United States

Private Bancorp of America, Inc. Announces Record Net Income and Earnings Per Share for First Quarter 2023

First Quarter 2023 Highlights

  • Record net income for the first quarter of 2023 of $9.0 million, up 20.6% from the prior quarter and 38.0% from the first quarter of 2022
  • Record diluted earnings per share for the first quarter of 2023 of $1.57, up 20.1% from the prior quarter and 38.7% from the first quarter of 2022
  • Loans held-for-investment (“HFI”) totaled $1.6 billion as of March 31, 2023, an increase of $35 million or 2.2% from December 31, 2022
  • The Company adopted CECL effective as of January 1, 2023 and the “Day 1” impact was an increase of $1.9 million to the allowance for loan losses, a $974 thousand increase to the reserve for unfunded commitments and a $2.0 million decrease to retained earnings
  • The allowance for loan losses was 1.30% of loans HFI as of March 31, 2023 compared to 1.21% at December 31, 2022. The increase primarily resulted from the adoption of CECL
  • The provision for loan losses for the first quarter of 2023 was $73 thousand, compared to $60 thousand for the prior quarter and $142 thousand for the first quarter of 2022
  • Core deposits for the quarter declined by just $17 million (or 1%) to $1.5 billion, which was comprised of a $52 million decrease in noninterest-bearing deposits (40.4% of total deposits) partially offset by a $35 million increase in interest-bearing deposits, which includes fully insured balances in the Intrafi ICS and CDARS deposit programs. The net decrease in core deposits was impacted by pre-planned and anticipated client transactions (e.g., real estate acquisitions, a significant business acquisition and private placement investments) as well as typical seasonal changes. Furthermore, between March 31, 2023 and April 18, 2023, deposits (excluding brokered deposits and public deposit accounts) increased by $30 million
  • Total deposits were $1.6 billion as of March 31, 2023, a decrease of $91 million, primarily due to $75 million in brokered deposits shifting to lower costing Federal Home Loan Bank advances
  • Uninsured deposits, net of collateralized and fiduciary deposit accounts, represent 51% of total deposits
  • As of March 31, 2023, total available liquidity of $1.4 billion (or 173% of uninsured deposits, net of collateralized and fiduciary deposit accounts). Total available liquidity is comprised of $311 million of on-balance sheet liquidity (cash and investment securities) and $1.1 billion of unused borrowing capacity
  • Net interest margin was 4.90% for the first quarter of 2023, as compared to 5.17% for the prior quarter and 4.65% for the first quarter of 2022
  • Total cost of funding sources increased to 1.39% for the first quarter of 2023, an increase from 0.86% in the prior quarter. Total cost of deposits was 1.23% and 0.79% for the respective periods. The spot rate for deposits was 1.32% at March 31, 2023
  • Tangible book value per share was $26.30 as of March 31, 2023, up from $25.06 at December 31, 2022 as a result of strong earnings, partially offset by the impact of adopting CECL. Tangible book value per share increased 15.4% year-over-year

LA JOLLA, Calif., April 21, 2023 (GLOBE NEWSWIRE) — Private Bancorp of America, Inc. (OTCQX:PBAM), (“Company”) and CalPrivate Bank (“Bank”) announced unaudited financial results for the first fiscal quarter ended March 31, 2023. The Company reported record net income of $9.0 million, or $1.57 per diluted share, for the first quarter of 2023 compared to $6.5 million, or $1.13 per diluted share, for the first quarter of 2022.

Rick Sowers, President and CEO of the Company and the Bank stated, “Our Team continues to focus on what we believe is our value proposition – exceptional service and quality relationship building. While the economic and banking environment was chaotic for all banks in the first quarter, we worked tirelessly to ensure our Clients were comfortable and aware of the strength of our balance sheet. We are proud of our deposit retention in the quarter and remain focused on providing banking Solutions that are of high value to our Clients. We continue to see shifts in the deposit base to interest bearing deposits, as we were expecting. Loan demand has slowed across the industry so we are opportunistically lending across all channels and regions at what we feel are reasonable rates of return.”

Sowers added, “Return on average equity for the first quarter was a record high of 24.8% and we improved our efficiency ratio to 48.9%. We remain focused on credit quality, enterprise risk management, strong liquidity on and off the balance sheet and enhancing shareholder value through managing expense and net interest margin.”

