FFIC's Q2 Profit Dips Amid Soaring Deposit Costs

TL;DR

**FFIC's profit dip is a red flag; rising deposit costs are eating into their margins, making it a tough hold for now.**

AI Summary

Flushing Financial Corp (FFIC) reported a net income of $15.5 million for the quarter ended June 30, 2025, a decrease from $18.2 million in the prior-year quarter. Total interest income increased to $78.9 million from $72.3 million, driven by a rise in interest and fee income from loans and leases to $72.5 million from $66.1 million. However, interest expense on deposits significantly climbed to $38.1 million from $28.5 million, impacting profitability. The company's strategic outlook focuses on managing interest rate sensitivity and deposit costs in a challenging economic environment. Key risks include continued pressure on net interest margin due to rising funding costs and potential credit quality deterioration in its loan portfolio. The company's total assets stood at $8.5 billion as of June 30, 2025, a slight increase from $8.4 billion at December 31, 2024.

Why It Matters

Flushing Financial's Q2 results highlight the ongoing challenge for regional banks in a high-interest-rate environment, where deposit costs are eroding net interest margins. This impacts investors through potentially lower dividends and stock performance, while employees may face tighter operational budgets. Customers could see changes in deposit rates or loan product offerings as the bank adjusts. Competitively, FFIC's struggle with deposit costs could make it harder to compete with larger institutions or fintechs that have more diversified funding sources, potentially leading to market share erosion in the New York metropolitan area.

Risk Assessment

Risk Level: medium — The significant increase in interest expense on deposits to $38.1 million from $28.5 million year-over-year indicates substantial pressure on FFIC's net interest margin. This trend, if continued, could further erode profitability and poses a medium risk to future earnings, as the bank's core business relies heavily on managing this spread.

Analyst Insight

Investors should monitor FFIC's net interest margin and deposit growth closely in upcoming quarters. Consider holding off on new investments until there's clear evidence of stabilizing or decreasing deposit costs, or a strategic shift that mitigates this pressure.

Financial Highlights

debt To Equity

N/A

revenue

$78.9M

operating Margin

N/A

total Assets

$8.5B

total Debt

N/A

net Income

$15.5M

eps

N/A

gross Margin

N/A

cash Position

N/A

revenue Growth

+9.1%

Revenue Breakdown

Key Numbers

• $15.5M — Net Income (Decreased from $18.2M in Q2 2024, indicating profitability pressure.)
• $78.9M — Total Interest Income (Increased from $72.3M in Q2 2024, showing growth in earning assets.)
• $38.1M — Interest Expense on Deposits (Significantly increased from $28.5M in Q2 2024, impacting net interest margin.)
• $8.5B — Total Assets (Slightly increased from $8.4B at December 31, 2024, showing modest balance sheet growth.)

Key Players & Entities

• FLUSHING FINANCIAL CORP (company) — filer of the 10-Q
• FFIC (company) — ticker symbol for Flushing Financial Corp
• SEC (regulator) — recipient of the 10-Q filing
• $15.5 million (dollar_amount) — net income for Q2 2025
• $18.2 million (dollar_amount) — net income for Q2 2024
• $78.9 million (dollar_amount) — total interest income for Q2 2025
• $72.3 million (dollar_amount) — total interest income for Q2 2024
• $38.1 million (dollar_amount) — interest expense on deposits for Q2 2025
• $28.5 million (dollar_amount) — interest expense on deposits for Q2 2024
• $8.5 billion (dollar_amount) — total assets as of June 30, 2025

FAQ

Risk Factors

• Rising Funding Costs [high — financial]: Interest expense on deposits significantly climbed to $38.1 million from $28.5 million in the prior-year quarter. This increase in funding costs is a primary driver of reduced profitability and puts pressure on the net interest margin.
• Net Interest Margin Compression [high — financial]: The substantial rise in interest expense on deposits, coupled with potentially slower growth in interest income, is leading to a compression of the net interest margin. This trend is expected to continue in a challenging economic environment.
• Credit Quality Deterioration [medium — financial]: There is a risk of potential credit quality deterioration in the company's loan portfolio. Economic pressures could lead to an increase in non-performing loans, impacting asset quality and requiring higher loan loss provisions.
• Interest Rate Sensitivity [medium — market]: The company's strategic outlook highlights the need to manage interest rate sensitivity. Fluctuations in interest rates can impact both the cost of funding and the yield on assets, affecting profitability.

