $114.6 million, a decrease of $780,000, compared to the three months ended June 30, 2024. Merger-related expenses decreased $18.9 million for the three months ended June 30, 2025, compared to the same period in 2024. Partially offsetting the decrease in merger-related expenses, compensation and benefits expense increased $8.4 million to $63.2 million for the three months ended June 30, 2025, compared to $54.9 million for the same period in 2024, primarily attributable to the addition of Lakeland personnel. Other operating expenses increased $3.2 million to $14.5 million for the three months ended June 30, 2025, compared to $11.3 million for the same period in 2024, primarily due to the addition of Lakeland. Amortization of intangibles increased $3.0 million to $9.5 million for the three months ended June 30, 2025, compared to $6.5 million for the same period in 2024, largely due to core deposit intangible amortization related to Lakeland. Net occupancy expense increased $1.9 million to $13.0 million for three months ended June 30, 2025, compared to $11.1 million for the same period in 2024, primarily due to an increase in depreciation and maintenance expenses due to the addition of Lakeland. Data processing expenses increased $1.2 million to $9.6 million for three months ended June 30, 2025, compared to $8.4 million for the same period in 2024, primarily due to the addition of Lakeland.

The Company’s annualized adjusted non-interest expense as a percentage of average assets(5) was 1.89% for the quarter ended June 30, 2025, compared to 2.02% for the same period in 2024. The efficiency ratio (adjusted non-interest expense divided by the sum of net interest income and non-interest income)(6) was 53.52% for the three months ended June 30, 2025 compared to 57.86% for the same respective period in 2024.

Income Tax Expense

For the three months ended June 30, 2025, the Company's income tax expense was $30.5 million with an effective tax rate of 29.7%, compared with an income tax benefit of $9.8 million for the three months ended June 30, 2024. The increase in tax expense for the three months ended June 30, 2025, compared with the same period last year was largely due to an increase in taxable income in the quarter. The prior year income tax benefit was largely due to a $5.3 million tax benefit related to the revaluation of deferred tax assets to reflect the imposition by the state of New Jersey of a 2.5% Corporate Transit Fee in the quarter, effective January 1, 2024, combined with a decrease in taxable income in the prior year quarter as a result of additional expenses from the Lakeland merger.

Six months ended June 30, 2025 compared to the six months ended June 30, 2024

For the six months ended June 30, 2025, net income totaled $136.0 million, or $1.04 per basic and diluted share, compared to net income of $20.6 million, or $0.23 per basic and diluted share, for the six months ended June 30, 2024. While there were no transaction costs related to our merger with Lakeland for the 2025 period, those costs totaled $81.2 million, including an initial CECL provision for credit losses recorded as part of the Lakeland merger, for the six months ended June 30, 2024.

Net Interest Income and Net Interest Margin

Net interest income increased $133.6 million to $368.8 million for the six months ended June 30, 2025, from $235.2 million for same period in 2024. Net interest income for the six months ended June 30, 2025 was largely driven by growth in average earning assets and net assets added in the May 16, 2024 acquisition of Lakeland and related accretion of purchase accounting adjustments.

For the six months ended June 30, 2025, the net interest margin increased 27 basis points to 3.35%, compared to 3.08% for the six months ended June 30, 2024. The weighted average yield on interest earning assets increased 22 basis points to 5.65% for the six months ended June 30, 2025, compared to 5.43% for the six months ended June 30, 2024, while the weighted average cost of interest-bearing liabilities decreased five basis points to 2.92% for the six months ended June 30, 2025, compared to 2.97% for the same period last year. The average cost of interest-bearing deposits decreased 11 basis points to 2.63% for the six months ended June 30, 2025, compared to 2.74% for the same period last year. Average non-interest-bearing demand deposits increased $1.24 billion to $3.71 billion for the six months ended June 30, 2025, compared with $2.47 billion for the six months ended June 30, 2024. The average cost of total deposits, including non-interest-bearing deposits, was 2.10% for the six months ended June 30, 2025, compared with 2.19% for the six months ended June 30, 2024. The average cost of borrowings for the six months ended June 30, 2025 was 3.86%, compared to 3.75% for the same period last year.

Provision for Credit Losses on Loans

For the six months ended June 30, 2025, the Company recorded a $2.3 million benefit to the provision for credit losses on loans, compared with a provision for credit losses on loans of $66.3 million for the six months ended June 30, 2024. The benefit to the provision for credit losses on loans for the six months ended June 30, 2025 was primarily attributable to an improved economic forecast and an overall improvement in the Company's asset quality, partially offset by an increase in specific reserves required on individually analyzed loans. The provision for credit losses on loans for the prior year period was primarily attributable to an initial CECL provision for credit losses of $60.1 million, recorded as part of the Lakeland merger in accordance with GAAP requirements for accounting for business combinations. For the six months ended June 30, 2025, net charge-offs totaled $3.2 million or an annualized three basis points of average loans, compared with net charge-offs of $4.6 million, or an annualized four basis points of average loans, for the six months ended June 30, 2024.

Non-Interest Income and Expense

For the six months ended June 30, 2025, non-interest income totaled $54.1 million, an increase of $11.0 million compared to the same period in 2024. Fee income increased $5.8 million to $20.4 million for the six months ended June 30, 2025, compared to the same period in 2024, primarily due to increases in deposit fee income, debit and credit card related fee income and loan related fee income resulting from the Lakeland merger. Net gains on securities transactions increased $3.1 million for the six months ended June 30, 2025, primarily due to a prior year $2.8 million loss on the sale of subordinated debt issued by Lakeland from the Provident investment portfolio prior to the merger. Other income increased $2.3 million to $4.1 million for the six months ended June 30, 2025, compared to $1.8 million for the same period in 2024, primarily due to an increase in gains on sales of SBA and mortgage loans. Additionally, insurance agency income increased $1.3 million to $10.6 million for the six months ended June 30, 2025, compared to $9.3 million for the same period in 2024, largely due to increases in contingent commissions, retention revenue and new business activity. Partially offsetting these increases in non-interest income, wealth management income decreased $982,000 to $14.3 million for the six months ended June 30, 2025, compared to the same period in 2024, mainly due to a decrease in the average market value of assets under management during the period, while BOLI income decreased $462,000 to $4.7 million for the six months ended June 30, 2025, compared to the same period in 2024, primarily due to a decrease in benefit claims recognized, combined with lower equity valuations.

