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Princeton Bancorp Announces Third Quarter 2023 Results

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Princeton Bancorp reports net income of $7.6 million for Q3 2023, an increase from Q2 2023. The bank's total assets increased by 19.4% compared to the end of 2022. Deposits increased by 21.5% compared to December 2022. The Bank of Princeton continues to focus on strong growth and has a sizable loan pipeline.
Positive
  • Princeton Bancorp reports net income of $7.6 million for Q3 2023, an increase from Q2 2023.
  • Total assets increased by 19.4% compared to the end of 2022.
  • Deposits increased by 21.5% compared to December 2022.
  • The Bank of Princeton continues to focus on strong growth and has a sizable loan pipeline.
Negative
  • None.

PRINCETON, N.J., Oct. 26, 2023 /PRNewswire/ -- Princeton Bancorp, Inc. (the "Company") (NASDAQ - BPRN), the bank holding company for The Bank of Princeton (the "Bank"), today reported its unaudited financial condition and results of operations at and for the quarter ended September 30, 2023.  The Company reported net income of $7.6 million, or $1.19 per diluted common share, for the third quarter of 2023, compared to net income of $6.8 million, or $1.07 per diluted common share, for the second quarter of 2023, and net income of $7.0 million, or $1.09 per diluted common share, for the third quarter of 2022. The increase in net income for the third quarter of 2023 when compared to the second quarter of 2023 was primarily due to a decrease of $7.7 million in non-interest expense, a decrease of $2.6 million in its provision for credit losses and an increase of $1.0 million in net interest income, partially offset by a decrease of $9.2 million in non-interest income and an increase of $1.4 million in income tax expense. The increase in net income for the third quarter of 2023 compared to the same period in 2022 was primarily due to an increase of $700 thousand in non-interest income, a $600 thousand decrease in income tax expense and a $400 thousand reduction in its provision for credit losses, partially offset by a $1.0 million decrease in net interest income. For the nine-month period ended September 30, 2023, the Company recorded net income of $20.5 million, or $3.21 per diluted common share, compared to $19.3 million, or $2.98 per diluted common share, for the same period in 2022. The increase was primarily due to an increase of $11.5 million in non-interest income and a $1.8 million decrease in income tax expense, partially offset by an $8.9 million increase in non-interest expense, and a $2.3 million increase in its provision for credit losses.

"The Bank continues to be well-positioned to promote strong growth," President/CEO Edward Dietzler commented on the quarter. The Bank was able to continue deposit growth and build significant liquidity to fund future loan demand. Our recent acquisition of Noah Bank is performing well giving us a strong platform to expand.  We will continue to look at other opportunities that fit our overall strategy."

As a result of the increase in deposits, balance sheet liquidity increased to $206.9 million in immediately available cash with zero borrowings. The Bank has a sizable loan pipeline in the communities we serve that it anticipates funding during the remainder of 2023, supported by the Bank's strong capital position.

Balance Sheet Review

Total assets were $1.91 billion at September 30, 2023, an increase of $311.3 million, or 19.4% when compared to $1.60 billion at the end of 2022. The primary reason for the increase in total assets was the acquisition of Noah Bank on May 19, 2023, which had approximately $239.4 million in assets at closing. When looking at specific components of the balance sheet, including acquired assets, the Company recorded an increase in net loans of $128.1 million, an increase in cash and cash equivalents of approximately $153.6 million, an increase in its right of use asset of $7.3 million, an increase of $4.9 million primarily due to Noah Bank's deferred tax assets and an increase in other assets of $2.5 million.  The increase in the Company's net loans consisted of a $206.7 million increase in commercial real estate loans and a $23.3 million increase in commercial and industrial loans, partially offset by a decrease of $96.7 million in construction loans.

Total deposits at September 30, 2023 increased $290.2 million, or 21.5%, when compared to December 31, 2022. The primary reasons for the increase in total deposits were the $191.7 million in deposits acquired from Noah Bank and a $98.5 million increase from existing operations. When comparing deposit products between the two periods, certificates of deposit increased $298.7 million and money market deposits increased $65.9 million. Partially offsetting these increases were decreases in savings deposits of $43.6 million and interest-bearing demand deposits of $29.8 million for the nine months ended September 30, 2023.

Total stockholders' equity at September 30, 2023 increased $12.6 million or 5.7% when compared to the end of 2022. The increase was primarily due to the $14.5 million increase in retained earnings, consisting of $20.5 million in net income partially offset by $5.7 million of cash dividends recorded during the period. The ratio of equity to total assets at September 30, 2023 and at December 31, 2022, was 12.1% and 13.7%, respectively. The current period ratio decrease was primarily due to the Noah Bank acquisition.

Asset Quality

At September 30, 2023, non-performing assets totaled $6.8 million, an increase of $6.5 million, when compared to the amount at December 31, 2022. This increase was due to the delinquency of a $4.5 million commercial real estate loan and $2.5 million of non-performing loans acquired from Noah Bank.

