What changed in this filing

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Item 9A. Controls and Procedures

2022-03-01 compared with 2021-03-15 · 187 added, 70 removed, 94 unchanged (73% of the section changed)

13 unchanged sentences

The Company’s independent registered public accounting firm that audited the financial statements that are included in this annual report on Form 10-K, has issued an attestation report on the Company’s internal control over financial reporting.

The attestation report of Crowe LLP appears on the previous page.

The attestation report of Crowe LLP appears on page 104.

Changes in Internal Control Over Financial Reporting

1 unchanged sentence

Other Information

On February 24, 2022, the Company adopted Amendment One to the Dime Community Bancshares, Inc.

2021 Equity Incentive Plan (the “Amendment”).

The Amendment provides that upon an involuntary termination following a change in control, all performance awards will vest as to all shares subject to an outstanding performance award as of the date of such involuntary termination:

(i) based on actual performance measured as of the most recent completed fiscal quarter, and (ii) if actual performance cannot be determined, all performance awards will vest as to all shares subject to an outstanding performance award at the target performance level.

The foregoing description of the Amendment does not purport to be complete and it is qualified in its entirety by reference to Exhibit 10.9 to this Annual Report on Form 10-K, which is incorporated herein by reference.

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

Directors, Executive Officers and Corporate Governance

18 unchanged sentences

issuance under the plan

2006 Stock-Based Incentive Plan

2012 Stock-Based Incentive Plan

2012 Equity Incentive Plan

2019 Equity Incentive Plan

2021 Equity Incentive Plan

Employee Stock Purchase Plan

12 unchanged sentences

Notes to Consolidated Financial Statements

Report of Independent Registered Public Accounting Firm

Report of Independent Registered Public Accounting Firm (PCAOB ID 173 )

Financial Statement Schedules

1 unchanged sentence

See Exhibit Index on page 107.

Form 10-K Summary

Not applicable.

EXHIBIT INDEX

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Stockholders and the Board of Directors

of Dime Community Bancshares, Inc.

and Subsidiaries

Hauppauge, New York

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated statements of financial condition of Dime Community Bancshares, Inc.

and Subsidiaries (the "Company") as of December 31, 2021 and 2020, the related consolidated statements of income, comprehensive income, changes in stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2021, and the related notes (collectively referred to as the "financial statements").

We also have audited the Company’s internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control – Integrated Framework:

(2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”).

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2021 and 2020, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2021 in conformity with accounting principles generally accepted in the United States of America.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control – Integrated Framework:

(2013) issued by COSO.

Change in Accounting Principle

As discussed in Notes 1 and 5 to the financial statements, the Company has changed its method of accounting for credit losses effective January 1, 2021 due to the adoption of Accounting Standards Update (“ASU”) No.

2016-13, Financial Instruments – Credit Losses (Topic 326) .

The Company adopted the new credit loss standard using the modified retrospective method such that prior period amounts are not adjusted and continue to be reported in accordance with previously applicable generally accepted accounting principles.

The adoption of the new credit loss standard and its subsequent application is also communicated as a critical audit matter below.

Basis for Opinions

The Company’s management is responsible for these financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Report by Management on Internal Control Over Financial Reporting.

Our responsibility is to express an opinion on the Company’s financial statements and an opinion on the Company’s internal control over financial reporting based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the financial statements included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk.

Our audits also included performing such other procedures as we considered necessary in the circumstances.

We believe that our audits provide a reasonable basis for our opinions.

Definition and Limitations of Internal Control Over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and

dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Acquisition – Fair Value of Acquired Loans

As described in Note 2 to the financial statements, on February 1, 2021 Dime Community Bancshares, Inc.

(“Legacy Dime”) merged with and into Bridge Bancorp, Inc.

(“Bridge”) (the “Merger”).

The Merger was accounted for as a reverse acquisition, with Legacy Dime deemed to have acquired Bridge in the Merger.

Determination of the acquisition date fair values of the assets acquired and liabilities assumed required management to make significant estimates and assumptions.

Specifically, the fair value of a loan portfolio acquired in a business combination requires greater levels of management estimates and judgment than the remainder of purchased assets or assumed liabilities.