Non-interest expense totaled $230.9 million for the six months ended June 30, 2025, an increase of $43.7 million, compared to $187.2 million for the six months ended June 30, 2024. Compensation and benefits expense increased $30.7 million to $125.6 million for the six months ended June 30, 2025, compared to $94.9 million for the six months ended June 30, 2024, primarily attributable to the addition of Lakeland personnel. Amortization of intangibles increased $11.8 million to $19.0 million for the six months ended June 30, 2025, compared to $7.2 million for the six months ended June 30, 2024, largely due to core deposit intangible amortization related to Lakeland. Other operating expenses increased $9.3 million to $30.9 million for the three months ended June 30, 2025, compared to $21.6 million for the same period in 2024, primarily due to a $2.7 million write-down on a foreclosed property, combined with the addition of Lakeland. Net occupancy expense increased $7.3 million to $26.9 million for the six months ended June 30, 2025, compared to the same period in 2024, primarily due to increases in depreciation and maintenance expense related to the addition of Lakeland. Data processing expense increased $4.0 million to $19.2 million for the six months ended June 30, 2025, compared to $15.2 million for the six months ended June 30, 2024, primarily due to the addition of Lakeland, while FDIC insurance increased $1.4 million to $6.7 million for the six months ended June 30, 2025, primarily due to the addition of Lakeland. Partially offsetting these increases to non-interest expense, merger-related expenses decreased $21.1 million for the six months ended June 30, 2025.

Income Tax Expense

For the six months ended June 30, 2025, the Company's income tax expense was $58.3 million with an effective tax rate of 30.0%, compared with income tax expense of $1.1 million for the six months ended June 30, 2024. The increase in tax expense for the six months ended June 30, 2025 compared with the same period last year was largely due to an increase in taxable income, combined with a prior year $5.3 million tax benefit related to the revaluation of deferred tax assets to reflect the imposition by the State of New Jersey of a 2.5% Corporate Transit Fee, effective January 1, 2024. The prior year income tax expense was favorably impacted by the Lakeland merger.

Asset Quality

The Company’s total non-performing loans as of June 30, 2025 were $107.2 million, or 0.56% of total loans held for investment, compared to $103.2 million, or 0.54% of total loans as of March 31, 2025 and $72.1 million, or 0.37% of total loans as of December 31, 2024. The $3.9 million increase in non-performing loans as of June 30, 2025, compared to the trailing quarter, consisted of a $3.1 million increase in non-performing commercial loans, a $2.0 million increase in non-performing residential mortgage loans and a $195,000 increase in non-performing consumer loans, partially offset by a $1.2 million decrease in non-performing multi-family loans, a $103,000 decrease in non-performing commercial mortgage loans and a $28,000 decrease in non-performing construction loans. As of June 30, 2025, impaired loans totaled $92.7 million with related specific reserves of $11.4 million, compared with impaired loans totaling $86.1 million with related specific reserves of $7.9 million as of March 31, 2025. As of December 31, 2024, impaired loans totaled $55.4 million with related specific reserves of $7.5 million.

As of June 30, 2025, the Company’s allowance for credit losses related to the loan portfolio was 0.98% of total loans, compared to 1.02% and 1.04% as of March 31, 2025 and December 31, 2024, respectively. The allowance for credit losses decreased $5.6 million to $187.9 million as of June 30, 2025, from $193.4 million as of December 31, 2024. The decrease in the allowance for credit losses on loans as of June 30, 2025 compared to December 31, 2024 was due to a $2.3 million benefit to the provision for credit losses on loans, combined with net charge-offs of $3.2 million.

The following table sets forth accruing past due loans and non-accrual loans held for investment on the dates indicated, as well as delinquency statistics and certain asset quality ratios.

 
    June 30, 2025   March 31, 2025   December 31, 2024
    Number
of
Loans
  Principal
Balance
of Loans
  Number
of
Loans
  Principal
Balance
of Loans
  Number
of
Loans
  Principal
Balance
of Loans
    (Dollars in thousands)
Accruing past due loans:                        
30 to 59 days past due:                        
Commercial mortgage loans   1   $ 129     8   $ 13,696     7   $ 8,538  
Multi-family mortgage loans           1     7,433          
Construction loans                        
Residential mortgage loans   20     5,541     27     6,905     22     6,388  
Total mortgage loans   21     5,670     36     28,034     29     14,926  
Commercial loans   4     997     23     11,372     9     3,026  
Consumer loans   30     1,592     22     1,604     47     3,152  
Total 30 to 59 days past due   55   $ 8,259     95   $ 42,060     85   $ 21,104  
                         
60 to 89 days past due:                        
Commercial mortgage loans   1   $ 347     2   $ 196     4   $ 3,954  
Multi-family mortgage loans   1     431                  
Construction loans                        
Residential mortgage loans   16     3,816     18     5,009     17     5,049  
Total mortgage loans   18     4,594     20     5,205     21     9,003  
Commercial loans   13     4,389     8     1,955     3     1,117  
Consumer loans   9     699     12     854     15     856  
Total 60 to 89 days past due   40     9,682     47     8,908     39     10,976  
Total accruing past due loans   95   $ 17,941     142   $ 50,968     124   $ 32,080  
                         
Non-accrual:                        
Commercial mortgage loans   15   $ 42,828     18   $ 42,931     17   $ 20,883  
Multi-family mortgage loans   3     6,143     5     7,294     6     7,498  
Construction loans   3     18,901     3     18,929     2     13,246  
Residential mortgage loans   25     7,209     22     5,246     23     4,535  
Total mortgage loans   46     75,081     48     74,400     48     46,162  
Commercial loans   34     30,531     32     23,580     32     21,892  
Consumer loans   21     1,547     19     1,352     23     1,656  
Total non-accrual loans   101   $ 107,159     99   $ 99,332     103   $ 69,710  
                         
Non-performing loans to total loans held for investment         0.56 %         0.53 %         0.37 %
Allowance for loan losses to total non-performing loans         175.32 %         185.78 %         268.43 %
Allowance for loan losses to total loans held for investment         0.98 %         1.02 %         1.04 %
                                     

There were no non-accrual or past due loans held for sale as of June 30. 2025. As of March 31, 2025 and December 31, 2024, total non-accrual loans held for sale, which are not in the tables above, totaled $3.9 million and $2.4 million, respectively. Additionally, as of March 31, 2025 and December 31, 2024, total past due loans held for sale, including non-accrual loans held for sale, totaled $5.8 million and $4.8 million, respectively.

