0000950170-22-020340.txt : 20221027 0000950170-22-020340.hdr.sgml : 20221027 20221027165158 ACCESSION NUMBER: 0000950170-22-020340 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 13 CONFORMED PERIOD OF REPORT: 20221027 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20221027 DATE AS OF CHANGE: 20221027 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PEAPACK GLADSTONE FINANCIAL CORP CENTRAL INDEX KEY: 0001050743 STANDARD INDUSTRIAL CLASSIFICATION: COMMERCIAL BANKS, NEC [6029] IRS NUMBER: 223537895 STATE OF INCORPORATION: NJ FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-16197 FILM NUMBER: 221337935 BUSINESS ADDRESS: STREET 1: 500 HILLS DRIVE CITY: BEDMINSTER STATE: NJ ZIP: 07921 BUSINESS PHONE: 9082340700 MAIL ADDRESS: STREET 1: 500 HILLS DRIVE CITY: BEDMINSTER STATE: NJ ZIP: 07921 8-K 1 pgc-20221027.htm 8-K 8-K
0001050743false00010507432022-10-272022-10-27

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

____________

 

FORM 8-K

 

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

 

Date of report (Date of earliest event reported)

October 27, 2022

 

PEAPACK-GLADSTONE FINANCIAL CORPORATION

(Exact Name of Registrant as Specified in Charter)

 

New Jersey

001-16197

22-3537895

(State or Other Jurisdiction

(Commission

(I.R.S. Employer

  of Incorporation)

File Number)

Identification No.)

 

 

 

500 Hills Drive, Suite 300, Bedminster, New Jersey

07921

(Address of Principal Executive Offices)

(Zip Code)

 

Registrant’s telephone number, including area code

(908) 234-0700

 

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

 

Trading

Symbol(s)

 

Name of each exchange on which registered

Common

 

PGC

 

The NASDAQ Stock Market, LLC

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

 

 

 

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

 

 

 

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

 

 

 

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (240.12b-2 of this chapter).

Emerging growth company

 

 


 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13 (a) of the Exchange Act.

 

 

INFORMATION TO BE INCLUDED IN THE REPORT

 

Item 2.02 Results of Operations and Financial Condition.

 

On October 27, 2022, Peapack-Gladstone Financial Corporation issued a press release reporting earnings and other financial results for three and nine months ended September 30, 2022. A copy of the press release is attached to this Current Report on Form 8-K as Exhibit 99.1 and is incorporated by reference in its entirety.

 

The information disclosed under this Item 2.02, including Exhibit 99.1, shall be considered “furnished” but not “filed” for purposes of the Securities Exchange Act of 1934, as amended.

 

Item 9.01 Financial Statements and Exhibits.

 

(d) Exhibits.

 

Exhibit No.

 

Title

 

 

 

99.1

 

Press Release dated October 27, 2022.

 

 

 

104

 

Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

The press release disclosed in this Item 9.01 as Exhibit 99.1 shall be considered “furnished” but not “filed” for purposes of the Securities Exchange Act of 1934, as amended.

 

 


 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

PEAPACK-GLADSTONE FINANCIAL CORPORATION

 

 

 

Dated: October 27, 2022

By:

/s/ Jeffrey J. Carfora

 

Jeffrey J. Carfora

 

Senior Executive Vice President and Chief Financial Officer

 

 


EX-99.1 2 pgc-ex99_1.htm EX-99.1 EX-99.1

Exhibit 99.1

Contact:

Jeffrey J. Carfora, SEVP and CFO

Peapack-Gladstone Financial Corporation

T: 908-719-4308

PEAPACK-GLADSTONE FINANCIAL CORPORATION

REPORTS STRONG THIRD QUARTER RESULTS, AS

NET INTEREST MARGIN CONTINUES TO EXPAND

 

Bedminster, N.J. – October 27, 2022 – Peapack-Gladstone Financial Corporation (NASDAQ Global Select Market: PGC) (the “Company”) announces its third quarter 2022 results.

This earnings release should be read in conjunction with the Company’s Q3 2022 Investor Update, a copy of which is available on our website at www.pgbank.com and via a current report on Form 8-K on the website of the Securities and Exchange Commission at www.sec.gov.

The Company recorded total revenue of $61.91 million, net income of $20.13 million and diluted earnings per share (“EPS”) of $1.09 for the quarter ended September 30, 2022, compared to revenue of $52.99 million, net income of $14.17 million and diluted EPS of $0.74 for the three months ended September 30, 2021.

The Company’s return on average assets, return on average equity, and return on average tangible equity totaled 1.30%, 15.21% and 16.73%, respectively, for the September 2022 quarter.

The September 2022 quarter results were driven by continued improvement in net interest income and net interest margin, which improved $10.3 million and 56 basis points, when compared to the September 2021 quarter (and $2.6 million and 15 basis points when compared to the June 2022 quarter). This benefit was partially offset by a decline in noninterest income, principally wealth management fee income and capital markets activity fee income, due to volatility in the markets.

The September 2022 quarter included a $571,000 fair value adjustment on an equity security held for CRA investment purposes. This adjustment reduced total revenue by $571,000; net income by $414,000; and EPS by $0.03, for the September 2022 quarter.

 

Douglas L. Kennedy, President and CEO said, “Our third quarter 2022 results continued to reflect the asset sensitivity of our loan portfolio, as loans continued to reprice upward in the rising rate environment.”

 

Mr. Kennedy also noted, "As previously announced, the Company has entered the Life Insurance Premium Finance business. Life insurance premium finance is a safe and profitable business, and we believe it is the next logical step in our growth plan. While Q4 of 2022 will include some level of loan originations, the business is expected to be fully operational at the beginning of 2023."

The following are select highlights:

 

Peapack Private Wealth Management:

 

AUM/AUA in our Peapack Private Wealth Management Division totaled $9.3 billion at September 30, 2022.
Gross new business inflows for Q3 2022 totaled $219 million (and for the first nine months of 2022 totaled $775 million).
Wealth Management fee income of $12.9 million for Q3 2022 comprised 21% of total revenue for the quarter.
Successfully opened our new Summit Wealth Management office, which has consolidated the teams of several previously acquired firms with legacy Peapack Private team members.

1


 

 

Commercial Banking and Balance Sheet Management:

 

The net interest margin ("NIM") improved by 15 basis points in Q3 2022 compared to Q2 2022 and improved 56 basis points when compared to Q3 2021.
During the third quarter of 2022, the Company successfully migrated $287 million of interest-bearing checking into noninterest-bearing demand deposits.
Noninterest-bearing demand deposits comprised 25% of total deposits as of September 30, 2022.
Core deposits (which includes noninterest-bearing demand and interest-bearing demand, savings and money market accounts) totaled 91% of total deposits at September 30, 2022.
Commercial & industrial lending (“C&I”) loan/lease balances comprised 40% of the total loan portfolio at September 30, 2022.
Total loans grew 7% (9% annualized) to $5.19 billion at September 30, 2022 compared to $4.84 billion at December 31, 2021.
Fee income on unused commercial lines of credit totaled $818,000 for Q3 2022.

 

 

Capital Management:

 

Repurchased 290,399 shares of Company stock for a total cost of $9.9 million during Q3 2022. (790,277 shares of Company stock for a total cost of $27.5 million were repurchased during the first nine months of 2022.)
At September 30, 2022, Regulatory Tier 1 Leverage Ratio stood at 10.8% for Peapack-Gladstone Bank (the "Bank") and 8.7% for the Company; and Regulatory Common Equity Tier 1 Ratio (to Risk-Weighted Assets) stood at 13.5% for the Bank and 10.9% for the Company. These ratios have increased from June 30, 2022 levels (and from December 31, 2021 levels) and are significantly above well capitalized standards, as capital has benefitted from strong net income generation.

SUMMARY INCOME STATEMENT DETAILS:

The following tables summarize specified financial details for the periods shown.

 

September 2022 Year Compared to Prior Year

 

 

 

Nine Months Ended

 

 

Nine Months Ended

 

 

 

 

 

 

 

 

 

 

September 30,

 

 

September 30,

 

 

 

Increase/

 

(Dollars in millions, except per share data)

 

2022

 

 

2021

 

 

 

(Decrease)

 

Net interest income

 

$

128.04

 

 

$

100.85

 

 

 

$

27.19

 

 

 

27

%

Wealth management fee income (A)

 

 

41.67

 

 

 

39.03

 

 

 

 

2.64

 

 

 

7

 

Capital markets activity (B)

 

 

8.30

 

 

 

7.10

 

 

 

 

1.20

 

 

 

17

 

Other income (C)

 

 

(0.36

)

 

 

7.15

 

 

 

 

(7.51

)

 

 

(105

)

Total other income

 

 

49.61

 

 

 

53.28

 

 

 

 

(3.67

)

 

 

(7

)

Operating expenses (A) (D)

 

 

100.39

 

 

 

94.46

 

 

 

 

5.93

 

 

 

6

 

Pretax income before provision for credit losses

 

 

77.26

 

 

 

59.67

 

 

 

 

17.59

 

 

 

29

 

Provision for credit losses

 

 

4.42

 

 

 

2.73

 

 

 

 

1.69

 

 

 

62

 

Pretax income

 

 

72.84

 

 

 

56.94

 

 

 

 

15.90

 

 

 

28

 

Income tax expense/(benefit)

 

 

19.17

 

 

 

15.17

 

 

 

 

4.00

 

 

 

26

 

Net income

 

$

53.67

 

 

$

41.77

 

 

 

$

11.90

 

 

 

28

%

Diluted EPS

 

$

2.88

 

 

$

2.15

 

 

 

$

0.73

 

 

 

34

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Revenue (E)

 

$

177.65

 

 

$

154.13

 

 

 

$

23.52

 

 

 

15

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average assets annualized

 

 

1.16

%

 

 

0.94

%

 

 

 

0.22

 

 

 

 

Return on average equity annualized

 

 

13.46

%

 

 

10.43

%

 

 

 

3.03

 

 

 

 

 

2


 

(A) The nine months ended September 30, 2022 included nine months of wealth management fee income and expense related to the July 2021 acquisition of Princeton Portfolio Strategies Group, while the nine months ended September 30, 2021 included three months.