“The Company continues to exhibit successful customer acquisition activity as shown by the growth in loans despite a rising rate environment. Additionally, the Company continues to invest in people and infrastructure, including strong risk management, needed to support the continued growth of the CalPrivate franchise,” said Selwyn Isakow, Chairman of the Board of the Company and the Bank.

Isakow added, “The Board is pleased with CalPrivate’s financial performance in the quarter, and we remain optimistic about management’s ability to react to and successfully navigate the Company during these uncertain times.”

STATEMENT OF INCOME

Net Interest Income

Net interest income for the first quarter of 2023 totaled $22.2 million, a decrease of $428 thousand or 1.9% from the prior quarter and an increase of $5.0 million or 29.3% from the first quarter of 2022. The decrease from the prior quarter was driven primarily by an increase of $2.3 million in interest expense, which resulted from higher funding costs as competitive pressure on deposit rates continued and we carried higher levels of cash liquidity during March that were funded by wholesale borrowings. Partially offsetting this was $1.9 million higher interest income resulting from the increase in average loan balances and higher yield on loans.

Net Interest Margin

The net interest margin for the first quarter of 2023 was 4.90% compared to 5.17% for the prior quarter and 4.65% in the first quarter of 2022. The 27 basis point decrease in net interest margin from the prior quarter was due to higher rates paid on deposits and wholesale borrowings, partially offset by higher rates on new loan originations and variable rate loans and investment securities. The yield on earning assets was 6.19% for the first quarter of 2023 compared with 5.97% for the prior quarter and the cost of total funding sources was 1.39% for the first quarter of 2023 compared to 0.86% in the prior quarter. The cost of deposits was 1.23% for the first quarter of 2023 compared to 0.79% in the prior quarter.

Provision for Loan Losses

The provision for loan losses for the first quarter of 2023 was $73 thousand. For more details, please refer to the “Asset Quality” section below.

Noninterest Income

Noninterest income was $1.5 million for the first quarter of 2023, an increase of $381 thousand from the prior quarter and compared to $3.1 million in the first quarter of 2022. The change from the prior quarter was primarily due to higher gain on sale of SBA loans and the prior quarter included a $304 thousand impairment related to faster prepayments in the SBA portfolio which resulted in accelerated amortization and valuation adjustments to the SBA servicing asset. The decline in noninterest income from the first quarter of 2022 was due to lower gain on sale of SBA loans. SBA loan sales for the first quarter of 2023 were $5.1 million with a 11.2% average trade premium resulting in a net gain on sale of $474 thousand, compared with $11.4 million with a 10.2% average trade premium resulting in a net gain on sale of $792 thousand in the prior quarter.

Noninterest Expense

Noninterest expense was $11.6 million for the first quarter of 2023, a decrease of $1.5 million, or 11.6%, compared to the prior quarter and compared to $10.9 million in the first quarter of 2022. The decrease from the prior quarter was primarily due to lower variable compensation (accruals for commissions and incentives) related to loan and deposit production as well as a decline in professional services (in particular legal expense) related to the active and on-going lawsuit for the recovery of the charged-off loan for the ANI Development, LLC/Gina Champion-Cain fraud case and Chicago Title (parent company, Fidelity National Financial) for its alleged involvement with the fraud scheme. The efficiency ratio was 48.9% for the first quarter of 2023 compared to 55.2% in the prior quarter and 53.5% in the first quarter of 2022.

The Company remains committed to making investments in the business, including technology, marketing, and staffing. Historically high inflation and low unemployment continue to have an impact on rising wages as well as increased costs related to third party service providers, which we proactively monitor and manage.

Provision for Income Tax Expense

Provision for income tax expense was $3.0 million for the first quarter of 2023, compared to $3.1 million for the prior quarter. The effective tax rate for the first quarter of 2023 was 25.2% compared to 29.4% in the prior quarter and 29.7% in the first quarter of 2022. The effective tax rate for the first quarter of 2023 was lower mainly due to discrete tax benefits related to exercised stock options.

