Financial Performance - For the three months ended June 30, 2024, total interest and dividend income was $13,217,000, a decrease of 13.5% from $15,309,000 in the same period of 2023[6]. - Net interest income for the same period was $5,023,000, down 34.9% from $7,713,000 year-over-year[6]. - The net loss for the three months ended June 30, 2024, was $3,081,000, compared to a net loss of $615,000 in the same period of 2023[7]. - Basic loss per share for the three months ended June 30, 2024, was $0.77, compared to $0.16 in the same period of 2023[6]. - The total comprehensive loss for the three months ended June 30, 2024, was $3,151,000, compared to $2,256,000 in the same period of 2023[7]. - For the six months ended June 30, 2024, the net loss was $3,380,000 compared to a net loss of $1,314,000 for the same period in 2023, representing a 157% increase in losses year-over-year[17]. - Total comprehensive loss for the first half of 2024 was $3,921,000, which includes an unrealized holding loss on available-for-sale securities of $541,000[14]. Credit Losses and Provisions - The provision for credit losses increased to $3,092,000 for the three months ended June 30, 2024, compared to $1,325,000 in the same period of 2023[6]. - The provision for credit losses for the first half of 2024 was $3,750,000, slightly up from $3,545,000 in the same period of 2023[17]. - The total allowance for credit losses is $14,989,000, with $7,958,000 for individually evaluated loans and $9,272,000 for collectively evaluated loans[63]. - The total ACL for credit losses increased to $14,989,000 as of June 30, 2024, compared to $24,098,000 as of June 30, 2023, reflecting a decrease of approximately 37.9% year-over-year[61]. - The charge-offs for the six months ended June 30, 2024, totaled $5,365,000, indicating a significant increase in losses compared to previous periods[61]. Loan Portfolio and Performance - As of June 30, 2024, total loans receivable, net, amounted to $761.3 million, a decrease of 8.6% from $832.9 million as of December 31, 2023[37]. - The commercial real estate loan portfolio was $458.6 million as of June 30, 2024, down from $472.1 million at the end of 2023, reflecting a decline of 2.3%[37]. - Residential real estate loans decreased to $99.4 million from $106.8 million, a decline of 6.5%[37]. - The company’s construction loans outstanding were $3.8 million as of June 30, 2024, down from $4.3 million at the end of 2023, a decrease of 11.6%[46]. - The total loans receivable gross included $716.854 million in performing loans, $11.308 million in special mention, and $40.948 million in substandard loans[76]. Deposits and Cash Flow - The company experienced a decrease in deposits of $39,409,000 in the first half of 2024, contrasting with an increase of $2,933,000 in 2023[17]. - As of June 30, 2024, total deposits held by Patriot National Bancorp amounted to $800.9 million, a decrease of 4.67% from $840.3 million on December 31, 2023[101]. - Cash provided by operating activities for the first half of 2024 was $7,846,000, up from $3,796,000 in the same period of 2023, indicating a 106% increase[17]. - The company reported a net increase in cash, cash equivalents, and restricted cash of $27,116,000 for the first half of 2024, compared to an increase of $32,316,000 in 2023[17]. Securities and Investments - As of June 30, 2024, total available-for-sale securities amounted to $86.667 million, with gross unrealized losses of $21.474 million, reflecting a decline of 19.9% from the amortized cost[28]. - The amortized cost of U.S. Government agency and mortgage-backed securities was $79.854 million, with unrealized losses of $15.567 million as of June 30, 2024[28]. - The company does not intend to sell the debt securities and believes it is more likely than not that they will not be required to sell them before recovery of their amortized cost[31]. Capital and Regulatory Compliance - As of June 30, 2024, the total capital to risk-weighted assets ratio for Patriot National Bancorp, Inc. was 9.84%, while the Tier 1 capital ratio was 7.66%[128]. - The common equity tier 1 capital ratio for Patriot National Bancorp, Inc. was 6.72% as of June 30, 2024, compared to 10.20% for Patriot Bank, N.A.[128]. - The Bank was notified by the OCC of individual minimum capital ratios, requiring a common equity tier 1 capital ratio of 10.00% and a total risk-based capital ratio of 11.50%[129]. Interest Income and Expense - Total interest expense increased to $8.2 million for the three months ended June 30, 2024, up by $598,000 from $7.6 million in the prior year[202]. - Net interest income decreased by $2.7 million, from $7.7 million in Q2 2023 to $5.0 million in Q2 2024, attributed to lower loan balances and narrower net interest margins[202]. - The total interest income recognized for the six months ended June 30, 2024, was $35.745 million, compared to $21.609 million for the same period in 2023, reflecting an increase of approximately 65.3%[88].