(B) Capital markets activity includes fee income from loan level back-to-back swaps, the Small Business Association ("SBA") lending and sale program, corporate advisory and mortgage banking activities.

(C) Other income for the nine months ended September 30, 2022 included a $6.6 million loss on sale of securities associated with a balance sheet repositioning executed in the first quarter of 2022, and a $1.7 million fair value adjustment on a CRA equity security. The September 2021 nine months included a cost of $842,000 related to the termination of interest rate swaps; a $1.4 million gain on loans; $722,000 of fee income related to the referral of Paycheck Protection Program ("PPP") loans to a third party; $455,000 of additional Bank Owned Life Insurance ("BOLI") income related to the receipt of life insurance proceeds; and a $293,000 fair value adjustment on a CRA equity security.

(D) The nine months ended September 2022 and 2021 each included $1.5 million of severance expense related to certain staff reorganizations within several areas of the Bank. The nine months ended September 2021 also included $648,000 of expense related to the redemption of subordinated debt; and $1.4 million related to a swap valuation allowance.

(E) Total revenue equals the sum of net interest income plus total other income.

 

September 2022 Quarter Compared to Prior Year Quarter

 

 

 

Three Months Ended

 

 

 

Three Months Ended

 

 

 

 

 

 

 

 

 

September 30,

 

 

 

September 30,

 

 

Increase/

 

(Dollars in millions, except per share data)

 

2022

 

 

 

2021

 

 

(Decrease)

 

Net interest income

 

$

45.53

 

 

 

$

35.21

 

 

$

10.32

 

 

 

29

%

Wealth management fee income

 

 

12.94

 

 

 

 

13.86

 

 

 

(0.92

)

 

 

(7

)

Capital markets activity (A)

 

 

0.78

 

 

 

 

2.06

 

 

 

(1.28

)

 

 

(62

)

Other income (B)

 

 

2.66

 

 

 

 

1.86

 

 

 

0.80

 

 

 

43

 

Total other income

 

 

16.38

 

 

 

 

17.78

 

 

 

(1.40

)

 

 

(8

)

Operating expenses (C)

 

 

33.56

 

 

 

 

32.18

 

 

 

1.38

 

 

 

4

 

Pretax income before provision for credit losses

 

 

28.35

 

 

 

 

20.81

 

 

 

7.54

 

 

 

36

 

Provision for credit losses

 

 

0.60

 

 

 

 

1.60

 

 

 

(1.00

)

 

 

(63

)

Pretax income

 

 

27.75

 

 

 

 

19.21

 

 

 

8.54

 

 

 

44

 

Income tax expense

 

 

7.62

 

 

 

 

5.04

 

 

 

2.58

 

 

 

51

 

Net income

 

$

20.13

 

 

 

$

14.17

 

 

$

5.96

 

 

 

42

%

Diluted EPS

 

$

1.09

 

 

 

$

0.74

 

 

$

0.35

 

 

 

48

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Revenue (D)

 

$

61.91

 

 

 

$

52.99

 

 

$

8.92

 

 

 

17

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average assets annualized

 

 

1.30

%

 

 

 

0.95

%

 

 

0.35

 

 

 

 

Return on average equity annualized

 

 

15.21

%

 

 

 

10.40

%

 

 

4.81

 

 

 

 

 

(A) Capital markets activity includes fee income from loan level back-to-back swaps, the SBA lending and sale program, corporate advisory and mortgage banking activities.

(B) Other income for the September 2022 and 2021 quarters included a fair value adjustment on a CRA equity security of $571,000 and $70,000, respectively

(C) The September 2021 quarter included $1.4 million of expense related to a swap valuation allowance.

(D) Total revenue equals the sum of net interest income plus total other income.

 

3


September 2022 Quarter Compared to Linked Quarter
 

 

 

Three Months Ended

 

 

Three Months Ended

 

 

 

 

 

 

 

 

 

 

September 30,

 

 

June 30,

 

 

 

Increase/

 

(Dollars in millions, except per share data)

 

2022

 

 

2022

 

 

 

(Decrease)

 

Net interest income

 

$

45.53

 

 

$

42.89

 

 

 

$

2.64

 

 

 

6

%

Wealth management fee income

 

 

12.94

 

 

 

13.89

 

 

 

 

(0.95

)

 

 

(7

)

Capital markets activity (A)

 

 

0.78

 

 

 

2.86

 

 

 

 

(2.08

)

 

 

(73

)

Other income (B)

 

 

2.66

 

 

 

1.76

 

 

 

 

0.90

 

 

 

51

 

Total other income

 

 

16.38

 

 

 

18.51

 

 

 

 

(2.13

)

 

 

(12

)

Operating expenses

 

 

33.56

 

 

 

32.66

 

 

 

 

0.90

 

 

 

3

 

Pretax income before provision for credit losses

 

 

28.35

 

 

 

28.74

 

 

 

 

(0.39

)

 

 

(1

)

Provision for credit losses

 

 

0.60

 

 

 

1.45

 

 

 

 

(0.85

)

 

 

(59

)

Pretax income

 

 

27.75

 

 

 

27.29

 

 

 

 

0.46

 

 

 

2

 

Income tax expense

 

 

7.62

 

 

 

7.19

 

 

 

 

0.43

 

 

 

6

 

Net income

 

$

20.13

 

 

$

20.10

 

 

 

$

0.03

 

 

 

0

%

Diluted EPS

 

$

1.09

 

 

$

1.08

 

 

 

$

0.01

 

 

 

1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Revenue (C)

 

$

61.91

 

 

$

61.40

 

 

 

$

0.51

 

 

 

1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average assets annualized

 

 

1.30

%

 

 

1.30

%

 

 

 

0.00

 

 

 

 

Return on average equity annualized

 

 

15.21

%

 

 

15.43

%

 

 

 

(0.22

)

 

 

 

 

(A) Capital markets activity includes fee income from loan level back-to-back swaps, the SBA lending and sale program, corporate advisory and mortgage banking activities.

(B) Other income for the September 2022 and June 2022 quarters included a fair value adjustment on a CRA equity security of $571,000 and $475,000, respectively.

(C) Total revenue equals the sum of net interest income plus total other income.

SUPPLEMENTAL QUARTERLY DETAILS:

 

Peapack Private Wealth Management

In the September 2022 quarter, the Bank’s wealth management business, Peapack Private Wealth Management ("PPWM"), generated $12.94 million in fee income, compared to $13.89 million for the June 30, 2022 quarter and $13.86 million for the September 2021 quarter. Continued market declines in 2022 further impacted the results in the September 2022 quarter, as the S&P decreased another 5% in Q3 2022 (and YTD down 25%).

 

John Babcock, President of Peapack Private Wealth Management noted, “Notwithstanding broad market forces that have negatively impacted both the equities and bond markets, and with economic challenges ahead, our business is sound and continues to attract new clients as well as additional funds from existing relationships. In Q3 2022, total new accounts and client additions totaled $219 million which brings our nine-month 2022 total to $775 million, an annualized pace consistent with the last several years. As we enter Q4 2022, our new business pipeline is healthy, and we remain focused on delivering excellent service and advice to our clients during these turbulent times. Our highly skilled professionals, our fiduciary powers and expertise, our financial planning capabilities and our high-touch client service model distinguishes PPWM in our market and are the drivers behind our growth and success.”

Loans / Commercial Banking

Total loans grew 7% (9% annualized) to $5.19 billion at September 30, 2022 compared to $4.84 billion at December 31, 2021.

Total C&I loans and leases at September 30, 2022 were $2.10 billion or 40% of the total loan portfolio.

4


Mr. Kennedy noted, “Our loan growth has historically been strong however, given economic uncertainty and rising interest rates, we believe loan demand will subside somewhat. Further, we have tightened our initial underwriting in anticipation of a potential economic downturn and higher rate environment. Given that, we believe we will achieve modest growth for the remainder of 2022, resulting in mid to high single digit growth for all of 2022.”

Mr. Kennedy also noted, “We are proud to have built a leading middle market commercial banking franchise, as evidenced by our C&I Portfolio, Treasury Management services, and Corporate Advisory and SBA businesses. Additionally, we are encouraged by the expansion into the Life Insurance Premium Finance business and believe it will prove to be a safe and profitable business line that aligns with the Company's strategy.”

