FFIC Q3 2025: net interest income $53.8M; deposits $7.33B

Rhea-AI Filing Summary

Flushing Financial Corporation reported Q3 2025 results with net income of $10.447 million and diluted EPS of $0.30. Net interest income rose to $53.828 million as interest expense declined to $62.641 million from $76.990 million a year ago. The provision for credit losses was $1.531 million. Non-interest income was $4.746 million, while non-interest expense totaled $43.365 million.

For the first nine months of 2025, net income was $14.854 million (diluted EPS $0.43) and includes a $17.636 million goodwill impairment recorded earlier in the year. As of September 30, 2025, total assets were $8.872 billion, net loans held for investment were $6.628 billion, and total deposits were $7.333 billion. Borrowed funds were reduced to $492.457 million from $916.054 million at year-end, including Federal Home Loan Bank advances and other borrowings of $253.934 million. The company reported 33,778,438 common shares outstanding as of October 31, 2025.

Insights

Banking equity analyst

Q3 earnings improved on lower funding costs; borrowings reduced.

Flushing Financial delivered Q3 2025 net income of $10.447M with net interest income of $53.828M. Lower interest expense ($62.641M vs. $76.990M in Q3 2024) supported the margin, while the credit loss provision was modest at $1.531M. Non-interest income was $4.746M and operating expenses were $43.365M.

Year-to-date, net income of $14.854M reflects a previously recorded goodwill impairment of $17.636M. On the balance sheet, deposits reached $7.333B and net loans were $6.628B as of Sep 30, 2025. Borrowed funds declined to $492.457M from $916.054M at year-end, including FHLB and other borrowings of $253.934M.

Actual performance will hinge on funding costs and credit quality trends disclosed in future periods. Subsequent filings may provide additional detail on margin sustainability and credit provisioning.

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Table of Contents

​

​

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

​

FORM 10-Q

​

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

​

For the quarterly period ended September 30, 2025

​

Commission file number 001-33013

​

FLUSHING FINANCIAL CORPORATION

(Exact name of registrant as specified in its charter)

​

Delaware

(State or other jurisdiction of incorporation or organization)

​

11-3209278

(I.R.S. Employer Identification No.)

​

220 RXR Plaza, Uniondale, New York 11556

(Address of principal executive offices)

​

(718) 961-5400

(Registrant’s telephone number, including area code)

​

Securities registered pursuant to Section 12(b) of the Act:

​

​	​	​
Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value	FFIC	The Nasdaq Stock Market LLC

​

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    X   Yes        __No

​

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    X   Yes        __No

​

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer”, “accelerated filer” ,“smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

​

​	​
Large accelerated filer  __	Accelerated filer  X
Non-accelerated filer  __	Smaller reporting company  __
Emerging growth company  __	​

​

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the exchange act.

​

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).  __ Yes    X   No

​

The number of shares of the registrant’s Common Stock outstanding as of October 31, 2025 was 33,778,438.

​

​

​

​

​

Table of Contents

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​

TABLE OF CONTENTS

​

​	PAGE
PART I  — FINANCIAL INFORMATION	​
ITEM 1. Financial Statements - (Unaudited)	​
Consolidated Statements of Financial Condition	1
Consolidated Statements of Operations	2
Consolidated Statements of Comprehensive Income	3
Consolidated Statements of Changes in Stockholders’ Equity	4
Consolidated Statements of Cash Flows	5
Notes to Consolidated Financial Statements	7
ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	46
ITEM 3. Quantitative and Qualitative Disclosures About Market Risk	64
ITEM 4. Controls and Procedures	64
PART II  — OTHER INFORMATION	​
ITEM 1. Legal Proceedings	65
ITEM 1A. Risk Factors	65
ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds	65
ITEM 3. Defaults Upon Senior Securities	65
ITEM 4. Mine Safety Disclosures	65
ITEM 5. Other Information	65
ITEM 6. Exhibits	66
SIGNATURES	68

​

​

​

i

Table of Contents

​

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Consolidated Statements of Financial Condition

(Unaudited)

​

Item 1.   Financial Statements

​

​	​	​	​	​	​	​
​	​	September 30,		​	December 31,
​	​	2025		​	2024
​	​	(Dollars in thousands, except per share data)
Assets		​			​
Cash and due from banks (restricted cash of $17,315 and $43,165, respectively)	​	$	142,929	​	$	152,574
Securities held-to-maturity, net of allowance of $351 and $353, respectively (assets pledged of $4,680 and $4,494, respectively; fair value of $46,384 and $44,718, respectively)	​		50,509	​		51,485
Securities available for sale, at fair value (amortized cost of $1,541,505 and $1,506,798, respectively; net of an allowance of $2,921 and $2,627, respectively; assets pledged of $134,968 and $49,914, respectively; $14,210 and $13,591 at fair value pursuant to the fair value option, respectively)	​		1,541,423	​		1,497,905
Loans held for sale, at fair value	​		—	​		70,098
Loans held for investment, net of fees and costs	​		6,670,333	​		6,745,848
Less: Allowance for credit losses	​		(41,837)	​		(40,152)
Net loans held of investment	​		6,628,496	​		6,705,696
Interest and dividends receivable	​		60,044	​		62,036
Bank premises and equipment, net	​		17,073	​		17,852
Federal Home Loan Bank of New York stock, at cost	​		18,909	​		38,096
Bank owned life insurance	​		224,902	​		218,174
Goodwill	​		—	​		17,636
Core deposit intangibles	​	​	854	​	​	1,123
Right-of-use assets	​	​	47,761	​		45,800
Other assets	​		139,091	​		160,497
Total assets	​	$	8,871,991	​	$	9,038,972
​	​	​	​	​	​	​
Liabilities	​			​
Due to depositors:	​			​
Non-interest bearing	​	$	964,767	​	$	836,545
Interest-bearing	​		6,368,064	​		6,289,306
Total Due to depositors	​	​	7,332,831	​	​	7,125,851
Mortgagors' escrow deposits	​		82,697	​		53,082
Borrowed funds:	​			​
Federal Home Loan Bank advances and other borrowings	​		253,934	​		678,933
Subordinated debentures	​		188,870	​		188,326
Junior subordinated debentures, at fair value	​		49,653	​		48,795
Total borrowed funds	​		492,457	​		916,054
Operating lease liability	​	​	48,253	​	​	46,443
Other liabilities	​		204,527	​		173,003
Total liabilities	​		8,160,765	​		8,314,433
​	​	​	​	​	​	​
Stockholders' Equity	​		​	​		​
Preferred stock ($0.01 par value; 5,000,000 shares authorized; none issued)	​		—	​		—
Common stock ($0.01 par value; 100,000,000 shares authorized; 38,677,787 shares issued; 33,778,438 and 33,659,067 shares outstanding, respectively)	​		387	​		387
Additional paid-in capital	​		325,809	​		326,671
Treasury stock, at average cost (4,899,349 and 5,018,720 shares, respectively)	​		(98,948)	​		(101,655)
Retained earnings	​		483,936	​		492,003
Accumulated other comprehensive income, net of taxes	​		42	​		7,133
Total stockholders' equity	​		711,226	​		724,539
​	​	​	​	​	​	​
Total liabilities and stockholders' equity	​	$	8,871,991	​	$	9,038,972

The accompanying notes are an integral part of these consolidated financial statements.

​

​

​

-1-

Table of Contents

​

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Consolidated Statements of Operations

(Unaudited)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

For the three months ended

​

For the nine months ended

​

September 30,

​

September 30,

​

2025

2024

2025

2024

​

​

(In thousands, except per share data)

Interest and dividend income

​

​

​

​

​

​

​

​

​

​

​

​

Interest and fees on loans

​

$

94,970

​

$

95,780

​

$

283,007

​

$

281,467

Interest and dividends on securities:

​

​

​

​

Interest

​

19,785

​

​

24,215

​

61,384

​

​

54,965

Dividends

​

29

​

33

​

85

​

99

Other interest income

​

​

1,685

​

2,565

​

​

5,931

​

8,791

Total interest and dividend income

​

116,469

​

122,593

​

350,407

​

345,322

Interest expense

​

​

​

​

Deposits

​

57,137

​

66,150

​

173,348

​

184,908

Other interest expense

​

5,504

​

10,840

​

17,033

​

29,638

Total interest expense

​

62,641

​

76,990

​

190,381

​

214,546

Net interest income (loss)

​

53,828

​

45,603

​

160,026

​

130,776

Provision (benefit) for credit losses

​

1,531

​

1,727

​

10,043

​

3,128

Net interest income after provision (benefit) for credit losses

​

52,297

​

43,876

​

149,983

​

127,648

Non-interest income (loss)

​

​

​

​

Banking services fee income

​

2,000

​

1,790

​

5,469

​

4,767

Net gain (loss) on sale of loans

​

318

​

137

​

3,705

​

273

Net gain (loss) on sale of securities

​

661

​

—

​

661

​

—

Net gain (loss) from fair value adjustments

​

(1,831)

​

974

​

(327)

​

197

Federal Home Loan Bank of New York stock dividends

​

369

​

624

​

1,494

​

2,036

Life insurance proceeds

​

—

​

1

​

—

​

1

Bank owned life insurance

​

2,319

​

1,260

​

6,728

​

3,683

Other income

​

910

​

1,491

​

2,367

​

2,620

Total non-interest income (loss)

​

4,746

​

6,277

​

20,097

​

13,577

Non-interest expense

​

​

​

​

​

​

​

​

​

​

Salaries and employee benefits

​

24,685

​

22,216

​

70,229

​

66,052

Occupancy and equipment

​

4,189

​

3,745

​

12,286

​

11,237

Professional services

​

3,999

​

2,752

​

10,336

​

8,330

FDIC deposit insurance

​

1,373

​

1,318

​

4,590

​

4,292

Data processing

​

1,831

​

1,681

​

5,505

​

5,193

Depreciation and amortization of bank premises and equipment

​

1,316

​

1,436

​

4,056

​

4,318

Other real estate owned / foreclosure expense

​

353

​

135

​

918

​

405

Net (gain) loss on sales of real estate owned

​

—

​

(174)

​

—

​

(174)

Impairment of goodwill

​

​

—

​

​

—

​

​

17,636

​

​

—

Other operating expenses

​

5,619

​

5,587

​

17,841

​

17,982

Total non-interest expense

​

43,365

​

38,696

​

143,397

​

117,635

Income (loss) before income taxes

​

13,678

​

11,457

​

26,683

​

23,590

Provision (benefit) for income taxes

​

​

​

​

​

​

​

​

​

​

​

​

Federal

​

2,211

​

1,484

​

7,554

​

3,583

State and local

​

1,020

​

1,067

​

4,275

​

2,095

Total provision (benefit) for income taxes

​

3,231

​

2,551

​

11,829

​

5,678

Net income (loss)

​

$

10,447

​

$

8,906

​

$

14,854

​

$

17,912

​

​

​

​

​

​

​

​

​

​

​

​

​

Basic earnings (loss) per common share

​

$

0.30

​

$

0.30

​

$

0.43

​

$

0.60

Diluted earnings (loss) per common share

​

$

0.30

​

$

0.30

​

$

0.43

​

$

0.60

​

The accompanying notes are an integral part of these consolidated financial statements.

​

-2-

Table of Contents

​

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Consolidated Statements of Comprehensive Income

(Unaudited)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

For the three months ended

​

For the nine months ended

​

​

September 30,

​

September 30,

​

2025

2024

2025

2024

​

​

(In thousands)

Net income (loss)

​

$

10,447

​

$

8,906

​

$

14,854

​

$

17,912

Other comprehensive income (loss), net of tax:

​

​

​

​

Amortization of actuarial (gains) losses, net of taxes of $24, and $28, respectively, and of $70 and $86, respectively.

​

(49)

​

(64)

​

(149)

​

(190)

Change in net unrealized gains (losses) on securities available for sale, net of taxes of ($1,690), and ($5,886), respectively, and of ($3,017) and ($4,909), respectively.

​

3,773

​

13,062

​

6,749

​

10,896

Reclassification adjustment for net (gains) losses included in net income, net of taxes of $204 and $204, respectively.

​

(457)

​

—

​

(457)

​

—

Net unrealized (losses) gains on cashflow hedges, net of taxes of $913 and $6,542, respectively, and of $5,916 and $5,779, respectively.

​

(2,037)

​

(14,518)

​

(13,236)

​

(12,825)

Change in fair value of liabilities related to instrument-specific credit risk, net of taxes of ($33), and ($17), respectively, and of ($2) and $12, respectively.

​

76

​

37

​

2

​

(29)

Other comprehensive income (loss), net of tax:

​

1,306

​

(1,483)

​

(7,091)

​

(2,148)

Comprehensive net income (loss)

​

$

11,753

​

$

7,423

​

$

7,763

​

$

15,764

​

The accompanying notes are an integral part of these consolidated financial statements.

-3-

Table of Contents

​

​

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Consolidated Statement of Changes in Stockholders’ Equity

(Unaudited)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Additional

​

​

​

​

​

Accumulated Other

​

​

​

​

​

Shares

​

Common

​

Paid-in

​

Treasury

​

Retained

​

Comprehensive

​

​

​

(Dollars in thousands, except per share data)

​

Outstanding

Stock

​

Capital

Stock

​

Earnings

​

Income (Loss)

​

Total

Balance at December 31, 2024

​

​

33,659,067

​

$

387

​

$

326,671

​

$

(101,655)

​

$

492,003

​

$

7,133

​

$

724,539

Net income (loss)

​

​

—

​

—

​

​

—

​

​

—

​

​

(9,796)

​

​

—

​

(9,796)

Vesting of restricted stock unit awards

​

​

166,543

​

—

​

​

(3,156)

​

​

3,368

​

​

(212)

​

​

—

​

—

Stock-based compensation expense

​

​

—

​

—

​

​

775

​

​

—

​

​

—

​

​

—

​

775

Repurchase of shares to satisfy tax obligation

​

​

(48,922)

​

—

​

​

—

​

​

(706)

​

​

—

​

​

—

​

(706)

Dividends on common stock ($0.22 per share)

​

​

—

​

—

​

​

—

​

​

—

​

​

(7,523)

​

​

—

​

(7,523)

Other comprehensive income (loss)

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

(4,438)

​

​

(4,438)

Balance at March 31, 2025

​

​

33,776,688

​

$

387

​

$

324,290

​

$

(98,993)

​

$

474,472

​

$

2,695

​

$

702,851

Net income (loss)

​

​

—

​

—

​

​

—

​

​

—

​

​

14,203

​

​

—

​

14,203

Vesting of restricted stock unit awards

​

​

500

​

—

​

​

(6)

​

​

10

​

​

(4)

​

​

—

​

—

Stock-based compensation expense

​

​

—

​

—

​

​

878

​

​

—

​

​

—

​

​

—

​

878

Repurchase of shares to satisfy tax obligation

​

​

(180)

​

—

​

​

—

​

​

(2)

​

​

—

​

​

—

​

(2)

Dividends on common stock ($0.22 per share)

​

​

—

​

—

​

​

—

​

​

—

​

​

(7,594)

​

​

—

​

(7,594)

Other comprehensive income (loss)

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

(3,959)

​

​

(3,959)

Balance at June 30, 2025

​

​

33,777,008

​

$

387

​

$

325,162

​

$

(98,985)

​

$

481,077

​

$

(1,264)

​

$

706,377

Net income (loss)

​

​

—

​

—

​

​

—

​

​

—

​

​

10,447

​

​

—

​

10,447

Vesting of restricted stock unit awards

​

​

2,440

​

—

​

​

(48)

​

​

50

​

​

(2)

​

​

—

​

—

Stock-based compensation expense

​

​

—

​

—

​

​

695

​

​

—

​

​

—

​

​

—

​

695

Repurchase of shares to satisfy tax obligation

​

​

(1,010)

​

—

​

​

—

​

​

(13)

​

​

—

​

​

—

​

(13)

Dividends on common stock ($0.22 per share)

​

​

—

​

—

​

​

—

​

​

—

​

​

(7,586)

​

​

—

​

(7,586)

Other comprehensive income (loss)

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

1,306

​

​

1,306

Balance at September 30, 2025

​

​

33,778,438

​

$

387

​

$

325,809

​

$

(98,948)

​

$

483,936

​

$

42

​

$

711,226

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Additional

​

​

​

​

Accumulated Other

​

​

​

Shares

​

Common

​

Paid-in

​

Treasury

​

Retained

​

Comprehensive

​

​

(Dollars in thousands, except per share data)

​

​

Stock

​

Capital

Stock

​

Earnings

​

Income (Loss)

​

Total

Balance at December 31, 2023

​

28,865,810

​

$

341

​

$

264,534

​

$

(106,070)

​

$

549,683

​

$

(38,651)

​

$

669,837

Net income (loss)

​

—

​

—

​

​

—

​

​

—

​

​

3,684

​

​

—

​

3,684

Vesting of restricted stock unit awards

​

301,319

​

—

​

​

(5,811)

​

​

6,111

​

​

(300)

​

​

—

​

—

Stock-based compensation expense

​

—

​

—

​

​

1,690

​

​

—

​

​

—

​

​

—

​

1,690

Repurchase of shares to satisfy tax obligation

​

(98,573)

​

—

​

​

—

​

​

(1,682)

​

​

—

​

​

—

​

(1,682)

Dividends on common stock ($0.22 per share)

​

—

​

—

​

​

—

​

​

—

​

​

(6,537)

​

​

—

​

(6,537)

Other comprehensive income (loss)

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

2,835

​

​

2,835

Balance at March 31, 2024

​

29,068,556

​

$

341

​

$

260,413

​

$

(101,641)

​

$

546,530

​

$

(35,816)

​

$

669,827

Net income (loss)

​

—

​

—

​

​

—

​

​

—

​

​

5,322

​

​

—

​

5,322

Vesting of restricted stock unit awards

​

500

​

—

​

​

(5)

​

​

10

​

​

(5)

​

​

—

​

—

Stock-based compensation expense

​

—

​

—

​

​

177

​

​

—

​

​

—

​

​

—

​

177

Repurchase of shares to satisfy tax obligation

​

(176)

​

—

​

​

—

​

​

(2)

​

​

—

​

​

—

​

(2)

Dividends on common stock ($0.22 per share)

​

—

​

—

​

​

—

​

​

—

​

​

(6,502)

​

​

—

​

(6,502)

Other comprehensive income (loss)

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

(3,500)

​

​

(3,500)

Balance at June 30, 2024

​

29,068,880

​

$

341

​

$

260,585

​

$

(101,633)

​

$

545,345

​

$

(39,316)

​

$

665,322

Net income (loss)

​

—

​

—

​

​

—

​

​

—

​

​

8,906

​

​

—

​

8,906

Vesting of restricted stock unit awards

​

40

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

—

Stock-based compensation expense

​

—

​

—

​

​

689

​

​

—

​

​

—

​

​

—

​

689

Repurchase of shares to satisfy tax obligation

​

(17)

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

—

Dividends on common stock ($0.22 per share)

​

—

​

—

​

​

—

​

​

—

​

​

(6,543)

​

​

—

​

(6,543)

Other comprehensive income (loss)

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

(1,483)

​

​

(1,483)

Balance at September 30, 2024

​

29,068,903

​

$

341

​

$

261,274

​

$

(101,633)

​

$

547,708

​

$

(40,799)

​

$

666,891

​

​

The accompanying notes are an integral part of these consolidated financial statements.

​

-4-

Table of Contents

​

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Consolidated Statements of Cash Flows

(Unaudited)

​

​	​	​	​	​	​	​
​	​	For the nine months ended September 30,
​		2025			2024
​	​	(In thousands)
Operating Activities	​	​	​	​	​	​
Net income (loss)	​	$	14,854	​	$	17,912
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:	​			​
Provision (benefit) for credit losses	​		10,043	​		3,128
Depreciation and amortization of premises and equipment	​		4,056	​		4,318
Net (loss) gain on sales of loans	​		(3,705)	​		(273)
Net amortization (accretion) of premiums and discounts	​		1,940	​		2,797
Net (gain) loss on sales of OREO	​	​	—	​	​	(174)
Impairment of goodwill	​	​	17,636	​	​	—
Deferred income tax provision (benefit)	​	​	8,934	​	​	1,969
Net loss (gain) from fair value adjustments	​	​	327	​	​	(197)
Gain from life insurance proceeds	​		—	​		(1)
Income from Bank owned life insurance	​		(6,728)	​		(3,683)
Stock-based compensation expense	​		2,348	​		2,556
Deferred compensation	​		(1,678)	​		(1,872)
Amortization of core deposit intangibles	​	​	269	​	​	317
Decrease (increase) in other assets	​		5,105	​		(16,035)
(Decrease) increase in other liabilities	​		(1,211)	​		(2,018)
Net cash provided by (used in) operating activities	​	​	52,190	​	​	8,744
Investing Activities	​			​
Purchases of premises and equipment	​		(3,277)	​		(1,620)
Purchases of Federal Home Loan Bank New York stock	​	​	(8,028)	​	​	(32,012)
Redemptions of Federal Home Loan Bank New York stock	​		27,215	​		30,333
Proceeds from prepayments of securities held-to-maturity	​		972	​		1,219
Purchases of securities available for sale	​		(340,423)	​		(934,881)
Proceeds from sales and calls of securities available for sale	​		212,830	​		83,669
Proceeds from maturities and prepayments of securities available for sale	​		138,653	​		129,724
Proceeds from sale of real estate owned	​		—	​		839
Proceeds from bank owned life insurance	​	​	1,633	​	​	14
Change in cash collateral	​		(25,850)	​		(25,130)
Net repayments (originations) of loans	​		291,546	​		206,743
Purchases of loans	​		(213,558)	​		(130,334)
Proceeds from sale of loans originally classified as held for investment	​		68,965	​		18,760
Net cash provided by (used in) investing activities	​	​	150,678	​	​	(652,676)

​

​

-5-

Table of Contents

​

​

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Consolidated Statements of Cash Flows (Contd.)

(Unaudited)

​

​	​	​	​	​	​	​
​	​	For the nine months ended September 30,
​	​	2025		​	2024
​	​	(In thousands)
Financing Activities	​	​	​	​	​	​
Net increase (decrease) in noninterest-bearing deposits	​	$	128,222	​	$	13,514
Net increase (decrease) in interest-bearing deposits	​		78,074	​		719,930
Net increase (decrease) in mortgagors' escrow deposits	​		29,615	​		22,990
Net (repayments) proceeds from short-term borrowed funds	​		(425,000)	​		(95,750)
Proceeds from long-term borrowing	​		—	​		300,000
Repayment of long-term borrowings	​		—	​		(200,000)
Repurchase of shares to satisfy tax obligations	​	​	(721)	​	​	(1,684)
Cash dividends paid	​		(22,703)	​		(19,582)
Net cash provided by (used in) financing activities	​		(212,513)	​		739,418
Net (decrease) increase in cash and cash equivalents, and restricted cash	​		(9,645)	​		95,486
Cash, cash equivalents, and restricted cash, beginning of period	​		152,574	​		172,157
Cash, cash equivalents, and restricted cash, end of period	​	$	142,929	​	$	267,643
Supplemental disclosure of cash flow information:	​			​
Cash payments for:	​	​	​	​	​	​
Interest paid	​	$	193,650	​	$	203,257
Income taxes paid, net of refunds	​		338	​		6,178
Supplemental disclosure of non- cash flow investing activities:	​	​	​	​	​	​
Transfer of loans held for investment to other real estate owned	​		—	​		665
Transfer of loans held for investment to loans held for sale	​	​	24,067	​	​	18,148
Transfer of loans held for sale to loans held for investment	​		58,781	​		—
Securities purchased not yet settled	​		70,020	​		—

​

The accompanying notes are an integral part of these consolidated financial statements.

​

​

​

​

-6-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

1.     Basis of Presentation

The primary business of Flushing Financial Corporation (the “Company”), a Delaware corporation, is the operation of its wholly owned subsidiary, Flushing Bank (the “Bank”).

The unaudited consolidated financial statements presented in this Quarterly Report on Form 10-Q (“Quarterly Report”) include the collective results of the Company and its direct and indirect wholly owned subsidiaries, including the Bank, Flushing Service Corporation and FSB Properties Inc., which are collectively herein referred to as “we,” “us,” “our” and the “Company.”

​

The Company also owns Flushing Financial Capital Trust II, Flushing Financial Capital Trust III, and Flushing Financial Capital Trust IV (the “Trusts”), which are special purpose business trusts. The Trusts are not included in the Company’s consolidated financial statements, as the Company would not absorb the losses of the Trusts if any losses were to occur.

The accompanying unaudited consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and general practices within the banking industry. The information furnished in these interim statements reflects all adjustments that are, in the opinion of management, necessary for a fair statement of the results for such periods presented of the Company. Such adjustments are of a normal recurring nature, unless otherwise disclosed in this Quarterly Report. All inter-company balances and transactions have been eliminated in consolidation. The results of operations in the interim statements are not necessarily indicative of the results that may be expected for the full year.

The accompanying unaudited consolidated financial statements have been prepared in conformity with the instructions to Quarterly Report on Form 10-Q and Article 10, Rule 10-01 of Regulation S-X for interim financial statements. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The unaudited consolidated interim financial information should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

When necessary, certain reclassifications were made to prior-year amounts to conform to the current-year presentation. Such reclassifications had no effect on the prior period net income or shareholders’ equity and were insignificant amounts.

​

2.     Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenue and expenses during the reporting period. Estimates that are particularly susceptible to change in the near term are used in connection with the determination of the allowance for credit losses, the review of the need for a valuation allowance of the Company’s deferred tax assets, and the fair value of financial instruments. For reporting periods preceding the period ended March 31, 2025, the Company considered the evaluation of goodwill for impairment as a significant estimate.

