Preferred Bank (NASDAQ: PFBC), one of the larger
independent California banks, today reported results for the
quarter ended June 30, 2022. Preferred Bank (“the Bank”) reported
net income of $28.1 million or $1.87 per diluted share for the
second quarter of 2022. This represents an increase of $6.6 million
or 30.7% over the same quarter last year and also an increase over
the $26.0 million or $1.74 per share posted in the first quarter of
2022. The primary reasons for the increase compared to the prior
year was an increase in net interest income of $13.1 million or
30.1% primarily driven by higher interest rates on interest-earning
assets, loan growth and in the second quarter of 2021, the Bank
recorded debt extinguishment costs of $614,000. The increase over
the first quarter of 2022 was also due to an increase in net
interest income of $6.4 million or 12.8% partially offset by a
higher provision for credit losses and higher non-interest expense.
Second quarter 2022 highlights:
- Linked quarter loan
growth (Ex-PPP) of 7.4%
- Return on average
assets (“ROA”) of 1.84%
- Return on beginning
equity (“ROBE”) of 18.91%
- Pre-provision,
pre-tax (“PPPT”) ROBE of 28.22% 1
- Efficiency ratio of
29.0%
Li Yu, Chairman and CEO, commented, “We had a record quarter in
terms of; net income, earnings per share, total loans, total
deposits, and net interest income for the second quarter of
2022.
Net income for the quarter was $28.1 million or $1.87 per
diluted share and $54.1 million or $3.61 per diluted share for the
first half of 2022. With our very asset sensitive balance sheet, we
have benefited from the recent interest rate hikes.
Loan growth was $328.6 million or 28.6% annualized. For the
first half of year, loan growth was $495.1 million or 22.4%
annualized. Second quarter loan growth was positively impacted by
reduced pay-offs and stronger origination activities.
Deposits grew $98.3 million or 7.4% annualized in the second
quarter of 2022. For the first six months of 2022, deposit growth
was $182.4 million or 7.0 % annualized. During the latter part of
the quarter, we saw an increased level of competition and we
believe deposit costs will accelerate in the second half of the
year.
With a recession potentially looming ahead, the Bank is very
focused on asset quality. Underwriting standards have been
tightened and we have begun to dive deep into our loan portfolio.
Today, we have not noted any deterioration. In fact, classified
assets and loans past due have improved as of June 30, 2022
compared to earlier quarters.
As for interest rate sensitivity, 87% of the Bank’s loans are
floating or adjustable rate. Many of them have a floor rate
requirement. At June 30, 2022, 74% were fully floating. With the
additional rate hike anticipated, all 87% of our total loan
portfolio will be fully floating at the end of July. Therefore, our
interest income is expected to increase for the remainder of the
year. Hopefully the increase in interest income will more than
enough cover the anticipated deposit cost increase.
The $32 million stock repurchase is progressing as scheduled. As
of June 30, 2022, we have repurchased 192,159 shares of our stock
using $12,971,000. We plan to complete the program in the third
quarter of 2022.”
Results of Operations
Net Interest Income and Net Interest Margin.
Net interest income before provision for credit losses was $56.4
million for the second quarter of 2022. This was an increase from
the $43.4 million recorded in the same quarter last year and also
an increase over the $50.0 million posted in the first quarter of
2022. Rising interest rates and strong loan growth were the primary
drivers of the increase in net interest income over both comparable
quarters. The taxable equivalent margin was 3.77% for the second
quarter of 2022, as compared to 3.42% in the first quarter of 2022
and versus 3.25% for the same period last year.
Noninterest Income. For the second quarter of
2022, noninterest income was $2.6 million compared with $1.6
million for the same quarter last year and compared to $2.3 million
for the first quarter of 2022. The increase compared to last year
was due to a $518,000 increase in letter of credit (“LC”) fees, an
increase in service charges of $199,000 and a $261,000 loss on sale
of loans recorded in the second quarter of last year. The increase
compared to the prior quarter was due to an increase in LC fees of
$396,000 partially offset by a decrease in other income of
$114,000.
Noninterest Expense. Total
noninterest expense was $17.1 million for the second quarter of
2022. This is up compared to the $15.0 million recorded in the same
quarter last year and an increase over the $16.2 million posted in
the first quarter of 2022. Comparing this quarter to the second
quarter of last year; personnel expense increased by $1.4 million
or 13.6%, OREO expense was $463,000 this quarter compared to $0
last year and professional services increased by $386,000 this
quarter. The personnel expense increase was primarily due to new
hires and merit increases. Last year, the Bank did not own any OREO
so this years’ expenses were all an increase. In comparing to the
prior quarter; personnel expense was essentially flat from the
first quarter, OREO expense increased by $447,000 and other expense
increased by $285,000. For the quarter ended June 30, 2022, the
Bank’s efficiency ratio was 29.0%, besting the 30.9% posted last
quarter and also down from the same quarter of last year’s
33.2%.
Income Taxes. The Bank recorded a provision for
income taxes of $10.9 million for the second quarter of 2022. This
represents an effective tax rate (“ETR”) of 28.0% and slightly
below the ETR of 28.5% in both the prior quarter and the same
period last year. The Bank’s ETR will fluctuate slightly from
quarter to quarter within a fairly small range due to the timing of
taxable events throughout the year.
Balance Sheet Summary
Total gross loans at June 30, 2022 were $4.92 billion, an
increase of $495 million or 11.2% over the total of $4.42 billion
as of December 31, 2021. Total deposits increased to $5.41 billion,
an increase of $182 million or 3.5% over the $5.23 billion as of
December 31, 2021. Total assets ended the quarter at $6.23 billion,
an increase of $187 million or 3.1% over the total of $6.05 billion
as of December 31, 2021.
Asset Quality
As of June 30, 2022, nonaccrual loans totaled $10.6 million,
down from $14.8 million as of the end of 2021. In addition, OREO
and repossessed assets totaled $21.4 million as of June 30, 2022.
Total net charge-offs for the second quarter of 2022 were zero as
compared to both $1.2 million in the prior quarter and the same
quarter of 2021.
Allowance for Credit Losses
The provision for credit losses for the second quarter of 2022
was $2.9 million as compared to a reversal of ($250,000) in the
prior quarter and compared to the $0 provision for credit losses
posted in the second quarter of 2021. A consistently improving
economic outlook, among other factors such as credit quality led to
a lower allowance requirement. The Bank’s allowance coverage ratio
now stands at 1.25% of total loans (excluding PPP loans).
Capitalization
As of June 30, 2022, the Bank’s leverage ratio was 9.92%, the
common equity tier 1 capital ratio was 10.61% and the total capital
ratio stood at 14.31%. As of December 31, 2021, the Bank’s leverage
ratio was 9.54%, the common equity tier 1 ratio was 11.26% and the
total risk-based capital ratio was 15.37%.