With the adoption of the Current Expected Credit Losses ("CECL") method of calculating the allowance for credit losses effective January 1, 2023, performing troubled debt restructurings ("TDRs") are no longer reported for the current period.  At December 31, 2022 there were three loans classified as TDR loans totaling $5.9 million and each of these loans was performing in accordance with the agreed-upon terms.

Review of Quarterly and Year-to-Date Financial Results

Net interest income was $16.7 million for the third quarter of 2023, compared to $15.7 million for the second quarter of 2023 and $17.7 million for the third quarter of 2022. The increase from the previous quarter was the result of an increase in interest income of $4.0 million, or 17.3%, partially offset by an increase in interest expense of $3.0 million, or 40.3%. The net interest margin for the third quarter 2023 was 3.76%, decreasing nineteen basis points when compared to the second quarter of 2023. This decrease was primarily associated with an increase of 49 basis points in the cost of funds associated with rising interest rates, partially offset by a 35 basis-point increase in the yield on loans. When comparing the three-month periods ended September 30, 2023 and 2022, net interest income decreased $1.0 million, which was primarily due to an increase of 213 basis points in the cost of funds, partially offset by an increase of 107 basis points in the yield earned on interest-earning assets. For the nine-month period ended September 30, 2023, net interest income of $49.0 million was down slightly compared to net interest income of $49.8 million during the first nine months of 2022.  The decrease from the previous nine-month period was the result of an increase in interest expense of $17.8 million, or 470.7%, partially offset by an increase in interest income of $17.0 million, or 31.7%, both as a result of the 525 basis-point increase in federal funds interest rates since March 2022.

The Bank recorded a credit provision for credit losses of $182 thousand during the three months ended September 30, 2023 and a $2.5 million provision for credit losses during the second quarter of 2023. The Bank recorded a $200 thousand provision for loan losses for the three months ended September 30, 2022. The credit recorded in the current quarter was the result of a reduction in the reserve for unfunded liabilities in the amount of $182 thousand. The provision for credit losses for loans was zero. The provision of $2.5 million recorded in the prior quarter consisted of $2.7 million provision associated with the Company's loan portfolio, offset by a credit to the provision of $250 thousand associated with unfunded commitments.  Included in the Company's second quarter 2023 provision was $1.7 million related to non-purchased credit deteriorated loans resulting from the Noah Bank acquisition. Net recoveries for the three-months ended September 30, 2023 were $23 thousand and net charge-offs for the nine-month period ended September 30, 2023 were $1.8 million. For the three-month and nine-month periods ended September 30, 2022, the Bank recorded net charge-offs of $200 thousand and $154 thousand, respectively. With the adoption of the CECL method of calculating the allowance for credit losses on January 1, 2023, the Bank recorded a one-time decrease, net of tax, in retained earnings of $284 thousand, a reduction to the allowance for credit losses of $301 thousand and an increase in the reserve for unfunded liabilities of $695 thousand. The coverage ratio of the allowance for credit losses to period end loans was 1.19% at September 30, 2023 and 1.20% at December 31, 2022.

Total non-interest income of $2.4 million for the third quarter of 2023 decreased $9.2 million or 79.2% when compared to the second quarter of 2023 and increased $696 thousand or 40.8% when compared to the quarter ended September 30, 2022. The decrease from the second quarter of 2023 was primarily due to the $9.7 million bargain purchase gain recorded in connection with the Noah acquisition completed during the second quarter of 2023. The increase over the prior year quarter was due to an increase in loan fees of $334 thousand and the gain on sale of other real estate owned of $203 thousand during the third quarter of 2023. For the nine-month period ended September 30, 2023, non-interest income increased $11.5 million, or by 296.9%, primarily due to the $9.7 million bargain purchase gain and an increase in loan fees of $1.3 million over the same period in 2022.

Total non-interest expense of $10.2 million for the third quarter of 2023 decreased $7.7 million, or 43.0% when compared to the second quarter of 2023, due primarily to the $7.0 million in merger costs associated with the Noah acquisition expensed during the second quarter, a portion of which, totaling $1.4 million, were reversed during the third quarter. The amounts reversed during the third quarter were primarily the result of a lease termination cost that was lower than the original estimate based on a negotiated settlement of the remaining lease on a Noah Bank branch office and a legal reserve of $150 thousand. Total non-interest expense for the third quarter of 2023 was almost the same as the third quarter of 2022.  The merger-related expenses reversed in 2023 were offset by increases in salaries and employee benefits and occupancy and equipment expenses of $401 thousand and $437 thousand, respectively, over the prior-year period associated with a full quarter of Noah costs versus a portion in the second quarter due to the closing date of May 19, 2023. For the nine-month period ended September 30, 2023, non-interest expense was $37.7 million, compared to $28.8 million for the same period in 2022. The increase was primarily due to merger-related expenses of $5.6 million during 2023 as well as increases in salaries and employee benefits of $2.1 million, occupancy and equipment of $742 thousand and data processing and communications of $726 thousand over the same period in 2022.