As of June 30, 2025 and December 31, 2024, the Company held foreclosed assets of $1.0 million and $9.5 million, respectively. During the six months ended June 30, 2025, there was a write-down of one foreclosed commercial property of $2.7 million based on a contracted sales price. The sale of this property closed in the second quarter of 2025, which reduced foreclosed assets by an additional $5.8 million. Foreclosed assets as of June 30, 2025 were comprised of one commercial property. Total non-performing assets as of June 30, 2025 increased $26.6 million to $108.1 million, or 0.44% of total assets, from $81.5 million, or 0.34% of total assets at December 31, 2024.

Balance Sheet Summary

Total assets as of June 30, 2025 were $24.55 billion, a $495.5 million increase from December 31, 2024. The increase in total assets was primarily due to a $445.5 million increase in loans held for investment and a $246.5 million increase in total investments, partially offset by a $155.5 million decrease in loans held for sale, and decreases in intangibles and other assets.

The Company’s loans held for investment portfolio totaled $19.10 billion as of June 30, 2025 and $18.66 billion as of December 31, 2024. The loan portfolio consisted of the following:

           
  June 30, 2025   March 31, 2025   December 31, 2024
  (Dollars in thousands)
Mortgage loans:          
Commercial $ 7,313,904     $ 7,295,651     $ 7,228,078  
Multi-family   3,517,509       3,458,190       3,382,933  
Construction   751,914       756,356       823,503  
Residential   1,985,355       1,994,404       2,010,637  
Total mortgage loans   13,568,682       13,504,601       13,445,151  
Commercial loans   4,688,888       4,506,215       4,447,672  
Mortgage warehouse lines   240,134       176,687       160,928  
Consumer loans   617,190       613,453       613,819  
Total gross loans   19,114,894       18,800,956       18,667,570  
Premiums on purchased loans   1,308       1,337       1,338  
Net deferred fees and unearned discounts   (11,372 )     (10,922 )     (9,538 )
Total loans $ 19,104,830     $ 18,791,371     $ 18,659,370  
                       

During the three months ended June 30, 2025, the loans held for investment portfolio had net increases of $182.7 million of commercial loans, $63.4 million of mortgage warehouse lines, $59.3 million of multi-family loans and $18.3 million of commercial mortgage loans, partially offset by net decreases of $9.0 million of residential mortgage loans, $4.4 million of construction loans and $3.7 million of consumer loans. Total commercial loans, including mortgage warehouse lines, commercial mortgage, multi-family and construction loans, represented 86.4% of the loan portfolio as of June 30, 2025, compared to 85.9% as of December 31, 2024.

For the six months ended June 30, 2025, loan funding, including advances on lines of credit, totaled $4.30 billion, compared with $2.53 billion for the same period in 2024.

As of June 30, 2025, the Company’s unfunded loan commitments totaled $3.74 billion, including commitments of $2.30 billion in commercial loans, $511.9 million in construction loans and $212.7 million in commercial mortgage loans. Unfunded loan commitments as of December 31, 2024 and June 30, 2024 were $2.73 billion and $3.01 billion, respectively.

The loan pipeline, consisting of work-in-process and loans approved pending closing, totaled $2.59 billion as of June 30, 2025, compared to $1.79 billion and $1.67 billion as of December 31, 2024 and June 30, 2024, respectively.

Total investment securities were $3.47 billion as of June 30, 2025, a $246.5 million increase from December 31, 2024. This increase was primarily due to purchases of mortgage-backed securities and a decrease in unrealized losses on available for sale debt securities.

Total deposits increased $84.7 million during the six months ended June 30, 2025, to $18.71 billion. Total time deposits increased $99.3 million to $3.27 billion as of June 30, 2025, while total savings and demand deposit accounts decreased $14.6 million to $15.44 billion as of June 30, 2025. The increase in time deposits consisted of a $108.1 million increase in brokered time deposits, partially offset by an $8.8 million decrease in retail time deposits. The decrease in savings and demand deposits was largely attributable to a $50.7 million decrease in savings deposits and a $36.8 million decrease in non-interest bearing demand deposits, partially offset by a $52.2 million increase in money market deposits and a $20.7 million increase in interest bearing demand deposits.

Borrowed funds increased $354.2 million during the six months ended June 30, 2025, to $2.37 billion. Borrowed funds represented 9.7% of total assets as of June 30, 2025, an increase from 8.4% as of December 31, 2024.

Stockholders’ equity increased $106.3 million during the six months ended June 30, 2025, to $2.71 billion, primarily due to net income earned for the period and a decrease in unrealized losses on available for sale debt securities, partially offset by cash dividends paid to stockholders. For the three and six months ended June 30, 2025, common stock repurchases totaled 55,826 shares at an average cost of $17.83 per share and 156,570 shares at an average cost of $18.07 per share, respectively, all of which were made in connection with withholding to cover income taxes on the vesting of stock-based compensation. As of June 30, 2025, approximately 816,000 shares remained eligible for repurchase under the current stock repurchase authorization. Book value per share and tangible book value per share(1) as of June 30, 2025 were $20.73 and $14.60, respectively, compared with $19.93 and $13.66, respectively, as of December 31, 2024.

About the Company

Provident Financial Services, Inc. is the holding company for Provident Bank, a community-oriented bank offering "Commitment you can count on" since 1839. Provident Bank provides a comprehensive array of financial products and services through its network of branches throughout New Jersey, Bucks, Lehigh and Northampton counties in Pennsylvania, as well as Orange, Queens and Nassau Counties in New York. The Bank also provides fiduciary and wealth management services through its wholly owned subsidiary, Beacon Trust Company and insurance services through its wholly owned subsidiary, Provident Protection Plus, Inc.

