Blue Foundry Bancorp operates as the bank holding company for Blue Foundry Bank that provides various banking products and services.
The company's principal business consists of originating one-to-four family residential, multifamily, and non-residential real estate mortgages, home equity loans and lines of credit, construction and commercial and industrial loans in its principal market and surrounding areas. In addition, the company occasionally lends outside of its branch network in more dens...
Blue Foundry Bancorp operates as the bank holding company for Blue Foundry Bank that provides various banking products and services.
The company's principal business consists of originating one-to-four family residential, multifamily, and non-residential real estate mortgages, home equity loans and lines of credit, construction and commercial and industrial loans in its principal market and surrounding areas. In addition, the company occasionally lends outside of its branch network in more densely populated and metropolitan areas, adding diversification to its loan portfolio. The company attracts retail deposits from the general public in the areas surrounding its banking offices, through its borrowers, and through its online presence, offering a wide variety of deposit products. The company also invests in securities. The company's revenues are derived primarily from interest on loans and, to a lesser extent, interest on mortgage-backed and other investment securities. The company's primary sources of funds are deposits, principal and interest payments on loans and securities, and borrowings from the Federal Home Loan Bank of New York (FHLB).
Market Area
The company's market area is primarily northern New Jersey. The company operates full service banking offices in Bergen, Essex, Hudson, Middlesex, Morris, Passaic, and Union counties in New Jersey. The administrative offices of the company and Bank are located at 7 Sylvan Way, Suite 200, Parsippany, New Jersey 07054.
Loans
Residential Real Estate Loans
The company's one-to-four family residential loan portfolio consists of mortgage loans that enable borrowers to purchase or refinance existing homes, most of which serve as the primary residence of the borrower.
The company offers fixed-rate and adjustable-rate residential real estate loans with maturities up to 30 years. The one-to-four family residential mortgage loans it is originating are generally underwritten according to Fannie Mae and Freddie Mac guidelines and it refers to loans that conform to such guidelines as 'conforming loans.' The company generally originates both fixed and adjustable-rate mortgage loans in amounts up to the maximum conforming loan limits. The company originates loans above the conforming limits up to a maximum amount of $3.0 million, which are referred to as 'jumbo loans.' The company generally underwrites jumbo loans, whether originated or purchased, in a manner similar to conforming loans. As of December 31, 2023, the company's largest one-to-four family residential loan totaled $3.7 million, is secured by single family home located on approximately 53 acres of property and was not performing in accordance with its original terms.
The company originates one-to-four family residential mortgage loans with loan-to-value ratios of generally up to 80% to 90% of the appraised value, depending on the size of the loan. The company may originates loans with loan-to-value ratios that exceed 90% depending upon the product type. Mortgage insurance is required for all mortgage loans that have a loan-to-value ratio greater than 80%.
Multifamily Loans
The company's multifamily loans are secured primarily by apartment buildings having five or more units, most of which are located in its primary market area.
The company generally originates multifamily loans with maximum terms of 10 years based on amortization periods between 25 and 30 years. The company generally limits loan-to-value ratios to less than 80% of the appraised value of the property for multifamily loans. Its multifamily loans are offered with fixed and adjustable rate interest terms. All multifamily loans are subject to its underwriting procedures and guidelines.
Non-Residential Real Estate Loans
The company's non-residential real estate loans are secured primarily by industrial facilities, retail facilities and other commercial properties, most of which are located in its primary market area.
Construction Loans
The company makes construction loans, primarily to contractors and builders of multifamily and mixed-use projects and other commercial and industrial real estate projects.
Junior Liens and Consumer Loans: The company offers consumer loans to customers residing in its market area. Its consumer loans and junior liens consist primarily of home equity loans and lines of credit.
Home equity loans and lines of credit are multi-purpose loans used to finance various home or personal needs, where a one-to-four family primary or secondary residence serves as collateral. The company generally originates home equity loans and lines of credit of up to $500,000 with a maximum loan-to-value ratio of 80% (75% if the loan is for a condo) and terms of up to 20 years.
Commercial and Industrial Loans
The company typically originates commercial business loans on the basis of the borrower's ability to make repayment from the cash flow of the borrower's business, the experience and stability of the borrower's management team, earnings projections, and the value and marketability of any collateral securing the loan. Commercial and industrial loans are generally secured by a variety of collateral, primarily accounts receivable, inventory and equipment.