​

​

​

-7-

​

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

3.     Earnings Per Share

Earnings per common share have been computed based on the following:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

For the three months ended

​

For the nine months ended

​

​

September 30,

​

September 30,

​

​

2025

2024

2025

2024

​

(In thousands, except per share data)

Net income (loss), as reported

$

10,447

​

$

8,906

​

$

14,854

​

$

17,912

​

Less: Dividends paid and earnings allocated to participating securities

​

(167)

​

​

(126)

​

​

(381)

​

​

(296)

​

Income (loss) attributable to common stock

$

10,280

​

$

8,780

​

$

14,473

​

$

17,616

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Divided by:

​

​

​

​

Weighted average common shares and participating securities outstanding

34,497

​

29,742

​

34,495

​

29,758

​

Less: Weighted average participating securities

​

(558)

​

​

(423)

​

​

(561)

​

​

(443)

​

Total weighted average common shares outstanding

​

33,939

​

​

29,319

​

​

33,934

​

​

29,315

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Basic earnings (loss) per common share

$

0.30

​

$

0.30

​

$

0.43

​

$

0.60

​

Diluted earnings (loss) per common share (1)

$

0.30

​

$

0.30

​

$

0.43

​

$

0.60

​

Dividend Payout ratio

73.3

%

73.3

%

153.5

%

110.0

%

​

⁽¹⁾ There were no common stock equivalents outstanding during the periods presented.

​

​

​

​

4.     Securities

​

The following tables summarize the Company’s portfolio of securities held-to-maturity at:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Allowance

​

Net

​

Gross

​

Gross

​

​

​

​

​

Amortized

​

for

​

Carrying

​

Unrecognized

​

Unrecognized

​

​

​

September 30, 2025

Cost

Credit Losses

Amount

Gains

Losses

Fair Value

​

​

(In thousands)

Municipals

​

$

43,039

​

$

(351)

​

$

42,688

​

$

—

​

$

(3,492)

​

$

39,196

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

FNMA

​

7,821

​

—

​

7,821

​

—

​

(633)

​

7,188

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Total

​

$

50,860

​

$

(351)

​

$

50,509

​

$

—

​

$

(4,125)

​

$

46,384

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Allowance

​

Net

​

Gross

​

Gross

​

​

​

​

​

Amortized

​

for

​

Carrying

​

Unrecognized

​

Unrecognized

​

​

​

December 31, 2024

Cost

Credit Losses

Amount

Gains

Losses

Fair Value

​

​

(In thousands)

Municipals

​

$

44,002

​

$

(353)

​

$

43,649

​

$

—

​

$

(5,834)

​

$

37,815

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

FNMA

​

7,836

​

—

​

7,836

​

—

​

(933)

​

6,903

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Total

​

$

51,838

​

$

(353)

​

$

51,485

​

$

—

​

$

(6,767)

​

$

44,718

​

​

​

-8-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

The following tables summarize the Company’s portfolio of securities available for sale on:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Allowance

​

Gross

​

Gross

​

​

​

​

​

Amortized

​

​

for

​

Unrealized

​

Unrealized

​

​

​

September 30, 2025

Cost

Credit Losses

Gains

Losses

Fair Value

​

​

(In thousands)

U.S. government agencies

​

$

6,836

​

$

—

​

$

24

​

$

(43)

​

$

6,817

Municipals

​

​

20,627

​

​

(2,921)

​

​

—

​

​

(428)

​

​

17,278

Corporate

​

​

201,329

​

​

—

​

​

2,381

​

​

(3,580)

​

​

200,130

Mutual funds

​

12,502

​

—

​

—

​

—

​

12,502

Collateralized loan obligations

​

398,210

​

—

​

246

​

(1,521)

​

396,935

Other

​

1,491

​

—

​

—

​

—

​

1,491

Total other securities

​

640,995

​

(2,921)

​

2,651

​

(5,572)

​

635,153

REMIC and CMO

​

698,119

​

—

​

4,140

​

(326)

​

701,933

GNMA

​

42,678

​

—

​

215

​

(20)

​

42,873

FNMA

​

70,873

​

—

​

490

​

(7)

​

71,356

FHLMC

​

88,840

​

—

​

1,268

​

—

​

90,108

Total mortgage-backed securities

​

900,510

​

—

​

6,113

​

(353)

​

906,270

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Total Securities available for sale

​

$

1,541,505

​

$

(2,921)

​

$

8,764

​

$

(5,925)

​

$

1,541,423

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Allowance

​

Gross

​

Gross

​

​

​

​

​

Amortized

​

​

for

​

Unrealized

​

Unrealized

​

​

​

December 31, 2024

Cost

Credit Losses

Gains

​

Losses

Fair Value

​

​

(In thousands)

U.S. government agencies

​

$

8,804

​

$

—

​

$

77

​

$

(33)

​

$

8,848

Municipals

​

​

20,627

​

​

(2,627)

​

​

—

​

​

—

​

​

18,000

Corporate

​

​

130,882

​

​

—

​

​

735

​

​

(6,368)

​

​

125,249

Mutual funds

​

11,890

​

—

​

—

​

—

​

11,890

Collateralized loan obligations

​

420,260

​

—

​

1,126

​

(569)

​

420,817

Other

​

1,465

​

—

​

—

​

—

​

1,465

Total other securities

​

593,928

​

(2,627)

​

1,938

​

(6,970)

​

586,269

REMIC and CMO

​

707,540

​

—

​

1,107

​

(1,067)

​

707,580

GNMA

​

30,099

​

—

​

—

​

(154)

​

29,945

FNMA

​

99,183

​

—

​

11

​

(1,048)

​

98,146

FHLMC

​

76,048

​

—

​

13

​

(96)

​

75,965

Total mortgage-backed securities

​

912,870

​

—

​

1,131

​

(2,365)

​

911,636

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Total securities available for sale

​

$

1,506,798

​

$

(2,627)

​

$

3,069

​

$

(9,335)

​

$

1,497,905

​

​

Corporate securities held by the Company at September 30, 2025 and December 31, 2024, are issued by U.S. banking institutions. CMOs held by the Company at September 30, 2025 and December 31, 2024, are either fully guaranteed or issued by a government sponsored enterprise.

​

The following tables detail the amortized cost and fair value of the Company’s securities classified as held-to-maturity and available for sale at September 30, 2025, by contractual maturity. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

​

-9-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

​	​	​	​	​	​	​
​		Amortized		​	​	​
Securities held-to-maturity:		Cost			Fair Value
​		(In thousands)
Due after ten years	​	$	43,039	​	$	39,196
Total other securities	​	​	43,039	​	​	39,196
Mortgage-backed securities	​	​	7,821	​	​	7,188
Total securities held-to-maturity	​	$	50,860	​	$	46,384

​

​

​

​	​	​	​	​	​	​
​	​	Amortized		​	​	​
Securities available for sale:		Cost			Fair Value
​	​	(In thousands)
Due after one year through five years	​	$	70,359	​	$	69,312
Due after five years through ten years	​	​	191,469	​		191,305
Due after ten years	​	​	366,665	​	​	362,034
Total other securities	​		628,493	​		622,651
Mutual funds	​		12,502	​		12,502
Mortgage-backed securities	​		900,510	​		906,270
Total securities available for sale	​	$	1,541,505	​	$	1,541,423

​

​

The following tables show the Company’s securities without an allowance for credit losses with gross unrealized losses and their fair value, aggregated by category and length of time that individual securities have been in a continuous unrealized loss position, at the dates indicated:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

At September 30, 2025

​

​

​

​

Total

​

Less than 12 months

​

12 months or more

​

​

​

​

​

​

​

Unrealized

​

​

​

​

Unrealized

​

​

​

​

Unrealized

​

Count

Fair Value

Losses

Fair Value

Losses

Fair Value

Losses

​

​

(Dollars in thousands)

Held-to-maturity securities

​

​

​

​

​

​

FNMA

1

​

7,188

​

(633)

​

—

​

—

​

7,188

​

(633)

Total mortgage-backed securities

1

​

7,188

​

(633)

​

—

​

—

​

7,188

​

(633)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Total

1

​

$

7,188

​

$

(633)

​

$

—

​

$

—

​

$

7,188

​

$

(633)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Available for sale securities

​

​

​

​

​

​

U.S. government agencies

3

​

$

4,096

​

$

(43)

​

$

1,198

​

$

(11)

​

$

2,898

​

$

(32)

Corporate

13

​

96,871

​

(3,580)

​

6,234

​

(11)

​

90,637

​

(3,569)

Collateralized loan obligations

19

​

227,226

​

(1,521)

​

99,785

​

(331)

​

127,441

​

(1,190)

Total other securities

35

​

328,193

​

(5,144)

​

107,217

​

(353)

​

220,976

​

(4,791)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

REMIC and CMO

10

​

86,741

​

(326)

​

39,701

​

(119)

​

47,040

​

(207)

GNMA

1

​

15,027

​

(20)

​

15,027

​

(20)

​

—

​

—

FNMA

1

​

14,341

​

(7)

​

14,341

​

(7)

​

—

​

—

Total mortgage-backed securities

12

​

116,109

​

(353)

​

69,069

​

(146)

​

47,040

​

(207)

Total securities available for sale

47

​

$

444,302

​

$

(5,497)

​

$

176,286

​

$

(499)

​

$

268,016

​

$

(4,998)

​

​

​

​

​

​

​

-10-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

At December 31, 2024

​

​

​

​

Total

​

Less than 12 months

​

12 months or more

​

​

​

​

​

​

​

Unrealized

​

​

​

​

Unrealized

​

​

​

​

Unrealized

​

Count

Fair Value

Losses

Fair Value

Losses

Fair Value

Losses

​

​

(Dollars in thousands)

Held-to-maturity securities

​

​

​

​

​

​

FNMA

1

​

6,903

​

(933)

​

—

​

—

​

6,903

​

(933)

Total mortgage-backed securities

1

​

6,903

​

(933)

​

—

​

—

​

6,903

​

(933)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Total

1

​

$

6,903

​

$

(933)

​

$

—

​

$

—

​

$

6,903

​

$

(933)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Available for sale securities

​

​

​

​

​

​

U.S. government agencies

2

​

$

3,339

​

$

(33)

​

$

—

​

$

—

​

$

3,339

​

$

(33)

Corporate

13

​

95,758

​

(6,368)

​

—

​

—

​

95,758

​

(6,368)

Collateralized loan obligations

18

​

201,470

​

(569)

​

201,470

​

(569)

​

—

​

—

Total other securities

33

​

300,567

​

(6,970)

​

201,470

​

(569)

​

99,097

​

(6,401)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

REMIC and CMO

19

​

287,948

​

(1,067)

​

281,570

​

(936)

​

6,378

​

(131)

GNMA

4

​

29,945

​

(154)

​

28,443

​

(134)

​

1,502

​

(20)

FNMA

6

​

97,417

​

(1,048)

​

97,417

​

(1,048)

​

—

​

—

FHLMC

3

​

56,540

​

(96)

​

56,540

​

(96)

​

—

​

—

Total mortgage-backed securities

32

​

471,850

​

(2,365)

​

463,970

​

(2,214)

​

7,880

​

(151)

Total

65

​

$

772,417

​

$

(9,335)

​

$

665,440

​

$

(2,783)

​

$

106,977

​

$

(6,552)

​

The Company reviewed all available for sale securities that had an unrealized loss at September 30, 2025 and December 31, 2024. Upon this review management determined one municipal security indicated that a credit loss existed at September 30, 2025 and December 31, 2024, resulting in an allowance for credit losses being recorded. At September 30, 2025, this security was non-accrual with an amortized cost of $20.6 million, an allowance for credit losses of $2.9 million and a fair value of $17.3 million. At December 31, 2024, this security was non-accrual with an amortized cost of $20.6 million, an allowance for credit losses of $2.6 million and a fair value of $18.0 million.

​

All but one of the remaining securities held on September 30, 2025 and December 31, 2024, are either rated investment grade or better, and all these securities have a long history of no credit losses. The Bank holds approximately $10 million of corporate debt from a New York based bank holding company that at September 30, 2025 and December 31, 2024 was rated B1. We do not consider the decline in fair value to be credit related given the underlying bond has not missed any payments and financial performance has not deteriorated to a level where the institution is not well capitalized. The Bank has placed the security on the watch list and will continue to monitor this risk position closely to determine if any action steps and valuation adjustments are required in the future. It is not anticipated that this security or any other available for sale security held at September 30, 2025 and December 31, 2024 would be settled at a price that is less than the amortized cost of the Company’s investment, other than the one municipal security discussed above.

​

The Company does not have the intent to sell these securities, and it is more likely than not the Company will not be required to sell the securities before recovery of the securities’ amortized cost basis. This conclusion is based upon considering the Company’s cash and working capital requirements and contractual and regulatory obligations, none of which the Company believes would cause the sale of the securities. If the Company identifies any decline in the fair value due to credit loss factors and an evaluation indicates that a credit loss exists, then the present value of cash flows that is expected to be collected from the security is compared to the amortized cost basis of the security. If the present value of the cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses is recorded for the credit loss, limited by the amount that the fair value is less than the amortized cost basis.

​

In determining the risk of loss for available for sale securities, the Company considered that mortgage-backed securities are either fully guaranteed or issued by a government sponsored enterprise, which has a credit rating and perceived credit risk comparable to the U.S. government, and that issuers of the collateralized loan obligations (“CLO”) and the issuer of corporate securities are global systematically important banks. Each of these securities is performing according to its terms

-11-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

and, in the opinion of management, will continue to perform according to its terms. Based on this review, management believes that the unrealized losses have resulted from other factors not deemed credit-related and no allowance for credit loss was recorded.

The Company reviewed each held-to-maturity security as part of its quarterly Current Expected Credit Loss (“CECL”) process, resulting in an allowance for credit losses of $0.4 million at both September 30, 2025 and December 31, 2024.

It is the Company’s policy to exclude accrued interest receivable from the calculation of the allowance for credit losses on held-to-maturity and the valuation of available for sale securities. Accrued interest receivable on held-to-maturity securities totaled $0.1 million at both September 30, 2025 and December 31, 2024 and accrued interest receivable on available for sale debt securities totaled $8.4 million and $8.8 million at September 30, 2025 and December 31, 2024, respectively.

The following table presents the activity in the allowance for credit losses for debt securities available for sale:

​

​	​	​	​	​	​	​	​	​	​	​	​
​	For the three months ended					​	For the nine months ended
​	September 30,					​	September 30,
​	2025		​	2024		​	2025		​	2024
​	(In thousands)
Beginning balance	$	3,066	​	$	—	​	$	2,627	​	$	—
Provision (benefit)	​	(145)	​	​	—	​	​	294	​	​	—
Allowance for credit losses	$	2,921	​	$	—	​	$	2,921	​	$	—

​

The following table presents the activity in the allowance for credit losses for debt securities held-to-maturity:

​

​	​	​	​	​	​	​	​	​	​	​	​
​	For the three months ended					​	For the nine months ended
​	September 30,					​	September 30,
​	2025		​	2024		​	2025		​	2024
​	(In thousands)
Beginning balance	$	355	​	$	1,089	​	$	353	​	$	1,087
Provision (benefit)		(4)	​	​	(3)	​		(2)	​	​	(1)
Allowance for credit losses	$	351	​	$	1,086	​	$	351	​	$	1,086

​

Realized gains and losses on the sales of securities are determined using the specific identification method. During the three and nine months ended September 30, 2025, the Company sold available for sale securities with carrying values at the time of sale totaling $80.7 million at an average yield of 5.29%. During the three and nine months ended September 30, 2024, the Company did not sell any available for sale securities.

The following table represents the gross gains and gross losses realized from the sale of securities available for sale for the periods indicated:

​

The following table represents the gross gains and gross losses realized from the sale of securities available for sale for the periods indicated:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

For the three months ended

​

For the nine months ended

​

​

September 30,

​

September 30,

​

2025

2024

2025

2024

​

​

(In thousands)

Gross gains from the sale of securities

​

$

661

​

$

—

​

$

661

​

$

—

Gross losses from the sale of securities

​

—

​

—

​

—

​

—

Net gain (loss) from the sale of securities

​

$

661

​

$

—

​

$

661

​

$

—

​

​

​

-12-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

5.     Loans

The following represents the composition of loans as of the dates indicated:

​

​	​	​	​	​	​	​
​	​	September 30,		​	December 31,
​	​	2025			2024
​	​	(In thousands)
Multi-family residential	​	$	2,442,555	​	$	2,527,222
Commercial real estate	​		1,960,009	​		1,973,124
One-to-four family ― mixed-use property	​		482,933	​		511,222
One-to-four family ― residential	​		335,592	​		244,282
Construction	​		51,638	​		60,399
Small Business Administration	​		11,439	​		19,925
Commercial business and other	​		1,372,598	​		1,401,602
Net unamortized premiums and unearned loan fees	​		12,148	​		10,097
Total loans, net of fees and costs excluding portfolio layer basis adjustments	​	​	6,668,912	​	​	6,747,873
Unallocated portfolio layer basis adjustments (1)	​	​	1,421	​	​	(2,025)
Total loans, net of fees and costs	​	$	6,670,333	​	$	6,745,848

(1) This amount represents portfolio layer method basis adjustments related to loans hedged in a closed portfolio. Under GAAP portfolio layer method basis adjustments are not allocated to individual loans, however, the amounts impact the net loan balance. These basis adjustments would be allocated to the amortized cost of specific loans within the pool if the hedge was de-designated. See Note 11 (“Derivative Financial Instruments”) of the Notes to the Consolidated Financial Statements.

​

Loans are reported at their outstanding principal balance net of any unearned income, charge-offs, deferred loan fees and costs on originated loans, certain market value adjustments related to hedging and unamortized premiums or discounts on purchased loans. Net loan origination costs and premiums or discounts on loans purchased are amortized into interest income over the contractual life of the loans using the level-yield method. Prepayment penalties received on loans which pay in full prior to their scheduled maturity are included in interest income in the period they are collected.

Interest on loans is recognized on an accrual basis. Accrued interest receivable totaled $46.4 million and $46.3 million at September 30, 2025 and December 31, 2024, respectively, and was included in “Interest and dividends receivable” on the Consolidated Statements of Financial Condition. The accrual of income on loans is generally discontinued when certain factors, such as contractual delinquency of 90 days or more, indicate reasonable doubt as to the timely collectability of such income. Uncollected interest previously recognized on non-accrual loans is reversed from interest income at the time the loan is placed on non-accrual status. A non-accrual loan can be returned to accrual status when contractual delinquency returns to less than 90 days delinquent. Payments received on non-accrual loans that do not bring the loan to less than 90 days delinquent are recorded on a cash basis. Payments can also be applied first as a reduction of principal until all principal is recovered and then subsequently to interest, if in management’s opinion, it is evident that recovery of all principal due is likely to occur.

Allowance for credit losses

The allowance for credit losses (“ACL”) is an estimate that is deducted from the amortized cost basis of the financial asset to present the net carrying value at the amount expected to be collected on the financial assets. Loans are charged off against the ACL when management believes that a loan balance is uncollectable based on quarterly analysis of credit risk.

The amount of the ACL is based upon a loss rate model that considers multiple factors which reflects management’s assessment of the credit quality of the loan portfolio. Management estimates the ACL balance using relevant information, from internal and external sources, relating to past events, current conditions, and reasonable and supportable forecasts. The factors are both quantitative and qualitative in nature including, but not limited to, historical losses, economic conditions, trends in delinquencies, value and adequacy of underlying collateral, volume and portfolio mix, and internal loan processes. The Company has made a policy election to exclude accrued interest from the amortized cost basis of loans.

-13-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

The Company recorded a provision for credit losses on loans totaling $1.7 million for each of the three months ended September 30, 2025 and 2024. The Company recorded a provision for credit losses on loans totaling $9.8 million and $3.1 million for the nine months ended September 30, 2025 and 2024, respectively. The provision recorded during the three months ended September 30, 2025 was primarily driven by net charge offs and an increase in reserves applied to one Business Banking loan. The provision recorded during the nine months ended September 30, 2025, was primarily due to reserves on one commercial real estate loan which lost its primary tenant, increased reserves applied to three Business Banking loans, one Multi-Family loan and one Commercial Real Estate loan, coupled with net charges-offs. The ACL - loans totaled $41.8 million on September 30, 2025 compared to $40.2 million on December 31, 2024. On September 30, 2025, the ACL - loans represented 0.63% of gross loans and 93.3% of non-performing loans. On December 31, 2024, the ACL - loans represented 0.60% of gross loans and 120.5% of non-performing loans.

​

The Company may modify loans to enable a borrower experiencing financial difficulties to continue making payments when it is deemed to be in the Company’s best long-term interest. When modifying a loan, an assessment of whether a borrower is experiencing financial difficulty is made on the date of modification. This modification may include reducing the loan interest rate, extending the loan term, any other-than-insignificant payment delay, principal forgiveness or any combination of these types of modifications. When such modifications are performed, a change to the allowance for credit losses is generally not required as the methodologies used to estimate the allowance already capture the effect of borrowers experiencing financial difficulty. On September 30, 2025, there were no commitments to lend additional funds to borrowers who have received a loan modification due to financial difficulty.

The following table shows loan modifications made to borrowers experiencing financial difficulty by type of modification granted during the period indicated:

​

​	​	​	​	​	​	​	​	​	​
​	​	For the three and nine months ended September 30, 2025
(Dollars in thousands)	​	Other-than-insignificant Payment Delay
Loan Modifications Made to Borrowers Experiencing Financial Difficulty	​	Number	​	​	Amortized Cost Basis	​	% of Total Class of Financing Receivable		Financial Effect
Commercial business and other	​	1	​	$	2,155	​	0.2	%	Provided payment deferral through April 2026 to be collected at maturity (October 2027)
Total	​	1	​	$	2,155	​	​
​	​	​	​	​	​	​	​	​	​
​	​	For the three and nine months ended September 30, 2024
(Dollars in thousands)	​	Other-than-insignificant Payment Delay
Loan Modifications Made to Borrowers Experiencing Financial Difficulty	​	Number	​	​	Amortized Cost Basis	​	% of Total Class of Financing Receivable		Financial Effect
Commercial real estate	​	1	​	$	29,890	​	1.5	%	Provided payment deferral through April 2026 to be collected at maturity (January 2027)
Total	​	1	​	$	29,890	​	​
​	​	​	​	​	​	​	​	​	​
​	​	For the three and nine months ended September 30, 2024
(Dollars in thousands)	​	Term Extension and Other-than-insignificant Payment Delay
Loan Modifications Made to Borrowers Experiencing Financial Difficulty	​	Number	​	​	Amortized Cost Basis	​	% of Total Class of Financing Receivable		Financial Effect
Commercial real estate	​	1	​	$	2,793	​	0.1	%	Extended Maturity to January 2027 (32 months) and provided payment deferral to be collected at maturity
Total	​	1	​	$	2,793	​	​

-14-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

​

​	​	​	​	​	​	​	​	​	​
​	​	For the nine months ended September 30, 2025
(Dollars in thousands)	​	Rate Reduction and Other-than-insignificant Payment Delay
Loan Modifications Made to Borrowers Experiencing Financial Difficulty		Number		Amortized Cost Basis			% of Total Class of Financing Receivable		Financial Effect
Commercial real estate	​	1	​	$	8,400	​	0.4	%	Borrower to make interest only payments to December 2026 (18 months) and rate reduced to 6.00% from 7.22%
Total	​	1	​	$	8,400	​	​
​	​	​	​	​	​	​	​	​	​
​	​	For the nine months ended September 30, 2024
(Dollars in thousands)	​	Term Extension and Reduced Interest Rate
Loan Modifications Made to Borrowers Experiencing Financial Difficulty		Number		Amortized Cost Basis			% of Total Class of Financing Receivable		Financial Effect
Commercial business and other	​	1	​	$	378	​	—	%	Extended Maturity to August 2026 (3 months) and reduced the interest rate to zero percent
Total	​	1	​	$	378	​	​

​

​

The following table shows the payment status at September 30, 2025, of borrowers experiencing financial difficulty for which a modification was granted within the last 12 months:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Payment Status of Borrowers Experiencing Financial Difficulty (Amortized Cost Basis)

(In thousands)

​

Current

​

30-89 Days Past Due

​

90+ Days Past Due

Total Modified

Multi-family residential

​

$

7,473

​

$

—

​

$

—

​

$

7,473

Commercial real estate

​

​

41,081

​

​

—

​

​

—

​

​

41,081

Commercial business and other

​

​

2,162

​

​

—

​

​

—

​

​

2,162

Total

​

$

50,716

​

$

—

​

$

—

​

$

50,716

​

-15-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

The following tables show our non-accrual loans at amortized cost with no related allowance and interest income recognized for loans ninety days or more past due and still accruing for the periods shown below:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

At or for the nine months ended September 30, 2025

(In thousands)

​

​

Non-accrual amortized cost beginning of the reporting period

​

​

Non-accrual amortized cost end of the reporting period

​

​

Non-accrual with no related allowance

​

​

Interest income recognized

​

​

Loans ninety days or more past due and still accruing

Multi-family residential

​

$

11,707

​

$

14,531

​

$

9,952

​

$

53

​

$

—

Commercial real estate

​

​

6,376

​

​

22,011

​

​

5,101

​

​

20

​

​

—

One-to-four family - mixed-use property

​

​

117

​

​

—

​

​

—

​

​

6

​

​

—

One-to-four family - residential

​

​

812

​

​

750

​

​

750

​

​

3

​

​

—

Small Business Administration

​

​

2,531

​

​

558

​

​

558

​

​

366

​

​

—

Commercial business and other

​

​

12,454

​

​

8,841

​

​

4,272

​

​

145

​

​

—

Total

​

$

33,997

​

$

46,691

​

$

20,633

​

$

593

​

$

—

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

At or for the year ended December 31, 2024

(In thousands)

​

​

Non-accrual amortized cost beginning of the reporting period

​

​

Non-accrual amortized cost end of the reporting period

​

​

Non-accrual with no related allowance

​

​

Interest income recognized

​

​

Loans ninety days or more past due and still accruing

Multi-family residential

​

$

3,640

​

$

11,707

​

$

6,476

​

$

5

​

$

—

Commercial real estate

​

​

—

​

​

6,376

​

​

6,376

​

​

—

​

​

—

One-to-four family - mixed-use property

​

​

1,005

​

​

117

​

​

117

​

​

1

​

​

—

One-to-four family - residential

​

​

4,670

​

​

812

​

​

812

​

​

2

​

​

—

Small Business Administration

​

​

2,576

​

​

2,531

​

​

2,531

​

​

—

​

​

—

Commercial business and other

​

​

11,768

​

​

12,454

​

​

6,046

​

​

3

​

​

—

Total

​

$

23,659

​

$

33,997

​

$

22,358

​

$

11

​

$

—

​

​

​

​

​

​

​

​

-16-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

The following is a summary of interest foregone on non-accrual loans for the periods indicated.

