Private Bancorp of America, Inc. Announces Third Quarter 2022 Financial Results
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Third Quarter Highlights
- Net income for the third quarter of 2022 was $6.4 million, up 44.4% from the prior quarter and 25.7% from the same period in the prior year
- Diluted earnings per share for the third quarter of 2022 was $1.12, up 45.5% from the prior quarter and 25.8% from the same period in the prior year
- Total loans held-for-investment (“HFI”), excluding Paycheck Protection Program (“PPP”) loans, reached $1.5 billion at September 30, 2022, an increase of $108.9 million or 7.9% from the prior quarter and $367.8 million or 32.9% from the same period in the prior year.
- Non-interest-bearing demand deposits grew $16.2 million or 2.2% from the prior quarter and $117.0 million or 18.1% from same period in the prior year, representing 49.9% of total deposits
- Net interest margin (ex-PPP loans) of 4.97% compared to 4.57% for the prior quarter and 4.27% for the same period in the prior year
- Total cost of funding sources increased to 0.36% for the third quarter of 2022 from 0.20% in the prior quarter. Total cost of deposits, including noninterest-bearing demand deposits, remained low at 0.27%
- The provision for loan losses for the third quarter of 2022 was $1.3 million, an increase of $657 thousand compared to the prior quarter and was attributed to organic loan growth
- Allowance for loan losses was 1.29% of total loans HFI (ex-PPP loans) at September 30, 2022 compared with 1.29% in the prior quarter
- Tangible book value per share was $23.49 at September 30, 2022, up $0.81 from Q2’22 reflecting strong earnings that was partially offset by an increase in unrealized losses on the securities portfolio
- Private Bancorp of America, Inc. (“PBAM”) remains well capitalized with Tier 1 risk-based capital ratio of 9.35% (preliminary)
LA JOLLA, Calif., Oct. 21, 2022 (GLOBE NEWSWIRE) -- Private Bancorp of America, Inc. (OTCQX:PBAM), (“Company”) and CalPrivate Bank (“Bank”) announced unaudited financial results for the third quarter ended September 30, 2022. The Company reported net income of $6.4 million, or $1.12 per diluted share, for the third quarter of 2022 compared to $4.4 million, or $0.77 per diluted share for the prior quarter.
Rick Sowers, President and CEO of the Company and the Bank stated, “CalPrivate’s core franchise demonstrated its resiliency by continuing to organically grow loans and deposits which resulted in strong growth in net interest income to $20.6 million, well ahead of last quarter’s record. Additionally, while increasing our revenue growth, we continued our efforts to monitor and manage our non-interest expenses.”
Sowers continued, “While global events and domestic uncertainty has put pressure on the overall financial markets and on the banking industry in general, our proven model of focusing on Relationships, Solutions, and Trust continues to resonate with our Clients and prospective Clients. Specifically, our ability to organically grow net loans (ex-PPP loans) by $108.9 million in Q3’22, which represented linked-quarter growth of 7.9%, attests to the success of our Team.
Additionally, while the Federal Reserve continued on its path to raise rates in the third quarter to combat inflationary pressures, our deep Client Relationships and Distinctively Different Service™, demonstrated by our remarkable net promoter score (NPS™) of 84, more than twice the score for the U.S. Banking Industry average, enabled the Bank to grow noninterest-bearing deposits by $16.2 million while keeping the overall cost of interest-bearing deposits low at 0.36%. While we anticipate that funding costs will continue to increase and the potential movement of funds from noninterest-bearing to interest bearing accounts will occur, we are staying very close to our Clients to ensure we are here for them in these uncertain times.”
The rapidly changing economic climate has resulted in volatile interest rates, which has impacted the mark-to-market on the Bank’s securities portfolio as well as the Bank’s ability to originate and sell SBA 7a loans in the secondary market. Nonetheless, the Bank’s vigilant efforts to monitor and manage non-interest expenses resulted in an efficiency ratio of 53.3% from 64.9% in the prior quarter.
While the industry faces significant headwinds, generational high inflation rates and an increased possibility of a recession, the Company continues to invest in the infrastructure needed to drive efficiency and to support the growth of our Relationship Teams committed to serving our Clients.
“The Company continues to exhibit successful customer acquisition as shown by the organic growth in loans and deposits, despite a rising rate environment. Management and staff’s ability to stay focused on providing Exceptional Client Service is readily apparent in the Company’s impressive financial results,” said Selwyn Isakow, Chairman of the Board of the Company and the Bank.
Isakow added, “We are pleased with CalPrivate’s financial performance in the third quarter of 2022, however, we remain cautious on the overall economy. We are confident in Management’s ability to react to developing global events that will impact the Bank domestically, including the very real possibility of a global recession due to significant geopolitical and economic challenges stemming from high inflation, increasing interest rates, energy supply constraints, volatile global politics, increased cyber security risks, and the on-going war in Ukraine.”
STATEMENT OF INCOME
Net Interest Income
Net interest income for the third quarter totaled $20.6 million, representing an increase of $2.6 million or 14.6% compared to the second quarter of 2022. The increase in net interest income for the third quarter of 2022 was primarily due to increases in organic non-PPP average loan balances and higher interest rates. PPP interest and fee income was $123 thousand in Q3’22, compared to $224 thousand in Q2’22. As of September 30, 2022, only 4 PPP loans with total balances of $1.3 million remained unforgiven by the SBA. Interest expense on deposits increased $601 thousand in the third quarter of 2022 vs. the prior quarter due to higher average interest-bearing deposits and an increase in the deposit rates paid to Clients.