STATEMENT OF FINANCIAL CONDITION

The Company reported total assets of $2.0 billion as of March 31, 2023, representing an increase of $112 million or 6.0% since December 31, 2022. The increase in assets was primarily due to higher cash balances, which were funded by an increase in wholesale borrowings (Federal Home Loan Bank advances). Loans HFI totaled $1.6 billion as of March 31, 2023, an increase of $35 million or 2.2% since December 31, 2022. Total deposits were $1.6 billion as of March 31, 2023, a decrease of $91 million since December 31, 2022. The decrease was primarily due to a $75 million decline in brokered deposits, which shifted to lower costing Federal Home Loan Bank advances at quarter end. Additionally, core deposits declined by $17 million, which was comprised of a $52 million decrease in noninterest-bearing deposits partially offset by $35 million increase in interest-bearing deposits, which included balances moving into the Intrafi ICS and CDARS programs. As of March 31, 2023, the net unrealized loss on the available-for-sale (“AFS”) investment securities portfolio, which is comprised mostly of US Treasury and Government Agency debt, was $12.8 million (pre-tax) compared to a loss of $14.4 million as of December 31, 2022. The average duration of the Bank’s AFS portfolio is 3.9 years. The Company has no held-to-maturity securities.

Adoption of the Current Expected Credit Loss (“CECL”) Accounting Standard and Allowance for Credit Losses (“ACL”)

On January 1, 2023, the Company adopted CECL for determining the allowance for credit losses. Upon adoption, we recognized a Day 1 increase of $1.9 million to the allowance for loan losses, a $974 thousand increase to the reserve for unfunded commitments and a $2.0 million decrease to retained earnings. This represented an increase of 14% to the overall ACL.

Asset Quality

As of March 31, 2023, the allowance for loan losses was $21.1 million or 1.30% of loans HFI, compared to 1.21% at December 31, 2022. The increase primarily resulted from the adoption of CECL. The Company continues to have strong credit metrics, there were no loan delinquencies as of March 31, 2023 and no net charge-offs (recoveries) during the quarter. The reserve for unfunded commitments was $2.8 million as of March 31, 2023. Given the credit quality of the loan portfolio, management believes we are sufficiently reserved.

As of March 31, 2023, there are no doubtful credits and classified assets were $14.6 million, down from $15.7 million at December 31, 2022. Total classified assets as of March 31, 2023 consisted of 11 loans, of which 5 loans totaling $8.9 million were secured by real estate with a weighted average LTV of 46.5%. The remaining 6 loans included 5 SBA loans with a balance of $3.2 million where 3 loans were 75% and 2 loans were 90% guaranteed by the SBA.

Capital Ratios (1)

The Bank’s capital ratios were in excess of the levels established for “well capitalized” institutions and are as follows:

  March 31, 2023 (1) Dec 31, 2022
CalPrivate Bank    
Tier I leverage ratio 9.82% 9.52%
Tier I risk-based capital ratio 10.21% 10.10%
Total risk-based capital ratio 11.46% 11.35%

      (1)   March 31, 2023 capital ratios are preliminary and subject to change.

About Private Bancorp of America, Inc.

Private Bancorp of America, Inc. (OTCQX: PBAM), is the holding company for CalPrivate Bank. CalPrivate Bank provides a Distinctly Different banking experience through unparalleled service and creative funding solutions to high-net-worth individuals, professionals, locally owned businesses, and real estate entrepreneurs. Customers are serviced through offices in Coronado, San Diego, La Jolla, Newport Beach, El Segundo and Beverly Hills as well as efficient electronic banking offerings. The Bank also offers various portfolio and government guaranteed lending programs, including SBA and cross-border Export-Import Bank programs. CalPrivate Bank is an SBA Preferred Lender and a Bauer Financial 5-star rated bank.

CalPrivate Bank’s website is www.calprivate.bank.

Non-GAAP Financial Measures

This press release contains certain non-GAAP financial measures in addition to results presented in accordance with GAAP. The Company uses certain non-GAAP financial measures to provide meaningful supplemental information regarding the Company’s results of operations and financial condition and to enhance investors’ overall understanding of such results of operations and financial condition, permit investors to effectively analyze financial trends of our business activities, and enhance comparability with peers across the financial services sector. These non-GAAP financial measures should be considered in addition to, not as a substitute for or superior to, financial measures prepared in accordance with GAAP and should be read in conjunction with the Company’s GAAP financial information. A reconciliation of the most comparable GAAP financial measures to non-GAAP financial measures is included in the accompanying financial tables.

