Northfield Bancorp, Inc. (Staten Island, NY) (‘Northfield Bancorp’) operates as a holding company for Northfield Bank (the ‘bank’) that provides a full range of banking services primarily to individuals and corporate customers in Richmond and Kings counties in New York, and Hunterdon, Mercer, Union and Middlesex counties in New Jersey.
Northfield Bancorp is subject to comprehensive regulation and examination by the Board of Governors of the Federal Reserve System.
Northfield Bank
Northfield B...
Northfield Bancorp, Inc. (Staten Island, NY) (‘Northfield Bancorp’) operates as a holding company for Northfield Bank (the ‘bank’) that provides a full range of banking services primarily to individuals and corporate customers in Richmond and Kings counties in New York, and Hunterdon, Mercer, Union and Middlesex counties in New Jersey.
Northfield Bancorp is subject to comprehensive regulation and examination by the Board of Governors of the Federal Reserve System.
Northfield Bank
Northfield Bank is a federally chartered savings bank. Northfield Bank conducts business from its operations center located in Woodbridge, New Jersey, its home office located at a branch in Staten Island, New York, and its various additional branch offices located in Staten Island, Brooklyn, and the New Jersey counties of Hunterdon, Mercer, Middlesex, and Union. Northfield Bank also offers select loan and deposit products through the internet.
Northfield Bank’s principal business consists of originating multifamily and commercial real estate loans, construction and land loans, commercial and industrial loans, and home equity loans and lines of credit. From time to time, Northfield Bank will also purchase loan participations and pools of loans. Northfield Bank also purchases investment securities, including mortgage-backed securities and corporate bonds, and, to a lesser extent, deposit funds in other financial institutions, including the Federal Reserve Bank of New York (or the ‘Federal Reserve Bank’), and the Federal Home Loan Bank (‘FHLB’) of New York (‘FHLBNY’).
Northfield Bank offers a variety of deposit accounts, including certificates of deposit, passbook, statement, money market savings, and transaction deposit accounts, which are Northfield Bank’s primary source of funds for its lending and investing activities. Northfield Bank also borrows funds, principally through FHLBNY advances and repurchase agreements with brokers. Northfield Bank owns 100% of NSB Services Corp., which, in turn, owns 100% of the voting common stock of a real estate investment trust, NSB Realty Trust, which holds primarily mortgage loans.
Northfield Bank is subject to comprehensive regulation and examination by the Office of the Comptroller of the Currency (the ‘OCC’).
Market Area
The bank offers a variety of financial products and services to meet the needs of the communities it serves. The company’s commercial and retail banking network consists of multiple delivery channels, including full-service banking offices, automated teller machines, and telephone and internet banking capabilities, mobile banking, and remote deposit capture. In addition, Northfield Bank offers ACH and wire transfers, cash management, positive pay, and remote deposit capture services for the company’s commercial customers.
The company’s market areas have a high concentration of financial institutions, including large money center and regional banks, non-traditional banks, community banks, and credit unions. The company’s deposit sources are primarily concentrated in the communities surrounding its branch offices in Richmond (Staten Island) and Kings (Brooklyn) counties in New York, and Hunterdon, Mercer, Middlesex, and Union counties in New Jersey.
Lending Activities
The company’s principal lending activity was historically the origination of multifamily real estate loans, but is now the origination of commercial and industrial and owner-occupied commercial real estate loans, and, to a lesser extent, multifamily and other commercial real estate loans (typically on office, retail, and industrial properties), in New York, New Jersey, and eastern Pennsylvania. It also originates one-to-four family residential real estate loans (non-owner occupied investment properties), construction and land loans, and home equity loans and lines of credit.
For the year ended December 31, 2024, the company’s loan portfolio included real estate loans, which include multifamily, commercial, one-to-four family residential, construction and land, and home equity and lines of credit; commercial and industrial loans; other loans; and PCD loans.
Multifamily Real Estate Loans: The company includes in this category properties having more than four residential units and a business or businesses where the majority of space is utilized for residential purposes, which it refers to as mixed-use. The company’s multifamily real estate loans typically amortize over 30 years with negotiated interest rates that adjust after an initial five-, seven-, or 10-year period, and every five years thereafter. Adjustable-rate loan originations are generally tied to a specifically identified market rate index. The company also originates, to a lesser extent, 10- to 15-year fixed-rate, fully amortizing loans. In general, the company’s multifamily real estate loans have interest rate floors equal to the interest rate on the date the loan is originated, and have prepayment penalties should the loan be prepaid during the initial five-, seven-, or 10-year term.
Commercial Real Estate Loans: Substantially all of the company’s commercial real estate loans are secured by properties located in its primary market areas. The company’s commercial real estate loans typically amortize over 20 to 25 years with negotiated interest rates that adjust after an initial five-, seven-, or 10-year period, and every five years thereafter. Adjustable-rate loan originations are generally tied to a specifically identified market rate index. The company also originates, to a lesser extent, 10- to 15-year fixed-rate, fully amortizing loans. In general, the company’s commercial real estate loans have interest rate floors equal to the interest rate on the date the loan is originated, and generally have prepayment penalties if the loan is repaid in the initial five-, seven-, or 10-year term.
