Glen Burnie Bancorp(GLBZ) - 2024 Q1 - Quarterly Report

Financial Performance - Net income for Q1 2024 was $3,000, a decrease from$ 435,000 in Q1 2023, primarily due to a $726,000 increase in interest expense and a$ 211,000 increase in provision for credit loss [109]. - Comprehensive loss for the first quarter of 2024 totaled $0.9 million, compared to income of$ 2.4 million for the same period in 2023, due to increased unrealized losses on securities [130]. - Noninterest income decreased to $229,000, down$ 16,000 or 6.53% from $245,000 in the prior year [127]. - Noninterest expenses decreased by$ 83,000 or 2.82% to $2.86 million from$ 2.94 million year-over-year, driven by lower salary and employee benefits [128]. - The company recorded an income tax benefit of $232,000, compared to an expense of$ 86,000 in the same period last year, resulting in an effective tax rate of 101.31% [129]. Interest Income and Expense - Total interest income increased by $120,000, or 3.65%, to$ 3.4 million in Q1 2024, driven by a $128,000 increase in loan interest income [111][119]. - Interest expense surged by$ 726,000, or 678.50%, to $833,000 in Q1 2024, attributed to higher rates on money market deposits and short-term borrowings [120]. - Net interest income decreased by$ 606,000, or 19.07%, to $2.6 million in Q1 2024 compared to Q1 2023 [118]. Assets and Deposits - Total assets rose to$ 369.9 million, an increase of $18.1 million from December 31, 2023 [112]. - Total deposits increased by$ 9.2 million, or 3.05%, during the first three months of 2024 [112]. - Total deposits as of March 31, 2024, totaled $309.2 million, an increase of$ 9.1 million or 3.05% from $300.1 million at the end of 2023 [136]. - Cash and cash equivalents totaled$ 42.6 million, an increase of $27.4 million, or 179.69%, from$ 15.2 million at December 31, 2023 [159]. - Nonperforming assets to total assets decreased to 0.10% from 0.15% year-over-year, with nonaccrual loans decreasing to $371,000 from$ 527,000 [136]. Credit Losses - The allowance for credit losses decreased by $122,000, or 5.66%, to$ 2.04 million as of March 31, 2024 [112]. - Provision for credit losses on loans was recognized at $169,000 compared to a$ 42,000 release in the same period last year, reflecting a $5.8 million decrease in the reservable balance of the loan portfolio [126]. Capital Ratios - The Bank's Tier 1 leverage ratio was 10.43% as of March 31, 2024, exceeding the minimum requirement of 4.0% [169]. - The Common Equity Tier 1 capital ratio was 17.14% as of March 31, 2024, well above the minimum requirement of 4.5% [169]. - The Total Capital ratio was 18.30% as of March 31, 2024, surpassing the minimum requirement of 8.0% [169]. - The capital conservation buffer is set at 2.5%, effectively raising the minimum required Common Equity Tier 1 capital ratio to 7.0% [165]. - The Bank was in full compliance with capital adequacy guidelines as of March 31, 2024, with all capital ratios exceeding the required thresholds [169]. Deposits Composition - The Bank's total interest-bearing deposits accounted for 62.7% of total deposits as of March 31, 2024, compared to 61.0% on December 31, 2023 [137]. - Interest-bearing deposits increased by$ 10.919 million, or 5.96%, from $183.145 million to$ 194.064 million [137]. - Money market deposits saw a significant increase of $19.845 million, or 73.95%, from$ 26.836 million to $46.681 million [137]. - Noninterest-bearing deposits decreased by$ 1.755 million, or 1.50%, from $116.922 million to$ 115.167 million [137]. Risk Management - The Bank's interest rate risk management policy includes limits on risk, with measures of net interest income at risk remaining within prescribed policy limits [146]. - The regulations impose minimum leverage rules and risk-based capital rules, ensuring the Bank maintains specified minimum ratios of capital to total assets and risk-weighted assets [169]. - The Bank's capital amounts and ratios are subject to qualitative judgments by regulators regarding components and risk weightings [164].