For the three-month period ended September 30, 2023, the Company recorded an income tax expense of $1.5 million, resulting in an effective tax rate of 16.6%, compared to an income tax expense of $161 thousand resulting in an effective tax rate of 2.3% for the three-month period ended June 30, 2023 due to the non-taxable bargain purchase gain, partially offset by $325 thousand of merger-related expenses that were not tax-deductible, and compared to an income tax expense of $2.1 million resulting in an effective tax rate of 23.2% for the three-month period ended September 30, 2022. For the nine-month period ending September 30, 2023, income tax expense was $3.6 million resulting in an effective tax rate of 14.9% compared to income tax expense of $5.4 million and an effective tax rate of 21.7% for the nine months ended September 30, 2022.

About Princeton Bancorp, Inc. and The Bank of Princeton

Princeton Bancorp, Inc. is the holding company for The Bank of Princeton, a community bank founded in 2007.  The Bank is a New Jersey state-chartered commercial bank with 22 branches in New Jersey, including three in Princeton and others in Bordentown, Browns Mills, Chesterfield, Cream Ridge, Deptford, Fort Lee, Hamilton, Kingston, Lakewood, Lambertville, Lawrenceville, Monroe, New Brunswick, Palisades Park, Pennington, Piscataway, Princeton Junction, Quakerbridge and Sicklerville.  There are also five branches in the Philadelphia, Pennsylvania area and two in the New York City metropolitan area. The Bank of Princeton is a member of the Federal Deposit Insurance Corporation ("FDIC").

Forward-Looking Statements

The Company may from time to time make written or oral "forward-looking statements," including statements contained in the Company's filings with the Securities and Exchange Commission, in its reports to stockholders and in other communications by the Company (including this press release), which are made in good faith by the Company pursuant to the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995 and Section 21E of the Securities Exchange Act of 1934, as amended.

These forward-looking statements involve risks and uncertainties, such as statements of the Company's plans, objectives, expectations, estimates and intentions that are subject to change based on various important factors (some of which are beyond the Company's control). The most significant factors that could cause future results to differ materially from those anticipated by our forward-looking statements include the ongoing impact of higher inflation levels, higher interest rates and general economic and recessionary concerns, all of which could impact economic growth and could cause a reduction in financial transactions and business activities, including decreased deposits and reduced loan originations, our ability to manage liquidity in a rapidly changing and unpredictable market, supply chain disruptions, labor shortages and additional interest rate increases by the Federal Reserve. Other factors that could cause actual results to differ materially from those indicated by forward-looking statements include, but are not limited to, the following factors: the global impact of the military conflicts in the Ukraine and the Middle East; the impact of any future pandemics or other natural disasters; civil unrest, rioting, acts or threats of terrorism, or actions taken by the local, state and Federal governments in response to such events, which could impact business and economic conditions in our market area; the strength of the United States economy in general and the strength of the local economies in which the Company and Bank conduct operations; the effects of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System; market and monetary fluctuations; market volatility; the value of the Bank's products and services as perceived by actual and prospective customers, including the features, pricing and quality compared to competitors' products and services; the willingness of customers to substitute competitors' products and services for the Bank's products and services; credit risk associated with the Bank's lending activities; risks relating to the real estate market and the Bank's real estate collateral; the impact of changes in applicable laws and regulations and requirements arising out of our supervision by banking regulators; other regulatory requirements applicable to the Company and the Bank; and the timing and nature of the regulatory response to any applications filed by the Company and the Bank; technological changes; acquisitions including the Company's acquisition of Noah; difficulties and delays in integrating the businesses of Noah and TBOP or fully realizing cost savings and other benefits; changes in consumer spending and saving habits; those risks under the heading "Risk Factors" set forth in the Bank's Annual Report on Form 10-K for the year ended December 31, 2022, and in Part II, Item 1A of our quarterly report on Form 10-Q for the quarter-ended March 31, 2023, and the success of the Company at managing the risks involved in the foregoing.

The Company cautions that the foregoing list of important factors is not exclusive. The Company does not undertake to update any forward-looking statement, whether written or oral, that may be made from time to time by or on behalf of the Company, except as required by applicable law or regulation.

Princeton Bancorp, Inc.


Consolidated Statements of Financial Condition


(Unaudited)


(Dollars in thousands, except per share data)












































September 30, 2023 vs



September 30, 2023 vs




September 30,


December 31,


September 30,


December 31, 2022



September 30, 2022




2023


2022


2022


$ Change


% Change


$ Change


% Change


















ASSETS







Cash and cash equivalents


$       206,931


$         53,351


$         47,965


$  153,580


287.87

%


$     158,966


331.42

%

Securities available-for-sale taxable


50,437


42,061


43,041


8,376


19.91



7,396


17.18


Securities available-for-sale tax-exempt


37,627


41,341


39,112


(3,714)


(8.98)



(1,485)


(3.80)


Securities held-to-maturity


195


201


203


(6)


(2.99)



(8)


(3.94)


Loans receivable, net of deferred loan fees


1,498,500


1,370,368


1,378,426


128,132


9.35



120,074


8.71


Allowance for credit losses


(17,992)


(16,461)


(16,666)


(1,531)


9.30



(1,326)


7.96


Goodwill


8,853


8,853


8,853


-


-



-


-


Core deposit intangible


1,546


1,825


1,958


(279)