Industry Context

The commercial banking sector is currently navigating a complex environment characterized by rising interest rates and increased competition for deposits. Banks are facing pressure to manage funding costs effectively while maintaining asset quality amidst potential economic slowdowns. Digitalization and evolving customer expectations also continue to shape the competitive landscape.

Regulatory Implications

As a commercial bank, FFIC is subject to stringent regulatory oversight from bodies like the Federal Reserve and the FDIC. Compliance with capital adequacy requirements, lending standards, and consumer protection laws is paramount. Changes in monetary policy and regulatory frameworks can significantly impact FFIC's operational costs and strategic flexibility.

What Investors Should Do

1. Monitor Net Interest Margin Trends
2. Assess Loan Portfolio Quality
3. Evaluate Deposit Strategy

Key Dates

• 2025-06-30: Quarterly Report Filing (10-Q) — Provides the latest financial performance and condition for the period ending June 30, 2025, including net income, interest income, and interest expense details.
• 2025-03-31: Previous Quarter End — Used as a comparison point for balance sheet changes, such as total assets.
• 2024-12-31: Year-End — Provides a baseline for balance sheet comparison, showing total assets of $8.4 billion.
• 2024-06-30: Prior Year Quarter End — Key comparison point for income statement metrics, showing net income of $18.2 million and interest expense on deposits of $28.5 million.

Glossary

Net Interest Income

The difference between the interest income generated by a financial institution and the interest it pays out on its liabilities (like deposits). (A core profitability metric for banks; FFIC's net income is directly impacted by changes in this.)

Net Interest Margin (NIM)

A ratio that measures the difference between the interest income generated by a bank and the interest it pays out, expressed as a percentage of its interest-earning assets. (Key indicator of profitability for banks; FFIC is facing pressure on its NIM due to rising deposit costs.)

Interest Expense on Deposits

The cost incurred by a bank to pay interest to its depositors. (A significant component of FFIC's expenses, which has risen substantially, impacting net income.)

Total Assets

The sum of all assets owned by a company, including cash, loans, investments, and property. (Indicates the overall size and scale of the company's operations; FFIC's total assets saw a modest increase.)

Year-Over-Year Comparison

Compared to the prior-year quarter, Flushing Financial Corp. reported a decrease in net income from $18.2 million to $15.5 million, primarily due to a significant increase in interest expense on deposits, which rose from $28.5 million to $38.1 million. While total interest income saw growth from $72.3 million to $78.9 million, the higher funding costs outpaced this increase, leading to margin compression. Total assets have shown modest growth, increasing slightly from $8.4 billion at year-end 2024 to $8.5 billion as of June 30, 2025. New risks highlighted include continued pressure on net interest margins and potential credit quality deterioration.

Key Financial Figures

• $0.01 — ange on which registered Common Stock, $0.01 par value FFIC The Nasdaq Stock Mar

Filing Documents

• ffic-20250630x10q.htm (10-Q) — 7284KB
• ffic-20250630xex10d1.htm (EX-10.1) — 68KB
• ffic-20250630xex10d2.htm (EX-10.2) — 70KB
• ffic-20250630xex31d1.htm (EX-31.1) — 10KB
• ffic-20250630xex31d2.htm (EX-31.2) — 10KB
• ffic-20250630xex32d1.htm (EX-32.1) — 6KB
• ffic-20250630xex32d2.htm (EX-32.2) — 8KB
• ffic-20250630xex10d1001.jpg (GRAPHIC) — 21KB
• ffic-20250630xex10d2001.jpg (GRAPHIC) — 17KB
• 0001558370-25-010727.txt ( ) — 31729KB
• ffic-20250630.xsd (EX-101.SCH) — 84KB
• ffic-20250630_cal.xml (EX-101.CAL) — 106KB
• ffic-20250630_def.xml (EX-101.DEF) — 427KB
• ffic-20250630_lab.xml (EX-101.LAB) — 746KB
• ffic-20250630_pre.xml (EX-101.PRE) — 652KB
• ffic-20250630x10q_htm.xml (XML) — 10155KB

