Patriot Bank Earnings Soar 165% in Q1

By GlobeNewswire,  May 09, 2017, 12:35:00 PM EDT


Deposits Up 32% & Loans Up 30% Year-Over-Year

STAMFORD, Conn., May 09, 2017 (GLOBE NEWSWIRE) -- Patriot National Bancorp, Inc. ("Patriot", "Bancorp") (NASDAQ:PNBK), the parent company of Patriot Bank, N.A. (the "Bank"), today announced its third consecutive quarter of powerful earnings momentum. Patriot reports first quarter net income of $1,730,000, or $0.44 per diluted share, a towering 165% increase over a year ago. Also, at the end of 2016, Patriot surpassed the three quarters of a billion dollar milestone and continued to demonstrate growth in the first quarter.

First quarter earnings also increased over the prior quarter by 66%.  For comparison to prior quarterly periods, the third quarter of 2016 saw $814,000 in net income, or $0.21 per diluted share, while in the fourth quarter Patriot reported $1,045,000 in net income, or $0.27 per share. The current quarter results include the impact of a substantial recovery of a loan that was charged-off last year.

As of March 31, 2017, total assets increased to $775 million, as compared to $757 million at December 31, 2016 and $636 million at March 31, 2016.  Net loans totaled $625 million, up 8% over $577 million as of December 31, 2016, and up 30% over $480 million at March 31, 2016. 

Deposits grew 6%, or $32 million, to $561 million at March 31, 2017 as compared to $529 million at December 31, 2016 and $424 million at March 31 2016.  Deposit growth remains a key initiative to keep pace with Patriot's overall growth prospects. Patriot has seen total deposits grow an aggregate of 32% over the last year.

CEO Michael Carrazza stated: "Patriot's recent jump in performance is a direct result of performance enhancing strategies that we designed and began implementing in the third quarter 2016.  The amalgamation of broad-based operational improvements, management changes, asset-class repositioning, and balance sheet reengineering are producing these very positive results, and they remain ongoing.  Tackled in this quarter was the successful recovery of a charged-off loan that had been paralyzed in a protracted legal process.  Our initiatives support a steady, predictable earnings trend, and our increasing scale will further drive efficiencies."

Mr. Carrazza took operational control of Patriot as interim CEO in August 2016 to execute a series of value-enhancing strategies and to reposition the executive team.  The performance in the past three quarters reflects a keenly focused and regimented effort to drive profitability and shareholder value. 

"Patriot's banking platform is on a solid earnings trajectory, which improves each day.  Shareholders should benefit from increasing scale, profitability and strategic activities that are intently underway," added Mr. Carrazza.

The loan pipeline remains strong and continued growth is expected.  Patriot's net interest margin was 3.50% for the first quarter, as compared to 3.75% in the prior quarter and 3.76% in the first quarter of 2016. Net interest income decreased by $343,000, or 6%, as compared to the 4th quarter of 2016, and increased by $109,000, or 2%, compared to the 1st  quarter of 2016.   

The decline from the fourth quarter reflects the full quarter impact of interest paid on long-term senior debt issued in December of 2016 and also reflects a timing mis-match between loan attrition early in the quarter and new loans that closed late in the quarter.

The provision for loan losses in the quarter was a net credit of $1,749,000, reflecting the previously noted recovery, partially offset by a $1.1 million addition to the Allowance for Loan Loss to reflect the growth in the end of period loan balance. The provision for loan losses was $150,000 in the 4th quarter of 2016 and zero in the 1st quarter of 2016.   

Non-interest income decreased by $91,000 or 25%, over last quarter and $133,000, or 32%, below the same period last year.  Both comparisons were impacted by a loss of $78,000 recognized on the sale of investment portfolio securities, as the portfolio was intentionally re-positioned to provide future enhancements to profitability.

Non-interest expense increased $280,000, or 6%, over last quarter and declined by $70,000, or 1% compared to the 1st quarter of 2016. 

As of March 31, 2017 shareholders' equity was $64.4 million, an increase of $1.8 million over December 31, 2016, at $62.6 million. This was a direct result of the reported net income of the first quarter of 2017. The Company's book value per share increased to $16.55 at March 31, 2017 as compared to $16.08 at December 31, 2016 and $15.75 at March 31, 2016.

