Patriot National Bancorp(PNBK) - 2024 Q1 - Quarterly Report

Financial Performance - Total interest and dividend income for Q1 2024 was $14,001,000, an increase of 2.6% from $13,646,000 in Q1 2023[14] - Net interest income after provision for credit losses decreased to $4,746,000 in Q1 2024, down 18.1% from $5,793,000 in Q1 2023[14] - Non-interest income surged to $2,247,000 in Q1 2024, a significant increase of 169.5% compared to $835,000 in Q1 2023[14] - The net loss for Q1 2024 was $299,000, an improvement from a net loss of $699,000 in Q1 2023[14] - Basic loss per share improved to $0.08 in Q1 2024 from $0.18 in Q1 2023[14] - The company reported a comprehensive loss of $770,000 for Q1 2024, compared to a comprehensive income of $548,000 in Q1 2023[15] - For the three months ended March 31, 2024, the company reported a net loss attributable to common shareholders of $299,000, resulting in a basic and diluted loss per share of $0.08, compared to a net loss of $699,000 and a loss per share of $0.18 for the same period in 2023[109] Cash and Liquidity - Cash, cash equivalents, and restricted cash at the end of Q1 2024 totaled $92,775,000, up from $60,252,000 at the end of Q1 2023[19] - Net cash provided by operating activities was $1,799,000 in Q1 2024, compared to a net cash used of $212,000 in Q1 2023[19] - Total assets decreased by $20.2 million to $1.07 billion as of March 31, 2024, primarily due to a $38.5 million decline in loans receivable[159] - Cash, cash equivalents, and restricted cash increased from $66.5 million at December 31, 2023, to $92.8 million at March 31, 2024, reflecting a strategy to enhance balance sheet liquidity[160] Loans and Credit Quality - As of March 31, 2024, total loans receivable, net, amounted to $796.5 million, a decrease from $832.9 million as of December 31, 2023, representing a decline of approximately 4.3%[39] - The allowance for loan and lease losses decreased to $13.8 million as of March 31, 2024, from $15.9 million as of December 31, 2023, indicating a reduction of approximately 13.5%[39] - The total loans receivable, gross, was $810,323,000 as of March 31, 2024, compared to $848,859,000 at December 31, 2023[65] - The total allowance for credit losses decreased to $13,777,000 as of March 31, 2024, from $15,925,000 at December 31, 2023[63] - The total past due loans as of March 31, 2024, amounted to $7.735 million, with $783.509 million classified as current[75] - The total performing loans as of March 31, 2024, were $791.244 million, with $19.079 million classified as non-performing[75] - Nonperforming assets increased to $22.4 million as of March 31, 2024, with a nonperforming assets to total assets ratio of 2.09%[168] Deposits and Borrowings - Total deposits increased to $859,724,000 as of March 31, 2024, compared to $840,311,000 as of December 31, 2023[96] - Interest-bearing deposits totaled $750,459,000 as of March 31, 2024, up from $730,255,000 at the end of 2023[96] - Total borrowings decreased from $201.1 million at December 31, 2023, to $161.1 million as of March 31, 2024[176] - FHLB-B advances decreased from $101.0 million at December 31, 2023, to $61.0 million at March 31, 2024[178] Interest Income and Expense - Total interest expense for the three months ended March 31, 2024, was $8.6 million, which increased by $3.0 million from $5.6 million in the same period of 2023[208] - Net interest income decreased to $5.4 million for the three months ended March 31, 2024, down from $8.0 million in the same period of 2023, reflecting a lower loan balance and narrower net interest margin[208] - The net interest margin was 2.20% for the three months ended March 31, 2024, compared to 3.29% for the same period in 2023, primarily due to increased deposit costs and a decline in loan balances[209] Capital Ratios - As of March 31, 2024, the Total Capital ratio for Patriot National Bancorp, Inc. was 9.95%, while Patriot Bank, N.A. reported a ratio of 11.26%[121] - The Tier 1 Capital ratio for Patriot National Bancorp, Inc. was 7.94% as of March 31, 2024, compared to 10.40% for Patriot Bank, N.A.[121] - The Common Equity Tier 1 (CET1) Capital ratio for Patriot National Bancorp, Inc. was 7.03% as of March 31, 2024, while Patriot Bank, N.A. reported a ratio of 10.40%[121] - The Tier 1 Leverage Capital ratio for Patriot National Bancorp, Inc. was 6.53% as of March 31, 2024, compared to 8.55% for Patriot Bank, N.A.[121] Risk Management - The company has established a risk management strategy involving interest rate swaps with commercial lending customers to minimize net risk exposure[98] - The Company’s commercial and industrial loans are subject to risks including cash flow issues and economic downturns[58] - The estimated credit losses for pooled loans are calculated using a model that incorporates probability of default and loss given default[57] Accounting and Regulatory Changes - The company does not expect the adoption of ASU 2023-06 to impact its financial condition or results of operations but may change certain disclosures[27] - The Company adopted the CECL methodology for estimating expected credit losses starting January 1, 2023, impacting the ACL calculations[56] - The company plans to monitor SEC actions regarding recently issued accounting standards and will prepare for their adoption accordingly[27]