Net Interest Income (NII)/Net Interest Margin (NIM)

 

 

Nine Months Ended

 

Nine Months Ended

 

 

 

 

 

 

September 30, 2022

 

September 30, 2021

 

 

 

 

 

 

NII

 

 

NIM

 

NII

 

 

NIM

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NII/NIM excluding the below

$

126,643

 

 

2.84%

 

$

97,655

 

 

2.53%

 

 

 

 

 

Prepayment premiums received on loan paydowns

 

912

 

 

0.02%

 

 

1,530

 

 

0.03%

 

 

 

 

 

Effect of maintaining excess interest earning cash

 

485

 

 

-0.03%

 

 

(365

)

 

-0.17%

 

 

 

 

 

Effect of PPP loans

 

 

 

0.00%

 

 

2,029

 

 

-0.04%

 

 

 

 

 

NII/NIM as reported

$

128,040

 

 

2.83%

 

$

100,849

 

 

2.35%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Three Months Ended

 

Three Months Ended

 

September 30, 2022

 

June 30, 2022

 

September 30, 2021

 

NII

 

 

NIM

 

NII

 

 

NIM

 

NII

 

 

NIM

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NII/NIM excluding the below

$

44,728

 

 

2.99%

 

$

42,526

 

 

2.83%

 

$

34,635

 

 

2.56%

Prepayment premiums received on loan paydowns

 

305

 

 

0.02%

 

 

255

 

 

0.02%

 

 

325

 

 

0.02%

Effect of maintaining excess interest earning cash

 

492

 

 

-0.03%

 

 

112

 

 

-0.02%

 

 

(46

)

 

-0.14%

Effect of PPP loans

 

 

 

0.00%

 

 

 

 

0.00%

 

 

297

 

 

-0.02%

NII/NIM as reported

$

45,525

 

 

2.98%

 

$

42,893

 

 

2.83%

 

$

35,211

 

 

2.42%

The Company’s reported NII and NIM for Q3 2022 increased $2.6 million and 15 basis points, respectively, compared to the linked quarter (Q2 2022) and $10.3 million and 56 basis points compared to the prior year quarter (Q3 2021). When comparing to the prior year quarter the Bank grew its loan portfolio at rates/spreads beneficial to NIM, while reducing lower-yielding liquidity. Additionally, the Bank benefitted from the increases in LIBOR and the Prime rate during 2022.

Mr. Kennedy stated, “As noted above, we benefitted from the increases in LIBOR and Prime during 2022 and our loan portfolio is positioned to continue to benefit from a rise in interest rates. 23% of our loan portfolio reprices within one-month; 36% within three-months and 46% ($2.4 billion) within one year. Our current modeling, with an average deposit beta assumption of 45% on a go-forward basis, indicates net interest income will improve approximately 2.2% in year one and 5.8% in year two, after a 150-basis point rate shock.”

Funding / Liquidity / Interest Rate Risk Management

The Company actively manages its deposit base to reduce reliance on wholesale funding, volatility, and/or operational risk. Total deposits increased $33 million to $5.30 billion at September 30, 2022 from $5.27 billion at December 31, 2021 and decreased $105 million from $5.40 billion at June 30, 2022. The deposit outflows for the quarter included large relationships strategically utilizing their funds, including investing into our Wealth Management business, acquisitions, further investing in their business, and purchasing real estate and other investments. As noted previously, during the third quarter of 2022, the Company successfully migrated $287 million of interest-bearing checking into noninterest-bearing demand deposits.

5


Mr. Kennedy noted, “91% of our deposits are demand, savings, or money market accounts, and our noninterest bearing deposits comprise 25% of our total deposits; both metrics reflect the core nature of our deposit base.”

At September 30, 2022, the Company’s balance sheet liquidity (investments available for sale, interest-earning deposits and cash) totaled $634.1 million (or 10% of assets).

The Company maintains backup liquidity of approximately $1.8 billion of secured available funding with the Federal Home Loan Bank and $1.7 billion of secured funding from the Federal Reserve Discount Window. The available funding from the Federal Home Loan Bank and the Federal Reserve are secured by the Company’s loan and investment portfolios.

Income from Capital Markets Activities

Noninterest income from Capital Markets activities (detailed below) totaled $784,000 for the September 2022 quarter compared to $2.86 million for the June 2022 quarter and $2.06 million for the September 2021 quarter. The June 2022 quarter results were driven by $2.68 million in gains on sales of SBA loans. The September 2021 quarter reflected $1.57 million in gains on the sale of SBA loans and increased mortgage banking activity due to greater refinance activity in the low-rate environment.

 

 

 

Nine Months Ended

 

 

Nine Months Ended

 

 

 

 

 

 

September 30,

 

 

September 30,

 

 

 

 

(Dollars in thousands, except per share data)

 

2022

 

 

2021

 

 

 

 

Gain on loans held for sale at fair value (Mortgage banking)

 

$

458

 

 

$

1,842

 

 

 

 

Fee income related to loan level, back-to-back swaps

 

 

 

 

 

 

 

 

 

Gain on sale of SBA loans

 

 

6,141

 

 

 

3,950

 

 

 

 

Corporate advisory fee income

 

 

1,696

 

 

 

1,303

 

 

 

 

Total capital markets activity

 

$

8,295

 

 

$

7,095

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

Three Months Ended

 

 

Three Months Ended

 

 

 

September 30,

 

 

June 30,

 

 

September 30,

 

(Dollars in thousands, except per share data)

 

2022

 

 

2022

 

 

2021

 

Gain on loans held for sale at fair value (Mortgage banking)

 

$

60

 

 

$

151

 

 

$

408

 

Fee income related to loan level, back-to-back swaps

 

 

 

 

 

 

 

 

 

Gain on sale of SBA loans

 

 

622

 

 

 

2,675

 

 

 

1,569

 

Corporate advisory fee income

 

 

102

 

 

 

33

 

 

 

84

 

Total capital markets activity

 

$

784

 

 

$

2,859

 

 

$

2,061

 

Other Noninterest Income (other than Wealth Management fee income and Income from Capital Markets Activities)

Other noninterest income was $2.66 million for Q3 2022 compared to $1.76 million for Q2 2022 and $1.86 million for Q3 2021. Q3 2022 included $818,000 of unused line fees compared to $529,000 for Q2 2022 and $163,000 for Q3 2021. Additionally, Q3 2022 included $547,000 of income recorded by the Equipment Finance Division related to equipment transfers to lessees.

Operating Expenses

The Company’s total operating expenses were $33.56 million for the quarter ended September 30, 2022, compared to $32.66 million for the June 2022 quarter and $32.19 million for the September 2021 quarter. The 2022 quarters included increased costs related to health insurance and corporate insurance, as well as normal annual merit increases and year-end bonuses. The September 2021 quarter included $1.4 million related to a swap valuation allowance.

Mr. Kennedy noted, “While we continue to manage expenses closely and prudently, we have and will continue to invest in our existing people as the market demands in order to retain the talent we have acquired. We will

6


also grow and expand our core wealth management and commercial banking businesses, including strategic hires and lift-outs, and invest in digital enhancements to further enhance the client experience.”

Income Taxes

 

The effective tax rate for the three months ended September 30, 2022 was 27.47%, as compared to 26.35% for the June 2022 quarter and 26.22% for the quarter ended September 30, 2021, reflecting higher pre-tax income.

 

Asset Quality / Provision for Credit Losses

Nonperforming assets (which does not include troubled debt restructured loans that are performing in accordance with their terms) were $15.8 million, or 0.26% of total assets at September 30, 2022. Loans past due 30 to 89 days and still accruing were $7.2 million, which included a $5.1 million outstanding loan to a US governmental unit.

Criticized and classified loans totaled $109.6 million at September 30, 2022, reflecting declines from both December 31, 2021 and June 30, 2022 levels.

The Company currently has no loans or leases on deferral and accruing. (During the COVID-19 pandemic, $914 million was on deferral status at June 30, 2020).

On January 1, 2022, the Company implemented Current Expected Credit Losses (“CECL”) methodology for calculating the Company’s Allowance for Credit Losses (“ACL”). The day one CECL adjustment totaled $5.5 million (a reduction to December 31, 2021 ACL, and benefit to Capital, net of tax effect).

For the quarter ended September 30, 2022, the Company’s provision for credit losses was $599,000 compared to $1.4 million for the June 2022 quarter and $1.6 million for the September 2021 quarter. The provision for credit losses in the September 2022 was lower, when compared to the June 2022 and September 2021 quarters, principally driven by modest loan growth when compared to prior periods.

At September 30, 2022, the ACL was $59.68 million (1.15% of total loans), compared to $59.02 million (1.14% of loans) at June 30, 2022. The ALLL at December 31, 2021 (before adoption of CECL) was $61.70 million (1.27% of loans).

Capital

The Company’s capital position during the September 2022 quarter was benefitted by net income of $20.13 million which was partially offset by the repurchase of 290,399 shares through the Company’s stock repurchase program at a total cost of $9.9 million and the quarterly dividend of $909,000. U.S. Generally Accepted Accounting Principles (“GAAP”) Capital at September 30, 2022 was also impacted by a $23.6 million increase in the unrealized loss on available-for-sale securities in the third quarter of 2022 due to the significant rise in medium-term Treasury yields.

Mr. Kennedy noted, “Despite capital spent on stock repurchases, and capital being affected by the increased unrealized loss on AFS securities, our tangible book value per share improved slightly during Q3 2022 to $26.10 at September 30, 2022.”

The Company’s and Bank’s regulatory capital ratios as of September 30, 2022 remain strong, and reflect increases from June 30, 2022 and December 31, 2021 levels. Where applicable, such ratios remain well above regulatory well capitalized standards.

The Company employs quarterly capital stress testing – adverse case and severely adverse case. In the most recent completed stress test (as of June 30, 2022), under the severely adverse case, and no growth scenario, the Bank remains well capitalized over a two-year stress period. With an additional stress overlay (impacting the industries most affected by the Pandemic more severely), the Bank still remains well capitalized over the two-year stress period.

On October 27, 2022, the Company declared a cash dividend of $0.05 per share payable on November 28, 2022, to shareholders of record on November 10, 2022.

