2024 Annual Report

Navigating

Today's

Banking

Challenges

Together

REPORT 2024

Letter to Shareholders

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

• ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
  For the Fiscal Year Ended June 30, 2024

Or

• TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______ to

Commission File Number: 001-37399

___________________________________________________

KEARNY FINANCIAL CORP.

(Exact name of Registrant as specified in its Charter)

___________________________________________________

Registrant's telephone number, including area code: (973) 244-4500

Securities registered pursuant to Section 12(b) of the Act:

Securities registered pursuant to Section 12(g) of the Act: None

___________________________________________________

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. x Yes o No Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. o Yes x No

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. x Yes o No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). x Yes o No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer", "accelerated filer", "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. x

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. o

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b).o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). o Yes x No

The aggregate market value of the voting and non-voting common equity held by non-affiliates of the Registrant on December 29, 2023 (the last business day of the Registrant's most recently completed second fiscal quarter) was $528.6 million. Solely for purposes of this calculation, shares held by directors, executive officers and greater than 10% stockholders are treated as shares held by affiliates.

As of August 19, 2024 there were outstanding 64,579,683 shares of the Registrant's Common Stock.

DOCUMENTS INCORPORATED BY REFERENCE

1. Portions of the definitive Proxy Statement for the Registrant's 2024 Annual Meeting of Stockholders. (Part III)

i

PART I

Item 1. Business

Forward-Looking Statements

This Annual Report on Form 10-K contains forward-looking statements, which can be identified by the use of words such as "estimate," "project," "believe," "intend," "anticipate," "plan," "seek," "expect" and words of similar meaning. These forward-looking statements include, but are not limited to:

• statements of our goals, intentions and expectations;
• statements regarding our business plans, prospects, growth and operating strategies;
• statements regarding the quality of our loan and investment portfolios; and
• estimates of our risks and future costs and benefits.

These forward-looking statements are based on current beliefs and expectations of our management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. We are under no duty to and do not take any obligation to update any forward-looking statements after the date of the Annual Report on Form 10-K.

The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statements:

• general economic conditions, either nationally or in our market areas, that are worse than expected;
• changes in the level and direction of loan delinquencies and write-offs and changes in estimates of the adequacy of the allowance for credit losses;
• our ability to access cost-effective funding;
• fluctuations in real estate values and both residential and commercial real estate market conditions;
• demand for loans and deposits in our market area;
• our ability to implement changes in our business strategies;
• competition among depository and other financial institutions;
• inflation and/or changes in the interest rate environment that reduce our margins and yields, or reduce the fair value of financial instruments or reduce the origination levels in our lending business, or increase the level of defaults, losses and prepayments on loans we have made and make whether held in portfolio or sold in the secondary markets;
• adverse changes in the securities markets;
• changes in laws or government regulations or policies affecting financial institutions, including changes in regulatory fees and capital requirements;
• changes in monetary or fiscal policies of the U.S. Government, including policies of the U.S. Treasury and the Federal Reserve Board;
• our ability to manage market risk, credit risk and operational risk in the current economic conditions;
• significant increases in our loan losses;
• our ability to enter new markets successfully and capitalize on growth opportunities;
• our ability to successfully integrate any assets, liabilities, clients, systems and management personnel we have acquired or may acquire into our operations and our ability to realize related revenue synergies and cost savings within expected time frames and any goodwill charges related thereto;
• changes in consumer demand, borrowing and savings habits;
• changes in accounting policies and practices, as may be adopted by bank regulatory agencies, the Financial Accounting Standards Board, the Securities and Exchange Commission or the Public Company Accounting Oversight Board;
• our ability to retain key employees;
• technological changes;

2

• cyber-attacks,computer viruses and other technological risks that may breach the security of our websites or other systems to obtain unauthorized access to confidential information and destroy data or disable our systems;
• technological changes that may be more difficult or expensive than expected;
• the ability of third-party providers to perform their obligations to us;
• the ability of the U.S. Government to manage federal debt limits;
• changes in the financial condition, results of operations or future prospects of issuers of securities that we own; and
• other economic, competitive, governmental, regulatory and operational factors affecting our operations, pricing products and services described elsewhere in this Annual Report on Form 10-K.