Financial Performance - Total interest and dividend income for Q1 2024 was $14,001,000, an increase of 2.6% from $13,646,000 in Q1 2023[14] - Net interest income after provision for credit losses decreased to $4,746,000 in Q1 2024, down 18.1% from $5,793,000 in Q1 2023[14] - Non-interest income surged to $2,247,000 in Q1 2024, a significant increase of 169.5% compared to $835,000 in Q1 2023[14] - The net loss for Q1 2024 was $299,000, an improvement from a net loss of $699,000 in Q1 2023[14] - Basic loss per share improved to $0.08 in Q1 2024 from $0.18 in Q1 2023[14] - The company reported a comprehensive loss of $770,000 for Q1 2024, compared to a comprehensive income of $548,000 in Q1 2023[15] - For the three months ended March 31, 2024, the company reported a net loss attributable to common shareholders of $299,000, resulting in a basic and diluted loss per share of $0.08, compared to a net loss of $699,000 and a loss per share of $0.18 for the same period in 2023[109] Cash and Liquidity - Cash, cash equivalents, and restricted cash at the end of Q1 2024 totaled $92,775,000, up from $60,252,000 at the end of Q1 2023[19] - Net cash provided by operating activities was $1,799,000 in Q1 2024, compared to a net cash used of $212,000 in Q1 2023[19] - Total assets decreased by $20.2 million to $1.07 billion as of March 31, 2024, primarily due to a $38.5 million decline in loans receivable[159] - Cash, cash equivalents, and restricted cash increased from $66.5 million at December 31, 2023, to $92.8 million at March 31, 2024, reflecting a strategy to enhance balance sheet liquidity[160] Loans and Credit Quality - As of March 31, 2024, total loans receivable, net, amounted to $796.5 million, a decrease from $832.9 million as of December 31, 2023, representing a decline of approximately 4.3%[39] - The allowance for loan and lease losses decreased to $13.8 million as of March 31, 2024, from $15.9 million as of December 31, 2023, indicating a reduction of approximately 13.5%[39] - The total loans receivable, gross, was $810,323,000 as of March 31, 2024, compared to $848,859,000 at December 31, 2023[65] - The total allowance for credit losses decreased to $13,777,000 as of March 31, 2024, from $15,925,000 at December 31, 2023[63] - The total past due loans as of March 31, 2024, amounted to $7.735 million, with $783.509 million classified as current[75] - The total performing loans as of March 31, 2024, were $791.244 million, with $19.079 million classified as non-performing[75] - Nonperforming assets increased to $22.4 million as of March 31, 2024, with a nonperforming assets to total assets ratio of 2.09%[168] Deposits and Borrowings - Total deposits increased to $859,724,000 as of March 31, 2024, compared to $840,311,000 as of December 31, 2023[96] - Interest-bearing deposits totaled $750,459,000 as of March 31, 2024, up from $730,255,000 at the end of 2023[96] - Total borrowings decreased from $201.1 million at December 31, 2023, to $161.1 million as of March 31, 2024[176] - FHLB-B advances decreased from $101.0 million at December 31, 2023, to $61.0 million at March 31, 2024[178] Interest Income and Expense - Total interest expense for the three months ended March 31, 2024, was $8.6 million, which increased by $3.0 million from $5.6 million in the same period of 2023[208] - Net interest income decreased to $5.4 million for the three months ended March 31, 2024, down from $8.0 million in the same period of 2023, reflecting a lower loan balance and narrower net interest margin[208] - The net interest margin was 2.20% for the three months ended March 31, 2024, compared to 3.29% for the same period in 2023, primarily due to increased deposit costs and a decline in loan balances[209] Capital Ratios - As of March 31, 2024, the Total Capital ratio for Patriot National Bancorp, Inc. was 9.95%, while Patriot Bank, N.A. reported a ratio of 11.26%[121] - The Tier 1 Capital ratio for Patriot National Bancorp, Inc. was 7.94% as of March 31, 2024, compared to 10.40% for Patriot Bank, N.A.[121] - The Common Equity Tier 1 (CET1) Capital ratio for Patriot National Bancorp, Inc. was 7.03% as of March 31, 2024, while Patriot Bank, N.A. reported a ratio of 10.40%[121] - The Tier 1 Leverage Capital ratio for Patriot National Bancorp, Inc. was 6.53% as of March 31, 2024, compared to 8.55% for Patriot Bank, N.A.[121] Risk Management - The company has established a risk management strategy involving interest rate swaps with commercial lending customers to minimize net risk exposure[98] - The Company’s commercial and industrial loans are subject to risks including cash flow issues and economic downturns[58] - The estimated credit losses for pooled loans are calculated using a model that incorporates probability of default and loss given default[57] Accounting and Regulatory Changes - The company does not expect the adoption of ASU 2023-06 to impact its financial condition or results of operations but may change certain disclosures[27] - The Company adopted the CECL methodology for estimating expected credit losses starting January 1, 2023, impacting the ACL calculations[56] - The company plans to monitor SEC actions regarding recently issued accounting standards and will prepare for their adoption accordingly[27]

Credit Losses and Allowances - The Company's allowance for credit losses totaled $15.9 million as of December 31, 2023, consisting of $11.7 million for collectively evaluated loans and $4.2 million for individually evaluated loans[211]. - The allowance for credit losses is influenced by various economic indicators, including GDP and unemployment rates[212]. - The allowance for credit losses increased to $15.925 million in 2023 from $10.310 million in 2022, indicating a more cautious approach to credit risk[331]. - The provision for credit losses rose to $7,429 thousand in 2023, compared to $1,885 thousand in 2022, indicating a significant increase in expected credit losses[226]. - The allowance for credit losses may increase due to a decline in loan portfolio performance and higher incurred losses[365]. - The allowance for credit losses on unfunded lending commitments was $271,000 as of December 31, 2023[355]. - The total allowance for credit losses (ACL) increased to $23.3 million post-ASC 326 adoption from $10.3 million pre-adoption, reflecting a significant rise in reserves[260]. - The Company evaluates loans using a probability of default/loss given default (PD/LGD) method, which forecasts expected credit losses over the remaining life of the portfolio[263]. - The Company employs a risk rating system to assess the credit quality of its loan portfolio, with risk ratings reviewed and adjusted as necessary[361]. - The total charge-offs for the year ended December 31, 2023, amount to $(18,417,000)[357]. - The total recorded investment in individually evaluated loans was $17,133,000, with a principal outstanding of $22,535,000 and an allowance of $4,205,000[376]. Financial Performance - The company reported a net loss of $4,179 thousand in 2023, compared to a net income of $6,161 thousand in 2022, indicating a significant downturn[226]. - Net interest income decreased to $28,500 thousand in 2023 from $33,259 thousand in 2022, a decline of about 14.3%[226]. - Total assets increased to $1,093,425 thousand in 2023, up from $1,043,359 thousand in 2022, representing a growth of approximately 4.8%[223]. - Total deposits decreased to $840,311 thousand in 2023, down from $860,446 thousand in 2022, reflecting a reduction of approximately 2.5%[223]. - Interest expense surged to $30,457 thousand in 2023, up