GAAP –
Non-GAAP Reconciliation -Second quarter 2022
PPPT ROBE |
|
|
|
|
Net Income |
$ |
28,069 |
|
Add: Provision for credit
losses |
|
2,900 |
|
Add: Income tax expense |
|
10,916 |
|
Pre-provision and pre-tax
income |
$ |
41,885 |
|
|
|
Total equity - 3/31/22 |
$ |
595,285 |
|
Pre-provision and pre-tax
ROBE |
|
28.22 |
% |
Conference Call and Webcast
A conference call with simultaneous webcast to discuss Preferred
Bank’s second quarter 2022 financial results will be held tomorrow,
July 21, 2022 at 2:00 p.m. Eastern / 11:00 a.m. Pacific. Interested
participants and investors may access the conference call by
dialing 844-826-3037 (domestic) or 412-317-5182 (international) and
referencing “Preferred Bank.” There will also be a live webcast of
the call available at the Investor Relations section of Preferred
Bank's website at www.preferredbank.com. Web participants are
encouraged to go to the website at least 15 minutes prior to the
start of the call to register, download and install any necessary
audio software.
Preferred Bank's Chairman and Chief Executive Officer Li Yu,
President and Chief Operating Officer Wellington Chen, Chief
Financial Officer Edward J. Czajka, Chief Credit Officer Nick Pi
and Deputy Chief Operating Officer Johnny Hsu will be present to
discuss Preferred Bank's financial results, business highlights and
outlook. After the live webcast, a replay will remain available in
the Investor Relations section of Preferred Bank's website. A
replay of the call will also be available at 877-344-7529
(domestic) or 412-317-0088 (international) through August 4, 2022;
the passcode is 7884414.
About Preferred Bank
Preferred Bank is one of the larger independent commercial banks
headquartered in California. The Bank is chartered by the State of
California, and its deposits are insured by the Federal Deposit
Insurance Corporation, or FDIC, to the maximum extent permitted by
law. The Bank conducts its banking business from its main office in
Los Angeles, California, and through eleven full-service branch
banking offices in California (Alhambra, Century City, City of
Industry, Torrance, Arcadia, Irvine, Diamond Bar, Pico Rivera,
Tarzana and San Francisco (2)) and one branch in Flushing, New
York. In addition, the Bank operates a Loan Production Office in
the Houston, Texas suburb of Sugar Land. Preferred Bank offers a
broad range of deposit and loan products and services to both
commercial and consumer customers. The Bank provides personalized
deposit services as well as real estate finance, commercial loans
and trade finance to small and mid-sized businesses, entrepreneurs,
real estate developers, professionals and high net worth
individuals. Although originally founded as a Chinese-American
Bank, Preferred Bank now derives most of its customers from the
diversified mainstream market but does continue to benefit from the
significant migration to California of ethnic Chinese from China
and other areas of East Asia.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. Such statements include, but are not limited to, statements
about the Bank’s future financial and operating results, the Bank's
plans, objectives, expectations and intentions and other statements
that are not historical facts. Such statements are based upon the
current beliefs and expectations of the Bank’s management and are
subject to significant risks and uncertainties. Actual results may
differ from those set forth in the forward-looking statements. The
following factors, among others, could cause actual results to
differ from those set forth in the forward-looking statements:
changes in economic conditions; changes in the California real
estate market; the loss of senior management and other employees;
natural disasters or recurring energy shortage; changes in interest
rates; competition from other financial services companies;
ineffective underwriting practices; inadequate allowance for loan
and lease losses to cover actual losses; risks inherent in
construction lending; adverse economic conditions in Asia; downturn
in international trade; inability to attract deposits; inability to
raise additional capital when needed or on favorable terms;
inability to manage growth; inadequate communications, information,
operating and financial control systems, technology from fourth
party service providers; the U.S. government’s monetary policies;
government regulation; environmental liability with respect to
properties to which the bank takes title; and the threat of
terrorism. Additional factors that could cause the Bank's results
to differ materially from those described in the forward-looking
statements can be found in the Bank’s 2021 Annual Report on Form
10-K filed with the Federal Deposit Insurance Corporation which can