(15.29)



(412)


(21.04)


Other assets


127,026


100,240


100,158


26,786


26.72



26,868


26.83


TOTAL ASSETS


$     1,913,123


$     1,601,779


$     1,603,050


$  311,344


19.44

%


$     310,073


19.34

%



































LIABILITIES

















Non-interest checking


$       264,197


$       265,078


$       299,389


$       (881)


(0.33)

%


$     (35,192)


(11.75)

%

Interest checking


239,902


269,737


233,969


(29,835)


(11.06)



5,933


2.54


Savings


147,113


190,686


213,522


(43,573)


(22.85)



(66,409)


(31.10)


Money market


349,505


283,652


324,037


65,853


23.22



25,468


7.86


Time deposits over $250,000 


144,158


83,410


46,810


60,748


72.83



97,348


207.96


Other time deposits


493,091


255,167


249,287


237,924


93.24



243,804


97.80


Total deposits


1,637,966


1,347,730


1,367,014


290,236


21.54



270,952


19.82


Borrowings


-


10,000


-


(10,000)


(100.00)



-


       N/A 


Other liabilities


42,949


24,448


23,518


18,501


75.67



19,431


82.62


    TOTAL LIABILITIES


1,680,915


1,382,178


1,390,532


298,737


21.61



290,383


20.88



















STOCKHOLDERS' EQUITY

















Common stock 1,2


-


34,547


34,535


(34,547)


(100.00)



(34,535)


(100.00)


Paid-in capital 2


97,779


81,291


81,241


16,488


20.28



16,538


20.36


Treasury stock 2


-


(19,452)


(19,190)


19,452


(100.00)



19,190


(100.00)


Retained earnings


146,022


131,488


125,878


14,534


11.05



20,144


16.00


Accumulated other comprehensive income (loss)


(11,593)


(8,273)


(9,946)


(3,320)


40.13



(1,647)


16.56


     TOTAL STOCKHOLDERS' EQUITY 


232,208


219,601


212,518


12,607


5.74



19,690


9.27



















TOTAL LIABILITIES 

















     AND STOCKHOLDERS' EQUITY


$     1,913,123


$     1,601,779


$     1,603,050


$  311,344


19.44

%


$     310,073


19.34

%


















Book value per common share


$           36.86


$           35.16


$           34.00


$       1.70


4.84

%


$          2.86


8.41

%

Tangible book value per common share 3


$           35.21


$           33.45


$           32.27


$       1.76


5.26

%


$          2.94


9.11

%


















1The common stock of Princeton Bancorp, Inc. has no par value.  The par value of the common stock of the Bank was $5.00 per share.








2The balances of common stock and treasury stock were reclassified to paid-in capital effective January 10, 2023, upon formation of Princeton Bancorp, Inc.




3Tangible book value per common share is a non-GAAP measure that represents book value per common share which excludes goodwill and core deposit intangible.




 

Princeton Bancorp, Inc.

Loan and Deposit Tables

(Unaudited)







The components of loans receivable, net at September 30, 2023 and December 31, 2022 were as follows:









September 30,


December 31,




2023


2022




(In thousands)


Commercial real estate


$     1,080,288


$        873,573


Commercial and industrial


52,157


28,859


Construction


320,824


417,538


Residential first-lien mortgages


39,682


43,125


Home equity / consumer


7,860


9,729


     Total loans


1,500,811


1,372,824


Deferred fees and costs 


(2,311)


(2,456)


Allowance for credit losses


(17,992)


(16,461)


     Loans, net


$     1,480,508


$     1,353,907


























The components of deposits at September 30, 2023 and December 31, 2022 were as follows:









September 30,


December 31,




2023


2022




(In thousands)


Demand, non-interest-bearing


$        264,197


$        265,078


Demand, interest-bearing 


239,902


269,737


Savings


147,113


190,686


Money market


349,505


283,652


Time deposits


637,249


338,577


     Total deposits


$     1,637,966


$     1,347,730


 

Princeton Bancorp, Inc.

Consolidated Statements of Income

(Unaudited)

(Amounts in thousands except per share data)














Three Months Ended September 30,








2023


2022


$ Change


% Change

Interest and dividend income









Loans and fees

$              23,503


$              18,336


$    5,167


28.2 %


Available-for-sale debt securities:










Taxable

357


241


116


48.1 %



Tax-exempt

285


286


(1)


-0.3 %


Held-to-maturity debt securities

3


2


1


50.0 %


Other interest and dividend income

2,852


226


2,626


1161.9 %



Total interest and dividends

27,000


19,091


7,909


41.4 %











Interest expense












Deposits

10,316


1,392


8,924


641.1 %



Borrowing

-


3


(3)


-100.0 %



Total interest expense

10,316


1,395


8,921


639.5 %











Net interest income


16,684


17,696


(1,012)


-5.7 %

(Credit) provision for credit losses

(182)


200


(382)


-191.0 %

Net interest income after provision for credit losses

16,866


17,496


(630)


-3.6 %











Non-interest income









Loss on sale of securities available-for-sale, net

(6)


-


(6)