from $10,753 thousand in 2022, marking an increase of about 183%[226]. - Non-interest income increased to $6,005 thousand in 2023, up from $3,605 thousand in 2022, representing a growth of approximately 66.7%[226]. - The accumulated deficit increased to $47,026 thousand in 2023 from $31,337 thousand in 2022, reflecting a worsening financial position[223]. - The total shareholders' equity decreased to $44,383 thousand in 2023, down from $59,583 thousand in 2022, a decline of approximately 25.4%[223]. - Cash flows from operating activities resulted in a net cash used of $10,715,000 in 2023, a decrease from net cash provided of $7,036,000 in 2022[232]. - Cash paid for interest increased to $29,631,000 in 2023 from $10,472,000 in 2022, indicating higher borrowing costs[233]. Interest Rate Risk Management - Management's interest income simulations indicate that changes in interest rates can significantly affect net interest income, with quarterly simulations presented to the Asset and Liability Committee[193]. - The Management Asset and Liability Committee monitors interest rate risk to maximize net interest income while maintaining acceptable risk levels[191]. - The Company’s strategy includes originating variable rate loans and purchasing short-term investments to manage interest rate risk[190]. - The estimated net interest income under a +200 basis points interest rate scenario is projected to decrease by 5.10% to $107,524 thousand as of December 31, 2023[196]. - The estimated net portfolio value under a -200 basis points interest rate scenario is projected to decrease by 5.81% to $106,718 thousand as of December 31, 2023[196]. Goodwill and Intangible Assets - The Company recognized a goodwill impairment of $1.1 million and had no goodwill balance as of December 31, 2023[219]. - Patriot evaluates goodwill for impairment annually, with the last assessment conducted on October 31, and considers multiple valuation techniques[286]. - The company recorded an intangible asset impairment of $1,107 thousand in 2023, which was not present in 2022[226]. Regulatory and Accounting Changes - The Company adopted ASC 326 on January 1, 2023, presenting accrued interest receivable balances separately on the Consolidated Balance Sheet and fully reserving uncollectible accrued interest receivable[271]. - The Company recorded a net reduction of retained earnings of $11.5 million upon adopting ASC 326, which includes an increase in credit-related reserves of $13.0 million and an unfunded commitment reserve of $2.7 million[259]. - The Company adopted ASU 2022-02 effective January 1, 2023, which eliminated the accounting guidance for troubled debt restructurings (TDRs) while enhancing disclosure requirements[270]. - The adoption of ASU 2022-02 did not have a material impact on the Company's Consolidated Financial Statements[314]. - The Company does not expect the adoption of ASU 2023-06 to impact its financial condition but may change certain disclosures[317]. - The Company will adopt ASU 2023-09 for annual periods beginning January 1, 2025, without expecting a material impact on its Consolidated Financial Statements[318]. Loan Portfolio and Performance - The gross loans receivable total $848,859,000 as of December 31, 2023, compared to $848,316,000 in 2022[359]. - The commercial real estate loan portfolio increased to $472.093 million in 2023, up from $437.443 million in 2022[331]. - The company has not emphasized originating consumer loans, focusing instead on higher-yielding loans[338]. - The maximum loan-to-value for commercial real estate loans is limited to 75% of the market value of the underlying collateral[332]. - The company does not engage in subprime lending practices, focusing on borrowers with stronger credit histories[340]. - The loan portfolio aging analysis indicated that as of December 31, 2023, total performing loans were $830.732 million, with non-performing loans at $18.127 million[369]. - The company is monitoring the performance of its loan portfolio closely, with a focus on addressing identified weaknesses in substandard assets[366]. - The commercial real estate segment reported pass loans of $452.841 million, while special mention and substandard loans were $6.482 million and $12.770 million, respectively[367]. - The residential real estate segment had total loans of $106.783 million, all classified as pass loans[367]. - The consumer and other segment reported pass loans of $98.711 million, with substandard loans amounting to $977 thousand[367]. - The total amount of SBA loans held for investment was $30.0 million in 2023, down from $32.5 million in 2022[346]. - The total amount of SBA loans held for sale increased from $5.2 million in 2022 to $9.9 million in 2023, with $3.5 million in commercial and industrial loans and $6.4 million in commercial real estate loans[381].

Financial Performance - Total interest and dividend income for Q3 2023 was $15,070,000, an increase of 25.2% from $12,039,000 in Q3 2022[14]. - Net interest income after provision for credit losses decreased to $1,837,000 in Q3 2023 from $9,043,000 in Q3 2022, reflecting a decline of 79.7%[14]. - The net loss for Q3 2023 was $3,770,000, compared to a net income of $2,326,000 in Q3 2022[16]. - Basic and diluted loss per share for Q3 2023 was $0.95, compared to earnings per share of $0.59 in Q3 2022[14]. - Comprehensive loss for Q3 2023 was $6,468,000, compared to a comprehensive loss of $1,820,000 in Q3 2022[16]. - For the nine months ended September 30, 2023, Patriot National Bancorp reported a net loss of $5,084,000 compared to a net income of $4,391,000 in the same period of 2022[21]. - The company reported a significant increase in the allowance for loan losses from $10,310,000 as of December 31, 2022, to $25,668,000[85]. - The company reported a net loss of $3.8 million for Q3 2023, compared to a net income of $2.3 million in Q3 2022, resulting in a basic and diluted loss per share of $0.95[177]. Credit Losses and Provisions - Provision for credit losses increased significantly to $4,688,000 in Q3 2023 compared to $200,000 in Q3 2022[14]. - The provision for credit losses significantly increased to $8,233,000 in 2023 from $475,000 in 2022, indicating a substantial rise in expected credit losses[21]. - The allowance for credit losses rose to $25.7 million from $10.3 million, indicating a significant increase of 149.5%[57]. - The allowance for credit losses on unfunded loan commitments was $1.4 million at September 30, 2023[81]. - The Company’s ACL for credit losses on loans was $25.7 million as of September 30, 2023, compared to $9.9 million for the same period in 2022[82]. - The total allowance for credit losses was $25,668,000, with $13,360,000 individually evaluated for impairment and $14,432,000 collectively evaluated[85]. - The elevated provision for credit losses was $8.2 million for the nine months ended September 30, 2023, significantly higher than the $475,000 provision recorded for the first half of 2022[179]. Assets and Liabilities - Total assets increased by $93.4 million to $1.1 billion as of September 30, 2023, primarily due to increases in cash of $40.4 million and loans receivable of $41.6 million[180]. - Cash and cash equivalents rose from $38.5 million at December 31, 2022, to $78.9 million at September 30, 2023, reflecting a strategy to enhance balance sheet liquidity amid banking sector uncertainties[181]. - The company’s total financial liabilities are estimated at $1,084,125,000 as of September 30, 2023, compared to $976,427,000 at the end of 2022, reflecting an increase of about 