Investor Relations Contacts

Rick Sowers
President and Chief Executive Officer
Private Bancorp of America, Inc., and CalPrivate Bank
(424) 303-4894

Cory Stewart
Executive Vice President and Chief Financial Officer
Private Bancorp of America, Inc., and CalPrivate Bank
(206) 293-3669

Safe Harbor Paragraph

This communication contains expressions of expectations, both implied and explicit, that are “forward-looking statements” within the meaning of such term in the Private Securities Litigation Reform Act of 1995. We caution you that a number of important factors could cause actual results to differ materially from those in the forward-looking statements, especially given the current turmoil in the banking and financial markets. These factors include the effects of depositors withdrawing funds unexpectedly, counterparties being unable to provide liquidity sources that we believe should be available, loan losses, economic conditions and competition in the geographic and business areas in which Private Bancorp of America, Inc. operates, including competition in lending and deposit acquisition, the unpredictability of fee income from participation in SBA loan programs, the effects of bank failures, liquidations and mergers in our markets and nationally, our ability to successfully integrate and develop business through the addition of new personnel, whether our efforts to expand loan, product and service offerings will prove profitable, system failures and data security, whether we can effectively secure and implement new technology solutions, inflation, fluctuations in interest rates, legislation and governmental regulation. You should not place undue reliance on forward-looking statements, and we undertake no obligation to update those statements whether as a result of changes in underlying factors, new information, future events or otherwise. These factors could cause actual results to differ materially from what we anticipate or project. You should not place undue reliance on any such forward-looking statement, which speaks only as of the date on which it was made. Although we in good faith believe the assumptions and bases supporting our forward-looking statements to be reasonable there can be no assurance that those assumptions and bases will prove accurate.

PRIVATE BANCORP OF AMERICA, INC.
CONSOLIDATED BALANCE SHEET
(Unaudited)
(Dollars in thousands)
           
  March 31, 2023   December 31, 2022   March 31, 2022
Assets          
Cash and due from banks $ 13,347     $ 14,495     $ 17,099  
Interest-bearing deposits in other financial institutions   73,420       30,409       40,878  
Interest-bearing deposits at Federal Reserve Bank   125,045       83,738       66,038  
Total cash and due from banks   211,812       128,642       124,015  
Interest-bearing time deposits with other institutions   7,661       7,923       5,817  
Investment securities available for sale   103,790       104,652       114,382  
Loan held for sale   465       7,061       1,999  
Total loans held-for-investment   1,623,028       1,588,248       1,284,838  
Allowance for loan losses   (21,135 )     (19,152 )     (17,117 )
Net loans   1,601,893       1,569,096       1,267,721  
Federal Home Loan Bank stock, at cost   7,020       7,020       4,909  
Right of use asset   2,889       3,265       3,400  
Premises and equipment, net   1,744       1,742       2,813  
Servicing assets, net   3,057       3,007       3,525  
Accrued interest receivable   5,674       5,291       3,453  
Other assets   20,623       17,181       13,448  
Total assets $ 1,966,628     $ 1,854,880     $ 1,545,482  
           
Liabilities and Shareholders’ Equity          
Liabilities          
Noninterest bearing $ 639,664     $ 691,392     $ 724,469  
Interest Bearing   944,102       983,730       646,545  
Total deposits   1,583,766       1,675,122       1,371,014  
FHLB borrowings   192,000             10,000  
Other borrowings   17,956       17,954       17,948  
Accrued interest payable and other liabilities   20,592       18,480       14,630  
Total liabilities   1,814,314       1,711,556       1,413,592  
           
Shareholders’ equity          
Common stock   73,254       72,221       70,899  
Additional paid-in capital   3,289       3,353       3,602  
Retained earnings   84,751       77,810       61,424  
Accumulated other comprehensive (loss) income, net   (8,980 )     (10,060 )     (4,035 )
Total shareholders’ equity   152,314       143,324       131,890  
Total liabilities and shareholders’ equity $ 1,966,628     $ 1,854,880     $ 1,545,482  
           

PRIVATE BANCORP OF AMERICA, INC.
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(Dollars in thousands, except per share amounts)
             
    For the three months ended
    March 31, 2023   December 31, 2022   March 31, 2022
Interest Income            
Loans   $ 26,228   $ 24,717   $ 17,246
Investment securities     580     592     401
Deposits in other financial institutions     1,150     756     134
Total interest income     27,958     26,065     17,781
             
Interest Expense            
Deposits     4,924     3,149     327
Borrowings     866     320     313
Total interest expense     5,790     3,469     640
             
Net interest income     22,168     22,596     17,141
Provision for loan losses     73     60     142
Net interest income after provision for loan losses     22,095     22,536     16,999
             
Noninterest income:            
Service charges on deposit accounts     348     274     281
Net gain on sale of loans     474     792     2,471
Other noninterest income     643     18     357
Total noninterest income     1,465     1,084     3,109
             