       N/A


Income from bank-owned life insurance

331


287


44


15.3 %


Fees and service charges

479


469


10


2.1 %


Loan fees, including prepayment penalties

1,184


850


334


39.3 %


Gain on sale of other real estate owned

203


-


203


       N/A


Other 

212


101


111


109.9 %



Total non-interest income

2,403


1,707


696


40.8 %











Non-interest expense









Salaries and employee benefits

6,177


5,442


735


13.5 %


Occupancy and equipment

2,142


1,539


603


39.2 %


Professional fees

614


786


(172)


-21.9 %


Data processing and communications

1,242


1,043


199


19.1 %


Federal deposit insurance

258


249


9


3.6 %


Advertising and promotion

139


140


(1)


-0.7 %


Office expense

117


52


65


125.0 %


Core deposit intangible

116


135


(19)


-14.1 %


Merger-related expenses

(1,391)


-


(1,391)


       N/A


Other 

745


739


6


0.8 %



Total non-interest expense

10,159


10,125


34


0.3 %











Income before income tax expense

9,110


9,078


32


0.4 %

Income tax expense

1,512


2,103


(591)


-28.1 %

Net income

$               7,598


$               6,975


623


8.9 %











Net income per common share - basic

$                 1.21


$                 1.12


$     0.09


8.0 %

Net income per common share - diluted

$                 1.19


$                 1.09


$     0.10


9.2 %











Weighted average shares outstanding - basic

6,295


6,269


26


0.4 %

Weighted average shares outstanding - diluted

6,390


6,378


12


0.2 %

 

Princeton Bancorp, Inc.

Consolidated Statements of Income (Current Quarter vs Prior Quarter)

(Unaudited)

(Amounts in thousands, except per share data)














Three Months Ended








September 30,


June 30,








2023


2023


$ Change


% Change

Interest and dividend income









Loans and fees

$       23,503


$       21,517


$      1,986


9.2 %


Available-for-sale debt securities:










Taxable

357


292


65


22.3 %



Tax-exempt

285


284


1


0.4 %


Held-to-maturity debt securities

3


2


1


50.0 %


Other interest and dividend income

2,852


919


1,933


210.3 %



Total interest and dividends

27,000


23,014


3,986


17.3 %











Interest expense












Deposits

10,316


7,321


2,995


40.9 %



Borrowing

-


32


(32)


-100.0 %



Total interest expense

10,316


7,353


2,963


40.3 %











Net interest income


16,684


15,661


1,023


6.5 %

(Credit) provision for credit losses

(182)


2,463


(2,645)


-107.4 %

Net interest income after provision for credit losses

16,866


13,198


3,668


27.8 %











Non-interest income









Loss on sale of securities available-for-sale, net

(6)


-


(6)


       N/A


Income from bank-owned life insurance

331


295


36


12.2 %


Fees and service charges

479


464


15


3.2 %


Loan fees, including prepayment penalties

1,184


1,030


154


15.0 %


Bargain purchase gain

-


9,696


(9,696)


-100.0 %


Gain on sale of other real estate owned

203


-


203


       N/A


Other 

212


80


132


165.0 %



Total non-interest income

2,403


11,565


(9,162)


-79.2 %











Non-interest expense









Salaries and employee benefits

6,177


5,776


401


6.9 %


Occupancy and equipment

2,142


1,705


437


25.6 %


Professional fees

614


556


58


10.4 %


Data processing and communications

1,242


1,318


(76)


-5.8 %


Federal deposit insurance

258


253


5


2.0 %


Advertising and promotion

139


126


13


10.3 %


Office expense

117


178


(61)


-34.3 %


Other real estate owned expense

-


1


(1)


-100.0 %


Core deposit intangible

116


127


(11)


-8.7 %


Merger-related expenses

(1,391)


7,026


(8,417)


-119.8 %


Other 

745


748


(3)


-0.4 %



Total non-interest expense

10,159


17,814


(7,655)


-43.0 %











Income before income tax expense

9,110


6,949


2,161


31.1 %

Income tax expense

1,512


161


1,351


839.1 %

Net income

$         7,598


$         6,788


$        810


11.9 %











Net income per common share - basic

$           1.21


$           1.08


$       0.13


12.0 %

Net income per common share - diluted

$           1.19


$           1.07


$       0.12


11.2 %











Weighted average shares outstanding - basic

6,295


6,270


25


0.4 %

Weighted average shares outstanding - diluted

6,390


6,366


24


0.4 %

 

Princeton Bancorp, Inc.