be found on Preferred Bank’s website. The forward-looking
statements in this press release speak only as of the date of the
press release, and the Bank assumes no obligation to update the
forward-looking statements or to update the reasons why actual
results could differ from those contained in the forward-looking
statements. For additional information about Preferred Bank, please
visit the Bank’s website at www.preferredbank.com.
AT THE COMPANY: |
AT FINANCIAL PROFILES: |
Edward J. Czajka |
Jeffrey Haas |
Executive Vice President |
General Information |
Chief Financial Officer |
(310) 622-8240 |
(213) 891-1188 |
PFBC@finprofiles.com |
PREFERRED BANK |
Condensed Consolidated Statements of
Operations |
(unaudited) |
(in thousands, except for net income per share and
shares) |
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Quarter Ended |
|
June 30, |
|
March 31, |
|
June 30, |
|
2022 |
|
2022 |
|
2021 |
Interest income: |
|
|
|
|
|
Loans, including fees |
$ |
58,541 |
|
|
$ |
52,119 |
|
|
$ |
47,906 |
|
Investment securities |
|
3,972 |
|
|
|
2,886 |
|
|
|
2,548 |
|
Fed funds sold |
|
46 |
|
|
|
19 |
|
|
|
19 |
|
Total interest income |
|
62,559 |
|
|
|
55,024 |
|
|
|
50,473 |
|
|
|
|
|
|
|
Interest expense: |
|
|
|
|
|
Interest-bearing demand |
|
2,448 |
|
|
|
1,431 |
|
|
|
1,530 |
|
Savings |
|
20 |
|
|
|
19 |
|
|
|
18 |
|
Time certificates |
|
2,342 |
|
|
|
2,217 |
|
|
|
3,419 |
|
Subordinated debt |
|
1,325 |
|
|
|
1,325 |
|
|
|
2,145 |
|
Total interest expense |
|
6,135 |
|
|
|
4,992 |
|
|
|
7,112 |
|
Net interest income |
|
56,424 |
|
|
|
50,032 |
|
|
|
43,361 |
|
Provision for (reversal of) credit losses |
|
2,900 |
|
|
|
(250 |
) |
|
|
- |
|
Net interest income after provision for (reversal of) |
|
|
|
|
|
credit losses |
|
53,524 |
|
|
|
50,282 |
|
|
|
43,361 |
|
|
|
|
|
|
|
Noninterest income: |
|
|
|
|
|
Fees & service charges on deposit accounts |
|
723 |
|
|
|
671 |
|
|
|
525 |
|
Letters of credit fee income |
|
1,329 |
|
|
|
933 |
|
|
|
811 |
|
BOLI income |
|
100 |
|
|
|
99 |
|
|
|
98 |
|
Net loss on sale of loans |
|
- |
|
|
|
- |
|
|
|
(261 |
) |
Other income |
|
449 |
|
|
|
563 |
|
|
|
473 |
|
Total noninterest income |
|
2,601 |
|
|
|
2,266 |
|
|
|
1,646 |
|
|
|
|
|
|
|
Noninterest expense: |
|
|
|
|
|
Salary and employee benefits |
|
11,688 |
|
|
|
11,640 |
|
|
|
10,285 |
|
Net occupancy expense |
|
1,441 |
|
|
|
1,422 |
|
|
|
1,429 |
|
Business development and promotion expense |
|
176 |
|
|
|
101 |
|
|
|
117 |
|
Professional services |
|
1,382 |
|
|
|
1,243 |
|
|
|
996 |
|
Office supplies and equipment expense |
|
459 |
|
|
|
489 |
|
|
|
476 |
|
Other real estate owned expense |
|
463 |
|
|
|
16 |
|
|
|
- |
|
Other |
|
1,531 |
|
|
|
1,246 |
|
|
|
1,661 |
|
Total noninterest expense |
|
17,140 |
|
|
|
16,157 |
|
|
|
14,964 |
|
Income before provision for income taxes |
|
38,985 |
|
|
|
36,391 |
|
|
|
30,043 |
|
Income tax expense |
|
10,916 |
|
|
|
10,364 |
|
|
|
8,563 |
|
Net income |
$ |
28,069 |
|
|
$ |
26,027 |
|
|
$ |
21,480 |
|
|
|
|
|
|
|
Dividend and earnings allocated to participating securities |
|
- |
|
|
|
(1 |
) |
|
|
(3 |
) |
Net income available to common shareholders |
$ |
28,069 |
|
|
$ |
26,026 |
|
|
$ |
21,477 |
|
|
|
|
|
|
|
Income per share available to common shareholders |
|
|
|
|
|
Basic |
$ |
1.90 |
|
|
$ |
1.76 |
|
|
$ |
1.44 |
|
Diluted |
$ |
1.87 |
|
|
$ |
1.74 |
|
|
$ |
1.44 |
|
|
|
|
|
|
|
Weighted-average common shares outstanding |
|
|
|
|
|
Basic |
|
14,792,298 |
|
|
|
14,765,337 |
|
|
|
14,954,688 |
|
Diluted |
|
15,006,801 |
|
|
|
14,978,667 |
|
|
|
14,954,688 |
|
|
|
|
|
|
|
Cash dividends per common share |
$ |
0.43 |
|
|
$ |
0.43 |
|
|
$ |
0.38 |
|
|
|
|
|
|
|
PREFERRED BANK |
Condensed Consolidated Statements of
Operations |
(unaudited) |
(in thousands, except for net income per share and
shares) |
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Six Months Ended |
|
|
|
June 30, |
|
June 30, |
|
Change |
|
2022 |
|
2021 |
|
% |
Interest income: |
|
|
|
|
|
Loans, including fees |
$ |
110,660 |
|
|
$ |
97,765 |
|
|
13.2 |
% |
Investment securities |
|
6,858 |
|
|
|
4,825 |
|
|
42.1 |
% |
Fed funds sold |
|
65 |
|
|
|
43 |
|
|
53.2 |
% |
Total interest income |
|
117,583 |
|
|
|
102,633 |
|
|
14.6 |
% |
|
|
|
|
|
|
Interest expense: |
|
|
|
|
|
Interest-bearing demand |
|
3,880 |
|
|
|
2,967 |
|
|
30.8 |
% |
Savings |
|
39 |
|
|
|
37 |
|
|
6.2 |
% |
Time certificates |
|
4,558 |
|
|
|
7,246 |
|
|
-37.1 |
% |
Subordinated debt |
|
2,650 |
|
|
|
3,676 |
|
|
-27.9 |
% |
Total interest expense |
|
11,127 |
|
|
|
13,926 |
|
|
-20.1 |
% |
Net interest income |
|
106,456 |
|
|
|
88,707 |
|
|
20.0 |
% |
Provision for credit losses |
|
2,650 |
|
|
|
1,400 |
|
|
89.3 |
% |
Net interest income after provision for credit losses |
|
103,806 |
|
|
|
87,307 |
|
|