Post Earnings Conference Call

Representatives of the Company will hold a conference call for investors on Thursday, July 24, 2025 at 2:00 p.m. Eastern Time to discuss the Company’s financial results for the quarter ended June 30, 2025. The call may be accessed by dialing 1-888-412-4131 (United States Toll Free) and 1-646-960-0134 (United States Local). Speakers will need to enter conference ID code (3610756) before being met by a live operator. Internet access to the call is also available (listen only) at provident.bank by going to Investor Relations and clicking on "Webcast."

A supplemental 2nd Quarter results investor presentation is also available on our investor relations website under “Presentations.”

Forward Looking Statements

Certain statements contained herein are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. 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,” "project," "intend," “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, including, but not limited to, those set forth in Item 1A of the Company's Annual Report on Form 10-K, as supplemented by its Quarterly Reports on Form 10-Q, and those related to the economic environment, particularly in the market areas in which the Company operates, inflation and unemployment, competitive products and pricing, real estate values, fiscal and monetary policies of the U.S. Government, tariffs, the effects of the recent turmoil in the banking industry, changes in accounting policies and practices that may be adopted by the regulatory agencies and the accounting standards setters, changes in government regulations affecting financial institutions, including regulatory fees and capital requirements, changes in prevailing interest rates, potential goodwill impairment, acquisitions and the integration of acquired businesses, credit risk management, asset-liability management, the financial and securities markets, the availability of and costs associated with sources of liquidity, and the impact of a potential shutdown of the federal government.

The Company cautions readers not to place undue reliance on any such forward-looking statements which speak only as of the date they are made. The Company advises 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 assume any duty, and does not undertake, to update any forward-looking statements to reflect events or circumstances after the date of this statement.

Footnotes

(1) Annualized adjusted pre-tax, pre-provision return on average assets, annualized return on average tangible equity, tangible common equity capital ratio, tangible book value per share, annualized adjusted non-interest expense as a percentage of average assets and the efficiency ratio are non-GAAP financial measures. Please refer to the Notes following the Consolidated Financial Highlights which contain the reconciliation of GAAP to non-GAAP financial measures and the associated calculations.

                   
PROVIDENT FINANCIAL SERVICES, INC. AND SUBSIDIARY
Consolidated Financial Highlights
(Dollars in Thousands, except share data) (Unaudited)
       
  At or for the
Three Months Ended
  At or for the
Six Months Ended
  June 30,   March 31,   June 30,   June 30,   June 30,
    2025       2025       2024       2025       2024  
Statement of Income                  
Net interest income $ 187,094     $ 181,728     $ 141,506     $ 368,822     $ 235,176  
Provision (benefit) charge for credit losses   (2,888 )     638       69,705       (2,250 )     69,385  
Non-interest income   27,075       27,030       22,275       54,105       43,081  
Non-interest expense   114,614       116,267       115,394       230,881       187,221  
Income (loss) before income tax expense   102,443       91,853       (21,318 )     194,296       21,651  
Net income (loss)   71,981       64,028       (11,485 )     136,009       20,596  
Diluted earnings per share $ 0.55     $ 0.49     $ (0.11 )   $ 1.04     $ 0.23  
Interest rate spread   2.74 %     2.73 %     2.58 %     2.73 %     2.46 %
Net interest margin   3.36 %     3.34 %     3.21 %     3.35 %     3.08 %
                   
Profitability                  
Annualized return on average assets   1.19 %     1.08 %     (0.24) %     1.13 %     0.25 %
Annualized adjusted return on average assets (1)   1.19 %     1.11 %     0.06 %     1.15 %     0.49 %
Annualized return on average equity   10.76 %     9.84 %     (2.17) %     10.31 %     2.17 %
Annualized adjusted return on average equity (1)   10.76 %     10.13 %     0.53 %     10.45 %     4.28 %
Annualized return on average tangible equity (4)   16.79 %     15.73 %     (3.15) %     16.27 %     3.06 %
Annualized adjusted return on average tangible equity (1)   16.79 %     16.15 %     0.001 %     16.48 %     6.27 %
Annualized adjusted non-interest expense to average assets (4)   1.89 %     1.92 %     2.02 %     1.92 %     2.01 %
Efficiency ratio (6)   53.52 %     54.43 %     57.86 %     54.60 %     59.06 %
                   
Asset Quality                  
Non-accrual loans     $ 103,224         $ 107,159     $ 67,868  
90+ and still accruing                        
Non-performing loans       103,224           107,159       67,868  
Foreclosed assets       6,755           963       11,119  
Non-performing assets       109,979           108,122       78,987  
Non-performing loans to total loans held for investment       0.53 %         0.56 %     0.36 %
Non-performing assets to total assets       0.45 %         0.44 %     0.33 %
Allowance for loan losses     $ 191,770         $ 187,871     $ 188,331  
Allowance for loan losses to total non-performing loans       185.78 %         175.32 %     277.50 %
Allowance for loan losses to total loans held for investment       1.02 %         0.98 %     1.00 %
Net loan charge-offs $ 1,249     $ 1,987     $ 2,680     $ 3,236     $ 4,622  
Annualized net loan charge-offs to average total loans   0.03 %     0.04 %     0.07 %     0.03 %     0.07 %
                   
Average Balance Sheet Data                  
Assets $ 24,349,808     $ 24,049,318     $ 19,197,041     $ 24,200,393     $ 16,645,404  
Loans, net   18,827,305       18,590,877       14,649,413       18,709,743       12,659,202  
Earning assets   22,329,230       21,946,053       17,385,819       22,138,700       15,093,217  
Core deposits   15,222,027       15,497,343       12,257,244       15,358,925       10,693,244  
Borrowings   2,490,379       1,918,069       2,158,193       2,205,805       2,049,587  
Interest-bearing liabilities   17,612,934       17,297,892       13,856,039       17,456,284       11,965,072  
Stockholders' equity   2,684,342       2,638,361       2,127,469       2,661,478       1,912,820  
Average yield on interest-earning assets   5.68 %     5.63 %     5.67 %     5.65 %     5.43 %
Average cost of interest-bearing liabilities   2.94 %     2.90 %     3.09 %     2.92 %     2.97 %
                   

Notes and Reconciliation of GAAP and Non-GAAP Financial Measures
(Dollars in Thousands, except share data)

The Company has presented the following non-GAAP (U.S. Generally Accepted Accounting Principles) financial measures because it believes that these measures provide useful and comparative information to assess trends in the Company’s results of operations and financial condition. Presentation of these non-GAAP financial measures is consistent with how the Company evaluates its performance internally and these non-GAAP financial measures are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in the Company’s industry. Investors should recognize that the Company’s presentation of these non-GAAP financial measures might not be comparable to similarly-titled measures of other companies. These non-GAAP financial measures should not be considered a substitute for GAAP basis measures and the Company strongly encourages a review of its condensed consolidated financial statements in their entirety.

