Financial Performance - Total interest income for the three months ended March 31, 2024, was $13.5 million, an increase of $5.9 million or 79% compared to the same period in 2023 [111]. - Net interest income for the three months ended March 31, 2024, was $7.8 million, an increase of $2.7 million or 53% compared to the same period in 2023 [111]. - Net earnings for the three months ended March 31, 2024, were $2.4 million or $0.31 per share, compared to $1.2 million or $0.16 per share for the same period in 2023, representing a 106% increase [111]. - Total noninterest income rose to $1.2 million for Q1 2024, up from $729,000 in Q1 2023, driven by increased wire transfer and ACH fees [115]. - Total noninterest expenses increased to $4.7 million for Q1 2024, compared to $3.4 million in Q1 2023, primarily due to employee compensation and benefits, and data processing [115]. Asset and Loan Growth - Total assets increased by approximately $149 million to $941 million at March 31, 2024, from $791 million at December 31, 2023, primarily due to increases in loans and cash equivalents [100]. - Net loans grew by $75 million to $746 million at March 31, 2024, from $671 million at December 31, 2023 [100]. - Deposits increased by approximately $159 million to $798 million at March 31, 2024, from $640 million at December 31, 2023 [100]. - The average yield on loans increased to 6.70% for the three months ended March 31, 2024, compared to 5.35% for the same period in 2023 [109]. - The company plans to limit growth in loans and focus on originating multi-family, non-owner occupied, commercial real estate, and skilled nursing facility loans [95]. Credit Loss and Allowance - Expected credit loss expense increased by $237,000 to $1 million for Q1 2024 compared to Q1 2023, with the allowance for credit losses totaling $8.3 million or 1.10% of loans outstanding [114]. - The net charge-off amount during Q1 2024 was $534,000, resulting from consumer lending activities [114]. - The allowance for credit losses increased from $7.6 million or 1.13% of loans outstanding at December 31, 2023, to $8.3 million or 1.10% at March 31, 2024 [114]. - Management's evaluation of credit loss allowance is based on historical experience, loan volume growth, and economic conditions affecting borrowers [114]. Capital and Stock Issuance - The company issued 2,311,552 shares of common stock in a private placement transaction at a price ranging from $3.90 to $4.25 per share during Q1 2024 [123]. - A total of 525,641 shares of Series C preferred stock were issued for a purchase price of $2,049,999 during Q1 2024, with proceeds used to augment the Bank's regulatory capital ratios [124]. Operational Updates - The company commenced offering U.S. Small Business Administration (SBA) 7A loans, with $1.4 million in loans originated by March 31, 2024 [97]. - The company is investing in technology to improve efficiency in treasury management and electronic funds transfer services [95]. - There were no significant changes in the company's internal control over financial reporting during Q1 2024 [118]. - The company is not currently a party to any material legal proceedings [121].
OptimumBank(OPHC) - 2024 Q1 - Quarterly Report