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

For the three months ended

​

For the nine months ended

​

​

​

September 30,

​

September 30,

​

​

2025

2024

2025

2024

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

(In thousands)

​

​

​

​

​

​

​

​

​

​

​

​

​

Interest income that would have been recognized had the loans performed in accordance with their original terms

​

$

877

​

$

900

​

$

2,660

​

$

2,246

​

Less: Interest income included in the results of operations

​

(410)

​

(5)

​

(593)

​

(10)

​

Total foregone interest

​

$

467

​

$

895

​

$

2,067

​

$

2,236

​

​

​

The following tables show the aging analysis of the amortized cost basis of loans at the period indicated by class of loans:
​

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	At September 30, 2025
(In thousands)		30 - 59 Days Past Due			60 - 89 Days Past Due			Greater than 90 Days			Total Past Due			Current			Total Loans (1)
Multi-family residential	​	$	4,505	​	$	—	​	$	14,531	​	$	19,036	​	$	2,429,150	​	$	2,448,186
Commercial real estate	​		1,479	​		—	​		22,011	​		23,490	​		1,938,343	​		1,961,833
One-to-four family - mixed-use property	​		948	​		—	​		—	​		948	​		484,418	​		485,366
One-to-four family - residential	​		1,339	​		113	​		750	​		2,202	​		334,303	​		336,505
Construction	​		—	​		—	​		—	​		—	​		51,527	​		51,527
Small Business Administration	​		172	​		—	​		558	​		730	​		10,826	​		11,556
Commercial business and other	​		2,132	​		1,708	​		7,134	​		10,974	​		1,362,965	​		1,373,939
Total	​	$	10,575	​	$	1,821	​	$	44,984	​	$	57,380	​	$	6,611,532	​	$	6,668,912

(1) The table above excludes the unallocated portfolio layer basis adjustments totaling $1.4 million related to loans hedged in a closed pool. See Note 11 (“Derivative Financial Instruments”) of the Notes to the Consolidated Financial Statements.

​

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	At December 31, 2024
(In thousands)		30 - 59 Days Past Due			60 - 89 Days Past Due			Greater than 90 Days			Total Past Due			Current			Total Loans (1)
Multi-family residential	​	$	12,596	​	$	9,255	​	$	11,707	​	$	33,558	​	$	2,498,055	​	$	2,531,613
Commercial real estate	​		4,846	​		—	​		6,376	​		11,222	​		1,963,400	​		1,974,622
One-to-four family - mixed-use property	​		870	​		1,234	​		117	​		2,221	​		511,717	​		513,938
One-to-four family - residential	​		802	​		65	​		812	​		1,679	​		242,914	​		244,593
Construction	​		—	​		—	​		—	​		—	​		60,114	​		60,114
Small Business Administration	​		—	​		—	​		2,531	​		2,531	​		17,664	​		20,195
Commercial business and other	​		409	​		2,239	​		12,432	​		15,080	​		1,387,718	​		1,402,798
Total	​	$	19,523	​	$	12,793	​	$	33,975	​	$	66,291	​	$	6,681,582	​	$	6,747,873

​

(1) The table above excludes the unallocated portfolio layer basis adjustments totaling ($2.0) million related to loans hedged in a closed pool. See Note 11 (“Derivative Financial Instruments”) of the Notes to the Consolidated Financial Statements.

​

​

​

-17-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

The following tables show the activity in the ACL on loans for the three-month periods ended:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

September 30, 2025

​

​

​

​

​

One-to-four

One-to-four

​

​

​

​

Commercial

​

​

​

​

Multi-family

​

Commercial

​

family - mixed-

​

family -

​

Construction

​

Small Business

​

business and

​

​

​

(In thousands)

​

residential

​

real estate

​

use property

​

residential

​

loans

​

Administration

​

other

​

Total

Beginning balance

​

$

12,445

​

$

13,211

​

$

1,678

​

$

858

​

$

132

​

$

1,366

​

$

11,557

​

$

41,247

Charge-offs

​

(420)

​

​

(1,275)

​

​

(20)

​

​

—

​

​

—

​

​

(277)

​

​

(32)

​

​

(2,024)

Recoveries

​

—

​

—

​

—

​

48

​

—

​

6

​

​

880

​

​

934

Provision (benefit)

​

(50)

​

1,118

​

(102)

​

225

​

19

​

(47)

​

​

517

​

​

1,680

Ending balance

​

$

11,975

​

$

13,054

​

$

1,556

​

$

1,131

​

$

151

​

$

1,048

​

$

12,922

​

$

41,837

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

September 30, 2024

​

​

​

​

​

One-to-four

One-to-four

​

​

​

​

Commercial

​

​

​

​

Multi-family

​

Commercial

​

family - mixed-

​

family -

​

Construction

​

Small Business

​

business and

​

​

​

(In thousands)

​

residential

​

real estate

​

use property

​

residential

​

loans

​

Administration

​

other

​

Total

Beginning balance

​

$

10,829

​

$

9,043

​

$

1,577

​

$

796

​

$

766

​

$

1,126

​

$

17,511

​

$

41,648

Charge-offs

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

(7)

​

​

(3,103)

​

​

(3,110)

Recoveries

​

—

​

—

​

—

​

58

​

—

​

8

​

​

8

​

​

74

Provision (benefit)

​

457

​

90

​

(46)

​

(46)

​

(130)

​

302

​

​

1,103

​

​

1,730

Ending balance

​

$

11,286

​

$

9,133

​

$

1,531

​

$

808

​

$

636

​

$

1,429

​

$

15,519

​

$

40,342

​

​

​

​

​

The following tables show the activity in the ACL on loans for the nine-month periods ended:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

September 30, 2025

​

​

​

​

​

One-to-four

One-to-four

​

​

​

​

Commercial

​

​

​

​

Multi-family

​

Commercial

​

family - mixed-

​

family -

​

Construction

​

Small Business

​

business and

​

​

​

(In thousands)

​

residential

​

real estate

​

use property

​

residential

​

loans

​

Administration

​

other

​

Total

Beginning balance

​

$

13,145

​

$

9,288

​

$

1,623

​

$

759

​

$

371

​

$

1,523

​

$

13,443

​

$

40,152

Charge-offs

​

(2,101)

​

(1,347)

​

(20)

​

(5)

​

—

​

(279)

​

(5,600)

​

(9,352)

Recoveries

​

—

​

—

​

—

​

53

​

—

​

52

​

1,181

​

1,286

Provision (benefit)

​

931

​

5,113

​

(47)

​

324

​

(220)

​

(248)

​

3,898

​

9,751

Ending balance

​

$

11,975

​

$

13,054

​

$

1,556

​

$

1,131

​

$

151

​

$

1,048

​

$

12,922

​

$

41,837

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

September 30, 2024

​

​

​

​

​

One-to-four

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

family -

​

One-to-four

​

​

​

​

​

​

​

Commercial

​

​

​

​

​

Multi-family

​

Commercial

​

mixed-use

​

family -

​

Construction

​

Small Business

​

business and

​

​

​

(In thousands)

​

residential

​

real estate

​

property

​

residential

​

loans

​

Administration

​

other

​

Total

Allowance for credit losses:

​

​

​

​

​

​

​

​

Beginning balance

​

$

10,373

​

$

8,665

​

$

1,610

​

$

668

​

$

158

​

$

1,626

​

$

17,061

​

$

40,161

Charge-offs

​

—

​

—

​

—

​

(14)

​

—

​

(7)

​

(3,158)

​

(3,179)

Recoveries

​

1

​

—

​

2

​

61

​

—

​

104

​

63

​

231

Provision (benefit)

​

912

​

468

​

(81)

​

93

​

478

​

(294)

​

1,553

​

3,129

Ending balance

​

$

11,286

​

$

9,133

​

$

1,531

​

$

808

​

$

636

​

$

1,429

​

$

15,519

​

$

40,342

​

In accordance with our policy and the current regulatory guidelines, we designate loans as “Special Mention,” which are considered “Criticized Loans,” and “Substandard,” “Doubtful,” or “Loss,” which are considered “Classified Loans.” If a loan does not fall within one of the previously mentioned categories and management believes weakness is evident then we designate the loan as “Watch;” all other loans would be considered “Pass.” Loans that are non-accrual are designated as Substandard, Doubtful or Loss. These loan designations are updated quarterly. We designate a loan as Substandard when a well-defined weakness is identified that may jeopardize the orderly liquidation of the debt. We designate a loan as Doubtful when it displays the inherent weakness of a Substandard loan with the added provision that collection of the debt in full, on the basis of existing facts, is highly improbable. We designate a loan as Loss if it is deemed the debtor is incapable of repayment. The Company does not hold any loans designated as Loss, as loans that are designated as Loss are charged to the Allowance for Credit Losses. We designate a loan as Special Mention if the asset does not warrant classification within one of the other classifications but does contain a potential weakness that deserves closer attention.

​

-18-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

The following tables summarize the various risk categories of mortgage and non-mortgage loans by loan portfolio segments and by class of loans by year of origination at the periods indicated below:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

September 30, 2025

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Revolving Loans

​

​

Revolving Loans

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Amortized Cost

​

​

converted to

​

​

​

(In thousands)

​

​

2025

​

​

2024

​

​

2023

​

​

2022

​

​

2021

​

​

Prior

​

​

Basis

​

​

term loans

​

​

Total

Multi-family Residential

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

54,086

​

$

114,940

​

$

227,745

​

$

404,123

​

$

265,416

​

$

1,328,924

​

$

3,219

​

$

—

​

$

2,398,453

Watch

​

​

—

​

​

927

​

​

897

​

​

3,742

​

​

2,505

​

​

25,515

​

​

—

​

​

—

​

​

33,586

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

810

​

​

—

​

​

—

​

​

810

Substandard

​

​

—

​

​

—

​

​

—

​

​

812

​

​

—

​

​

14,525

​

​

—

​

​

—

​

​

15,337

Total Multi-family Residential

​

$

54,086

​

$

115,867

​

$

228,642

​

$

408,677

​

$

267,921

​

$

1,369,774

​

$

3,219

​

$

—

​

$

2,448,186

Gross charge-offs

​

$

—

​

$

—

​

$

—

​

$

1,681

​

$

—

​

$

420

​

$

—

​

$

—

​

$

2,101

Commercial Real Estate

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

142,137

​

$

191,071

​

$

189,208

​

$

297,745

​

$

135,897

​

$

900,702

​

$

—

​

$

—

​

$

1,856,760

Watch

​

​

—

​

​

1,983

​

​

3,987

​

​

422

​

​

7,405

​

​

60,865

​

​

—

​

​

—

​

​

74,662

Special Mention

​

​

8,400

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

8,400

Substandard

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

22,011

​

​

—

​

​

—

​

​

22,011

Total Commercial Real Estate

​

$

150,537

​

$

193,054

​

$

193,195

​

$

298,167

​

$

143,302

​

$

983,578

​

$

—

​

$

—

​

$

1,961,833

Gross charge-offs

​

$

—

​

$

—

​

$

—

​

$

—

​

$

—

​

$

1,347

​

$

—

​

$

—

​

$

1,347

1-4 Family Mixed-Use Property

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

9,196

​

$

17,605

​

$

21,750

​

$

43,910

​

$

37,581

​

$

347,762

​

$

—

​

$

—

​

$

477,804

Watch

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

6,030

​

​

—

​

​

—

​

​

6,030

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

1,193

​

​

—

​

​

—

​

​

1,193

Substandard

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

339

​

​

—

​

​

—

​

​

339

Total 1-4 Family Mixed-Use Property

​

$

9,196

​

$

17,605

​

$

21,750

​

$

43,910

​

$

37,581

​

$

355,324

​

$

—

​

$

—

​

$

485,366

Gross charge-offs

​

$

—

​

$

—

​

$

—

​

$

—

​

$

—

​

$

20

​

$

—

​

$

—

​

$

20

1-4 Family Residential

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

2,022

​

$

17,055

​

$

111,596

​

$

54,252

​

$

5,776

​

$

126,245

​

$

5,327

​

$

7,660

​

$

329,933

Watch

​

​

—

​

​

—

​

​

—

​

​

488

​

​

—

​

​

2,062

​

​

—

​

​

1,509

​

​

4,059

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

1,706

​

​

—

​

​

58

​

​

1,764

Substandard

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

247

​

​

—

​

​

502

​

​

749

Total 1-4 Family Residential

​

$

2,022

​

$

17,055

​

$

111,596

​

$

54,740

​

$

5,776

​

$

130,260

​

$

5,327

​

$

9,729

​

$

336,505

Gross charge-offs

​

$

—

​

$

—

​

$

—

​

$

—

​

$

—

​

$

5

​

$

—

​

$

—

​

$

5

Construction

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

1,633

​

$

—

​

$

—

​

$

—

​

$

—

​

$

—

​

$

31,644

​

$

—

​

$

33,277

Watch

​

​

—

​

​

—

​

​

—

​

​

—

​

​

18,250

​

​

—

​

​

—

​

​

—

​

​

18,250

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

Total Construction

​

$

1,633

​

$

—

​

$

—

​

$

—

​

$

18,250

​

$

—

​

$

31,644

​

$

—

​

$

51,527

Small Business Administration

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

1,331

​

$

1,641

​

$

1,136

​

$

3,154

​

$

931

​

$

2,240

​

$

—

​

$

—

​

$

10,433

Watch

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

196

​

​

—

​

​

—

​

​

196

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

27

​

​

—

​

​

—

​

​

27

Substandard

​

​

—

​

​

—

​

​

—

​

​

—

​

​

1

​

​

899

​

​

—

​

​

—

​

​

900

Total Small Business Administration

​

$

1,331

​

$

1,641

​

$

1,136

​

$

3,154

​

$

932

​

$

3,362

​

$

—

​

$

—

​

$

11,556

Gross charge-offs

​

$

—

​

$

—

​

$

—

​

$

—

​

$

—

​

$

279

​

$

—

​

$

—

​

$

279

Commercial Business

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

71,720

​

$

73,875

​

$

74,852

​

$

61,012

​

$

20,797

​

$

82,540

​

$

172,861

​

$

—

​

$

557,657

Watch

​

​

75

​

​

3,048

​

​

—

​

​

—

​

​

2,456

​

​

6,918

​

​

3,568

​

​

—

​

​

16,065

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

1,545

​

​

8

​

​

—

​

​

—

​

​

1,553

Substandard

​

​

—

​

​

660

​

​

317

​

​

2,155

​

​

—

​

​

77

​

​

13,334

​

​

—

​

​

16,543

Doubtful

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

1,708

​

​

—

​

​

—

​

​

1,708

Total Commercial Business

​

$

71,795

​

$

77,583

​

$

75,169

​

$

63,167

​

$

24,798

​

$

91,251

​

$

189,763

​

$

—

​

$

593,526

Gross charge-offs

​

$

—

​

$

—

​

$

871

​

$

2,621

​

$

—

​

$

1,952

​

$

95

​

$

—

​

$

5,539

Commercial Business - Secured by RE

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

67,469

​

$

68,182

​

$

55,257

​

$

163,746

​

$

106,252

​

$

281,422

​

$

—

​

$

—

​

$

742,328

Watch

​

​

—

​

​

8,578

​

​

—

​

​

—

​

​

8,415

​

​

18,161

​

​

—

​

​

—

​

​

35,154

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

Substandard

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

2,800

​

​

—

​

​

—

​

​

2,800

Total Commercial Business - Secured by RE

​

$

67,469

​

$

76,760

​

$

55,257

​

$

163,746

​

$

114,667

​

$

302,383

​

$

—

​

$

—

​

$

780,282

Other

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

—

​

$

—

​

$

—

​

$

—

​

$

—

​

$

54

​

$

77

​

$

—

​

$

131

Total Other

​

$

—

​

$

—

​

$

—

​

$

—

​

$

—

​

$

54

​

$

77

​

$

—

​

$

131

Gross charge-offs

​

$

—

​

$

—

​

$

—

​

$

—

​

$

—

​

$

61

​

$

—

​

$

—

​

$

61

Total by Loan Type

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Total Pass

​

$

349,594

​

$

484,369

​

$

681,544

​

$

1,027,942

​

$

572,650

​

$

3,069,889

​

$

213,128

​

$

7,660

​

$

6,406,776

Total Watch

​

​

75

​

​

14,536

​

​

4,884

​

​

4,652

​

​

39,031

​

​

119,747

​

​

3,568

​

​

1,509

​

​

188,002

Total Special Mention

​

​

8,400

​

​

—

​

​

—

​

​

—

​

​

1,545

​

​

3,744

​

​

—

​

​

58

​

​

13,747

Total Substandard

​

​

—

​

​

660

​

​

317

​

​

2,967

​

​

1

​

​

40,898

​

​

13,334

​

​

502

​

​

58,679

Total Doubtful

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

1,708

​

​

—

​

​

—

​

​

1,708

Total Loans (1)

​

$

358,069

​

$

499,565

​

$

686,745

​

$

1,035,561

​

$

613,227

​

$

3,235,986

​

$

230,030

​

$

9,729

​

$

6,668,912

Total Gross charge-offs

​

$

—

​

$

—

​

$

871

​

$

4,302

​

$

—

​

$

4,084

​

$

95

​

$

—

​

$

9,352

⁽¹⁾ The table above excludes the unallocated portfolio layer basis adjustments totaling $1.4 million related to loans hedged in a closed pool at September 30, 2025. See Note 11 (“Derivative Financial Instruments”) of the Notes to the Consolidated Financial Statements.

-19-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

December 31, 2024

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Revolving Loans

​

​

Revolving Loans

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Amortized Cost

​

​

converted to

​

​

​

(In thousands)

​

​

2024

​

​

2023

​

​

2022

​

​

2021

​

​

2020

​

​

Prior

​

​

Basis

​

​

term loans

​

​

Total

Multi-family Residential

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

116,814

​

$

248,004

​

$

375,084

​

$

272,747

​

$

195,539

​

$

1,250,368

​

$

5,369

​

$

—

​

$

2,463,925

Watch

​

​

—

​

​

—

​

​

7,587

​

​

—

​

​

2,724

​

​

31,665

​

​

—

​

​

—

​

​

41,976

Special Mention

​

​

—

​

​

—

​

​

10,163

​

​

—

​

​

—

​

​

2,388

​

​

—

​

​

—

​

​

12,551

Substandard

​

​

—

​

​

—

​

​

—

​

​

704

​

​

2,811

​

​

9,646

​

​

—

​

​

—

​

​

13,161

Total Multi-family Residential

​

$

116,814

​

$

248,004

​

$

392,834

​

$

273,451

​

$

201,074

​

$

1,294,067

​

$

5,369

​

$

—

​

$

2,531,613

Commercial Real Estate

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

199,396

​

$

197,228

​

$

310,725

​

$

144,569

​

$

122,576

​

$

924,520

​

$

—

​

$

—

​

$

1,899,014

Watch

​

​

—

​

​

—

​

​

430

​

​

4,023

​

​

6,660

​

​

58,119

​

​

—

​

​

—

​

​

69,232

Substandard

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

6,376

​

​

—

​

​

—

​

​

6,376

Total Commercial Real Estate

​

$

199,396

​

$

197,228

​

$

311,155

​

$

148,592

​

$

129,236

​

$

989,015

​

$

—

​

$

—

​

$

1,974,622

Gross charge-offs

​

$

—

​

$

—

​

$

—

​

$

—

​

$

—

​

$

421

​

$

—

​

$

—

​

$

421

1-4 Family Mixed-Use Property

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

17,759

​

$

23,552

​

$

45,487

​

$

40,515

​

$

27,448

​

$

352,004

​

$

—

​

$

—

​

$

506,765

Watch

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

5,338

​

​

—

​

​

—

​

​

5,338

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

445

​

​

1,273

​

​

—

​

​

—

​

​

1,718

Substandard

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

117

​

​

—

​

​

—

​

​

117

Total 1-4 Family Mixed-Use Property

​

$

17,759

​

$

23,552

​

$

45,487

​

$

40,515

​

$

27,893

​

$

358,732

​

$

—

​

$

—

​

$

513,938

1-4 Family Residential

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

2,136

​

$

53,556

​

$

22,382

​

$

7,117

​

$

16,039

​

$

121,653

​

$

6,256

​

$

8,588

​

$

237,727

Watch

​

​

—

​

​

—

​

​

496

​

​

254

​

​

—

​

​

2,769

​

​

113

​

​

1,265

​

​

4,897

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

838

​

​

—

​

​

215

​

​

1,053

Substandard

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

477

​

​

—

​

​

439

​

​

916

Total 1-4 Family Residential

​

$

2,136

​

$

53,556

​

$

22,878

​

$

7,371

​

$

16,039

​

$

125,737

​

$

6,369

​

$

10,507

​

$

244,593

Gross charge-offs

​

$

—

​

$

—

​

$

—

​

$

—

​

$

—

​

$

14

​

$

—

​

$

—

​

$

14

Construction

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

—

​

$

51

​

$

2

​

$

18,215

​

$

—

​

$

—

​

$

39,230

​

$

—

​

$

57,498

Watch

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

Special Mention

​

​

—

​

​

2,616

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

2,616

Total Construction

​

$

—

​

$

2,667

​

$

2

​

$

18,215

​

$

—

​

$

—

​

$

39,230

​

$

—

​

$

60,114

Small Business Administration

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

7,356

​

$

1,906

​

$

3,211

​

$

1,092

​

$

1,672

​

$

1,123

​

$

—

​

$

—

​

$

16,360

Watch

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

774

​

​

—

​

​

—

​

​

774

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

325

​

​

—

​

​

—

​

​

325

Substandard

​

​

—

​

​

—

​

​

—

​

​

1,691

​

​

—

​

​

1,045

​

​

—

​

​

—

​

​

2,736

Total Small Business Administration

​

$

7,356

​

$

1,906

​

$

3,211

​

$

2,783

​

$

1,672

​

$

3,267

​

$

—

​

$

—

​

$

20,195

Gross charge-offs

​

$

—

​

$

—

​

$

—

​

$

—

​

$

—

​

$

7

​

$

—

​

$

—

​

$

7

Commercial Business

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

109,139

​

$

92,916

​

$

71,479

​

$

29,665

​

$

17,744

​

$

99,620

​

$

208,419

​

$

—

​

$

628,982

Watch

​

​

166

​

​

4,850

​

​

—

​

​

1,630

​

​

4,310

​

​

1,720

​

​

1,500

​

​

—

​

​

14,176

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

16

​

​

—

​

​

—

​

​

16

Substandard

​

​

716

​

​

429

​

​

4,891

​

​

—

​

​

—

​

​

3,119

​

​

3,856

​

​

—

​

​

13,011

Doubtful

​

​

—

​

​

462

​

​

—

​

​

—

​

​

—

​

​

—

​

​

570

​

​

—

​

​

1,032

Total Commercial Business

​

$

110,021

​

$

98,657

​

$

76,370

​

$

31,295

​

$

22,054

​

$

104,475

​

$

214,345

​

$

—

​

$

657,217

Gross charge-offs

​

$

—

​

$

—

​

$

—

​

$

4,121

​

$

—

​

$

266

​

$

3,083

​

$

—

​

$

7,470

Commercial Business - Secured by RE

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

68,613

​

$

45,976

​

$

169,904

​

$

125,523

​

$

99,794

​

$

203,839

​

$

673

​

$

—

​

$

714,322

Watch

​

​

8,671

​

​

—

​

​

—

​

​

—

​

​

3,721

​

​

396

​

​

—

​

​

—

​

​

12,788

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

14,418

​

​

—

​

​

—

​

​

14,418

Substandard

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

3,884

​

​

—

​

​

—

​

​

3,884

Total Commercial Business - Secured by RE

​

$

77,284

​

$

45,976

​

$

169,904

​

$

125,523

​

$

103,515

​

$

222,537

​

$

673

​

$

—

​

$

745,412

Other

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

—

​

$

—

​

$

—

​

$

—

​

$

—

​

$

85

​

$

84

​

$

—

​

$

169

Total Other

​

$

—

​

$

—

​

$

—

​

$

—

​

$

—

​

$

85

​

$

84

​

$

—

​

$

169

Gross charge-offs

​

$

—

​

$

—

​

$

—

​

$

—

​

$

—

​

$

57

​

$

—

​

$

—

​

$

57

Total by Loan Type

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Total Pass

​

$

521,213

​

$

663,189

​

$

998,274

​

$

639,443

​

$

480,812

​

$

2,953,212

​

$

260,031

​

$

8,588

​

$

6,524,762

Total Watch

​

​

8,837

​

​

4,850

​

​

8,513

​

​

5,907

​

​

17,415

​

​

100,781

​

​

1,613

​

​

1,265

​

​

149,181

Total Special Mention

​

​

—

​

​

2,616

​

​

10,163

​

​

—

​

​

445

​

​

19,258

​

​

—

​

​

215

​

​

32,697

Total Substandard

​

​

716

​

​

429

​

​

4,891

​

​

2,395

​

​

2,811

​

​

24,664

​

​

3,856

​

​

439

​

​

40,201

Total Doubtful

​

​

—

​

​

462

​

​

—

​

​

—

​

​

—

​

​

—

​

​

570

​

​

—

​

​

1,032

Total Loans (1)

​

$

530,766

​

$

671,546

​

$

1,021,841

​

$

647,745

​

$

501,483

​

$

3,097,915

​

$

266,070

​

$

10,507

​

$

6,747,873

Total Gross charge-offs

​

$

—

​

$

—

​

$

—

​

$

4,121

​

$

—

​

$

765

​

$

3,083

​

$

—

​

$

7,969

⁽¹⁾ The table above excludes the unallocated portfolio layer basis adjustments totaling ($2.0) million related to loans hedged in a closed pool at December 31, 2024. See Note 11 (“Derivative Financial Instruments”) of the Notes to the Consolidated Financial Statements.