Net Interest Margin
The net interest margin for Q3’22 was 4.99% compared to 4.61% for the second quarter of 2022. Excluding PPP-loans, the net interest margin for Q3’22 was 4.97% compared to 4.57% for the second quarter of 2022. The 0.38% increase in the as reported net interest margin for the third quarter was due to higher loan balances and higher loan yields. Average portfolio loan yields (ex-PPP) were 5.77% for Q3’22, compared to 5.33% for Q2’22, including loan prepayment fees. The yield on earning assets was 5.32% for Q3’22 compared with 4.80% for Q2’22 and the cost of funds was 0.36% for Q3’22 compared to 0.20% for Q2’22.
Provision for Loan Losses
The provision for loan losses for the third quarter was $1.3 million, an increase of $657 thousand compared to the second quarter of 2022. While the loan portfolio has not experienced any losses, geopolitical events and high inflation have created uncertainty, and this is reflected in our ALLL to total loans HFI (ex-PPP loans) of 1.29%. This level has been consistently in the range of 1.41% to 1.29% since September 2020, reflecting the current solid credit metrics in the portfolio.
Non-Interest Income
Non-interest income was $1.4 million for the third quarter of 2022 and remained flat as compared to the second quarter of 2022. SBA loan sales for the third quarter of 2022 were $10.4 million with a 9.2% average trade premium resulting in a net gain on sale of $647 thousand, compared with $9.9 million with a 10.5% average trade premium resulting in a net gain on sale of $768 thousand in the second quarter of 2022.
Non-Interest Expense
Non-interest expense was $11.7 million for the third quarter representing a $873 thousand, or 6.9% decrease compared to the second quarter of 2022. Much of the decrease was related to the increased accruals in the prior quarter for professional services and other expenses given the active and on-going lawsuit for the recovery of the charged-off loan related to the ANI Development, LLC/Gina Champion-Cain fraud case and Chicago Title (parent company, Fidelity National Financial) for their alleged involvement with the fraud scheme.
Additionally, the Company remains committed to making investments in the business, including technology, marketing, and staffing. Historically high inflation and low unemployment has resulted in pressure on wages as well as increased costs related to third party service providers, which we proactively monitor and manage.
STATEMENT OF FINANCIAL CONDITION
Balance Sheet
At September 30, 2022, the Company reported total assets of $1.7 billion representing an increase of $114.8 million or 7.1% compared to the second quarter of 2022. The increase in assets for the second quarter was due to increases in loans supported by growth in deposits and wholesale borrowings from the FHLB. Total loans HFI increased to $1.5 billion at September 30, 2022 or $107.6 million, up 7.8%; excluding PPP loans, total loans increased $108.9 million, up 7.9%. Total deposits were $1.5 billion at September 30, 2022 representing an increase of $89.9 million, or 6.2%, compared to the second quarter of 2022. Total non-interest-bearing deposits represented 49.9% of total deposits at September 30, 2022. Additionally, during the third quarter of 2022, the mark-to-market fair value net unrealized losses on the securities portfolio, which consisted mainly of US Treasury and Government Agency debt, increased to pre-tax -$15.2 million from -$12.5 million from the prior quarter. The average duration of the Bank’s securities portfolio is 4.4 years.
Asset Quality
The Allowance for Loan Losses increased $1.3 million to $19.1 million in the quarter with a resulting coverage ratio of 1.29% of total loans HFI, excluding PPP loans. The increase in the Allowance for Loan Losses was primarily due to non-PPP organic loan growth and qualitative loss factors related to the general economic outlook in the markets we serve.
As of September 30, 2022, there were no doubtful credits or charge-offs and classified assets were $15.9 million, up $4.8 million compared to Q2’22. Total classified assets consisted of 13 loans, of which 7 loans totaling $10.1 million were secured by real estate with a weighted average LTV of 42.8%. The remaining 6 loans included 5 SBA loans with a balance of $3.3 million and were 75% guaranteed by the SBA.
Capital Ratios (1)
The Company and the Bank’s capital ratios were in excess of the levels established for “well capitalized” institutions and are as follows:
| Sep 30, 2022 (1) | Jun 30, 2022 | Mar 31, 2022 | |
| Private Bancorp of America | |||
| Tier I leverage ratio | 8.64% | 8.61% | 8.85% |
| Tier I risk-based capital ratio | 9.35% | 10.29% | 10.31% |
| Total risk-based capital ratio | 11.77% | 12.99% | 12.94% |
| CalPrivate Bank | |||
| Tier I leverage ratio | 9.57% | 9.58% | 9.72% |
| Tier I risk-based capital ratio | 10.36% | 11.44% | 11.93% |
| Total risk-based capital ratio | 11.60% | 12.79% | 13.18% |
(1) September 30, 2022, capital ratios are preliminary
About Private Bancorp of America, Inc.
Private Bancorp of America, Inc. (OTCQX: PBAM), is the holding company for CalPrivate Bank. CalPrivate Bank provides a Distinctly Different banking experience through unparalleled service and creative funding solutions to high-net-worth individuals, professionals, locally owned businesses, and real estate entrepreneurs. Customers are serviced through offices in Coronado, San Diego, La Jolla, Newport Beach, El Segundo and Beverly Hills as well as efficient electronic banking offerings. The Bank also offers various portfolio and government guaranteed lending programs, including SBA and cross-border Export-Import Bank programs. CalPrivate Bank is an SBA Preferred Lender and a Bauer Financial 5-star rated bank.
CalPrivate Bank’s website is www.calprivate.bank.
Non-GAAP Financial Measures
This press release contains certain non-GAAP financial measures in addition to results presented in accordance with GAAP. The Company uses certain non-GAAP financial measures to provide meaningful supplemental information regarding the Company's results of operations and financial condition and to enhance investors’ overall understanding of such results of operations and financial condition, permit investors to effectively analyze financial trends of our business activities, and enhance comparability with peers across the financial services sector. These non-GAAP financial measures are not a substitute for GAAP measures and should be read in conjunction with the Company’s GAAP financial information. A reconciliation of GAAP financial measures to non-GAAP financial measures is included in the accompanying financial tables.
