Princeton Bancorp(US:BPRN)2025-11-07 21:14Financial Position - Total assets decreased by $111.1 million, or 4.75%, to $2.23 billion at September 30, 2025, compared to $2.34 billion at the end of 2024[128] - Cash and cash equivalents decreased by $44.5 million, or 37.9%, to $72.9 million at September 30, 2025[129] - Total available-for-sale investment securities decreased by $37.2 million, or 15.1%, to $209.9 million at September 30, 2025[130] - Net loans decreased by $25.1 million, or 1.38%, to $1.79 billion at September 30, 2025, with significant decreases in construction loans and commercial real estate loans[131] - Total deposits decreased by $104.0 million, or 5.12%, at September 30, 2025, primarily due to decreases in certificates of deposit and money market deposits[136] - Non-performing assets totaled $16.7 million, a decrease of $10.1 million from December 31, 2024, with non-performing assets as a percentage of total loans at 0.93%[135] Equity and Capital Ratios - Total stockholders' equity increased by $4.6 million, or 1.74%, to $267.5 million at September 30, 2025, primarily due to an increase in retained earnings[139] - The ratio of equity to total assets improved to 12.0% at September 30, 2025, compared to 11.2% at December 31, 2024[139] - As of September 30, 2025, the total capital to risk-weighted assets ratio was 13.780%, exceeding the well-capitalized requirement of 10.000%[148] - The Tier 1 capital to risk-weighted assets ratio was 12.726% as of September 30, 2025, above the minimum requirement of 8.000%[148] Income and Expenses - The Company reported a net income of $6.5 million, or $0.95 per diluted common share, for Q3 2025, compared to a net loss of ($4.5) million, or ($0.68) per diluted common share, for Q3 2024[149] - Interest income increased by $935 thousand for Q3 2025, with interest income on loans rising by $1.8 million due to an increase in the average balance of loans by $125.9 million[150] - Interest expense decreased by $1.6 million to $13.1 million for Q3 2025, primarily due to a decrease of 53 basis points in the rate paid on interest-bearing deposits[151] - The Company recorded a reversal of credit losses of $672 thousand during Q3 2025, with no charge-offs recorded and recoveries amounting to $86 thousand[152] - Total non-interest income was $1.9 million for Q3 2025, a decrease of $148 thousand or 7.2% compared to the same period in 2024[153] - Total non-interest expense was $13.9 million for Q3 2025, a decrease of $6.2 million or 30.9% compared to Q3 2024, primarily due to merger-related expenses recorded in the prior year[154] - The effective tax rate for Q3 2025 was 21.9%, compared to an income tax benefit resulting in an effective tax rate of (20.1)% for Q3 2024[155] Year-to-Date Performance - For the nine months ended September 30, 2025, the company reported net income of $12.5 million, or $1.82 per diluted common share, compared to $5.0 million, or $0.77 per diluted common share for the same period in 2024, reflecting a significant increase in net income[162] - Interest income increased by $9.5 million for the nine months ended September 30, 2025, primarily due to a $10.1 million increase in interest income on loans, attributed to an increase in the average balance of loans by $228.3 million[163] - The company recorded a provision for credit losses of $6.6 million for the nine months ended September 30, 2025, compared to $4.7 million for the same period in 2024, driven by a net charge-off of $7.5 million in the second quarter of 2025[165] - Non-interest income increased by $221 thousand, or 3.6%, for the nine months ended September 30, 2025, compared to the same period in 2024[166] - Non-interest expense decreased to $41.2 million for the nine months ended September 30, 2025, from $44.0 million in 2024, primarily due to the absence of merger-related expenses recorded in 2024[167] - The effective tax rate for the nine months ended September 30, 2025, was 20.5%, compared to 16.3% for the same period in 2024, with an income tax expense of $3.3 million[168] Interest Rate Risk Management - The company actively manages market risk, particularly interest rate risk, through monitoring and oversight policies to mitigate potential losses from adverse market changes[174] - The company has established an Asset/Liability Committee to manage interest rate risk and ensure alignment with business strategy and performance objectives[175] - As of September 30, 2025, total interest-earning assets amount to $2,040,490,000, while total interest-bearing liabilities are $1,634,250,000, resulting in a negative interest sensitivity gap of $406,240,000[178] - The cumulative interest-rate sensitivity gap as a percentage of total assets at September 30, 2025 is -29.08% for the 3-month period and -38.25% for the 1-year period[178] - The net portfolio value (NPV) as of September 30, 2025 is $340,535,000, with a projected decrease of 8.35% under a 300 basis points increase in interest rates[181] - The company expects a negative interest rate sensitivity gap to adversely affect net interest income during periods of rising interest rates[176] - Interest-earning assets as a percentage of cumulative interest-bearing liabilities at September 30, 2025 is 41.83% for the 3-month period and 126.73% for the 5-year period[178] - The interest rate sensitivity gap analysis indicates that the company may face challenges in managing interest rate fluctuations effectively[179] - The NPV ratio under various interest rate scenarios reflects the company's exposure to interest rate risk, with significant changes projected under different rate shocks[180] Internal Controls - The company has not identified any changes in internal control over financial reporting that materially affect its operations as of September 30, 2025[184] - Management has concluded that the company's disclosure controls and procedures are effective as of September 30, 2025, ensuring compliance with reporting requirements[183]