Construction and Land Loans: The company’s construction and land loans typically are interest-only loans with interest rates that are tied to the Prime Rate as published in The Wall Street Journal. Margins generally range from zero to 200 basis points above the Prime Rate. The company also originates, to a lesser extent, 10- to 15-year fixed-rate, fully amortizing land loans. In general, the company’s construction and land loans have interest rate floors equal to the interest rate on the date the loan is originated, and it does not typically charge prepayment penalties.
Land loans also help finance the purchase of land intended for future development, including single-family housing, multifamily housing, and commercial property. In general, the maximum loan-to-value ratio for land acquisition loans is 50% of the appraised value of the property, and the maximum term of these loans is three years. Construction and land loans generally carry higher interest rates and have shorter terms than multifamily and commercial real estate loans. Construction and land loans have greater credit risk than long-term financing on improved, income-producing real estate.
Commercial and Industrial Loans: The company’s term commercial and industrial loans typically amortize over five to seven years with interest rates that are primarily indexed to various FHLB rates, and to a lesser extent, the Prime Rate. Margins generally range from zero to 300 basis points above the index rate. The company also originates, to a lesser extent, 10-year fixed-rate, fully amortizing loans. In general, the company’s commercial and industrial loans have interest rate floors equal to the interest rate on the date the loan is originated and have prepayment penalties.
The company makes various types of secured and unsecured commercial and industrial loans for the purpose of working capital and other general business purposes. The terms of these loans generally range from less than one year to a maximum of seven years; however, it could allow for a maximum of 10 years depending on industry or asset type.
Commercial and industrial loans generally carry higher interest rates than multifamily and commercial real estate loans.
One-to-Four Family Residential Real Estate Loans: The company has established a one-to-four family residential mortgage lending program to originate retail first mortgage loans. These mortgages will be either held-for-investment or held-for-sale and sold in the secondary market.
Home Equity Loans and Lines of Credit: This loan was performing in accordance with its original contractual terms. The company offers home equity loans and home equity lines of credit that are secured by the borrower’s primary residence or second home. The company’s home equity loans typically are fully amortizing with fixed terms up to 25 years. Home equity loans and lines of credit generally are underwritten with the same criteria the company uses to underwrite fixed-rate, one-to-four family residential real estate loans. Home equity loans and lines of credit may be underwritten with a loan-to-value ratio of 80% when combined with the principal balance of the existing mortgage loan.
PCD Loans: Under the current expected credit losses (‘CECL’) methodology, the company elected to maintain pools of loans that were previously accounted for under Accounting Standards Codification (‘ASC’) Subtopic 310-30 - Accounting for Purchased Loans with Deteriorated Credit Quality (‘ASC 310-30’), and will continue to account for these pools as a unit of account. Loans are only removed from existing pools if they are written off, paid off, or sold. Under CECL, the allowance for credit losses was determined for each pool and added to the pool's carrying amount to establish a new amortized cost basis.
As of December 31, 2024, PCD loans consisted of approximately 9% one-to-four family residential loans, 25% commercial real estate loans, 55% commercial and industrial loans, and 11% in home equity loans.
Securities
The company purchases mortgage-backed securities insured or guaranteed primarily by the Federal National Mortgage Association (‘Fannie Mae’), the Federal Home Loan Mortgage Corporation (‘Freddie Mac’), or the Government National Mortgage Association (‘Ginnie Mae’). The company invests in mortgage-backed securities to achieve positive interest rate spreads with minimal administrative expense, and to lower the company’s credit risk as a result of the guarantees provided, as well as to provide it liquidity to fund loan originations and deposit outflows. Mortgage-backed securities are securities sold in the secondary market that are collateralized by pools of mortgages.
At December 31, 2024, the company’s corporate bond portfolio consisted of securities, substantially all of which were investment-grade, and had remaining maturities generally shorter than ten years.
At December 31, 2024, the company’s securities were U.S. treasuries; U.S. government agency securities; mortgage-backed securities, such as pass-through certificates (GSEs) and REMICs (GSEs); and other debt securities (municipal bonds and corporate bonds).
Deposits
For the year ended December 31, 2024, the company’s deposits included transactions, which included negotiable orders of withdrawal (NOW) and interest-bearing checking, and non-interest-bearing checking; savings, which included money market, brokered money market, and savings; and certificates of deposit, which included under $250,000, and $250,000 or more.
Supervision and Regulation
Northfield Bank is a federally chartered savings bank that is primarily regulated, examined, and supervised by the OCC, and by the FDIC as a deposit insurer for certain activities. Northfield Bank is also a member of, and owns stock in, the FHLBNY, which is one of the 11 regional banks in the FHLB System.