18.9 |
% |
|
|
|
|
|
|
Noninterest income: |
|
|
|
|
|
Fees & service charges on deposit accounts |
|
1,395 |
|
|
|
951 |
|
|
46.7 |
% |
Letters of credit fee income |
|
2,261 |
|
|
|
1,619 |
|
|
39.7 |
% |
BOLI income |
|
199 |
|
|
|
194 |
|
|
2.2 |
% |
Net loss on sale of loans |
|
- |
|
|
|
(640 |
) |
|
-100.0 |
% |
Other income |
|
1,012 |
|
|
|
869 |
|
|
16.5 |
% |
Total noninterest income |
|
4,867 |
|
|
|
2,993 |
|
|
62.6 |
% |
|
|
|
|
|
|
Noninterest expense: |
|
|
|
|
|
Salary and employee benefits |
|
23,328 |
|
|
|
21,408 |
|
|
9.0 |
% |
Net occupancy expense |
|
2,863 |
|
|
|
2,830 |
|
|
1.2 |
% |
Business development and promotion expense |
|
277 |
|
|
|
190 |
|
|
45.8 |
% |
Professional services |
|
2,625 |
|
|
|
1,977 |
|
|
32.8 |
% |
Office supplies and equipment expense |
|
948 |
|
|
|
914 |
|
|
3.8 |
% |
Other |
|
2,777 |
|
|
|
3,297 |
|
|
-15.8 |
% |
Total noninterest expense |
|
33,297 |
|
|
|
30,616 |
|
|
8.8 |
% |
Income before provision for income taxes |
|
75,376 |
|
|
|
59,684 |
|
|
26.3 |
% |
Income tax expense |
|
21,280 |
|
|
|
17,010 |
|
|
25.1 |
% |
Net income |
$ |
54,096 |
|
|
$ |
42,674 |
|
|
26.8 |
% |
|
|
|
|
|
|
Dividend and earnings allocated to participating securities |
$ |
(2 |
) |
|
$ |
(5 |
) |
|
-69.6 |
% |
Net income available to common shareholders |
$ |
54,094 |
|
|
$ |
42,669 |
|
|
26.8 |
% |
|
|
|
|
|
|
Income per share available to common shareholders |
|
|
|
|
|
Basic |
$ |
3.66 |
|
|
$ |
2.85 |
|
|
28.3 |
% |
Diluted |
$ |
3.61 |
|
|
$ |
2.85 |
|
|
26.4 |
% |
|
|
|
|
|
|
Weighted-average common shares outstanding |
|
|
|
|
|
Basic |
|
14,778,892 |
|
|
|
14,952,366 |
|
|
-1.2 |
% |
Diluted |
|
14,990,989 |
|
|
|
14,952,366 |
|
|
0.3 |
% |
|
|
|
|
|
|
Dividends per share |
$ |
0.86 |
|
|
$ |
0.76 |
|
|
13.2 |
% |
|
|
|
|
|
|
PREFERRED BANK |
Condensed Consolidated Statements of Financial
Condition |
(unaudited) |
(in thousands) |
|
|
|
|
|
|
|
|
|
June 30, |
|
December 31, |
|
2022 |
|
2021 |
|
(Unaudited) |
|
(Audited) |
Assets |
|
|
|
Cash and due from banks |
$ |
748,658 |
|
|
$ |
1,030,610 |
|
Fed funds sold |
|
20,000 |
|
|
|
20,000 |
|
Cash and cash equivalents |
|
768,658 |
|
|
|
1,050,610 |
|
|
|
|
|
Securities held to maturity, at amortized cost |
|
12,784 |
|
|
|
13,962 |
|
Securities available-for-sale, at fair value |
|
400,597 |
|
|
|
451,911 |
|
Loans |
|
4,920,141 |
|
|
|
4,424,992 |
|
Less allowance for credit losses |
|
(61,396 |
) |
|
|
(59,969 |
) |
Less amortized deferred loan fees, net |
|
(9,525 |
) |
|
|
(6,316 |
) |
Loans, net |
|
4,849,220 |
|
|
|
4,358,707 |
|
|
|
|
|
Other real estate owned and repossessed assets |
|
21,449 |
|
|
|
- |
|
Customers' liability on acceptances |
|
11,053 |
|
|
|
10,188 |
|
Bank furniture and fixtures, net |
|
9,764 |
|
|
|
10,533 |
|
Bank-owned life insurance |
|
10,221 |
|
|
|
10,088 |
|
Accrued interest receivable |
|
16,241 |
|
|
|
14,646 |
|
Investment in affordable housing partnerships |
|
54,874 |
|
|
|
59,018 |
|
Federal Home Loan Bank stock, at cost |
|
15,000 |
|
|
|
15,000 |
|
Deferred tax assets |
|
36,703 |
|
|
|
26,674 |
|
Operating lease right-of-use assets |
|
21,024 |
|
|
|
21,969 |
|
Other assets |
|
5,453 |
|
|
|
2,997 |
|
Total assets |
$ |
6,233,041 |
|
|
$ |
6,046,303 |
|
|
|
|
|
Liabilities and Shareholders' Equity |
|
|
|
Deposits: |
|
|
|
Non-interest bearing demand deposits |
$ |
1,385,934 |
|
|
$ |
1,305,692 |
|
Interest-bearing deposits: |
|
2,239,501 |
|
|
|
2,032,819 |
|
Savings |
|
39,784 |
|
|
|
37,839 |
|
Time certificates of $250,000 or more |
|
870,376 |
|
|
|
934,444 |
|
Other time certificates |
|
872,357 |
|
|
|
914,717 |
|
Total deposits |
|
5,407,952 |
|
|
|
5,225,511 |
|
|
|
|
|
Acceptances outstanding |
|
11,053 |
|
|
|
10,188 |
|
Subordinated debt issuance, net |
|
147,877 |
|
|
|
147,758 |
|
Commitments to fund investment in affordable housing
partnerships |
|
20,036 |
|
|
|
22,606 |
|
Operating lease liabilities |
|
21,115 |
|
|
|
22,861 |
|
Accrued interest payable |
|
752 |
|
|
|
715 |
|
Other liabilities |
|
32,664 |
|
|
|
29,946 |
|
Total liabilities |
|
5,641,449 |
|
|
|
5,459,585 |
|
|
|
|
|
Shareholders' equity |
|
591,592 |
|
|
|
586,718 |
|
Total liabilities and shareholders' equity |
$ |
6,233,041 |
|
|
$ |
6,046,303 |
|
|
|
|
|
Book value per common share |
$ |
40.44 |
|
|
$ |
39.97 |
|
Number of common shares outstanding |
|
14,628,942 |
|
|
|
14,679,769 |
|
|
|
|
|
|
|
|
|
PREFERRED BANK |
Selected Consolidated Financial Information |
(unaudited) |
(in thousands, except for ratios) |
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Quarter Ended |
|
|
|
|
|
|
|
June 30, |
March 31, |
December 31, |
September 30, |
June 30, |
|
2022 |
2022 |
2021 |
2021 |
2021 |
Unaudited historical quarterly operations
data: |
|
|
|
|
|
Interest income |