​

-20-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

Included within net loans were $1.3 million and $2.7 million at September 30, 2025 and December 31, 2024, respectively, of consumer mortgage loans secured by residential real estate properties for which formal foreclosure proceedings were in process according to local requirements of the applicable jurisdiction.

A loan is considered collateral dependent when the borrower is experiencing financial difficulties and repayment is expected to be substantially provided by the operation or sale of the collateral. The following table presents types of collateral-dependent loans by class of loans as of the periods indicated:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Collateral Type

​

​

September 30, 2025

​

December 31, 2024

(In thousands)

​

​

Real Estate

​

​

Business Assets

​

​

Real Estate

​

​

Business Assets

Multi-family residential

​

$

14,531

​

$

—

​

$

11,707

​

$

—

Commercial real estate

​

​

22,011

​

​

—

​

​

6,376

​

​

—

One-to-four family - mixed-use property

​

​

—

​

​

—

​

​

117

​

​

—

One-to-four family - residential

​

​

750

​

​

—

​

​

812

​

​

—

Small Business Administration

​

​

—

​

​

558

​

​

—

​

​

2,531

Commercial business and other

​

​

2,800

​

​

6,041

​

​

3,884

​

​

8,570

Total

​

$

40,092

​

$

6,599

​

$

22,896

​

$

11,101

​

Off-Balance Sheet Credit Losses

​

Also included within scope of the CECL standard are off-balance sheet loan commitments, which includes the unfunded portion of committed lines of credit and commitments “in-process”. Commitments “in‐process” reflect loans not in the Company’s books but rather negotiated loan / line of credit terms and rates that the Company has offered to customers and is committed to honoring. In reference to “in‐process” credits, the Company defines an unfunded commitment as a credit that has been offered to and accepted by a borrower, which has not closed and by which the obligation is not unconditionally cancellable.

​

On September 30, 2025, the Company had commitments to extend credit totaling $391.1 million.

​

The following table presents the activity in the allowance for off-balance sheet credit losses for the three months ended:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

For the three months ended

​

For the nine months ended

​

​

September 30,

​

September 30,

(In thousands)

​

​

2025

​

​

2024

​

​

2025

​

​

2024

Balance at beginning of period

​

$

976

​

​

1,002

​

$

1,037

​

​

1,102

Provision (benefit) (1)

​

​

61

​

​

56

​

​

—

​

​

(44)

Allowance for off-balance sheet - credit losses (2)

​

$

1,037

​

$

1,058

​

$

1,037

​

$

1,058

(1) Included in “Other operating expenses” on the Consolidated Statements of Operations.

(2) Included in “Other liabilities” on the Consolidated Statements of Financial Condition.

​

​

​

​

-21-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

​

6.     Loans held for sale

Loans held for sale are carried at the lower of cost or estimated fair value. At September 30, 2025, the Company did not have any loans designated as held for sale. At December 31, 2024, the Company had $70.1 million in performing multi-family loans held for sale.

The Company has implemented a strategy of selling certain delinquent and non-performing loans. Once the Company has decided to sell a loan, the sale usually closes in a short period of time, generally within the same quarter. Loans designated held for sale are reclassified from loans held for investment to loans held for sale. Terms of sale generally includes cash due upon the closing of the sale, no contingencies or recourse to the Company and servicing is released to the buyer.

The following tables show loans sold during the periods indicated:

​

​	​	​	​	​	​	​	​	​	​	​	​
​	​	For the three months ended September 30, 2025
(Dollars in thousands)		Loans sold		Proceeds			Net charge-offs			Net gain
Performing loans		​
Small Business Administration	​	2	​	$	1,820	​	$	—	​	$	270
Total		2	​	$	1,820	​	$	—	​	$	270
Delinquent and non-performing loans	​	​	​	​	​	​	​	​	​	​	​
Multi-family residential		5	​	$	3,425	​	$	—	​	$	48
One-to-four family - mixed-use property		3	​	​	1,371	​	​	(20)	​	​	—
Total		8	​	$	4,796	​	$	(20)	​	$	48

​

​	​	​	​	​	​	​	​	​	​	​	​
​	​	For the three months ended September 30, 2024
(Dollars in thousands)		Loans sold		Proceeds			Net charge-offs			Net gain
Performing loans		​
Multi-family residential		1	​	$	2,446	​	$	—	​	$	—
Commercial		1	​	​	5,875	​	​	—	​	​	—
Total		2	​	$	8,321	​	$	—	​	$	—
Delinquent and non-performing loans			​			​			​
Multi-family residential	​	1	​	S	989	​	$	—	​	$	—
Commercial		1	​	​	2,827	​	​	—	​	​	—
One-to-four family - mixed-use property		1	​	​	900	​	​	—	​	​	113
One-to-four family - residential		1	​	​	1,223	​	​	—	​	​	24
Total		4	​	$	5,939	​	$	—	​	$	137

​

​

-22-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

​

​	​	​	​	​	​	​	​	​	​	​	​
​	​	For the nine months ended September 30, 2025
(Dollars in thousands)		Loans sold		Proceeds			Net charge-offs			Net gain (1)
Performing loans		​
Multi-family residential		12	​	$	33,721	​	$	—	​	$	—
Commercial		1	​	​	3,120	​	​	—	​	​	—
Small Business Administration	​	8	​	​	8,648	​	​	—	​	​	802
Total		21	​	$	45,489	​	$	—	​	$	802
Delinquent and non-performing loans	​	​	​	​	​	​	​	​	​	​	​
Multi-family residential		10	​	$	16,869	​	$	(1,681)	​	$	250
Commercial		1	​	​	5,098	​	​	—	​	​	238
One-to-four family - mixed-use property		4	​	​	1,508	​	​	(20)	​	​	19
Total		15	​	$	23,475	​	$	(1,701)	​	$	507
​	​	​	​	​	​	​	​	​	​	​	​
​	​	For the nine months ended September 30, 2024
(Dollars in thousands)		Loans sold		Proceeds			Net charge-offs			Net gain
Performing loans			​			​			​
Multi-family residential		1	​	$	2,446	​	$	—	​	$	—
Commercial		1	​	​	5,875	​	​	—	​	​	—
Total		2	​	$	8,321	​	$	—	​	$	—
Delinquent and non-performing loans		​
Multi-family residential	​	5	​	S	2,973	​	$	—	​	$	55
Commercial		3	​	​	3,797	​	​	—	​	​	—
One-to-four family - mixed-use property		6	​	​	2,446	​	​	—	​	​	194
One-to-four family - residential		1	​	​	1,223	​	​	—	​	​	24
Total		15	​	$	10,439	​	$	—	​	$	273

(1) Does not include $2.6 million net gain on sale recorded from the reversal of a previously recorded valuation allowance upon the transfer of $32.1 million of loans held for sale to loans held for investment and $0.2 million net loss on sale recorded to write-down performing mortgage loans to their anticipated sales price.

​

​

​

​

​

​

​

​

-23-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

​

7.     Leases

The Company has 32 operating leases for branches (including headquarters) and office spaces, two operating leases for vehicles, and one operating lease for equipment. Our leases have remaining lease terms ranging from four months to approximately 11 years, none of which has a renewal option reasonably certain of exercise, which has been reflected in the Company’s calculation of the lease term. During the nine months ended September 30, 2025, the Company entered into an agreement to extend the term of its corporate headquarters operating lease by 3 years. During the nine months ended September 30, 2024, the Company entered into agreements to extend the term of five of its operating leases by 10 years each.

The Company has elected the short-term lease recognition exemption such that the Company will not recognize Right of Use (“ROU”) assets or lease liabilities for leases with a term of less than 12 months from the commencement date. The Company has two agreements in 2025 and 2024 that qualified as short-term leases, respectively.

​

Certain leases have escalation clauses for operating expenses and real estate taxes, which are recorded as variable lease cost. The Company’s non-cancelable operating lease agreements expire through 2036.

​

Supplemental balance sheet information related to leases are as follows:

​

​	​	​	​	​	​	​
​	​	​	​	​	​	​
​	​	​	​	​	​	​
(Dollars in thousands)	​	September 30, 2025		​	December 31, 2024
​	​	​	​	​	​	​
Operating lease ROU assets	​	$	47,761	​	$	45,800
​	​	​	​	​	​	​
Operating lease liabilities	​	$	48,253	​	$	46,443
​	​	​	​	​	​	​
Weighted-average remaining lease term-operating leases	​	​	6.8 years	​	​	7.3 years
Weighted average discount rate-operating leases	​	​	4.2%	​	​	4.0%

​

-24-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

The components of lease expense and cash flow information related to leases were as follows:

​

​	​	​	​	​	​	​	​	​
​	​	​	​	For the three months ended September 30,
(In thousands)	​	Line Item Presented	​	2025		​	2024
Lease Cost	​	​	​			​
Operating lease cost	​	Occupancy and equipment	​	$	2,508	​	$	2,235
Operating lease cost	​	Other operating expenses	​	​	5	​	​	16
Short-term lease cost	​	Professional services and other operating expenses	​		52	​		40
Variable lease cost	​	Occupancy and equipment	​		321	​		325
Total lease cost	​	​	​	$	2,886	​	$	2,616
​	​	​	​	​	​	​	​	​
Other information	​	​	​		​	​	​	​
Cash paid for amounts included in the measurement of lease liabilities:			​		​	​	​	​
Operating cash flows from operating leases	​	​	​	$	2,221	​	$	2,461
Right-of-use assets obtained in exchange for new operating lease liabilities			​	$	60	​	$	—

​

​

​	​	​	​	​	​	​	​	​
​	​	​	​	For the nine months ended September 30,
(In thousands)	​	Line Item Presented	​	2025		​	2024
Lease Cost	​	​	​			​
Operating lease cost	​	Occupancy and equipment	​	$	7,149	​	$	6,693
Operating lease cost	​	Other operating expenses	​	​	11	​	​	53
Short-term lease cost	​	Professional services and other operating expenses	​		152	​		121
Variable lease cost	​	Occupancy and equipment	​		948	​		918
Total lease cost	​	​	​	$	8,260	​	$	7,785
​	​	​	​	​	​	​	​	​
Other information	​	​	​		​	​
Cash paid for amounts included in the measurement of lease liabilities:			​	​	​	​
Operating cash flows from operating leases	​	​	​	$	7,316	​	$	7,370
Supplemental disclosure of non-cash activities:			​	​	​	​	​	​
Right-of-use assets obtained in exchange for new operating lease liabilities			​	$	7,893	​	$	10,894

​

The Company’s minimum annual rental payments for Bank facilities due under non-cancelable leases are as follows as of September 30, 2025:

​

​

​	​	​	​
​	​	Minimum Rental
​	​	(In thousands)
Years ended December 31:	​	​	​
2025	​	$	1,414
2026	​	​	9,828
2027	​	​	9,061
2028	​	​	8,910
2029	​	​	7,688
Thereafter	​	​	19,488
Total minimum payments required	​	​	56,389
Less: implied interest	​	​	(8,136)
Total lease obligations	​	$	48,253

-25-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

​

​

​

​

8. Stock-Based Compensation

On May 29, 2024, stockholders approved the Company’s 2024 Omnibus Incentive Plan (the “2024 Plan”) to replace the 2014 Omnibus Incentive Plan (the “2014 Plan”). The 2024 Plan is an “omnibus” stock plan that provides for a variety of equity award vehicles to maintain flexibility. The 2024 Plan, like the 2014 Plan, permits the grant of stock options, stock appreciation rights, restricted stock awards, restricted stock units (“RSUs”), performance-based restricted stock units (“PRSUs”), and other stock-based awards. Currently, awards to employees primarily consist of RSUs and PRSUs and to Company directors of RSUs. The 2024 Plan authorizes the issuance of up to 974,000 shares. Although no further awards may be granted under the 2014 Plan, outstanding awards granted prior to February 29, 2024, will continue in accordance with their terms.

The Company has a long-term incentive compensation program for certain Company executive officers that includes grants of PRSUs in addition to time-based RSUs. Under the terms of the PRSU Agreement, the number of PRSUs that may be earned depends on the extent to which performance goals for the award are achieved over a three-year performance period, as determined by the Compensation Committee of the Board. The number of PRSUs that may be earned ranges from 0% to 150% of the target award, with no PRSUs earned for below threshold-level performance, 50% of PRSUs earned for threshold-level performance, 100% of PRSUs earned for target-level performance, and 150% of PRSUs earned for maximum-level performance. As of September 30, 2025, PRSUs granted in 2025 and 2024 are being accrued at target with no accrual for the 2023 PRSUs. The different levels of accrual are commensurate with the projected performance of the respective grant.

For the three months ended September 30, 2025 and 2024, the Company’s net income, as reported, included $1.1 million and $1.0 million, respectively, of stock-based compensation costs, as recorded in salaries and employee benefits on the Consolidated Statements of Operations, including the benefit or expense of phantom stock awards, and $0.3 million and $0.2 million, respectively, of income tax benefits related to the stock-based compensation plans.

​

For the nine months ended September 30, 2025 and 2024, the Company’s net income, as reported, included $2.4 million, of stock-based compensation costs in both periods, as recorded in salaries and employee benefits on the Consolidated Statements of Operations, including the benefit or expense of phantom stock awards, and $1.1 million and $0.6 million of income tax benefit, respectively, related to the stock-based compensation plans.

​

During the three months ended September 30, 2025 and 2024 the Company did not grant any RSU or PRSU awards. During the nine months ended September 30, 2025 and 2024 the Company granted 228,501 and 217,650 RSU awards and 71,700 and 67,350 PRSU awards, respectively. As of September 30, 2025, 647,051 shares were available for future issuance under the 2024 Omnibus Plan.

​

The Company uses the fair value of the common stock on the date of award to measure compensation cost for restricted stock unit awards and performance restricted stock units. Compensation cost is recognized over the vesting period of the award using the straight-line method. Forfeitures are recorded in the period they occur.

​

​

​

​

​

​

​

​

-26-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

The following table summarizes the Company’s RSU and PRSU awards under the 2024 Omnibus Plan for the nine months ended September 30, 2025:

​

​	​	​	​	​	​	​	​	​	​	​
​		RSU Awards					PRSU Awards
​	​	​		Weighted-Average		​	​		Weighted-Average
​	​	​		Grant-Date		​	​		Grant-Date
​		Shares		Fair Value			Shares		Fair Value
Non-vested awards at December 31, 2024		322,796	​	$	18.91		83,160	​	$	17.42
Granted		228,501	​		14.44		71,700	​		14.56
Added (reduced) shares due to performance factor		—	​		—		(15,810)	​		19.99
Vested		(119,801)	​		18.16		—	​		—
Forfeited		(23,562)	​		16.58		—	​		—
Non-vested awards at September 30, 2025		407,934	​	$	16.76		139,050	​	$	15.65
Vested but unissued at September 30, 2025		161,472	​	$	19.18		—	​	$	—

​

As of September 30, 2025, there was $5.4 million of total unrecognized compensation cost related to RSU and PRSU awards granted. That cost is expected to be recognized over a weighted-average period of 1.9 years. The total fair value of awards vested for the three months ended September 30, 2025 and 2024, was $0.1 million at both periods. The total fair value of awards vested for the nine months ended September 30, 2025 and 2024 was $1.4 million and $2.8 million, respectively. The vested but unissued RSU and PRSU awards consist of awards made to employees and directors who are eligible for retirement. According to the terms of these awards, which provide for vesting upon retirement, these employees and directors have no risk of forfeiture. These shares will be issued at the original contractual vesting and settlement dates.

​

Phantom Stock Plan: The Company maintains a non-qualified phantom stock plan as a supplement to its profit-sharing plan for officers who have achieved the designated level and completed one year of service. The Company adjusts its liability under this plan to the fair value of the shares at the end of each period.

The following table summarizes the Phantom Stock Plan at or for the nine months ended September 30, 2025:

​

​	​	​	​	​	​	​	​	​
Phantom Stock Plan		Shares		Fair Value			Weighted-Average Fair Value
Outstanding at December 31, 2024		195,871	​	$	14.28	​	​	​
Granted		18,150	​	​	​	​	$	13.35
Distributions		(1,350)	​	​	​	​	$	13.44
Outstanding and vested at September 30, 2025		212,671	​	$	13.81	​	​	​

​

The Company recorded stock-based compensation expense (benefit) for the Phantom Stock Plan of $0.4 million and $0.3 million for the three months ended September 30, 2025 and 2024, respectively. The total fair value of the distributions from the Phantom Stock Plan was $5,000 and $2,000 for the three months ended September 30, 2025 and 2024, respectively.

The Company recorded stock-based compensation expense (benefit) for the Phantom Stock Plan of $0.1 million and ($0.2) million for the nine months ended September 30, 2025 and 2024, respectively. The total fair value of the distributions from the Phantom Stock Plan was $18,000 and $24,000 for the nine months ended September 30, 2025, and 2024, respectively.

​

-27-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

9.     Pension and Other Postretirement Benefit Plans

The following table sets forth information regarding the components of net expense for the pension and other postretirement benefit plans.

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Three months ended

Nine months ended

​

September 30,

September 30,

(In thousands)

2025

2024

2025

2024

Employee Pension Plan:

​

​

​

​

Interest cost

​

$

203

​

$

193

​

$

610

​

$

581

Expected return on plan assets

​

(277)

​

(284)

​

(831)

​

(852)

Net employee pension benefit (1)

​

$

(74)

​

$

(91)

​

$

(221)

​

$

(271)

​

​

​

​

​

​

​

​

​

​

​

​

​

Outside Director Pension Plan:

​

​

​

​

Service cost

​

$

2

​

$

2

​

$

6

​

$

6

Interest cost

​

12

​

11

​

36

​

33

Amortization of unrecognized gain

​

(25)

​

(38)

​

(75)

​

(114)

Net outside director pension (benefit) expense (2)

​

$

(11)

​

$

(25)

​

$

(33)

​

$

(75)

​

​

​

​

​

​

​

​

​

​

​

​

​

Other Postretirement Benefit Plans:

​

​

​

​

Service cost

​

$

38

​

$

41

​

$

114

​

$

125

Interest cost

​

115

​

96

​

345

​

288

Amortization of unrecognized gain

​

​

(48)

​

​

(54)

​

​

(144)

​

​

(162)

Net other postretirement expense (1)

​

$

105

​

$

83

​

$

315

​

$

251

(1) Reported in the Consolidated Statements of Operations as part of salaries and employee benefits.

(2) Reported in the Consolidated Statements of Operations as part of other operating expenses.

​

​

The Company previously disclosed in its Consolidated Financial Statements for the year ended December 31, 2024 that it expects to contribute $0.1 million to the outside director pension plan (the “Outside Director Pension Plan”) and $0.3 million to the other postretirement benefit plans (the “Other Postretirement Benefit Plans”), during the year ending December 31, 2025. The Company does not expect to contribute to the employee pension plan during the year ending December 31, 2025. As of September 30, 2025, the Company had contributed $0.1 million to the Other Postretirement Benefit Plans. As of September 30, 2025, the Company has not revised its expected contributions for the year ending December 31, 2025.

​

​

​

-28-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

10.     Fair Value of Financial Instruments

The Company carries certain financial assets and financial liabilities at fair value in accordance with GAAP which defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. GAAP permits entities to choose to measure many financial instruments and certain other items at fair value. The Company did not purchase or sell any financial assets or liabilities carried under the fair value option during the three and nine months ended September 30, 2025 and 2024.

The following table presents the financial assets and financial liabilities reported at fair value under the fair value option, and the changes in fair value included in the Consolidated Statement of Operations – Net (loss) gain from fair value adjustments, at or for the periods ended as indicated:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Changes in Fair Values For Items Measured at Fair Value

​

​

Fair Value

​

Fair Value

​

Pursuant to Election of the Fair Value Option

​

Measurements at

Measurements at

​

For the three months ended September 30,

​

For the nine months ended September 30,

Description

September 30, 2025

December 31, 2024

2025

2024

2025

2024

(In thousands)

​

​

​

​

​

​

​

Mortgage-backed securities

​

$

218

​

$

237

​

$

1

​

$

6

​

$

1

​

$

7

Other securities

​

13,992

​

13,355

​

179

​

407

​

359

​

256

Borrowed funds

​

49,653

​

48,795

​

(2,208)

​

561

​

(884)

​

(66)

Net gain (loss) from fair value adjustments

​

​

​

​

​

​

​

$

(2,028)

​

$

974

​

$

(524)

​

$

197

​

​

Included in the fair value of the financial assets and financial liabilities selected for the fair value option is the accrued interest receivable or payable for the related instrument. The Company reports as interest income or interest expense in the Consolidated Statement of Operations, the interest receivable or payable on the financial instruments selected for the fair value option at their respective contractual rates.

The borrowed funds had a contractual principal amount of $61.9 million at both September 30, 2025 and December 31, 2024. The fair value of borrowed funds includes accrued interest payable of $0.4 million at both September 30, 2025 and December 31, 2024.

The Company generally holds its interest-earning assets to maturity and settles its liabilities at maturity. However, fair value estimates are made at a specific point in time and are based on relevant market information. These estimates do not reflect any premium or discount that could result from offering for sale at one time the Company’s entire holdings of a particular instrument. Accordingly, as assumptions change, such as interest rates and prepayments, fair value estimates change, and these amounts may not necessarily be realized in an immediate sale.

Disclosure of fair value does not require fair value information for items that do not meet the definition of a financial instrument or certain other financial instruments specifically excluded from its requirements. These items include core deposit intangibles and other customer relationships, premises and equipment, leases, income taxes and equity.

Further, fair value disclosure does not attempt to value future income or business. These items may be material and accordingly, the fair value information presented does not purport to represent, nor should it be construed to represent, the underlying “market” or franchise value of the Company.

A description of the methods and significant assumptions utilized in estimating the fair value of the Company’s financial assets and liabilities that are carried at fair value on a recurring basis are as follows:

Level 1 – when quoted market prices are available in an active market. At September 30, 2025 and December 31, 2024, Level 1 included one mutual fund.

-29-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

Level 2 – when quoted market prices are not available, fair value is estimated using quoted market prices for similar financial instruments and adjusted for differences between the quoted instrument and the instrument being valued. Fair value can also be estimated by using pricing models, or discounted cash flows. Pricing models primarily use market-based or independently sourced market parameters as inputs, including, but not limited to, yield curves, interest rates, equity or debt prices and credit spreads. In addition to observable market information, models also incorporate maturity and cash flow assumptions. At September 30, 2025 and December 31, 2024, Level 2 included mortgage-backed securities, CLOs, corporate debt, municipals, and interest rate swaps.

Level 3 – when there is limited activity or less transparency around inputs to the valuation, financial instruments are classified as Level 3. At September 30, 2025 and December 31, 2024, Level 3 included trust preferred securities owned, and junior subordinated debentures issued by the Company, as well as municipal bonds.

The methods described above may produce fair values that may not be indicative of net realizable value or reflective of future fair values. While the Company believes its valuation methods are appropriate and consistent with those of other market participants, the use of different methodologies, assumptions, and models to determine fair value of certain financial instruments could produce different estimates of fair value at the reporting date.

The following table sets forth the Company’s assets and liabilities that are carried at fair value on a recurring basis, including those reported at fair value under the fair value option, and the level that was used to determine their fair value, at September 30, 2025 and December 31, 2024:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Quoted Prices

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

in Active Markets

​

Significant Other

​

Significant Other

​

​

​

​

​

​

​

​

for Identical Assets

​

Observable Inputs

​

Unobservable Inputs

​

Total carried at fair value

​

​

(Level 1)

​

(Level 2)

​

(Level 3)

​

on a recurring basis

​

2025

2024

2025

2024

2025

2024

2025

2024

Assets:

(In thousands)

Securities available for sale:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Mortgage-backed securities

​

$

—

​

$

—

​

$

906,270

​

$

911,636

​

$

—

​

$

—

​

$

906,270

​

$

911,636

Other securities

​

12,502

​

11,890

​

603,882

​

554,914

​

18,769

​

19,465

​

635,153

​

586,269

Derivatives

​

—

​

—

​

40,615

​

54,700

​

—

​

—

​

40,615

​

54,700

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Total assets

​

$

12,502

​

$

11,890

​

$

1,550,767

​

$

1,521,250

​

$

18,769

​

$

19,465

​

$

1,582,038

​

$

1,552,605

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Liabilities:

​

​

​

​

​

​

​

​

Borrowings

​

$

—

​

$

—

​

$

—

​

$

—

​

$

49,653

​

$

48,795

​

$

49,653

​

$

48,795

Derivatives

​

—

​

—

​

33,426

​

20,396

​

—

​

—

​

33,426

​

20,396

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Total liabilities

​

$

—

​

$

—

​

$

33,426

​

$

20,396

​

$

49,653

​

$

48,795

​

$

83,079

​

$

69,191

​

​

-30-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

The following table sets forth the Company’s assets and liabilities that are carried at fair value on a recurring basis, classified within Level 3 of the valuation hierarchy for the periods indicated:  

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

For the three months ended

​

​

September 30, 2025

​

September 30, 2024

​

​

​

​

Trust preferred

​

Junior subordinated

​

Trust preferred

​

Junior subordinated

​

Municipals

securities

debentures

securities

debentures

(In thousands)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Beginning balance

​

$

16,878

​

$

1,428

​

$

47,552

​

$

1,457

​

$

48,541

Net gain (loss) from fair value adjustment of financial assets (1)

​

—

​

63

​

—

​

(18)

​

—

Net (gain) loss from fair value adjustment of financial liabilities (1)

​

—

​

—

​

2,208

​

—

​

(561)

Increase (decrease) in accrued interest

​

—

​

—

​

3

​

—

​

(3)

(Provision) benefit for credit losses

​

145

​

—

​

—

​

—

​

—

Change in unrealized gains (losses) included in other comprehensive loss-assets

​

255

​

—

​

—

​

—

​

—

Change in unrealized (gains) losses included in other comprehensive loss-liabilities

​

—

​

—

​

(110)

​

—

​

(54)

Ending balance

​

$

17,278

​

$

1,491

​

$

49,653

​

$

1,439

​

$

47,923

Changes in unrealized gains (losses) held at period end

​

$

(428)

​

$

—

​

$

2,287

​

$

—

​

$

2,384

(1) Presented in the Consolidated Statements of Operations under net (loss) gain from fair value adjustments.