                     
(1) Annualized Adjusted Return on Average Assets, Equity and Tangible Equity                    
    Three Months Ended   Six Months Ended
    June 30,   March 31,   June 30,   June 30,   June 30,
      2025       2025       2024       2025       2024  
Net Income   $ 71,981     $ 64,028     $ (11,485 )   $ 136,009     $ 20,596  
Write-down on ORE property           2,690             2,690        
Merger-related transaction costs                 18,915             21,117  
Less: income tax expense           (809 )     (4,625 )     (809 )     (4,649 )
Annualized adjusted net income   $ 71,981       65,909     $ 2,805     $ 137,890     $ 37,064  
Less: Amortization of Intangibles (net of tax)     6,639       6,642       4,532     $ 13,281.5018     $ 5,025.1308  
Annualized adjusted net income for annualized adjusted return on average tangible equity   $ 78,620     $ 72,551     $ 7,337     $ 151,171     $ 42,089  
                     
Annualized Adjusted Return on Average Assets     1.19 %     1.11 %     0.06 %     1.15 %     0.45 %
Annualized Adjusted Return on Average Equity     10.76 %     10.13 %     0.53 %     10.45 %     3.90 %
Annualized Adjusted Return on Average Tangible Equity     16.79 %     16.15 %     2.01 %     16.48 %     6.25 %
                     
(2) Annualized adjusted pre-tax, pre-provision ("PTPP") returns on average assets, average equity and average tangible equity                    
    Three Months Ended   Six Months Ended
    June 30,   March 31,   June 30,   June 30,   June 30,
      2025       2025       2024       2025       2024  
Net income (loss)   $ 71,981     $ 64,028     $ (11,485 )   $ 136,009     $ 20,596  
Adjustments to net income (loss):                    
Provision (benefit) charge for credit losses     (2,888 )     638       69,705       (2,250 )     69,385  
Write-down on ORE property         2,690              
Net loss on Lakeland bond sale                 2,839             2,839  
Merger-related transaction costs                 18,915             21,117  
Income tax expense (benefit)     30,462       27,825       (9,833 )     58,287       1,055  
PTPP income   $ 99,555     $ 95,181     $ 70,141     $ 194,736     $ 114,992  
                     
Annualized PTPP income   $ 399,314     $ 386,012     $ 282,106     $ 392,700     $ 231,248  
Average assets   $ 24,349,808     $ 24,049,318     $ 19,197,041     $ 24,200,393     $ 16,645,404  
Average equity   $ 2,684,342     $ 2,638,361     $ 2,127,469     $ 2,661,478     $ 1,912,820  
Average tangible equity   $ 1,877,923     $ 1,822,407     $ 1,468,630     $ 1,850,318     $ 1,354,553  
                     
Annualized PTPP return on average assets     1.64 %     1.61 %     1.47 %     1.62 %     1.39 %
Annualized PTPP return on average equity     14.88 %     14.63 %     13.26 %     14.75 %     12.09 %
Annualized PTPP return on average tangible equity     21.26 %     21.18 %     19.21 %     21.22 %     17.07 %
                     
         
(3) Tangible Common Equity Ratio, Book and Tangible Book Value per Share                    
            June 30,   March 31,   December 31,
              2025       2025       2024  
Total assets           $ 24,547,286     $ 24,224,759     $ 24,051,825  
Less: total intangible assets             800,232       809,725       819,230  
Total tangible assets           $ 24,547,286     $ 24,224,759     $ 24,051,825  
                     
Total stockholders' equity           $ 2,707,555     $ 2,658,794     $ 2,601,207  
Less: total intangible assets             800,232       809,725       819,230  
Total tangible stockholders' equity           $ 1,907,323     $ 1,849,069     $ 1,781,977  
                     
Tangible common equity ratio             8.03 %     7.90 %     7.67 %
Shares outstanding             130,624,243       130,661,195       130,489,493  
                     
Book value per share (total stockholders' equity/shares outstanding)           $ 20.73     $ 20.35     $ 19.93  
Tangible book value per share (total tangible stockholders' equity/shares outstanding)           $ 14.60     $ 14.15     $ 13.66  
                     
(4) Annualized Return on Average Tangible Equity                    
    Three Months Ended   Six Months Ended
    June 30,   March 31,   June 30,   June 30,   June 30,
      2025       2025       2024       2025       2024  
Total average stockholders' equity   $ 2,684,342     $ 2,638,361     $ 2,127,469     $ 2,661,478     $ 1,912,820  
Less: total average intangible assets     806,419       815,954       658,839       811,160       558,267  
Total average tangible stockholders' equity   $ 1,877,923     $ 1,822,407     $ 1,468,630     $ 1,850,318     $ 1,354,553  
                     
Net income (loss)   $ 71,981     $ 64,028     $ (11,485 )   $ 136,009     $ 20,596  
Less: Amortization of Intangibles, net of tax     6,639       6,642,149       4,532       13,282       5,025  
Total net income (loss)   $ 78,620     $ 70,670     $ (6,953 )   $ 149,291     $ 25,621  
                     
Annualized return on average tangible equity (net income/total average tangible stockholders' equity)     16.79 %     15.73 %     (1.90) %     16.27 %     3.80 %
                     
