The First of Long Island Corporation (FLIC): Boston Consulting Group Matrix [10-2024 Updated]

In 2024, The First of Long Island Corporation (FLIC) showcases a diverse portfolio that can be analyzed through the lens of the Boston Consulting Group Matrix. With strong growth in commercial mortgages and a healthy net interest margin, FLIC has positioned its multifamily loans as Stars. Meanwhile, consistent dividends and stable income streams categorize its noninterest income as Cash Cows. However, challenges persist in the residential mortgage sector, marking it as Dogs, while the uncertainty surrounding commercial and industrial loans places them in the Question Marks quadrant. Dive deeper to explore how these classifications reflect FLIC's strategic positioning and future potential.

Background of The First of Long Island Corporation (FLIC)

The First of Long Island Corporation (FLIC) is the holding company for The First National Bank of Long Island, established in 1927. Headquartered in Glen Head, New York, FLIC operates primarily in the banking sector, providing a variety of financial services including commercial and residential lending, investment advisory, and wealth management.

As of September 30, 2024, FLIC reported total assets of approximately $4.2 billion, with a strong capital position characterized by a leverage ratio of 10.13%. The bank's book value per share was $17.25, reflecting a slight increase from $16.83 at the end of 2023.

FLIC has a diverse loan portfolio, with commercial mortgages comprising 60% of total loans outstanding. The multifamily loans represent a significant portion of this, amounting to $862 million. The bank's focus on community banking allows it to cater to both individual and business clients, emphasizing personalized service and local market knowledge.

In terms of performance, FLIC reported net income of $13.8 million for the first nine months of 2024, down from $20.2 million in the same period of 2023. This decline was attributed to increased interest expenses and merger-related costs. The company has been actively managing its capital and has declared a quarterly cash dividend of $0.21 per share.

FLIC is also committed to maintaining high asset quality, with a stable allowance for credit losses of $28.6 million, or 0.88% of total loans. The bank's proactive approach to credit risk management is evident in its focus on multifamily properties, which account for a significant part of its commercial real estate portfolio.

Overall, FLIC's strategic initiatives and strong financial foundation position it well within the competitive landscape of community banking, allowing it to meet the evolving needs of its customers while navigating economic challenges.

The First of Long Island Corporation (FLIC) - BCG Matrix: Stars

Strong growth in commercial mortgages, particularly multifamily loans

As of September 30, 2024, The First of Long Island Corporation reported that commercial mortgages constituted approximately $2.0 billion, or 60% of total loans outstanding. Of this, multifamily loans made up 44%, totaling $862.0 million.

Increased interest income from loans, totaling $102.7 million in the last reported period

The interest income from loans for the nine months ended September 30, 2024, was reported at $102.7 million, compared to $94.7 million for the same period in 2023.

Healthy net interest margin reported at 1.83%

The net interest margin for the first nine months of 2024 stood at 1.83%, down from 2.21% for the same period in the previous year.

Robust capital position with a leverage ratio of approximately 10.13%

The leverage ratio of The First of Long Island Corporation was reported at 10.13% as of September 30, 2024, which exceeds the regulatory requirement of 9.00% for well-capitalized institutions.

Book value per share increased to $17.25, indicating shareholder value growth

At September 30, 2024, the book value per share increased to $17.25, compared to $16.83 at the end of 2023, reflecting growth in shareholder value.

The First of Long Island Corporation (FLIC) - BCG Matrix: Cash Cows

Consistent cash dividends declared at $0.21 per share

The First of Long Island Corporation has consistently declared cash dividends at $0.21 per share, providing reliable income for shareholders. This dividend yield translates to 6.5% based on a market value per share of $12.87 as of September 30, 2024.

Stable noninterest income sources

Noninterest income sources for FLIC include $2.5 million generated from service charges on deposit accounts. The overall noninterest income, excluding losses on securities sales, increased by $1.4 million compared to the previous year.

Steady loan performance

FLIC's loan performance remains robust, with a significant portion of loans rated as 'Pass' in risk assessments. As of September 30, 2024, the allowance for credit losses (ACL) was $28.6 million, which is 0.88% of total loans. Past due loans amounted to $346,000, while nonaccrual loans were reported at $2.9 million.