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

For the nine months ended

​

​

September 30, 2025

​

September 30, 2024

​

​

​

​

Trust preferred

​

Junior subordinated

​

Trust preferred

​

Junior subordinated

​

Municipals

securities

debentures

securities

debentures

(In thousands)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Beginning balance

​

$

18,000

​

$

1,465

​

$

48,795

​

$

1,437

​

$

47,850

Net gain (loss) from fair value adjustment of financial assets (1)

​

—

​

—

​

—

​

3

​

—

Net (gain) loss from fair value adjustment of financial liabilities (1)

​

—

​

27

​

884

​

—

​

66

Increase (decrease) in accrued interest

​

—

​

(1)

​

(22)

​

(1)

​

(34)

(Provision) benefit for credit losses

​

(294)

​

—

​

—

​

—

​

—

Change in unrealized gains (losses) included in other comprehensive loss-assets

​

(428)

​

—

​

—

​

—

​

—

Change in unrealized (gains) losses included in other comprehensive loss-liabilities

​

—

​

—

​

(4)

​

—

​

41

Ending balance

​

$

17,278

​

$

1,491

​

$

49,653

​

$

1,439

​

$

47,923

Changes in unrealized gains (losses) held at period end

​

$

(428)

​

$

—

​

$

2,287

​

$

—

​

$

2,384

(1) Presented in the Consolidated Statements of Operations under net (loss) gain from fair value adjustments.

​

​

​

​

​

​

​

​

-31-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

​

The following tables present the quantitative information about recurring Level 3 fair value of financial instruments and the fair value measurements at the periods indicated:

​

​

​

​	​	​	​	​	​	​	​	​	​	​	​
​	​	September 30, 2025
​	​	​	​	​	Valuation	​	Unobservable	​	​	​	Weighted
​		Fair Value		​	Technique	​	Input	​	Range	​	Average
​	​	(Dollars in thousands)
Assets:	​
Municipals	​	$	17,278		Discounted cash flows		Spread over A rated Municipal Curves		5.9	%	n/a
Trust preferred securities	​	​	1,491		Discounted cash flows		Spread over 3-month SOFR		4.2	​	n/a
​	​	​	​	​	​	​	​	​	​	​	​
Liabilities:	​									​
Junior subordinated debentures	​	$	49,653		Discounted cash flows		Spread over 3-month SOFR		4.2	%	n/a

​

​	​	​	​	​	​	​	​	​	​	​	​
​	​	December 31, 2024
​	​	​	​	​	Valuation	​	Unobservable	​	​	​	Weighted
​		Fair Value		​	Technique	​	Input	​	Range	​	Average
​	​	(Dollars in thousands)
Assets:	​
Municipals	​	$	18,000		Sales approach		Reduction for planned expedited disposal		n/a	​	n/a
Trust preferred securities	​	​	1,465		Discounted cash flows		Spread over 3-month SOFR		4.3	%	n/a
​	​	​	​	​	​	​	​	​	​	​	​
Liabilities:	​									​
Junior subordinated debentures	​	$	48,795		Discounted cash flows		Spread over 3-month SOFR		4.3	%	n/a

​

​

The significant unobservable inputs used in the fair value measurement of the Company’s municipals, trust preferred securities and junior subordinated debentures valued under Level 3 at September 30, 2025 and December 31, 2024, are the effective yields used in the cash flow models. Significant increases or decreases in the effective yield in isolation would result in a significantly lower or higher fair value measurement.

​

The following table sets forth the Company’s assets and liabilities that are carried at fair value on a non-recurring basis and the level that was used to determine their fair value at September 30, 2025 and December 31, 2024:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Quoted Prices

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

in Active Markets

​

Significant Other

​

Significant Other

​

​

​

​

​

​

​

​

for Identical Assets

​

Observable Inputs

​

Unobservable Inputs

​

Total carried at fair value

​

​

(Level 1)

​

(Level 2)

​

(Level 3)

​

on a non-recurring basis

​

2025

2024

2025

2024

2025

2024

2025

2024

​

(In thousands)

Assets:

​

​

​

​

​

​

​

​

Impaired loans

​

$

—

​

$

—

​

$

—

​

$

—

​

$

25,108

​

$

16,784

​

$

25,108

​

$

16,784

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Total assets

​

$

—

​

$

—

​

$

—

​

$

—

​

$

25,108

​

$

16,784

​

$

25,108

​

$

16,784

​

-32-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

​

The following tables present the qualitative information about non-recurring Level 3 fair value of financial instruments and the fair value measurements at the periods indicated:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

At September 30, 2025

​

Fair Value

Valuation Technique

Unobservable Input

Range

Weighted Average

​

​

(Dollars in thousands)

Assets:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Impaired loans

$

9,133

​

Income approach

​

Capitalization rate

​

5.5 to 6.5

%

5.8

%

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Impaired loans

​

14,644

​

Sales approach

​

Adjustment to sales comparison value

​

-25.0 to 10.0

​

(7.9)

​

​

​

​

​

​

​

Reduction for planned expedited disposal

​

15.0

​

15.0

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Impaired loans

​

1,331

​

Discounted Cashflow

​

Discount Rate

​

8.3

​

8.3

​

​

​

​

​

​

​

Probability of Default

​

25.0

​

25.0

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

At December 31, 2024

​

Fair Value

Valuation Technique

Unobservable Input

Range

Weighted Average

​

​

(Dollars in thousands)

Assets:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Impaired loans

$

4,121

​

Sales approach

​

Adjustment to sales comparison value

​

-

%

-

%

​

​

​

​

​

​

​

Reduction for planned expedited disposal

​

15.0

​

15.0

​

​

​

​

​

​

​

​

​

​

​

​

​

Impaired loans

​

2,453

​

Discounted Cashflow

​

Discount Rate

​

9.3% to 10.0

​

9.5

​

​

​

​

​

​

​

Probability of Default

​

25.0% to 50.0

​

33.2

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Impaired loans

​

10,210

​

Income approach

​

Capitalization rate

​

4.8% to 6.5

​

5.7

​

​

The weighted average for unobservable inputs for collateral-dependent loans is based on the relative fair value of the loans.

The Company did not have any liabilities that were carried at fair value on a non-recurring basis at September 30, 2025 and December 31, 2024.

​

The methods and assumptions used to estimate fair value at September 30, 2025 and December 31, 2024 are as follows:

Securities:

The fair values of securities are contained in Note 4 (“Securities”) of the Notes to Consolidated Financial Statements. Fair value is based upon quoted market prices, where available. If a quoted market price is not available, fair value is estimated using quoted market prices for similar securities and adjusted for differences between the quoted instrument and the instrument being valued. When there is limited activity or less transparency around inputs to the valuation, securities are valued using discounted cash flows.

Impaired Loans:

For impaired loans, fair value is generally estimated by discounting management’s estimate of future cash flows with a discount rate commensurate with the risk associated with such assets or, for collateral dependent loans, 85% of the

-33-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

appraised or internally estimated value of the property. See Note 5 (“Loans”) of the Notes to the Consolidated Financial Statements.

Junior Subordinated Debentures:

The fair value of the junior subordinated debentures was developed using a credit spread based on stated spreads for recently issued subordinated debt instruments for issuers of similar asset size and credit quality of the Company and with similar durations adjusting for differences in the junior subordinated debt’s credit rating, liquidity, and time to maturity. The unrealized net gain/loss attributable to changes in our own credit risk was determined by adjusting the fair value as determined in the proceeding sentence by the average rate of default on debt instruments with a similar debt rating as our junior subordinated debentures, with the difference from the original calculation and this calculation resulting in the instrument-specific unrealized gain/loss.

Derivatives:

The fair value of interest rate swaps and floor options are based upon broker quotes.

-34-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

The following tables set forth the carrying amounts and estimated fair values of selected financial instruments based on the assumptions described above used by the Company in estimating fair value at the periods indicated:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

September 30, 2025

​

​

Carrying

​

Fair

​

​

​

​

​

​

​

​

​

​

Amount

Value

Level 1

Level 2

Level 3

​

(In thousands)

Assets:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Cash and due from banks

​

$

142,929

​

$

142,929

​

$

142,929

​

$

—

​

$

—

Securities held-to-maturity

​

​

​

​

​

Mortgage-backed securities

​

7,821

​

7,188

​

—

​

7,188

​

—

Other securities

​

42,688

​

39,196

​

—

​

—

​

39,196

Securities available for sale

​

​

​

​

​

Mortgage-backed securities

​

906,270

​

906,270

​

—

​

906,270

​

—

Other securities

​

635,153

​

635,153

​

12,502

​

603,882

​

18,769

Loans held for investment, net of fees and costs

​

6,670,333

​

6,401,375

​

—

​

—

​

6,401,375

FHLB-NY stock

​

18,909

​

18,909

​

—

​

18,909

​

—

Accrued interest receivable

​

60,044

​

60,044

​

—

​

60,044

​

—

Derivatives

​

40,615

​

40,615

​

—

​

40,615

​

—

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Liabilities:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Deposits

​

$

7,415,528

​

$

7,410,682

​

$

4,996,489

​

$

2,414,193

​

$

—

Borrowed Funds

​

492,457

​

465,171

​

—

​

415,518

​

49,653

Accrued interest payable

​

12,896

​

12,896

​

—

​

12,896

​

—

Derivatives

​

33,426

​

33,426

​

—

​

33,426

​

—

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

December 31, 2024

​

​

Carrying

​

Fair

​

​

​

​

​

​

​

​

​

​

Amount

Value

Level 1

Level 2

Level 3

​

​

(In thousands)

Assets:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Cash and due from banks

​

$

152,574

​

$

152,574

​

$

152,574

​

$

—

​

$

—

Securities held-to-maturity

​

​

​

​

​

Mortgage-backed securities

​

7,836

​

6,903

​

—

​

6,903

​

—

Other securities

​

43,649

​

37,815

​

—

​

—

​

37,815

Securities available for sale

​

​

​

​

​

Mortgage-backed securities

​

911,636

​

911,636

​

—

​

911,636

​

—

Other securities

​

586,269

​

586,269

​

11,890

​

554,914

​

19,465

Loans held for sale

​

70,098

​

70,098

​

—

​

—

​

70,098

Loans held for investment, net of fees and costs

​

6,745,848

​

6,506,439

​

—

​

—

​

6,506,439

FHLB-NY stock

​

38,096

​

38,096

​

—

​

38,096

​

—

Accrued interest receivable

​

62,036

​

62,036

​

—

​

62,036

​

—

Derivatives

​

54,700

​

54,700

​

—

​

54,700

​

—

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Liabilities:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Deposits

​

$

7,178,933

​

$

7,148,847

​

$

4,528,769

​

$

2,620,078

​

$

—

Borrowed Funds

​

916,054

​

887,312

​

—

​

838,517

​

48,795

Accrued interest payable

​

12,275

​

12,275

​

—

​

12,275

​

—

Derivatives

​

20,396

​

20,396

​

—

​

20,396

​

—

​

​

​

​

​

​

-35-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

11.     Derivative Financial Instruments

At September 30, 2025, the Company’s derivative financial instruments consisted of interest rate swaps and interest rate floor options. At December 31, 2024, the Company’s derivative financial instruments consisted of interest rate swaps. At September 30, 2025, the Company’s derivatives are used for four purposes: 1) to mitigate the Company’s exposure to rising interest rates on certain fixed rate loans with a notional amount of $647.3 million and $695.6 million of swaps outstanding at September 30, 2025 and December 31, 2024, respectively; 2) to facilitate risk management strategies for our loan customers with $1.1 billion of swaps outstanding, which include $553.2 million each with customers and bank counterparties at September 30, 2025 and $973.9 million of swaps outstanding, which include $486.9 million each with customers and bank counterparties at December 31, 2024; 3) to mitigate exposure to rising interest rates on certain short-term advances and brokered deposits with $905.8 million and $950.8 million of swaps outstanding at September 30, 2025 and December 31, 2024, respectively; and 4) to mitigate the Company’s exposure to decreasing interest rates on a portion of its adjustable rate loan portfolio with a notional amount of $100.0 million of interest rate floor options outstanding at September 30, 2025. There were no interest rate floor options outstanding at December 31, 2024.

At September 30, 2025 and December 31, 2024, the Company maintained portfolio layer hedges on a closed portfolio of loans with a notional amount of $480.0 million and $500.0 million, respectively.

​

For non-portfolio layer method fair value hedges, the hedge basis (the amount of the change in fair value) is added to (or subtracted from) the carrying amount of the hedged item. For portfolio layer method hedges, the hedge basis does not adjust the carrying value of the hedged item and is instead maintained on a closed portfolio basis. These basis adjustments would be allocated to the amortized cost of specific loans within the pools if the hedges were de-designated.

At September 30, 2025 and December 31, 2024, we held derivatives designated as cash flow hedges, fair value hedges and certain derivatives not designated as hedges.

The Company’s derivative instruments are carried at fair value in the Company’s financial statements as part of Other assets for derivatives with positive fair values and Other liabilities for derivatives with negative fair values. The accounting for changes in the fair value of a derivative instrument is dependent upon whether or not it qualifies and has been designated as a hedge for accounting purposes, and further, by the type of hedging relationship.

For cash flow hedges, the changes in the fair value of the derivatives are reported in accumulated other comprehensive income (loss), net of tax. Amounts in accumulated other comprehensive income (loss) are reclassified into earnings in the same period during which the hedged forecasted transaction affected earnings. During the three months ended September 30, 2025 and 2024, $2.4 million and $6.6 million in reduced expense, respectively, was reclassified from accumulated other comprehensive income (loss) to interest expense. During the nine months ended September 30, 2025 and 2024, $9.8 million and $19.9 million in reduced expense was reclassified from accumulated other comprehensive loss to interest expense. The estimated amount to be reclassified in the next 12 months out of accumulated other comprehensive income (loss) into earnings is $1.6 million in reduced expense.

​

A portion of the reduced expense is driven by the amortization of income from terminated cash flow hedges. This income is amortized over the remaining original terms of terminated cash flow hedges. During the three months ended September 30, 2025 and 2024, there were no cashflow hedges terminated. During the nine months ended September 30, 2025, there were no cashflow hedges terminated. During the nine months ended September 30, 2024, the Company terminated seven cash flow hedges with a combined notional value of $420.8 million, resulting in a net gain of $1.7 million. During the three months ended September 30, 2025 and 2024, income from the amortization of terminated cash flow hedges totaled $0.1 million and $0.2 million, respectively. During the nine months ended September 30, 2025 and 2024, income from the amortization of terminated cash flow hedges totaled $0.4 million and $1.2 million, respectively.

​

-36-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

​

The following table sets forth information regarding the Company’s derivative financial instruments at the periods indicated:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Assets

Liabilities

​

​

Notional

​

​

​

​

Notional

​

​

​

​

Amount

Fair Value (1)

Amount

Fair Value (1)

September 30, 2025

​

(In thousands)

Cash flow hedges:

​

​

​

​

​

​

​

​

​

​

​

​

Interest rate swaps (deposits)

​

$

205,000

​

$

2,035

​

$

700,750

​

$

6,138

Interest rate floor options (loans)

​

​

100,000

​

​

1,117

​

​

—

​

​

—

Fair value hedges:

​

​

​

​

​

​

​

​

​

​

​

​

Interest rate swaps (loans)

​

​

412,324

​

​

11,848

​

​

235,000

​

​

1,673

Non hedge:

​

​

​

​

​

​

​

​

​

​

​

​

Interest rate swaps (loans)

​

553,238

​

​

25,615

​

​

553,238

​

​

25,615

Total

​

$

1,270,562

​

$

40,615

​

$

1,488,988

​

$

33,426

​

​

​

​

​

​

​

​

​

​

​

​

​

December 31, 2024

​

​

​

​

​

​

​

​

​

​

​

​

Cash flow hedges:

​

​

​

​

​

​

​

​

​

​

​

​

Interest rate swaps (deposits)

​

$

950,750

​

$

14,686

​

$

—

​

$

—

Fair value hedges:

​

​

​

​

​

​

​

​

​

​

​

​

Interest rate swaps (loans)

​

​

560,587

​

​

19,812

​

​

135,000

​

​

194

Non hedge:

​

​

​

​

​

​

​

​

​

​

​

​

Interest rate swaps (loans)

​

486,929

​

​

20,202

​

​

486,929

​

​

20,202

Total

​

$

1,998,266

​

$

54,700

​

$

621,929

​

$

20,396

(1) Derivatives in a positive position are recorded as “Other assets” and derivatives in a negative position are recorded as “Other liabilities” in the Consolidated Statements of Financial Condition.

​

​

The following table presents information regarding the Company’s fair value hedged items for the periods indicated:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Cumulative Amount

​

​

​

​

​

​

​

​

of the Fair Value Hedging Adjustment

Line Item in the Consolidated Statement

​

Carrying Amount of the

​

Included in the Carrying Amount of

of Financial Condition in Which

​

Hedged

​

the Hedged

the Hedged Item Is Included

​

Assets/(Liabilities)

​

Assets/(Liabilities)

(In thousands)

​

September 30, 2025

​

December 31, 2024

​

September 30, 2025

​

December 31, 2024

Loans

​

​

​

​

​

​

​

​

​

​

​

​

Multi-family residential

​

$

84,554

​

$

76,882

​

$

502

​

$

(11,015)

Commercial real estate

​

​

59,375

​

​

62,843

​

​

372

​

​

(4,009)

Commercial business

​

​

26,029

​

​

39,500

​

​

174

​

​

(3,113)

Total

​

$

169,958

​

$

179,225

​

$

1,048

​

$

(18,137)

​

​

​

​

​

​

​

​

​

​

​

​

​

Portfolio Layer

​

​

​

​

​

​

​

​

​

​

​

​

Loans held for Investment (1)

​

$

480,000

​

$

500,000

​

$

1,421

​

$

(2,025)

Total

​

$

480,000

​

$

500,000

​

$

1,421

​

$

(2,025)

(1) Carrying amount represents the amortized cost of the portfolio layer method closed portfolio at September 30 2025 and December 31, 2024, totaling $2.2 billion and $2.4 billion, respectively.

​

​

​

-37-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

​

The following table sets forth the effect of derivative instruments on the Consolidated Statements of Operations for the periods indicated:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

For the three months ended

For the nine months ended

​

​

Affected Line Item in the Statements

​

September 30,

​

September 30,

(In thousands)

Where Net Income is Presented

2025

2024

2025

2024

Financial Derivatives:

​

​

​

​

​

​

​

Interest rate swaps - fair value hedge (loans)

​

Interest and fees on loans

​

$

2,032

​

$

3,962

​

$

6,022

​

$

11,345

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Interest rate swaps - fair value hedge (securities)

​

Interest and dividends on securities

​

​

—

​

​

1,181

​

​

—

​

​

3,185

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Interest rate swaps - non hedge (municipal deposit)

​

Interest expense - Deposits

​

​

—

​

—

​

​

—

​

​

1

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Interest rate swaps - cash flow hedge (short-term advances)

​

Other interest expense

​

​

—

​

195

​

​

—

​

​

559

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Interest rate swaps - cash flow hedge (brokered deposits)

​

Interest expense - Deposits

​

​

2,543

​

6,411

​

​

9,969

​

​

19,341

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Interest rate floor options - cash flow hedge (loans)

​

Interest and fees on loans

​

​

(104)

​

​

—

​

​

(219)

​

​

—

Total net income (expense) from the effects of derivative instruments

​

$

4,471

​

$

11,749

​

$

15,772

​

$

34,431

​

​

The Company’s derivatives are subject to master netting arrangements between the Company and its designated counterparties. The Company has not made a policy election to offset its derivative positions. The interest rate swaps with borrowers are cross collateralized with the underlying loan and, therefore, there is no posted collateral. Interest rate swap agreements with third-party counterparties contain provisions that require the Company to post collateral if the derivative exposure exceeds a threshold amount and receive collateral for agreements in a net asset position.

The following table presents the effect of the master netting arrangements on the presentation of the derivative assets and liabilities in the Consolidated Statements of Financial Condition as of the dates indicated:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Gross Amount

​

Net Amount

​

​

​

​

​

​

​

​

​

​

Gross Amounts

​

Offset in Statement of

​

Presented in Statement of

​

Financial

​

Cash

​

​

(In thousands)

Recognized

Financial Condition

Financial Condition

Instruments

Collateral

Net Amount

September 30, 2025

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Assets:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Interest rate swaps

​

$

39,498

​

$

—

​

$

39,498

​

$

—

​

$

(17,315)

​

$

22,183

Interest rate floor options

​

​

1,117

​

​

—

​

​

1,117

​

​

—

​

​

—

​

​

1,117

Liabilities:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Interest rate swaps

​

​

33,426

​

​

—

​

​

33,426

​

​

—

​

​

—

​

​

33,426

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

December 31, 2024

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Assets:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Interest rate swaps

​

$

54,700

​

$

—

​

$

54,700

​

$

—

​

$

(47,665)

​

$

7,035

Liabilities:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Interest rate swaps

​

​

20,396

​

​

—

​

​

20,396

​

​

—

​

​

—

​

​

20,396

​

​

​

​

​

​

​

​

​

-38-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

12.     Accumulated Other Comprehensive Income (Loss):

The following tables set forth the changes in accumulated other comprehensive income (loss) by component for the periods indicated:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

For the three months ended September 30, 2025

​

​

Unrealized Gains

​

Unrealized Gains

​

​

​

​

​

​

​

​

​

​

​

(Losses) on

​

(Losses) on

​

​

​

​

Fair Value

​

​

​

​

​

Available for Sale

​

Cash flow

​

Defined Benefit

​

Option Elected

​

​

​

​

Securities

Hedges

Pension Items

on Liabilities

Total

​

(In thousands)

Beginning balance, net of tax

​

$

(1,355)

​

$

(471)

​

$

(948)

​

$

1,510

​

$

(1,264)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Other comprehensive income (loss) before reclassifications, net of tax

​

3,773

​

(354)

​

—

​

76

​

3,495

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Amounts reclassified from accumulated other comprehensive income (loss), net of tax

​

(457)

​

(1,683)

​

(49)

​

—

​

(2,189)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Net current period other comprehensive income (loss), net of tax

​

3,316

​

(2,037)

​

(49)

​

76

​

1,306

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Ending balance, net of tax

​

$

1,961

​

$

(2,508)

​

$

(997)

​

$

1,586

​

$

42

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

For the three months ended September 30, 2024

​

​

Unrealized Gains

​

Unrealized Gains

​

​

​

​

​

​

​

​

​

​

​

(Losses) on

​

(Losses) on

​

​

​

​

Fair Value

​

​

​

​

​

Available for Sale

​

Cash flow

​

Defined Benefit

​

Option Elected

​

​

​

​

Securities

Hedges

Pension Items

on Liabilities

Total

​

(In thousands)

Beginning balance, net of tax

​

$

(56,910)

​

$

16,489

​

$

(507)

​

$

1,612

​

$

(39,316)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Other comprehensive income (loss) before reclassifications, net of tax

​

13,062

​

(9,964)

​

—

​

37

​

3,135

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Amounts reclassified from accumulated other comprehensive income (loss), net of tax

​

—

​

(4,554)

​

(64)

​

—

​

(4,618)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Net current period other comprehensive income (loss), net of tax

​

13,062

​

(14,518)

​

(64)

​

37

​

(1,483)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Ending balance, net of tax

​

$

(43,848)

​

$

1,971

​

$

(571)

​

$

1,649

​

$

(40,799)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

-39-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

For the nine months ended September 30, 2025

​

Unrealized Gains

​

Unrealized Gains

​

​

​

​

​

​

​

​

​

​

(Losses) on

​

(Losses) on

​

​

​

​

Fair Value

​

​

​

​

Available for Sale

Cash flow

Defined Benefit

Option Elected

​

​

​

​

Securities

Hedges

Pension Items

on Liabilities

Total

​

(In thousands)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Beginning balance, net of tax

​

$

(4,331)

​

$

10,728

​

$

(848)

​

$

1,584

​

$

7,133

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Other comprehensive income (loss) before reclassifications, net of tax

6,749

​

(5,752)

​

—

​

2

​

999

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Amounts reclassified from accumulated other comprehensive income (loss), net of tax

(457)

​

(7,484)

​

(149)

​

—

​

(8,090)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Net current period other comprehensive income (loss), net of tax

6,292

​

(13,236)

​

(149)

​

2

​

(7,091)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Ending balance, net of tax

​

$

1,961

​

$

(2,508)

​

$

(997)

​

$

1,586

​

$

42

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

For the nine months ended September 30, 2024

​

Unrealized Gains

​

Unrealized Gains

​

​

​

​

​

​

​

​

​

​

(Losses) on

​

(Losses) on

​

​

​

​

Fair Value

​

​

​

​

Available for Sale

Cash flow

Defined Benefit

Option Elected

​

​

​

​

Securities

Hedges

Pension Items

on Liabilities

Total

​

(In thousands)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Beginning balance, net of tax

​

$

(54,744)

​

$

14,796

​

$

(381)

​

$

1,678

​

$

(38,651)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Other comprehensive income (loss) before reclassifications, net of tax

10,896

​

893

​

—

​

(29)

​

11,760

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Amounts reclassified from accumulated other comprehensive income (loss), net of tax

—

​

(13,718)

​

(190)

​

—

​

(13,908)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Net current period other comprehensive income (loss), net of tax

10,896

​

(12,825)

​

(190)

​

(29)

​

(2,148)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Ending balance, net of tax

​

$

(43,848)

​

$

1,971

​

$

(571)

​

$

1,649

​

$

(40,799)

​

-40-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

The following tables set forth significant amounts reclassified from accumulated other comprehensive income (loss) by component for the periods indicated:

​

​	​	​	​	​	​
For the three months ended September 30, 2025
​	​	Amounts Reclassified from		​	​
Details about Accumulated Other	​	Accumulated Other		​	Affected Line Item in the Statement
Comprehensive Income Components		Comprehensive Income (Loss)			Where Net Income (Loss) is Presented
(In thousands)
Unrealized gains (losses) on available for sale securities	​	$	661	​	Net gain (loss) on sale of securities
​	​		(204)	​	Provision (benefit) for income taxes
​	​	$	457	​	​
Cash flow hedges:	​			​
Interest rate swaps benefit (expense)	​	$	2,543		Interest expense
Interest rate floor options benefit (expense)	​	​	(104)	​	Interest and fees on loans
​	​	​	2,439	​	Total before tax
​	​		(756)		Provision (benefit) for income taxes
​	​	$	1,683		​
​	​	​	​	​	​
Amortization of defined benefit pension items:	​			​
Actuarial losses benefit (expense)	​	$	73	(1)	Other operating expense
​	​		(24)		Provision (benefit) for income taxes
​	​	$	49		​

​

​	​	​	​	​	​
For the three months ended September 30, 2024
​	​	Amounts Reclassified from		​	​
Details about Accumulated Other	​	Accumulated Other		​	Affected Line Item in the Statement
Comprehensive Income Components		Comprehensive Income (Loss)			Where Net Income (Loss) is Presented
(In thousands)
Cash flow hedges:	​
Interest rate swaps benefit (expense)	​	$	6,606		Interest expense
​	​		(2,052)		Provision (benefit) for income taxes
​	​	$	4,554		​
​	​	​	​	​	​
Amortization of defined benefit pension items:	​			​
Actuarial losses benefit (expense)	​	$	92	(1)	Other operating expense
​	​		(28)	​	Provision (benefit) for income taxes
​	​	$	64		​

(1) These accumulated other comprehensive income (loss) components are included in the computation of net periodic pension cost. See Note 9 (“Pension and Other Postretirement Benefit Plans”) of the Notes to the Consolidated Financial Statements for additional information.