(5) Annualized Adjusted Non-Interest Expense to Average Assets                    
    Three Months Ended   Six Months Ended
    June 30,   March 31,   June 30,   June 30,   June 30,
      2025       2025       2024       2025       2024  
Reported non-interest expense   $ 114,614     $ 116,267     $ 115,394     $ 230,881     $ 187,221  
Adjustments to non-interest expense:                    
Write-down on ORE property           2,690                    
Merger-related transaction costs                 18,915             21,117  
Adjusted non-interest expense   $ 114,614     $ 113,577     $ 96,479     $ 230,881     $ 166,104  
                     
Annualized adjusted non-interest expense   $ 459,715     $ 388,036     $ 388,036     $ 465,589     $ 334,033  
                     
Average assets   $ 24,349,808     $ 24,049,318     $ 19,197,041     $ 24,200,393     $ 16,645,404  
                     
Annualized adjusted non-interest expense/average assets     1.89 %     1.92 %     2.02 %     1.92 %     2.01 %
                     
(6) Efficiency Ratio Calculation                    
    Three Months Ended   Six Months Ended
    June 30,   March 31,   June 30,   June 30,   June 30,
      2025       2025       2024       2025       2024  
Net interest income   $ 187,094     $ 181,728     $ 141,506     $ 368,822     $ 235,176  
Reported non-interest income     27,075       27,030       22,275       54,105       43,081  
Adjustments to non-interest income:                    
Net (gain) loss on securities transactions           (87 )     (2,973 )     (87 )     2,974  
Adjusted non-interest income     27,075       26,943       25,248       54,018       46,055  
Total income   $ 214,169     $ 208,671     $ 166,754     $ 422,840     $ 281,231  
                     
Adjusted non-interest expense   $ 114,614     $ 113,577     $ 96,479     $ 230,881     $ 166,104  
                     
Efficiency ratio (adjusted non-interest expense/income)     53.52 %     54.43 %     57.86 %     54.60 %     59.06 %
                                         


 
PROVIDENT FINANCIAL SERVICES, INC. AND SUBSIDIARY
Consolidated Statements of Financial Condition
June 30, 2025 (Unaudited) and December 31, 2024
(Dollars in Thousands)
       
Assets June 30, 2025   December 31, 2024
Cash and cash equivalents $ 258,925     $ 205,939  
Available for sale debt securities, at fair value   3,019,796       2,768,915  
Held to maturity debt securities, net of allowance (fair value of $20,000 as of June 30, 2025 (unaudited) and $14,000 as of December 31, 2024)   308,704       327,623  
Equity securities, at fair value   19,410       19,110  
Federal Home Loan Bank stock   127,021       112,767  
Loans held for sale   6,922       162,453  
Loans held for investment   19,104,830       18,659,370  
Less allowance for credit losses   187,871       193,432  
Net loans   18,923,881       18,628,391  
Foreclosed assets, net   963       9,473  
Banking premises and equipment, net   115,709       119,622  
Accrued interest receivable   92,714       91,160  
Intangible assets   800,232       819,230  
Bank-owned life insurance   409,949       405,893  
Other assets   469,982       543,702  
Total assets $ 24,547,286     $ 24,051,825  
       
Liabilities and Stockholders' Equity      
Deposits:      
Demand deposits $ 13,812,120     $ 13,775,991  
Savings deposits   1,628,971       1,679,667  
Certificates of deposit of $250,000 or more   842,389       789,342  
Other time deposits   2,425,044       2,378,813  
Total deposits   18,708,524       18,623,813  
Mortgage escrow deposits   50,291       42,247  
Borrowed funds   2,374,660       2,020,435  
Subordinated debentures   404,098       401,608  
Other liabilities   302,158       362,515  
Total liabilities   21,839,731       21,450,618  
       
Stockholders' equity:      
Preferred stock, $0.01 par value, 50,000,000 shares authorized, none issued          
Common stock, $0.01 par value, 200,000,000 shares authorized, 137,565,966 shares issued and 130,624,243 shares outstanding as of June 30, 2025 and 130,489,493 outstanding as of December 31, 2024   1,376       1,376  
Additional paid-in capital   1,839,314       1,834,495  
Retained earnings   1,061,897       989,111  
Accumulated other comprehensive loss   (103,770 )     (135,355 )
Treasury stock   (91,262 )     (88,420 )
Total stockholders' equity   2,707,555       2,601,207  
Total liabilities and stockholders' equity $ 24,547,286     $ 24,051,825  
 


 
PROVIDENT FINANCIAL SERVICES, INC. AND SUBSIDIARY
Consolidated Statements of Income
Three months ended June 30, 2025, March 31, 2025 and June 30, 2024, and six months ended June 30, 2025 and 2024 (Unaudited)
(Dollars in Thousands, except per share data)
                   
  Three Months Ended   Six Months Ended
  June 30,   March 31,   June 30,   June 30,   June 30,
    2025       2025     2024       2025       2024  
Interest and dividend income:                  
Real estate secured loans $ 192,792     $ 187,054   $ 156,318     $ 379,845     $ 263,774  
Commercial loans   78,854       75,819     58,532       154,673       94,632  
Consumer loans   10,464       10,158     8,351       20,623       12,874  
Available for sale debt securities, equity securities and Federal Home Loan Bank stock   31,444       29,644     20,394       61,088       32,724  
Held to maturity debt securities   1,966       1,996     2,357       3,962       4,625  
Deposits, federal funds sold and other short-term investments   788       675     1,859       1,463       3,041  
Total interest income   316,308       305,346     247,811       621,654       411,670  
                   
Interest expense:                  
Deposits   96,257       97,420     81,058       193,678       133,592  
Borrowed funds   24,470       17,778     20,566       42,247       37,949  
Subordinated debt   8,487       8,420     4,681       16,907       4,953  
Total interest expense   129,214       123,618     106,305       252,832       176,494  
Net interest income   187,094       181,728     141,506       368,822       235,176  
Provision (benefit) charge for credit losses   (2,888 )     638     69,705       (2,250 )     69,385  
Net interest income after provision for credit losses   189,982       181,090     71,801       371,072       165,791  
                   
