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Balance Sheet Review

Total assets decreased by $125.3 million, or 3.5 percent, to $3.474 billion at March 31, 2025, from $3.599 billion at December 31, 2024. The decrease in total assets was mainly related to a decrease in net loans and in cash and cash equivalents.

Total cash and cash equivalents decreased by $64.5 million, or 20.3 percent, to $252.8 million at March 31, 2025, from $317.3 million at December 31, 2024. The decrease in cash was primarily due to the reduction of the Bank’s exposure to wholesale funding by paying down high cost brokered deposits.

Loans receivable, net, decreased by $78.6 million, or 2.6 percent, to $2.918 billion at March 31, 2025, from $2.996 billion at December 31, 2024. Total loan decreases during the period included decreases totaling $62.3 million in commercial real estate and multi-family loans, construction loans, 1-4 family residential loans and home equity loans. The allowance for credit losses increased $16.7 million to $51.5 million, or 51.6 percent of non-accruing loans and 1.73 percent of gross loans, at March 31, 2025, as compared to an allowance for credit losses of $34.8 million, or 77.8 percent of non-accruing loans and 1.15 percent of gross loans, at December 31, 2024.

Total investment securities increased by $14.7 million, or 13.2 percent, to $125.9 million at March 31, 2025, from $111.2 million at December 31, 2024, representing current year purchases.

Deposits decreased by $64.4 million, or 2.3 percent, to $2.687 billion at March 31, 2025, from $2.751 billion at December 31, 2024. Brokered deposits decreased $112.5 million, and were offset by increases in certificates of deposit, money market accounts, transaction accounts and savings accounts which totaled $48.4 million.

Debt obligations decreased by $49.8 million to $448.5 million at March 31, 2025 from $498.3 million at December 31, 2024, due to maturities and paydowns of our FHLB advances. The weighted average interest rate of FHLB advances was 4.33 percent at March 31, 2025 and 4.35 percent at December 31, 2024. The weighted average maturity of FHLB advances as of March 31, 2025 was 0.83 years. The interest rate of our subordinated debt balances was 9.25 percent at March 31, 2025 and at December 31, 2024.

Stockholders’ equity decreased by $9.2 million, or 2.8 percent, to $314.7 million at March 31, 2025, from $323.9 million at December 31, 2024. The decrease was attributable to the decrease in retained earnings of $11.6 million, or 8.2 percent, to $130.3 million at March 31, 2025 from $141.9 million at December 31, 2024. Offsetting this were increases in accumulated other comprehensive income, and additional paid in capital on stock, which totaled $2.4 million.

First Quarter 2025 Income Statement Review

The Company reported a net loss of $8.3 million for the first quarter ended March 31, 2025 as compared to net income of $5.9 million for the first quarter ended March 31, 2024. The decline was primarily driven by an increase to the Provision for loan losses of $18.8 million. offset by $5.8 million decrease in income tax provisioning. Also, net interest income decreased by $1.1 million, or 4.9 percent, to $22.0 million for the first quarter of 2025, from $23.1 million for the first quarter of 2024. The decrease in net interest income resulted from lower interest income which was partially offset by lower interest expense.

Interest income decreased by $5.1 million, or 10.3 percent, to $44.2 million for the first quarter of 2025 from $49.3 million for the first quarter of 2024. The average balance of interest-earning assets decreased $255.9 million, or 6.9 percent, to $3.444 billion for the first quarter of 2025 from $3.699 billion for the first quarter of 2024, while the average yield decreased 13 basis points to 5.20 percent for the first quarter of 2025 from 5.33 percent for the first quarter of 2024.

Interest expense decreased by $4.0 million to $22.2 million for the first quarter of 2025 from $26.1 million for the first quarter of 2024. The decrease resulted from a decrease in the average rate paid on interest-bearing liabilities of 21 basis points to 3.33 percent for the first quarter of 2025 from 3.54 percent for the first quarter of 2024, while the average balance of interest-bearing liabilities decreased by $256.2 million to $2.701 billion for the first quarter of 2025 from $2.957 billion for the first quarter of 2024.

The net interest margin was 2.59 percent for the first quarter of 2025 compared to 2.50 percent for the first quarter of 2024. The increase in the net interest margin compared to the first quarter of 2024 was the result of a decrease in the cost of interest-bearing liabilities partially offset by the decrease in the yield on interest-earning assets.

During the first quarter of 2025, the Company recognized $4.2 million in net charge-offs compared to $1.1 million in net charge-offs in the first quarter of 2024. The Bank had non-accrual loans totaling $99.8 million, or 3.36 percent of gross loans, at March 31, 2025 as compared to $44.7 million, or 1.48 percent of gross loans, at December 31, 2024. The allowance for credit losses on loans was $51.5 million, or 1.73 percent of gross loans, at March 31, 2025, and $34.8 million, or 1.15 percent of gross loans, at December 31, 2024. The provision for credit losses was $20.8 million for the first quarter of 2025 compared to $4.2 million for the fourth quarter of 2024. Management believes that the allowance for credit losses on loans was adequate at March 31, 2025 and December 31, 2024.

Non-interest income decreased by $318 thousand to $1.8 million for the first quarter of 2025 from $2.1 million in the first quarter of 2024. The decrease in total non-interest income was mainly related to decreases in gains on equity securities and BOLI income of $245 thousand and $67 thousand, respectively.

Non-interest expense decreased by $178 thousand, or 1.2 percent, to $14.7 million for the first quarter of 2025 when compared to non-interest expense of $14.8 million for the first quarter of 2024. The decrease in these expenses for the first quarter of 2025 was primarily driven by lower regulatory assessment charges, offset by higher salaries and employee benefits.