The fair value of the acquired loans was $4.53 billion and required management to make estimates about discount rates, expected future cash flows, market conditions and other future events that are subjective and subject to change.

We identified the determination of the acquisition date fair value of acquired loans as a critical audit matter as auditing this estimate is especially complex and requires subjective auditor judgment.

The principal considerations for our determination that this is a critical audit matter is the level of judgment involved in evaluating the reasonableness of management’s assumptions, the need for specialized skill to audit in the development and application of subjective assumptions used to estimate cash flows, and the size of the acquired loan portfolio.

The primary procedures we performed to address this critical audit matter included:

● Testing the effectiveness of controls over the evaluation of the assumptions used in the estimate of fair value of the acquired loans, including controls addressing:

o Management's review of the due diligence performed on the acquired loan portfolio, which impacts the probability of default and loss given default assumptions used in the cash flow calculations.

o Management’s review of the reasonableness of the significant valuation assumptions used in the estimate of the fair value of acquired loans.

o Management’s review of the results of the third-party valuation of the acquired loan portfolio, including the review of the completeness and accuracy of the data inputs used as a basis for the valuation.

● Substantively testing management’s process, including evaluating their judgments and the reasonableness of assumptions used in the fair value estimate of the acquired loan portfolio, which included:

o Evaluation of the completeness and accuracy of data inputs used as a basis for the valuation.

o Evaluation, with the assistance of professionals with specialized skill and knowledge, of the reasonableness of management’s significant valuation assumptions used in the estimate of the fair value of the acquired loans.

o Testing the mathematical accuracy of the estimated fair value, including the application of the assumptions used in the calculation.

Allowance for Credit Losses for Loans – Model Design and Qualitative Factors

As described in Notes 1 and 5 to the financial statements and referred to in the change in accounting principle explanatory paragraph above, on January 1, 2021 (“adoption date”), the Company adopted ASU No.

2016-13, Financial Instruments – Credit Losses (Topic 326) under a modified retrospective approach, which required the Company to estimate expected credit losses for its financial assets carried at amortized cost utilizing the current expected credit loss (“CECL”) methodology.

As of the adoption

date, the Company recorded a decrease in the allowance for credit losses (“ACL”) for loans of approximately $3.9 million as a cumulative effect adjustment from a change in accounting policy, with a corresponding increase in retained earnings, net of applicable income taxes.

At December 31, 2021, the ACL on the overall loan portfolio was $83.9 million and consisted of $41.4 million related to collectively evaluated loans, $22.3 million related to individually evaluated loans and $20.2 million related to purchased loans with credit deterioration (“PCD Loans”).

In determining the ACL related to non-PCD loans that are collectively evaluated, expected credit losses are determined by calculating a loss percentage by loan segment, or pool.

Management estimates the allowance for credit losses on each loan pool using relevant available information, from internal and external sources, relating to past events, current conditions, and reasonable and supportable forecasts.

Historically observed credit loss experience of peer banks within the Company’s geography provide the basis for the estimation of expected credit losses on similar loan pools.

Within the model, assumptions are made in the determination of probability of default, loss given default, reasonable and supportable economic forecasts, prepayment rate, curtailment rate, and recovery lag periods.

Statistical regression is utilized to relate historical macro-economic variables to historical credit loss experience of the peer group.

These models are then utilized to forecast future expected loan losses based on expected future behavior of the same macro-economic variables.

The quantitative results are adjusted using qualitative factors.

These factors include:

(1) lending policies and procedures;

(2) international, national, regional and local economic business conditions and developments that affect the collectability of the portfolio, including the condition of various markets;

(3) the nature and volume of the loan portfolio;

(4) the experience, ability, and depth of the lending management and other relevant staff;

(5) the volume and severity of past due loans;

(6) the quality of our loan review system;

(7) the value of underlying collateral for collateralized loans;

(8) the existence and effect of any concentrations of credit, and changes in the level of such concentrations;

and (9) the effect of external factors such as competition and legal and regulatory requirements on the level of estimated credit losses in the existing portfolio.