​

​

​

​

​

​

​

​

​

​

-41-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

​	​	​	​	​	​
For the nine months ended September 30, 2025
​		Amounts Reclassified from		​	​
Details about Accumulated Other		Accumulated Other		​	Affected Line Item in the Statement
Comprehensive Income Components		Comprehensive Income (Loss)			Where Net Income (Loss) is Presented
​	​	​	(In thousands)	​	​
Unrealized gains (losses) on available for sale securities	​	$	661	​	Net gain (loss) on sale of securities
​	​		(204)	​	Provision (benefit) for income taxes
​	​	$	457	​	​
​	​	​	​	​
Cash flow hedges:		​		​	​
Interest rate swaps benefit (expense)	​	$	9,969	​	Interest expense
​	​	​	(219)	​	Interest and fees on loans
​	​		9,750	​	Total before tax
​	​	​	(2,266)		Provision (benefit) for income taxes
​	​	$	7,484		​
​	​	​	​	​	​
Amortization of defined benefit pension items:	​			​	​
Actuarial losses benefit (expense)	​	$	219	(1)	Other operating expenses
​	​		(70)	​	Provision (benefit) for income taxes
​	​	$	149	​	​

​

​

​	​	​	​	​	​
For the nine months ended September 30, 2024
​		Amounts Reclassified from		​	​
Details about Accumulated Other		Accumulated Other			Affected Line Item in the Statement
Comprehensive Income Components		Comprehensive Income (Loss)		​	Where Net Income (Loss) is Presented
​	​	​	(In thousands)	​	​
Cash flow hedges:		​		​	​
Interest rate swaps benefit (expense)	​	$	19,900	​	Interest expense
​	​		(6,182)	​	Provision (benefit) for income taxes
​	​	$	13,718	​	​
​	​	​	​	​	​
Amortization of defined benefit pension items:	​			​	​
Actuarial losses benefit (expense)	​	$	276	(1)	Other operating expenses
​	​		(86)	​	Provision (benefit) for income taxes
​	​	$	190	​	​

(1) These accumulated other comprehensive income (loss) components are included in the computation of net periodic pension cost. See Note 9 (“Pension and Other Postretirement Benefit Plans”) of the Notes to the Consolidated Financial Statements for additional information.

​

​

​

​

​

​

​

​

​

​

​

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Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

13.     Regulatory Capital

Under current capital regulations, the Bank is required to comply with four separate capital adequacy standards and a Capital Conservation Buffer (“CCB”). As of September 30, 2025, the Bank continues to be categorized as “well-capitalized” under the prompt corrective action regulations and continues to exceed all regulatory capital requirements. The CCB for the Bank was 6.02% and 5.11% at September 30, 2025 and December 31, 2024, respectively.

Set forth below is a summary of the Bank’s compliance with banking regulatory capital standards.

​

​	​	​	​	​	​	​	​	​	​	​	​
​		September 30, 2025					December 31, 2024
​	​	​	​	​	Percent of	​	​	​	​	Percent of
​		Amount			Assets		Amount			Assets
​		(Dollars in thousands)									​
Tier I (leverage) capital:		​					​				​
Capital level	​	$	895,465		10.30	%	$	847,588		9.31	%
Requirement to be well-capitalized	​		434,841		5.00	​		455,335		5.00	​
Excess	​		460,624		5.30	​		392,253		4.31	​
​	​	​	​	​	​	​	​	​	​	​	​
Common Equity Tier I risk-based capital:	​					​					​
Capital level	​	$	895,465		13.38	%	$	847,588		12.51	%
Requirement to be well-capitalized	​		435,047		6.50	​		440,259		6.50	​
Excess	​		460,418		6.88	​		407,329		6.01	​
​	​	​	​	​	​	​	​	​	​	​	​
Tier I risk-based capital:	​					​					​
Capital level	​	$	895,465		13.38	%	$	847,588		12.51	%
Requirement to be well-capitalized	​		535,442		8.00	​		541,857		8.00	​
Excess	​		360,023		5.38	​		305,731		4.51	​
​	​	​	​	​	​	​	​	​	​	​	​
Total risk-based capital:	​					​					​
Capital level	​	$	938,033		14.02	%	$	887,902		13.11	%
Requirement to be well-capitalized	​		669,303		10.00	​		677,321		10.00	​
Excess	​		268,730		4.02	​		210,581		3.11	​

​

​

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Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

The Company is subject to the same regulatory capital requirements as the Bank. As of September 30, 2025, the Company continues to be categorized as “well-capitalized” under the prompt corrective action regulations and continues to exceed all regulatory capital requirements. The CCB for the Company at September 30, 2025 and December 31, 2024 was 5.23% and 4.82%, respectively.

Set forth below is a summary of the Company’s compliance with banking regulatory capital standards.

​

​	​	​	​	​	​	​	​	​	​	​	​
​		September 30, 2025					December 31, 2024
​	​	​	​	​	Percent of	​	​	​	​	Percent of
​		Amount			Assets		Amount			Assets
​	​	(Dollars in thousands)
Tier I (leverage) capital:		​					​				​
Capital level	​	$	751,258		8.64	%	$	731,958		8.04	%
Requirement to be well-capitalized	​		434,790		5.00	​		455,297		5.00	​
Excess	​		316,468		3.64	​		276,661		3.04	​
​	​	​	​	​	​	​	​	​	​	​	​
Common Equity Tier I risk-based capital:	​		​			​		​			​
Capital level	​	$	703,450		10.51	%	$	685,004		10.13	%
Requirement to be well-capitalized	​		434,982		6.50	​		439,533		6.50	​
Excess	​		268,468		4.01	​		245,471		3.63	​
​	​	​	​	​	​	​	​	​	​	​	​
Tier I risk-based capital:	​		​			​		​			​
Capital level	​	$	751,258		11.23	%	$	731,958		10.82	%
Requirement to be well-capitalized	​		535,363		8.00	​		540,964		8.00	​
Excess	​		215,895		3.23	​		190,994		2.82	​
​	​	​	​	​	​	​	​	​	​	​	​
Total risk-based capital:	​		​			​		​			​
Capital level	​	$	983,826		14.70	%	$	962,272		14.23	%
Requirement to be well-capitalized	​		669,204		10.00	​		676,205		10.00	​
Excess	​		314,622		4.70	​		286,067		4.23	​

​

​

​

​

14.     Segment Reporting

The Company operates as a single unit, therefore, for the purpose of segment reporting we consider the Company as a single reportable segment, a community bank. The Bank revenues are derived principally from interest on loans, our mortgage-backed securities portfolio, and interest and dividends on other investments in our securities portfolio. We also generate non-interest income from loan fees, service charges on deposit accounts, mortgage servicing fees, and other fees, income earned on BOLI, dividends on FHLB-NY stock and net gains and losses on sales of securities and loans.

The Bank’s chief operating decision maker (“CODM”) is the senior executive committee that includes, but is not limited to, the chief executive officer, chief financial officer, and the chief operating officer. The CODM uses net income (loss) as the measure of segment performance to evaluate the income generated from assets (return on assets) and to evaluate how efficiently the Company leverages its shareholders equity (return on equity) in deciding the most appropriate avenue to reinvest profits.

​

As we consider the entire entity as one operating segment, please see the Consolidated Statements of Operations for the measure of segment performance, net income (loss) and significant segment expenses. Segment assets are consistent with total assets as presented on the Consolidated Statements of Financial Condition.

​

​

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Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

The following table presents consolidated net income (loss) and other important metrics the CODM will use to evaluate the operations of the Company:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

For the three months ended September 30,

​

For the nine months ended September 30,

​

​

2025

2024

2025

2024

​

​

(Dollars in thousands, except per share data)

Net income (loss)

$

10,447

​

$

8,906

​

​

$

14,854

​

$

17,912

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Diluted earnings (loss) per common share

$

0.30

​

$

0.30

​

​

$

0.43

​

$

0.60

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Return on average assets

0.48

%

0.39

%

​

0.22

%

0.27

%

Return on average equity

5.86

%

5.30

%

​

2.76

%

3.57

%

Book value per common share

$

21.06

​

$

22.94

​

​

$

21.06

​

$

22.94

​

​

​

15.     New Authoritative Accounting Pronouncements

Accounting Standards: Adopted in 2025

​

In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures”.  This ASU requires that public business entities on an annual basis (1) disclose specific categories in the rate reconciliation and (2) provide additional information for reconciling items that meet a quantitative threshold.  The ASU requires all entities disclose on an annual basis (1) the amount of income taxes paid, disaggregated by federal, state and foreign taxes and (2) the amount of income taxes paid disaggregated by individual jurisdictions in which income taxes paid is equal or greater than five percent of total income taxes paid.  The ASU also requires that all entities disclose (1) income (loss) from continuing operations before income tax expense (or benefit) disaggregated between domestic or foreign and (2) income tax expense (or benefit) from continuing operations disaggregated by federal (national), state and foreign.  This ASU is effective for public business entities for annual periods beginning after December 15, 2024.  On January 1, 2025, the Company adopted ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires, among other things, greater disaggregation of information in the income tax rate reconciliation and for paid income taxes to be disaggregated by jurisdiction. This ASU affects financial statement disclosure only, which is not required until year end 2025 and, as a result, does not affect our results of operations or financial condition.

​

Accounting Standards: Pending Adoption

​

In November 2024, the FASB issued ASU No. 2024-03, “Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40)”. This ASU requires that public business entities on an interim and annual basis (1) disclose the amounts of (a) purchases of inventory, (b) employee compensation, (c) depreciation, (d) intangible asset amortization, and (e) depreciation, depletion, and amortization recognized as part of oil and gas-producing activities (DD&A) (or other amounts of depletion expense) included in each relevant expense caption, which relevant expense caption is an expense caption presented on the face of the income statement within continuing operations that contains any of the expense categories listed in (a) - (e). (2) include certain amounts that are already required to be disclosed under current generally accepted accounting principles (GAAP) in the same disclosure as the other disaggregation requirements. (3) disclose a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively, and (4) disclose the total amount of selling expenses and, in annual reporting periods, an entity’s definition of selling expenses. This ASU is effective for public business entities for annual periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027.  We are currently evaluating if the adoption of this ASU will have a material effect on our consolidated financial statements.

​

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Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

​

ITEM 2.        MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This Quarterly Report should be read in conjunction with the more detailed and comprehensive disclosures included in our Annual Report on Form 10-K for the year ended December 31, 2024. In addition, please read this section in conjunction with our Consolidated Financial Statements and Notes to Consolidated Financial Statements contained herein.

As used in this Quarterly Report, the words “we,” “us,” “our” and the “Company” are used to refer to Flushing Financial Corporation and its direct and indirect wholly owned subsidiaries, Flushing Bank (the “Bank”), Flushing Service Corporation, and FSB Properties Inc.

Statements contained in this Quarterly Report relating to plans, strategies, objectives, economic performance and trends, projections of results of specific activities or investments and other statements that are not descriptions of historical facts may be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking information is inherently subject to risks and uncertainties and actual results could differ materially from those currently anticipated due to a number of factors, which include, but are not limited to, factors discussed elsewhere in this Quarterly Report and in other documents filed by us with the Securities and Exchange Commission from time to time, including, without limitation, our Annual Report on Form 10-K for the year ended December 31, 2024. Forward-looking statements may be identified by terms such as “may,” “will,” “should,” “could,” “expects,” “plans,” “intends,” “anticipates,” “believes,” “estimates,” “predicts,” “forecasts,” “goals,” “potential” or “continue” or similar terms or the negative of these terms. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. We have no obligation to update these forward-looking statements.

Executive Summary

We are a Delaware corporation organized in May 1994. The Bank was organized in 1929 as a New York State-chartered mutual savings bank. Today the Bank operates as a full-service New York State-chartered commercial bank. The Bank’s primary regulator is the New York State Department of Financial Services, and its primary federal regulator is the Federal Deposit Insurance Corporation (“FDIC”). Deposits are insured to the maximum allowable amount by the FDIC. Additionally, the Bank is a member of the Federal Home Loan Bank system. The primary business of Flushing Financial Corporation has been the operation of the Bank. At September 30, 2025, the Bank owns two subsidiaries: Flushing Service Corporation and FSB Properties Inc. The Bank also operates an internet branch, which operates under the brands of iGObanking.com® and BankPurely® (the “Internet Branch”). The activities of Flushing Financial Corporation are primarily funded by dividends, if any, received from the Bank, issuances of subordinated debt, junior subordinated debt, and issuances of equity securities. Flushing Financial Corporation’s common stock is traded on the NASDAQ Global Select Market under the symbol “FFIC.”

Our principal business is attracting retail deposits from the general public and investing those deposits together with funds generated from ongoing operations and borrowings, primarily in (1) originations and purchases of multi-family residential loans, commercial business loans, commercial real estate mortgage loans and, to a lesser extent, one-to-four family loans (focusing on mixed-use properties, which are properties that contain both residential dwelling units and commercial units); (2) Small Business Administration (“SBA”) loans and other small business loans; (3) construction loans; (4) mortgage loan surrogates such as mortgage-backed securities; and (5) U.S. government securities, corporate fixed-income securities and other marketable securities. We also originate certain other consumer loans including overdraft lines of credit. Our results of operations depend primarily on net interest income, which is the difference between the income earned on our interest-earning assets and the cost of our interest-bearing liabilities. Net interest income is the result of our net interest rate margin, which is the difference between the average yield earned on interest-earning assets and the average cost of

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​

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

interest-bearing liabilities, adjusted for the difference in the average balance of interest-earning assets as compared to the average balance of interest-bearing liabilities. We also generate non-interest income primarily from loan fees, service charges on deposit accounts, and other fees, income earned on Bank Owned Life Insurance (“BOLI”), dividends on Federal Home Loan Bank of New York (“FHLB-NY”) stock and net gains and losses on sales of securities and loans. Our operating expenses consist principally of employee compensation and benefits, occupancy and equipment costs, other general and administrative expenses and income tax expense. Our results of operations can also be significantly affected by changes in the fair value of financial assets and financial liabilities for which changes in value are recorded through earnings and our periodic provision for credit losses.

Our investment policy, which is approved by the Board of Directors, is designed primarily to manage the interest rate sensitivity of our overall assets and liabilities, to generate a favorable return without incurring undue interest rate risk and credit risk, to complement our lending activities and to provide and maintain liquidity. In establishing our investment strategies, we consider our business and growth strategies, the economic environment, our interest rate risk exposure, our interest rate sensitivity “gap” position, the types of securities to be held and other factors. We classify our investment securities as available for sale or held-to-maturity.

We carry a portion of our financial assets and financial liabilities under the fair value option and record changes in their fair value through earnings in non-interest income on our Consolidated Statements of Operations and Comprehensive Income. A description of the financial assets and financial liabilities that are carried at fair value through earnings can be found in Note 10 (“Fair Value of Financial Instruments”) of the Notes to the Consolidated Financial Statements.

For the three months ended September 30, 2025, we reported net income of $10.4 million, or $0.30 per diluted common share, an increase of $1.5 million, or 17.3% from net income of $8.9 million, or $0.30 per diluted common share earned in the three months ended September 30, 2024.

​

During the three months ended September 30, 2025, the net interest margin increased 54 basis points to 2.64% from 2.10% in the three months ended September 30, 2024. Excluding prepayment penalty income from loans, net recoveries/reversals of interest from non-accrual and delinquent loans, net gains (losses) from fair value adjustments on hedges, and purchase accounting adjustments, the net interest margin increased 56 basis points to 2.55% for the three months ended September 30, 2025, from 1.99% for the three months ended September 30, 2024.

Approximately 91% of our loan portfolio is collateralized by real estate with an average loan to value of less than 35%, based on appraisal at origination. We have a long history and foundation built upon disciplined underwriting, strong credit quality, and a resilient seasoned loan portfolio with solid asset protection. At September 30, 2025, our allowance for credit losses (“ACL”) to gross loans stood at 0.63% and our ACL to non-performing loans was 93.3%. Non-performing assets at the end of the quarter were 0.70% of total assets.

The Bank and Company remain well-capitalized under current capital regulations of the FDIC and the Federal Reserve Board, respectively, and are subject to similar regulatory capital requirements. See Note 13 (“Regulatory Capital”) of the Notes to the Consolidated Financial Statements.

​

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Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

The following table presents operating data highlights for the periods indicated:

​

​	​	​	​	​	​	​
​	​	For the three months ended September 30,
​		2025			2024
​	​	(In thousands, except per share data)
Operating data:		​			​
Interest and dividend income	​	$	116,469	​	$	122,593
Interest expense	​		62,641	​		76,990
Net interest income (loss)	​		53,828	​		45,603
Provision (benefit) for credit losses	​		1,531	​		1,727
Non-interest income (loss)	​		4,746	​		6,277
Non-interest expense	​		43,365	​		38,696
Income (loss) before income taxes	​		13,678	​		11,457
Provision (benefit) for income taxes	​	​	3,231	​	​	2,551
Net income (loss)	​	$	10,447	​	$	8,906
​	​	​	​	​	​	​
Basic earnings (loss) per common share	​	$	0.30	​	$	0.30
Diluted earnings (loss) per common share	​	​	0.30	​	​	0.30
Dividends per common share	​	$	0.22	​	$	0.22

​

COMPARISON OF OPERATING RESULTS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2025 AND 2024

General. Net income for the three months ended September 30, 2025 was $10.4 million, an increase of $1.5 million, or 17.30%, from $8.9 million for the three months ended September 30, 2024. Diluted earnings per common share was $0.30 for both the three months ended September 30, 2025, and 2024. Return on average equity was 5.86% for the three months ended September 30, 2025 compared to 5.30% for the three months ended September 30, 2024. Return on average assets was 0.48% for the three months ended September 30, 2025 compared to 0.39% for the three months ended September 30, 2024.

Interest Income. Interest and dividend income decreased $6.1 million, or 5.0%, to $116.5 million for the three months ended September 30, 2025, from $122.6 million for the three months ended September 30, 2024. The decline in interest income was primarily attributable to a decrease of $528.1 million in the average balance of interest-earning assets to $8,181.6 million for the three months ended September 30, 2025, from $8,709.7 million for the comparable prior year period, partially offset by a 7 basis point increase in the yield on interest-earning assets to 5.70% for the three months ended September 30, 2025, compared to 5.63% for the three months ended September 30, 2024. The decline in interest-earning assets was primarily driven by our decision to maintain pricing and credit discipline. Excluding prepayment penalty income from loans, net recoveries/reversals of interest from non-accrual and delinquent loans, net gains (losses) from fair value adjustments on hedges, and purchase accounting adjustments, the yield on total interest-earning assets increased 8 basis points to 5.61% for the three months ended September 30, 2025, from 5.53% for the three months ended September 30, 2024.

Interest Expense. Interest expense decreased $14.3 million, or 18.6%, to $62.6 million for the three months ended September 30, 2025, from $77.0 million for the three months ended September 30, 2024. The decline in interest expense was primarily due to the average cost of interest-bearing liabilities decreasing 48 basis points to 3.62% for the three months ended September 30, 2025, from 4.10% for the three months ended September 30, 2024, coupled with the average balance of interest-bearing liabilities decreasing $580.9 million to $6,923.6 million for the three months ended September 30, 2025, from $7,504.5 million for the comparable prior year period.

Net Interest Income. Net interest income for the three months ended September 30, 2025, was $53.8 million, an increase of $8.2 million, or 18.0%, from $45.6 million for the three months ended September 30, 2024. The increase in net interest

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Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

income was driven by an increase in the net interest margin of 54 basis points to 2.64% for the three months ended September 30, 2025, from 2.10% for the three months ended September 30, 2024. The net interest margin, excluding the items noted above in Interest Income, was 2.55% for the three months ended September 30, 2025, an increase of 56 basis points from 1.99% for the three months ending September 30, 2024.

​

Provision for Credit Losses. During the three months ended September 30, 2025, the provision for credit losses was $1.5 million compared to $1.7 million for the three months ended September 30, 2024. The provision recorded during the three months ended September 30, 2025 was primarily driven by net charge offs and an increase in reserves applied to one Business Banking loan. The current average loan-to-value ratio for our non-performing assets collateralized by real estate was 61.5% at September 30, 2025. The Bank continues to maintain conservative underwriting standards.

Non-Interest Income. Non-interest income for the three months ended September 30, 2025, was $4.7 million, a decrease of $1.5 million, or 24.4% from $6.3 million in the prior year comparable period. The decrease was primarily due to net losses from fair value adjustments recorded during the three months ended September 30, 2025, compared to net gains recorded during the three months ended September 30, 2024. This was partially offset by higher BOLI income and net gains on sale of securities during the three months ended September 30, 2025 compared to the three months ended September 30, 2024. The improvement in BOLI income resulted from the exchange of lower yielding policies for higher yielding policies.

Non-Interest Expense. Non-interest expense for the three months ended September 30, 2025, was $43.4 million, an increase of $4.7 million, or 12.1%, from $38.7 million for the three months ended September 30, 2024. The increase was primarily due to higher costs in multiple expense categories.

Income before Income Taxes. Income before income taxes for the three months ended September 30, 2025, was $13.7 million, an increase of $2.2 million, or 19.4%, from $11.5 million for the three months ended September 30, 2024 for the reasons discussed above.

Provision for Income Taxes. The provision for income taxes was $3.2 million for the three months ended September 30, 2025, an increase of $0.7 million, or 26.7%, from $2.6 million for the three months ended September 30, 2024. The effective tax rate for the three months ended September 30, 2025 was 23.6% compared to 22.3% for the three months ended September 30, 2024.

The following table presents operating data highlights for the periods indicated:

​	​	​	​	​	​	​
​		For the nine months ended September 30,
​		2025			2024
​	​	(In thousands except per share data)
Operating data:		​			​
Interest and dividend income	​	$	350,407	​	$	345,322
Interest expense	​		190,381	​		214,546
Net interest income (loss)	​		160,026	​		130,776
Provision (benefit) for credit losses	​		10,043	​		3,128
Non-interest income (loss)	​		20,097	​		13,577
Non-interest expense	​		143,397	​		117,635
Income (loss) before income taxes	​		26,683	​		23,590
Provision (benefit) for income taxes	​		11,829	​		5,678
Net income (loss)	​	$	14,854	​	$	17,912
​	​	​	​	​	​	​
Basic earnings (loss) per common share	​	$	0.43	​	$	0.60
Diluted earnings (loss) per common share	​	​	0.43	​	​	0.60
Dividends per common share	​	$	0.66	​	$	0.66

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Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

​

COMPARISON OF OPERATING RESULTS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2025 AND 2024

General. Net income for the nine months ended September 30, 2025 was $14.9 million, a decrease of $3.1 million, or 17.1%, from $17.9 million for the nine months ended September 30, 2024. Diluted earnings per common share were $0.43 for the nine months ended September 30, 2025, a decrease of $0.17, or 28.3%, from $0.60 for the nine months ended September 30, 2024. Return on average equity was 2.76% for the nine months ended September 30, 2025 compared to 3.57% for the nine months ended September 30, 2024. Return on average assets was 0.22% for the nine months ended September 30, 2025 compared to 0.27% for the nine months ended September 30, 2024.

