Patriot National Bancorp(PNBK) - 2022 Q1 - Quarterly Report

Financial Performance - Net interest income for Q1 2022 was $6,726,000, an increase of 9.8% from $6,126,000 in Q1 2021[9] - Total interest and dividend income rose to $8,320,000, up 2.6% from $8,111,000 in the same period last year[9] - Non-interest income increased significantly to $814,000, a 84.3% rise compared to $442,000 in Q1 2021[9] - Net income for Q1 2022 was $800,000, down 6.3% from $854,000 in Q1 2021[9] - Comprehensive loss for Q1 2022 was $(4,682,000), compared to comprehensive income of $684,000 in Q1 2021[10] - Basic earnings per share for the first quarter of 2022 was $0.20, down from $0.22 in the same quarter of 2021[9] Expenses and Income - Total non-interest expense for Q1 2022 was $6,429,000, reflecting a 19.2% increase from $5,395,000 in Q1 2021[9] - The company did not recognize any net gain or loss in other noninterest income during the three months ended March 31, 2022[97] Cash and Deposits - Cash and cash equivalents at the end of Q1 2022 were $44,316,000, a decrease from $84,274,000 at the end of Q1 2021[13] - The company reported an increase in deposits of $31,287,000 in Q1 2022, compared to $7,222,000 in Q1 2021[13] - As of March 31, 2022, total deposits increased to $779.8 million from $748.6 million as of December 31, 2021, reflecting a growth of approximately 4.2%[93] Loans and Credit Quality - As of March 31, 2022, the net loans receivable totaled $763.6 million, an increase from $729.6 million as of December 31, 2021, representing a growth of 4.6%[34] - The allowance for loan and lease losses was $9.7 million as of March 31, 2022, slightly down from $9.9 million at the end of 2021[34] - The total amount of loans receivable evaluated for impairment was $749,691,000 as of March 31, 2022, compared to $716,276,000 on December 31, 2021, representing an increase of about 4.7%[55] - The company reported charge-offs of $185,000 for the three months ended March 31, 2022, compared to $272,000 for the same period in 2021, showing a decrease of approximately 31.9%[54] - The company employs a risk rating system for its loan portfolio, with all commercial loans over $250,000 reviewed annually or biannually[56] Securities and Investments - As of March 31, 2022, the amortized cost of available-for-sale securities was $92.855 million, with a fair value of $83.260 million, reflecting a decline of 10.7% from the amortized cost[28] - The gross unrealized losses on available-for-sale securities amounted to $9.647 million as of March 31, 2022, compared to $2.384 million as of December 31, 2021[28] - Thirty-seven out of thirty-nine available-for-sale securities had unrealized losses as of March 31, 2022, indicating a significant number of securities in a loss position[28] - The company believes that none of the losses on available-for-sale securities constitute other-than-temporary impairment, as the losses are considered temporary due to market fluctuations[29] Loan Portfolio Composition - The commercial real estate loan portfolio increased to $413.1 million as of March 31, 2022, up from $365.2 million at the end of 2021, reflecting a growth of 13.1%[34] - The company reported a total of $18.4 million in unsecured consumer loans purchased during Q1 2022, compared to none in Q1 2021[44] - The company's syndicated and leveraged loan portfolio totaled $20.8 million as of March 31, 2022, an increase from $19.6 million at the end of 2021[41] Impaired Loans and TDRs - The total recorded investment in Troubled Debt Restructurings (TDRs) was $10,349,000 as of March 31, 2022, compared to $10,394,000 at the end of 2021, indicating a decrease of 0.4%[70] - The company identified thirty-five impaired loans totaling $24.2 million as of March 31, 2022, with specific reserves of $2.7 million established for twenty-five of these loans[74] - The total allowance for impaired loans was $2,715,000 as of March 31, 2022, compared to $2,299,000 at December 31, 2021, reflecting a 18.1% increase[78] Regulatory and Compliance - The company's Tier 1 leverage ratio was 9.94% as of March 31, 2022, up from 9.86% at December 31, 2021, indicating compliance with the "well capitalized" status under the Community Bank Leverage Ratio framework[121][122] - The company has established credit policies that limit the extension of credit on commercial real estate loans to 75% of the market value of the underlying collateral[35] Miscellaneous - The company incurred $1.9 million in project expenses related to the merger with American Challenger as of March 31, 2022[90] - The company’s goodwill remained unchanged at $1.1 million as of March 31, 2022, with no impairment assessment performed during the quarter[86][88]