7


ABOUT THE COMPANY

Peapack-Gladstone Financial Corporation is a New Jersey bank holding company with total assets of $6.1 billion and assets under management/administration of $9.3 billion as of September 30, 2022. Founded in 1921, Peapack-Gladstone Bank is a commercial bank that provides innovative wealth management, commercial and retail solutions, including residential lending and online platforms, to businesses and consumers. Peapack Private, the bank’s wealth management division, offers comprehensive financial, tax, fiduciary and investment advice and solutions to individuals, families, privately-held businesses, family offices and not-for-profit organizations, which help them to establish, maintain and expand their legacy. Together, Peapack-Gladstone Bank and Peapack Private offer an unparalleled commitment to client service. Visit www.pgbank.com and www.peapackprivate.com for more information.

The foregoing may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are not historical facts and include expressions about management’s confidence and strategies and management’s expectations about new and existing programs and products, investments, relationships, opportunities and market conditions. These statements may be identified by such forward-looking terminology as “expect,” “look,” “believe,” “anticipate,” “may” or similar statements or variations of such terms. Actual results may differ materially from such forward-looking statements. Factors that may cause results to differ materially from such forward-looking statements include, but are not limited to:

our ability to successfully grow our business and implement our strategic plan, including our ability to generate revenues to offset the increased personnel and other costs related to the strategic plan;
the impact of anticipated higher operating expenses in 2022 and beyond;
our ability to successfully integrate wealth management firm acquisitions;
our ability to manage our growth;
our ability to successfully integrate our expanded employee base;
an unexpected decline in the economy, in particular in our New Jersey and New York market areas;
declines in our net interest margin caused by the interest rate environment and/or our highly competitive market;
declines in the value in our investment portfolio;
impact from a pandemic event on our business, operations, customers, allowance for credit losses and capital levels;
the continuing impact of the COVID-19 pandemic on our business and results of operation;
higher than expected increases in our allowance for credit losses;
higher than expected increases in loan and lease losses or in the level of delinquent, nonperforming, classified and criticized loans;
inflation and changes in interest rates, which may adversely impact or margins and yields, reduce the fair value of our financial instruments, reduce our loan originations and lead to higher operating costs;
decline in real estate values within our market areas;
legislative and regulatory actions (including the impact of the Dodd-Frank Wall Street Reform and Consumer Protection Act, Basel III and related regulations) that may result in increased compliance costs;
successful cyberattacks against our IT infrastructure and that of our IT and third-party providers;
higher than expected FDIC insurance premiums;
adverse weather conditions;
the current or anticipated impact of military conflict, terrorism or other geopolitical events;
our inability to successfully generate new business in new geographic markets;
a reduction in our lower-cost funding sources;
our inability to adapt to technological changes;
claims and litigation pertaining to fiduciary responsibility, environmental laws and other matters;
our inability to retain key employees;
demands for loans and deposits in our market areas;
adverse changes in securities markets;
changes in accounting policies and practices; and
other unexpected material adverse changes in our operations or earnings.

 

 

8


A discussion of these and other factors that could affect our results is included in our SEC filings, including our Annual Report on Form 10-K for the year ended December 31, 2021. We undertake no duty to update any forward-looking statement to conform the statement to actual results or changes in the Company’s expectations.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements.

(Tables to follow)

 

PEAPACK-GLADSTONE FINANCIAL CORPORATION

SELECTED CONSOLIDATED FINANCIAL DATA

(Dollars in Thousands, except share data)

(Unaudited)

 

 

For the Three Months Ended

 

 

 

Sept 30,

 

 

June 30,

 

 

March 31,

 

 

Dec 31,

 

 

Sept 30,

 

 

 

2022

 

 

2022

 

 

2022

 

 

2021

 

 

2021

 

Income Statement Data:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

$

55,013

 

 

$

48,520

 

 

$

44,140

 

 

$

42,075

 

 

$

40,067

 

Interest expense

 

 

9,488

 

 

 

5,627

 

 

 

4,518

 

 

 

4,863

 

 

 

4,856

 

Net interest income

 

 

45,525

 

 

 

42,893

 

 

 

39,622

 

 

 

37,212

 

 

 

35,211

 

Wealth management fee income

 

 

12,943

 

 

 

13,891

 

 

 

14,834

 

 

 

13,962

 

 

 

13,860

 

Service charges and fees

 

 

1,060

 

 

 

1,063

 

 

 

952

 

 

 

996

 

 

 

959

 

Bank owned life insurance

 

 

299

 

 

 

310

 

 

 

313

 

 

 

308

 

 

 

311

 

Gain on loans held for sale at fair value
   (Mortgage banking) (A)

 

 

60

 

 

 

151

 

 

 

247

 

 

 

352

 

 

 

408

 

Gain/(loss) on loans held for sale at lower of cost or
   fair value

 

 

 

 

 

 

 

 

 

 

 

(265

)

 

 

 

Fee income related to loan level, back-to-back
   swaps (A)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain on sale of SBA loans (A)

 

 

622

 

 

 

2,675

 

 

 

2,844

 

 

 

989

 

 

 

1,569

 

Corporate advisory fee income (A)

 

 

102

 

 

 

33

 

 

 

1,561

 

 

 

2,180

 

 

 

84

 

Other income

 

 

1,868

 

 

 

860

 

 

 

1,254

 

 

 

581

 

 

 

660

 

Loss on securities sale, net (B)

 

 

 

 

 

 

 

 

(6,609

)

 

 

 

 

 

 

Fair value adjustment for CRA equity security

 

 

(571

)

 

 

(475

)

 

 

(682

)

 

 

(139

)

 

 

(70

)

Total other income

 

 

16,383

 

 

 

18,508

 

 

 

14,714

 

 

 

18,964

 

 

 

17,781

 

Salaries and employee benefits (C)

 

 

22,656

 

 

 

21,882

 

 

 

22,449

 

 

 

20,105

 

 

 

19,859

 

Premises and equipment

 

 

4,534

 

 

 

4,640

 

 

 

4,647

 

 

 

4,519

 

 

 

4,459

 

FDIC insurance expense

 

 

510

 

 

 

503

 

 

 

471

 

 

 

402

 

 

 

555

 

Swap valuation allowance

 

 

 

 

 

 

 

 

673

 

 

 

893

 

 

 

1,350

 

Other expenses

 

 

5,860

 

 

 

5,634

 

 

 

5,929

 

 

 

5,785

 

 

 

5,962

 

Total operating expenses

 

 

33,560

 

 

 

32,659

 

 

 

34,169

 

 

 

31,704

 

 

 

32,185

 

Pretax income before provision for credit losses

 

 

28,348

 

 

 

28,742

 

 

 

20,167

 

 

 

24,472

 

 

 

20,807

 

Provision for credit losses (D)

 

 

599

 

 

 

1,449

 

 

 

2,375

 

 

 

3,750

 

 

 

1,600

 

Income before income taxes

 

 

27,749

 

 

 

27,293

 

 

 

17,792

 

 

 

20,722

 

 

 

19,207

 

Income tax expense

 

 

7,623

 

 

 

7,193

 

 

 

4,351

 

 

 

5,867

 

 

 

5,036

 

Net income

 

$

20,126

 

 

$

20,100

 

 

$

13,441

 

 

$

14,855

 

 

$

14,171

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenue (E)

 

$

61,908

 

 

$

61,401

 

 

$

54,336

 

 

$

56,176

 

 

$

52,992

 

Per Common Share Data:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share (basic)

 

$

1.11

 

 

$

1.10

 

 

$

0.73

 

 

$

0.80

 

 

$

0.76

 

Earnings per share (diluted)

 

 

1.09

 

 

 

1.08

 

 

 

0.71

 

 

 

0.78

 

 

 

0.74

 

Weighted average number of common
   shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

18,072,385

 

 

 

18,325,605

 

 

 

18,339,013

 

 

 

18,483,268

 

 

 

18,763,316

 

Diluted

 

 

18,420,661

 

 

 

18,637,340

 

 

 

18,946,683

 

 

 

19,070,594

 

 

 

19,273,831

 

Performance Ratios:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average assets annualized (ROAA)

 

 

1.30

%

 

 

1.30

%

 

 

0.87

%

 

 

0.96

%

 

 

0.95

%

Return on average equity annualized (ROAE)

 

 

15.21

%

 

 

15.43

%

 

 

9.88

%

 

 

10.94

%

 

 

10.40

%

 

9


Return on average tangible common equity (ROATCE) (F)

 

 

16.73

%

 

 

17.00

%

 

 

10.85

%

 

 

12.03

%

 

 

11.43

%

Net interest margin (tax-equivalent basis)

 

 

2.98

%

 

 

2.83

%

 

 

2.69

%

 

 

2.46

%

 

 

2.42

%

GAAP efficiency ratio (G)

 

 

54.21

%

 

 

53.19

%

 

 

62.88

%

 

 

56.44

%

 

 

60.74

%

Operating expenses / average assets annualized

 

 

2.17

%

 

 

2.11

%

 

 

2.22

%

 

 

2.05

%

 

 

2.16

%

 

(A) Gain on loans held for sale at fair value (mortgage banking), fee income related to loan level, back-to-back swaps, gain on sale of SBA loans and corporate advisory fee income are all included in “capital markets activity” as referred to within the earnings release.

(B) Loss on sale of securities was a result of a balance sheet repositioning employed in the March 2022 quarter.

(C) The March 2022 quarter included $1.5 million of severance expense related to corporate restructuring.

(D) Commencing on January 1, 2022, the allowance calculation is based on the CECL methodology. Prior to January 1, 2022, the calculation was based on the incurred loss methodology.

(E) Total revenue equals the sum of net interest income plus total other income.