A significant amount of judgment is required to assess the reasonableness of the qualitative factors.

Further, changes to these factors as well as changes in the model design could have a material effect on the Company’s financial results.

The model design and the qualitative factors used contribute significantly to the determination of ACL related to loans that share similar risk characteristics.

We identified the assessment of the model design and construction and the assessment of qualitative factors as a critical audit matter because auditing management’s estimate required especially subjective auditor judgment and significant audit effort, including the need for specialized skill.

The primary procedures we performed to address these critical audit matters included:

● Testing the effectiveness of controls over the evaluation of the conceptual design and construction of the models and the evaluation of the qualitative factors, including controls addressing:

o Management’s review and approval of the models and methodologies used to establish the ACL.

o Management’s review of the results of the third-party model validation.

o Management’s review and approval of the qualitative factors, including significant assumptions and judgments made and the relevance and reliability of data used as the basis for those judgments.

● Substantively testing management’s process, including evaluating their judgments and significant assumptions used in the conceptual design and construction of the models and assessment of qualitative factors, which included:

o Evaluation, with the assistance of professionals with specialized skill and knowledge, of the reasonableness of management’s judgments related to the conceptual design and construction of the models.

o Evaluation of the reasonableness of management’s judgments related to qualitative factors to determine if they are calculated to conform with management’s policies and were consistently applied from the point of adoption to year end.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

We have served as the Company’s auditor since 2009.

New York, New York

February 28, 2022

Exhibit Number

Description of Exhibit

Restated Certificate of Incorporation of the Registrant (incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8-K, filed February 2, 2021)

Amended and Restated Bylaws of the Registrant (incorporated by reference to Exhibit 3.2 to the Registrant’s Form 8-K, filed February 1, 2021)

Exhibit Number

Description of Exhibit

Restated Certificate of Incorporation of the Registrant (incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8-K, filed February 2, 2021 (SEC File No.

Amended and Restated Bylaws of the Registrant (incorporated by reference to Exhibit 3.2 to the Registrant’s Form 8-K, filed February 1, 2021 (SEC File No.

Description of the Registrant’s Securities

Indenture, dated as of June 13, 2017, by and between Dime Community Bancshares, Inc., as Issuer, and Wilmington Trust, National Association, as Trustee (incorporated by reference to Exhibit 4.1 to Dime Community Bancshares, Inc.’s Form 8-K, filed on June 13, 2017)

First Supplemental Indenture, dated as of June 13, 2017, by and between Dime Community Bancshares, Inc., as Issuer, and Wilmington Trust, National Association, as Trustee, including the form of the 4.50% fixed-to-floating rate subordinated debentures due 2027 attached as Exhibit A thereto (incorporated by reference to Exhibit 4.2 to Dime Community Bancshares, Inc.’s Form 8-K, filed on June 13, 2017)

Second Supplemental Indenture, dated as of February 1, 2021, by and between the Registrant and Wilmington Trust, National Association, as Trustee (incorporated by reference to Exhibit 4.3 to the Registrant’s Form 8-K, filed February 1, 2021)

Amended and Restated Employment Contract – Howard H.

Nolan (incorporated by reference to Registrant’s Form 8-K, File No.

001-34096, filed June 24, 2015)

First Amendment to the Amended and Restated Employment Contract – Howard H.

Nolan (incorporated by reference to Registrant’s Form 10-Q, File No.

0-18546, filed May 10, 2016)

Second Amendment to the Amended and Restated Employment Contract – Howard H.

Nolan (incorporated by reference to Registrant’s Form 10-Q, File No.

0-18546, filed August 8, 2016)

Third Amendment to the Amended and Restated Employment Contract – Howard H.

Nolan (incorporated by reference to Registrant’s Form 10-K, File No.

001-34096, filed March 9, 2018)

Employment Agreement – Kevin M.

O’Connor (incorporated by reference to Registrant’s Form 8-K, File No.

0-18546, filed October 15, 2007)

Equity Incentive Plan (incorporated by reference to Registrant’s Definitive Proxy Statement, File No.

