11:04 AM EST, 12/05/2024 (MT Newswires) -- Columbia Financial ( CLBK ) said Thursday it repositioned its balance sheet in an effort to boost future earnings and grow its net interest margin.

The bank holding firm said it divested $321 million in available-for-sale debt securities with a 1.53% weighted average book yield, and an average life of 3.6 years, mainly purchased during the COVID period. The company used the proceeds for $85 million in loan growth, $66 million in higher-yielding debt securities, and $170 million to prepay high-cost borrowings.

The transaction resulted in about $38 million pre-tax loss but is expected to boost net interest income immediately and have no impact on tangible book value per share, the company said, adding that it expects a 24% increase in 2025 earnings and a 15 basis point rise in net interest margin compared to current analyst projections, with an estimated payback period of 3.1 years.

Columbia Financial ( CLBK ) said that after the transaction, it will maintain "well capitalized" regulatory capital ratios, with an estimated total capital to risk-weighted assets ratio at 13.87% and a tier 1 leverage capital ratio of 9.99%.

Shares of Columbia Financial ( CLBK ) were down 0.3% in recent trading.

Price: 17.75, Change: -0.05, Percent Change: -0.28