(F) Return on average tangible common equity is calculated by dividing tangible common equity by annualized net income. See Non-GAAP financial measures reconciliation included in these tables.

(G) Calculated as total operating expenses as a percentage of total revenue. For Non-GAAP efficiency ratio, see the Non-GAAP financial measures reconciliation included in these tables.

 

 

 

 

 

 

10


PEAPACK-GLADSTONE FINANCIAL CORPORATION

SELECTED CONSOLIDATED FINANCIAL DATA

(Dollars in Thousands, except share data)

(Unaudited)

 

 

For the Nine Months Ended

 

 

 

 

 

 

 

 

 

Sept 30,

 

 

Change

 

 

 

2022

 

 

2021

 

 

$

 

 

%

 

Income Statement Data:

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

$

147,673

 

 

$

117,992

 

 

$

29,681

 

 

 

25

%

Interest expense

 

 

19,633

 

 

 

17,143

 

 

 

2,490

 

 

 

15

%

Net interest income

 

 

128,040

 

 

 

100,849

 

 

 

27,191

 

 

 

27

%

Wealth management fee income

 

 

41,668

 

 

 

39,025

 

 

 

2,643

 

 

 

7

%

Service charges and fees

 

 

3,075

 

 

 

2,701

 

 

 

374

 

 

 

14

%

Bank owned life insurance

 

 

922

 

 

 

1,388

 

 

 

(466

)

 

 

-34

%

Gain on loans held for sale at fair value (Mortgage banking) (A)

 

 

458

 

 

 

1,842

 

 

 

(1,384

)

 

 

-75

%

Gain on loans held for sale at lower of cost or fair value (B)

 

 

 

 

 

1,407

 

 

 

(1,407

)

 

 

-100

%

Fee income related to loan level, back-to-back swaps (A)

 

 

 

 

 

 

 

 

 

 

N/A

 

Gain on sale of SBA loans (A)

 

 

6,141

 

 

 

3,950

 

 

 

2,191

 

 

 

55

%

Corporate advisory fee income (A)

 

 

1,696

 

 

 

1,303

 

 

 

393

 

 

 

30

%

Loss on swap termination

 

 

 

 

 

(842

)

 

 

842

 

 

 

-100

%

Other income (C)

 

 

3,982

 

 

 

2,798

 

 

 

1,184

 

 

 

42

%

Loss on securities sale, net (D)

 

 

(6,609

)

 

 

 

 

 

(6,609

)

 

N/A

 

Fair value adjustment for CRA equity security

 

 

(1,728

)

 

 

(293

)

 

 

(1,435

)

 

 

490

%

Total other income

 

 

49,605

 

 

 

53,279

 

 

 

(3,674

)

 

 

-7

%

Salaries and employee benefits (E)

 

 

66,987

 

 

 

61,759

 

 

 

5,228

 

 

 

8

%

Premises and equipment

 

 

13,821

 

 

 

12,646

 

 

 

1,175

 

 

 

9

%

FDIC insurance expense

 

 

1,484

 

 

 

1,669

 

 

 

(185

)

 

 

-11

%

Swap valuation allowance

 

 

673

 

 

 

1,350

 

 

 

(677

)

 

 

-50

%

Other expenses

 

 

17,423

 

 

 

17,039

 

 

 

384

 

 

 

2

%

Total operating expenses

 

 

100,388

 

 

 

94,463

 

 

 

5,925

 

 

 

6

%

Pretax income before provision for credit losses

 

 

77,257

 

 

 

59,665

 

 

 

17,592

 

 

 

29

%

Provision for credit losses (F)

 

 

4,423

 

 

 

2,725

 

 

 

1,698

 

 

 

62

%

Income before income taxes

 

 

72,834

 

 

 

56,940

 

 

 

15,894

 

 

 

28

%

Income tax expense

 

 

19,167

 

 

 

15,173

 

 

 

3,994

 

 

 

26

%

Net income

 

$

53,667

 

 

$

41,767

 

 

$

11,900

 

 

 

28

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenue (G)

 

$

177,645

 

 

$

154,128

 

 

$

23,517

 

 

 

15

%

Per Common Share Data:

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share (basic)

 

$

2.94

 

 

$

2.21

 

 

$

0.73

 

 

 

33

%

Earnings per share (diluted)

 

 

2.88

 

 

 

2.15

 

 

 

0.73

 

 

 

34

%

Weighted average number of common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

18,244,691

 

 

 

18,891,601

 

 

 

(646,910

)

 

 

-3

%

Diluted

 

 

18,652,042

 

 

 

19,390,522

 

 

 

(738,480

)

 

 

-4

%

Performance Ratios:

 

 

 

 

 

 

 

 

 

 

 

 

Return on average assets annualized (ROAA)

 

 

1.16

%

 

 

0.94

%

 

 

0.22

%

 

 

23

%

Return on average equity annualized (ROAE)

 

 

13.46

%

 

 

10.43

%

 

 

3.03

%

 

 

29

%

Return on average tangible common equity (ROATCE) (H)

 

 

14.81

%

 

 

11.40

%

 

 

3.41

%

 

 

30

%

Net interest margin (tax-equivalent basis)

 

 

2.83

%

 

 

2.35

%

 

 

0.48

%

 

 

21

%

GAAP efficiency ratio (I)

 

 

56.51

%

 

 

61.29

%

 

 

(4.78

)%

 

 

-8

%

Operating expenses / average assets annualized

 

 

2.17

%

 

 

2.12

%

 

 

0.05

%

 

 

2

%

 

11


 

(A) Gain on loans held for sale at fair value (mortgage banking), fee income related to loan level, back-to-back swaps, gain on sale of SBA loans and corporate advisory fee income are all included in “capital markets activity” as referred to within the earnings release.

(B) Includes gain on sale of $57 million of PPP loans completed in the nine months ended September 30, 2021.

(C) Includes income of $722,000 from the referral of PPP loans to a third-party firm during the nine months ended September 30, 2021.

(D) Loss on sale of securities was a result of a balance sheet repositioning employed in the March 2022 quarter.

(E) The September 2022 and 2021 nine months ended each included $1.5 million of severance expense related to corporate restructuring.

(F) Commencing on January 1, 2022, the allowance calculation is based on the CECL methodology. Prior to January 1, 2022, the calculation was based on the incurred loss methodology.

(G) Total revenue equals the sum of net interest income plus total other income.

(H) Return on average tangible common equity is calculated by dividing tangible common equity by annualized net income. See Non-GAAP financial measures reconciliation included in these tables.

(I) Calculated as total operating expenses as a percentage of total revenue. For Non-GAAP efficiency ratio, see the Non-GAAP financial measures reconciliation included in these tables.

 

 

 

 

 

 

 

12


PEAPACK-GLADSTONE FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF CONDITION

(Dollars in Thousands)

(Unaudited)

 

 

As of

 

 

 

Sept 30,

 

 

June 30,

 

 

March 31,

 

 

Dec 31,

 

 

Sept 30,

 

 

 

2022

 

 

2022

 

 

2022

 

 

2021

 

 

2021

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

 

$

5,066

 

 

$

6,203

 

 

$

8,849

 

 

$

5,929

 

 

$

9,299

 

Federal funds sold

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning deposits

 

 

103,214

 

 

 

147,222

 

 

 

105,111

 

 

 

140,875

 

 

 

606,913

 

Total cash and cash equivalents

 

 

108,280

 

 

 

153,425

 

 

 

113,960

 

 

 

146,804

 

 

 

616,212

 

Securities available for sale

 

 

497,880

 

 

 

556,791

 

 

 

601,163

 

 

 

796,753

 

 

 

843,779

 

Securities held to maturity

 

 

103,551

 

 

 

105,048

 

 

 

106,816

 

 

 

108,680

 

 

 

 

CRA equity security, at fair value

 

 

12,957

 

 

 

13,528

 

 

 

14,003

 

 

 

14,685

 

 

 

14,824

 

FHLB and FRB stock, at cost (A)

 

 

14,986

 

 

 

13,710

 

 

 

18,570

 

 

 

12,950

 

 

 

12,950

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential mortgage

 

 

519,088

 

 

 

512,341

 

 

 

513,289

 

 

 

501,340

 

 

 

510,878

 

Multifamily mortgage

 

 

1,856,675

 

 

 

1,876,783

 

 

 

1,850,097

 

 

 

1,595,866

 

 

 

1,497,683

 

Commercial mortgage

 

 

638,903

 

 

 

657,812

 

 

 

669,899

 

 

 

662,626

 

 

 

680,107

 

Commercial and industrial loans

 

 

2,099,917

 

 

 

2,048,474

 

 

 

2,041,720

 

 

 

2,009,252

 

 

 

1,833,532

 

Consumer loans

 

 

37,412

 

 

 

37,675

 

 

 

35,322

 

 

 

33,687

 

 

 

30,689

 

Home equity lines of credit

 

 

36,375

 

 

 

36,023

 

 

 

38,604

 

 

 

40,803

 

 

 

42,512

 

Other loans

 

 

259

 

 

 

236

 

 

 

226

 

 

 

238

 

 

 

245

 

Total loans

 

 

5,188,629

 

 

 

5,169,344

 

 

 

5,149,157

 

 

 

4,843,812

 

 

 

4,595,646

 

Less: Allowances for credit losses (B)

 

 

59,683

 

 

 

59,022

 

 

 

58,386

 

 

 

61,697

 

 

 

65,133

 

Net loans

 

 

5,128,946

 

 

 

5,110,322

 

 

 

5,090,771

 

 

 

4,782,115

 

 

 

4,530,513

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Premises and equipment

 

 

23,781

 