Noninterest expense:            
Compensation and employee benefits     8,030     8,482     7,313
Occupancy and equipment     806     820     723
Data processing     944     942     653
Professional services     438     1,018     915
Other expenses     1,339     1,813     1,255
Total noninterest expense     11,557     13,075     10,859
Income before provision for income taxes     12,003     10,545     9,249
Provision for income taxes     3,029     3,102     2,747
Net income   $ 8,974   $ 7,443   $ 6,502
Net income available to common shareholders   $ 8,923   $ 7,394   $ 6,432
             
Earnings per share            
Basic earnings per share   $ 1.59   $ 1.33   $ 1.16
Diluted earnings per share   $ 1.57   $ 1.31   $ 1.13
             
Average shares outstanding     5,608,193     5,551,376     5,568,400
Diluted average shares outstanding     5,673,394     5,645,355     5,672,701

PRIVATE BANCORP OF AMERICA, INC.
Consolidated average balance sheet, interest, yield and rates
(Unaudited)
(Dollars in thousands)
                                     
    For the three months ended
    March 31, 2023   December 31, 2022   March 31, 2022
    Average Balance   Interest   Average Yield/Rate   Average Balance   Interest   Average Yield/Rate   Average Balance   Interest   Average Yield/Rate
Interest-Earnings Assets                                    
Deposits in other financial institutions   $ 123,159   $ 1,150   3.79 %   $ 91,324   $ 756   3.28 %   $ 116,903   $ 134   0.46 %
Investment securities     112,694     580   2.06 %     114,390     592   2.07 %     109,252     401   1.47 %
Loans, including LHFS     1,597,236     26,228   6.66 %     1,527,863     24,717   6.42 %     1,268,695     17,246   5.51 %
Total interest-earning assets     1,833,089     27,958   6.19 %     1,733,577     26,065   5.97 %     1,494,850     17,781   4.82 %
Noninterest-earning assets     24,905             25,627             21,502        
Total Assets   $ 1,857,994           $ 1,759,204           $ 1,516,352        
                                     
Interest-Bearing Liabilities                                    
Interest-bearing transaction accounts     150,708     343   0.92 %     141,030     295   0.83 %     78,557     16   0.08 %
Money market     621,148     2,515   1.64 %     597,670     1,674   1.11 %     498,146     192   0.16 %
Savings deposits     13,912     22   0.64 %     13,444     18   0.53 %     13,523     3   0.09 %
Certificates of deposit     169,213     2,044   4.90 %     101,202     1,162   4.56 %     68,525     116   0.69 %
Total Interest-Bearing Deposits     954,981     4,924   2.09 %     853,346     3,149   1.46 %     658,751     327   0.20 %
                                     
FHLB advances     48,711     594   4.95 %     12,195     112   3.64 %     10,000     41   1.66 %
Other borrowings     17,976     272   6.14 %     18,063     208   4.57 %     17,948     272   6.06 %
Total Interest-Bearing Liabilities     66,687     866   5.27 %     30,258     320   4.20 %     27,948     313   4.54 %
                                     
Noninterest-bearing deposits     669,796             720,656             682,880        
Total Funding Sources     1,691,464     5,790   1.39 %     1,604,260     3,469   0.86 %     1,369,579     640   0.19 %
                                     
Noninterest-bearing liabilities     19,750             13,614             14,301        
Shareholders’ equity     146,778             141,330             132,472        
                                     
Total Liabilities and Shareholders’ Equity   $ 1,857,992           $ 1,759,204           $ 1,516,352        
                                     
Net interest income/spread       $ 22,168   4.80 %       $ 22,596   5.11 %       $ 17,141   4.63 %
Net interest margin           4.90 %           5.17 %           4.65 %

  PRIVATE BANCORP OF AMERICA, INC.
  Condensed Balance Sheets
  (Unaudited)
  (Dollars in thousands, except per share amounts)
  Mar 31, 2023   Dec 31, 2022   Sep 30, 2022   Jun 30, 2022   Mar 31, 2022
Assets                  
Cash and due from banks $ 211,812     $ 128,642     $ 102,173     $ 88,792     $ 124,015  
Interest-bearing time deposits with other institutions   7,661       7,923       6,157       6,157       5,817  
Investment securities   103,790       104,652       107,332       113,565       114,382  
Loans held for sale   465       7,061       7,789       4,460       1,999  
Total loans held-for-investment   1,623,028       1,588,248       1,487,098       1,379,519       1,284,838  
Allowance for loan losses   (21,135 )     (19,152 )     (19,092 )     (17,776 )     (17,117 )
Net loans   1,601,893       1,569,096       1,468,006       1,361,743       1,267,721  
Right of use asset   2,889       3,265       2,669       3,037       3,400  
Premises and equipment, net   1,744       1,742       2,040       2,640       2,813  
Other assets and interest receivable   36,374       32,499       30,735       31,708       25,335  
Total assets $ 1,966,628     $ 1,854,880     $ 1,726,901     $ 1,612,102     $ 1,545,482  
                   