11%[161]. - The total commitments to extend credit as of September 30, 2023, were $134,512,000, compared to $154,307,000 as of December 31, 2022[135]. Deposits and Borrowings - As of September 30, 2023, total deposits amounted to $837.0 million, a decrease from $860.4 million as of December 31, 2022, reflecting a decline of approximately 2.5%[115]. - Non-interest bearing deposits decreased to $136.1 million as of September 30, 2023, from $269.6 million at December 31, 2022, a decline of approximately 49.5%[115]. - Total borrowings rose significantly from $115.2 million at December 31, 2022, to $245.1 million as of September 30, 2023[200]. - FHLB-B advances increased from $85.0 million to $145.0 million, with a weighted average interest rate of 4.89%[202]. Loan Portfolio - The total loans receivable, net, amounted to $864.2 million, an increase from $838.0 million as of December 31, 2022, representing a growth of 3.0%[57]. - The commercial real estate loan portfolio increased to $499.1 million from $437.4 million, reflecting a growth of 14.1%[57]. - The outstanding unsecured consumer loans totaled $58.6 million as of September 30, 2023, down from $78.9 million at the end of 2022, a decrease of 25.5%[65]. - The commercial and industrial loan portfolio remains stable at $160.5 million as of September 30, 2023, compared to $138.8 million at the end of 2022, an increase of 15.6%[62]. - The total past due loans across all segments amounted to $30,830,000, indicating a need for monitoring and potential risk management[92]. Securities and Investments - The company reported an unrealized holding loss on securities of $3,636,000 for Q3 2023, compared to a loss of $5,587,000 in Q3 2022[16]. - As of September 30, 2023, total available-for-sale securities amounted to $85.686 million, with gross unrealized losses of $25.252 million, reflecting a decline of 22.8% from the amortized cost[47][48]. - The fair value of available-for-sale securities classified as Level 2 is $75,815,000 as of September 30, 2023, compared to $75,093,000 at December 31, 2022, showing a slight increase of 1%[161]. - The fair value of Level 3 available-for-sale securities at the end of Q3 2023 was $9,871,000, down from $10,342,000 at the beginning of the year[167]. Operational Changes - The company initiated a reduction in force on November 1, 2023, resulting in a restructuring charge of approximately $500,000 and an annualized reduction in salary and benefit costs of about $3.5 million[170]. - The company is negotiating with a third-party consumer loan originator/servicer, which is expected to lead to a material recovery of a portion of the allowance for credit losses and commitment reserve associated with its consumer loan portfolio[171]. Regulatory and Compliance - The company continues to monitor SEC actions regarding disclosure requirements and plans accordingly for adoption[46]. - The company has not paid any dividends since 2020 and has no current plans to do so[126].

Financial Performance - For the three months ended June 30, 2023, total interest and dividend income increased to $15,309,000, up 57.5% from $9,687,000 in the same period of 2022[15]. - The company reported a net loss of $546,000 for the three months ended June 30, 2023, compared to a net income of $1,265,000 in the same period of 2022[15]. - Net loss for the six months ended June 30, 2023, was $599,000 compared to a net income of $2,065,000 in 2022, representing a significant decline[22]. - Comprehensive loss for the three months ended June 30, 2023, was $2,187,000, compared to a comprehensive loss of $2,901,000 in the same period of 2022[17]. - The company’s basic loss per share for the three months ended June 30, 2023, was $0.14, compared to earnings of $0.32 per share in the same period of 2022[15]. Credit Losses and Provisions - The provision for credit losses increased significantly to $1,231,000 for the three months ended June 30, 2023, compared to $275,000 in the same period of 2022[15]. - Provision for credit losses increased to $2,567,000 in 2023 from $275,000 in 2022, indicating a rise in expected credit losses[22]. - The total allowance for credit losses increased to $16.9 million as of June 30, 2023, from $10.3 million at December 31, 2022, due to the adoption of CECL[187]. - The charge-offs for the six months ended June 30, 2023, totaled $4.468 million[85]. - The recoveries for the six months ended June 30, 2023, amounted to $460,000[85]. Interest and Expenses - The interest expense for the three months ended June 30, 2023, was $7,596,000, significantly higher than $1,967,000 in the same period of 2022[15]. - Total non-interest expense rose to $8,063,000 for the three months ended June 30, 2023, an increase of 24% from $6,502,000 in the same period of 2022[15]. - Cash paid for interest surged to $12,609,000 in 2023 from $3,482,000 in 2022, reflecting higher borrowing costs[23]. Assets and Equity - As of June 30, 2023, total shareholders' equity was $52,445,000, down from $54,609,000 at the end of the previous quarter[19]. - Total assets rose by $119.4 million to $1.2 billion as of June 30, 2023, primarily driven by increases in cash and loans receivable[180]. - Total cash and cash equivalents at the end of the period increased to $70,809,000 in 2023 from $37,516,000 in 2022[22]. Loans and Deposits - The company originated $132,611,000 in loans receivable in 2023, compared to $138,414,000 in 2022, indicating a slight decrease in loan origination activity[22]. - The total deposits held by the company amounted to $863.4 million, a slight increase from $860.4 million as of December 31, 2022[115]. - The net loan to deposit ratio was 105.8% and the net loan to total assets ratio was 78.6% as of June 30, 2023, compared to 106.2% and 80.3% at December 31, 2022, respectively[185]. Securities and Investments - As of June 30, 2023, the total available-for-sale securities amounted to $90.547 million, with an amortized cost of $112.163 million, resulting in gross unrealized losses of $21.679 million[48]. - The fair value of U.S. Government agency and mortgage-backed securities was $67.248 million as of June 30, 2023, with unrealized losses of $15.007 million[48]. - The company does not intend to sell the debt securities and expects to recover their amortized cost, which may be at maturity[50]. Risk Management - The company has established credit policies that limit commercial real estate loans to 75% of the market value of the underlying collateral[59]. - The company employs an independent third-party loan review expert for semi-annual assessments of its risk rating process, ensuring compliance and accuracy in risk evaluations[88]. - The company monitors credit quality through various indicators, including cash flow, loan-to-value ratios, and debt service coverage ratios[86]. Regulatory and Compliance - The Tier 1 leverage ratio for Patriot Bank, N.A. as of June 30, 2023, was 8.70%, down from 9.27% as of December 31, 2022, remaining above the required 9.00% under the Community Bank Leverage Ratio framework[142][143]. - The company adopted ASU 2016-13 effective January 1, 2023, which did not have a material impact on the consolidated financial statements[45]. Shareholder Information - The total share-based compensation expense for the six months ended June 30, 2023, was $46,000, which included $28,000 attributable to employees and $18,000 for external directors[128]. - As of June 30, 2023, the unrecognized compensation expense for unvested restricted shares was $190,000, expected to be recognized over a weighted average remaining life of 2.3 years[127].

Financial Performance - Net interest income for Q1 2023 was $8,013 thousand, an increase of 19.1% compared to $6,726 thousand in Q1 2022[15]. - Net loss for Q1 2023 was $53 thousand, a decline from a net income of $800 thousand in Q1 2022[15]. - Comprehensive income for Q1 2023 was $1,194 thousand, compared to a comprehensive loss of $4,682 thousand in Q1 2022[16]. - For the three months ended March 31, 2023, the net income attributable to common shareholders was $(53,000), compared to $800,000 for the same period in 2022, resulting in a basic earnings per share of $(0.01) versus $0.20[131]. - The Company reported a net loss of $53,000 for Q1 2023, compared to a net income of $800,000 in Q1 2022, reflecting a significant decline in earnings[172]. Asset and Liability Management - Total assets increased to $1,100,012 thousand as of March 31, 2023, up from $1,043,359 thousand at December 31, 2022, representing a growth of 5.4%[12]. - Total deposits decreased slightly to $856,468 thousand as of March 31, 2023, from $860,446 thousand at December 31, 2022[12]. - The accumulated deficit increased to $37,581 thousand as of March 31, 2023, from $31,337 thousand at December 31, 2022[12]. - Shareholders' equity decreased to $54,609 thousand as of March 31, 2023, down from $59,583 thousand at December 31, 2022[12]. - The total financial liabilities as of March 31, 2023, are estimated at $1,032,380, compared to $969,211 as of December 31, 2022, indicating an increase of approximately 6.5%[160]. Credit Losses and Provisions - The provision for credit losses was $1,336 thousand in Q1 2023, compared to no provision in Q1 2022[15]. - The allowance for credit losses increased to $17.801 million as of March 31, 2023, compared to $10.310 million as of December 31, 2022, representing a significant rise of approximately 72.5%[54]. - The elevated provision for credit losses was $1.3 million in Q1 2023, contrasting with no provision recorded in Q1 2022, indicating increased risk management measures[173]. - The allowance for credit loss increased to $700,000 as of March 31, 2023, from $8,000 as of December 31, 2022, primarily due to the adoption of CECL[134]. Loan Portfolio and Performance - As of March 31, 2023, the total loans receivable, net, amounted to $860.968 million, an increase from $838.006 million as of December 31, 2022, reflecting a growth of approximately 2.3%[54]. - The commercial real estate loan segment reached $464.410 million as of March 31, 2023, up from $437.443 million at the end of 2022, indicating an increase of about 6.2%[54]. - The total past due loans across all segments amounted to $23,769,000, indicating potential credit risk[89]. - Total nonperforming assets rose to $27.2 million as of March 31, 2023, compared to $19.7 million as of December 31, 2022, representing a 37.5% increase[188]. - The commercial real estate segment reported a total of $432,144,000 in loans, with $4,387,000 classified as pass loans and $11,367,000 as substandard[89]. Deposits and Funding - Total deposits as of March 31, 2023, were $856.5 million, a slight decrease from $860.4 million at December 31, 2022[114]. - Non-interest bearing deposits decreased to $152.8 million as of March 31, 2023, from $269.6 million at December 31, 2022[114]. - The total value of certificates of deposit and brokered deposits was $311.5 million as of March 31, 2023[115]. - The balance of non-interest bearing deposits decreased by 43.34% to $152.8 million as of March 31, 2023, from $269.6 million at December 31, 2022[194]. Investment Securities - The investment securities portfolio increased by $7.2 million to $96.2 million, with a notable rise in U.S. Government agency and mortgage-backed securities by 14.38%[179]. - The fair value of available-for-sale securities increased from $75,093 as of December 31, 2022, to $81,531 as of March 31, 2023, representing an increase of about 8.5%[162]. - The total available-for-sale securities amounted to $111.141 million as of March 31, 2023, compared to $105.605 million as of December 31, 2022, showing an increase of approximately 5.0%[53]. Interest Income and Expense - Interest income recognized on non-accruing loans for the three months ended March 31, 2023, was $282,000, compared to $90,000 for the same period in 2022, reflecting a 213.3% increase[93]. - Interest expense for the three months ended March 31, 2023, was $1.4 million, compared to $737,000 for the same period in 2022, indicating an increase of 89.4%[199]. - The net interest margin decreased by 48 basis points to 3.29% from 3.77% in Q4 2022, but increased by 23 basis points from 3.06% in Q1 2022[174]. Risk Management - The Company’s commercial and industrial loans are subject to various risks, including economic downturns and changes in interest rates[75]. - The risk rating system includes an eleven-point scale, with assets classified as "substandard" indicating potential loss risk due to weaknesses in the obligor's net worth or paying capacity[85]. - The company monitors credit quality through indicators such as cash flow, loan-to-value ratios, and debt service coverage ratios[82]. Regulatory Compliance - The Bank's Tier 1 leverage ratio was 9.25% as of March 31, 2023, compared to 9.27% as of December 31, 2022, meeting the "greater than 9 percent" requirement under the CBLR framework[138]. - The Company adopted ASC 326 effective January 1, 2023, which did not have a material impact on its consolidated financial statements[43].

Financial Performance - Total assets increased to $1,043,359 thousand in 2022, up from $948,481 thousand in 2021, representing a growth of approximately 10%[214]. - Net interest income rose to $33,259 thousand in 2022, compared to $25,261 thousand in 2021, marking an increase of about 32%[215]. - Net income for 2022 was $6,161 thousand, up from $5,094 thousand in 2021, reflecting a growth of approximately 21%[215]. - Total deposits increased to $860,446 thousand in 2022, up from $748,562 thousand in 2021, indicating a growth of around 15%[214]. - Non-interest income decreased to $3,605 thousand in 2022 from $4,423 thousand in 2021, a decline of about 18%[215]. - The provision for loan losses was $1,885 thousand in 2022, compared to a credit of $500 thousand in 2021, indicating a shift in loan loss provisioning[215]. - Total non-interest expense increased to $27,222 thousand in 2022, up from $25,171 thousand in 2021, representing an increase of approximately 8%[215]. - The accumulated deficit improved to $(31,337) thousand in 2022 from $(37,498) thousand in 2021, showing a reduction of about 16%[219]. - Comprehensive loss for 2022 was $(7,847) thousand, compared to comprehensive income of $3,975 thousand in 2021, indicating a significant decline[217]. - Basic earnings per share increased to $1.56 in 2022 from $1.29 in 2021, reflecting a growth of approximately 21%[215]. Loan Portfolio and Allowance for Loan Losses - The Company's allowance for loan and lease losses totaled $10.3 million as of December 31, 2022, with $4.3 million related to loans collectively evaluated for impairment and $6.0 million for loans individually evaluated[207]. - The allowance for loan and lease losses was $10.3 million as of December 31, 2022, compared to $9.9 million in 2021[322]. - The allowance for loan losses may increase to reflect the decline in the performance of the loan portfolio and higher incurred losses[349]. - The company actively monitors credit quality indicators, including cash flow from business operations and debt service coverage ratios[344]. - Individually evaluated loans for impairment totaled $18.92 million as of December 31, 2022, while collectively evaluated loans amounted to $829.40 million[344]. - The allowance for loan and lease losses for commercial real estate increased to $6.97 million in 2022 from $5.06 million in 2021, a rise of approximately 37.7%[344]. - The company incurred net charge-offs of $1.6 million for unsecured consumer loans in 2022, with total outstanding loans from this program reaching $78.9 million[335]. - The company has established credit policies that limit the extension of credit on commercial real estate loans to 75% of the market value of the underlying collateral[323]. - The company recorded an employee retention credit of $2.9 million for the year ended December 31, 2021, which was included as a reduction to salaries and benefits non-interest expense[304]. Interest Rate Risk and Management - The Company aims to maximize long-term profitability while minimizing exposure to interest rate fluctuations by maintaining a proper balance between the timing and volume of assets and liabilities re-pricing[189]. - Management conducts quarterly interest income simulations to estimate the impact of changes in interest rates on net interest income under various assumptions[192]. - The Management Asset and Liability Committee monitors interest rate risk and reports to the Board of Directors, ensuring compliance with investment and liquidity policies[190]. - The estimated net interest income under a +200 basis point interest rate scenario is $46,131 thousand, which is a decrease of $1,177 thousand or 2.49% from the base case[196]. - The estimated net portfolio value under a +200 basis point interest rate scenario is $146,888 thousand, reflecting a decrease of $15,357 thousand or 9.47% from the base case[196]. - The estimated net portfolio value under a -200 basis point interest rate scenario is $155,386 thousand, reflecting a decrease of $6,859 thousand or 4.23% from the base case[196]. Goodwill and Impairment Testing - The Company’s goodwill balance was $1.1 million as of December 31, 2022, with an annual impairment test performed on October 31[210]. - The Company evaluates goodwill for impairment annually, with the last assessment conducted on October 31, and no impairment was indicated[278]. Securities and Investments - As of December 31, 2022, the fair value of available-for-sale securities was approximately $84.52 million, with gross unrealized losses of $21.09 million, representing a depreciation of 20.3% from amortized cost[315][316]. - The amortized cost of U.S. Government agency and mortgage-backed securities was $73.48 million as of December 31, 2022, with gross unrealized losses of $14.43 million[315]. - The company’s available-for-sale securities included corporate bonds with an amortized cost of $19.77 million and gross unrealized losses of $5.13 million as of December 31, 2022[315]. - The fair value of available-for-sale securities with stated maturity dates was $105.6 million as of December 31, 2022, compared to $96.5 million in 2021[320]. - The total amount of SBA loans held for sale increased to $5.2 million in 2022 from $3.1 million in 2021, with $3.1 million in commercial and industrial loans and $2.1 million in commercial real estate loans[375]. Cash Flow and Financing Activities - Cash flows from operating activities provided $7,036,000 in 2022, slightly down from $7,596,000 in 2021[221]. - Total cash and cash equivalents at the end of 2022 were $38,493,000, a decrease from $47,045,000 at the end of 2021[221]. - Cash paid for interest increased to $10,472,000 in 2022 from $7,210,000 in 2021[222]. - Net cash used in investing activities was $122,051,000 in 2022, compared to $55,205,000 in 2021[221]. - Net cash provided by financing activities was $106,463,000 in 2022, up from $60,018,000 in 2021[221]. Regulatory and Compliance Matters - The Company recognizes interest and penalties related to income tax matters in income tax expense[290]. - Directors and officers of the Company have had transactions with the Company, which were conducted in the ordinary course of business[299]. - The Company’s only business segment is Community Banking, which represented all revenues and income for the years ended December 31, 2022, 2021, and 2020[297]. - The company is not required to maintain cash reserves with the Federal Reserve Bank as of December 31, 2022, due to the elimination of reserve requirements[314]. Other Financial Metrics - The company completed the acquisition of Prime Bank in May 2018, which is included in the consolidated financial statements from the date of acquisition[226]. - The company had no applicable material accounting pronouncements adopted during 2022[307]. - The company transferred $274,000 and $281,000 of SBA loans from held for sale to held for investment in 2022 and 2021 respectively[375]. - The company recognized revenue based on ASC 606 principles, which require revenue recognition upon the completion of performance obligations[305].