Consolidated Statements of Income

(Unaudited)

(Amounts in thousands, except per share data)














Nine Months Ended








September 30,








2023


2022


$ Change


% Change

Interest and dividend income









Loans and fees

$ 64,914


$  51,596


$     13,318


25.8 %


Available-for-sale debt securities:










Taxable

927


698


229


32.8 %



Tax-exempt

853


882


(29)


-3.3 %


Held-to-maturity debt securities

8


8


0


0.0 %


Other interest and dividend income

3,924


441


3,483


789.8 %



Total interest and dividends

70,626


53,625


17,001


31.7 %











Interest expense












Deposits

21,502


3,785


17,717


468.1 %



Borrowings

118


3


115


3833.3 %



Total interest expense

21,620


3,788


17,832


470.7 %











Net interest income


49,006


49,837


(831)


-1.7 %

Provision for credit losses

2,546


200


2,346


1173.0 %

Net interest income after provision for credit losses

46,460


49,637


(3,177)


-6.4 %











Non-interest income









(Loss) gain on sale of securities available-for-sale, net

(6)


2


(8)


-400.0 %


Income from bank-owned life insurance

916


852


64


7.5 %


Fees and service charges

1,391


1,441


(50)


-3.5 %


Loan fees, including prepayment penalties

2,565


1,248


1,317


105.5 %


Bargain purchase gain

9,696


-


9,696


      N/A


Gain on sale of other real estate owned

203


-


203


      N/A


Other 

577


322


255


79.2 %



Total non-interest income

15,342


3,865


11,477


296.9 %











Non-interest expense









Salaries and employee benefits

17,352


15,251


2,101


13.8 %


Occupancy and equipment

5,188


4,446


742


16.7 %


Professional fees

1,635


1,929


(294)


-15.2 %


Data processing and communications

3,860


3,134


726


23.2 %


Federal deposit insurance

701


788


(87)


-11.0 %


Advertising and promotion

375


379


(4)


-1.1 %


Office expense

392


168


224


133.3 %


Other real estate owned expense

1


112


(111)


-99.1 %


Core deposit intangible

378


434


(56)


-12.9 %


Merger-related expenses

5,635


-


5,635


      N/A


Other 

2,228


2,180


48


2.2 %



Total non-interest expense

37,745


28,821


8,924


31.0 %











Income before income tax expense

24,057


24,681


(624)


-2.5 %

Income tax expense

3,574


5,358


(1,784)


-33.3 %

Net income

$ 20,483


$  19,323


$       1,160


6.0 %











Net income per common share - basic

$    3.26


$     3.05


$        0.21


7.0 %

Net income per common share - diluted

$    3.21


$     2.98


$        0.23


7.7 %











Weighted average shares outstanding - basic

6,275


6,345


(70)


-1.1 %

Weighted average shares outstanding - diluted

6,380


6,475


(95)


-1.5 %

 

Princeton Bancorp, Inc.

Consolidated Average Statement of Financial Condition

(Unaudited)

(Dollars in thousands)














For the Three Months Ended September 30,






2023


2022


Change in


Change in


Average 


Yield/


Average 


Yield/


Average 


Yield/


Balance


Rate 


Balance


Rate 


Balance


Rate 

Earning assets












Loans 

$     1,464,798


6.37 %


$    1,386,589


5.25 %


$        78,209


1.12 %

Securities












  Taxable available-for-sale

46,599


3.06 %


46,281


2.06 %


318


1.00 %

  Tax-exempt available-for-sale

40,118


2.84 %


42,220


2.68 %


(2,102)


0.16 %

  Held-to-maturity

196


5.28 %


204


5.24 %


(8)


0.04 %

Securities

86,913


2.96 %


88,704


2.37 %


(1,791)


0.59 %













Other interest earning assets












  Federal funds sold

199,350


5.38 %


35,081


2.28 %


164,269


3.10 %

  Other interest-earning assets

10,506


5.67 %


1,322


5.85 %


9,184


-0.18 %

Other interest-earning assets

209,856


5.39 %


36,403


2.41 %


173,453


2.98 %

Total interest-earning assets

1,761,567


6.08 %


1,511,697


5.01 %


249,870


1.07 %

Total non-earning assets

127,682




115,158







Total assets

$     1,889,249




$    1,626,856































Interest-bearing liabilities












Checking

$        243,359


1.68 %


$      240,948


0.29 %


$          2,411


1.39 %

Savings

149,215


2.10 %


217,133


0.32 %


(67,918)


1.78 %

Money market

337,491


3.50 %


350,901


0.43 %


(13,410)


3.07 %

Certificates of deposit

629,082


3.48 %


289,274


0.86 %


339,808


2.62 %

    Total interest-bearing deposits

1,359,147


3.01 %


1,098,256


0.51 %


260,891


2.50 %

Non-interest bearing deposits

255,775




285,665




(29,890)



    Total  deposits

1,614,922


2.53 %


1,383,921


0.40 %


231,001


2.13 %

Borrowings

-


      N/A


391


2.65 %


(391)


          N/A

    Total interest-bearing liabilities 












       (excluding non interest deposits)

1,359,147


3.01 %


1,098,647


0.51 %


260,500


2.50 %

Non-interest-bearing deposits

255,775




285,665







Total cost of funds

1,614,922


2.53 %


1,384,312


0.40 %


230,610


2.13 %

Accrued expenses and other liabilities

45,923




28,136







Stockholders' equity

228,404




214,408







Total liabilities and stockholders' equity

$     1,889,249




$    1,626,856



















Net interest spread



3.07 %




4.50 %





Net interest margin



3.76 %




4.64 %





Net interest margin (FTE)1



3.81 %




4.71 %

















  1Includes federal and state tax effect of tax-exempt securities and loans.