Liabilities and Shareholders’ Equity                  
                   
Liabilities                  
Noninterest Bearing $ 639,664     $ 691,392     $ 763,227     $ 747,006     $ 724,469  
Interest Bearing   944,102       983,730       767,371       693,646       646,545  
Total Deposits   1,583,766       1,675,122       1,530,598       1,440,652       1,371,014  
Borrowings   209,956       17,954       47,952       27,950       27,948  
Accrued interest payable and other liabilities   20,592       18,480       13,417       13,305       14,630  
Total liabilities   1,814,314       1,711,556       1,591,967       1,481,907       1,413,592  
                   
Shareholders’ equity                  
Common stock   73,254       72,221       71,671       71,516       70,899  
Additional paid-in capital   3,289       3,353       3,568       3,368       3,602  
Retained earnings   84,751       77,810       70,386       64,036       61,424  
Accumulated other comprehensive (loss) income   (8,980 )     (10,060 )     (10,691 )     (8,725 )     (4,035 )
Total shareholders’ equity   152,314       143,324       134,934       130,195       131,890  
Total liabilities and shareholders’ equity $ 1,966,628     $ 1,854,880     $ 1,726,901     $ 1,612,102     $ 1,545,482  
                   
Book value per common share $ 26.83     $ 25.60     $ 24.12     $ 23.31     $ 23.42  
Tangible book value per common share $ 26.30     $ 25.06     $ 23.49     $ 22.68     $ 22.80  
Shares outstanding   5,676,017       5,599,025       5,594,380       5,584,465       5,630,993  

  PRIVATE BANCORP OF AMERICA, INC.
  Condensed Statements of Income
  (Unaudited)
  (Dollars in thousands, except per share amounts)
  For the three months ended
  Mar 31, 2023   Dec 31, 2022   Sep 30, 2022   Jun 30, 2022   Mar 31, 2022
Interest income $ 27,958     $ 26,065     $ 21,978     $ 18,706     $ 17,781  
Interest expense   5,790       3,469       1,375       723       640  
Net interest income   22,168       22,596       20,603       17,983       17,141  
Provision for loan losses   73       60       1,316       659       142  
Net interest income after provision for loan losses   22,095       22,536       19,287       17,324       16,999  
                   
Noninterest income   1,465       1,084       1,405       1,442       3,109  
                   
Compensation and employee benefits   8,030       8,482       7,261       7,374       7,313  
Occupancy and equipment   806       820       756       808       723  
Data processing   944       942       993       824       653  
Professional services   438       1,018       1,493       1,835       915  
Other expenses   1,339       1,813       1,224       1,759       1,239  
Total noninterest expense   11,557       13,075       11,727       12,600       10,843  
                   
Income before provision for income taxes   12,003       10,545       8,965       6,166       9,265  
Income taxes   3,029       3,102       2,614       1,769       2,747  
Net income $ 8,974     $ 7,443     $ 6,351     $ 4,397     $ 6,518  
Net income available to common shareholders $ 8,923     $ 7,394     $ 6,306     $ 4,347     $ 6,448  
                   
Earnings per share                  
Basic earnings per share $ 1.59     $ 1.33     $ 1.14     $ 0.78     $ 1.16  
Diluted earnings per share $ 1.57     $ 1.31     $ 1.12     $ 0.77     $ 1.14  
                   
Average shares outstanding   5,608,193       5,551,376       5,549,480       5,543,065       5,568,400  
Diluted average shares outstanding   5,673,394       5,645,355       5,640,841       5,639,282       5,672,701  
                   
  Performance Ratios
  Mar 31, 2023   Dec 31, 2022   Sep 30, 2022   Jun 30, 2022   Mar 31, 2022
ROAA   1.96 %     1.68 %     1.51 %     1.11 %     1.74 %
ROAE   24.80 %     20.89 %     17.41 %     13.28 %     19.95 %
ROATCE(1)   25.32 %     21.41 %     17.84 %     13.64 %     20.48 %
Net interest margin   4.90 %     5.17 %     4.99 %     4.61 %     4.65 %
Net interest spread   4.80 %     5.11 %     4.96 %     4.60 %     4.63 %
Efficiency ratio(1)   48.90 %     55.22 %     53.29 %     64.86 %     53.55 %
Noninterest expense / average assets   2.52 %     2.95 %     2.79 %     2.95 %     2.90 %
                   
(1) Non-GAAP measure. See GAAP to non-GAAP Reconciliation table.            