$ |
62,559 |
|
$ |
55,024 |
|
$ |
54,791 |
|
$ |
53,611 |
|
$ |
50,473 |
|
Interest expense |
|
6,135 |
|
|
4,992 |
|
|
5,374 |
|
|
5,858 |
|
|
7,112 |
|
Interest income before provision for credit losses |
|
56,424 |
|
|
50,032 |
|
|
49,417 |
|
|
47,753 |
|
|
43,361 |
|
(Reversal of) provision for credit losses |
|
2,900 |
|
|
(250 |
) |
|
(900 |
) |
|
(1,500 |
) |
|
- |
|
Noninterest income |
|
2,601 |
|
|
2,266 |
|
|
1,966 |
|
|
2,784 |
|
|
1,646 |
|
Noninterest expense |
|
17,140 |
|
|
16,157 |
|
|
14,806 |
|
|
15,370 |
|
|
14,964 |
|
Income tax expense |
|
10,916 |
|
|
10,364 |
|
|
11,056 |
|
|
10,522 |
|
|
8,563 |
|
Net income |
$ |
28,069 |
|
$ |
26,027 |
|
$ |
26,421 |
|
$ |
26,145 |
|
$ |
21,480 |
|
|
|
|
|
|
|
Earnings per share |
|
|
|
|
|
Basic |
$ |
1.90 |
|
$ |
1.76 |
|
$ |
1.80 |
|
$ |
1.76 |
|
$ |
1.44 |
|
Diluted |
$ |
1.87 |
|
$ |
1.74 |
|
$ |
1.80 |
|
$ |
1.76 |
|
$ |
1.44 |
|
|
|
|
|
|
|
Ratios for the period: |
|
|
|
|
|
Return on average assets |
|
1.84 |
% |
|
1.75 |
% |
|
1.72 |
% |
|
1.80 |
% |
|
1.58 |
% |
Return on beginning equity |
|
18.91 |
% |
|
17.99 |
% |
|
18.65 |
% |
|
18.56 |
% |
|
15.98 |
% |
Net interest margin (Fully-taxable equivalent) |
|
3.77 |
% |
|
3.42 |
% |
|
3.28 |
% |
|
3.36 |
% |
|
3.25 |
% |
Noninterest expense to average assets |
|
1.12 |
% |
|
1.08 |
% |
|
0.97 |
% |
|
1.06 |
% |
|
1.10 |
% |
Efficiency ratio |
|
29.04 |
% |
|
30.89 |
% |
|
28.82 |
% |
|
30.41 |
% |
|
33.25 |
% |
Net charge-offs to average loans (annualized) |
|
0.00 |
% |
|
0.11 |
% |
|
0.03 |
% |
|
0.10 |
% |
|
0.12 |
% |
|
|
|
|
|
|
Ratios as of period end: |
|
|
|
|
|
Tier 1 leverage capital ratio |
|
9.92 |
% |
|
9.92 |
% |
|
9.54 |
% |
|
9.64 |
% |
|
10.07 |
% |
Common equity tier 1 risk-based capital ratio |
|
10.61 |
% |
|
11.20 |
% |
|
11.26 |
% |
|
11.19 |
% |
|
11.28 |
% |
Tier 1 risk-based capital ratio |
|
10.61 |
% |
|
11.20 |
% |
|
11.26 |
% |
|
11.19 |
% |
|
11.28 |
% |
Total risk-based capital ratio |
|
14.31 |
% |
|
15.12 |
% |
|
15.37 |
% |
|
15.47 |
% |
|
15.61 |
% |
Allowances for credit losses to loans at end of period |
|
1.25 |
% |
|
1.27 |
% |
|
1.36 |
% |
|
1.41 |
% |
|
1.49 |
% |
Allowance for credit losses to non-performing loans |
|
5.27x |
|
|
27.15x |
|
|
4.05x |
|
|
2.93x |
|
|
2.91x |
|
|
|
|
|
|
|
Average balances: |
|
|
|
|
|
Total securities |
$ |
430,203 |
|
$ |
455,899 |
|
$ |
470,811 |
|
$ |
401,641 |
|
$ |
269,000 |
|
Total loans |
|
4,777,353 |
|
|
4,367,095 |
|
|
4,218,699 |
|
|
4,156,289 |
|
|
4,130,190 |
|
Total earning assets |
|
6,008,024 |
|
|
5,938,519 |
|
|
5,984,055 |
|
|
5,659,678 |
|
|
5,364,598 |
|
Total assets |
|
6,133,703 |
|
|
6,044,155 |
|
|
6,079,934 |
|
|
5,760,056 |
|
|
5,467,678 |
|
Total time certificate of deposits |
|
1,810,886 |
|
|
1,869,654 |
|
|
1,915,116 |
|
|
1,959,514 |
|
|
1,893,247 |
|
Total interest bearing deposits |
|
3,982,888 |
|
|
3,947,616 |
|
|
3,945,275 |
|
|
3,783,704 |
|
|
3,704,771 |
|
Total deposits |
|
5,301,370 |
|
|
5,215,810 |
|
|
5,277,507 |
|
|
4,971,607 |
|
|
4,724,104 |
|
Total interest bearing liabilities |
|
4,130,729 |
|
|
4,095,399 |
|
|
4,093,002 |
|
|
3,931,375 |
|
|
3,815,964 |
|
Total equity |
|
606,260 |
|
|
597,214 |
|
|
576,495 |
|
|
569,624 |
|
|
553,561 |
|
|
|
|
|
|
|
PREFERRED BANK |
Selected Consolidated Financial Information |
(unaudited) |
(in thousands, except for ratios) |
|
|
|
|
|
|
|
|
|
For the Six Months Ended |
|
June 30, |
|
June 30, |
|
2022 |
|
2021 |
|
|
|
|
Interest income |
$ |
117,583 |
|
|
$ |
102,633 |
|
Interest expense |
|
11,127 |
|
|
|
13,926 |
|
Interest income before provision for credit losses |
|
106,456 |
|
|
|
88,707 |
|
Provision for credit losses |
|
2,650 |
|
|
|
1,400 |
|
Non-interest income |
|
4,867 |
|
|
|
2,993 |
|
Non-interest expense |
|
33,297 |
|
|
|
30,616 |
|
Income tax expense |
|
21,280 |
|
|
|
17,010 |
|
Net income |
$ |
54,096 |
|
|
$ |
42,674 |
|
|
|
|
|
Earnings per share |
|
|
|
Basic |
$ |
3.66 |
|
|
$ |
2.85 |
|
Diluted |
$ |
3.61 |
|
|
$ |
2.85 |
|
|
|
|
|
Ratios for the period: |
|
|
|
Return on average assets |
|
1.79 |
% |
|
|
1.61 |
% |
Return on beginning equity |
|
18.59 |
% |
|
|
16.38 |
% |
Net interest margin (Fully-taxable equivalent) |
|
3.60 |
% |
|
|
3.43 |
% |
Non-interest expense to average assets |
|
1.10 |
% |
|
|
1.16 |
% |
Efficiency ratio |
|
29.91 |
% |
|
|
33.39 |
% |
Net charge-offs to average loans |
|
0.05 |
% |
|
|
0.06 |
% |
|
|
|
|
Average balances: |
|
|
|
Total securities |
$ |
442,981 |
|
|
$ |
255,675 |
|
Total loans |
|
4,573,357 |
|
|
|
4,087,731 |
|
Total earning assets |
|
5,973,364 |
|
|
|
5,234,170 |
|
Total assets |
|
6,089,176 |
|
|
|
5,334,618 |
|
Total time certificate of deposits |
|
1,840,108 |
|
|
|
1,857,055 |
|
Total interest-bearing deposits |
|
3,965,349 |
|
|
|
3,618,543 |