Investor Relations Contacts
Rick Sowers
President and Chief Executive Officer
Private Bancorp of America, Inc., and CalPrivate Bank
(424) 303-4894
Mag Wangsuwana
Executive Vice President and Chief Financial Officer
Private Bancorp of America, Inc., and CalPrivate Bank
(424) 348-2145
Safe Harbor Paragraph
This press release includes forward-looking statements that involve inherent risks and uncertainties. Private Bancorp of America, Inc. cautions readers that a number of important factors could cause actual results to differ materially from those in the forward‐looking statements. These factors include the effects of the COVID-19 pandemic and related government actions on the Bank and its customers, loan losses, economic conditions and competition in the geographic and business areas in which Private Bancorp of America, Inc. operates, our ability to successfully integrate and develop business through the addition of new personnel and facilities and merged banks, whether our efforts to expand loan, product and service offerings will prove profitable, the effects of the bank mergers and acquisitions in our markets, system failures and internet security, inflation, fluctuations in interest rates, legislation and governmental regulation. You should not place undue reliance on forward‐looking statements, and we undertake no obligation to update those statements whether as a result of changes in underlying factors, new information, future events or otherwise.
| PRIVATE BANCORP OF AMERICA, INC. | ||||||||||||
| CONSOLIDATED BALANCE SHEET | ||||||||||||
| (Unaudited) | ||||||||||||
| (Dollars in thousands) | ||||||||||||
| September 30, 2022 | June 30, 2022 | September 30, 2021 | ||||||||||
| Assets | ||||||||||||
| Cash and due from banks | $ | 13,506 | $ | 15,694 | $ | 12,570 | ||||||
| Interest-bearing deposits in other financial institutions | 44,776 | 43,857 | 2,736 | |||||||||
| Interest-bearing deposits at Federal Reserve Bank | 43,891 | 29,241 | 123,247 | |||||||||
| Total cash and due from banks | 102,173 | 88,792 | 138,553 | |||||||||
| Interest-bearing time deposits with other institutions | 6,157 | 6,157 | 5,760 | |||||||||
| Investment securities available for sale | 107,332 | 113,565 | 93,099 | |||||||||
| Loan held for sale | 7,789 | 4,460 | 35,448 | |||||||||
| Total loans held-for-investment | 1,487,098 | 1,379,519 | 1,192,135 | |||||||||
| Allowance for loan losses | (19,092 | ) | (17,776 | ) | (16,141 | ) | ||||||
| Net loans | 1,468,006 | 1,361,743 | 1,175,994 | |||||||||
| Federal Home Loan Bank stock, at cost | 7,020 | 7,020 | 4,909 | |||||||||
| Right of use asset | 2,669 | 3,037 | 4,115 | |||||||||
| Premises and equipment, net | 2,040 | 2,640 | 2,459 | |||||||||
| Servicing assets, net | 3,502 | 3,515 | 2,374 | |||||||||
| Deferred tax asset | 7,212 | 9,229 | 6,256 | |||||||||
| Accrued interest receivable | 4,262 | 3,855 | 3,404 | |||||||||
| Other assets | 8,739 | 8,089 | 2,311 | |||||||||
| Total assets | $ | 1,726,901 | $ | 1,612,102 | $ | 1,474,682 | ||||||
| Liabilities and Shareholders' Equity | ||||||||||||
| Liabilities | ||||||||||||
| Noninterest bearing | $ | 763,227 | $ | 747,006 | $ | 646,233 | ||||||
| Interest Bearing | 767,371 | 693,646 | 667,012 | |||||||||
| Total deposits | 1,530,598 | 1,440,652 | 1,313,245 | |||||||||
| FHLB borrowings | 30,000 | 10,000 | 10,000 | |||||||||
| Other borrowings | 17,952 | 17,950 | 17,945 | |||||||||
| Accrued interest payable and other liabilities | 13,417 | 13,305 | 11,613 | |||||||||
| Total liabilities | 1,591,967 | 1,481,907 | 1,352,803 | |||||||||
| Shareholders' equity | ||||||||||||
| Common stock | 71,671 | 71,516 | 70,470 | |||||||||
| Additional paid-in capital | 3,568 | 3,368 | 3,465 | |||||||||
| Retained earnings | 70,386 | 64,036 | 47,845 | |||||||||
| Accumulated other comprehensive (loss) income, net | (10,691 | ) | (8,725 | ) | 99 | |||||||
| Total stockholders' equity | 134,934 | 130,195 | 121,879 | |||||||||
| Total liabilities and stockholders' equity | $ | 1,726,901 | $ | 1,612,102 | $ | 1,474,682 | ||||||
| PRIVATE BANCORP OF AMERICA, INC. | |||||||||||||||
| CONSOLIDATED STATEMENTS OF INCOME | |||||||||||||||
| (Unaudited) | |||||||||||||||
| (Dollars in thousands, except per share amounts) | |||||||||||||||
| For the three months ended | For the nine months ended | ||||||||||||||
| September 30, 2022 | June 30, 2022 | September 30, 2021 | September 30, 2022 | September 30, 2021 | |||||||||||
| Interest Income | |||||||||||||||
| Loans | $ | 21,028 | $ | 17,931 | $ | 16,068 | $ | 56,205 | $ | 44,865 | |||||
| Investment securities | 578 | 571 | 330 | 1,550 | 986 | ||||||||||
| Deposits in other financial institutions | 372 | 204 | 60 | 711 | 158 | ||||||||||
| Total interest income | 21,978 | 18,706 | 16,458 | 58,466 | 46,009 | ||||||||||
| Interest Expense | |||||||||||||||
| Deposits | 1,011 | 410 | 409 | 1,748 | 1,336 | ||||||||||
| Borrowings | 364 | 313 | 332 | 991 | 2,571 | ||||||||||
| Total interest expense | 1,375 | 723 | 741 | 2,739 | 3,907 | ||||||||||
| Net interest income | 20,603 | 17,983 | 15,717 | 55,727 | 42,102 | ||||||||||
| Provision for loan losses | 1,316 | 659 | 433 | 2,118 | 1,879 | ||||||||||
| Net interest income after provision for loan losses | 19,287 | 17,324 | 15,284 | 53,609 | 40,223 | ||||||||||
| Noninterest income: | |||||||||||||||
| Service charges on deposit accounts | 306 | 299 | 236 | 887 | 691 | ||||||||||
| Net gain on sale of loans | 647 | 768 | 1,837 | 3,886 | 5,639 | ||||||||||
| Other noninterest income | 452 | 375 | 316 | 1,184 | 736 | ||||||||||
| Total noninterest income | 1,405 | 1,442 | 2,389 | 5,957 | 7,066 | ||||||||||
| Noninterest expense: | |||||||||||||||
| Salary and employee benefits | 7,261 | 7,374 | 6,595 | 21,948 | 17,476 | ||||||||||
| Occupancy and equipment | 756 | 808 | 1,484 | 2,287 | 3,114 | ||||||||||
| Data processing | 993 | 824 | 799 | 2,469 | 2,124 | ||||||||||
| Professional services | 1,493 | 1,835 | 552 | 4,243 | 1,994 | ||||||||||
| Other expenses | 1,224 | 1,759 | 1,034 | 4,222 | 2,688 | ||||||||||
| Total noninterest expense | 11,727 | 12,600 | 10,464 | 35,169 | 27,396 | ||||||||||
| Income before provision for income taxes | 8,965 | 6,166 | 7,209 | 24,397 | 19,893 | ||||||||||
| Provision for income taxes | 2,614 | 1,769 | 2,158 | 7,131 | 5,942 | ||||||||||
| Net income | $ | 6,351 | $ | 4,397 | $ | 5,051 | $ | 17,266 | $ | 13,951 | |||||
| Net income available to common shareholders | $ | 6,306 | $ | 4,347 | $ | 4,984 | $ | 17,115 | $ | 13,744 | |||||
| Earnings per share | |||||||||||||||
| Basic earnings per share | $ | 1.14 | $ | 0.78 | $ | 0.90 | $ | 3.08 | $ | 2.48 | |||||
| Diluted earnings per share | $ | 1.12 | $ | 0.77 | $ | 0.89 | $ | 3.03 | $ | 2.45 | |||||
| Average shares outstanding | 5,549,480 | 5,543,065 | 5,543,403 | 5,559,122 | 5,531,590 | ||||||||||
| Diluted average shares outstanding | 5,640,841 | 5,639,282 | 5,629,900 | 5,657,117 | 5,611,616 | ||||||||||
| PRIVATE BANCORP OF AMERICA, INC. | |||||||||||||||||||||||||||
| Consolidated average balance sheet, interest, yield and rates | |||||||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||||||
| For the three months ended | |||||||||||||||||||||||||||
| September 30, 2022 | June 30, 2022 | September 30, 2021 | |||||||||||||||||||||||||
| Average Balance | Interest | Average Yield/Rate | Average Balance | Interest | Average Yield/Rate | Average Balance | Interest | Average Yield/Rate | |||||||||||||||||||
| Interest-Earnings Assets | |||||||||||||||||||||||||||
| Deposits in other financial institutions | $ | 77,353 | $ | 372 | 1.91 | % | $ | 100,017 | $ | 204 | 0.82 | % | $ | 142,647 | $ | 60 | 0.17 | % | |||||||||
| Investment securities | 122,184 | 578 | 1.89 | % | 125,550 | 571 | 1.82 | % | 92,458 | 330 | 1.43 | % | |||||||||||||||
| Loans, including LHFS | 1,438,489 | 21,028 | 5.80 | % | 1,339,095 | 17,931 | 5.37 | % | 1,185,865 | 16,068 | 5.38 | % | |||||||||||||||
| Total interest-earning assets | 1,638,026 | 21,978 | 5.32 | % | 1,564,662 | 18,706 | 4.80 | % | 1,420,970 | 16,458 | 4.60 | % | |||||||||||||||
| Noninterest-earning assets | 27,465 | 27,614 | 21,308 | ||||||||||||||||||||||||
| Total Assets | $ | 1,665,491 | $ | 1,592,276 | $ | 1,442,278 | |||||||||||||||||||||
| Interest-Bearing Liabilities | |||||||||||||||||||||||||||
| Interest-bearing transaction accounts | $ | 92,986 | $ | 166 | 0.71 | % | $ | 87,682 | $ | 54 | 0.25 | % | $ | 68,618 | $ | 14 | 0.08 | % | |||||||||
| Money market | 535,473 | 680 | 0.50 | % | 492,838 | 241 | 0.20 | % | 493,289 | 245 | 0.20 | % | |||||||||||||||
| Savings deposits | 13,437 | 8 | 0.24 | % | 14,216 | 3 | 0.01 | % | 9,639 | 3 | 0.12 | % | |||||||||||||||
| Certificates of deposit | 69,676 | 157 | 0.89 | % | 67,184 | 112 | 0.66 | % | 68,761 | 147 | 0.85 | % | |||||||||||||||
| Total Interest-Bearing Deposits | 711,572 | 1,011 | 0.56 | % | 661,920 | 410 | 0.25 | % | 640,307 | 409 | 0.25 | % | |||||||||||||||
| FHLB advances | 15,299 | 92 | 2.39 | % | 10,000 | 42 | 1.64 | % | 14,783 | 60 | 1.61 | % | |||||||||||||||
| Other borrowings | 17,951 | 272 | 6.06 | % | 17,948 | 271 | 6.06 | % | 17,944 | 272 | 6.06 | % | |||||||||||||||
| Total Interest-Bearing Liabilities | 33,250 | 364 | 4.34 | % | 27,948 | 313 | 4.49 | % | 32,727 | 332 | 4.02 | % | |||||||||||||||
| Noninterest-bearing deposits | 771,167 | 757,728 | 636,042 | ||||||||||||||||||||||||
| Total Funding Sources | 1,515,989 | 1,375 | 0.36 | % | 1,447,596 | 723 | 0.20 | % | 1,309,076 | 741 | 0.22 | % | |||||||||||||||
| Noninterest-bearing liabilities | 4,775 | 11,891 | 12,584 | ||||||||||||||||||||||||
| Shareholders' equity | 144,727 | 132,789 | 120,618 | ||||||||||||||||||||||||
| Total Liabilities and Shareholders' Equity | $ | 1,665,491 | $ | 1,592,276 | $ | 1,442,278 | |||||||||||||||||||||
| Net interest income/spread | $ | 20,603 | 4.96 | % | $ | 17,983 | 4.60 | % | $ | 15,717 | 4.38 | % | |||||||||||||||
| Net interest margin | 4.99 | % | 4.61 | % | 4.39 | % | |||||||||||||||||||||
| PRIVATE BANCORP OF AMERICA, INC. | |||||||||||||||||||
| Consolidated average balance sheet, interest, yield and rates | |||||||||||||||||||
| (Unaudited) | |||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||
| For the nine months ended | |||||||||||||||||||
| September 30, 2022 | September 30, 2021 | ||||||||||||||||||
| Average Balance | Interest | Average Yield/Rate | Average Balance | Interest | Average Yield/Rate | ||||||||||||||
| Interest-Earnings Assets: | |||||||||||||||||||
| Deposits in other financial institutions | $ | 97,946 | $ | 711 | 0.97 | % | $ | 172,601 | $ | 158 | 0.12 | % | |||||||
| Investment securities | 119,042 | 1,550 | 1.74 | % | 80,061 | 986 | 1.65 | % | |||||||||||
| Loans | 1,349,382 | 56,205 | 5.57 | % | 1,119,400 | 44,865 | 5.36 | % | |||||||||||
| Total interest-earning assets | 1,566,370 | 58,466 | 4.99 | % | 1,372,062 | 46,009 | 4.48 | % | |||||||||||
| Noninterest-earning assets | 25,751 | 20,023 | |||||||||||||||||
| Total Assets | $ | 1,592,121 | $ | 1,392,085 | |||||||||||||||
| Interest-Bearing Liabilities | |||||||||||||||||||
| Interest-bearing transaction accounts | $ | 86,461 | $ | 235 | 0.36 | % | $ | 64,020 | $ | 36 | 0.08 | % | |||||||
| Money market | 508,956 | 1,115 | 0.29 | % | 449,920 | 713 | 0.21 | % | |||||||||||
| Savings deposits | 13,725 | 15 | 0.15 | % | 9,215 | 7 | 0.10 | % | |||||||||||
| Certificates of deposit | 68,466 | 383 | 0.75 | % | 81,490 | 580 | 0.95 | % | |||||||||||
| Total Interest-Bearing Deposits | 677,608 | 1,748 | 0.34 | % | 604,645 | 1,336 | 0.30 | % | |||||||||||
| FHLB advances | 11,786 | 175 | 1.99 | % | 42,784 | 1,756 | 5.49 | % | |||||||||||
| Other borrowings | 17,949 | 816 | 6.08 | % | 17,942 | 815 | 6.07 | % | |||||||||||
| Total Interest-Bearing Liabilities | 29,735 | 991 | 4.46 | % | 60,726 | 2,571 | 5.66 | % | |||||||||||
| Noninterest-bearing deposits | 737,578 | 597,992 | |||||||||||||||||
| Total Funding Sources | 1,444,921 | 2,739 | 0.25 | % | 1,263,363 | 3,907 | 0.41 | % | |||||||||||
| Noninterest-bearing liabilities | 12,955 | 13,421 | |||||||||||||||||
| Shareholders' equity | 134,245 | 115,301 | |||||||||||||||||
| Total Liabilities and Shareholders' Equity | $ | 1,592,121 | $ | 1,392,085 | |||||||||||||||
| Net interest income/spread | $ | 55,727 | 4.74 | % | $ | 42,102 | 4.07 | % | |||||||||||
| Net interest margin | 4.76 | % | 4.10 | % | |||||||||||||||
| PRIVATE BANCORP OF AMERICA, INC. | ||||||||||||||||||||
| Condensed Balance Sheets | ||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||
| (Dollars in thousands, except per share amounts) | ||||||||||||||||||||
| Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | ||||||||||||||||
| Assets | ||||||||||||||||||||
| Cash and due from banks | $ | 102,173 | $ | 88,792 | $ | 124,015 | $ | 149,085 | $ | 138,553 | ||||||||||
| Interest-bearing time deposits with other institutions | 6,157 | 6,157 | 5,817 | 5,760 | 5,760 | |||||||||||||||
| Investment securities | 107,332 | 113,565 | 114,382 | 102,065 | 93,099 | |||||||||||||||
| Loans held for sale | 7,789 | 4,460 | 1,999 | 24,658 | 35,448 | |||||||||||||||
| Total loans held-for-investment (excluding PPP loans) | 1,485,749 | 1,376,801 | 1,276,043 | 1,188,634 | 1,117,983 | |||||||||||||||
| SBA PPP loans | 1,349 | 2,718 | 8,795 | 35,524 | 74,152 | |||||||||||||||
| Allowance for loan losses | (19,092 | ) | (17,776 | ) | (17,117 | ) | (16,975 | ) | (16,141 | ) | ||||||||||
| Net loans | 1,468,006 | 1,361,743 | 1,267,721 | 1,207,183 | 1,175,994 | |||||||||||||||
| Right of use asset | 2,669 | 3,037 | 3,400 | 3,760 | 4,115 | |||||||||||||||
| Premises and equipment, net | 2,040 | 2,640 | 2,813 | 2,294 | 2,459 | |||||||||||||||
| Other assets and interest receivable | 30,735 | 31,708 | 25,335 | 22,279 | 19,254 | |||||||||||||||
| Total assets | $ | 1,726,901 | $ | 1,612,102 | $ | 1,545,482 | $ | 1,517,084 | $ | 1,474,682 | ||||||||||
| Liabilities and Shareholders' Equity | ||||||||||||||||||||
| Liabilities | ||||||||||||||||||||
| Noninterest Bearing | $ | 763,227 | $ | 747,006 | $ | 724,469 | $ | 682,589 | $ | 646,233 | ||||||||||
| Interest Bearing | 767,371 | 693,646 | 646,545 | 663,074 | 667,012 | |||||||||||||||
| Total Deposits | 1,530,598 | 1,440,652 | 1,371,014 | 1,345,663 | 1,313,245 | |||||||||||||||
| Borrowings | 47,952 | 27,950 | 27,948 | 27,947 | 27,945 | |||||||||||||||
| Accrued interest payable and other liabilities | 13,417 | 13,305 | 14,630 | 15,110 | 11,613 | |||||||||||||||
| Total liabilities | 1,591,967 | 1,481,907 | 1,413,592 | 1,388,720 | 1,352,803 | |||||||||||||||
| Shareholders' equity | ||||||||||||||||||||
| Common stock | 71,671 | 71,516 | 70,899 | 70,850 | 70,470 | |||||||||||||||
| Additional paid-in capital | 3,568 | 3,368 | 3,602 | 3,343 | 3,465 | |||||||||||||||
| Retained earnings | 70,386 | 64,036 | 61,424 | 54,922 | 47,845 | |||||||||||||||
| Accumulated other comprehensive (loss) income | (10,691 | ) | (8,725 | ) | (4,035 | ) | (751 | ) | 99 | |||||||||||
| Total shareholders' equity | 134,934 | 130,195 | 131,890 | 128,364 | 121,879 | |||||||||||||||
| Total liabilities and shareholders' equity | $ | 1,726,901 | $ | 1,612,102 | $ | 1,545,482 | $ | 1,517,084 | $ | 1,474,682 | ||||||||||
| Book value per common share | $ | 24.12 | $ | 23.31 | $ | 23.42 | $ | 22.81 | $ | 21.70 | ||||||||||
| Tangible book value per common share | $ | 23.49 | $ | 22.68 | $ | 22.80 | $ | 22.26 | $ | 21.27 | ||||||||||
| Shares outstanding | 5,594,380 | 5,584,465 | 5,630,993 | 5,627,735 | 5,617,273 | |||||||||||||||
| Regulatory Capital Ratios (PBAM) 1 | ||||||||||||||||||||
| Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | ||||||||||||||||
| Tier 1 leverage ratio | 8.64 | % | 8.61 | % | 8.85 | % | 8.42 | % | 8.19 | % | ||||||||||
| Tier 1 risk-based capital ratio | 9.35 | % | 10.29 | % | 10.31 | % | 10.63 | % | 10.64 | % | ||||||||||
| Common equity Tier 1 ratio | 9.35 | % | 10.29 | % | 10.31 | % | 10.63 | % | 10.64 | % | ||||||||||
| Total risk-based capital ratio | 11.77 | % | 12.99 | % | 12.94 | % | 13.38 | % | 13.48 | % | ||||||||||
| Tangible equity / tangible assets | 8.20 | % | 8.37 | % | 8.59 | % | 8.36 | % | 8.15 | % | ||||||||||
| 1 Preliminary ratios for September 30, 2022 | ||||||||||||||||||||
| PRIVATE BANCORP OF AMERICA, INC. | |||||||||||||||||||
| Condensed Statements of Income | |||||||||||||||||||
| (Unaudited) | |||||||||||||||||||
| (Dollars in thousands, except per share amounts) | |||||||||||||||||||
| For the three months ended | |||||||||||||||||||
| Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | |||||||||||||||
| Interest income | $ | 21,978 | $ | 18,706 | $ | 17,781 | $ | 17,356 | $ | 16,458 | |||||||||
| Interest expense | 1,375 | 723 | 640 | 667 | 741 | ||||||||||||||
| Net interest income | 20,603 | 17,983 | 17,141 | 16,689 | 15,717 | ||||||||||||||
| Provision for loan losses | 1,316 | 659 | 142 | 834 | 433 | ||||||||||||||
| Net interest income after provision for loan losses | 19,287 | 17,324 | 16,999 | 15,855 | 15,284 | ||||||||||||||
| Noninterest income | 1,405 | 1,442 | 3,109 | 4,265 | 2,389 | ||||||||||||||
| Salary and employee benefits | 7,261 | 7,374 | 7,313 | 6,492 | 6,595 | ||||||||||||||
| Occupancy and equipment | 756 | 808 | 723 | 741 | 1,484 | ||||||||||||||
| Data processing | 993 | 824 | 653 | 703 | 799 | ||||||||||||||
| Professional services | 1,493 | 1,835 | 915 | 843 | 552 | ||||||||||||||
| Other expenses | 1,224 | 1,759 | 1,255 | 1,060 | 1,034 | ||||||||||||||
| Total noninterest expense | 11,727 | 12,600 | 10,859 | 9,839 | 10,464 | ||||||||||||||
| Income before provision for income taxes | 8,965 | 6,166 | 9,249 | 10,281 | 7,209 | ||||||||||||||
| Income taxes | 2,614 | 1,769 | 2,747 | 2,986 | 2,158 | ||||||||||||||
| Net income | $ | 6,351 | $ | 4,397 | $ | 6,502 | $ | 7,295 | $ | 5,051 | |||||||||
| Net income available to common shareholders | $ | 6,306 | $ | 4,347 | $ | 6,432 | $ | 7,204 | $ | 4,984 | |||||||||
| Earnings per share | |||||||||||||||||||
| Basic earnings per share | $ | 1.14 | $ | 0.78 | $ | 1.16 | $ | 1.30 | $ | 0.90 | |||||||||
| Diluted earnings per share | $ | 1.12 | $ | 0.77 | $ | 1.13 | $ | 1.28 | $ | 0.89 | |||||||||
| Average shares outstanding | 5,549,480 | 5,543,065 | 5,568,400 | 5,547,422 | 5,543,403 | ||||||||||||||
| Diluted average shares outstanding | 5,640,841 | 5,639,282 | 5,672,701 | 5,638,186 | 5,629,900 | ||||||||||||||
| Performance Ratios | |||||||||||||||||||
| Sep 30, 2022 | Jun 30, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | |||||||||||||||
| ROAA | 1.51 | % | 1.11 | % | 1.74 | % | 1.91 | % | 1.39 | % | |||||||||
| ROAE | 17.41 | % | 13.28 | % | 19.91 | % | 22.72 | % | 16.61 | % | |||||||||
| ROTE (1) | 17.85 | % | 13.64 | % | 20.43 | % | 23.25 | % | 16.94 | % | |||||||||
| Net interest margin | 4.99 | % | 4.61 | % | 4.65 | % | 4.44 | % | 4.39 | % | |||||||||
| Net interest spread | 4.96 | % | 4.60 | % | 4.63 | % | 4.43 | % | 4.38 | % | |||||||||
| Efficiency ratio (1) | 53.29 | % | 64.86 | % | 53.62 | % | 46.96 | % | 57.79 | % | |||||||||
| Noninterest expense / average assets | 2.79 | % | 3.21 | % | 2.90 | % | 2.58 | % | 2.88 | % | |||||||||
| (1) Non-GAAP measure. See GAAP to non-GAAP Reconciliation table. | |||||||||||||||||||
| PRIVATE BANCORP OF AMERICA, INC. | ||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||
| Selected Quarterly Average Balances | ||||||||||||||||||||
| (Dollars in thousands) | ||||||||||||||||||||
| For the three months ended | ||||||||||||||||||||
| Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | ||||||||||||||||
| Total assets | $ | 1,665,491 | $ | 1,592,276 | $ | 1,516,352 | $ | 1,514,583 | $ | 1,442,278 | ||||||||||
| Earning assets | $ | 1,638,026 | $ | 1,564,662 | $ | 1,494,850 | $ | 1,490,235 | $ | 1,420,970 | ||||||||||
| Total loans, including loans held for sale | $ | 1,438,489 | $ | 1,339,095 | $ | 1,268,695 | $ | 1,222,234 | $ | 1,185,865 | ||||||||||
| Total deposits | $ | 1,482,740 | $ | 1,419,648 | $ | 1,341,631 | $ | 1,346,777 | $ | 1,276,349 | ||||||||||
| Total equity | $ | 144,727 | $ | 132,789 | $ | 132,472 | $ | 127,387 | $ | 120,618 | ||||||||||
| Loan Balances by Type | ||||||||||||||||||||
| (Dollars in thousands) | ||||||||||||||||||||
| Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | ||||||||||||||||
| Real estate - investor owned | $ | 403,950 | $ | 390,628 | $ | 350,152 | $ | 324,167 | $ | 307,469 | ||||||||||
| Real estate - owner occupied | 382,689 | 359,270 | 371,840 | 339,081 | 329,985 | |||||||||||||||
| Real estate - multifamily | 136,841 | 121,693 | 105,964 | 97,285 | 82,460 | |||||||||||||||
| Real estate - single family | 107,728 | 94,212 | 89,630 | 86,399 | 81,239 | |||||||||||||||
| Commercial business | 393,020 | 359,692 | 307,421 | 294,944 | 274,708 | |||||||||||||||
| SBA PPP loans | 1,349 | 2,718 | 8,795 | 35,524 | 74,152 | |||||||||||||||
| Land and construction | 55,418 | 44,856 | 44,856 | 39,702 | 34,996 | |||||||||||||||
| Consumer | 6,103 | 6,450 | 6,180 | 7,049 | 7,126 | |||||||||||||||
| Total loans held for investment | $ | 1,487,098 | $ | 1,379,519 | $ | 1,284,838 | $ | 1,224,151 | $ | 1,192,135 | ||||||||||
| Deposits by Type | ||||||||||||||||||||
| (Dollars in thousands) | ||||||||||||||||||||
| Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | ||||||||||||||||
| Non interest bearing DDA | $ | 763,227 | $ | 747,006 | $ | 724,469 | $ | 682,589 | $ | 646,233 | ||||||||||
| Interest bearing DDA | 95,677 | 93,405 | 75,904 | 81,788 | 68,056 | |||||||||||||||
| Savings & MMA | 591,408 | 533,145 | 503,552 | 513,070 | 530,782 | |||||||||||||||
| Retail CD | 3,478 | 3,387 | 3,384 | 5,281 | 5,633 | |||||||||||||||
| Jumbo CD | 76,808 | 63,709 | 63,705 | 62,935 | 62,541 | |||||||||||||||
| Total deposits | $ | 1,530,598 | $ | 1,440,652 | $ | 1,371,014 | $ | 1,345,663 | $ | 1,313,245 | ||||||||||
| Asset Quality | ||||||||||||||||||||
| (Dollars in thousands) | ||||||||||||||||||||
| Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | ||||||||||||||||
| Total loans held-for-investment | $ | 1,487,098 | $ | 1,379,519 | $ | 1,284,838 | $ | 1,224,151 | $ | 1,192,135 | ||||||||||
| Allowance for Loan Losses | $ | (19,092 | ) | $ | (17,776 | ) | $ | (17,117 | ) | $ | (16,975 | ) | $ | (16,141 | ) | |||||
| 30-89 day past due loans | $ | - | $ | - | $ | - | $ | - | $ | 200 | ||||||||||
| 90+ day past due loans | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||
| Nonaccrual loans | $ | 4,593 | $ | 1,453 | $ | 1,453 | $ | 1,510 | $ | 1,494 | ||||||||||
