KEARNY FINANCIAL CORP.

Red flags

• Non-owner-occupied commercial real estate equaled 515% of Bank total risk-based capital at June 30, 2026, above the 300% supervisory scrutiny threshold cited in the filing.
• Nonperforming loans rose to 0.82% of total loans from 0.78%, while nonperforming assets increased to 0.70% of assets from 0.59%.
• Multifamily loans were $2.50 billion, or 42.5% of loans; $36.9 million of multifamily loans were nonperforming, including $26.3 million of nonaccrual loans with an allowance.
• Wholesale funding was $1.9 billion, or 24.8% of total assets, creating refinancing and margin risk if funding costs rise or availability tightens.
• The $45.5 million allowance covered only 0.77% of loans and 94.99% of nonperforming loans; a hypothetical rise in the unemployment forecast to 9% would increase ACL coverage by 56 bps to 1.33%.
• The $0.44 annual dividend consumed 77.1% of FY2026 net income, leaving limited earnings retention relative to the bank’s credit and capital risks.