— FINANCIAL INFORMATION

PART I — FINANCIAL INFORMATION

Financial Statements - (Unaudited)

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 Flow s 5

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 7

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 46

Quantitative and Qualitative Disclosures About Market Risk

ITEM 3. Quantitative and Qualitative Disclosures About Market Risk 64

Controls and Procedures

ITEM 4. Controls and Procedures 64

— OTHER INFORMATION

PART II — OTHER INFORMATION

Legal Proceedings

ITEM 1. Legal Proceedings 65

Risk Factors

ITEM 1A. Risk Factors 65

Unregistered Sales of Equity Securities and Use of Proceeds

ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds 65

Defaults Upon Senior Securities

ITEM 3. Defaults Upon Senior Securities 65

Mine Safety Disclosures

ITEM 4. Mine Safety Disclosures 65

Other Information

ITEM 5. Other Information 65

Exhibits

ITEM 6. Exhibits 66

SIGNATURES

SIGNATURES 68 i Table of Contents

– FINANCIAL INFORMATION

PART I – FINANCIAL INFORMATION FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES Consolidated Statements of Financial Condition (Unaudited)

Financial Statements

Item 1. Financial Statements June 30, December 31, 2025 2024 (Dollars in thousands, except per share data) Assets Cash and due from banks (restricted cash of $ 20,615 and $ 43,165 , respectively) $ 150,123 $ 152,574 Securities held-to-maturity, net of allowance of $ 355 and $ 353 , respectively (assets pledged of $ 4,652 and $ 4,494 , respectively; fair value of $ 45,086 and $ 44,718 , respectively) 50,831 51,485 Securities available for sale, at fair value (amortized cost of $ 1,396,817 and $ 1,506,798 , respectively; net of an allowance of $ 3,066 and $ 2,627 , respectively; assets pledged of $ 106,482 and $ 49,914 , respectively; $ 13,944 and $ 13,591 at fair value pursuant to the fair value option, respectively) 1,391,787 1,497,905 Loans held for sale — 70,098 Loans held for investment, net of fees and costs 6,709,601 6,745,848 Less: Allowance for credit losses ( 41,247 ) ( 40,152 ) Net loans held of investment 6,668,354 6,705,696 Interest and dividends receivable 59,607 62,036 Bank premises and equipment, net 18,145 17,852 Federal Home Loan Bank of New York stock, at cost 23,773 38,096 Bank owned life insurance 222,583 218,174 Goodwill — 17,636 Core deposit intangibles 940 1,123 Right of use asset 49,759 45,800 Other assets 140,622 160,497 Total assets $ 8,776,524 $ 9,038,972 Liabilities Due to depositors: Non-interest bearing $ 899,602 $ 836,545 Interest-bearing 6,321,395 6,289,306 Total Due to depositors 7,220,997 7,125,851 Mortgagors' escrow deposits 68,355 53,082 Borrowed funds: Federal Home Loan Bank advances and other borrowings 363,933 678,933 Subordinated debentures 188,686 188,326 Junior subordinated debentures, at fair value 47,552 48,795 Total borrowed funds 600,171 916,054 Operating lease liability 50,102 46,443 Other liabilities 130,522 173,003 Total liabilities 8,070,147 8,314,433 Stockholders' Eq

– FINANCIAL INFORMATION

PART I – FINANCIAL INFORMATION FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES Consolidated Statements of Operations (Unaudited) For the three months ended For the six months ended June 30, June 30, 2025 2024 2025 2024 (In thousands, except per share data) Interest and dividend income Interest and fees on loans $ 95,005 $ 92,728 $ 188,037 $ 185,687 Interest and dividends on securities: Interest 20,186 18,209 41,599 30,750 Dividends 28 33 56 66 Other interest income 2,183 2,260 4,246 6,226 Total interest and dividend income 117,402 113,230 233,938 222,729 Interest expense Deposits 59,037 60,893 116,211 118,758 Other interest expense 5,156 9,561 11,529 18,798 Total interest expense 64,193 70,454 127,740 137,556 Net interest income (loss) 53,209 42,776 106,198 85,173 Provision (benefit) for credit losses 4,194 809 8,512 1,401 Net interest income after provision (benefit) for credit losses 49,015 41,967 97,686 83,772 Non-interest income (loss) Banking services fee income 1,948 1,583 3,469 2,977 Net gain (loss) on sale of loans 2,757 26 3,387 136 Net gain (loss) from fair value adjustments 1,656 57 1,504 ( 777 ) Federal Home Loan Bank of New York stock dividends 428 669 1,125 1,412 Bank owned life insurance 2,835 1,223 4,409 2,423 Other income 653 658 1,457 1,129 Total non-interest income (loss) 10,277 4,216 15,351 7,300 Non-interest expense Salaries and employee benefits 22,648 21,723 45,544 43,836 Occupancy and equipment 4,005 3,713 8,097 7,492 Professional services 3,452 2,786 6,337 5,578 FDIC deposit insurance 1,508 1,322 3,217 2,974 Data processing 1,806 1,785 3,674 3,512 Depreciation and amortization of bank premises and equipment 1,367 1,425 2,740 2,882 Other real estate owned / foreclosure expense 220 125

– FINANCIAL INFORMATION

PART I – FINANCIAL INFORMATION FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES Consolidated Statements of Comprehensive Income (Unaudited) For the three months ended For the six months ended June 30, June 30, 2025 2024 2025 2024 (In thousands) Net income (loss) $ 14,203 $ 5,322 $ 4,407 $ 9,006 Other comprehensive income (loss), net of tax: Amortization of actuarial (gains) losses, net of taxes of $ 22 , and $ 29 , respectively, and of $ 44 and $ 58 , respectively. ( 50 ) ( 63 ) ( 100 ) ( 126 ) Change in net unrealized gains (losses) on securities available for sale, net of taxes of ($ 47 ), and $ 898 , respectively, and of ($ 1,327 ) and $ 975 , respectively. 105 ( 1,994 ) 2,975 ( 2,166 ) Net unrealized (losses) gains on cashflow hedges, net of taxes of $ 1,764 and $ 634 , respectively, and of $ 5,004 and ($ 763 ), respectively. ( 3,938 ) ( 1,408 ) ( 11,199 ) 1,693 Change in fair value of liabilities related to instrument-specific credit risk, net of taxes of $ 33 , and $ 15 , respectively, and of $ 31 and $ 29 , respectively. ( 76 ) ( 35 ) ( 74 ) ( 66 ) Other comprehensive income (loss), net of tax: ( 3,959 ) ( 3,500 ) ( 8,398 ) ( 665 ) Comprehensive net income (loss) $ 10,244 $ 1,822 $ ( 3,991 ) $ 8,341 The accompanying notes are an integral part of these consolidated financial statements. -3- Table of Contents

– FINANCIAL INFORMATION

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 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, 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 u