Non-interest income:                  
Fees   10,736       9,655     8,699       20,391       14,611  
Wealth management income   6,948       7,328     7,769       14,275       15,257  
Insurance agency income   4,942       5,651     4,488       10,593       9,281  
Bank-owned life insurance   2,585       2,092     3,323       4,678       5,140  
Net gain (loss) on securities transactions         87     (2,973 )     87       (2,974 )
Other income   1,864       2,217     969       4,081       1,766  
Total non-interest income   27,075       27,030     22,275       54,105       43,081  
                   
Non-interest expense:                  
Compensation and employee benefits   63,249       62,366     54,888       125,615       94,936  
Net occupancy expense   13,011       13,927     11,142       26,938       19,662  
Data processing expense   9,599       9,605     8,433       19,203       15,217  
FDIC Insurance   3,341       3,385     3,100       6,727       5,372  
Amortization of intangibles   9,497       9,501     6,483       18,998       7,188  
Advertising and promotion expense   1,429       1,060     1,171       2,489       2,137  
Merger-related expenses             18,915             21,117  
Other operating expenses   14,488       16,423     11,262       30,911       21,592  
Total non-interest expense   114,614       116,267     115,394       230,881       187,221  
Income (loss) before income tax expense   102,443       91,853     (21,318 )     194,296       21,651  
Income tax expense (benefit)   30,462       27,825     (9,833 )     58,287       1,055  
Net income (loss) $ 71,981     $ 64,028   $ (11,485 )   $ 136,009     $ 20,596  
                   
Basic earnings per share $ 0.55     $ 0.49   $ (0.11 )   $ 1.04     $ 0.23  
Average basic shares outstanding   130,484,287       130,325,393     102,957,521       130,405,490       89,108,775  
                   
Diluted earnings per share $ 0.55     $ 0.49   $ (0.11 )   $ 1.04     $ 0.23  
Average diluted shares outstanding   130,500,143       130,380,475     102,957,521       130,440,958       89,116,590  
                                     


 
PROVIDENT FINANCIAL SERVICES, INC. AND SUBSIDIARY
Net Interest Margin Analysis
Quarterly Average Balances
(Dollars in Thousands) (Unaudited)
  June 30, 2025   March 31, 2025   June 30, 2024
  Average Balance   Interest   Average
Yield/Cost
  Average Balance   Interest   Average
Yield/Cost
  Average Balance   Interest   Average
Yield/Cost
Interest-Earning Assets:                                  
Deposits $ 75,714   $ 788   4.21 %   $ 80,074   $ 675   4.21 %   $ 40,228   $ 1,859   5.38 %
Available for sale debt securities   2,958,325     29,306   3.96 %     2,827,699     27,621   3.89 %     2,244,725     17,646   3.14 %
Held to maturity debt securities, net (1)   315,204     1,966   2.49 %     320,036     1,996   2.50 %     352,216     2,357   2.68 %
Equity securities, at fair value   19,235       %     19,840       %     10,373       %
Total securities   3,292,764     31,272   3.80 %     3,167,575     29,617   3.73 %     2,607,314     20,003   3.07 %
Federal Home Loan Bank stock   133,447     2,138   6.44 %     107,527     2,023   7.53 %     88,864     2,747   12.36 %
Net loans: (2)                                  
Total mortgage loans   13,398,650     192,792   5.77 %     13,297,168     187,054   5.70 %     10,674,109     156,318   5.81 %
Total commercial loans   4,816,237     78,854   6.57 %     4,684,572     75,819   6.56 %     3,514,602     58,532   6.62 %
Total consumer loans   612,418     10,464   6.85 %     609,137     10,158   6.76 %     460,702     8,351   7.29 %
Total net loans   18,827,305     282,110   6.01 %     18,590,877     273,031   5.95 %     14,649,413     223,201   6.05 %
Total interest-earning assets $ 22,329,230   $ 316,308   5.68 %   $ 21,946,053   $ 305,346   5.63 %   $ 17,385,819   $ 247,810   5.67 %
                                   
Non-Interest Earning Assets:                                  
Cash and due from banks   150,464             134,205             37,621        
Other assets   1,870,114             1,969,060             1,773,601        
Total assets $ 24,349,808           $ 24,049,318           $ 19,197,041        
                                   
Interest-Bearing Liabilities:                                  
Demand deposits $ 9,874,149   $ 64,803   2.63 %   $ 10,095,570   $ 65,433   2.63 %   $ 7,935,543   $ 58,179   2.95 %
Savings deposits   1,647,746     900   0.22 %     1,682,596     924   0.22 %     1,454,784     832   0.23 %
Time deposits   3,197,374     30,555   3.83 %     3,199,620     31,063   3.94 %     2,086,433     22,047   4.25 %
Total deposits   14,719,269     96,258   2.62 %     14,977,786     97,420   2.64 %     11,476,760     81,058   2.84 %
                                   
Borrowed funds   2,490,379     24,470   3.94 %     1,918,069     17,778   3.76 %     2,158,193     20,565   3.83 %
Subordinated debentures   403,286     8,487   8.44 %     402,037     8,420   8.49 %     221,086     4,681   8.52 %
Total interest-bearing liabilities   17,612,934     129,215   2.94 %     17,297,892     123,618   2.90 %     13,856,039     106,304   3.09 %
                                   
Non-Interest Bearing Liabilities:                                  
Non-interest bearing deposits   3,700,132             3,719,177             2,866,917        
Other non-interest bearing liabilities   352,400             393,888             346,616        
Total non-interest bearing liabilities   4,052,532             4,113,065             3,213,533        
Total liabilities   21,665,466             21,410,957             17,069,572        
Stockholders' equity   2,684,342             2,638,361             2,127,469        
Total liabilities and stockholders' equity $ 24,349,808           $ 24,049,318           $ 19,197,041        
                                   
Net interest income     $ 187,093           $ 181,728           $ 141,506    
                                   
Net interest rate spread         2.74 %           2.73 %           2.58 %
Net interest-earning assets $ 4,716,296           $ 4,648,161           $ 3,529,780        
                                   
Net interest margin (3)         3.36 %           3.34 %           3.21 %
                                   
Ratio of interest-earning assets to total interest-bearing liabilities 1.27x           1.27x           1.25x        
                                   


   
(1) Average outstanding balance amounts shown are amortized cost, net of allowance for credit losses.
(2) Average outstanding balances are net of the allowance for loan losses, deferred loan fees and expenses, loan premiums and discounts and include non-accrual loans.
(3) Annualized net interest income divided by average interest-earning assets.


