Sterling Bancorp, Inc.

The call did not provide revenue, EPS, or gross margin figures. Management said the company is operating “essentially at a breakeven level,” with capital and liquidity remaining strong. On expenses, Karen Knott said legal fees were about $1.3 million in the quarter, other professional fees were around $800,000, and there was a couple hundred thousand related to investigation matters; she added non-interest expense had little other noise. For the next couple of quarters, she said that category should be around $1.8 million, and Tom O’Brien said the company is gradually moving toward a roughly $14 million quarterly expense run rate. No formal revenue or earnings guidance was given, but management said lower rates could help margin, commercial real estate lending may continue selectively, and residential lending will remain off the table.

Tom O’Brien framed the quarter as a continuation of recent periods: near breakeven, with strong capital and liquidity, and with the final wholesale funding exposure now gone. He emphasized that the DOJ investigation is closed, calling the years of legal and compliance burden painful but saying the outcome removes uncertainty and cost. Strategically, he said the bank remains cautious, focused on protecting book value and the balance sheet, while evaluating alternatives to position the franchise for future growth.

Karen Knott focused on expense details and the path toward a lower run rate. She said legal fees were about $1.3 million, other professional fees were around $800,000, and investigation-related noise was only a couple hundred thousand in the quarter; she also noted the annual merit process hits in Q3 but nothing else significant is expected. Her tone suggested costs should keep normalizing over the next few quarters, with non-interest expense generally quiet and trending toward the company’s roughly $14 million quarterly level.

Analyst Ross Haberman pressed on how much of the $2.1 million of professional fees was tied to legal and compliance costs, and management replied that about $1.3 million was legal fees while only a couple hundred thousand related to investigation matters. He also asked whether lower rates would improve prepayments or margin; Tom O’Brien said lower rates would help margin as liabilities reprice, but he did not expect a big change in residential prepayments because most loans are already in adjustable periods. On expenses and credit quality, management said there was little unusual spending left and that asset quality remains very strong, with virtually no commercial delinquencies and only four residential foreclosures.