0-18546, filed March 24, 2006)

Supplemental Executive Retirement Plan (Revised for 409A) (incorporated by reference to Registrant’s Form 10-K, File No.

0-18546, filed March 14, 2008)

2012 Stock-Based Incentive Plan (incorporated by reference to the Registrant’s Definitive Proxy Statement, File No.

001-34096, filed April 2, 2012)

Bridge Bancorp, Inc.

Amended and Restated Directors Deferred Compensation Plan (incorporated by reference to Registrant’s Form 10-K, File No.

001-34096, filed March 11, 2018)

Form of Employment Agreement entered into with James J.

Manseau, John M.

McCaffery and Kevin L.

Santacroce (incorporated by reference to Registrant’s Form 10-K, File No.

001-34096, filed March 9, 2018)

Bridge Bancorp, Inc.

Employee Stock Purchase Plan (incorporated by reference to the Registrant’s Definitive Proxy Statement, File No.

Indenture, dated as of September 21, 2015, by and between the Registrant, as Issuer, and Wilmington Trust, National Association, as Trustee (incorporated by reference to Exhibit 4.1 to Registrant’s Form 8-K, filed on September 21, 2015 (SEC File No.

First Supplemental Indenture, dated as of September 21, 2015, by and between the Registrant and Wilmington Trust, National Association, as Trustee, including the form of the 5.25% fixed - to-floating rate subordinated debentures due 2025 attached as Exhibit A thereto (incorporated by reference to Exhibit 4.2 to the Registrant’s Form 8-K, filed September 21, 2015 (SEC File No.

Second Supplemental Indenture, dated as of September 21, 2015, by and between the Registrant and Wilmington Trust, National Association, as Trustee, including the form of the 5.75% fixed-to-floating rate subordinated debentures due 2030 attached as Exhibit A thereto (incorporated by reference to Exhibit 4.3 to the Registrant’s Form 8-K, filed September 21, 2015 (SEC File No.

Form of Employment Agreement entered into with Kevin M.

O’Connor, Stuart H.

Lubow, Avinash Reddy, John McCaffery and Conrad J.

Gunther (incorporated by reference to Exhibit 10.4 to Pre-Effective Amendment No.

1 to the Registrant’s Registration Statement on Form S-4, filed October 15, 2020 (File No.

Form of Amendment to Employment Agreement entered into with Kevin M.

O’Connor, Stuart H.

Lubow, Avinash Reddy and Conrad J.

Gunther (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed June 28, 2021 (File No.

Second Amendment to Employment Agreement entered into with Stuart H.

Lubow (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed December 23, 2021 (File No.

Amendment to Employment Agreement entered into with Kevin L.

Santacroce (incorporated by reference to Exhibit 10.8 to Pre-Effective Amendment No.

1 to the Registrant’s Registration Statement on Form S-4, filed October 15, 2020 (File No.

Form of Retention and Award Agreement entered into with Kevin M.

O’Connor, Stuart H.

Lubow, Avinash Reddy, John M.

McCaffery, Kevin L.

Santacroce, Conrad J.

Gunther and James J.

Manseau (incorporated by reference to Exhibit 10.5 to Pre-Effective Amendment No.

1 to the Registrant’s Registration Statement on Form S-4, filed October 15, 2020 (File No.

Form of Defense of Tax Position Agreement entered into with Kevin M.

O’Connor, Kenneth J.

Mahon, Stuart H.

Lubow, Avinash Reddy, John McCaffery and Conrad J.

Gunther (incorporated by reference to Exhibit 10.6 to Pre-Effective Amendment No.

1 to the Registrant’s Registration Statement on Form S-4, filed October 15, 2020 (File No.

Executive Chairman and Separation Agreement entered into with Kenneth J.

Mahon (incorporated by reference to Exhibit 10.7 to Pre-Effective Amendment No.

1 to the Registrant’s Registration Statement on Form S-4, filed October 15, 2020 (File No.

Dime Community Bank Supplemental Executive Retirement Plan (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed November 2, 2021 (File No.

Amendment One to the Dime Community Bancshares, Inc.

2021 Equity Incentive Plan

Dime Community Bancshares, Inc.