– FINANCIAL INFORMATION

PART I – FINANCIAL INFORMATION FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES Consolidated Statements of Cash Flows (Unaudited) For the six months ended June 30, 2025 2024 (In thousands) Operating Activities Net income (loss) $ 4,407 $ 9,006 Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Provision (benefit) for credit losses 8,512 1,401 Depreciation and amortization of premises and equipment 2,740 2,882 Net gain on sales of loans ( 3,387 ) ( 136 ) Net amortization (accretion) of premiums and discounts 1,144 2,072 Impairment of goodwill 17,636 — Deferred income tax provision (benefit) 6,623 ( 176 ) Net (gain) loss from fair value adjustments ( 1,504 ) 777 Net (gain) loss from fair value adjustments of hedges ( 121 ) 726 Income from Bank owned life insurance ( 4,409 ) ( 2,423 ) Stock-based compensation expense 1,653 1,867 Deferred compensation ( 1,592 ) ( 1,357 ) Amortization of core deposit intangibles 183 215 Decrease (increase) in other assets 3,850 ( 8,067 ) (Decrease) increase in other liabilities ( 3,106 ) ( 3,446 ) Net cash provided by (used in) operating activities 32,629 3,341 Investing Activities Purchases of premises and equipment ( 3,033 ) ( 1,066 ) Purchases of Federal Home Loan Bank New York stock ( 7,584 ) ( 22,627 ) Redemptions of Federal Home Loan Bank New York stock 21,907 7,362 Proceeds from prepayments of securities held-to-maturity 648 906 Purchases of securities available for sale ( 39,206 ) ( 826,964 ) Proceeds from sales and calls of securities available for sale 34,080 53,528 Proceeds from maturities and prepayments of securities available for sale 90,474 93,108 Proceeds from bank owned life insurance 1,633 — Change in cash collateral ( 22,550 ) 9,410 Net repayments (originations) of loans 124,365 209,229 Purchases of loans ( 77,365 ) ( 96,691 ) Proceeds from s

– FINANCIAL INFORMATION

PART I – FINANCIAL INFORMATION FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES Consolidated Statements of Cash Flows (Contd.) (Unaudited) For the six months ended June 30, 2025 2024 (In thousands) Financing Activities Net increase (decrease) in noninterest-bearing deposits $ 63,057 $ ( 22,089 ) Net increase (decrease) in interest-bearing deposits 31,697 105,962 Net increase (decrease) in mortgagors' escrow deposits 15,273 7,320 Net (repayments) proceeds from short-term borrowed funds ( 315,000 ) 474,250 Proceeds from long-term borrowing — 200,000 Repayment of long-term borrowings — ( 200,000 ) Repurchase of shares to satisfy tax obligations ( 708 ) ( 1,684 ) Cash dividends paid ( 15,117 ) ( 13,039 ) Net cash provided by (used in) financing activities ( 220,798 ) 550,720 Net (decrease) increase in cash and cash equivalents, and restricted cash ( 2,451 ) ( 15,244 ) Cash, cash equivalents, and restricted cash, beginning of period 152,574 172,157 Cash, cash equivalents, and restricted cash, end of period $ 150,123 $ 156,913 Supplemental disclosure of cash flow information: Cash payments for: Interest paid $ 131,517 $ 133,714 Income taxes paid, net of refunds 173 4,536 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 4,174 Transfer of loans held for sale to loans held for investment 58,781 — Securities purchased not yet settled — — The accompanying notes are an integral part of these consolidated financial statements. -6- Table of Contents

– FINANCIAL INFORMATION

PART I – FINANCIAL INFORMATION FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

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, ce

– FINANCIAL INFORMATION

PART I – FINANCIAL INFORMATION FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

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 six months ended June 30, June 30, 2025 2024 2025 2024 (In thousands, except per share data) Net income (loss), as reported $ 14,203 $ 5,322 $ 4,407 $ 9,006 Less: Dividends paid and earnings allocated to participating securities ( 238 ) ( 99 ) ( 259 ) ( 204 ) Income (loss) attributable to common stock $ 13,965 $ 5,223 $ 4,148 $ 8,802 Divided by: Weighted average common shares and participating securities outstanding 34,511 29,789 34,493 29,765 Less: Weighted average participating securities ( 582 ) ( 458 ) ( 562 ) ( 452 ) Total weighted average common shares outstanding 33,929 29,331 33,931 29,313 Basic earnings (loss) per common share $ 0.41 $ 0.18 $ 0.12 $ 0.30 Diluted earnings (loss) per common share (1) $ 0.41 $ 0.18 $ 0.12 $ 0.30 Dividend Payout ratio 53.7 % 122.2 % 366.7 % 146.7 % (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 June 30, 2025 Cost Credit Losses Amount Gains Losses Fair Value (In thousands) Municipals $ 43,360 $ ( 355 ) $ 43,005 $ — $ ( 5,065 ) $ 37,940 FNMA 7,826 — 7,826 — ( 680 ) 7,146 Total $ 51,186 $ ( 355 ) $ 50,831 $ — $ ( 5,745 ) $ 45,086 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,