The Bank's capital ratios continue to be strong, as the Bank maintained its "well capitalized" regulatory status.  As of March 31, 2017 Tier 1 leverage ratio was 10.65%, Tier 1 risk based capital was 11.09% and total risk based capital was 11.96%.   

About the Company

Patriot National Bancorp, Inc. is headquartered in Stamford, Connecticut and the Bank has full service branches in Connecticut and New York.

Since opening its doors in 1994, the Company's mission has been to serve our local communities by helping our neighbors and neighborhood businesses thrive. All lending is handled locally and is specific to each borrower, and the commitment to local businesses goes further to connect, support and grow businesses in both the for-profit and nonprofit sectors, along with municipalities. Patriot believes a well-connected community is a strong community—and that together, all will prosper.

"Safe Harbor" Statement Under Private Securities Litigation Reform Act of 1995

Certain statements contained in Bancorp's public statements, including this one, may be forward looking and subject to a variety of risks and uncertainties. These factors include, but are not limited to, (1) changes in prevailing interest rates which would affect the interest earned on Bancorp's interest earning assets and the interest paid on its interest bearing liabilities, (2) the timing of repricing of Bancorp's interest earning assets and interest bearing liabilities, (3) the effect of changes in governmental monetary policy, (4) the components of Bancorp's periodic earnings and assets, (5) the fact that certain of the income recognized by Bancorp in any quarter may not be repeated in future periods, (6) the effect of changes in regulations applicable to Bancorp and the Bank and the conduct of its business, (7) changes in competition among financial service companies, including possible further encroachment of non-banks on services traditionally provided by banks, (8) the ability of competitors that are larger than Bancorp to provide products and services which it is impracticable for Bancorp to provide, (9) the state of the economy and real estate values in Bancorp's market areas, and the consequent effect on the quality of Bancorp's loans, (10) recent governmental initiatives that are expected to have a profound effect on the financial services industry and could dramatically change the competitive environment of the Company, (11) other legislative or regulatory changes, including those related to residential mortgages, changes in accounting standards, and Federal Deposit Insurance Corporation ("FDIC") premiums that may adversely affect the Company, (12) the application of generally accepted accounting principles, consistently applied,  (13) the fact that one period of reported results may not be indicative of future periods,  (14)  the state of the economy in the greater New York metropolitan area and its particular effect on the Company's customers, vendors and communities and other such factors, including risk factors, as may be described in Bancorp's other filings with the SEC.

               
PATRIOT NATIONAL BANCORP, INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited)

             
Dollars in thousands

    Mar 31, 2017   Dec 31, 2016   Mar 31, 2016
                     
Assets              
                     
Noninterest bearing deposits and cash     $   5,086     $   2,596     $   2,931  
Interest bearing deposits           55,180         89,693         64,075  
  Total cash and cash equivalents       60,266         92,289         67,006  
                     
Securities-available for sale           21,201         24,428         28,735  
Other investments             4,450         4,450         4,450  
  Total investment securities         25,651         28,878         33,185  
                     
FRB & FHLB stock         7,847         7,718         8,669  
Gross loans         630,727         581,657         485,183  
Allowance for loan losses           (5,697 )       (4,675 )       (5,247 )
  Net loans           625,030         576,982         479,936  
                     
Accrued interest and dividends receivable       3,063         2,726         2,075  
Premises and equipment, net         33,442         32,759         29,790  
Other real estate owned           851         851         -   
Deferred tax asset, net           11,691         12,632         13,354  
Other assets             6,921         1,819         1,566  
  Total Assets       $    774,762     $    756,654     $    635,581  
                     
Liabilities and Shareholders' Equity              
                     
Deposits              
  Noninterest bearing deposits   $   78,372     $   76,772     $   80,594  
  Interest bearing deposits         482,587         452,552         343,361  
                560,959         529,324         423,955  
                     
FHLB advances         124,000         123,000         134,900  
Other short term borrowings           -          15,000         -   
Note Payable - long term senior debt         11,647         11,628         -   
Subordinated debt         8,080         8,079         8,074  
Note Payable         1,722         1,769         1,908  
Mortgage escrow deposits           1,755         2,676         1,666  
Accrued expenses and other liabilities         2,156         2,608         2,771  
    Total Liabilities         710,319         694,084         573,275  
                     
Common stock         40         40         40  
Treasury stock         (1,177 )       (1,177 )       (160 )
Additional paid-in capital           106,773         106,729         106,722  
Accumulated deficit           (41,172 )       (42,902 )       (44,178 )
Accumulated other comprehensive loss       (21 )       (120 )       (117 )
    Total Shareholders' Equity       64,443         62,570         62,306  
                     
  Total Liabilities and Shareholders' Equity     $    774,762     $    756,654     $    635,581  
                     

 

                 
PATRIOT NATIONAL BANCORP, INC.