 

 

22,804

 

 

 

22,960

 

 

 

23,044

 

 

 

23,123

 

Other real estate owned

 

 

116

 

 

 

116

 

 

 

 

 

 

 

 

 

 

Accrued interest receivable

 

 

17,816

 

 

 

23,468

 

 

 

22,890

 

 

 

21,589

 

 

 

22,790

 

Bank owned life insurance

 

 

47,072

 

 

 

46,944

 

 

 

46,805

 

 

 

46,663

 

 

 

46,510

 

Goodwill and other intangible assets

 

 

47,698

 

 

 

48,082

 

 

 

48,471

 

 

 

48,902

 

 

 

49,333

 

Finance lease right-of-use assets

 

 

3,021

 

 

 

3,209

 

 

 

3,395

 

 

 

3,582

 

 

 

3,769

 

Operating lease right-of-use assets

 

 

13,404

 

 

 

14,192

 

 

 

14,725

 

 

 

9,775

 

 

 

10,307

 

Due from brokers (C)

 

 

 

 

 

 

 

 

120,245

 

 

 

 

 

 

 

Other assets (D)

 

 

67,753

 

 

 

39,528

 

 

 

30,890

 

 

 

62,451

 

 

 

66,175

 

TOTAL ASSETS

 

$

6,087,261

 

 

$

6,151,167

 

 

$

6,255,664

 

 

$

6,077,993

 

 

$

6,240,285

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing demand deposits

 

$

1,317,954

 

 

$

1,043,225

 

 

$

1,023,208

 

 

$

956,482

 

 

$

986,765

 

Interest-bearing demand deposits

 

 

2,149,629

 

 

 

2,456,988

 

 

 

2,362,987

 

 

 

2,287,894

 

 

 

2,355,892

 

Savings

 

 

166,821

 

 

 

168,441

 

 

 

162,116

 

 

 

154,914

 

 

 

168,831

 

Money market accounts

 

 

1,178,112

 

 

 

1,217,516

 

 

 

1,304,017

 

 

 

1,307,051

 

 

 

1,287,686

 

Certificates of deposit – Retail

 

 

345,047

 

 

 

375,387

 

 

 

384,909

 

 

 

409,608

 

 

 

426,981

 

Certificates of deposit – Listing Service

 

 

30,647

 

 

 

31,348

 

 

 

31,348

 

 

 

31,382

 

 

 

31,382

 

Subtotal “customer” deposits

 

 

5,188,210

 

 

 

5,292,905

 

 

 

5,268,585

 

 

 

5,147,331

 

 

 

5,257,537

 

IB Demand – Brokered

 

 

85,000

 

 

 

85,000

 

 

 

85,000

 

 

 

85,000

 

 

 

85,000

 

Certificates of deposit – Brokered

 

 

25,974

 

 

 

25,963

 

 

 

33,831

 

 

 

33,818

 

 

 

33,804

 

Total deposits

 

 

5,299,184

 

 

 

5,403,868

 

 

 

5,387,416

 

 

 

5,266,149

 

 

 

5,376,341

 

Short-term borrowings

 

 

32,369

 

 

 

 

 

 

122,085

 

 

 

 

 

 

 

Paycheck Protection Program Liquidity Facility (E)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

48,496

 

Finance lease liability

 

 

5,003

 

 

 

5,305

 

 

 

5,573

 

 

 

5,820

 

 

 

6,063

 

Operating lease liability

 

 

14,101

 

 

 

14,756

 

 

 

15,155

 

 

 

10,111

 

 

 

10,644

 

Subordinated debt, net

 

 

132,916

 

 

 

132,844

 

 

 

132,772

 

 

 

132,701

 

 

 

132,629

 

Other liabilities (D)

 

 

88,174

 

 

 

74,070

 

 

 

69,237

 

 

 

116,824

 

 

 

123,098

 

TOTAL LIABILITIES

 

 

5,571,747

 

 

 

5,630,843

 

 

 

5,732,238

 

 

 

5,531,605

 

 

 

5,697,271

 

Shareholders’ equity

 

 

515,514

 

 

 

520,324

 

 

 

523,426

 

 

 

546,388

 

 

 

543,014

 

TOTAL LIABILITIES AND

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SHAREHOLDERS’ EQUITY

 

$

6,087,261

 

 

$

6,151,167

 

 

$

6,255,664

 

 

$

6,077,993

 

 

$

6,240,285

 

Assets under management and / or administration at
   Peapack-Gladstone Bank’s Private Wealth Management
   Division (market value, not included above-dollars in billions)

 

$

9.3

 

 

$

9.5

 

 

$

10.7

 

 

$

11.1

 

 

$

10.3

 

 

(A) FHLB means "Federal Home Loan Bank" and FRB means "Federal Reserve Bank."

(B) Commencing on January 1, 2022, the allowance calculation is based on the CECL methodology. Prior to January 1, 2022, the calculation was based on the incurred loss methodology.

13


(C) Includes $120 million due from FHLB related to securities sales at March 31, 2022. The $120 million received on April 1, 2022, was used to reduce short term borrowings.

(D) The change in other assets and other liabilities was primarily due to the change in the fair value of our back-to-back swap program.

(E) Represents funding provided by the Federal Reserve for pledged PPP loans.

 

 

 

14


PEAPACK-GLADSTONE FINANCIAL CORPORATION

SELECTED BALANCE SHEET DATA

(Dollars in Thousands)

(Unaudited)

 

 

As of

 

 

 

Sept 30,

 

 

June 30,

 

 

March 31,

 

 

Dec 31,

 

 

Sept 30,

 

 

 

2022

 

 

2022

 

 

2022

 

 

2021

 

 

2021

 

Asset Quality:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans past due over 90 days and still accruing

 

$

 

 

$

 

 

$

 

 

$

 

 

$

 

Nonaccrual loans

 

 

15,724

 

 

 

15,078

 

 

 

15,884

 

 

 

15,573

 

 

 

25,925

 

Other real estate owned

 

 

116

 

 

 

116

 

 

 

 

 

 

 

 

 

 

Total nonperforming assets

 

$

15,840

 

 

$

15,194

 

 

$

15,884

 

 

$

15,573

 

 

$

25,925

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nonperforming loans to total loans

 

 

0.30

%

 

 

0.29

%

 

 

0.31

%

 

 

0.32

%

 

 

0.56

%

Nonperforming assets to total assets

 

 

0.26

%

 

 

0.25

%

 

 

0.25

%

 

 

0.26

%

 

 

0.42

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Performing TDRs (A)(B)

 

$

2,761

 

 

$

2,272

 

 

$

2,375

 

 

$

2,479

 

 

$

416

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans past due 30 through 89 days and still accruing (C)

 

$

7,248

 

 

$

3,126

 

 

$

606

 

 

$

8,606

 

 

$

1,193

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans subject to special mention

 

$

82,107

 

 

$

98,787

 

 

$

110,252

 

 

$

116,490

 

 

$

115,935

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Classified loans

 

$

27,507

 

 

$

27,167

 

 

$

47,386

 

 

$

50,702

 

 

$

51,937

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Impaired loans

 

$

13,047

 

 

$

13,227

 

 

$

16,147

 

 

$

18,052

 

 

$

26,341

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for credit losses ("ACL"):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Beginning of quarter

 

$

59,022

 

 

$

58,386

 

 

$

61,697

 

 

$

65,133

 

 

$

63,505

 

Day one CECL adjustment

 

 

 

 

 

 

 

 

(5,536

)

 

 

 

 

 

 

Provision for credit losses (D)

 

 

665

 

 

 

646

 

 

 

2,489

 

 

 

3,750

 

 

 

1,600

 

(Charge-offs)/recoveries, net

 

 

(4

)

 

 

(10

)

 

 

(264

)

 

 

(7,186

)

 

 

28

 

End of quarter

 

$

59,683

 

 

$

59,022

 

 

$

58,386

 

 

$

61,697

 

 

$

65,133

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ACL to nonperforming loans

 

 

379.57

%

 

 

391.44

%

 

 

367.58

%

 

 

396.18

%

 

 

251.24

%

ACL to total loans

 

 

1.15

%

 

 

1.14

%

 

 

1.13

%

 

 

1.27

%

 

 

1.42

%

General ACL to total loans (E)

 

 

1.10

%

 

 

1.09

%

 

 

1.09

%

 

 

1.19

%

 

 

1.26

%

 

(A) Amounts reflect troubled debt restructurings (“TDRs”) that are paying according to restructured terms.

(B) Excludes TDRs included in nonaccrual loans in the following amounts: $12.9 million at September 30, 2022; $13.5 million at June 30, 2022; $13.6 million at March 31, 2022; $1.1 million at December 31, 2021 and $4.0 million at September 30, 2021.

(C) Includes $5.1 million outstanding to a U.S. governmental unit at September 30, 2022; and $6.9 million for one equipment lease principally due to administrative issues with the servicer and the lessee/borrower at December 31, 2021.

(D) Commencing on January 1, 2022, the allowance calculation is based on the CECL methodology. Prior to January 1, 2022, the calculation was based on the incurred loss methodology. Provision to roll forward the ACL excludes a credit of $66,000 at September 30, 2022, a provision of $803,000 at June 30, 2022 and a credit of $114,000 at March 31, 2022 related to off-balance sheet commitments.

(E) Total ACL less specific reserves equals general ACL.