 

Princeton Bancorp, Inc.

Consolidated Average Statement of Financial Condition

(Unaudited)

(Dollars in thousands)














For the Three Months Ended






September 30, 2023


June 30, 2023


Change in


Change in


Average 


Yield/


Average 


Yield/


Average 


Yield/


Balance


Rate 


Balance


Rate 


Balance


Rate 

Earning assets












Loans 

$    1,464,798


6.37 %


$       1,432,680


6.02 %


$       32,118


0.35 %

Securities












  Taxable available-for-sale

46,599


3.06 %


44,669


2.63 %


1,930


0.43 %

  Tax-exempt available-for-sale

40,118


2.84 %


41,187


2.76 %


(1,069)


0.08 %

  Held-to-maturity

196


5.28 %


198


5.28 %


(2)


0.00 %

Securities

86,913


2.96 %


86,054


2.69 %


859


0.27 %













Other interest earning assets












  Federal funds sold

199,350


5.38 %


65,383


5.16 %


133,967


0.22 %

  Other interest-earning assets

10,506


5.67 %


5,691


5.31 %


4,815


0.36 %

Other interest-earning assets

209,856


5.39 %


71,074


5.17 %


138,782


0.22 %

Total interest-earning assets

1,761,567


6.08 %


1,589,808


5.81 %


171,759


0.27 %

Total non-earning assets

127,682




110,384







Total assets

$    1,889,249




$       1,700,192































Interest-bearing liabilities












Checking

$      243,359


1.68 %


$         242,667


1.38 %


$            692


0.30 %

Savings

149,215


2.10 %


158,937


1.73 %


(9,722)


0.37 %

Money market

337,491


3.50 %


285,021


2.97 %


52,470


0.53 %

Certificates of deposit

629,082


3.48 %


516,252


2.87 %


112,830


0.61 %

    Total interest-bearing deposits

1,359,147


3.01 %


1,202,877


2.44 %


156,270


0.57 %

Non-interest bearing deposits

255,775




235,423




20,352



    Total  deposits

1,614,922


2.53 %


1,438,300


2.04 %


176,622


0.49 %

Borrowings

-


      N/A


2,482


5.08 %


(2,482)


            N/A

    Total interest-bearing liabilities 












       (excluding non interest deposits)

1,359,147


3.01 %


1,205,359


2.45 %


153,788


0.56 %

Non-interest-bearing deposits

255,775




235,423







Total cost of funds

1,614,922


2.53 %


1,440,782


2.04 %


174,140


0.49 %

Accrued expenses and other liabilities

45,923




32,232







Stockholders' equity

228,404




227,178







Total liabilities and stockholders' equity

$    1,889,249




$       1,700,192



















Net interest spread



3.07 %




3.36 %





Net interest margin



3.76 %




3.95 %





Net interest margin (FTE)1



3.81 %




3.99 %

















  1Includes federal and state tax effect of tax-exempt securities and loans.









 

Princeton Bancorp, Inc.

Consolidated Average Statement of Financial Condition

(Unaudited)

(Dollars in thousands)














For the Nine Months Ended September 30,






2023


2022


Change in


Change in


Average 


Yield/


Average 


Yield/


Average 


Yield/


Balance


Rate 


Balance


Rate 


Balance


Rate 

Earning assets












Loans 

$    1,424,768


6.09 %


$    1,375,233


5.02 %


$         49,535


1.07 %

Securities












  Taxable available-for-sale

44,517


2.78 %


47,626


1.96 %


(3,109)


0.82 %

  Tax-exempt available-for-sale

40,974


2.78 %


44,832


2.63 %


(3,858)


0.15 %

  Held-to-maturity

198


5.28 %


205


2.59 %


(7)


2.69 %

Securities

85,689


2.78 %


92,664


2.29 %


(6,975)


0.49 %













Other interest earning assets












  Federal funds sold

91,761


5.30 %


76,559


0.68 %


15,202


4.62 %

  Other interest-earning assets

7,086


5.36 %


1,327


4.96 %


5,759


0.40 %

Other interest-earning assets

98,848


5.31 %


77,887


0.44 %


20,961


4.87 %

Total interest-earning assets

1,609,304


5.87 %


1,545,783


4.64 %


63,521


1.23 %

Total non-earning assets

114,543




112,573







Total assets

$    1,723,847




$    1,658,356































Interest-bearing liabilities












Checking

$      250,100


1.29 %


$      257,284


0.26 %


$          (7,184)


1.03 %

Savings

163,516


1.54 %


226,532


0.26 %


(63,016)


1.28 %

Money market

297,360


2.81 %


374,570


0.34 %


(77,210)


2.47 %

Certificates of deposit

504,237


2.90 %


285,855


0.91 %


218,382


1.99 %

    Total interest-bearing deposits

1,215,213


2.37 %


1,144,242


0.42 %


70,971


1.95 %

Non-interest bearing deposits

244,718




280,761







    Total  deposits

1,459,931


1.97 %


1,425,004


0.36 %


34,927


1.61 %













Borrowings

3,133


5.01 %


132


2.65 %


3,001


2.36 %

    Total interest-bearing liabilities 












       (excluding non interest deposits)

1,218,346


2.37 %


1,144,374


0.45 %


73,972


1.92 %

Non-interest-bearing deposits

244,718




280,761







Total cost of funds

1,463,064


1.97 %


1,425,135


0.36 %


37,929


1.61 %

Accrued expenses and other liabilities

34,312




18,680







Stockholders' equity

226,471




214,541







Total liabilities and stockholders' equity

$    1,723,847




$    1,658,356



















Net interest spread



3.50 %




4.19 %





Net interest margin



4.07 %




4.31 %





Net interest margin (FTE)1



4.13 %




4.37 %

















  1Includes federal and state tax effect of tax-exempt securities and loans.