Because of these and other uncertainties, our actual future results may be materially different from the results indicated by these forward-looking statements.

General

Kearny Financial Corp. (the "Company," or "Kearny Financial"), is a Maryland corporation that is the holding company for Kearny Bank (the "Bank" or "Kearny Bank"), a nonmember New Jersey-chartered savings bank.

The Company is a unitary savings and loan holding company, regulated by the Board of Governors of the Federal Reserve Bank ("FRB") and conducts no significant business or operations of its own. The Bank's deposits are federally insured by the Deposit Insurance Fund as administered by the Federal Deposit Insurance Corporation ("FDIC") and the Bank is primarily regulated by the New Jersey Department of Banking and Insurance ("NJDBI") and, as a nonmember bank, the FDIC. References in this Annual Report on Form 10-K to the Company or Kearny Financial generally refer to the Company and the Bank, unless the context indicates otherwise. References to "we," "us," or "our" refer to the Bank or Company, or both, as the context indicates.

The Company's primary business is the ownership and operation of the Bank. The Bank is principally engaged in the business of attracting deposits from the general public and using these deposits, together with other funds, to originate or purchase loans for its portfolio and for sale into the secondary market. Our loan portfolio is primarily comprised of loans collateralized by commercial and residential real estate augmented by secured and unsecured loans to businesses and consumers. We also maintain a portfolio of investment securities, primarily comprised of U.S. agency mortgage-backed securities, obligations of state and political subdivisions, corporate bonds, asset-backed securities and collateralized loan obligations.

We operate from our administrative headquarters in Fairfield, New Jersey and other administrative locations throughout the State of New Jersey. As of June 30, 2024, we had 43 branch offices. The Company maintains a website at www.kearnybank.com. We make available through that website, free of charge, copies of our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, amendments to those reports and proxy materials as soon as is reasonably practicable after the Company electronically files those materials with, or furnishes them to, the Securities and Exchange Commission. You may access these materials by following the links under "Investor Relations" under the "Financial Information" tab at the Company's website. Information on the Company's website is not and should not be considered a part of this Annual Report on Form 10-K.

Business Strategy

We have evolved our business model from that of a traditional thrift into that of a full-service community bank. This evolution has been accomplished by growing our commercial loans and deposits, expanding our product and service offerings, de- novo branching and the acquisition of other financial institutions. During this time, our strategy has been largely focused on profitably deploying capital and enhancing earnings through a variety of balance sheet growth and diversification strategies. The key components of our business strategy are as follows:

• Maintain Robust Capital and Liquidity Levels
  As demonstrated by the June 30, 2024 Common Equity Tier 1 Capital ratios of the Company and the Bank of 14.79% and 13.65%, respectively, we currently maintain, and plan to continue to maintain, capital levels in excess of regulatory minimums and internal capital adequacy guidelines.
  In addition to our robust capital levels, we maintain significant sources of both on- and off-balance sheet liquidity and plan to continue to do so. At June 30, 2024, our liquid assets included $63.9 million of short-term cash and equivalents

3

supplemented by $1.07 billion of investment securities classified as available for sale, which can be readily sold or pledged as collateral, if necessary. In addition, we had the capacity to borrow additional funds totaling $789.0 million via unsecured overnight borrowings from other financial institutions and $1.06 billion and $381.8 million from the Federal Home Loan Bank of New York and FRB, respectively, without pledging additional collateral.