|
Total deposits |
|
5,258,826 |
|
|
|
4,605,908 |
|
Total interest-bearing liabilities |
|
4,113,161 |
|
|
|
3,723,846 |
|
Total equity |
|
601,762 |
|
|
|
545,964 |
|
|
|
|
|
PREFERRED BANK |
Selected Consolidated Financial Information |
(unaudited) |
(in thousands, except for ratios) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of |
|
|
|
|
|
|
|
|
|
|
|
June 30, |
|
March 31, |
|
December 31, |
|
September 30, |
|
June 30, |
|
2022 |
|
2022 |
|
2021 |
|
2021 |
|
2021 |
Unaudited quarterly statement of financial position
data: |
|
|
|
|
|
|
|
|
|
Assets: |
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
$ |
768,658 |
|
|
$ |
985,162 |
|
|
$ |
1,050,610 |
|
|
$ |
1,082,634 |
|
|
$ |
896,474 |
|
Securities held-to-maturity, at amortized cost |
|
12,784 |
|
|
|
13,496 |
|
|
|
13,962 |
|
|
|
15,294 |
|
|
|
15,749 |
|
Securities available-for-sale, at fair value |
|
400,597 |
|
|
|
430,280 |
|
|
|
451,911 |
|
|
|
461,356 |
|
|
|
278,460 |
|
Loans: |
|
|
|
|
|
|
|
|
|
Real estate – Mortgage: |
|
|
|
|
|
|
|
|
|
Real estate—Residential |
$ |
581,412 |
|
|
$ |
539,614 |
|
|
$ |
536,286 |
|
|
$ |
540,725 |
|
|
$ |
558,147 |
|
Real estate—Commercial |
|
2,583,484 |
|
|
|
2,367,862 |
|
|
|
2,267,063 |
|
|
|
2,093,692 |
|
|
|
2,019,995 |
|
Total Real Estate – Mortgage |
|
3,164,896 |
|
|
|
2,907,476 |
|
|
|
2,803,349 |
|
|
|
2,634,417 |
|
|
|
2,578,142 |
|
Real estate – Construction: |
|
|
|
|
|
|
|
|
|
R/E Construction — Residential |
|
168,420 |
|
|
|
141,218 |
|
|
|
130,842 |
|
|
|
122,382 |
|
|
|
120,363 |
|
R/E Construction — Commercial |
|
203,217 |
|
|
|
209,726 |
|
|
|
202,482 |
|
|
|
213,833 |
|
|
|
224,323 |
|
Total real estate construction loans |
|
371,637 |
|
|
|
350,944 |
|
|
|
333,324 |
|
|
|
336,215 |
|
|
|
344,686 |
|
Commercial and industrial |
|
1,336,631 |
|
|
|
1,300,478 |
|
|
|
1,245,734 |
|
|
|
1,286,995 |
|
|
|
1,259,668 |
|
PPP |
|
22,186 |
|
|
|
32,554 |
|
|
|
42,467 |
|
|
|
63,897 |
|
|
|
95,765 |
|
Consumer and others |
|
24,791 |
|
|
|
115 |
|
|
|
118 |
|
|
|
6 |
|
|
|
143 |
|
Gross loans |
|
4,920,141 |
|
|
|
4,591,567 |
|
|
|
4,424,992 |
|
|
|
4,321,529 |
|
|
|
4,278,403 |
|
Allowance for credit losses on loans |
|
(61,396 |
) |
|
|
(58,496 |
) |
|
|
(59,969 |
) |
|
|
(61,135 |
) |
|
|
(63,635 |
) |
Net deferred loan fees |
|
(9,525 |
) |
|
|
(8,573 |
) |
|
|
(6,316 |
) |
|
|
(5,498 |
) |
|
|
(5,329 |
) |
Net loans |
$ |
4,849,220 |
|
|
$ |
4,524,498 |
|
|
$ |
4,358,707 |
|
|
$ |
4,254,896 |
|
|
$ |
4,209,439 |
|
|
|
|
|
|
|
|
|
|
|
Other real estate owned and repossessed assets |
$ |
21,449 |
|
|
$ |
15,547 |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
- |
|
Investment in affordable housing partnerships |
|
54,874 |
|
|
|
56,946 |
|
|
|
59,018 |
|
|
|
53,399 |
|
|
|
55,452 |
|
Federal Home Loan Bank stock, at cost |
|
15,000 |
|
|
|
15,000 |
|
|
|
15,000 |
|
|
|
15,000 |
|
|
|
15,000 |
|
Other assets |
|
110,459 |
|
|
|
101,427 |
|
|
|
97,095 |
|
|
|
97,261 |
|
|
|
105,334 |
|
Total assets |
$ |
6,233,041 |
|
|
$ |
6,142,356 |
|
|
$ |
6,046,303 |
|
|
$ |
5,979,840 |
|
|
$ |
5,575,908 |
|
|
|
|
|
|
|
|
|
|
|
Liabilities: |
|
|
|
|
|
|
|
|
|
Deposits: |
|
|
|
|
|
|
|
|
|
Demand |
$ |
1,385,934 |
|
|
$ |
1,251,613 |
|
|
$ |
1,305,692 |
|
|
$ |
1,349,114 |
|
|
$ |
1,063,472 |
|
Interest-bearing demand |
|
2,239,501 |
|
|
|
2,159,178 |
|
|
|
2,032,819 |
|
|
|
1,861,334 |
|
|
|
1,774,668 |
|
Savings |
|
39,784 |
|
|
|
39,946 |
|
|
|
37,839 |
|
|
|
33,417 |
|
|
|
32,560 |
|
Time certificates of $250,000 or more |
|
870,376 |
|
|
|
924,317 |
|
|
|
934,444 |
|
|
|
959,826 |
|
|
|
930,976 |
|
Other time certificates |
|
872,357 |
|
|
|
934,615 |
|
|
|
914,717 |
|
|
|
990,228 |
|
|
|
994,630 |
|
Total deposits |
$ |
5,407,952 |
|
|
$ |
5,309,669 |
|
|
$ |
5,225,511 |
|
|
$ |
5,193,919 |
|
|
$ |
4,796,306 |
|
|
|
|
|
|
|
|
|
|
|
Acceptances outstanding |
$ |
11,053 |
|
|
$ |
8,222 |
|
|
$ |
10,188 |
|
|
$ |
7,697 |
|
|
$ |
7,797 |
|
Subordinated debt issuance, net |
|
147,877 |
|
|
|
147,818 |
|
|
|
147,758 |
|
|
|
147,699 |
|
|
|
147,787 |
|
Commitments to fund investment in affordable housing
partnerships |
|
20,036 |
|
|
|
22,606 |
|
|
|
22,606 |
|
|
|
17,900 |
|
|
|
19,197 |
|
Other liabilities |
|
54,531 |
|
|
|
58,756 |
|
|
|
53,522 |
|
|
|
50,604 |
|
|
|
45,852 |
|
Total liabilities |
$ |
5,641,449 |
|
|
$ |
5,547,071 |
|
|
$ |
5,459,585 |
|
|
$ |
5,417,819 |
|
|
$ |
5,016,939 |
|
|
|
|
|
|
|
|
|
|
|
Equity: |
|
|
|
|
|
|
|
|
|
Net common stock, no par value |
$ |
197,997 |
|
|
$ |
209,065 |
|
|
$ |
208,840 |
|
|
$ |
203,844 |
|
|
$ |
219,958 |
|
Retained earnings |
|
414,393 |
|
|
|
392,610 |
|
|
|
372,952 |
|
|
|
352,843 |
|
|
|
332,276 |
|
Accumulated other comprehensive income |
|
(20,798 |
) |
|
|
(6,390 |
) |
|
|
4,926 |
|
|
|
5,334 |
|
|
|
6,735 |
|