The income tax provision decreased by $5.8 million, to an income tax credit of $3.4 million for the first quarter of 2025 when compared to a $2.5 million provision for the first quarter of 2024.

Asset Quality

During the first quarter of 2025, the Company recognized $4.2 million in net charge offs, compared to $1.1 million in net charge-offs for the first quarter of 2024.

The Bank had non-accrual loans totaling $99.8 million, or 3.36 percent of gross loans, at March 31, 2025, as compared to $22.2 million, or 0.68 percent of gross loans, at March 31, 2024. More than 60% of the non-accrual loans are current with all payments of principal, interest, taxes and insurance, including the previously mentioned loan that has been allocated a specific reserve.  However, given that the normal standard for non-accrual is a 90 day delinquency, logic and transparency dictates that this population of loans possess certain weaknesses that are beyond payment status and therefore, even though they are current, they should be placed on non-accrual.  Although our borrowers have made payment of their loan obligations to BCB a priority, our evaluation of their financial condition causes some concern about their continued ability to do so. The allowance for credit losses was $51.5 million, or 1.73 percent of gross loans, at March 31, 2025, and $34.6 million, or 1.06 percent of gross loans, at March 31, 2024. The allowance for credit losses was 51.6 percent of non-accrual loans at March 31, 2025, and 155.4 percent of non-accrual loans at March 31, 2024.

About BCB Bancorp, Inc.

Established in 2000 and headquartered in Bayonne, N.J., BCB Community Bank is the wholly-owned subsidiary of BCB Bancorp, Inc. (NASDAQ: BCBP). The Bank has twenty-three branch offices in Bayonne, Edison, Hoboken, Fairfield, Holmdel, Jersey City, Lyndhurst, Maplewood, Monroe Township, Newark, Parsippany, Plainsboro, River Edge, Rutherford, South Orange, Union, and Woodbridge, New Jersey, and four branches in Hicksville and Staten Island, New York. The Bank provides businesses and individuals a wide range of loans, deposit products, and retail and commercial banking services. For more information, please go to www.bcb.bank.

Forward-Looking Statements

This release, like many written and oral communications presented by BCB Bancorp, Inc., and our authorized officers, may contain certain forward-looking statements regarding our prospective performance and strategies within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and are including this statement for purposes of said safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe future plans, strategies, and expectations of the Company, are generally identified by use of words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “plan,” “project,” “seek,” “strive,” “try,” or future or conditional verbs such as “could,” “may,” “should,” “will,” “would,” or similar expressions. Our ability to predict results or the actual effects of our plans or strategies is inherently uncertain. Accordingly, actual results may differ materially from anticipated results.

The most significant factor that could cause future results to differ materially from those anticipated by our forward-looking statements include the ongoing impact of global tariffs imposed by the Trump administration, higher inflation levels, and general economic and recessionary concerns, all of which could impact economic growth and could cause increased loan delinquencies, a reduction in financial transactions and business activities, including decreased deposits and reduced loan originations, our ability to manage liquidity and capital in a rapidly changing and unpredictable market, supply chain disruptions, and labor shortages. Other factors that could cause future results to vary materially from current management expectations as reflected in our forward-looking statements include, but are not limited to: the global impact of the military conflicts in the Ukraine and the Middle East; unfavorable economic conditions in the United States generally and particularly in our primary market area; the Company’s ability to effectively attract and deploy deposits; changes in the Company’s corporate strategies, the composition of its assets, or the way in which it funds those assets; shifts in investor sentiment or behavior in the securities, capital, or other financial markets, including changes in market liquidity or volatility; the effects of declines in real estate values that may adversely impact the collateral underlying our loans; increase in unemployment levels and slowdowns in economic growth; our level of non-performing assets and the costs associated with resolving any problem loans including litigation and other costs; the impact of changes in interest rates and the credit quality and strength of underlying collateral and the effect of such changes on the market value of our loan and investment securities portfolios; the credit risk associated with our loan portfolio; changes in the quality and composition of the Bank’s loan and investment portfolios; changes in our ability to access cost-effective funding; deposit flows; legislative and regulatory changes, including increases in Federal Deposit Insurance Corporation, or FDIC, insurance rates; monetary and fiscal policies of the federal and state governments; changes in tax policies, rates and regulations of federal, state and local tax authorities; demands for our loan products; demand for financial services; competition; changes in the securities or secondary mortgage markets; changes in management’s business strategies; changes in consumer spending; our ability to hire and retain key employees; the effects of any reputational, credit, interest rate, market, operational, legal, liquidity, or regulatory risk; expanding regulatory requirements which could adversely affect operating results; civil unrest in the communities that we serve; and other factors discussed elsewhere in this report, and in other reports we filed with the SEC, including under “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K, and our other periodic reports that we file with the SEC.

Annualized, pro forma, projected and estimated numbers are used for illustrative purpose only, are not forecasts and may not reflect actual results.

Explanation of Non-GAAP Financial Measures

Reported amounts are presented in accordance with accounting principles generally accepted in the United States of America ("GAAP"). This press release also contains certain supplemental Non-GAAP information that the Company’s management uses in its analysis of the Company’s financial results. The Company’s management believes that providing this information to analysts and investors allows them to better understand and evaluate the Company’s financial results for the periods in question.

The Company provides measurements and ratios based on tangible stockholders' equity and efficiency ratios. These measures are utilized by regulators and market analysts to evaluate a company’s financial condition and, therefore, the Company’s management believes that such information is useful to investors. For a reconciliation of GAAP to Non-GAAP financial measures included in this press release, see "Reconciliation of GAAP to Non-GAAP Financial Measures" below.