Financial Performance - Total interest and dividend income for Q3 2022 was $12,039,000, a 51.9% increase from $7,960,000 in Q3 2021[10] - Net interest income after provision for loan losses for the nine months ended September 30, 2022, was $23,214,000, up from $18,654,000 in the same period of 2021, representing a 24.4% increase[10] - Net income for Q3 2022 was $2,326,000, a 76% increase from $1,323,000 in Q3 2021[10] - Basic earnings per share for Q3 2022 was $0.59, compared to $0.34 in Q3 2021, marking a 73.5% increase[10] - Net income for the nine months ended September 30, 2022, was $4,391, compared to $3,199 for the same period in 2021, representing a 37.3% increase[18] - Total non-interest income for the nine months ended September 30, 2022, was $2,266,000, compared to $2,118,000 in the same period of 2021, indicating a growth of 7%[10] - Total non-interest expense for Q3 2022 was $7,214,000, an increase from $5,711,000 in Q3 2021, which is a 26.3% rise[10] - The provision for income taxes in Q3 2022 was $157,000, down from $479,000 in Q3 2021, showing a decrease of 67.2%[10] Asset and Liability Management - The total assets of the company as of September 30, 2022, were $1,200,000,000, reflecting growth from the previous year[10] - Cash and cash equivalents at the end of the period for September 30, 2022, were $31,184, down from $46,265 at the end of September 30, 2021[19] - The company had a balance of $3,947,976 in common shares as of September 30, 2021, reflecting an increase from the previous period[16] - The total financial assets amounted to $998,801,000, with an estimated fair value of $977,709,000, compared to $892,719,000 and $891,279,000 as of December 31, 2021[153] - The total financial liabilities were $990,939,000 with an estimated fair value of $982,459,000 as of September 30, 2022, compared to $870,364,000 and $873,377,000 as of December 31, 2021[153] Loan Portfolio and Credit Quality - As of September 30, 2022, net loans receivable totaled $852.9 million, an increase of 16.9% from $729.6 million as of December 31, 2021[40] - The commercial real estate loan portfolio increased to $438.8 million from $365.2 million, reflecting a growth of 20.1%[40] - The allowance for loan and lease losses was $9.95 million as of September 30, 2022, slightly up from $9.91 million at the end of 2021[40] - The company’s lending activities are primarily focused in Connecticut and New York, with a significant reliance on the regional economy and real estate market conditions[40] - The total allowance for loan and lease losses as of September 30, 2021, was $10,079,000, indicating a decrease in the allowance compared to the current year[58] Investment Activities - The company purchased $11.8 million in U.S. Government agency mortgage-backed securities during the nine months ended September 30, 2022, a decrease from $112.0 million in the same period of 2021[39] - The company did not sell any available-for-sale securities during the three and nine months ended September 30, 2022, contrasting with sales totaling $53.7 million in 2021[39] - The total gross unrealized losses on available-for-sale securities as of September 30, 2022, amounted to $20.8 million, compared to $2.4 million on December 31, 2021, indicating a significant increase in losses[34] - The company has pledged available-for-sale securities worth $28.3 million to the Federal Reserve Bank as of September 30, 2022, down from $36.6 million on December 31, 2021[36] Deposits and Funding - Total deposits increased to $834.4 million as of September 30, 2022, up from $748.6 million at December 31, 2021, representing an increase of 11.5%[100] - Non-interest bearing deposits rose to $247.7 million, compared to $226.7 million in the previous year, reflecting an increase of 9.2%[100] - The company incurred share-based compensation expenses of $63 for the nine months ended September 30, 2022, down from $110 in 2021, reflecting a decrease of 42.7%[18] Risk Management - The company has established a credit approval process to mitigate credit risk associated with off-balance-sheet financial instruments[121] - The company monitors credit quality through indicators such as cash flow, loan-to-value ratios, and debt service coverage ratios[61] - A risk rating system is employed, requiring credit officers to assign ratings at loan origination, which are reviewed by the Loan Committee[62] - The internal eleven-point risk rating system classifies loans based on their risk, with categories including "special mention," "substandard," and "doubtful"[65][67] Other Financial Metrics - The company recognized $1.9 million in expenses related to the terminated merger with American Challenger for the full year ended December 31, 2021[98] - The carrying value of servicing assets increased to $706,000 as of September 30, 2022, compared to $584,000 at December 31, 2021, marking a rise of 20.8%[92] - The company has not paid any dividends since 2020 and has no present plans to pay dividends[117]

Financial Performance - For the three months ended June 30, 2022, net interest income increased to $7,720,000, up 30% from $5,938,000 in the same period of 2021[11] - Total interest and dividend income for the six months ended June 30, 2022, was $18,007,000, representing a 13.3% increase from $15,878,000 in 2021[11] - Non-interest income for the three months ended June 30, 2022, was $798,000, a slight increase from $753,000 in the same period of 2021[11] - Net income for the three months ended June 30, 2022, was $1,265,000, compared to $1,022,000 in the same period of 2021, marking a 24% increase[11] - Basic earnings per share for the three months ended June 30, 2022, was $0.32, up from $0.26 in the same period of 2021[11] - Net income for the six months ended June 30, 2022, was $2,065,000, an increase from $1,876,000 in the same period of 2021, representing a growth of approximately 10.1%[19] - Total comprehensive income for the six months ended June 30, 2022, was $2,563,000, up from $1,879,000 in 2021, indicating a growth of 36.5%[19] Expenses and Loss Provisions - The provision for loan losses for the three months ended June 30, 2022, was $275,000, compared to $0 in the same period of 2021[11] - Total non-interest expense increased to $6,502,000 for the three months ended June 30, 2022, up from $5,286,000 in 2021, reflecting a 23% increase[11] - The provision for loan losses was $275,000 for the six months ended June 30, 2022, while there was no provision for loan losses in the same period of 2021[19] - Charge-offs for the six months ended June 30, 2022, amounted to $285,000, while recoveries were $34,000[61] Assets and Equity - The balance of common stock increased to $106,520,000 as of June 30, 2022, from $106,500,000 at the end of the previous quarter[15] - The total shareholders' equity as of June 30, 2022, was $59,802,000, down from $62,683,000 at the end of the previous quarter[15] - Cash and cash equivalents at the end of the period for June 30, 2022, were $37,516,000, down from $116,191,000 at the end of June 30, 2021, indicating a decrease of approximately 67.7%[20] - The company reported a net cash used in operating activities of $2,241,000 for the six months ended June 30, 2022, compared to a net cash provided of $485,000 in the same