​

The primary reason for the decrease in net income, diluted earnings per share, return on average assets and return on average equity was due to the Company recording a non-cash, non-tax deductible impairment charge on its entire goodwill balance totaling $17.6 million during the nine months ended September 30, 2025.

Interest Income. Interest and dividend income increased $5.1 million, or 1.5%, to $350.4 million for the nine months ended September 30, 2025 from $345.3 million for the nine months ended September 30, 2024. The increase in interest income was primarily attributable to a 14 basis point increase in the yield on interest-earning assets to 5.60% for the nine months ended September 30, 2025 compared to 5.46% for the nine months ended September 30, 2024, partially offset by the average balance of total interest-earning assets which decreased $84.3 million from the comparable prior year period. Excluding prepayment penalty income from loans, net recoveries/reversals of interest from non-accrual loans, net gains (losses) from fair value adjustments on hedges, and purchase accounting adjustments, the yield on total interest-earning assets increased 14 basis points to 5.54% for the nine months ended September 30, 2025 from 5.40% for the nine months ended September 30, 2024.

​

Interest Expense. Interest expense decreased $24.2 million, or 11.3%, to $190.4 million for the nine months ended September 30, 2025 from $214.5 million for the nine months ended September 30, 2024. The decrease in interest expense was primarily due to a decrease of 39 basis points in the average cost of interest-bearing liabilities to 3.57% for the nine months ended September 30, 2025 from 3.96% for the nine months ended September 30, 2024. In addition, there was a decrease of $101.7 million in the average balance of interest-bearing liabilities to $7,119.1 million for the nine months ended September 30, 2025 from $7,220.9 million for the comparable prior year period.  

​

Net Interest Income. Net interest income for the nine months ended September 30, 2025 was $160.0 million, an increase of $29.3 million, or 22.4%, from $130.8 million for the nine months ended September 30, 2024. The increase in net interest income was driven by the net interest margin increasing 49 basis points to 2.56% for the nine months ended September 30, 2025 from 2.07% for the nine months ended September 30, 2024. The net interest margin, excluding the items noted above in Interest Income, was 2.50% for the nine months ended September 30, 2025, an increase of 49 basis points from 2.01% for the nine months ending September 30, 2024.

 ​

Provision for Credit Losses. During the nine months ended September 30, 2025, the provision for credit losses was $10.0 million compared to $3.1 million for the nine months ended September 30, 2024. The provision recorded during the nine months ended September 30, 2025, was primarily due to reserves on one commercial real estate loan which lost its primary tenant, increased reserves applied to three Business Banking loans, one Multi-Family loan and one Commercial Real Estate loan, coupled with net charges-offs. The current average loan-to-value ratio for our non-performing assets collateralized by real estate was 61.5% at September 30, 2025. The Bank continues to maintain conservative underwriting standards.

​

Non-Interest Income. Non-interest income for the nine months ended September 30, 2025 was $20.1 million, an increase of $6.5 million, or 48.0% from $13.6 million in the prior year comparable period. The increase was primarily due to increases in net gain on sale of loans and BOLI income during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The increase in net gain on sale of loans was driven by the reversal of a

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PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

previously recorded valuation allowance upon the reclassification of loans held for sale to loans held for investment during the nine months ended September 30, 2025, as Management decided not to sell the performing loans. The improvement in BOLI income resulted from the exchange of lower yielding policies for higher yielding policies.

​

Non-Interest Expense. Non-interest expense for the nine months ended September 30, 2025 was $143.4 million, an increase of $25.8 million, or 21.9%, from $117.6 million for the nine months ended September 30, 2024. The increase was primarily due to the recording of a non-cash non-tax deductible goodwill impairment charge of all goodwill outstanding totaling $17.6 million during the nine months ended September 30, 2025. The remainder of the growth in non-interest expense was primarily due to higher costs in multiple expense categories.

​

Income before Income Taxes. Income before income taxes for the nine months ended September 30, 2025 was $26.7 million, an increase of $3.1 million, or 13.1%, from $23.6 million for the nine months ended September 30, 2024 for the reasons discussed above.

​

Provision for Income Taxes. The provision for income taxes was $11.8 million for the nine months ended September 30, 2025, an increase of $6.2 million, or 108.3%, from $5.7 million for the nine months ended September 30, 2024. The effective tax rate for the nine months ended September 30, 2025 was 44.3% compared to 24.1% for the nine months ended September 30, 2024. The higher effective tax rate for the nine months ended September 30, 2025 was primarily related to the non-tax deductible goodwill impairment and the settlement of income tax audits.

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Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

FINANCIAL CONDITION

Assets. Total assets at September 30, 2025, were $8,872.0 million, a decrease of $167.0 million, or 1.8%, from $9,039.0 million at December 31, 2024. The decrease in total assets was mainly due to total net loans held for investment decreasing $77.2 million, or 1.2%, during the nine months ended September 30, 2025, to $6,628.5 million from $6,705.7 million at December 31, 2024, coupled with a decrease during the same period in loans held for sale totaling $70.1 million. The decrease in loans was primarily due to the Company maintaining pricing and credit discipline. Loan originations and purchases were $586.0 million for the nine months ended September 30, 2025, an increase of $113.0 million, or 23.9%, from $473.0 million for the nine months ended September 30, 2024. The loan pipeline was $345.6 million at September 30, 2025, compared to $198.9 million at December 31, 2024.

The following table shows loan originations and purchases for the periods indicated:

​

​	​	​	​	​	​	​	​	​	​	​	​	​
​		For the three months ended						For the nine months ended
​		September 30,					​	September 30,
(In thousands)		2025			2024			2025			2024
Multi-family residential	​	$	17,674	​	$	50,528		$	47,403	​	$	90,299
Commercial real estate	​		40,199	​		56,713		​	120,648	​	​	87,326
One-to-four family – mixed-use property	​		3,580	​		5,709		​	8,461	​	​	10,439
One-to-four family – residential (1)	​		86,589	​		1,705		​	122,206	​	​	54,933
Construction	​		4,839	​		5,063		​	10,583	​	​	11,552
Small Business Administration	​		528	​		5,930		​	4,235	​	​	5,930
Commercial business and other (2)	​		99,351	​		91,447		​	272,476	​		212,564
Total	​	$	252,760	​	$	217,095	​	$	586,012	​	$	473,043

(1) Includes purchases of $86.4 million for the three months ended September 30, 2025. Includes purchases of $121.5 million and $52.3 million for the nine months ended September 30, 2025 and 2024, respectively.

(2) Includes purchases of $49.8 million and $33.6 million for the three months ended September 30, 2025 and 2024, respectively. Includes purchases of $92.1 million and $78.0 million for the nine months ended September 30, 2025 and 2024, respectively.

​

​

The Bank maintains its conservative underwriting standards that include, among other things, a loan-to-value ratio of 75% or less and a debt coverage ratio of at least 125%. Multi-family residential (excluding underlying co-operative mortgages), commercial real estate and one-to-four family mixed-use property mortgage loans originated and purchased during the three months ended September 30, 2025 had an average loan-to-value ratio of 43.0% and an average debt coverage ratio of 172.0%.

Non-performing assets totaled $62.1 million at September 30, 2025, an increase of $10.8 million, or 21.1% from December 31, 2024. Total non-performing assets as a percentage of total assets were 0.70% at September 30, 2025 compared to 0.57% at December 31, 2024. The ratio of ACL – loans to total non-performing loans was 93.3% at September 30, 2025 compared to 120.5% at December 31, 2024.

During the nine months ended September 30, 2025, mortgage-backed securities decreased $5.4 million, or 0.6%, to $914.1 million from $919.5 million at December 31, 2024. The decrease during the nine months ended September 30, 2025 was primarily due to principal repayments totaling $123.6 million, coupled with sales totaling $80.7 million at an average yield of 5.29%, partially offset by purchases of securities totaling $192.0 million at an average yield of 5.27% and an improvement in the securities fair value totaling $7.0 million.

During the nine months ended September 30, 2025, other securities increased $47.9 million, or 7.6%, to $677.8 million from $629.9 million at December 31, 2024. The increase in other securities during the nine months ended September 30, 2025, was primarily due to purchases totaling $193.4 million, at an average yield of 6.08%, partially offset by calls totaling

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Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

$132.1 million and principal repayments totaling $16.0 million. At September 30, 2025, other securities primarily consisted of securities issued by mutual or bond funds, government agency securities, municipal bonds, corporate bonds, and CLOs.

Liabilities. Total liabilities were $8,160.8 million at September 30, 2025, a decrease of $153.7 million, or 1.8%, from $8,314.4 million at December 31, 2024. During the nine months ended September 30, 2025, Due to Depositors increased $207.0 million, or 2.9%, to $7,332.8 million primarily due to increases in NOW and money market accounts totaling $317.8 million, or 9.0% and non-interest bearing accounts of $128.2 million, or 15.3%. These increases were partially offset by a decrease in certificates of deposit accounts totaling $231.1 million, or 8.7%. At September 30, 2025, the Company had uninsured deposits totaling $2.6 billion, or 34.6% of deposits of which $1.3 billion was fully collateralized by some other method leaving uninsured and uncollateralized deposits totaling $1.3 billion, or 17.0% of deposits. Uninsured deposits are greatly influenced by our government deposit portfolio. These deposits fluctuate at times that affect both the uninsured deposit levels and other sources of liquidity used. Borrowed funds decreased $423.6 million, or 46.2%, during the nine months ended September 30, 2025, as funds were not needed due to increases in deposits and decreases in loans.

Total deposits at the periods shown and the weighted average rate on deposits at September 30, 2025 and December 31, 2024, are as follows:

​	​	​	​	​	​	​	​	​	​
​	​	​					​	Weighted Average	​
​	​	September 30,		​	December 31,		​	Nominal Rate	​
​		2025			2024			2025 (1)	​
​	​	(In thousands)
Interest-bearing deposits:	​	​	​	​	​	​	​	​	​
Certificates of deposit accounts	​	$	2,419,039	​	$	2,650,164	​	4.05	%
Savings accounts	​		91,089	​		98,964	​	0.41	​
Money market accounts	​		1,714,184	​		1,686,109	​	3.57	​
NOW accounts	​		2,143,752	​		1,854,069	​	3.35	​
Total interest-bearing deposits	​		6,368,064	​		6,289,306	​		​
Non-interest bearing demand deposits	​		964,767	​		836,545	​		​
Total due to depositors	​		7,332,831	​		7,125,851	​		​
Mortgagors' escrow deposits	​		82,697	​		53,082	​	0.28	​
Total deposits	​	$	7,415,528	​	$	7,178,933	​		​

(1) The weighted average rate does not reflect the effect of interest rate swaps.

​

Included in deposits were brokered deposits totaling $1,180.4 million, a decrease of $138.6 million, or 10.5% from $1,319.0 million at December 31, 2024. We utilize brokered deposits as an additional funding source, to assist in the management of our interest rate risk and as an underlying funding source for a portion of our interest rate swaps. We obtain brokered certificates of deposit as a wholesale funding source when the interest rate on these deposits are below other wholesale options, or to extend the maturities of our deposits. Brokered deposits generally have a higher beta than our retail deposits as the interest rates are typically more sensitive to changes in the federal funds rates. A portion of our brokered certificates of deposit are hedged against rising interest rates using interest rate swaps. At September 30, 2025 and December 31, 2024, $725.8 million and $875.8 million, respectively, of brokered certificates of deposits were hedged using interest rate swaps. See Note 11 (“Derivative Financial Instruments”) of the Notes to the Consolidated Financial Statements. Brokered deposits obtained by the Bank are generally fully FDIC insured. At September 30, 2025, and December 31, 2024, the Bank did not hold any uninsured brokered deposits.

​

​

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PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

The following table shows the composition of brokered deposits at the periods indicated:

​

​	​	​	​	​	​	​
​	​	September 30,		​	December 31,
(In thousands)	​	2025		​	2024
NOW accounts	​	$	299,937	​	$	151,387
Money market accounts	​		—	​		73,622
Certificates of deposit	​	​	880,441	​	​	1,093,996
Total brokered deposits	​	$	1,180,378	​	$	1,319,005

​

​

Interest expense on brokered deposits is summarized as follows for the periods indicated:

​

​	​	​	​	​	​	​
​	​	For the three months ended September 30,
(In thousands)		2025			2024
NOW accounts	​	$	2,968	​	$	694
Money market accounts	​		—	​		214
Certificates of deposit	​	​	7,198	​	​	12,027
Total interest expense on brokered deposits	​	$	10,166	​	$	12,935

​

​	​	​	​	​	​	​
​	​	For the nine months ended September 30,
(In thousands)	​	2025		​	2024
NOW accounts	​	$	7,386	​	$	908
Money market accounts	​		551	​		1,099
Certificates of deposit	​	​	21,342	​	​	22,916
Total brokered deposits	​	$	29,279	​	$	24,923

​

Equity. Total stockholders’ equity was $711.2 million at September 30, 2025, a decrease of $13.3 million, or 1.8%, from $724.5 million at December 31, 2024. Stockholders’ equity decreased primarily due to the declaration and payment of dividends on the Company’s common stock of $0.66 per common share totaling $22.7 million, and a decrease of $7.1 million in other comprehensive income (loss), partially offset by net income totaling $14.9 million. Book value per common share was $21.06 at September 30, 2025, compared to $21.53 at December 31, 2024.

Liquidity. Liquidity is the ability to economically meet current and future financial obligations. The Company’s primary objectives in terms of managing liquidity are to maintain the ability to originate and purchase loans and securities, repay borrowings as they mature, satisfy financial obligations that arise in the normal course of business and meet our customer’s deposit withdrawal needs. Our primary sources of funds are deposits, borrowings, principal and interest payments on loans, mortgage-backed and other securities, and proceeds from sales of securities and loans. Deposit flows and mortgage prepayments, however, are greatly influenced by the level of interest rates, economic conditions, and competition. The Company has other sources of liquidity, including unsecured overnight lines of credit, brokered deposits and other types of borrowings. At September 30, 2025 and December 31, 2024, the Company had $3.9 billion and $3.6 billion, respectively, in combined available liquidity through cash lines with the FHLB-NY, Federal Reserve and other commercial banks, as well as unencumbered securities.

​

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Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

The following tables present the Company’s available liquidity by source at the periods indicated:

​

​	​	​	​	​	​	​	​	​	​
​	​	At September 30, 2025
​	​	Total		​	Amount		​	Net
​		Available			Used			Availability
​	​	(In millions)
Internal Sources:		​			​			​
Unencumbered Securities	​	$	914.6	​	$	—	​	$	914.6
Interest Earnings Deposits	​		65.4	​		—	​		65.4
External Sources:	​		​	​		​	​		​
Federal Home Loan Bank	​		2,633.0	​		1,704.8	​		928.2
Federal Reserve Bank	​		1,496.4	​		—	​		1,496.4
Other Banks	​		527.0	​		70.0	​		457.0
Total Liquidity	​	$	5,636.4	​	$	1,774.8	​	$	3,861.6
​	​	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​
​	​	At December 31, 2024
​	​	Total		​	Amount		​	Net
​		Available			Used			Availability
​	​	(In millions)
Internal Sources:		​			​			​
Unencumbered Securities	​	$	954.3	​	$	—	​	$	954.3
Interest Earnings Deposits	​		57.4	​		—	​		57.4
External Sources:	​		​	​		​	​		​
Federal Home Loan Bank	​		2,730.3	​		2,034.7	​		695.6
Federal Reserve Bank	​		1,528.9	​		—	​		1,528.9
Other Banks	​		379.0	​		50.0	​		329.0
Total Liquidity	​	$	5,649.9	​	$	2,084.7	​	$	3,565.2

​

Liquidity management is both a short and long-term function of business management. During 2025, funds were provided by the Company’s operating and investing activities to fund financing activities. The largest uses of funds during the nine months ended September 30, 2025 were the repayment of $425.0 million in short-term borrowed funds, the purchase of $340.3 million of securities available for sale and the purchase of $213.6 million of loans. These uses were primarily funded by sales, calls and repayments of securities totaling $352.5 million, net repayments of loans totaling $291.4 million and an increase in deposits totaling $235.9 million. Our most liquid assets are cash and cash equivalents, which include cash and due from banks, overnight interest-earning deposits and federal funds sold with original maturities of 90 days or less. The level of these assets is dependent on our operating, financing, lending, and investing activities during any given period. At September 30, 2025, cash and cash equivalents totaled $142.9 million, a decrease of $9.6 million, or 6.3% from $152.6 million, at December 31, 2024. A portion of our cash and cash equivalents is restricted cash held as collateral for interest rate swaps. At September 30, 2025, and December 31, 2024, restricted cash totaled $17.3 million and $43.2 million, respectively.

INTEREST RATE RISK

Interest rate risk is the impact on earnings and capital from changes in interest rates. Interest rate risk exists because our interest-earning assets and interest-bearing liabilities may mature or reprice at different times or by different amounts. We assess interest rate risk by comparing the results of several income and capital simulations scenarios to the base case compared to scenarios with changes in interest rates, degree of change over time, speed of change, and changes in the shape of the yield curve. These scenarios have assumptions including loan originations, investment securities purchases and sales, prepayment rates on loans and investment securities, deposit flows, and mix and pricing decisions.

Asset/Liability Management. Asset/liability management involves assessing, monitoring and managing interest rate risk. The asset liability committee (“ALCO”) and the Investment Committee of the Board of Directors (“Board ALCO”) have primary oversight responsibility of interest rate risk. The actions and activities of the Board ALCO are dictated by the

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PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

“ALCO and Investment Committee Charter” of the Company Board of Directors (the “Charter”). The Board ALCO has established policy limits for changes of net interest income and the economic value of equity under various scenarios and liquidity risk limits to ensure the Company has sufficient liquid assets to meet its short-term obligations, even during periods of financial stress and is reviewed no less frequently than quarterly. The ALCO policy and oversight is interconnected to the Company’s capital plan.

The Board ALCO reviews simulations of various interest rate scenarios to assess the potential impact on the Company’s balance sheet and income statement. The model employed by the Company uses a statistic balance sheet as of the date the modeling is being generated. The limitation to this model is that unexpected events may not be captured in the output. The model is validated no less frequently than annually with the variables in the model subjected to annual stress tests. In addition, the interest rate risk model is back-tested no less frequently than annually to ensure the model remains consistent with actual results. The information from the interest rate risk modeling allows the Board ALCO to assess the potential impact of interest rate changes on the Company’s profitability and future earnings.

The interest rate risk scenarios affect the position the Company may take with the pricing of assets and liabilities.

Models are inherently imperfect and subject to assumptions and limitations.  The model output is affected by the data quality and the assumptions used.  The Company uses both internal and external inputs into the model. The market interest rates are obtained from the Federal Reserve World Interest Rate Probabilities (“WIRP”) curve and may be adjusted by the management level ALCO committee (“Management ALCO”); the change in deposit betas is based upon deposit studies completed by an independent third party; loan prepayment assumptions are based upon internal analysis; loan origination data is Company generated; and additions to assets and liabilities is derived from the budget or forecast or internally generated projected cash flows.

There was no material change in the source of the data used in our interest rate risk modeling in the current period. Current economic factors such as interest rate forecasts as changed from period over period may affect the modeling. Key assumptions include deposit betas and loan origination yields. Deposit betas vary by product and direction of interest rates. In an upward shock, weighted average deposit betas (based on period end balances) were 70% at September 30, 2025 and 71% at September 30, 2024. In a downward shock, weighted average deposit betas (based on period end balances) were 61% at September 30, 2025 and 63% at September 30, 2024. Loan origination yields vary by product and the weighted average yield (based on period end loan balances) was 6.54% at September 30, 2025 compared to 7.08% at September 30, 2024.

Management ALCO, which consists of representatives from treasury, finance, business units, and senior management, oversees the interest rate risk, liquidity risk and capital risk while providing regular reports to the Board ALCO. These reports quantify the potential changes in net interest income and economic value of equity through various rate scenarios.  The Management ALCO also provides the results of the liquidity stress test prepared by the Chief Risk Officer, the sensitivity analyses of the interest rate risk model variables, and the capital position of the Company and the Bank.

Economic Value of Equity Analysis. The Consolidated Statements of Financial Condition have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”), which require the measurement of financial position and operating results in terms of historical dollars without considering the changes in fair value of certain investments due to changes in interest rates. Generally, the fair value of financial investments such as loans and securities fluctuate inversely with changes in interest rates. As a result, increases in interest rates could result in decreases in the fair value of the Company’s interest-earning assets which could adversely affect the Company’s results of operations if such assets were sold, or, in the case of securities classified as available for sale, decreases in the Company’s stockholders’ equity, if such securities were retained.

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PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

The Company quantifies the net portfolio value should interest rates immediately go up or down 100 or 200 basis points, assuming the yield curves of the rate shocks will be parallel to each other. Net portfolio value is defined as the market value of assets less the market value of liabilities. The market value of assets and liabilities is determined using a discounted cash flow calculation. The net portfolio value ratio is the ratio of the net portfolio value to the market value of assets. The changes in value are measured as percentage changes from the net portfolio value at the base interest rate scenario. The base interest rate scenario assumes interest rates at September 30, 2025. Various estimates regarding prepayment assumptions are made at each level of rate shock. At September 30, 2025, the Company was within the guidelines set forth by the Board of Directors for each interest rate level.

​

The following table presents the change in the Company’s net portfolio value and the net portfolio ratio for the following periods:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Projected Percentage Change In

​

​

​

​

​

​

​

Net Portfolio Value (NPV)

​

Net Portfolio Value Ratio

​

​

September 30,

​

​

September 30,

​

​

September 30,

​

​

September 30,

​

Change in Interest Rate

​

2025

​

​

2024

​

​

2025

​

​

2024

​

-200 Basis points

​

6.7

%

​

(3.3)

%

​

9.0

%

​

5.4

%

-100 Basis points

​

2.9

​

​

(2.6)

​

​

8.9

​

​

5.5

​

Base interest rate

​

-

​

​

-

​

​

8.8

​

5.8

+100 Basis points

​

(5.4)

​

​

(4.9)

​

​

8.4

​

5.6

+200 Basis points

​

(11.9)

​

​

(9.0)

​

​

8.0

​

5.4

​

Income Simulation Analysis. The Company manages the mix of interest-earning assets and interest-bearing liabilities on a continuous basis to maximize return and adjust its exposure to interest rate risk. The starting point for the net interest income simulation is an estimate of the next twelve months’ net interest income, assuming that both interest rates and the Company’s interest-sensitive assets and liabilities remain at period-end levels. The report quantifies the potential changes in net interest income should interest rates go up or down 100 or 200 basis points (shocked), assuming the yield curves of the rate shocks will be parallel to each other. All changes in income are measured as percentage changes from the projected net interest income at the base interest rate scenario. The base interest rate scenario assumes interest rates at September 30, 2025 and 2024. Prepayment penalty income is excluded from this analysis. Actual results could differ significantly from these estimates. At September 30, 2025, the Company was within the guidelines set forth by the Board of Directors for each interest rate level.

The following table presents the Company’s interest rate shock as of September 30:

​	​	​	​	​	​	​
​	​	Projected Percentage Change in Net Interest Income				​
Change in Interest Rate	​	2025		​	2024
-200 Basis points	​	1.2	%	​	(1.8)	%
-100 Basis points	​	0.2	​	​	(0.4)	​
Base interest rate	​	-	​	​	-	​
+100 Basis points	​	(4.3)	​	​	(3.5)	​
+200 Basis points	​	(9.5)	​	​	(7.7)	​

​

Another net interest income simulation assumes that changes in interest rates change gradually in equal increments over the twelve-month period. Prepayment penalty income is excluded from this analysis. Based on these assumptions, net interest income would be reduced by 4.6% from a 200 basis point increase in rates over the next twelve months and a 0.4% increase from a 200 basis point decrease in rate over the same period. Actual results could differ significantly from these estimates.

​

At September 30, 2025, the Company had a derivative portfolio with a notional value totaling $2.8 billion. This portfolio is designed to provide protection against rising interest rates. See Note 11 (“Derivative Financial Instruments”) of the Notes to the Consolidated Financial Statements.

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PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

AVERAGE BALANCES

Net interest income represents the difference between income on interest-earning assets and expense on interest-bearing liabilities. Net interest income depends upon the relative amount of interest-earning assets and interest-bearing liabilities and the interest rates earned or paid on them. The following table sets forth certain information relating to the Company’s Consolidated Statements of Financial Condition and Consolidated Statements of Operations for the three months ended September 30, 2025 and 2024, and reflects the average yield on assets and average cost of liabilities for the periods indicated. Such yields and costs are derived by dividing income or expense by the average balance of assets or liabilities, respectively, for the periods shown. Average balances are derived from average daily balances. The yields include amortization of fees and costs, which are considered adjustments to yields.

