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Primis(FRST) - 2024 Q1 - Quarterly Report

Financial Performance - Net income attributable to Primis' common stockholders decreased to $2,466 thousand for Q1 2024, down from $8,363 thousand in Q1 2023, a decline of 70.5%[7] - As of March 31, 2024, net income was $812,000, a significant decrease from $8,363,000 in the same period of 2023, representing a decline of approximately 90.3%[10] - The company reported a comprehensive income of $628 thousand for Q1 2024, down from $10,738 thousand in Q1 2023, a decline of 94.1%[7] - Basic earnings per share (EPS) for the three months ended March 31, 2024, was $0.10, a decrease from $0.34 in the same period of 2023[109] - Net income for Q1 2024 was $2.5 million, a 71% decrease from $8.4 million in Q1 2023, primarily due to a $9.4 million drop in derivative gains[125] Asset and Liability Management - Total assets increased to $3,889,979 thousand as of March 31, 2024, compared to $3,856,546 thousand on December 31, 2023, reflecting a growth of 0.86%[5] - Total liabilities rose to $3,495,380 thousand as of March 31, 2024, compared to $3,458,953 thousand on December 31, 2023, an increase of 1.06%[5] - Stockholders' equity decreased to $394,599 thousand from $397,593 thousand, a decline of 0.75%[5] - The company reported a decrease in total equity to $394,599,000 as of March 31, 2024, down from $397,593,000 on December 31, 2023, a decline of 0.7%[137] Loan Portfolio - Total loans held for investment increased to $3.227 billion as of March 31, 2024, compared to $3.219 billion as of December 31, 2023[37] - The company reported $205.1 million in loans outstanding in the Consumer Program as of March 31, 2024, representing 6% of the total gross loan portfolio[38] - The company’s total real estate loans decreased to $1.976 billion as of March 31, 2024, from $1.998 billion as of December 31, 2023[37] - The total loans not past due as of March 31, 2024, were $3.185 billion, indicating a stable loan portfolio[42] - The total amount of loans under "Special Mention" was reported at $1,282, unchanged from the previous year, indicating stability in this category[58] Credit Quality and Allowance for Credit Losses - The allowance for credit losses increased to $53,456 thousand as of March 31, 2024, compared to $52,209 thousand on December 31, 2023, indicating a rise of 2.38%[5] - The provision for credit losses increased to $6,508,000 in Q1 2024, compared to $5,263,000 in Q1 2023, representing a rise of 23.6%[10] - Nonperforming assets increased to $11,853,000 as of March 31, 2024, compared to $10,809,000 on December 31, 2023, indicating a rise in asset quality concerns[144] - The company performed quantitative and qualitative analyses to determine that none of the investment securities required an allowance for credit losses[34] Income and Expense Analysis - Total interest and dividend income increased to $50,345 thousand, up from $44,258 thousand, representing a growth of 13.5% year-over-year[7] - Noninterest income decreased significantly to $10,307 thousand in Q1 2024 from $17,670 thousand in Q1 2023, a drop of 41.6%[7] - Noninterest expense for Q1 2024 was $27.5 million, an increase of $0.6 million compared to Q1 2023[124] - The net interest margin improved to 2.84% for the three months ended March 31, 2024, compared to 2.81% for the same period in 2023[129] Capital and Regulatory Ratios - The leverage ratio for Primis Bank was 9.91% as of March 31, 2024, exceeding the required minimum of 5.00%[164] - Common equity tier 1 capital ratio for Primis Bank was 11.09% as of March 31, 2024, above the required minimum of 6.50%[164] - Total risk-based capital ratio for Primis Bank was 12.35% as of March 31, 2024, surpassing the required minimum of 10.00%[164] - Primis Bank maintained a capital conservation buffer of 4.35% as of March 31, 2024, exceeding the 2.50% minimum requirement[165] Investment Securities - The amortized cost of available-for-sale investment securities was $260.4 million with a fair value of $230.6 million as of March 31, 2024, reflecting gross unrealized losses of $29.9 million[27] - The company purchased available-for-sale investment securities totaling $8.8 million during the three months ended March 31, 2024, with no purchases in the same period of 2023[30] - The fair value of available-for-sale securities as of March 31, 2024, was $214.216 million, down from $203.880 million as of December 31, 2023[35] Operational Highlights - Primis Bank operated 24 full-service branches in Virginia and Maryland as of March 31, 2024, continuing to expand its physical presence[12] - The company completed a $24.5 million Series B financing round for Panacea Financial Holdings, acquiring approximately 19% of its common stock[16] - The company is focused on implementing various strategic initiatives, including new digital banking platforms and cost-saving projects to reduce administrative expenses[114]