Pioneer Bancorp(PBFS) - 2024 Q4 - Annual Report

Financial Performance - Net income decreased to $15,260 thousand in 2024 from $21,948 thousand in 2023, a decline of 30.4%[292] - The efficiency ratio worsened to 73.31% in 2024 from 65.05% in 2023, indicating increased operational costs relative to income[293] - The bank's return on average assets decreased to 0.80% in 2024 from 1.15% in 2023[293] - Total shareholders' equity grew by $29.8 million, or 11.2%, to $296.5 million at June 30, 2024, primarily due to net income of $15.3 million[331] - Total comprehensive income increased to $29,770,000 for June 2024, compared to $23,560,000 for the previous year, reflecting a growth of 26.2%[364] - Cash flows from operating activities were $23,847,000 for June 2024, down from $26,269,000 in the prior year, representing a decline of 9.4%[369] Income and Revenue - Net interest income rose to $66,513 thousand in 2024, up from $65,541 thousand in 2023, reflecting an increase of 1.5%[292] - Non-interest income increased to $16,330 thousand in 2024, compared to $14,148 thousand in 2023, marking a growth of 15.4%[292] - Total interest and dividend income increased to $88,316 thousand in 2024, up from $71,033 thousand in 2023, representing a growth of approximately 24.4%[363] - Interest and dividend income increased by $17.3 million, or 24.3%, to $88.3 million for the year ended June 30, 2024, driven by a 99 basis points increase in the average yield on interest-earning assets to 5.02%[333] - Interest income on loans rose by $17.2 million, or 31.0%, to $72.4 million, attributed to a 51 basis points increase in the average yield on loans to 5.72% and a $206.2 million increase in the average balance of loans to $1.27 billion[334] Assets and Liabilities - Total assets increased to $1,895,404 thousand in 2024 from $1,856,191 thousand in 2023, representing a growth of approximately 2.1%[291] - Cash and cash equivalents increased by $14.7 million, or 9.8%, to $165.2 million at June 30, 2024[325] - Total deposits increased by $8.4 million, or 0.5%, to $1.55 billion at June 30, 2024, with demand accounts up by 13.8%[330] - Net loans receivable rose by $199.9 million, or 17.5%, to $1.34 billion at June 30, 2024, driven by a 36.8% increase in residential mortgage loans[327] - Total securities available for sale decreased by $174.3 million, or 40.4%, to $257.4 million at June 30, 2024, primarily due to maturities and sales[326] Credit Losses and Provisions - The provision for credit losses was $2,700 thousand in 2024, compared to no provision in 2023[292] - The provision for credit losses increased by $2.7 million, impacting net income negatively[332] - The allowance for credit losses may increase by $1.1 million, or 5.2%, with a 100 basis point increase in the projected rate of civilian unemployment[316] - The allowance for credit losses on loans was $21,801,000 as of June 30, 2024, compared to $22,469,000 in the prior year[452] Mergers and Acquisitions - The Pioneer Commercial Bank Merger is expected to close on October 1, 2024, allowing the bank to offer full municipal deposit banking services[295] - The Company completed the acquisition of certain assets of Hudson Financial LLC for a total of $2.0 million in cash, with an additional $1.5 million in contingent consideration, and recorded $1.4 million in customer list intangible assets and $2.1 million in goodwill[303] Operational Strategies - The Company aims to enhance non-interest income through the expansion of its financial services businesses, including insurance and employee benefits[307] - The Company emphasizes commercial customer acquisition, particularly in commercial lending, to increase interest income and establish relationships with local businesses[306] - The Company plans to consider future acquisition opportunities to expand its insurance and wealth management services[309] Legal and Regulatory Matters - The Company has been involved in legal proceedings that could result in significant losses, but the outcomes remain uncertain[318] - The company maintained a "well capitalized" status under regulatory guidelines as of June 30, 2024, exceeding all applicable regulatory capital requirements[351] Employee and Community Engagement - The Company maintains a focus on employee engagement and aims to be an employer of choice in the Capital Region[311]