period of 2021[19] Loans and Credit Quality - The company originated $138,414,000 in loans receivable for the six months ended June 30, 2022, compared to $59,362,000 in the same period of 2021, indicating an increase of approximately 133.3%[20] - The company’s allowance for loan and lease losses was $9.929 million as of June 30, 2022, slightly up from $9.905 million at the end of 2021[41] - The total gross loans receivable as of June 30, 2022, was $859,107,000, with $23,492,000 individually evaluated for impairment and $835,615,000 collectively evaluated[63] - The total performing loans amounted to $835,783,000, with $859,107,000 in gross loans receivable[72] - The commercial real estate loan portfolio increased to $448.884 million as of June 30, 2022, up from $365.247 million at the end of 2021, reflecting a growth of about 22.8%[41] Securities and Investments - As of June 30, 2022, available-for-sale securities had a fair value of $76.971 million, down from $94.341 million as of December 31, 2021, reflecting a decline of 18.4%[35] - The gross unrealized losses on available-for-sale securities amounted to $15.214 million as of June 30, 2022, compared to $2.384 million as of December 31, 2021, indicating a significant increase in losses[35] - The company purchased $2.0 million in corporate bonds and $1.0 million in subordinated notes during the six months ended June 30, 2022[40] - The company did not sell any available-for-sale securities during the three and six months ended June 30, 2022[40] Risk Management and Credit Policies - The company has established credit policies that limit commercial real estate loans to 75% of the market value of the underlying collateral[42] - The company employs a risk rating system for its loan portfolio, requiring credit officers to assign a risk rating at origination, which is reviewed by the Loan Committee[65] - The company monitors credit quality through indicators like cash flow, loan-to-value ratios, and debt service coverage ratios[64] - The company has established a credit approval process to mitigate credit risk associated with off-balance-sheet financial instruments[122] Other Financial Metrics - The Tier 1 leverage ratio as of June 30, 2022, was 9.44%, slightly down from 9.86% at the end of 2021, but still above the 9% requirement for being considered "well capitalized"[130] - The reserve for credit loss remained stable at $8,000,000 as of June 30, 2022, consistent with the previous year[124] - The company recognized total share-based compensation expense of $20,000 and $41,000 for the three and six months ended June 30, 2022, respectively[115]

Financial Performance - Net interest income for Q1 2022 was $6,726,000, an increase of 9.8% from $6,126,000 in Q1 2021[9] - Total interest and dividend income rose to $8,320,000, up 2.6% from $8,111,000 in the same period last year[9] - Non-interest income increased significantly to $814,000, a 84.3% rise compared to $442,000 in Q1 2021[9] - Net income for Q1 2022 was $800,000, down 6.3% from $854,000 in Q1 2021[9] - Comprehensive loss for Q1 2022 was $(4,682,000), compared to comprehensive income of $684,000 in Q1 2021[10] - Basic earnings per share for the first quarter of 2022 was $0.20, down from $0.22 in the same quarter of 2021[9] Expenses and Income - Total non-interest expense for Q1 2022 was $6,429,000, reflecting a 19.2% increase from $5,395,000 in Q1 2021[9] - The company did not recognize any net gain or loss in other noninterest income during the three months ended March 31, 2022[97] Cash and Deposits - Cash and cash equivalents at the end of Q1 2022 were $44,316,000, a decrease from $84,274,000 at the end of Q1 2021[13] - The company reported an increase in deposits of $31,287,000 in Q1 2022, compared to $7,222,000 in Q1 2021[13] - As of March 31, 2022, total deposits increased to $779.8 million from $748.6 million as of December 31, 2021, reflecting a growth of approximately 4.2%[93] Loans and Credit Quality - As of March 31, 2022, the net loans receivable totaled $763.6 million, an increase from $729.6 million as of December 31, 2021, representing a growth of 4.6%[34] - The allowance for loan and lease losses was $9.7 million as of March 31, 2022, slightly down from $9.9 million at the end of 2021[34] - The total amount of loans receivable evaluated for impairment was $749,691,000 as of March 31, 2022, compared to $716,276,000 on December 31, 2021, representing an increase of about 4.7%[55] - The company reported charge-offs of $185,000 for the three months ended March 31, 2022, compared to $272,000 for the same period in 2021, showing a decrease of approximately 31.9%[54] - The company employs a risk rating system for its loan portfolio, with all commercial loans over $250,000 reviewed annually or biannually[56] Securities and Investments - As of March 31, 2022, the amortized cost of available-for-sale securities was $92.855 million, with a fair value of $83.260 million, reflecting a decline of 10.7% from the amortized cost[28] - The gross unrealized losses on available-for-sale securities amounted to $9.647 million as of March 31, 2022, compared to $2.384 million as of December 31, 2021[28] - Thirty-seven out of thirty-nine available-for-sale securities had unrealized losses as of March 31, 2022, indicating a significant number of securities in a loss position[28] - The company believes that none of the losses on available-for-sale securities constitute other-than-temporary impairment, as the losses are considered temporary due to market fluctuations[29] Loan Portfolio Composition - The commercial real estate loan portfolio increased to $413.1 million as of March 31, 2022, up from $365.2 million at the end of 2021, reflecting a growth of 13.1%[34] - The company reported a total of $18.4 million in unsecured consumer loans purchased during Q1 2022, compared to none in Q1 2021[44] - The company's syndicated and leveraged loan portfolio totaled $20.8 million as of March 31, 2022, an increase from $19.6 million at the end of 2021[41] Impaired Loans and TDRs - The total recorded investment in Troubled Debt Restructurings (TDRs) was $10,349,000 as of March 31, 2022, compared to $10,394,000 at the end of 2021, indicating a decrease of 0.4%[70] - The company identified thirty-five impaired loans totaling $24.2 million as of March 31, 2022, with specific reserves of $2.7 million established for twenty-five of these loans[74] - The total allowance for impaired loans was $2,715,000 as of March 31, 2022, compared to $2,299,000 at December 31, 2021, reflecting a 18.1% increase[78] Regulatory and Compliance - The company's Tier 1 leverage ratio was 9.94% as of March 31, 2022, up from 9.86% at December 31, 2021, indicating compliance with the "well capitalized" status under the Community Bank Leverage Ratio framework[121][122] - The company has established credit policies that limit the extension of credit on commercial real estate loans to 75% of the market value of the underlying collateral[35] Miscellaneous - The company incurred $1.9 million in project expenses related to the merger with American Challenger as of March 31, 2022[90] - The company’s goodwill remained unchanged at $1.1 million as of March 31, 2022, with no impairment assessment performed during the quarter[86][88]