Total shareholders' equity |
$ |
591,592 |
|
|
$ |
595,285 |
|
|
$ |
586,718 |
|
|
$ |
562,021 |
|
|
$ |
558,969 |
|
Total liabilities and shareholders' equity |
$ |
6,233,041 |
|
|
$ |
6,142,356 |
|
|
$ |
6,046,303 |
|
|
$ |
5,979,840 |
|
|
$ |
5,575,908 |
|
|
|
|
|
|
|
|
|
|
|
PREFERRED BANK |
Quarter-to-Date Average Balances, Yield and
Rates |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended June 30, |
|
Three months ended March 31, |
|
Three months ended June 30, |
|
2022 |
|
2022 |
|
2021 |
|
|
Interest |
Average |
|
|
Interest |
Average |
|
|
Interest |
Average |
|
Average |
Income or |
Yield/ |
|
Average |
Income or |
Yield/ |
|
Average |
Income or |
Yield/ |
|
Balance |
Expense |
Rate |
|
Balance |
Expense |
Rate |
|
Balance |
Expense |
Rate |
ASSETS |
(Dollars in thousands) |
Interest-earning assets: |
|
|
|
|
|
|
|
|
|
|
|
Loans (1,2) |
$ |
4,777,353 |
|
|
58,541 |
|
4.92 |
% |
|
$ |
4,367,095 |
|
$ |
52,119 |
|
4.84 |
% |
|
|
4,132,451 |
|
$ |
47,906 |
|
4.65 |
% |
Investment securities (3) |
|
430,203 |
|
|
2,370 |
|
2.21 |
% |
|
|
455,899 |
|
|
2,224 |
|
1.98 |
% |
|
|
269,000 |
|
|
2,058 |
|
3.07 |
% |
Federal funds sold |
|
20,088 |
|
|
46 |
|
0.92 |
% |
|
|
20,122 |
|
|
19 |
|
0.38 |
% |
|
|
20,437 |
|
|
19 |
|
0.36 |
% |
Other earning assets |
|
780,380 |
|
|
1,708 |
|
0.88 |
% |
|
|
1,095,403 |
|
|
770 |
|
0.29 |
% |
|
|
942,710 |
|
|
597 |
|
0.25 |
% |
Total interest-earning assets |
|
6,008,024 |
|
|
62,665 |
|
4.18 |
% |
|
|
5,938,519 |
|
|
55,132 |
|
3.77 |
% |
|
|
5,364,598 |
|
|
50,580 |
|
3.78 |
% |
Deferred loan fees, net |
|
(9,084 |
) |
|
|
|
|
(6,322 |
) |
|
|
|
|
(4,924 |
) |
|
|
Allowance for credit losses on loans |
|
(58,568 |
) |
|
|
|
|
(59,951 |
) |
|
|
|
|
(64,842 |
) |
|
|
Non-interest earning
assets: |
|
|
|
|
|
|
|
|
|
|
|
Cash and due from banks |
|
11,363 |
|
|
|
|
|
11,589 |
|
|
|
|
|
10,620 |
|
|
|
Bank furniture and fixtures |
|
10,028 |
|
|
|
|
|
10,440 |
|
|
|
|
|
11,468 |
|
|
|
Right of use assets |
|
21,287 |
|
|
|
|
|
21,754 |
|
|
|
|
|
19,735 |
|
|
|
Other assets |
|
150,653 |
|
|
|
|
|
128,126 |
|
|
|
|
|
131,023 |
|
|
|
Total assets |
$ |
6,133,703 |
|
|
|
|
$ |
6,044,155 |
|
|
|
|
$ |
5,467,678 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing liabilities: |
|
|
|
|
|
|
|
|
|
|
|
Deposits: |
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing demand and savings |
|
2,172,002 |
|
$ |
2,468 |
|
0.46 |
% |
|
|
2,077,962 |
|
$ |
1,450 |
|
0.28 |
% |
|
$ |
1,811,524 |
|
$ |
1,548 |
|
0.34 |
% |
TCD $250K or more |
|
892,410 |
|
|
1,211 |
|
0.54 |
% |
|
|
929,170 |
|
|
1,027 |
|
0.45 |
% |
|
|
926,161 |
|
|
1,688 |
|
0.73 |
% |
Other time certificates |
|
918,476 |
|
|
1,131 |
|
0.49 |
% |
|
|
940,484 |
|
|
1,190 |
|
0.51 |
% |
|
|
967,086 |
|
|
1,731 |
|
0.72 |
% |
Total interest-bearing deposits |
|
3,982,888 |
|
|
4,810 |
|
0.48 |
% |
|
|
3,947,616 |
|
|
3,667 |
|
0.38 |
% |
|
|
3,704,771 |
|
|
4,967 |
|
0.54 |
% |
Subordinated debt, net |
|
147,841 |
|
|
1,325 |
|
3.59 |
% |
|
|
147,783 |
|
|
1,325 |
|
3.64 |
% |
|
|
111,193 |
|
|
2,145 |
|
7.74 |
% |
Total interest-bearing liabilities |
|
4,130,729 |
|
|
6,135 |
|
0.60 |
% |
|
|
4,095,399 |
|
|
4,992 |
|
0.49 |
% |
|
|
3,815,964 |
|
|
7,112 |
|
0.75 |
% |
Non-interest bearing liabilities: |
|
|
|
|
|
|
|
|
|
|
|
Demand deposits |
|
1,318,482 |
|
|
|
|
|
1,268,194 |
|
|
|
|
|
1,019,333 |
|
|
|
Lease Liability |
|
21,602 |
|
|
|
|
|
22,463 |
|
|
|
|
|
21,765 |
|
|
|
Other liabilities |
|
56,630 |
|
|
|
|
|
60,885 |
|
|
|
|
|
57,055 |
|
|
|
Total liabilities |
|
5,527,443 |
|
|
|
|
|
5,446,941 |
|
|
|
|
|
4,914,117 |
|
|
|
Shareholders’ equity |
|
606,260 |
|
|
|
|
|
597,214 |
|
|
|
|
|
553,561 |
|
|
|
Total liabilities and shareholders’ equity |
$ |
6,133,703 |
|
|
|
|
$ |
6,044,155 |
|
|
|
|
$ |
5,467,678 |
|
|
|
Net interest income |
|
$ |
56,530 |
|
|
|
|
$ |
50,140 |
|
|
|
|
$ |
43,468 |
|
|
Net interest spread |
|
|
3.59 |
% |
|
|
|
3.27 |
% |
|
|
|
3.03 |
% |
Net interest margin |
|
|
3.77 |
% |
|
|
|
3.42 |
% |
|
|
|
3.25 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Cost of Deposits: |
|
|
|
|
|
|
|
|
|
|
|
Non-interest bearing demand deposits |
$ |
1,318,482 |
|
|
|
|
$ |
1,268,194 |
|
|
|
|
$ |
1,019,333 |
|
|
|
Interest-bearing deposits |
|
3,982,888 |
|
|
4,810 |
|
0.48 |
% |
|
|
3,947,616 |
|
|
3,667 |
|
0.38 |
% |
|
|
3,704,771 |
|
|
4,967 |
|
0.54 |
% |
Total Deposits |
$ |
5,301,370 |
|
$ |
4,810 |
|
0.36 |
% |
|
$ |
5,215,810 |
|
$ |
3,667 |
|
0.29 |
% |
|
$ |
4,724,104 |
|
$ |
4,967 |
|
0.42 |
% |
|
|
|
|
|
|
|
|
|
|
______________________________(1) Includes non-accrual loans and
loans held for sale(2) Net loan fee income of $442,000, $765,000
and $669,000 for the quarter ended June 30, 2022, March 31, 2022,
and June 30, 2021, respectively, are included in the yield
