Hanover Bancorp, Inc. reported a net income of $1.5 million, or $0.20 per diluted share, for the first quarter of 2025, a significant decrease from the $4.1 million, or $0.55 per diluted share, recorded in the same period of 2024. The decline in earnings was attributed to a $5.2 million increase in non-interest expenses, which included $3.2 million in costs related to a core system conversion, as well as higher salaries and employee benefits. Despite these challenges, the company experienced a $1.7 million increase in net interest income, driven by an improved net interest margin of 2.68%, up from 2.41% in the prior year.
Total assets for Hanover Bancorp stood at $2.3 billion as of March 31, 2025, a slight decrease from $2.31 billion at the end of 2024. The company’s total deposits also fell to $1.9 billion from $2.0 billion, reflecting a decrease of $17.8 million. The loan portfolio remained stable at approximately $2.0 billion, with a slight reduction in non-accrual loans to $11.7 million, or 0.60% of total loans, down from $16.4 million, or 0.82%, at the end of 2024. The allowance for credit losses increased to $22.9 million, representing 1.17% of total loans.
Strategically, Hanover Bancorp has been focusing on expanding its market presence and enhancing its service offerings. The company completed a core processing system conversion to FIS Horizon in February 2025, which is expected to improve operational efficiency. Additionally, the bank opened a new business banking center in Hauppauge, New York, in May 2023, and has received regulatory approval to establish a full-service branch in Port Jefferson, New York, anticipated to be operational by mid-2025. The bank has also begun offering business banking services to the legal cannabis industry, initially in New York and New Jersey.
Operationally, Hanover Bancorp reported a total of $48.8 million in closed residential loans for the quarter, with $27.6 million originated for the bank's portfolio and $21.2 million for sale in the secondary market. The company sold $18.3 million of residential loans under its flow origination program, generating gains of $0.4 million. However, the bank's SBA loan originations and gains on sale were lower than expected due to market conditions and administrative delays. Looking ahead, the bank anticipates growth in commercial and industrial lending and deposit activity as it navigates these challenges.
About Hanover Bancorp, Inc. /NY
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