PRIVATE BANCORP OF AMERICA, INC.
(Unaudited)
                   
  Selected Quarterly Average Balances
  (Dollars in thousands)
  For the three months ended
  Mar 31, 2023   Dec 31, 2022   Sep 30, 2022   Jun 30, 2022   Mar 31, 2022
Total assets $ 1,857,994   $ 1,759,204   $ 1,665,491   $ 1,592,276   $ 1,516,352
Earning assets $ 1,833,089   $ 1,733,577   $ 1,638,026   $ 1,564,662   $ 1,494,850
Total loans, including loans held for sale $ 1,597,236   $ 1,527,863   $ 1,438,489   $ 1,339,095   $ 1,268,695
Total deposits $ 1,624,777   $ 1,574,002   $ 1,482,739   $ 1,419,648   $ 1,341,631
Total shareholders’ equity $ 146,778   $ 141,330   $ 144,727   $ 132,789   $ 132,472
                   
                   
  Loan Balances by Type
  (Dollars in thousands)
  Mar 31, 2023   Dec 31, 2022   Sep 30, 2022   Jun 30, 2022   Mar 31, 2022
Real estate – investor owned $ 472,315   $ 476,404   $ 403,950   $ 390,628   $ 350,152
Real estate – owner occupied   418,788     394,365     382,689     359,270     371,840
Real estate – multifamily   141,783     130,901     136,841     121,693     105,964
Real estate – single family   121,760     118,502     107,728     94,212     89,630
Commercial business   401,277     405,919     394,369     362,410     316,216
Land and construction   64,571     56,153     55,418     44,856     44,856
Consumer   2,534     6,004     6,103     6,450     6,180
Total loans held for investment $ 1,623,028   $ 1,588,248   $ 1,487,098   $ 1,379,519   $ 1,284,838
                   
                   
  Deposits by Type
  (Dollars in thousands)
  Mar 31, 2023   Dec 31, 2022   Sep 30, 2022   Jun 30, 2022   Mar 31, 2022
Noninterest-bearing DDA $ 639,664   $ 691,392   $ 763,227   $ 747,006   $ 724,469
Interest-bearing DDA, excluding brokered   99,988     109,130     95,677     93,405     75,904
Savings & MMA, excluding brokered   637,031     614,991     576,395     518,139     488,547
Time deposits, excluding brokered   77,052     54,887     56,341     67,096     67,089
Total deposits, excluding brokered   1,453,735     1,470,400     1,491,640     1,425,646     1,356,009
Total brokered deposits   130,031     204,722     38,958     15,006     15,005
Total deposits $ 1,583,766   $ 1,675,122   $ 1,530,598   $ 1,440,652   $ 1,371,014
                   

PRIVATE BANCORP OF AMERICA, INC.
(Unaudited)
                   
  Rollforward of Allowance for Credit Losses
  (Dollars in thousands)
  For the three months ended
  Mar 31, 2023   Dec 31, 2022   Sep 30, 2022   Jun 30, 2022   Mar 31, 2022
Allowance for loan losses:                  
Beginning balance $ 19,152     $ 19,092     $ 17,776     $ 17,117     $ 16,975  
Impact of CECL adoption   1,910                          
Provision for loan losses   73       60       1,316       659       142  
Net charge-offs (recoveries)                            
Ending balance   21,135       19,152       19,092       17,776       17,117  
Reserve for unfunded commitments(1)   2,802       1,718       1,674       1,635       1,421  
Total allowance for credit losses $ 23,937     $ 20,870     $ 20,766     $ 19,411     $ 18,538  
                   
(1) Includes $974 thousand related to the impact of CECL adoption on January 1, 2023.        
                   