 

Princeton Bancorp, Inc.

Quarterly Financial Highlights

(Unaudited)













2023


2023


2023


2022


2022



September


June


March


December


September













     Return on average assets 

1.60 %


1.60 %


1.56 %


1.76 %


1.70 %


     Return on average equity 

13.20 %


11.98 %


11.05 %


13.20 %


12.91 %


     Return on average tangible equity1

13.83 %


12.57 %


11.60 %


13.89 %


13.59 %


     Net interest margin

3.76 %


3.95 %


4.59 %


4.82 %


4.64 %


     Net interest margin (FTE)2

3.81 %


3.99 %


4.66 %


4.89 %


4.71 %


     Efficiency ratio - non-GAAP3 

59.89 %


60.82 %


53.43 %


49.56 %


51.49 %













COMMON STOCK DATA











     Market value at period end

$     28.99


$     27.32


$     31.72


$     31.72


$     28.35


     Market range:











        High

$     31.69


$     33.00


$     37.18


$     32.80


$     29.95


        Low

$     27.37


$     24.09


$     31.18


$     28.57


$     27.16


     Book value per common share at period end

$     36.86


$     36.45


$     35.98


$     35.16


$     34.00


     Tangible book value per common share at period end4

$     35.21


$     34.78


$     34.29


$     33.45


$     32.27


     Shares of common stock outstanding (in thousands)

6,299


6,279


6,262


6,245


6,251













CAPITAL RATIOS











Total capital (to risk-weighted assets)

14.96 %


14.57 %


15.43 %


15.12 %


14.71 %


Tier 1 capital (to risk-weighted assets)

13.89 %


13.50 %


14.36 %


14.06 %


13.63 %


Tier 1 capital (to average assets)

12.38 %


13.43 %


14.00 %


13.47 %


13.10 %


     Period-end equity to assets

12.14 %


12.42 %


14.21 %


13.71 %


13.26 %


     Period-end tangible equity to tangible assets 

11.66 %


11.92 %


13.64 %


13.13 %


12.67 %













CREDIT QUALITY DATA (Dollars in thousands)











     Net charge-offs (recoveries)

$        (23)


$     1,842


$         (3)


$       406


$       200


     Annualized net charge-offs (recoveries) to average loans

-0.006 %


0.514 %


-0.001 %


0.118 %


0.058 %













     Nonperforming loans

$     6,755


$     9,753


$     6,456


$       266


$       370


     Other real estate owned

-


33


-


-


-


     Total nonperforming assets

$     6,755


$     9,786


$     6,456


$       266


$       370













     Allowance for credit losses as a percent of:











     Period-end loans, net of deferred fees and costs      

1.20 %


1.20 %


1.19 %


1.20 %


1.21 %


     Nonaccrual loans 

266.35 %


184.25 %


255.68 %


6188.35 %


2286.15 %


     Nonperforming assets 

266.35 %


183.63 %


255.68 %


6188.35 %


2286.15 %













    Nonaccrual loans as a percent of total loans, net of deferred fees and costs

0.45 %


0.65 %


0.46 %


0.02 %


0.03 %
























1Return on average tangible equity is a non-GAAP measure that represents the rate of return on tangible common equity.







2Includes the effect of tax-exempt securities and loans.











3The efficiency ratio is a non-GAAP measure that represents the ratio of non-interest expense (excluding amortization of core deposit intangible and merger-) 


       related expenses) divided by net interest income and non-interest income (excluding bargain purchase gain). 








4Tangible book value per common share is a non-GAAP measure that represents book value per common share which 







      excludes goodwill and core deposit intangible. 











 

Contact George Rapp
609.454.0718
grapp@thebankofprinceton.com

Cision View original content to download multimedia:https://www.prnewswire.com/news-releases/princeton-bancorp-announces-third-quarter-2023-results-301968156.html

SOURCE The Bank of Princeton

FAQ

What was Princeton Bancorp's net income for Q3 2023?

Princeton Bancorp reported net income of $7.6 million for the third quarter of 2023.

How much did total assets increase by compared to the end of 2022?

Total assets increased by 19.4% compared to the end of 2022.

What was the increase in deposits compared to December 2022?

Deposits increased by 21.5% compared to December 2022.

What is The Bank of Princeton focusing on?

The Bank of Princeton is focusing on strong growth and has a sizable loan pipeline.

Princeton Bancorp, Inc.

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