• Continue Our Technology Transformation
  Given the ongoing evolution of our business towards digital channels, we have invested significant human resources and capital towards enhancing both our internal and client-facing technology systems. Our ongoing technology transformation has, and will continue to, impact nearly every area of the Company including the residential and commercial lending functions, retail deposit gathering, risk management and back office operations. In fiscal 2025, we will continue our digital strategy, spearheaded by our recently adopted cloud-based,best-in-breed digital banking and online account opening platform, and continue to serve our clients' needs in an omnichannel environment while expanding our products and services into new markets in an efficient and cost-effective manner.
• Focus on Relationship Banking and Core Deposits
  We focus on the acquisition and retention of core non-maturity deposit accounts and expanding customer relationships. Our philosophy is to provide superior, personalized service to our clients. In addition, we intend to increase core non- maturity deposit accounts by growing business banking relationships through the establishment of dedicated business development teams and expanded product lines tailored to meet our target business customers' needs. Core non-maturity deposit accounts totaled $3.55 billion at June 30, 2024, representing 68.8% of total deposits.
• Diversify Loan Portfolio
  We continue to focus on the diversification of our loan portfolio through the origination of higher yielding commercial and industrial ("C&I"), owner-occupied commercial real estate and home equity line of credit ("HELOC") loans to improve net margins and manage interest rate risk. To that end, we have assembled a team of relationship managers with vast experience working with small to middle-market businesses.
• Continue Focus on Operating Efficiency
  We plan to continue to improve operating efficiency through organic means, such as the increased use of technology and the continual evaluation of our branch network. We plan to continue to evaluate and optimize the performance of our existing branch network through additional branch consolidations, where appropriate. Such efforts will take into consideration historical branch profitability, market demographic trajectory, technology, geographic proximity of consolidating branches and the expected impact on the Bank's clients and communities served.
  In December 2022, we announced the adoption of a company-wide operating efficiency initiative that included the optimization and reduction of vendor spend, the automation or outsourcing of routine activities, and the realignment of our workforce. Excluding the impact of a non-cash goodwill impairment and other non-recurring items, this operating efficiency initiative reduced our non-interest expense by $4.4 million to $117.8 million for the year ended June 30, 2024 from $122.2 million for the year ended June 30, 2023.

Market Area. At June 30, 2024, our primary market area consisted of the counties in which we currently operate branches, including Bergen, Essex, Hudson, Middlesex, Monmouth, Morris, Ocean, Passaic, Somerset and Union counties in New Jersey and Kings (Brooklyn) and Richmond (Staten Island) counties in New York. Our lending is concentrated in New Jersey and New York and our predominant sources of deposits are the communities in which our offices are located as well as the neighboring communities.

Competition. We operate in a highly competitive market area with a large concentration of financial institutions and we face substantial competition in attracting deposits and in originating loans. A number of our competitors are significantly larger institutions with greater financial and technological resources and lending limits. Our ability to compete successfully is a significant factor affecting our growth potential and profitability. Our competition for deposits and loans comes from other insured depository institutions located in our primary market area as well as out-of-market depository institutions operating via online channels and from non-depository institutions including mortgage banks, finance companies, insurance companies, brokerage firms and financial technology companies.

4

Lending Activities

General. Our loan portfolio is comprised of multi-family mortgage loans, nonresidential mortgage loans, commercial business loans, construction loans, one- to four-family residential mortgage loans, home equity loans and other consumer loans. In recent years our lending strategies have placed increasing emphasis on the origination of commercial loans.

Loan Portfolio Composition. The following table sets forth the composition of our loan portfolio in dollar amounts and as a percentage of the total portfolio at the dates indicated.

The following table sets forth the composition of our real estate secured loans indicating the loan-to-value ("LTV"), by loan category, at June 30, 2024 and 2023:

5

Loan Maturity Schedule. The following table sets forth the maturities of our loan portfolio at June 30, 2024. Demand loans, loans having no stated maturity and overdrafts are shown as due in one year or less. Loans are stated in the following table at contractual maturity and actual maturities could differ due to prepayments.

The following table shows the loans as of June 30, 2024 due after June 30, 2025 according to rate type and loan category:

Multi-Familyand Nonresidential Real Estate Mortgage Loans. At June 30, 2024, multi-family mortgage loans totaled $2.65 billion, or 46.0% of our loan portfolio, while nonresidential mortgage loans totaled $948.1 million, or 16.5% of our loan portfolio. We originate commercial mortgage loans on a variety of multi-family and nonresidential property types, including loans on mixed-use properties which combine residential and commercial space. We generally offer fixed-rate and adjustable-rate balloon mortgage loans on multi-family and nonresidential properties with final stated maturities ranging from three to 15 years with amortization terms which generally range from 15 to 30 years. Our commercial mortgage loans are primarily secured by properties located in New Jersey, New York and the surrounding states.

