Peapack-Gladstone Financial (PGC) - 2024 Q3 - Quarterly Report

Financial Performance - Net income for the three months ended September 30, 2024, was $7,587 thousand, down from $8,755 thousand, a decrease of 13.3%[9] - Basic earnings per share decreased to $0.43 from $0.49, reflecting a decline of 12.2%[9] - Comprehensive income for the nine months ended September 30, 2024, was $33,806,000, compared to $32,813,000 for the same period in 2023, reflecting an increase of 3%[11] - Net income for the nine months ended September 30, 2024, was $23,748,000, a decrease of 41.0% from $40,255,000 for the same period in 2023[14] - The company reported a total of 23,726 nonaccrual loans with no allowance for credit loss as of September 30, 2024, reflecting ongoing monitoring of loan performance[107] Asset and Liability Management - Total assets increased to $6,793,792 thousand as of September 30, 2024, up from $6,476,857 thousand at December 31, 2023, representing a growth of approximately 4.9%[7] - Total deposits rose to $5,935,386 thousand, an increase of 12.5% compared to $5,274,114 thousand at the end of 2023[7] - The total shareholders' equity as of September 30, 2024, was $588,322,000, compared to $565,069,000 as of September 30, 2023[13] - Total cash and cash equivalents at the end of the period increased to $492,658,000 from $187,869,000, reflecting a significant increase of about 162%[16] - The company has available unused short-term overnight borrowing capacity of $1.8 billion through the FHLB and $1.8 billion at the Federal Reserve Bank of New York[151] Loan Performance - Total loans outstanding as of September 30, 2024, amounted to $5,315,417, a decrease from $5,429,325 as of December 31, 2023, representing a decline of approximately 2.1%[105] - The company experienced a decrease in retained earnings from $408,481,000 as of September 30, 2023, to $394,094,000 as of September 30, 2024[14] - The company reported a net cash provided by financing activities of $243,052,000, up from $129,826,000 in the same period last year, indicating an increase of approximately 87%[16] - The company reported a total of $1,080,209 thousand in loans originated, a decrease from $1,292,990 thousand in the prior period, representing a decline of approximately 16.4%[121] - The company did not record any allowance for credit losses for the nine months ended September 30, 2024, indicating confidence in the credit quality of its securities[103] Income and Expenses - Operating expenses increased to $44,649 thousand for the three months ended September 30, 2024, up from $37,413 thousand, a rise of 19.5%[9] - Total noninterest income for the three months ended September 30, 2024, was $18,938, a decrease of 2.14% from $19,354 in the same period of 2023[179] - Wealth management fee income increased to $15,150 thousand from $13,975 thousand, a growth of 8.4%[9] - The company recorded a loss on the sale of property amounting to $4,000 for the nine months ended September 30, 2024[185] - The total operating expense for the Banking segment in Q3 2024 was $35,889,000, while Peapack Private's was $9,984,000, totaling $45,873,000[155] Credit Quality and Provisions - Provision for credit losses decreased significantly to $1,224 thousand from $5,856 thousand year-over-year, indicating improved credit quality[9] - The allowance for credit losses (ACL) is determined using a non-linear discounted cash flow (DCF) model, which captures losses over the historical charge-off and prepayment cycle[40] - The company reported a provision for credit losses of $5,762,000, down from $9,065,000 in the previous year, indicating a decrease of about 36%[16] - The ACL as a percentage of loans was 1.34% at September 30, 2024, compared to 1.21% at December 31, 2023, indicating a rise in credit risk assessment[137] - The company has adopted CECL, evaluating loans in foreclosure on an individual basis for potential loss and allowance adequacy[116] Shareholder Activities - The company declared cash dividends of $0.05 per share, totaling $(882,000) for the three months ended September 30, 2024[13] - The company repurchased 100,000 shares during the three months ended September 30, 2024, at a cost of $(2,592,000)[13] - Cash dividends declared on common stock were $2,656,000, compared to $2,666,000 in the previous year, showing a slight decrease of about 0.4%[16] - The Company has a total of $7.8 million in unrecognized compensation costs related to service-based and performance-based restricted stock units, expected to be recognized over a weighted average period of 1.07 years[73] - Total shares issued under the Employee Stock Purchase Plan (ESPP) during Q3 2024 was 11,257, compared to 8,850 in Q3 2023[81] Market and Economic Conditions - The company has no overnight borrowings with the Federal Home Loan Bank (FHLB) as of September 30, 2024, compared to $403.8 million at December 31, 2023[151] - The company has elected the fair value option for certain loans held for sale, indicating a strategic approach to asset management[170] - The company reported unrealized holding gains of $23,974,000 for the three months ended September 30, 2024, compared to a loss of $(20,629,000) for the same period in 2023[11] - The company recorded a net unrealized holding loss on securities available for sale of $(57,614,000) as of September 30, 2024, compared to $(91,034,000) as of September 30, 2023[190] - The total fair value of individually evaluated loans includes $22,947,000 for commercial and industrial loans as of December 31, 2023[174]