Kroll Bond Rating Agency Revises Dime Community Bancshares, Inc.’s Ratings Outlook from “Stable” to “Positive”

Rhea-AI Summary

Kroll Bond Rating Agency (KBRA) has upgraded Dime Community Bancshares' (NASDAQ: DCOM) ratings outlook from "Stable" to "Positive" while maintaining its BBB+ rating for deposits and senior unsecured debt. The improved outlook reflects DCOM's successful strategic execution, particularly in capitalizing on market disruption following 2023 bank failures. The bank has added $2 billion in core deposits over two years, improved its liquidity profile, and reduced wholesale funding. KBRA highlighted Dime's superior credit quality, with a low 15bps average NCO ratio since the global financial crisis, minimal problem loans, and improving risk ratings. The bank's deposit costs remain lower than most KBRA-rated peers, supported by a healthy DDA mix.

Positive

• Added $2 billion in core deposits over past two years
• Lower deposit costs compared to KBRA-rated peers
• Strong credit quality with 15bps average NCO ratio since financial crisis
• Successful reduction in wholesale funding
• Improved liquidity and funding profile

Negative

• None.

Insights

Banking Financial Analyst

KBRA's positive outlook revision reflects Dime's impressive deposit growth, improved funding profile, and exceptional credit quality.

The revision of Dime Community Bancshares' outlook from "Stable" to "Positive" by Kroll Bond Rating Agency represents a significant validation of the bank's strategic initiatives. The BBB+ rating for deposits and senior unsecured debt remains unchanged, but the improved outlook signals potential for future upgrades if current trends continue.

What's particularly notable is Dime's successful execution amid industry disruption following regional bank failures in 2023. The bank has strategically capitalized on market dislocation by onboarding deposit-focused teams, resulting in $2 billion in core deposit growth over two years. This influx has transformed their funding profile, with demand deposit accounts (DDA) comprising a healthy portion of the mix.

The bank's enhanced liquidity position has enabled two critical improvements: reduced reliance on wholesale funding (which is typically more expensive and volatile) and support for loan portfolio diversification. Both developments strengthen Dime's resilience against potential economic headwinds.

KBRA specifically highlighted Dime's exceptional credit quality metrics. With net charge-offs (NCOs) averaging just 0.15% since the global financial crisis—significantly outperforming industry norms—Dime has demonstrated disciplined underwriting through multiple economic cycles. Current indicators show minimal problem loans and improving risk ratings across their portfolio.

This positive outlook revision should reduce Dime's cost of capital over time and potentially enhance their competitive position in attracting both retail and commercial relationships. For a regional bank, where funding costs directly impact profitability margins, this recognition of superior liquidity management and credit discipline represents a meaningful competitive advantage in their operating markets.

HAUPPAUGE, N.Y., June 17, 2025 (GLOBE NEWSWIRE) -- Dime Community Bancshares, Inc. (the “Company” or “Dime”) (NASDAQ: DCOM), the parent company of Dime Community Bank (the “Bank”), announced that Kroll Bond Rating Agency (“KBRA”), in a report dated June 17, 2025, revised its ratings outlook from “Stable” to “Positive.” Kroll’s deposit and senior unsecured debt rating for Dime Community Bank is BBB+.

According to the KBRA report, the revision of the Outlook to “Positive” primarily reflects the strong execution of strategic initiatives in recent years, particularly capitalizing on disruption and dislocation across the Company’s footprint following area bank failures in 2023. A key success has been the onboarding of deposit-focused teams, which has significantly improved the liquidity and funding profile, with the Company now outperforming peers on most key metrics.

Over the past two years, Dime has added $2 billion in core deposits, with a healthy DDA mix which has contributed to lower deposit costs than most KBRA-rated peers. The inflow of liquidity has also enabled a meaningful reduction in wholesale funding and supported the loan diversification growth efforts.

KBRA noted that Dime's ratings are also supported by its long-standing outperformance in credit quality, demonstrated across multiple cycles. Since the onset of the global financial crisis, the Company’s NCO ratio has averaged 15 bps, highlighting its disciplined credit culture. Dime has reported a minimal level of problem loans, well-contained NCOs and improving risk ratings.

Stuart H. Lubow, President and Chief Executive Officer, stated, “KBRA has recognized the progress we have made in creating a high-quality balance sheet. As we continue to execute on our growth plan, we are pleased to see our ratings outlook revised to Positive.”

ABOUT DIME COMMUNITY BANCSHARES, INC.

Dime Community Bancshares, Inc. is the holding company for Dime Community Bank, a New York State-chartered trust company with over $14 billion in assets and the number one deposit market share among community banks on Greater Long Island ⁽¹⁾.

Dime Community Bancshares, Inc.
Investor Relations Contact:
Avinash Reddy
Senior Executive Vice President – Chief Financial Officer
Phone: 718-782-6200; Ext. 5909
Email: avinash.reddy@dime.com

¹ Aggregate deposit market share for Kings, Queens, Nassau & Suffolk counties for community banks with less than $20 billion in assets.

FORWARD-LOOKING STATEMENTS
Statements contained in this news release that are not historical facts are forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks and uncertainties which could cause actual results to differ materially from those currently anticipated.

FAQ

What is DCOM's new ratings outlook from Kroll Bond Rating Agency?

Kroll Bond Rating Agency revised Dime Community Bancshares' ratings outlook from 'Stable' to 'Positive' on June 17, 2025

What is Dime Community Bank's current deposit and senior unsecured debt rating from KBRA?

Dime Community Bank maintains a BBB+ rating from KBRA for its deposit and senior unsecured debt

How much core deposits has DCOM added in the past two years?

Dime Community Bancshares has added $2 billion in core deposits over the past two years

What is DCOM's average NCO ratio since the global financial crisis?

Dime Community Bancshares has maintained an average NCO (Net Charge-Off) ratio of 15 basis points since the global financial crisis

How did DCOM capitalize on market disruption in 2023?

DCOM capitalized on disruption following 2023 bank failures by onboarding deposit-focused teams, which improved their liquidity and funding profile