2021 Equity Incentive Plan (incorporated by reference to the Registrant’s Definitive Proxy Statement, File No.

001-34096, filed April 16, 2021)

Dime Community Bancshares, Inc.

2019 Equity Incentive Plan (incorporated by reference to the Registrant’s Definitive Proxy Statement, File No.

001-34096, filed April 1, 2019)

Form of Amendment to Employment Agreement and Amended and Restated Employment Agreement entered into with Howard H.

Nolan, James J.

Manseau, John M.

McCaffery and Kevin L.

Santacroce (incorporated by reference to Exhibit 10.10 to the Registrant’s Annual Report on Form 10-K, File No.

001-34096, filed March 11, 2020)

Exhibit Number

Description of Exhibit

2012 Stock-Based Incentive Plan (incorporated by reference to the Registrant’s Definitive Proxy Statement, File No.

001-34096, filed April 2, 2012)

Agreement and General Release by and between Dime Community Bancshares, Inc., Dime Community Bank and John M.

McCaffery (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed June 15, 2021 (File No.

Settlement and Release Agreement with Howard Nolan (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed February 1, 2021 (File No.

Non-Competition and Consulting Agreement with Howard Nolan (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K, filed February 1, 2021 (File No.

Bridge Bancorp, Inc.

Employee Stock Purchase Plan (incorporated by reference to the Registrant’s Definitive Proxy Statement, filed April 2, 2018 (SEC File No.

Subsidiaries of Registrant

3 unchanged sentences

Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Rule 13a-14(b) and 18 U.S.C.

The following financial statements from Dime Community Bancshares, Inc.’s Annual Report on Form 10-K for the Year Ended December 31, 2020, filed on March 15, 2021, formatted in Inline XBRL:

The following financial statements from Dime Community Bancshares, Inc.’s Annual Report on Form 10-K for the Year Ended December 31, 2021, filed on February 28, 2022, formatted in Inline XBRL:

(i) Consolidated Balance Sheets as of December 31, 2021 and 2020, (ii) Consolidated Statements of Income for the Years Ended December 31, 2021, 2020 and 2019, (iii) Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2021, 2020 and 2019, (iv) Consolidated Statements of Stockholders’ Equity for the Years Ended December 31, 2021, 2020 and 2019, (v) Consolidated Statements of Cash Flows for the Years Ended December 31, 2021, 2020 and 2019, and (vi) the Notes to Consolidated Financial Statements.

3 unchanged sentences

Inline XBRL Taxonomy Extension Labels Linkbase Document

Inline XBRL Taxonomy Extension Presentation Linkbase Document

XBRL Taxonomy Extension Presentation Linkbase Document

Inline XBRL Taxonomy Extension Definitions Linkbase Document

Cover page to this Annual Report on Form 10-K, formatted in Inline XBRL

Denotes incorporated by reference.

Form 10-K Summary

Not applicable.

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

DIME COMMUNITY BANCSHARES, INC.

March 15, 2021

February 28, 2022

Chief Executive Officer

March 15, 2021

February 28, 2022

/s/ Avinash Reddy

1 unchanged sentence

Senior Executive Vice President and Chief Financial Officer

March 15, 2021

February 28, 2022

/s/ Leslie Veluswamy

1 unchanged sentence

Senior Vice President, Chief Accounting Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

March 15, 2021

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated.

February 28, 2022

/s/ Kenneth J.

March 15, 2021

February 28, 2022

/s/ Marcia Z.

March 15, 2021

February 28, 2022

/s/ Rosemarie Chen

Rosemarie Chen

March 15, 2021

February 28, 2022

/s/ Michael P.

March 15, 2021

February 28, 2022

/s/ Matthew A.

March 15, 2021

February 28, 2022

/s/ Albert E.

March 15, 2021

February 28, 2022

/s/ Raymond A.

March 15, 2021

February 28, 2022

/s/ Vincent F.

March 15, 2021

February 28, 2022

/s/ Joseph J.

March 15, 2021

February 28, 2022

/s/ Kevin Stein

March 15, 2021

February 28, 2022

/s/ Dennis A.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures