Financial Performance - Net income for the three months ended September 30, 2025, increased by $3.1 million, or 41.6%, to $10.6 million compared to $7.5 million for the same period in 2024[96]. - For the nine months ended September 30, 2025, net income available to common shareholders increased by $6.6 million, or 32.7%, to $26.7 million compared to $20.1 million for the same period in 2024[102]. - Net interest income for the third quarter of 2025 was $20.2 million, an increase of $5.4 million, or 37.0%, from $14.7 million in the third quarter of 2024[97]. - Net interest income for the nine months ended September 30, 2025, was $105.4 million, compared to $91.8 million for the same period in 2024, reflecting a significant increase[112]. - The net interest margin improved to 3.49% for the nine months ended September 30, 2025, compared to 2.99% for the same period in 2024[112]. Assets and Liabilities - As of September 30, 2025, the company reported total assets of $2.17 billion and total equity of $314.8 million[94]. - Total assets increased by $29.9 million, or 1.40%, to $2.17 billion as of September 30, 2025, primarily due to a $90.7 million increase in net loans[115]. - Total liabilities rose by $15.1 million, or 0.8%, to $1.86 billion, mainly due to a $121.5 million increase in total deposits[116]. - Total equity increased by $14.8 million, or 4.9%, to $314.8 million, attributed to retained earnings despite cash dividends and stock repurchases[117]. Loans and Deposits - Net loans increased by $90.7 million, or 4.9%, driven by growth in construction and commercial non-owner occupied loan portfolios[115]. - Total deposits increased by $121.5 million, or 7.5%, to $1.75 billion, with significant growth in money market balances[116]. - Loans receivable increased to $1.96 billion at September 30, 2025, from $1.87 billion at December 31, 2024, an increase of $92.0 million, or 4.9%[126]. - Money market deposits increased by $273.3 million, primarily due to a $218.3 million increase in the premier money market account balance[127]. Expenses and Provisions - The provision for credit losses for the three months ended September 30, 2025, was $0.4 million, compared to a recovery of $0.1 million for the same period in 2024, marking an increase of $0.5 million[98]. - The provision for credit losses for the nine months ended September 30, 2025, was $1.9 million, an increase of $1.4 million compared to $0.5 million for the same period in 2024[104]. - Non-interest expense increased by $0.8 million, or 12.6%, to $7.2 million for the three months ended September 30, 2025, compared to the same period in 2024[100]. - Non-interest expense for the nine months ended September 30, 2025, increased by $1.2 million, or 6.5%, to $20.4 million compared to the same period in 2024[106]. Cash Flow and Investments - Cash provided by operating activities was $25.1 million during the nine months ended September 30, 2025, compared to $26.6 million for the same period in the prior year[136]. - Cash used in investing activities was $91.6 million during the nine months ended September 30, 2025, compared to $52.3 million in the same period last year[137]. Legal Matters - The Company is involved in a legal matter where unit owners claim damages totaling approximately $1.7 million related to the Absecon Gardens Condominium project[150]. - The Company has a loan default case involving Voorhees Diner Corporation, with the original loan amount of $1.0 million increased to $1.4 million[151]. - The Company believes that no material losses are anticipated from various contingent liabilities and legal actions outstanding in the normal course of business[152]. Capitalization - The Company and the Bank were both considered "well capitalized" as of September 30, 2025[141]. - Estimated uninsured deposits increased to $881.8 million at September 30, 2025, from $642.7 million at December 31, 2024, an increase of $239.1 million, or 37.2%[128].

Financial Performance - Net income for Q3 2025 was $10.6 million, a 28.3% increase from Q2 2025[1] - Revenue for Q3 2025 reached $37.4 million, up 4.2% from Q2 2025[1] - Net interest income for Q3 2025 was $20.2 million, a 37.0% increase compared to Q3 2024[2] - Parke Bank's net income for Q3 2025 increased by 41.6% to $10.6 million, compared to $7.5 million in Q3 2024, representing a growth of $3.1 million[12] - The return on average assets improved to 1.99% for Q3 2025, compared to 1.49% for Q3 2024[20] Asset and Loan Growth - Total assets increased to $2.17 billion, a 1.4% rise since December 31, 2024[1] - Total loans grew to $1.93 billion, reflecting a 4.9% increase since December 31, 2024[1] - The outstanding loan balance increased by $92.0 million to $1.96 billion as of September 30, 2025, with new loan generation of $144 million during the nine months ended September 30, 2025[12] Deposit and Equity Changes - Total deposits rose to $1.75 billion, marking a 7.5% increase since December 31, 2024[1] - Total deposits rose to $1.75 billion as of September 30, 2025, an increase of $121.5 million or 7.5% from $1.63 billion at December 31, 2024[13] - Total equity increased to $314.8 million at September 30, 2025, a rise of $14.8 million or 4.9% from $300.1 million at December 31, 2024[13] Credit Losses and Non-Performing Loans - Provision for credit losses for Q3 2025 was $0.4 million, compared to a recovery of $0.1 million in Q3 2024[2] - Non-performing loans increased to $12.4 million as of September 30, 2025, up from $11.8 million as of December 31, 2024[12] - The allowance for credit losses was $33.9 million at September 30, 2025, with a ratio of 1.73% to total loans[11] - The allowance for credit losses on loans was $33.9 million, representing 1.73% of total loans as of September 30, 2025[21] Expenses and Efficiency - Non-interest income decreased to $0.85 million for Q3 2025, down 5.6% from Q3 2024[2] - Non-interest expense increased to $7.2 million for Q3 2025, a 12.6% rise compared to Q3 2024[2] - The efficiency ratio improved to 35.68% as of September 30, 2025, down from 41.37% a year earlier, indicating better cost management[12] Interest Income - Interest income for the nine months ended September 30, 2025, was $105.4 million, up from $91.8 million for the same period in 2024[19] Debt Management - Parke Bank repaid $30.0 million in subordinated debt, strengthening its balance sheet and reducing interest expenses[12]

Core Viewpoint - Parke Bancorp, Inc. (NASDAQ: PKBK) is currently trading at a discounted valuation compared to other regional banks and offers an above-average dividend yield, making it an attractive investment opportunity within the U.S. regional banking sector [1] Company Summary - Parke Bancorp, Inc. is identified as a regional bank with a valuation that is lower than its peers in the same sector [1] - The company provides a dividend yield that is above the average, which may appeal to income-focused investors [1]

Financial Performance - For the three months ended June 30, 2025, net income available to common shareholders increased by $1.8 million, or 28.3%, to $8.3 million compared to $6.5 million for the same period in 2024[97]. - For the six months ended June 30, 2025, net income available to common shareholders increased by $3.5 million, or 27.4%, to $16.1 million compared to $12.6 million for the same period in 2024[104]. Net Interest Income - Net interest income for the second quarter of 2025 was $17.9 million, an increase of $3.6 million, or 24.9%, from $14.3 million in the second quarter of 2024[98]. - Net interest income for the six months ended June 30, 2025, was $34.5 million, an increase of $6.1 million, or 21.6%, from $28.4 million in the same period of 2024[105]. - The interest rate spread improved to 2.46% for the three months ended June 30, 2025, compared to 1.95% for the same period in 2024[115]. Interest and Fees on Loans - Interest income increased by $4.8 million, or 16.0%, during the three months ended June 30, 2025, primarily due to a $4.0 million increase in interest and fees on loans[98]. Provision for Credit Losses - Provision for credit losses for the three months ended June 30, 2025, was $1.0 million, compared to $0.5 million for the same period in 2024, reflecting an increase of $0.5 million[99]. - Provision for credit losses for the six months ended June 30, 2025, was $1.6 million, compared to $0.7 million for the same period in 2024, reflecting an increase of $0.9 million[106]. Non-Interest Income and Expense - Non-interest income decreased by $0.4 million, to $0.8 million for the three months ended June 30, 2025, compared to $1.2 million for the same period in 2024[100]. - Non-interest income for the six months ended June 30, 2025, was $1.6 million, a decrease of $0.6 million compared to $2.3 million for the same period in 2024[107]. - Non-interest expense increased by $0.4 million, or 3.5%, to $13.2 million for the six months ended June 30, 2025, compared to the same period in 2024[108]. Assets and Liabilities - Total assets increased by $28.1 million, or 1.30%, to $2.17 billion as of June 30, 2025, compared to December 31, 2024[118]. - Total liabilities rose by $16.0 million, or 0.9%, to $1.86 billion, driven by a $62.4 million increase in total deposits, or 3.8%[119]. - Total equity increased by $12.1 million, or 4.0%, to $312.2 million, mainly due to retained earnings[120]. Loans and Deposits - Net loans increased by $66.6 million, or 3.6%, primarily due to growth in the commercial non-owner occupied and construction loan portfolios[118]. - Total deposits increased to $1.69 billion at June 30, 2025, from $1.63 billion at December 31, 2024, an increase of $62.4 million, or 3.8%[129]. - Loans receivable increased to $1.93 billion at June 30, 2025, from $1.87 billion at December 31, 2024, an increase of $66.6 million, or 3.6%[128]. Cash Flow - Cash provided by operating activities was $13.8 million during the six months ended June 30, 2025, compared to $17.2 million for the same period in the prior year[137]. - Cash used in investing activities was $64.2 million during the six months ended June 30, 2025, compared to $19.3 million in the same period last year[138]. - Cash provided by financing activities was $13.2 million during the six months ended June 30, 2025, compared to cash used in financing activities of $10.6 million in the same period last year[139]. Legal Matters - Management believes no material losses are anticipated from various contingent liabilities and legal actions[153]. - There are no material pending legal proceedings other than routine litigation incidental to the business[154].

Financial Performance - Net income for Q2 2025 was $8.3 million, a 6.5% increase from Q1 2025, and a 28.3% increase from Q2 2024[2] - Revenue for Q2 2025 reached $35.8 million, up 3.4% from Q1 2025[1] - The company reported a net income of $16.061 million for the six months ended June 30, 2025, compared to $12.606 million for the same period in 2024, representing a year-over-year increase of 27.5%[19] Asset and Loan Growth - Total assets increased to $2.17 billion, a 1.3% rise from December 31, 2024[10] - Total loans grew to $1.93 billion, reflecting a 3.6% increase since December 31, 2024[10] - Total deposits increased to $1.69 billion as of June 30, 2025, up $62.4 million or 3.8% from $1.63 billion at December 31, 2024, driven by a $199.6 million rise in money market deposits[13] Income and Efficiency Ratios - Net interest income for Q2 2025 was $17.9 million, a 24.9% increase compared to Q2 2024[2] - The efficiency ratio improved to 36.60% as of June 30, 2025, compared to 41.69% a year earlier[12] - The efficiency ratio decreased to 36.60% for the six months ended June 30, 2025, down from 41.69% for the same period in 2024, indicating improved operational efficiency[20] Credit Quality - Provision for credit losses was $1.0 million for Q2 2025, compared to $0.5 million for the same period in 2024[6] - Non-performing loans decreased to $11.2 million, representing 0.58% of total loans, down from $11.8 million at December 31, 2024[11] - The allowance for credit losses was $33.8 million, with a ratio of 1.75% to total loans as of June 30, 2025[11] - Non-accrual loans decreased to $11.202 million as of June 30, 2025, down from $11.782 million at December 31, 2024, indicating improved asset quality[21] Interest Income Management - Net interest income for the six months ended June 30, 2025, was $34.478 million, up from $28.366 million for the same period in 2024, reflecting a significant increase in interest income[19] - The company experienced a net interest margin of 3.32% for the six months ended June 30, 2025, compared to 3.00% for the same period in 2024, reflecting better interest income management[20] Borrowings - Total borrowings decreased to $143.4 million at June 30, 2025, down from $188.3 million at December 31, 2024, primarily due to the repayment of $45.0 million of FHLBNY term borrowings[13]

Financial Performance - For the first quarter of 2025, net income available to common shareholders increased by $1.6 million, or 26.5%, to $7.8 million compared to $6.1 million in the same period last year[90]. - Net interest income for the first quarter of 2025 was $16.6 million, an increase of $2.5 million, or 18.2%, from $14.1 million in the first quarter of 2024[91]. - Non-interest income decreased by $0.2 million to $0.8 million for the first quarter of 2025, primarily due to a decline in service fees on deposit accounts[93]. - Non-interest expense remained unchanged at $6.5 million for the first quarter of 2025 compared to the same period in 2024[94]. - The effective tax rate for the first quarter of 2025 was 24.5%, compared to 26.6% in the same period of 2024[94]. - Cash provided by operating activities was $7.0 million for the three months ended March 31, 2025, down from $8.4 million in the prior year[118]. Asset and Liability Management - Total assets as of March 31, 2025, were $2.14 billion, with total equity of $305.9 million[89]. - Total assets decreased by $0.4 million, or 0.02%, to $2.14 billion as of March 31, 2025, primarily due to a $12.5 million decrease in cash and cash equivalents[99]. - Total liabilities decreased by $6.3 million, or 0.3%, to $1.84 billion, mainly due to a $40.0 million reduction in FHLBNY borrowings[100]. - Total equity increased by $5.9 million, or 2.0%, to $305.9 million, primarily due to retained earnings, despite $2.1 million in cash dividends paid[101]. - Total deposits rose by $35.6 million, or 2.2%, to $1.67 billion, with significant increases in money market deposits[110]. - Cash and cash equivalents decreased by $12.5 million, or 5.6%, to $209.0 million, attributed to increased loans and decreased borrowings[102]. - Total borrowings decreased to $148.3 million, down from $188.3 million, primarily due to a $40.0 million reduction in FHLBNY advances[112]. Loan and Credit Quality - Interest income increased by $4.4 million, or 14.8%, primarily due to a $3.4 million increase in interest and fees on loans, attributed to higher loan balances and market interest rates[91]. - The provision for credit losses for the first quarter of 2025 was $0.6 million, up from $0.2 million in the same period of 2024, reflecting an increase in the commercial loan portfolio[92]. - The average yield on loans increased to 6.80% in the first quarter of 2025 from 6.30% in the same period of 2024[97]. - The net interest margin improved to 3.21% for the first quarter of 2025, up from 2.97% in the same period of 2024[97]. - Loans receivable increased by $15.0 million, or 0.8%, to $1.88 billion, driven by growth in commercial owner-occupied and non-owner-occupied portfolios[109]. - The allowance for credit losses is based on evaluations of loan and lease portfolios, with significant reliance on historical data and qualitative factors[127]. - The determination of the allowance for credit losses requires significant judgment and may lead to future earnings adjustments if actual outcomes differ from estimates[128]. Capital Adequacy - The Company and Parke Bank reported Tier 1 leverage ratios of 14.99% and 16.36%, respectively, as of March 31, 2025, indicating strong capital adequacy[124]. - The Company has maintained its status as "well capitalized" under federal banking regulations as of March 31, 2025[124]. - Total equity increased by $5.9 million to $319.3 million as of March 31, 2025, driven by net income of $7.8 million after dividends of $2.1 million[122]. Legal and Regulatory Matters - The Company is currently involved in a legal matter with Absecon Gardens Condominium Association, with claimed damages totaling approximately $1.7 million[131]. - Management believes that no material losses are anticipated from various contingent liabilities and legal actions outstanding[133]. - The Company has not experienced any changes in internal control over financial reporting that materially affect its operations during the last fiscal quarter[130]. - The Company’s accounting policies require management to make estimates and assumptions that could significantly impact reported financial results[125]. - The Company actively reviews its capital strategies to align with business risks and growth opportunities[121].

Core Viewpoint - Parke Bancorp, Inc. (NASDAQ: PKBK) has shown resilience in its stock performance, quickly recovering from losses associated with the announcement of "reciprocal" tariffs earlier this month, with a minimal decline of only 0.6% from the market close on April 2 [1] Group 1 - The stock of Parke Bancorp, Inc. has reversed most of its losses following the tariff announcement [1] - As of the latest market close, the stock was down just 0.6% compared to its previous close [1]

Financial Performance - Net income for Q1 2025 was $7.8 million, a 5.12% increase from Q4 2024 and a 26.5% increase from Q1 2024[1][2][13]. - Revenue for Q1 2025 reached $34.7 million, up 0.6% compared to Q4 2024[1]. - Net income attributable to the company for Q1 2025 was $7,778,000, representing a 26.4% increase compared to $6,151,000 in Q1 2024[21]. - Earnings per common share increased to $0.66 in Q1 2025 from $0.51 in Q1 2024, reflecting a growth of 29.4%[21]. - Return on average assets improved to 1.48% in Q1 2025 from 1.27% in Q1 2024[22]. - Return on average common equity rose to 10.36% in Q1 2025, up from 8.60% in Q1 2024[22]. Income and Expenses - Net interest income increased by $2.6 million, or 18.2%, to $16.6 million for Q1 2025 compared to Q1 2024[2][4]. - Total interest income for Q1 2025 was $33,846,000, an increase of 14.4% from $29,477,000 in Q1 2024[21]. - Non-interest income decreased by $0.2 million, or 22.7%, to $0.8 million for Q1 2025 compared to Q1 2024[2][7]. - Total non-interest income for Q1 2025 was $821,000, a decrease from $1,062,000 in Q1 2024[21]. - Net interest income after provision for credit losses was $16,017,000 in Q1 2025, compared to $13,850,000 in Q1 2024, marking a 15.7% increase[21]. Asset and Loan Management - Total assets remained flat at $2.14 billion as of March 31, 2025, compared to December 31, 2024[1][10]. - Total loans increased by $15.0 million, or 0.8%, to $1.88 billion from December 31, 2024[1][10]. - Total deposits rose to $1.67 billion, an increase of $35.6 million or 2.2% from December 31, 2024[1][15]. - The allowance for credit losses was $33.1 million, representing 1.76% of total loans as of March 31, 2025[11][12]. - The allowance for credit losses on loans increased to $33,091,000 as of March 31, 2025, compared to $32,573,000 at December 31, 2024[23]. - Non-accrual loans decreased to $11,122,000 as of March 31, 2025, down from $11,782,000 at December 31, 2024[23]. Efficiency and Management - The efficiency ratio improved to 37.1% in Q1 2025 from 43.2% in Q1 2024[13]. - The efficiency ratio improved to 37.51% in Q1 2025, down from 43.23% in Q1 2024, indicating better cost management[22]. - The provision for credit losses was $0.6 million for Q1 2025, up from $0.2 million in Q1 2024[2][6].

Financial Performance - Net income available to common shareholders for 2024 was $27.5 million, a decrease of 3.3% from $28.4 million in 2023[151]. - Net income attributable to the company decreased to $27,512 thousand in 2024 from $28,462 thousand in 2023, a decline of 3.3%[221]. - Comprehensive income attributable to the company was $27,579 thousand in 2024, compared to $28,584 thousand in 2023, a decrease of 3.5%[222]. - Earnings per common share (basic) decreased to $2.30 in 2024 from $2.38 in 2023, a decrease of 3.4%[221]. - Diluted earnings per common share also decreased to $2.27 in 2024 from $2.35 in 2023, a decline of 3.4%[279]. Income and Expenses - Net interest income decreased by $5.5 million, or 8.6%, to $58.7 million in 2024, primarily due to an increase in interest expense[152]. - Interest income for 2024 increased to $125.1 million, an increase of 11.0% from $112.7 million in 2023[152]. - Interest expense rose to $66.4 million in 2024, an increase of 36.9% from $48.5 million in 2023[152]. - Non-interest income decreased by $2.4 million to $4.3 million in 2024, primarily due to a decline in fee income related to cannabis business deposits[164]. - Total non-interest expense decreased significantly to $25,984 thousand in 2024 from $35,267 thousand in 2023, a reduction of 26.3%[221]. Assets and Liabilities - Total assets as of December 31, 2024, were $2.14 billion, an increase of 5.9% compared to the previous year[149]. - Total loans outstanding rose by $80.8 million, or 4.5%, to $1.87 billion, driven by a $71.4 million increase in residential multi-family loans and an $18.7 million increase in commercial owner-occupied loans[175]. - Total deposits increased by $78.2 million, or 5.0%, to $1.63 billion, with deposits from the cannabis industry rising to $151.9 million from $96.7 million[170][177]. - Cash and cash equivalents rose by $41.2 million, or 22.8%, to $221.5 million, attributed to increased deposits and borrowings[173]. - Total equity increased by $15.8 million, or 5.5%, to $300.1 million as of December 31, 2024, from $284.3 million in 2023[171][179]. Credit Quality - The provision for credit losses was $0.7 million in 2024, compared to a recovery of $2.1 million in 2023[160]. - The allowance for credit losses increased by $0.4 million to $32.6 million, representing 1.38% of total loans[176]. - Nonperforming loans in the residential - 1 to 4 family segment totaled $2,883,000, with $447,880,000 in total performing loans[303]. - The total past due loans for all categories combined increased to $13,225 thousand in 2024 from $11,144 thousand in 2023, marking an increase of 18.7%[294]. - The charge-offs for the year ended December 31, 2024, were recorded at $(21) thousand, indicating a stable performance compared to previous periods[296]. Shareholder Returns - The company returned $8.6 million to common shareholders through cash dividends and repurchased 200,000 shares at a cost of $4.3 million during the fiscal year[149]. - The company’s cash dividends for 2024 were $8,602 thousand, slightly down from $8,629 thousand in 2023[225]. - The Company paid a total of $8.6 million in common stock cash dividends for both 2024 and 2023, maintaining a quarterly dividend of $0.18 per share[329]. - During 2024, the Company repurchased 200,000 shares of its common stock for $4.3 million at an average price of $21.28 per share, with no repurchases in 2023[331]. Borrowings and Interest Rates - Total borrowings increased by $20.2 million to $188.3 million, primarily due to a $20.0 million increase in FHLBNY advances[178]. - The weighted average interest rate on Federal Home Loan Bank advances was 4.83% for amounts less than one year as of December 31, 2024, compared to 5.61% in 2023[317]. - The total interest expense on deposits increased to $57.31 million in 2024 from $41.26 million in 2023, representing a rise of approximately 38.9%[316]. Investment Securities - Investment securities decreased by $1.6 million, or 9.9%, to $14.8 million, mainly due to pay downs[174]. - The Company’s investment securities included $6.005 million in available-for-sale residential mortgage-backed securities as of December 31, 2024, down from $7.639 million in 2023, reflecting a decrease of approximately 21.4%[285]. - The total held-to-maturity securities amounted to $9.209 million as of December 31, 2024, compared to $9.292 million in 2023, showing a slight decrease of about 0.9%[285]. Off-Balance Sheet Arrangements - The company’s off-balance sheet arrangements include commitments to extend credit and standby letters of credit, primarily designed to meet customer financial needs[193]. - The company believes that off-balance sheet risk is not material to its results of operations or financial condition[197]. - Unused commitments to extend credit were approximately $122.5 million as of December 31, 2024, compared to $93.8 million in the previous year[197].

[Financial Performance Summary](index=1&type=section&id=PARKE%20BANCORP%2C%20INC.%20ANNOUNCES%20FOURTH%20QUARTER%202024%20EARNINGS) A comprehensive overview of Parke Bancorp's financial results for the fourth quarter and full fiscal year 2024 [Q4 2024 Performance](index=1&type=section&id=Q4%202024%20Performance) Parke Bancorp's Q4 2024 net income decreased by 9.5% to $7.4 million, driven by higher credit loss provisions and expenses Q4 2024 vs Q4 2023 Key Financials | Metric | Q4 2024 | Q4 2023 | Change | | :--- | :--- | :--- | :--- | | Net Income to Common Shareholders | $7.4 million | $8.2 million | -9.5% | | Diluted EPS | $0.61 | $0.67 | -9.0% | | Net Interest Income | $15.6 million | $15.5 million | +0.7% | - The decrease in net income was primarily attributed to three factors: an increased provision for credit losses, a **23.1%** decrease in non-interest income, and a **9.0%** increase in non-interest expense[2](index=2&type=chunk)[3](index=3&type=chunk) [Full Year 2024 Performance](index=2&type=section&id=Full%20Year%202024%20Performance) Full year 2024 net income decreased by 3.3% to $27.5 million, impacted by lower net interest income and higher credit loss provisions Full Year 2024 vs Full Year 2023 Key Financials | Metric | FY 2024 | FY 2023 | Change | | :--- | :--- | :--- | :--- | | Net Income to Common Shareholders | $27.5 million | $28.4 million | -3.3% | | Diluted EPS | $2.27 | $2.35 | -3.4% | | Net Interest Income | $58.7 million | $64.2 million | -8.6% | - The primary drivers for the full-year net income decrease were lower net interest income, an increased provision for credit losses, and reduced non-interest income[4](index=4&type=chunk) - A significant factor offsetting the decline was a **$9.3 million** (**26.3%**) decrease in non-interest expense, mainly because 2023's results included a one-time **$9.5 million** contingent loss[9](index=9&type=chunk) [Analysis of Financial Results](index=3&type=section&id=Analysis%20of%20Financial%20Results) Detailed analysis of key financial components including net interest income, credit losses, and non-interest items [Net Interest Income](index=3&type=section&id=Net%20Interest%20Income) Full-year net interest income declined by 8.6% to $58.7 million due to higher interest expenses outpacing income growth - Full-year interest income rose by **$12.4 million**, primarily due to an **$11.8 million** increase in interest and fees on loans from higher average balances and rates[5](index=5&type=chunk) - Full-year interest expense surged by **$17.9 million**, attributed to higher market interest rates and a change in deposit mix, with a reduction in non-interest bearing deposits and an increase in interest-bearing ones[6](index=6&type=chunk) [Provision for Credit Losses](index=3&type=section&id=Provision%20for%20Credit%20Losses) Full-year provision for credit losses increased by $2.8 million to $0.7 million, driven by higher loan balances - For the full year, the provision for credit losses increased by **$2.8 million** compared to the prior year, mainly due to higher outstanding loan balances[7](index=7&type=chunk)[9](index=9&type=chunk) [Non-Interest Income & Expense](index=3&type=section&id=Non-Interest%20Income%20%26%20Expense) Non-interest income decreased by 35.7% to $4.3 million, while non-interest expense fell by 26.3% due to a prior-year one-time loss - Full-year non-interest income decreased by **$2.4 million**, primarily driven by a **$2.5 million** drop in service fees on deposit accounts, which was attributed to a decrease in fees from cannabis-related business accounts[8](index=8&type=chunk)[9](index=9&type=chunk) - Full-year non-interest expense decreased by **$9.3 million**, largely due to the recognition of a one-time **$9.5 million** contingent loss in 2023[9](index=9&type=chunk)[11](index=11&type=chunk) [Income Tax Expense](index=5&type=section&id=Income%20Tax%20Expense) Full-year income tax expense decreased by $0.4 million, with the effective tax rate slightly lower at 24.2% Effective Tax Rate Comparison | Period | 2024 | 2023 | | :--- | :--- | :--- | | Q4 | 23.9% | 26.8% | | Full Year | 24.2% | 24.5% | [Financial Condition (Balance Sheet Analysis)](index=5&type=section&id=December%2031%2C%202024%20discussion%20of%20financial%20condition) An overview of the company's balance sheet, focusing on assets, asset quality, liabilities, and equity [Assets](index=5&type=section&id=Assets) Total assets grew by 5.9% to $2.14 billion, driven by a 4.5% increase in gross loans to $1.87 billion Asset Growth (Year-End 2024 vs 2023) | Metric | Dec 31, 2024 | Dec 31, 2023 | Change | | :--- | :--- | :--- | :--- | | Total Assets | $2.14 billion | $2.02 billion | +5.9% | | Gross Loans | $1.87 billion | $1.79 billion | +4.5% | | Cash & Cash Equivalents | $221.5 million | $180.4 million | +22.8% | - Loan growth was driven by a **$71.5 million** increase in the multi-family portfolio and an **$18.2 million** increase in the CRE owner-occupied portfolio, partially offset by a **$17.9 million** decrease in the construction portfolio[13](index=13&type=chunk) [Asset Quality](index=5&type=section&id=Asset%20Quality) Asset quality deteriorated with nonperforming loans increasing to $11.8 million, though past due loans decreased - Nonperforming loans increased to **$11.8 million** (**0.63%** of total loans) at year-end 2024, up from **$7.3 million** at year-end 2023[13](index=13&type=chunk) Allowance for Credit Losses Ratios | Ratio | Dec 31, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | Allowance / Total Loans | 1.74% | 1.80% | | Allowance / Non-performing Loans | 276.5% | 442.5% | - Loans past due 30 to 89 