The bank is a certified Small Business Administration (SBA) lender and is a participant in SBA lending programs which typically provides guarantees of up to 75% of the principal on the underlying loans. The company provides loans under the 7(a) Loan Program, the SBA's most common loan program. The company may sell a portion of these loans in the secondary market.
The company offers term loans, lines of credit and revolving lines of credit with varying maturity terms to small businesses in its market area to finance short-term working capital needs such as accounts receivable and inventory. The company's commercial lines of credit are typically structured with variable rates. The company generally obtains personal guarantees with respect to all commercial and industrial loans.
The company participated in the SBA's Paycheck Protection Program (PPP).
Investment Activities
As of December 31, 2023, the company's securities portfolio consisted of approximately 60% high-quality liquid assets, with the remaining 40% consisting of corporate bonds, municipal bonds, privately issued asset-backed securities and other investment securities. Approximately 90% of the company's securities portfolio was classified as available-for-sale, with the remaining 10% classified as held-to-maturity.
As of December 31, 2023, other investments primarily consisted of membership and activity-based shares in FHLB stock. As a member of FHLB, the company is required to purchase stock in the FHLB, which stock is carried at cost and classified as other investment securities. Other investments also consist of, to a much lesser extent, an investment in a financial technology fund carried at net asset value (NAV) and shares in a cooperative that provides community banking core technology solutions, carried at cost.
Deposit Accounts
The substantial majority of the company's deposits are from depositors who reside in the company's primary market area. The company attracts deposit customers by offering a broad selection of deposit instruments for individuals and businesses.
As of December 31, 2023, the company's deposits were non-interest bearing deposits, NOW and demand accounts, savings deposits, and time deposits.
Subsidiary Activities
As of December 31, 2023, the bank had two active subsidiaries, Blue Foundry Investment Company, a New Jersey corporation formed to manage and invest in securities and TrackView LLC, a limited liability company formed to hold certain real estate owned.
Supervision and Regulation
The bank is subject to comprehensive regulation and examination by the New Jersey Department of Banking and Insurance ('NJDOBI') and the Federal Deposit Insurance Corporation ('FDIC').
As a New Jersey-chartered savings bank, the bank is subject to comprehensive regulation by the NJDOBI, as its chartering authority and, as a federally insured nonmember institution, by the FDIC. The bank is a member of the FHLB and its deposits are insured up to applicable limits by the FDIC.
The bank derives its lending, investment and other activity powers primarily from the New Jersey Banking Act and its related regulations. The bank is subject to extensive regulation, examination and supervision by the FDIC as its primary federal prudential regulator and the insurer of its deposits. The bank is a member of the Deposit Insurance Fund, which is administered by the FDIC.
The bank is subject to requirements of Section 112 of Federal Deposit Insurance Corporation Improvement Act ('FDICIA 112'). The bank's most recent FDIC CRA (Community Reinvestment Act) rating in March 2021 was 'Satisfactory'.
The bank is subject to a variety of federal and New Jersey statutes and regulations that are intended to protect consumers and prohibit discrimination in the granting of credit. These statutes and regulations provide for a range of sanctions for non-compliance with their terms, including imposition of cease-and-desist orders and civil money penalties, and referral to the U.S. Attorney General for prosecution of a civil action seeking actual and punitive damages and injunctive relief. Certain of these statutes, including Section 5 of the Federal Trade Commission Act, which prohibits unfair and deceptive acts and practices against consumers. Federal laws also prohibit unfair, deceptive or abusive acts or practices against consumers, which can be enforced by the Consumer Financial Protection Bureau, the FDIC and state attorneys general.
The bank is a member of the Federal Home Loan Bank System.
The company is a bank holding company registered with the Federal Reserve Board and is subject to regulations, examination, supervision and reporting requirements applicable to bank holding companies.
The company's common stock is registered with the Securities and Exchange Commission. The company is subject to the information, proxy solicitation, insider trading restrictions and other requirements under the Securities Exchange Act of 1934, as amended.
The Sarbanes-Oxley Act of 2002 was enacted to improve corporate responsibility, provide for enhanced penalties for accounting and auditing improprieties at publicly traded companies and protect investors by improving the accuracy and reliability of corporate disclosures pursuant to the securities laws. The Company has policies, procedures and systems designed to comply with this Act and its implementing regulations.
History
The company was founded in 1939. It was incorporated in 2021. The company was formerly known as Boiling Springs Bancorp and changed its name to Blue Foundry Bancorp in 2019.
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