BRIDGEWATER BANC(BWBBP) - 2023 Q4 - Annual Report

Financial Performance - Net Interest Income for 2023 was $105,174,000, a decrease of 18.9$129,698,000 in 2022[297]. - Net Income for 2023 was $39,960,000, down 25.2$53,392,000 in 2022[297]. - Basic Earnings Per Share decreased to $1.29 in 2023 from$1.78 in 2022, a decline of 27.5%[297]. - Percentage Change in Net Income for 2023 was (25.2%), reflecting a significant decline compared to the previous year[297]. - Net income for the year ended December 31, 2023, was $40.0 million, a decrease of 25$53.4 million in 2022[313]. - Earnings per diluted common share decreased to $1.27 in 2023 from$1.72 in 2022, reflecting a decline of approximately 26.2%[313]. - Return on Average Assets (ROA) for 2023 was 0.89%, down from 1.38% in 2022[297]. - Return on Equity (ROE) fell to 9.73% in 2023 from 13.90% in 2022, a decline of 30%[313]. Asset and Liability Management - Total Assets increased by 6.1% to $4,611,990,000 in 2023 from$4,345,662,000 in 2022[297]. - Total Loans, Gross rose by 4.3% to $3,724,282,000 in 2023 compared to$3,569,446,000 in 2022[297]. - Total Deposits increased by 8.6% to $3,709,948,000 in 2023 from$3,416,543,000 in 2022[297]. - Total interest-earning assets increased to $4,404,366 thousand with an average yield of 5.08$3,790,291 thousand and 4.35% in 2022[319]. - Total interest-bearing liabilities increased to $3,246,135 thousand with an average cost of 3.61$2,528,360 thousand and 1.34% in 2022[320]. - Total assets grew to $4,490,804 thousand, up from$3,866,480 thousand in 2022[319]. - Total liabilities increased by $234.9 million, or 5.9$4.19 billion as of December 31, 2023[366]. - Total deposits as of December 31, 2023, were $3.71 billion, an increase of$293.4 million, or 8.6%, compared to $3.42 billion in 2022[396]. Credit Quality - Nonperforming Loans increased to$919,000 in 2023 from $639,000 in 2022[298]. - The allowance for credit losses on loans was$50.5 million at December 31, 2023, an increase of $2.5 million from$48.0 million at December 31, 2022[390]. - The allowance for credit losses as a percentage of total loans was 1.36% at December 31, 2023, compared to 1.34% at December 31, 2022[390]. - Total net charge-offs for 2023 were $202,000, compared to a recovery of$(276,000) in 2022, indicating a significant shift in credit performance[391]. - Loans classified as watch totaled $26.5 million at December 31, 2023, down from$32.3 million at December 31, 2022[382]. - Loans classified as substandard totaled $35.9 million at December 31, 2023, compared to$28.0 million at December 31, 2022[382]. Operational Efficiency - The Efficiency Ratio for 2023 was 53.0%, compared to 41.5% in 2022, indicating increased operational costs[297]. - Noninterest expense totaled $59.3 million for the year ended December 31, 2023, a$2.7 million, or 4.8%, increase from $56.6 million in 2022[355]. - The efficiency ratio was 53.0$223.9 million, an increase of $59.0 million or 35.8$164.9 million in 2022[328]. - Interest income on loans for 2023 was $192.7 million, a$45.9 million or 31.2% increase from $146.8 million in 2022[330]. - Interest expense on interest-bearing liabilities was$117.2 million for 2023, an increase of $83.2 million or 244.7$34.0 million in 2022[332]. - The cost of total deposits was 2.73% for 2023, a 198 basis point increase from 0.75% in 2022[333]. - The net interest margin improved to 2.42% for the year, compared to 2.34% in 2022[320]. Capital and Equity - The company’s total equity reached $410,478,384 thousand, reflecting a strong capital position[320]. - Shareholders' equity increased by$31.5 million, or 8.0%, to $425.5 million in 2023 from$394.1 million in 2022[408]. - Tangible book value per share rose to $12.84, a 9.8$11.69 in 2022[409]. - Total risk-based capital ratio for the company was 13.97% as of December 31, 2023, exceeding the minimum required ratio of 8.00%[415]. Liquidity Management - As of December 31, 2023, total on- and off-balance sheet liquidity was $2.23 billion, an increase from$1.38 billion at December 31, 2022[425]. - Core deposits totaled approximately $2.55 billion, representing 68.7$114.4 million as of December 31, 2023, compared to $78.4 million in 2022[421]. Interest Rate Sensitivity - As of December 31, 2023, a 400 basis point increase in interest rates would lead to a 2.39$118,597 thousand[439]. - A 300 basis point decrease in interest rates would result in an 8.86% increase in net interest income, reaching $132,269 thousand[439]. - The projected net interest income is sensitive to the timing and magnitude of interest rate changes, which could lead to significant variations from the simulation results[440].