computations(3) Yields on securities have been adjusted to a
tax-equivalent basis
PREFERRED BANK |
Year-to-Date Average Balances, Yield and
Rates |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended June 30, |
|
2022 |
|
2021 |
|
|
Interest |
Average |
|
|
Interest |
Average |
|
Average |
Income or |
Yield/ |
|
Average |
Income or |
Yield/ |
|
Balance |
Expense |
Rate |
|
Balance |
Expense |
Rate |
ASSETS |
(Dollars in thousands) |
Interest-earning assets: |
|
|
|
|
|
|
|
Loans (1,2) |
$ |
4,573,357 |
|
$ |
110,660 |
|
4.88 |
% |
|
$ |
4,088,879 |
|
$ |
97,765 |
|
4.82 |
% |
Investment securities (3) |
|
442,981 |
|
|
4,594 |
|
2.09 |
% |
|
|
255,675 |
|
|
3,942 |
|
3.11 |
% |
Federal funds sold |
|
20,105 |
|
|
65 |
|
0.65 |
% |
|
|
20,953 |
|
|
43 |
|
0.41 |
% |
Other earning assets |
|
936,921 |
|
|
2,478 |
|
0.53 |
% |
|
|
868,663 |
|
|
1,090 |
|
0.25 |
% |
Total interest-earning assets |
|
5,973,364 |
|
|
117,797 |
|
3.98 |
% |
|
|
5,234,170 |
|
|
102,840 |
|
3.96 |
% |
Deferred loan fees, net |
|
(7,710 |
) |
|
|
|
|
(4,636 |
) |
|
|
Allowance for credit losses on loans |
|
(59,255 |
) |
|
|
|
|
(64,150 |
) |
|
|
Non-interest earning assets: |
|
|
|
|
|
|
|
Cash and due from banks |
|
11,474 |
|
|
|
|
|
10,273 |
|
|
|
Bank furniture and fixtures |
|
10,233 |
|
|
|
|
|
11,619 |
|
|
|
Right of use assets |
|
21,519 |
|
|
|
|
|
18,299 |
|
|
|
Other assets |
|
139,550 |
|
|
|
|
|
129,042 |
|
|
|
Total assets |
$ |
6,089,176 |
|
|
|
|
$ |
5,334,618 |
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|
|
|
|
|
|
|
Interest-bearing liabilities: |
|
|
|
|
|
|
|
Deposits: |
|
|
|
|
|
|
|
Interest-bearing demand/ savings |
|
2,125,241 |
|
$ |
3,919 |
|
0.37 |
% |
|
|
1,761,488 |
|
$ |
3,004 |
|
0.34 |
% |
TCD $250K or more |
|
910,689 |
|
|
2,238 |
|
0.50 |
% |
|
|
922,677 |
|
|
3,606 |
|
0.79 |
% |
Other time certificates |
|
929,419 |
|
|
2,320 |
|
0.50 |
% |
|
|
934,378 |
|
|
3,640 |
|
0.79 |
% |
Total interest-bearing deposits |
|
3,965,349 |
|
|
8,477 |
|
0.43 |
% |
|
|
3,618,543 |
|
|
10,250 |
|
0.57 |
% |
Subordinated debt, net |
|
147,812 |
|
|
2,650 |
|
3.62 |
% |
|
|
105,303 |
|
|
3,676 |
|
7.04 |
% |
Total interest-bearing liabilities |
|
4,113,161 |
|
|
11,127 |
|
0.55 |
% |
|
|
3,723,846 |
|
|
13,926 |
|
0.75 |
% |
Non-interest bearing liabilities: |
|
|
|
|
|
|
|
Demand deposits |
|
1,293,477 |
|
|
|
|
|
987,365 |
|
|
|
Lease Liability |
|
22,030 |
|
|
|
|
|
20,534 |
|
|
|
Other liabilities |
|
58,746 |
|
|
|
|
|
56,909 |
|
|
|
Total liabilities |
|
5,487,414 |
|
|
|
|
|
4,788,654 |
|
|
|
Shareholders’ equity |
|
601,762 |
|
|
|
|
|
545,964 |
|
|
|
Total liabilities and shareholders’ equity |
$ |
6,089,176 |
|
|
|
|
$ |
5,334,618 |
|
|
|
Net interest income |
|
$ |
106,670 |
|
|
|
|
$ |
88,914 |
|
|
Net interest spread |
|
|
3.43 |
% |
|
|
|
3.21 |
% |
Net interest margin |
|
|
3.60 |
% |
|
|
|
3.43 |
% |
|
|
|
|
|
|
|
|
Cost of Deposits: |
|
|
|
|
|
|
|
Non-interest bearing demand deposits |
$ |
1,293,477 |
|
|
|
|
$ |
987,365 |
|
|
|
Interest-bearing deposits |
|
3,965,349 |
|
|
8,477 |
|
0.43 |
% |
|
|
3,618,543 |
|
|
10,250 |
|
0.57 |
% |
Total Deposits |
$ |
5,258,826 |
|
$ |
8,477 |
|
0.33 |
% |
|
$ |
4,605,908 |
|
$ |
10,250 |
|
0.45 |
% |
|
|
|
|
|
|
|
______________________________(1) Includes non-accrual loans and
loans held for sale(2) Net loan fee income of $1.7 million and $1.2
million for the six months ended June 30, 2022 and 2021,
respectively, are included in the yield computations(3) Yields on
securities have been adjusted to a tax-equivalent basis
Preferred Bank |
Loan and Credit Quality Information |
|
|
|
|
Allowance For Credit Losses History |
|
Six Months Ended |
|
Year ended |
|
June 30, 2022 |
|
December 31, 2021 |
|
(Dollars in 000's) |
Allowance For Credit Losses |
|
|
|
Balance at Beginning of Period |
$ |
59,969 |
|
|
$ |
63,426 |
|
Charge-Offs |
|
|
|
Commercial & Industrial |
|
1,222 |
|
|
|
1,697 |
|
Mini-perm Real Estate |
|
1 |
|
|
|
817 |
|
Total Charge-Offs |
|
1,223 |
|
|
|
2,514 |
|
|
|
|
|
Recoveries |
|
|
|
Commercial & Industrial |
|
- |
|
|
|
57 |
|
Total Recoveries |
|
- |
|
|
|
57 |
|
|
|
|
|
Net Charge-Offs |
|
1,223 |
|
|
|
2,457 |
|
Provision for (reversal of) Credit Losses: |
|
2,650 |
|
|
|
(1,000 |
) |
Balance at End of Period |
$ |
61,396 |
|
|
$ |
59,969 |
|
|
|
|
|
Average Loans Held for Investment |
$ |
4,573,357 |
|
|
$ |
4,138,023 |
|
Loans Held for Investment at End of Period |
$ |
4,920,141 |
|
|
$ |
4,424,992 |
|
Net Charge-Offs to Average Loans |
|
0.05 |
% |
|
|
0.06 |
% |
Allowances for Credit Losses to Loans at End of Period |
|
1.25 |
% |
|
|
1.36 |
% |
|
|
|
|
1 This is a non-GAAP measure and linking to the reconciliation
on page 5.
Preferred Bank (NASDAQ:PFBC)
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