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

For the three months ended September 30,

​

​

2025

​

2024

​

​

​

Average

​

​

​

​

Yield/

​

Average

​

​

​

​

Yield/

​

​

Balance

Interest

Cost

Balance

Interest

Cost

​

​

(Dollars in thousands)

Assets

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Interest-earning assets:

​

​

​

​

Mortgage loans, net

​

$

5,193,430

​

$

74,149

5.71

%

$

5,337,170

​

$

74,645

5.59

%

Other loans, net

​

1,401,607

​

20,821

5.94

​

1,400,091

​

21,135

6.04

​

Total loans, net (1) (2)

​

6,595,037

​

94,970

5.76

​

6,737,261

​

95,780

5.69

​

Taxable securities:

​

​

​

​

​

Mortgage-backed securities

​

832,514

​

11,513

5.53

​

984,383

​

12,443

5.06

​

Other securities

​

536,314

​

7,939

5.92

​

714,161

​

11,431

6.40

​

Total taxable securities

​

1,368,828

​

19,452

5.68

​

1,698,544

​

23,874

5.62

​

Tax-exempt securities: (3)

​

​

​

​

​

Other securities

​

43,168

​

458

4.24

​

65,070

​

474

2.91

​

Total tax-exempt securities

​

43,168

​

458

4.24

​

65,070

​

474

2.91

​

Interest-earning deposits and federal funds sold

​

174,549

​

1,685

3.86

​

208,796

​

2,565

4.91

​

Total interest-earning assets

​

8,181,582

​

116,565

5.70

​

8,709,671

​

122,693

5.63

​

Other assets

​

520,645

​

​

​

​

494,213

​

​

​

​

Total assets

​

$

8,702,227

​

​

​

​

​

​

$

9,203,884

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Interest-bearing liabilities:

​

​

​

​

​

​

​

Deposits:

​

​

​

​

​

​

​

Savings accounts

​

$

92,068

​

94

​

0.41

​

$

102,196

​

122

​

0.48

​

NOW accounts

​

2,154,978

​

18,808

​

3.49

​

1,886,387

​

18,795

​

3.99

​

Money market accounts

​

1,677,996

​

15,390

​

3.67

​

1,673,499

​

17,485

​

4.18

​

Certificates of deposit accounts

​

2,445,173

​

22,766

​

3.72

​

2,884,280

​

29,676

​

4.12

​

Total due to depositors

​

6,370,215

​

57,058

​

3.58

​

6,546,362

​

66,078

​

4.04

​

Mortgagors' escrow accounts

​

81,501

​

79

​

0.39

​

71,965

​

72

​

0.40

​

Total interest-bearing deposits

​

6,451,716

​

57,137

​

3.54

​

6,618,327

​

66,150

​

4.00

​

Borrowings

​

471,924

​

5,504

​

4.67

​

886,190

​

10,840

​

4.89

​

Total interest-bearing liabilities

​

6,923,640

​

62,641

​

3.62

​

7,504,517

​

76,990

​

4.10

​

Non interest-bearing demand deposits

​

893,831

​

​

​

​

​

845,456

​

​

​

​

​

Other liabilities

​

172,156

​

​

​

​

​

181,149

​

​

​

​

​

Total liabilities

​

7,989,627

​

​

​

​

​

8,531,122

​

​

​

​

​

Equity

​

712,600

​

​

​

​

​

672,762

​

​

​

​

​

Total liabilities and equity

​

$

8,702,227

​

​

​

​

​

​

$

9,203,884

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Net interest income / net interest rate spread

​

​

​

​

$

53,924

​

2.08

%

​

​

​

$

45,703

​

1.53

%

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Net interest-earning assets / net interest margin

​

$

1,257,942

​

​

​

2.64

%

$

1,205,154

​

​

​

2.10

%

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Ratio of interest-earning assets to interest-bearing liabilities

​

​

​

1.18

X

​

​

​

​

1.16

X

(1) Loan interest income includes loan fee income (expense) (which includes net amortization of deferred fees and costs, late charges, and prepayment penalties) of approximately $0.6 million and $0.4 million for the three months ended September 30, 2025 and 2024, respectively.

(2) Loan interest income includes net gains (losses) from fair value adjustments on hedges of $0.1 million and $0.4 million for three months ended September 30, 2025 and 2024, respectively.

(3) Interest and yields are calculated on the tax equivalent basis using the statutory federal income tax rate of 21% for the periods presented totaling $0.1 million each for the three months ended September 30, 2025 and 2024.

​

​

-58-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

For the nine months ended September 30,

​

​

2025

2024

​

​

Average

​

​

​

Yield/

Average

​

​

Yield/

​

​

Balance

Interest

Cost

Balance

Interest

Cost

​

Assets

(Dollars in thousands)

​

Interest-earning assets:

​

​

​

​

​

​

​

Loans held for sale

​

$

29,363

​

$

911

4.14

%

$

—

​

$

—

—

%

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Mortgage loans, net

​

​

5,238,185

​

​

220,780

5.62

​

​

5,343,108

​

​

218,185

5.44

​

Other loans, net

​

1,410,017

​

61,316

5.80

​

1,419,970

​

63,282

5.94

​

Total loans, net (1) (2)

​

6,648,202

​

​

282,096

​

5.66

​

6,763,078

​

​

281,467

​

5.55

​

Taxable securities:

​

​

​

​

​

​

​

Mortgage-backed securities

​

863,499

​

35,750

5.52

​

714,030

​

23,601

4.41

​

Other securities

​

564,908

​

24,635

5.81

​

656,325

​

30,343

6.16

​

Total taxable securities

​

1,428,407

​

​

60,385

​

5.64

​

1,370,355

​

​

53,944

​

5.25

​

Tax-exempt securities: (3)

​

​

​

​

​

​

​

Other securities

​

43,487

​

1,372

4.21

​

65,485

​

1,418

2.89

​

Total tax-exempt securities

​

43,487

​

​

1,372

​

4.21

​

65,485

​

​

1,418

​

2.89

​

Interest-earning deposits and federal funds sold

​

200,512

​

5,931

3.94

​

235,365

​

8,791

4.98

​

Total interest-earning assets (3)

​

8,349,971

​

​

350,695

​

5.60

​

8,434,283

​

​

345,620

​

5.46

​

Other assets

​

527,607

​

​

​

​

480,793

​

​

​

​

Total assets

​

$

8,877,578

​

​

​

​

$

8,915,076

​

​

​

​

Liabilities and Equity

​

​

​

​

​

​

​

Interest-bearing liabilities

​

​

​

​

​

​

​

Deposits:

​

​

​

​

​

​

​

Savings accounts

​

$

95,036

​

​

302

​

0.42

​

$

103,908

​

359

0.46

​

NOW accounts

​

2,252,851

​

​

58,834

​

3.48

​

1,946,022

​

57,293

3.93

​

Money market accounts

​

1,686,519

​

​

46,085

​

3.64

​

1,704,320

​

52,083

4.07

​

Certificate of deposit accounts

​

2,505,979

​

​

67,919

​

3.61

​

2,578,988

​

74,977

3.88

​

Total due to depositors

​

6,540,385

​

​

173,140

​

3.53

​

6,333,238

​

​

184,712

​

3.89

​

Mortgagors' escrow accounts

​

88,316

​

208

0.31

​

80,408

​

196

0.33

​

Total deposits

​

6,628,701

​

​

173,348

​

3.49

​

6,413,646

​

​

184,908

​

3.84

​

Borrowed funds

​

490,442

​

17,033

4.63

​

807,230

​

29,638

4.90

​

Total interest-bearing liabilities

​

7,119,143

​

​

190,381

​

3.57

​

7,220,876

​

​

214,546

​

3.96

​

Non-interest-bearing deposits

​

875,037

​

​

​

834,217

​

​

​

Other liabilities

​

165,457

​

​

​

190,138

​

​

​

Total liabilities

​

8,159,637

​

​

​

8,245,231

​

​

​

Equity

​

717,941

​

​

​

669,845

​

​

​

Total liabilities and equity

​

$

8,877,578

​

​

​

$

8,915,076

​

​

​

Net interest income / net interest rate spread (tax equivalent) (3)

​

​

$

160,314

2.03

%

​

$

131,074

1.50

%

Net interest-earning assets / net interest margin (tax equivalent) (3)

​

$

1,230,828

​

2.56

%

$

1,213,407

​

2.07

%

Ratio of interest-earning assets to interest-bearing liabilities

​

​

1.17

X

​

1.17

X

(1) Loan interest income includes loan fee income (expense) (which includes net amortization of deferred fees and costs, late charges, and prepayment penalties) of approximately $2.2 million and $0.6 million for the nine months ended September 30, 2025 and 2024, respectively.

(2) Loan interest income includes net gains (losses) from fair value adjustments and termination on hedges of $0.2 million and $0.4 million for the nine months ended September 30, 2025 and 2024, respectively.

(3) Interest and yields are calculated on the tax equivalent basis using the statutory federal income tax rate of 21% for the periods presented totaling  $0.3 million each for the nine months ended September 30, 2025 and 2024.

​

-59-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

LOANS HELD FOR INVESTMENT

The following table sets forth the Company’s loan originations (including the net effect of refinancing) and the changes in the Company’s portfolio of loans held for investment, including purchases, sales and principal reductions for the periods indicated.

​

​	​	​	​	​	​	​
​	​	For the nine months ended September 30,
(In thousands)		2025			2024
Mortgage Loans		​			​
At beginning of period	​	$	5,316,249	​	$	5,425,586
Mortgage loans originated:	​			​
Multi-family residential	​		47,403	​		90,299
Commercial real estate	​		120,648	​		87,326
One-to-four family mixed-use property	​		8,461	​		10,439
One-to-four family residential	​		701	​		2,619
Construction	​		10,583	​		11,552
Total mortgage loans originated	​		187,796	​		202,235
​	​	​	​	​	​	​
Mortgage loans purchased:	​			​
One-to-four family residential	​		121,505	​		52,314
Total mortgage loans purchased	​		121,505	​		52,314
​	​	​	​	​	​	​
Less:	​			​
Principal reductions	​		361,104	​		262,210
Loans transferred to (from) loans held for sale	​		(34,714)	​		—
Mortgage loan sales	​		22,960	​		18,148
Charge-Offs	​		3,473	​		14
Loans transferred to OREO	​	​	—	​	​	329
At end of period	​	$	5,272,727	​	$	5,399,434
​	​	​	​	​	​	​
Commercial business loans	​			​
At beginning of period	​	$	1,421,527	​	$	1,472,723
Loans originated:	​			​
Small Business Administration	​		4,235	​		5,930
Commercial business	​	​	176,833	​	​	130,032
Other	​		3,590	​		4,514
Total commercial business and other loans originated	​		184,658	​		140,476
​	​	​	​	​	​	​
Commercial business loans purchased:	​			​
Commercial business	​		92,053	​		78,018
Total commercial business loans purchased	​		92,053	​		78,018
​	​	​	​	​	​	​
Less:	​			​
Small Business Administration sales	​	​	7,973	​	​	—
Principal reductions	​		300,350	​		280,721
Charge-offs	​		5,878	​		3,163
At end of period	​	$	1,384,037	​	$	1,407,333

​

​

​

​

​

​

​

​

-60-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

NON-PERFORMING ASSETS

​

​

The following table shows the principal balance of our non-performing assets at the periods indicated:

​

​	​	​	​	​	​	​	​
​	​	At September 30,		​	At December 31,		​
(Dollars in thousands)		2025			2024
​	​	​	​	​	​	​	​
Non-accrual mortgage loans:	​			​			​
Multi-family residential	​	$	12,970	​	$	11,031	​
Commercial real estate	​		21,786	​		6,283	​
One-to-four family mixed-use property	​		—	​		116	​
One-to-four family residential	​		1,351	​		1,428	​
Total	​		36,107	​		18,858	​
Non-accrual commercial business loans:	​			​			​
Small Business Administration	​		554	​		2,445	​
Commercial business and other	​		8,190	​		12,015	​
Total	​		8,744	​		14,460	​
Total non-accrual loans	​		44,851	​		33,318	​
​	​	​	​	​	​	​	​
Total non-performing loans	​		44,851	​		33,318	​
Other non-performing assets:	​			​			​
Available for sale securities	​		17,278	​		18,000	​
Total	​		17,278	​		18,000	​
​	​	​	​	​	​	​	​
Total non-performing assets	​	$	62,129	​	$	51,318	​
​	​	​	​	​	​	​	​
Non-performing loans to gross loans	​		0.67	%		0.49	%
Non-performing assets to total assets	​		0.70	%		0.57	%

​

​

CRITICIZED AND CLASSIFIED ASSETS

Our policy is to review our assets, focusing primarily on the loan portfolio, other real estate owned, and the investment portfolio, to ensure that credit quality is maintained at the highest levels. See Note 5 (“Loans”) of the Notes to the Consolidated Financial Statements for a description of how loans are determined to be criticized or classified and a table displaying criticized and classified loans at September 30, 2025. The amortized cost of Criticized and Classified assets was $94.8 million at September 30, 2025, an increase of $0.2 million from $94.6 million at December 31, 2024.

Included within net loans at September 30, 2025 and December 31, 2024, were $1.3 million and $2.7 million, respectively, of consumer mortgage loans secured by residential real estate properties for which formal foreclosure proceedings were in process according to local requirements of the applicable jurisdiction.

​

​

​

​

-61-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

ALLOWANCE FOR CREDIT LOSSES

The following table shows allowance for credit losses at the period indicated:

​

​	​	​	​	​	​	​
​	​	For the nine months ended September 30,
(In thousands)	​	​	2025	​	​	2024
Balance at beginning of period	​	$	40,152	​	$	40,161
Loans- charge-off	​	​	(9,352)	​	​	(3,179)
Loans- recovery	​	​	1,286	​	​	231
Loans- provision (benefit)	​	​	9,751	​	​	3,129
Allowance for credit losses - loans	​	​	41,837	​	​	40,342
​	​	​	​	​	​	​
​	​	​	​	​	​	​
Balance at beginning of period	​	​	353	​	​	1,087
HTM securities (benefit) provision	​	​	(2)	​	​	(1)
Allowance for credit losses - HTM securities	​	​	351	​	​	1,086
​	​	​	​	​	​	​
Balance at beginning of period	​	​	2,627	​	​	—
AFS securities (benefit) provision	​	​	294	​	​	—
Allowance for credit losses - AFS securities	​	​	2,921	​	​	—
​	​	​	​	​	​	​
​	​	​	​	​	​	​
Balance at beginning of period	​	​	1,037	​	​	1,102
Off-balance sheet- (benefit) provision	​	​	—	​	​	(44)
Allowance for credit losses - off-balance sheet	​	​	1,037	​	​	1,058
​	​	​	​	​	​	​
Allowance for credit losses	​	$	46,146	​	$	42,486

​

-62-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

The following table sets forth the activity in the Company’s ACL - loans for the periods indicated:

​

​	​	​	​	​	​	​	​
​	​	For the nine months ended September 30,					​
(Dollars in thousands)		2025			2024		​
Balance at beginning of year	​	$	40,152	​	$	40,161	​
Provision (benefit) for credit losses	​		9,751	​		3,129	​
​	​	​	​	​	​	​	​
Loans charged-off:	​			​			​
Multi-family residential	​	​	(2,101)	​	​	—	​
Commercial real estate	​	​	(1,347)	​	​	—	​
One-to-four family - mixed-use property	​	​	(20)	​	​	—	​
One-to-four family - residential	​	​	(5)	​	​	(14)	​
Small Business Administration	​		(279)	​		(7)	​
Commercial business and other	​		(5,600)	​		(3,158)	​
Total loans charged-off	​		(9,352)	​		(3,179)	​
​	​	​	​	​	​	​	​
Recoveries:	​			​			​
Multi-family residential	​		—	​		1	​
One-to-four family - mixed-use property	​	​	—	​	​	2	​
One-to-four family - residential	​	​	53	​	​	61	​
Small Business Administration	​	​	52	​	​	104	​
Commercial business and other	​	​	1,181	​	​	63	​
Total recoveries	​		1,286	​		231	​
​	​	​	​	​	​	​	​
Net (charge-offs) recoveries	​		(8,066)	​		(2,948)	​
Balance at end of year	​	$	41,837	​	$	40,342	​
​	​	​	​	​	​	​	​
Ratio of net charge-offs to average loans outstanding during the period	​		0.16	%		0.06	%
Ratio of ACL - loans to gross loans at end of period	​		0.63	%		0.59	%
Ratio of ACL - loans to non-accrual loans at end of the period	​	​	93.28	%		117.75	%
Ratio of ACL - loans to non-performing loans at end of period	​		93.28	%		117.75	%

​

​

​

​

-63-

Table of Contents

PART I – FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

ITEM 3.       QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

For a discussion of the qualitative and quantitative disclosures about market risk, see the information under the caption "Management’s Discussion and Analysis of Financial Condition and Results of Operations - Interest Rate Risk."

​

ITEM 4.       CONTROLS AND PROCEDURES

The Company carried out, under the supervision and with the participation of the Company’s management, including its Chief Executive Officer and Chief Financial Officer, an evaluation of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934) as of the end of the period covered by this Quarterly Report. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that, as of September 30, 2025, the design and operation of these disclosure controls and procedures were effective. During the period covered by this Quarterly Report, there have been no changes in the Company’s internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

​

​

​

-64-

​

Table of Contents

​

ITEM 1.       LEGAL PROCEEDINGS

The Company is a defendant in various lawsuits. Management of the Company, after consultation with outside legal counsel, believes that the resolution of these various matters will not result in any material adverse effect on the Company’s consolidated financial condition, results of operations and cash flows.

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ITEM 1A.     RISK FACTORS

There have been no material changes from the risk factors disclosed in the Company’s annual report on Form 10-K for the year ended December 31, 2024.

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ITEM 2.       UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The following table sets forth information regarding the shares of common stock repurchased by the Company during the three months ended September 30, 2025:

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​	​	​	​	​	​	​	​	​	​
​				​	​				Maximum
​	​	​	​	​	​	​	Total Number of	​	Number of
​	​	Total	​	​	​	​	Shares Purchased	​	Shares That May
​	​	Number	​	​	​	​	as Part of Publicly	​	Yet Be Purchased
​	​	of Shares	​	Average Price		​	Announced Plans	​	Under the Plans
Period	​	Purchased	​	Paid per Share		​	or Programs	​	or Programs
July 1 to July 31, 2025	​	—	​	​	—	​	—	​	807,964
August 1 to August 31, 2025	​	—	​	​	—	​	—	​	807,964
September 1 to September 30, 2025	​	—	​	​	—	​	—	​	807,964
Total		—	​	$	—		—	​

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During the quarter ended September 30, 2025, the Company did not repurchase any shares of the Company’s common stock. On September 30, 2025, 807,964 shares remained to be repurchased under the currently authorized stock repurchase programs. Stock will be purchased under the current stock repurchase programs from time to time, in the open market or through private transactions, subject to market conditions. There is no expiration or maximum dollar amount under these authorizations.

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ITEM 3.       DEFAULTS UPON SENIOR SECURITIES

None.

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ITEM 4.        MINE SAFETY DISCLOSURES

Not applicable.

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ITEM 5.       OTHER INFORMATION

None.

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ITEM 6.       EXHIBITS

​	​	​
Exhibit No.		Description
​	​	​
3.1 P	​	Certificate of Incorporation of Flushing Financial Corporation (Incorporated by reference to Exhibits filed with the Registration Statement on Form S-1 filed September 1, 1995, Registration No. 33-96488)
3.2	​	Certificate of Amendment to Certificate of Incorporation of Flushing Financial Corporation (Incorporated by reference to Exhibit 4.2 filed with Form S-8 filed May 31, 2002)
3.3	​	Certificate of Amendment to Certificate of Incorporation of Flushing Financial Corporation (Incorporated by reference to Exhibit 3.3 filed with Form 10-K for the year ended December 31, 2011)
3.4	​	Amended and Restated By-Laws of Flushing Financial Corporation (Incorporated by reference to Exhibit 3.6 filed with Form 10-Q for the quarter ended June 30, 2014)
4.1	​	Indenture, dated November 22, 2021, between Flushing Financial Corporation and Wilmington Trust, National Association, as trustee (Incorporated by reference to Exhibit 4.1 filed with Form 8-K filed November 22, 2021)
4.2	​	First Supplemental Indenture, dated November 22, 2021, between Flushing Financial Corporation and Wilmington Trust, National Association, as trustee (Incorporated by reference to Exhibit 4.2 filed with Form 8-K filed November 22, 2021)
4.3	​	Second Supplemental Indenture, dated August 24, 2022, between Flushing Financial Corporation and Wilmington Trust, National Association, as trustee (Incorporated by reference to Exhibit 4.2 filed with Form 8-K filed August 24, 2022)
4.4	​	Flushing Financial Corporation has outstanding certain long-term debt. None of such debt exceeds ten percent of Flushing Financial Corporation's total assets; therefore, copies of constituent instruments defining the rights of the holders of such debt are not included as exhibits. Copies of instruments with respect to such long-term debt will be furnished to the Securities and Exchange Commission upon request.
31.1	​	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by the Chief Executive Officer (filed herewith)
31.2	​	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by the Chief Financial Officer (filed herewith)
32.1	​	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes Oxley Act of 2002 by the Chief Executive Officer (furnished herewith)
32.2	​	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes Oxley Act of 2002 by the Chief Financial Officer (furnished herewith)
101.INS	​	Inline XBRL Instance Document -the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH	​	Inline XBRL Taxonomy Extension Schema Document (filed herewith)
101.CAL	​	Inline XBRL Taxonomy Extension Calculation Linkbase Document (filed herewith)
101.DEF	​	Inline XBRL Taxonomy Extension Definition Linkbase Document (filed herewith)
101.LAB	​	Inline XBRL Taxonomy Extension Label Linkbase Document (filed herewith)
101.PRE	​	Inline XBRL Taxonomy Extension Presentation Linkbase Document (filed herewith)
104	​	Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

P     Indicates a filing submitted in paper.

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FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

EXHIBIT INDEX

​	​	​
Exhibit No.		Description
​	​	​
3.1 P	​	Certificate of Incorporation of Flushing Financial Corporation (Incorporated by reference to Exhibits filed with the Registration Statement on Form S-1 filed September 1, 1995, Registration No. 33-96488)
3.2	​	Certificate of Amendment to Certificate of Incorporation of Flushing Financial Corporation (Incorporated by reference to Exhibit 4.2 filed with Form S-8 filed May 31, 2002)
3.3	​	Certificate of Amendment to Certificate of Incorporation of Flushing Financial Corporation (Incorporated by reference to Exhibit 3.3 filed with Form 10-K for the year ended December 31, 2011)
3.4	​	Amended and Restated By-Laws of Flushing Financial Corporation (Incorporated by reference to Exhibit 3.6 filed with Form 10-Q for the quarter ended June 30, 2014)
4.1	​	Indenture, dated November 22, 2021, between Flushing Financial Corporation and Wilmington Trust, National Association, as trustee (Incorporated by reference to Exhibit 4.1 filed with Form 8-K filed November 22, 2021)
4.2	​	First Supplemental Indenture, dated November 22, 2021, between Flushing Financial Corporation and Wilmington Trust, National Association, as trustee (Incorporated by reference to Exhibit 4.2 filed with Form 8-K filed November 22, 2021)
4.3	​	Second Supplemental Indenture, dated August 24, 2022, between Flushing Financial Corporation and Wilmington Trust, National Association, as trustee (Incorporated by reference to Exhibit 4.2 filed with Form 8-K filed August 24, 2022)
4.4	​	Flushing Financial Corporation has outstanding certain long-term debt. None of such debt exceeds ten percent of Flushing Financial Corporation's total assets; therefore, copies of constituent instruments defining the rights of the holders of such debt are not included as exhibits. Copies of instruments with respect to such long-term debt will be furnished to the Securities and Exchange Commission upon request.
31.1	​	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by the Chief Executive Officer (filed herewith)
31.2	​	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by the Chief Financial Officer (filed herewith)
32.1	​	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes Oxley Act of 2002 by the Chief Executive Officer (furnished herewith)
32.2	​	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes Oxley Act of 2002 by the Chief Financial Officer (furnished herewith)
101.INS	​	Inline XBRL Instance Document -the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH	​	Inline XBRL Taxonomy Extension Schema Document (filed herewith)
101.CAL	​	Inline XBRL Taxonomy Extension Calculation Linkbase Document (filed herewith)
101.DEF	​	Inline XBRL Taxonomy Extension Definition Linkbase Document (filed herewith)
101.LAB	​	Inline XBRL Taxonomy Extension Label Linkbase Document (filed herewith)
101.PRE	​	Inline XBRL Taxonomy Extension Presentation Linkbase Document (filed herewith)
104	​	Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

​

P     Indicates a filing submitted in paper.

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FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

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​			Flushing Financial Corporation,
​		​	​
​		​	​
​		​	​
Dated:	November 5, 2025	​	By:	/s/John R. Buran
​		​	​	John R. Buran
​		​	​	President and Chief Executive Officer
​		​	​
​		​	​
​		​	​
Dated:	November 5, 2025	​	By:	/s/Susan K. Cullen
​		​	​	Susan K. Cullen
​		​	​	Senior Executive Vice President, Treasurer and
​		​	​	Chief Financial Officer

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FAQ

What were FFIC’s Q3 2025 earnings and EPS?

Q3 2025 net income was $10.447 million, with diluted EPS of $0.30.

How did Flushing Financial’s net interest income perform in Q3 2025?

Net interest income was $53.828 million, supported by lower interest expense of $62.641 million.

What were FFIC’s deposits and loans as of September 30, 2025?

Total deposits were $7.333 billion and net loans held for investment were $6.628 billion.

Did FFIC record any notable charges in 2025?

Yes. Year-to-date results include a $17.636 million goodwill impairment.

How did FFIC’s borrowings change in 2025?

Borrowed funds fell to $492.457 million from $916.054 million at year-end, including FHLB and other borrowings of $253.934 million.

What was FFIC’s total assets at quarter-end?

Total assets were $8.872 billion as of September 30, 2025.

How many FFIC shares were outstanding most recently?

There were 33,778,438 common shares outstanding as of October 31, 2025.