 
STATEMENTS OF OPERATIONS

 
(Unaudited)      Three Months Ended  
Dollars in thousands, except per share data   Mar 31, 2017   Dec 31, 2016   Mar 31, 2016  
                       
Interest and dividend income                  
  Interest and fees on  loans     $   6,607     $   6,579   $   5,840  
  Interest on investment securities       171         140       142  
  Dividends on investment securities       82         90       86  
  Other interest income         64         25       41  
    Total interest and dividend income     6,924         6,834       6,109  
                       
Interest expense                    
  Interest on deposits         989         724       473  
  Interest on Federal Home Loan Bank borrowings       78         113       121  
  Interest on Note Payable - long term senior debt     229         25       -   
  Interest on subordinated debt         85         84       82  
  Interest on other borrowings         9         11       8  
    Total interest expense       1,390         957       684  
                       
    Net interest income       5,534         5,877       5,425  
                       
(Credit) provision for loan losses         (1,749 )       150       -   
                       
    Net interest income after (credit)            
    provision for loan losses       7,283         5,727       5,425  
                       
Non-interest income                  
  Loan application, inspection and processing fees     21         28       67  
  Fees and service charges         149         149       151  
  Rental Income           94         103       103  
  Loss on sale of investment securities       (78 )       -        -   
  Other income           91         88       89  
    Total non-interest income       277         368       410  
                       
Non-interest expense                  
  Salaries and benefits         2,430         2,155       2,550  
  Occupancy and equipment expense       775         797       780  
  Data processing           120         125       285  
  Professional services and other outside services     652         565       409  
  Advertising and promotional expenses       74         53       117  
  Loan administration and processing expenses     9         24       8  
  Regulatory assessments         179         151       147  
  Insurance expense           59         54       55  
  Material and communications         87         88       93  
  Other operating expenses         309         402       320  
    Total non-interest expense       4,694         4,414       4,765  
                       
    Income before income taxes       2,866         1,681       1,070  
Expense for Income taxes           1,136         636       418  
    Net income     $    1,730     $    1,045   $    651  
                       
    Basic income per share    $   0.44     $   0.27   $   0.17  
    Diluted income per share   $   0.44     $   0.27   $   0.16  
                       

 

                     
PATRIOT NATIONAL BANCORP, INC.

FINANCIAL RATIOS AND OTHER DATA

(Unaudited)

Dollars in thousands, except per share data

                     
            Mar 31, 2017   Dec 31, 2016   Mar 31, 2016
Asset Quality:           
      Nonaccrual loans     $   1,812     $   1,821     $   5,409  
      Other real estate owned       851         851         -   
      Total nonperforming assets $   2,663     $   2,672     $   5,409  
                     
                     
    Nonaccrual loans / loans     0.29 %     0.31 %     1.11 %
    Nonperforming assets / assets   0.34 %     0.35 %     0.85 %
    Allowance for loan losses   $   5,697     $   4,675     $   5,247  
    Allowance for loan losses / loans   0.90 %     0.80 %     1.08 %
    Allowance / nonaccrual loans   314.4 %     256.7 %     97.0 %
    Gross loan charge-offs for the quarter $   -      $   2,935     $   5  
    Gross loan (recoveries) for the quarter $   (2,771 )   $   (132 )   $   (10 )
    Net loan charge-offs (recoveries) for the quarter   $   (2,771 )   $   2,803     $   (6 )
                     
                     
Capital Data:           
    Book value per share (1)   $   16.55     $   16.08     $   15.75  
    Shares outstanding       3,894,128         3,891,897         3,956,207  
                     
                     
(1)  Book value per share represents shareholders' equity divided by outstanding shares. 
Contact:
Patriot Bank, N.A.900 Bedford StreetStamford, CT  06901
www.BankPatriot.comMichael Carrazza
CEO & Chairman
203-251-8230

Source: Patriot National Bancorp, Inc.

This article appears in: News Headlines

Referenced Stocks: PNBK


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