15


PEAPACK-GLADSTONE FINANCIAL CORPORATION

SELECTED BALANCE SHEET DATA

(Dollars in Thousands)

(Unaudited)

 

 

As of

 

 

 

September 30,

 

 

December 31,

 

 

September 30,

 

 

 

2022

 

 

2021

 

 

2021

 

Capital Adequacy

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity to total assets (A)

 

 

 

 

8.47

%

 

 

 

 

8.99

%

 

 

 

 

8.70

%

Tangible equity to tangible assets (B)

 

 

 

 

7.75

%

 

 

 

 

8.25

%

 

 

 

 

7.97

%

Book value per share (C)

 

 

 

$

28.77

 

 

 

 

$

29.70

 

 

 

 

$

29.15

 

Tangible book value per share (D)

 

 

 

$

26.10

 

 

 

 

$

27.05

 

 

 

 

$

26.50

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tangible equity to tangible assets excluding other comprehensive loss*

 

 

 

 

8.88

%

 

 

 

 

8.44

%

 

 

 

 

8.11

%

Tangible book value per share excluding other comprehensive loss*

 

 

 

$

30.29

 

 

 

 

$

27.72

 

 

 

 

$

26.99

 

 

*Excludes other comprehensive loss of $75.0 million for the quarter ended September 30, 2022, $12.4 million for the quarter ended December 31, 2021, and $9.0 million for the quarter ended September 30, 2021.

 

 

 

As of

 

 

September 30,

 

December 31,

 

September 30,

 

 

2022

 

2021

 

2021

Regulatory Capital – Holding Company

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tier I leverage

 

$

540,464

 

 

8.70%

 

$

508,231

 

 

8.29%

 

$

501,188

 

 

8.56%

Tier I capital to risk-weighted assets

 

 

540,464

 

 

10.86

 

 

508,231

 

 

10.62

 

 

501,188

 

 

10.97

Common equity tier I capital ratio
   to risk-weighted assets

 

 

540,440

 

 

10.86

 

 

508,207

 

 

10.62

 

 

501,159

 

 

10.97

Tier I & II capital to risk-weighted assets

 

 

733,988

 

 

14.74

 

 

700,790

 

 

14.64

 

 

691,044

 

 

15.12

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Regulatory Capital – Bank

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tier I leverage (E)

 

$

670,717

 

 

10.79%

 

$

612,762

 

 

9.99%

 

$

594,610

 

 

10.15%

Tier I capital to risk-weighted assets (F)

 

 

670,717

 

 

13.48

 

 

612,762

 

 

12.80

 

 

594,610

 

 

13.01

Common equity tier I capital ratio
   to risk-weighted assets (G)

 

 

670,693

 

 

13.48

 

 

612,738

 

 

12.80

 

 

594,581

 

 

13.01

Tier I & II capital to risk-weighted assets (H)

 

 

731,325

 

 

14.69

 

 

672,614

 

 

14.05

 

 

651,841

 

 

14.26

 

(A) Equity to total assets is calculated as total shareholders’ equity as a percentage of total assets at quarter end.

(B) Tangible equity and tangible assets are calculated by excluding the balance of intangible assets from shareholders’ equity and total assets, respectively. Tangible equity as a percentage of tangible assets at quarter end is calculated by dividing tangible equity by tangible assets at quarter end. See Non-GAAP financial measures reconciliation included in these tables.

(C) Book value per common share is calculated by dividing shareholders’ equity by quarter end common shares outstanding.

(D) Tangible book value per share excludes intangible assets. Tangible book value per share is calculated by dividing tangible equity by quarter end common shares outstanding. See Non-GAAP financial measures reconciliation tables.

(E) Regulatory well capitalized standard = 5.00% ($311 million)

(F) Regulatory well capitalized standard = 8.00% ($398 million)

(G) Regulatory well capitalized standard = 6.50% ($324 million)

(H) Regulatory well capitalized standard = 10.00% ($498 million)

 

 

16


PEAPACK-GLADSTONE FINANCIAL CORPORATION

LOANS CLOSED

(Dollars in Thousands)

(Unaudited)

 

 

 

For the Quarters Ended

 

 

 

Sept 30,

 

 

June 30,

 

 

March 31,

 

 

Dec 31,

 

 

Sept 30,

 

 

 

2022

 

 

2022

 

 

2022

 

 

2021

 

 

2021

 

Residential loans retained

 

$

17,885

 

 

$

35,172

 

 

$

41,547

 

 

$

22,953

 

 

$

36,845

 

Residential loans sold

 

 

4,898

 

 

 

9,886

 

 

 

15,669

 

 

 

20,694

 

 

 

24,041

 

Total residential loans

 

 

22,783

 

 

 

45,058

 

 

 

57,216

 

 

 

43,647

 

 

 

60,886

 

Commercial real estate

 

 

7,320

 

 

 

13,960

 

 

 

25,575

 

 

 

16,134

 

 

 

14,944

 

Multifamily

 

 

4,000

 

 

 

74,564

 

 

 

265,650

 

 

 

162,740

 

 

 

120,716

 

Commercial (C&I) loans/leases (A) (B)

 

 

251,249

 

 

 

332,801

 

 

 

143,029

 

 

 

341,886

 

 

 

143,121

 

SBA

 

 

5,682

 

 

 

10,534

 

 

 

26,093

 

 

 

27,630

 

 

 

11,570

 

Wealth lines of credit (A)

 

 

4,450

 

 

 

12,575

 

 

 

9,400

 

 

 

7,500

 

 

 

10,020

 

Total commercial loans

 

 

272,701

 

 

 

444,434

 

 

 

469,747

 

 

 

555,890

 

 

 

300,371

 

Installment loans

 

 

1,253

 

 

 

100

 

 

 

131

 

 

 

94

 

 

 

178

 

Home equity lines of credit (A)

 

 

5,614

 

 

 

3,897

 

 

 

1,341

 

 

 

5,359

 

 

 

2,535

 

Total loans closed

 

$

302,351

 

 

$

493,489

 

 

$

528,435

 

 

$

604,990

 

 

$

363,970

 

 

 

 

For the Nine Months Ended

 

 

 

Sept 30,

 

 

Sept 30,

 

 

 

2022

 

 

2021

 

Residential loans retained

 

$

94,604

 

 

$

89,742

 

Residential loans sold

 

 

30,453

 

 

 

95,346

 

Total residential loans

 

 

125,057

 

 

 

185,088

 

Commercial real estate

 

 

46,855

 

 

 

65,550

 

Multifamily

 

 

344,214

 

 

 

461,545

 

Commercial (C&I) loans (A) (B)

 

 

727,079

 

 

 

413,547

 

SBA (C)

 

 

42,309

 

 

 

86,276

 

Wealth lines of credit (A)

 

 

26,425

 

 

 

15,695

 

Total commercial loans

 

 

1,186,882

 

 

 

1,042,613

 

Installment loans

 

 

1,484

 

 

 

266

 

Home equity lines of credit (A)

 

 

10,852

 

 

 

8,574

 

Total loans closed

 

$

1,324,275

 

 

$

1,236,541

 

(A) Includes loans and lines of credit that closed in the period but not necessarily funded.

(B) Includes equipment finance.

(C) Includes PPP loans of $56 million for the nine months ended September 30, 2021.

 

17


PEAPACK-GLADSTONE FINANCIAL CORPORATION

AVERAGE BALANCE SHEET

(Tax-Equivalent Basis, Dollars in Thousands)

(Unaudited)

 

 

For the Three Months Ended

 

 

 

September 30, 2022

 

 

September 30, 2021

 

 

 

Average

 

 

Income/

 

 

 

 

 

Average

 

 

Income/

 

 

 

 

 

 

Balance

 

 

Expense

 

 

Yield

 

 

Balance

 

 

Expense

 

 

Yield

 

ASSETS:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable (A)

 

$

754,180

 

 

$

2,853

 

 

 

1.51

%

 

$

820,574

 

 

$

2,824

 

 

 

1.38

%

Tax-exempt (A) (B)

 

 

3,226

 

 

 

30

 

 

 

3.72

 

 

 

6,035

 

 

 

64

 

 

 

4.24

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans (B) (C):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgages

 

 

513,864

 

 

 

3,861

 

 

 

3.01

 

 

 

503,621

 

 

 

3,779

 

 

 

3.00

 

Commercial mortgages

 

 

2,510,616

 

 

 

23,121

 

 

 

3.68

 

 

 

2,133,259

 

 

 

16,114

 

 

 

3.02

 

Commercial

 

 

2,016,590

 

 

 

23,362

 

 

 

4.63

 

 

 

1,826,368

 

 

 

16,553

 

 

 

3.63

 

Commercial construction

 

 

12,073

 

 

 

143

 

 

 

4.74

 

 

 

24,596

 

 

 

198

 

 

 

3.22

 

Installment

 

 

38,338

 

 

 

399

 

 

 

4.16

 

 

 

32,219

 

 

 

245

 

 

 

3.04

 

Home equity

 

 

36,706

 

 

 

451

 

 

 

4.91

 

 

 

43,182

 

 

 

357

 

 

 

3.31

 

Other

 

 

263

 

 

 

7

 

 

 

10.65

 

 

 

252

 

 

 

5

 

 

 

7.94

 

Total loans

 

 

5,128,450

 

 

 

51,344

 

 

 

4.00

 

 

 

4,563,497

 

 

 

37,251

 

 

 

3.27

 

Federal funds sold

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning deposits

 

 

232,158

 

 

 

1,162

 

 

 

2.00

 

 

 

413,623

 

 

 

142

 

 

 

0.14

 

Total interest-earning assets

 

 

6,118,014

 

 

 

55,389

 

 

 

3.62

%

 

 

5,803,729

 

 

 

40,281

 

 

 

2.78

%

Noninterest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

 

 

8,296

 

 

 