days decreased by **$2.5 million** from December 31, 2023[13](index=13&type=chunk) [Liabilities & Equity](index=5&type=section&id=Liabilities%20%26%20Equity) Total deposits grew by 5.0% to $1.63 billion, and total equity increased by 5.5% to $300.1 million - Total deposits increased by **$78.2 million** (**5.0%**), with growth in brokered time deposits and money market accounts offsetting a **$48.2 million** decrease in non-interest bearing demand deposits[13](index=13&type=chunk) - Deposits from cannabis-related businesses increased by **$55.2 million** to **$151.9 million** at year-end 2024[13](index=13&type=chunk) - Total equity grew by **$15.8 million** to **$300.1 million**, driven by retained earnings, partially offset by **$8.6 million** in cash dividends and **$4.3 million** in common stock repurchases[16](index=16&type=chunk) [CEO Outlook and Commentary](index=7&type=section&id=CEO%20outlook%20and%20commentary) The CEO highlighted strong earnings, tight expense control, and solid asset quality, positioning the bank for cautious growth - The CEO noted that higher interest expenses negatively affected net interest income but was pleased with strong overall earnings in 2024[14](index=14&type=chunk) - The company maintained tight expense controls, improving its efficiency ratio to nearly **41%**, and kept a strong focus on asset quality with a credit loss reserve of **1.74%**[14](index=14&type=chunk) - With total equity exceeding **$300 million**, the bank is positioned to cautiously explore new business opportunities, noting optimism in the business and real estate industries, especially new home construction[14](index=14&type=chunk) [Financial Supplement](index=9&type=section&id=Financial%20Supplement) Supplementary financial tables providing detailed balance sheet, income statement, operating ratios, and asset quality data [Condensed Consolidated Balance Sheets](index=9&type=section&id=Table%201%3A%20Condensed%20Consolidated%20Balance%20Sheets%20(Unaudited)) Snapshot of the company's financial position, detailing assets, liabilities, and equity as of year-end 2024 and 2023 Condensed Consolidated Balance Sheets (in thousands) | | Dec 31, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $221,527 | $180,376 | | Net loans | $1,835,580 | $1,755,208 | | **Total assets** | **$2,142,236** | **$2,023,500** | | **Liabilities and Equity** | | | | Total deposits | $1,631,050 | $1,552,827 | | Total liabilities | $1,842,163 | $1,739,183 | | Total shareholders' equity | $300,073 | $284,317 | | **Total liabilities and shareholders' equity** | **$2,142,236** | **$2,023,500** | [Consolidated Income Statements](index=11&type=section&id=Table%202%3A%20Consolidated%20Income%20Statements%20(Unaudited)) Detailed revenues, expenses, net income, and EPS for Q4 and full year periods ending December 31, 2024 and 2023 Consolidated Income Statements Highlights (in thousands) | | Three Months Ended Dec 31 | Twelve Months Ended Dec 31 | | :--- | :--- | :--- | | | **2024** | **2023** | **2024** | **2023** | | Net interest income | $15,619 | $15,515 | $58,708 | $64,214 | | Provision for (recovery of) credit losses | $182 | $(451) | $728 | $(2,051) | | Total non-interest income | $1,138 | $1,480 | $4,301 | $6,692 | | Total non-interest expense | $6,850 | $6,287 | $25,984 | $35,267 | | Net income available to common shareholders | $7,393 | $8,167 | $27,492 | $28,436 | [Operating Ratios](index=13&type=section&id=Table%203%3A%20Operating%20Ratios) Key performance metrics measuring profitability and efficiency for Q4 and full year periods ending December 31, 2024 and 2023 Key Operating Ratios | | Three Months Ended Dec 31 | Twelve Months Ended Dec 31 | | :--- | :--- | :--- | | | **2024** | **2023** | **2024** | **2023** | | Return on average assets | 1.41% | 1.64% | 1.38% | 1.45% | | Return on average common equity | 9.82% | 11.50% | 9.36% | 10.21% | | Net interest margin | 3.02% | 3.17% | 3.00% | 3.34% | | Efficiency ratio | 40.88% | 36.99% | 41.24% | 48.34% | [Asset Quality Data](index=13&type=section&id=Table%204%3A%20Asset%20Quality%20Data) Data on asset quality, including allowance for credit losses and non-accrual loans, as of year-end 2024 and 2023 Asset Quality Data (in thousands) | | Dec 31, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | Allowance for credit losses | $32,573 | $32,132 | | Allowance for credit losses to total loans | 1.74% | 1.80% | | Non-accrual loans | $11,782 | $7,261 |