As a savings and loan holding company, Northfield Bancorp is required to comply with the rules and regulations of the FRB. Northfield Bancorp is also subject to the rules and regulations of the SEC under the federal securities laws.
As a federally chartered savings bank, Northfield Bank is required to satisfy a qualified thrift lender (‘QTL’) test, under which it either must qualify as a ‘domestic building and loan’ association as defined by the Internal Revenue Code or maintain at least 65% of the company’s ‘portfolio assets’ in ‘qualified thrift investments.
Northfield Bank is a member of the Deposit Insurance Fund, which is administered by the FDIC. Deposit accounts in Northfield Bank are insured by the FDIC up to a maximum of $250,000 per account ownership category for each separately insured depositor.
Northfield Bank is a member of the FHLBNY, and therefore is a member of the FHLB System, which consists of 11 regional FHLBs. The FHLB System provides a central credit facility primarily for member institutions. Members of the FHLB are required to acquire and hold a specified amount of shares of FHLB capital stock. Northfield Bank was in compliance with this requirement at December 31, 2024.
In the most recent Community Reinvestment Act Public Disclosure issued by the OCC as of May 15, 2023, Northfield Bank was rated ‘Satisfactory.’
Northfield Bank’s operations are also subject to federal laws applicable to credit transactions, such as the Truth-In-Lending Act, governing disclosures of credit terms to consumer borrowers; Real Estate Settlement Procedures Act, requiring that borrowers for mortgage loans for one-to-four family residential real estate receive various disclosures, including good faith estimates of settlement costs, lender servicing and escrow account practices, and prohibiting certain practices that increase the cost of settlement services; Home Mortgage Disclosure Act, requiring financial institutions to provide information to enable the public and public officials to determine whether a financial institution is fulfilling its obligation to help meet the housing needs of the community it serves; Equal Credit Opportunity Act and the Fair Housing Act, prohibiting discrimination on the basis of race, creed, or other prohibited factors in extending credit; Fair Credit Reporting Act, governing the use and provision of information to credit reporting agencies; Fair Debt Collection Practices Act, governing the manner in which consumer debts may be collected; Flood Disaster Protection Act, requiring flood insurance of collateral properties located in designated flood zones; Servicemembers Civil Relief Act, providing a wide range of protections in lending for individuals entering or called to active duty in the military, and for deployed service members; and rules and regulations of the various federal agencies charged with the responsibility of implementing such federal laws.
The operations of Northfield Bank also are subject to the Truth in Savings Act and Regulation DD, which requires disclosures of deposit terms to consumers; Regulation CC, which relates to the availability of deposit funds to consumers; Right to Financial Privacy Act, which imposes a duty to maintain confidentiality of consumer financial records and prescribes procedures for complying with administrative subpoenas of financial records; Electronic Funds Transfer Act, which governs automatic deposits to and withdrawals from deposit accounts and customers’ rights and liabilities arising from the use of automated teller machines and other electronic banking services; The Bank Secrecy Act and USA PATRIOT Act, which require federal savings associations to, among other things, establish anti-money laundering and countering the financing of terrorism compliance programs, customer identification programs, and customer due diligence policies and controls to ensure the detection and prevention of money laundering, terrorist financing, and other illicit activities; regulations of the Office of Foreign Assets Control, which enforce economic and trade sanctions against targeted foreign countries and regimes, individuals, and organizations; and The Gramm-Leach-Bliley Act, which places limitations on the sharing of consumer financial information by financial institutions with unaffiliated third parties and requires all financial institutions offering products or services to retail customers to provide such customers with the financial institution’s privacy policy and allow such customers the opportunity to ‘opt out’ of the sharing of certain personal financial information with unaffiliated third parties.
Northfield Bancorp is a unitary savings and loan holding company subject to regulation and supervision by the FRB. The FRB has enforcement authority over Northfield Bancorp and its non-savings association subsidiaries.
Northfield Bancorp’s common stock is registered with the SEC under the Securities Exchange Act of 1934, as amended. Northfield Bancorp is subject to the information, proxy solicitation, insider trading restrictions, and other requirements under the Securities Exchange Act of 1934.
Northfield Bancorp has policies, procedures, and systems designed to comply with the Sarbanes-Oxley Act.
Under the Change in Bank Control Act, no person may acquire control of a savings and loan holding company, such as Northfield Bancorp, unless the FRB has been given 60 days prior written notice and has not issued a notice disapproving the proposed acquisition, taking into consideration certain factors, including the financial and managerial resources of the acquirer and the competitive effects of the acquisition. Acquisition of more than 10% of any class of a savings and loan holding company’s voting stock constitutes a rebuttable determination of control under the regulations under certain circumstances, including where, as is the case with Northfield Bancorp, the issuer has registered securities under Section 12 of the Securities Exchange Act of 1934.
History
Northfield Bancorp, Inc. (Staten Island, NY) was founded in 1887.
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