10-Q · May 7, 2026
Kearny Financial Corp. reported a decrease in both revenue and EPS compared to the previous quarter, with revenue at $39.236 million and diluted EPS of $0.15. Despite a revenue miss against estimates of $43.67 million,…
Earnings analysis · 10-K
KRNY earnings analysis
Filed August 21, 2026 · Our reading of the company's report
The latest report
Kearny delivered a materially improved fiscal 2026, with net income rising to $36.3 million, diluted EPS increasing to $0.57, and net interest margin expanding to 2.18%. The strategy is shifting loan production toward…
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Kearny delivered a materially improved fiscal 2026, with net income rising to $36.3 million, diluted EPS increasing to $0.57, and net interest margin expanding to 2.18%. The strategy is shifting loan production toward commercial and industrial and construction lending while improving deposit mix, but this raises credit sensitivity as CRE exposure remains 515% of Bank risk-based capital and a significant portion of loans reprices or matures in fiscal 2027. Capital and liquidity are solid, although no fiscal 2027 quantitative guidance was provided.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $0.57
- Segment
- One reportable operating segment: banking operations conducted principally through Kearny Bank; the company evaluates performance on a consolidated basis.
What stood out
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Earnings recovery continued
Net income increased to $36.3 million, or $0.57 diluted EPS, from $26.1 million, or $0.42, in fiscal 2025. The improvement followed the $86.7 million net loss in fiscal 2024, which included a $97.4 million goodwill impairment charge.
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NIM expansion drove core earnings
Net interest income rose to $155.3 million from $134.9 million, while net interest margin expanded 30 basis points to 2.18% from 1.88%. The improvement was driven primarily by a $20.5 million reduction in interest expense, partially offset by a $163,000 decline in interest income.
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Loan mix is shifting toward C&I
Management is remixing the loan portfolio toward commercial banking relationships: commercial and industrial loans increased $85.2 million to $223.9 million and construction loans increased $85.5 million to $263.2 million, while multi-family mortgages declined $209.8 million to $2.50 billion.
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Loans and core deposits grew
Net loans receivable increased 1.1% to $5.83 billion, and deposits increased 0.6% to $5.71 billion. The company also migrated $239.9 million from an interest-bearing consumer product to non-interest-bearing deposits as part of its repricing strategy.
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Liquidity and capital provide flexibility
Liquidity and capital remain strong: the company had $114.8 million of cash and equivalents, $964.4 million of available-for-sale securities, and $351.6 million of additional FHLB borrowing capacity plus $1.30 billion of FRB capacity without additional collateral. The Bank's total capital ratio was 14.38%, versus the 10.00% well-capitalized threshold.
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Dividends prioritized over buybacks
Capital was returned through $28.0 million of cash dividends, or $0.44 per share, during fiscal 2026, while no common shares were repurchased. Capital deployment priorities include organic balance-sheet growth, diversification, regular dividends, and selectively evaluating acquisitions expected to enhance long-term shareholder value.
What to watch
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Fiscal 2027 refinancing pressure
A significant portion of the loan book is scheduled to reset, mature, or refinance during fiscal 2027; many loans were originated in 2021 and 2022 below current market rates. Higher borrower debt-service costs could increase delinquencies and defaults, while nonperforming assets already increased $7.8 million to $53.4 million, or 0.70% of assets, from 0.59%.
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CRE concentration remains elevated
Commercial real estate concentration remains substantial: non-owner-occupied CRE, including multi-family and construction loans, equaled 515% of Bank total risk-based capital at June 30, 2026, above the 300% supervisory-scrutiny benchmark. The portfolio is concentrated in New Jersey and New York, increasing sensitivity to local property values, occupancy, rents, and regulation.
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AI and digital alternatives add risk
The company has begun and expects to continue integrating AI, generative AI, machine learning, RPA, and other emerging technologies, creating risks of inaccurate or biased outputs, model failures, privacy breaches, compliance issues, and third-party disruptions. The filing also notes that customers shifting deposits to stablecoins or other digital-asset payment technologies could cause deposit outflows and higher funding costs.
Management's outlook
No fiscal 2027 revenue or EPS guidance was provided in the 10-K; annual outlook was deferred to the earnings press release/call.
Earlier filings 4
10-Q · February 5, 2026
Kearny reported improved core profitability in Q2 ended December 31, 2025: total operating revenue (net interest income plus non‑interest income) of $43,540,000 and net income of $9,449,000 (diluted EPS $0.15) versus…
10-Q · May 7, 2025
Kearny Financial reported stable core net interest income of $34,042,000 and total revenue (net interest income plus non‑interest income) of $38,604,000 for the quarter ended March 31, 2025, while GAAP diluted EPS was…
10-Q · February 8, 2024
Kearny reported a quarterly net loss of $13,827,000 (EPS diluted $(0.22)) for the three months ended December 31, 2023, vs. net income $1,951,000 (EPS $0.03) in the prior-year quarter. Net interest income declined to…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.