| NPAs / Assets | 0.27 | % | 0.09 | % | 0.09 | % | 0.10 | % | 0.10 | % | ||||||||||
| NPLs / Total loans held-for-investment & OREO | 0.31 | % | 0.11 | % | 0.11 | % | 0.12 | % | 0.12 | % | ||||||||||
| Net quarterly charge-offs | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||
| Net charge-offs/avg loans (annualized) | 0.00 | % | 0.00 | % | 0.00 | % | 0.00 | % | 0.00 | % | ||||||||||
| Allowance for loan losses to loans HFI | 1.28 | % | 1.29 | % | 1.33 | % | 1.39 | % | 1.35 | % | ||||||||||
| Allowance for loan losses to nonaccrual loans | 415.68 | % | 1223.40 | % | 1178.05 | % | 1124.11 | % | 1080.39 | % | ||||||||||
| PRIVATE BANCORP OF AMERICA, INC. | |||||||||||||||||||
| (Unaudited) | |||||||||||||||||||
| The following tables present a reconciliation of non-GAAP financial measures to GAAP measures for: efficiency ratio, pre-tax pre-provision income, average tangible common equity, return on average tangible common equity. We believe the presentation of certain non-GAAP financial measures provides useful information to assess our consolidated financial condition and consolidated results of operations and to assist investors in evaluating our financial results relative to our peers. These non-GAAP financial measures complement our GAAP reporting and are presented below to provide investors and others with information that we use to manage the business each period. Because not all companies use identical calculations, the presentation of these non-GAAP financial measures may not be comparable to other similarly titled measures used by other companies. These non-GAAP measures should be taken together with the corresponding GAAP measures and should not be considered a substitute of the GAAP measures. | |||||||||||||||||||
| GAAP to Non-GAAP Reconciliation | |||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||
| For the three months ended | |||||||||||||||||||
| Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | |||||||||||||||
| Efficiency Ratio | |||||||||||||||||||
| Noninterest expense | $ | 11,727 | $ | 12,600 | $ | 10,859 | $ | 9,839 | $ | 10,464 | |||||||||
| Net interest income | 20,603 | 17,983 | 17,141 | 16,689 | 15,717 | ||||||||||||||
| Noninterest income | 1,405 | 1,442 | 3,109 | 4,265 | 2,389 | ||||||||||||||
| Total net interest income and noninterest income | 22,008 | 19,425 | 20,250 | 20,954 | 18,106 | ||||||||||||||
| Efficiency ratio (non-GAAP) | 53.3 | % | 64.9 | % | 53.6 | % | 47.0 | % | 57.8 | % | |||||||||
| Pre-tax pre-provision income | |||||||||||||||||||
| Net interest income | $ | 20,603 | $ | 17,983 | $ | 17,141 | $ | 16,689 | $ | 15,717 | |||||||||
| Noninterest income | 1,405 | 1,442 | 3,109 | 4,265 | 2,389 | ||||||||||||||
| Total net interest income and noninterest income | 22,008 | 19,425 | 20,250 | 20,954 | 18,106 | ||||||||||||||
| Less: Noninterest expense | 11,727 | 12,600 | 10,859 | 9,839 | 10,464 | ||||||||||||||
| Pre-tax pre-provision income (non-GAAP) | $ | 10,281 | $ | 6,825 | $ | 9,391 | $ | 11,115 | $ | 7,642 | |||||||||
| Return on Average Assets, Average Equity, Average Tangible Equity | |||||||||||||||||||
| Net income | $ | 6,351 | $ | 4,397 | $ | 6,502 | $ | 7,295 | $ | 5,051 | |||||||||
| Average assets | 1,665,491 | 1,592,276 | 1,516,352 | 1,514,583 | 1,442,278 | ||||||||||||||
| Average shareholders' equity | 144,727 | 132,789 | 132,472 | 127,387 | 120,618 | ||||||||||||||
| Less: Average intangible assets | 3,599 | 3,490 | 3,379 | 2,908 | 2,337 | ||||||||||||||
| Average tangible common equity (non-GAAP) | 141,128 | 129,299 | 129,093 | 124,479 | 118,281 | ||||||||||||||
| Return on average assets | 1.51 | % | 1.11 | % | 1.74 | % | 1.91 | % | 1.39 | % | |||||||||
| Return on average equity | 17.41 | % | 13.28 | % | 19.91 | % | 22.72 | % | 16.61 | % | |||||||||
| Return on average tangible common equity (non-GAAP) | 17.85 | % | 13.64 | % | 20.43 | % | 23.25 | % | 16.94 | % | |||||||||
| Tanigible book value per share | |||||||||||||||||||
| Total equity | 134,934 | 130,195 | 131,890 | 128,364 | 121,879 | ||||||||||||||
| Less: Total intangible assets | 3,502 | 3,525 | 3,079 | 2,374 | 1,789 | ||||||||||||||
| Total tangible equity | 131,432 | 126,670 | 128,811 | 125,990 | 120,090 | ||||||||||||||
| Shares outstanding | 5,594,380 | 5,584,465 | 5,630,993 | 5,627,735 | 5,617,273 | ||||||||||||||
| Tangible book value per share (non-GAAP) | $ | 23.49 | $ | 22.68 | $ | 22.80 | $ | 22.26 | $ | 21.27 | |||||||||
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