Commercial and Industrial Business (C&I) Loans. At June 30, 2024, commercial and industrial business loans totaled $142.7 million, or 2.5% of our loan portfolio. We originate commercial term loans and lines of credit to a variety of clients in our market area. Our commercial term loans generally have terms of up to 10 years. Our commercial lines of credit have terms of up to one year and are generally floating-rate loans.

Construction Lending. At June 30, 2024, construction loans totaled $209.2 million, or 3.6% of our loan portfolio. Our construction lending includes loans to individuals, builders or developers for the construction of multi-family residential buildings or commercial real estate or for the construction or renovation of one- to four-family residences. Construction borrowers must hold title to the land free and clear of any liens. Financing for construction loans is limited to 80% of the anticipated appraised value of the completed property. Disbursements are made in accordance with inspection reports by our approved appraisal firms. Terms of financing are generally limited to one year with an interest rate tied to the prime rate and may include a premium of one or more points. In some cases, we convert a construction loan to a permanent mortgage loan upon completion of construction. We have no formal limits as to the number of projects a builder has under construction or development and make a case-by-case determination on loans to builders and developers who have multiple projects under development.

6

One- toFour-FamilyResidential Mortgage Loans Held in Portfolio. At June 30, 2024, one- to four-family residential mortgage loans totaled $1.76 billion, or 30.5% of our loan portfolio. At June 30, 2024, $1.63 billion, or 92.7%, of our one- to four-family residential mortgage loans were secured by properties located within New Jersey and New York with the remaining $129.1 million, or 7.3%, secured by properties in other states. The fixed-rate residential mortgage loans that we originate for portfolio generally meet the secondary mortgage market standards of the Federal Home Loan Mortgage Corporation ("Freddie Mac"). In addition, we offer a first-time homebuyer program which provides financial incentives for persons who have not previously owned real estate and are purchasing a one- to four-family property in our primary lending area for use as a primary residence.

One- toFour-FamilyResidential Mortgage Loans Held for Sale. As a complement to our residential one- to four- family portfolio lending activities, we operate a mortgage banking platform which supports the origination of one- to four-family mortgage loans for sale into the secondary market. The loans we originate for sale generally meet the secondary mortgage market standards of Freddie Mac. Such loans are generally originated by, and sourced from, the same resources and markets as those loans originated and held in our portfolio. Our mortgage banking business strategy resulted in the recognition of $602,000 in gains associated with the sale of $79.1 million of mortgage loans held for sale during the year ended June 30, 2024. As of that date, an additional $6.0 million of loans were held and committed for sale into the secondary market.

Home Equity Loans. At June 30, 2024, home equity loans totaled $44.1 million, or 0.8% of our loan portfolio. Our home equity loans are fixed-rate loans for terms of generally up to 20 years. We also offer fixed-rate and adjustable-rate home equity lines of credit with terms of up to 20 years.

Other Consumer Loans. At June 30, 2024, other consumer loans totaled $2.7 million, or 0.05% of our loan portfolio. Our consumer loan portfolio includes unsecured overdraft lines of credit and personal loans as well as loans secured by savings accounts and certificates of deposit on deposit with the Bank.

Loans to One Borrower. New Jersey law generally limits the amount that a savings bank may lend to a single borrower and related entities to 15% of the institution's capital funds. Accordingly, as of June 30, 2024, our legal loans to one borrower limit was approximately $103.3 million.

At June 30, 2024, our largest single borrower had an aggregate outstanding loan exposure of approximately $96.9 million comprising six multi-family mortgage loans. At June 30, 2024, this lending relationship was current and performing in accordance with the terms of their loan agreements.

7