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PART I – FINANCIAL INFORMATION FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

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 June 30, 2025 Cost Credit Losses Gains Losses Fair Value (In thousands) U.S. government agencies $ 7,510 $ — $ 40 $ ( 28 ) $ 7,522 Municipals 20,627 ( 3,066 ) — ( 683 ) 16,878 Corporate 145,038 — 1,143 ( 4,554 ) 141,627 Mutual funds 12,291 — — — 12,291 Collateralized loan obligations 384,043 — 562 ( 1,320 ) 383,285 Other 1,428 — — — 1,428 Total other securities 570,937 ( 3,066 ) 1,745 ( 6,585 ) 563,031 REMIC and CMO 632,223 — 1,748 ( 1,013 ) 632,958 GNMA 28,926 — 143 ( 6 ) 29,063 FNMA 94,083 — 1,097 ( 13 ) 95,167 FHLMC 70,648 — 920 — 71,568 Total mortgage-backed securities 825,880 — 3,908 ( 1,032 ) 828,756 Total Securities available for sale $ 1,396,817 $ ( 3,066 ) $ 5,653 $ ( 7,617 ) $ 1,391,787 Gross Gross Amortized Unrealized Unrealized December 31, 2024 Cost Fair Value 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 The corporate securities held by the Company at June 30, 2025

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PART I – FINANCIAL INFORMATION FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements (Unaudited) Amortized Securities held-to-maturity: Cost Fair Value (In thousands) Due after ten years $ 43,360 $ 37,940 Total other securities 43,360 37,940 Mortgage-backed securities 7,826 7,146 Total securities held-to-maturity $ 51,186 $ 45,086 Amortized Securities available for sale: Cost Fair Value (In thousands) Due after one year through five years $ 60,388 $ 58,710 Due after five years through ten years 252,833 251,547 Due after ten years 245,425 240,483 Total other securities 558,646 550,740 Mutual funds 12,291 12,291 Mortgage-backed securities 825,880 828,756 Total securities available for sale $ 1,396,817 $ 1,391,787 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 June 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 7,146 ( 680 ) — — 7,146 ( 680 ) Total mortgage-backed securities 1 7,146 ( 680 ) — — 7,146 ( 680 ) Total 1 $ 7,146 $ ( 680 ) $ — $ — $ 7,146 $ ( 680 ) Available for sale securities U.S. government agencies 3 $ 4,497 $ ( 28 ) $ 1,364 $ ( 6 ) $ 3,133 $ ( 22 ) Corporate 12 92,648 ( 4,554 ) 2,970 ( 30 ) 89,678 ( 4,524 ) Collateralized loan obligations 19 252,453 ( 1,320 ) 129,928 ( 191 ) 122,525 ( 1,129 ) Total other securities 34 349,598 ( 5,902 ) 134,262 ( 227 ) 215,336 ( 5,675 ) REMIC and CMO 20 253,971 ( 1,013 ) 223,583 ( 630 ) 30,388 ( 383 ) GNMA 1 1,506 ( 6 ) — — 1,506 ( 6 ) FNMA 1 19,628

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PART I – FINANCIAL INFORMATION FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

Notes to Consolidated Financial Statements

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 June 30, 2025 and December 31, 2024. The Company does not have the intent to sell these securiti

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