       
The following table summarizes the quarterly net interest margin for the previous five quarters.      
  6/30/25   3/31/25   12/31/24   9/30/24   6/30/24
  2nd Qtr.   1st Qtr.   4th Qtr.   3rd Qtr.   2nd Qtr.
Interest-Earning Assets:                  
Securities 3.80 %   3.73 %   3.55 %   3.56 %   3.07 %
Net loans 6.01 %   5.95 %   5.99 %   6.21 %   6.05 %
Total interest-earning assets 5.68 %   5.63 %   5.66 %   5.84 %   5.67 %
                   
Interest-Bearing Liabilities:                  
Deposits 2.62 %   2.64 %   2.81 %   2.96 %   2.84 %
Borrowings 3.94 %   3.76 %   3.64 %   3.73 %   3.83 %
Total interest-bearing liabilities 2.94 %   2.90 %   3.03 %   3.19 %   3.09 %
                   
Interest rate spread 2.74 %   2.73 %   2.63 %   2.65 %   2.58 %
Net interest margin 3.36 %   3.34 %   3.28 %   3.31 %   3.21 %
                   
Ratio of interest-earning assets to interest-bearing liabilities 1.27x   1.27x   1.27x   1.26x   1.25x
                   


 
PROVIDENT FINANCIAL SERVICES, INC. AND SUBSIDIARY
Net Interest Margin Analysis
Average Year to Date Balances
(Dollars in Thousands) (Unaudited)
                       
  June 30, 2025   June 30, 2024
  Average       Average   Average       Average
  Balance   Interest   Yield/Cost   Balance   Interest   Yield/Cost
Interest-Earning Assets:                      
Deposits $ 77,882   $ 1,463   4.21 %   $ 32,901   $ 3,041   5.38 %
Available for sale debt securities   2,893,373     56,927   3.91 %     1,959,549     27,669   2.82 %
Held to maturity debt securities, net (1)   317,607     3,962   2.50 %     354,731     4,625   2.61 %
Equity securities, at fair value   19,212       %     5,525       %
Total securities   3,230,192     60,889   3.75 %     2,319,805     32,294   2.78 %
Federal Home Loan Bank stock   120,883     4,161   6.92 %     81,309     5,055   12.43 %
Net loans: (2)                      
Total mortgage loans   13,351,451     379,845   5.73 %     9,326,838     263,774   5.61 %
Total commercial loans   4,747,564     154,673   6.57 %     2,953,842     94,632   6.39 %
Total consumer loans   610,728     20,623   6.81 %     378,522     12,874   6.84 %
Total net loans   18,709,743     555,141   5.98 %     12,659,202     371,280   5.83 %
Total interest-earning assets $ 22,138,700   $ 621,654   5.65 %   $ 15,093,217   $ 411,670   5.43 %
                       
Non-Interest Earning Assets:                      
Cash and due from banks   142,380             108,229        
Other assets   1,919,313             1,443,958        
Total assets $ 24,200,393           $ 16,645,404        
                       
Interest-Bearing Liabilities:                      
Demand deposits $ 9,984,248   $ 130,235   2.63 %   $ 6,914,802   $ 99,745   2.90 %
Savings deposits   1,665,075     1,824   0.22 %     1,308,983     1,469   0.23 %
Time deposits   3,198,491     61,618   3.88 %     1,575,801     32,378   4.13 %
Total deposits   14,847,814     193,677   2.63 %     9,799,586     133,592   2.74 %
Borrowed funds   2,205,805     42,247   3.86 %     2,049,587     37,949   3.75 %
Subordinated debentures   402,665     16,907   8.47 %     115,899     4,953   8.59 %
Total interest-bearing liabilities $ 17,456,284   $ 252,831   2.92 %   $ 11,965,072   $ 176,494   2.97 %
                       
Non-Interest Bearing Liabilities:                      
Non-interest bearing deposits   3,709,602             2,469,459        
Other non-interest bearing liabilities   373,029             298,053        
Total non-interest bearing liabilities   4,082,631             2,767,512        
Total liabilities   21,538,915             14,732,584        
Stockholders' equity   2,661,478             1,912,820        
Total liabilities and stockholders' equity $ 24,200,393           $ 16,645,404        
                       
Net interest income     $ 368,823           $ 235,176    
                       
Net interest rate spread         2.73 %           2.46 %
Net interest-earning assets $ 4,682,416           $ 3,128,145        
                       
Net interest margin (3)         3.35 %           3.08 %
                       
Ratio of interest-earning assets to total interest-bearing liabilities 1.27x           1.26x        
                       
                       
(1)  Average outstanding balance amounts shown are amortized cost, net of allowance for credit losses.
(2)  Average outstanding balance are net of the allowance for loan losses, deferred loan fees and expenses, loan premium and discounts and include non-accrual loans.
(3)  Annualized net interest income divided by average interest-earning assets.


 
The following table summarizes the year-to-date net interest margin for the previous three years.
           
  Six Months Ended
  June 30, 2025   June 30, 2024   June 30, 2023
Interest-Earning Assets:          
Securities 3.75 %   2.78 %   2.32 %
Net loans 5.98 %   5.83 %   5.18 %
Total interest-earning assets 5.65 %   5.43 %   4.68 %
           
Interest-Bearing Liabilities:          
Deposits 2.63 %   2.74 %   1.62 %
Borrowings 3.86 %   3.75 %   3.01 %
Total interest-bearing liabilities 2.92 %   2.97 %   1.84 %
           
Interest rate spread 2.73 %   2.46 %   2.84 %
Net interest margin 3.35 %   3.08 %   3.29 %
           
Ratio of interest-earning assets to interest-bearing liabilities 1.27x   1.26x   1.33x
           

SOURCE: Provident Financial Services, Inc.
CONTACT: Investor Relations, 1-732-590-9300
Web Site: http://www.Provident.Bank


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