Ongoing profitability

For the nine months ended September 30, 2024, FLIC reported net income of $13.8 million, which includes after-tax merger and branch consolidation expenses of $981,000. This reflects a decrease from $20.2 million in net income for the same period in 2023.

The First of Long Island Corporation (FLIC) - BCG Matrix: Dogs

Residential Mortgages Showing Decline

The First of Long Island Corporation (FLIC) has experienced a significant decline in its residential mortgage segment. As of September 30, 2024, closed-end residential loans decreased to $7.3 million due to charge-offs, reflecting a troubling trend in this low-growth market.

Nonaccrual Loans

Nonaccrual loans have surged to $2.9 million, indicating mounting challenges in loan recovery efforts. This rise suggests difficulties in collecting payments from certain borrowers and highlights the potential for further financial distress within this segment.

High Provision for Credit Losses

The provision for credit losses stands at $740,000, underscoring the ongoing challenges in loan performance. This high level of provision reflects the bank's cautious outlook regarding the credit quality of its loan portfolio, particularly in segments classified as Dogs.

Minimal Growth in Consumer Loans

Consumer loans have shown minimal growth, suggesting limited market opportunity in this segment. The overall stagnation in this area further emphasizes the challenges faced by FLIC in generating profitable returns from its loan portfolio.

The First of Long Island Corporation (FLIC) - BCG Matrix: Question Marks

Growth potential in commercial and industrial loans remains uncertain, with mixed performance.

The First of Long Island Corporation (FLIC) has reported a decline in net interest income for the first nine months of 2024, amounting to $56.0 million, which reflects a decrease of $12.0 million, or 17.7%, compared to the same period in 2023. This decline is attributed to an increase in interest expense amounting to $23.4 million, which was partially offset by an increase in interest income of $11.7 million. The net interest margin for the first nine months of 2024 stood at 1.83%, down from 2.21% in 2023.

Emerging pressures from economic conditions affecting loan demand and credit quality.

As of September 30, 2024, the allowance for credit losses (ACL) decreased to $28.6 million, representing 0.88% of total loans, compared to $29.0 million, or 0.89% of total loans, at December 31, 2023. The corporation recorded a provision for credit losses of $740,000 for the first nine months of 2024, in contrast to a provision reversal of $1.2 million in the same period last year. Economic conditions, particularly inflation and rising interest rates, pose significant challenges that could adversely affect the financial strength of borrowers and the value of real estate collateral securing the corporation's mortgage loans.

The need for strategic initiatives to enhance market position and capitalize on growth opportunities.

To address the mixed performance in commercial and industrial loans, FLIC must consider strategic initiatives aimed at increasing market share. The corporation's total loans as of September 30, 2024, amounted to approximately $3.24 billion. The bank's commercial and industrial loans, which accounted for a significant portion of this total, were under pressure due to the economic environment, necessitating a focused strategy to stimulate growth.

Potential for increased competition in the banking sector, impacting future profitability.

FLIC's competitive landscape is evolving, with increased competition in the banking sector that could impact future profitability. As of September 30, 2024, total deposits grew by $56.1 million, or 1.7%, reaching $3.3 billion. However, the corporation faces challenges in maintaining its market share in a rapidly changing environment. The bank's noninterest income, which includes service charges on deposit accounts and other business activities, increased by $1.4 million, indicating a need to bolster this revenue stream to compensate for declining net interest income.

In summary, The First of Long Island Corporation (FLIC) presents a diverse portfolio as illustrated by the BCG Matrix. With strong growth in commercial mortgages and a robust capital position, FLIC's Stars are well-positioned for continued success. Meanwhile, the Cash Cows provide a steady stream of income through consistent dividends and stable loan performance. However, challenges exist within the Dogs, notably in the residential mortgage sector, and the Question Marks highlight uncertainties in commercial and industrial loans amidst competitive pressures. Addressing these areas will be crucial for FLIC to enhance its market position and sustain profitability.

Article updated on 8 Nov 2024

Resources:

1. The First of Long Island Corporation (FLIC) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of The First of Long Island Corporation (FLIC)' financial performance, including balance sheets, income statements, and cash flow statements.
2. SEC Filings – View The First of Long Island Corporation (FLIC)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.