                   
                   
  Asset Quality
  (Dollars in thousands)
  Mar 31, 2023   Dec 31, 2022   Sep 30, 2022   Jun 30, 2022   Mar 31, 2022
Total loans held-for-investment $ 1,623,028     $ 1,588,248     $ 1,487,098     $ 1,379,519     $ 1,284,838  
Allowance for loan losses $ (21,135 )   $ (19,152 )   $ (19,092 )   $ (17,776 )   $ (17,117 )
30-89 day past due loans $     $     $     $     $  
90+ day past due loans $     $     $     $     $  
Nonaccrual loans $ 4,384     $ 3,880     $ 4,593     $ 1,453     $ 1,453  
NPAs / Assets   0.22 %     0.21 %     0.27 %     0.09 %     0.09 %
NPLs / Total loans held-for-investment & OREO   0.27 %     0.24 %     0.31 %     0.11 %     0.11 %
Net quarterly charge-offs $     $     $     $     $  
Net charge-offs/avg loans (annualized)   0.00 %     0.00 %     0.00 %     0.00 %     0.00 %
Allowance for loan losses to loans HFI   1.30 %     1.21 %     1.28 %     1.29 %     1.33 %
Allowance for loan losses to nonaccrual loans   482.09 %     493.61 %     415.68 %     1223.40 %     1,178.05 %

PRIVATE BANCORP OF AMERICA, INC.
(Unaudited)
                   
The following tables present a reconciliation of non-GAAP financial measures to GAAP measures for: efficiency ratio, pretax pre-provision net revenue, average tangible common equity, return on average tangible common equity. We believe the presentation of certain non-GAAP financial measures provides useful information to assess our consolidated financial condition and consolidated results of operations and to assist investors in evaluating our financial results relative to our peers. These non-GAAP financial measures complement our GAAP reporting and are presented below to provide investors and others with information that we use to manage the business each period. Because not all companies use identical calculations, the presentation of these non-GAAP financial measures may not be comparable to other similarly titled measures used by other companies. These non-GAAP measures should be taken together with the corresponding GAAP measures and should not be considered a substitute of the GAAP measures.
                   
  GAAP to Non-GAAP Reconciliation
  (Dollars in thousands)
                   
  For the three months ended
  Mar 31, 2023   Dec 31, 2022   Sep 30, 2022   Jun 30, 2022   Mar 31, 2022
Efficiency Ratio                  
Noninterest expense $ 11,557     $ 13,075     $ 11,727     $ 12,600     $ 10,843  
Net interest income   22,168       22,596       20,603       17,983       17,141  
Noninterest income   1,465       1,084       1,405       1,442       3,109  
Total net interest income and noninterest income   23,633       23,680       22,008       19,425       20,250  
Efficiency ratio (non-GAAP)   48.90 %     55.22 %     53.29 %     64.86 %     53.55 %
                   
Pretax pre-provision net revenue                  
Net interest income $ 22,168     $ 22,596     $ 20,603     $ 17,983     $ 17,141  
Noninterest income   1,465       1,084       1,405       1,442       3,109  
Total net interest income and noninterest income   23,633       23,680       22,008       19,425       20,250  
Less: Noninterest expense   11,557       13,075       11,727       12,600       10,843  
Pretax pre-provision net revenue (non-GAAP) $ 12,076     $ 10,605     $ 10,281     $ 6,825     $ 9,407  
                   
Return on Average Assets, Average Equity, Average Tangible Equity                
Net income $ 8,974     $ 7,443     $ 6,351     $ 4,397     $ 6,518  
Average assets   1,857,994       1,759,204       1,665,491       1,592,276       1,516,352  
Average shareholders’ equity   146,778       141,330       144,727       132,789       132,472  
Less: Average intangible assets   3,026       3,385       3,599       3,490       3,379  
Average tangible common equity (non-GAAP)   143,752       137,945       141,128       129,299       129,093  
                   
Return on average assets   1.96 %     1.68 %     1.51 %     1.11 %     1.74 %
Return on average equity   24.80 %     20.89 %     17.41 %     13.28 %     19.74 %
Return on average tangible common equity (non-GAAP)   25.32 %     21.41 %     17.85 %     13.64 %     20.25 %
                   
Tangible book value per share                  
Total equity   152,314       143,324       134,934       130,195       131,890  
Less: Total intangible assets   3,057       3,007       3,502       3,515       3,525  
Total tangible equity   149,257       140,317       131,432       126,680       128,365  
Shares outstanding   5,676,017       5,599,025       5,594,380       5,584,465       5,630,993  
Tangible book value per share (non-GAAP) $ 26.30     $ 25.06     $ 23.49     $ 22.68     $ 22.80  

 

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