Parke Bancorp(US:PKBK)2023-11-08 20:37Financial Performance - Net income available to common shareholders for Q3 2023 decreased by $9.5 million, or 90.3%, to $1.0 million compared to $10.5 million in Q3 2022[120] - For the nine months ended September 30, 2023, net income available to common shareholders decreased by $11.1 million, or 35.3%, to $20.3 million compared to $31.3 million in the same period of 2022[127] - Non-interest income for Q3 2023 was $1.8 million, a decrease of $0.2 million compared to $2.0 million in Q3 2022[124] - Non-interest income for the nine months ended September 30, 2023, was $5.2 million, a decrease of $1.4 million, or 20.7%, compared to $6.6 million for the same period last year[131] Income and Expenses - Net interest income for Q3 2023 was $15.7 million, a decrease of $3.6 million, or 18.7%, from $19.3 million in Q3 2022[122] - Interest expense increased by $25.6 million, or 317.7%, for the nine months ended September 30, 2023, primarily due to a $22.2 million increase in interest paid on deposits[128] - Non-interest expense increased by $9.6 million, or 151.9%, to $15.8 million in Q3 2023, primarily due to a $9.5 million contingent loss related to cash theft[125] - Non-interest expense increased by $11.3 million to $29.0 million for the nine months ended September 30, 2023, primarily due to a $9.5 million contingent loss related to cash theft[132] Assets and Liabilities - Total assets as of September 30, 2023, were $1.98 billion, with total equity of $278.0 million[119] - Total liabilities were $1.71 billion at September 30, 2023, representing a $13.2 million, or 0.8%, decrease from $1.72 billion at December 31, 2022[142] - Total deposits decreased by $43.0 million, or 2.7%, to $1.53 billion at September 30, 2023, from $1.58 billion at December 31, 2022[142] - Loans increased by $48.6 million at September 30, 2023, primarily due to increases in commercial real estate and multi-family loans[141] Cash Flow - Cash provided by operating activities was $14.0 million for the nine months ended September 30, 2023, compared to $34.3 million for the same period in the prior year, a decrease of $20.3 million[162] - Cash used in investing activities was $48.0 million for the nine months ended September 30, 2023, significantly lower than $191.6 million in the same period last year[163] Equity and Investments - Total equity increased to $278.0 million at September 30, 2023, up from $266.0 million at December 31, 2022, an increase of $11.9 million[143] - Total investment securities decreased to $16.6 million at September 30, 2023, down $2.2 million or 11.5% from $18.7 million at December 31, 2022[146] Legal and Regulatory Matters - The company is involved in a legal matter with potential damages claimed at approximately $1.7 million, currently in early discovery stages[180] - Management believes no material losses are anticipated from various outstanding contingent liabilities and legal actions[181] - There are no material pending legal proceedings other than ordinary routine litigation incidental to the business[182] Taxation - Income tax expense was $6.2 million on income before taxes of $26.5 million for the nine months ended September 30, 2023, resulting in an effective tax rate of 23.5%[133] - The company evaluates tax positions based on the likelihood of sustaining them upon examination, with benefits recognized when more than 50% likely to be realized[177] Operational Metrics - The provision for credit losses was a recovery of $1.6 million for the nine months ended September 30, 2023, compared to a provision for credit losses of $1.0 million for the same period in 2022[129] - The net interest margin for the nine months ended September 30, 2023, was 3.40%, compared to 3.71% for the same period in 2022[139] - Noninterest-bearing deposits decreased by $121.4 million or 34.4% to $231.1 million at September 30, 2023, primarily due to a decrease in cannabis-related deposits[155]