 

 

 

 

 

 

8,592

 

 

 

 

 

 

 

Allowance for credit losses

 

 

(59,464

)

 

 

 

 

 

 

 

 

(64,100

)

 

 

 

 

 

 

Premises and equipment

 

 

23,580

 

 

 

 

 

 

 

 

 

23,311

 

 

 

 

 

 

 

Other assets

 

 

97,583

 

 

 

 

 

 

 

 

 

201,287

 

 

 

 

 

 

 

Total noninterest-earning assets

 

 

69,995

 

 

 

 

 

 

 

 

 

169,090

 

 

 

 

 

 

 

Total assets

 

$

6,188,009

 

 

 

 

 

 

 

 

$

5,972,819

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Checking

 

$

2,408,206

 

 

$

5,127

 

 

 

0.85

%

 

$

2,098,827

 

 

$

1,177

 

 

 

0.22

%

Money markets

 

 

1,237,975

 

 

 

1,557

 

 

 

0.50

 

 

 

1,257,760

 

 

 

683

 

 

 

0.22

 

Savings

 

 

168,281

 

 

 

5

 

 

 

0.01

 

 

 

152,759

 

 

 

20

 

 

 

0.05

 

Certificates of deposit – retail

 

 

391,340

 

 

 

791

 

 

 

0.81

 

 

 

461,917

 

 

 

836

 

 

 

0.72

 

Subtotal interest-bearing deposits

 

 

4,205,802

 

 

 

7,480

 

 

 

0.71

 

 

 

3,971,263

 

 

 

2,716

 

 

 

0.27

 

Interest-bearing demand – brokered

 

 

85,000

 

 

 

345

 

 

 

1.62

 

 

 

85,000

 

 

 

385

 

 

 

1.81

 

Certificates of deposit – brokered

 

 

25,968

 

 

 

210

 

 

 

3.23

 

 

 

33,796

 

 

 

266

 

 

 

3.15

 

Total interest-bearing deposits

 

 

4,316,770

 

 

 

8,035

 

 

 

0.74

 

 

 

4,090,059

 

 

 

3,367

 

 

 

0.33

 

Borrowings

 

 

3,810

 

 

 

29

 

 

 

3.04

 

 

 

64,332

 

 

 

57

 

 

 

0.35

 

Capital lease obligation

 

 

5,106

 

 

 

61

 

 

 

4.78

 

 

 

6,147

 

 

 

74

 

 

 

4.82

 

Subordinated debt

 

 

132,874

 

 

 

1,363

 

 

 

4.10

 

 

 

132,588

 

 

 

1,358

 

 

 

4.10

 

Total interest-bearing liabilities

 

 

4,458,560

 

 

 

9,488

 

 

 

0.85

%

 

 

4,293,126

 

 

 

4,856

 

 

 

0.45

%

Noninterest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Demand deposits

 

 

1,116,843

 

 

 

 

 

 

 

 

 

997,450

 

 

 

 

 

 

 

Accrued expenses and other liabilities

 

 

83,446

 

 

 

 

 

 

 

 

 

137,387

 

 

 

 

 

 

 

Total noninterest-bearing liabilities

 

 

1,200,289

 

 

 

 

 

 

 

 

 

1,134,837

 

 

 

 

 

 

 

Shareholders’ equity

 

 

529,160

 

 

 

 

 

 

 

 

 

544,856

 

 

 

 

 

 

 

Total liabilities and shareholders’ equity

 

$

6,188,009

 

 

 

 

 

 

 

 

$

5,972,819

 

 

 

 

 

 

 

Net interest income

 

 

 

 

$

45,901

 

 

 

 

 

 

 

 

$

35,425

 

 

 

 

Net interest spread

 

 

 

 

 

 

 

 

2.77

%

 

 

 

 

 

 

 

 

2.33

%

Net interest margin (D)

 

 

 

 

 

 

 

 

2.98

%

 

 

 

 

 

 

 

 

2.42

%

(A) Average balances for available for sale securities are based on amortized cost.

(B) Interest income is presented on a tax-equivalent basis using a 21% federal tax rate.

(C) Loans are stated net of unearned income and include nonaccrual loans.

(D) Net interest income on a tax-equivalent basis as a percentage of total average interest-earning assets.

18


PEAPACK-GLADSTONE FINANCIAL CORPORATION

AVERAGE BALANCE SHEET

(Tax-Equivalent Basis, Dollars in Thousands)

(Unaudited)

 

 

For the Three Months Ended

 

 

 

September 30, 2022

 

 

June 30, 2022

 

 

 

Average

 

 

Income/

 

 

 

 

 

Average

 

 

Income/

 

 

 

 

 

 

Balance

 

 

Expense

 

 

Yield

 

 

Balance

 

 

Expense

 

 

Yield

 

ASSETS:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable (A)

 

$

754,180

 

 

$

2,853

 

 

 

1.51

%

 

$

774,145

 

 

$

3,535

 

 

 

1.83

%

Tax-exempt (A) (B)

 

 

3,226

 

 

 

30

 

 

 

3.72

 

 

 

4,193

 

 

 

40

 

 

 

3.82

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans (B) (C):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgages

 

 

513,864

 

 

 

3,861

 

 

 

3.01

 

 

 

513,666

 

 

 

3,630

 

 

 

2.83

 

Commercial mortgages

 

 

2,510,616

 

 

 

23,121

 

 

 

3.68

 

 

 

2,552,128

 

 

 

21,185

 

 

 

3.32

 

Commercial

 

 

2,016,590

 

 

 

23,362

 

 

 

4.63

 

 

 

2,024,457

 

 

 

19,348

 

 

 

3.82

 

Commercial construction

 

 

12,073

 

 

 

143

 

 

 

4.74

 

 

 

16,186

 

 

 

162

 

 

 

4.00

 

Installment

 

 

38,338

 

 

 

399

 

 

 

4.16

 

 

 

37,235

 

 

 

297

 

 

 

3.19

 

Home equity

 

 

36,706

 

 

 

451

 

 

 

4.91

 

 

 

38,061

 

 

 

331

 

 

 

3.48

 

Other

 

 

263

 

 

 

7

 

 

 

10.65

 

 

 

258

 

 

 

6

 

 

 

9.30

 

Total loans

 

 

5,128,450

 

 

 

51,344

 

 

 

4.00

 

 

 

5,181,991

 

 

 

44,959

 

 

 

3.47

 

Federal funds sold

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning deposits

 

 

232,158

 

 

 

1,162

 

 

 

2.00

 

 

 

164,066

 

 

 

314

 

 

 

0.77

 

Total interest-earning assets

 

 

6,118,014

 

 

 

55,389

 

 

 

3.62

%

 

 

6,124,395

 

 

 

48,848

 

 

 

3.19

%

Noninterest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

 

 

8,296

 

 

 

 

 

 

 

 

 

9,715

 

 

 

 

 

 

 

Allowance for credit losses

 

 

(59,464

)

 

 

 

 

 

 

 

 

(59,629

)

 

 

 

 

 

 

Premises and equipment

 

 

23,580

 

 

 

 

 

 

 

 

 

22,952

 

 

 

 

 

 

 

Other assets

 

 

97,583

 

 

 

 

 

 

 

 

 

96,232

 

 

 

 

 

 

 

Total noninterest-earning assets

 

 

69,995

 

 

 

 

 

 

 

 

 

69,270

 

 

 

 

 

 

 

Total assets

 

$

6,188,009

 

 

 

 

 

 

 

 

$

6,193,665

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Checking

 

$

2,408,206

 

 

$

5,127

 

 

 

0.85

%

 

$

2,493,668

 

 

$

2,330

 

 

 

0.37

%

Money markets

 

 

1,237,975

 

 

 

1,557

 

 

 

0.50

 

 

 

1,234,564

 

 

 

579

 

 

 

0.19

 

Savings

 

 

168,281

 

 

 

5

 

 

 

0.01

 

 

 

163,062

 

 

 

5

 

 

 

0.01

 

Certificates of deposit – retail

 

 

391,340

 

 

 

791

 

 

 

0.81

 

 

 

411,202

 

 

 

651

 

 

 

0.63

 

Subtotal interest-bearing deposits

 

 

4,205,802

 

 

 

7,480

 

 

 

0.71

 

 

 

4,302,496

 

 

 

3,565

 

 

 

0.33

 

Interest-bearing demand – brokered

 

 

85,000

 

 

 

345

 

 

 

1.62

 

 

 

85,000

 

 

 

364

 

 

 

1.71

 

Certificates of deposit – brokered

 

 

25,968

 

 

 

210

 

 

 

3.23

 

 

 

33,470

 

 

 

261

 

 

 

3.12

 

Total interest-bearing deposits

 

 

4,316,770

 

 

 

8,035

 

 

 

0.74

 

 

 

4,420,966

 

 

 

4,190

 

 

 

0.38

 

Borrowings

 

 

3,810

 

 

 

29

 

 

 

3.04

 

 

 

3,873

 

 

 

10

 

 

 

1.03

 

Capital lease obligation

 

 

5,106

 

 

 

61

 

 

 

4.78

 

 

 

5,406

 

 

 

64

 

 

 

4.74

 

Subordinated debt

 

 

132,874

 

 

 

1,363

 

 

 

4.10

 

 

 

132,803

 

 

 

1,363

 

 

 

4.11

 

Total interest-bearing liabilities

 

 

4,458,560

 

 

 

9,488

 

 

 

0.85

%

 

 

4,563,048

 

 

 

5,627

 

 

 

0.49

%

Noninterest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Demand deposits

 

 

1,116,843

 

 

 

 

 

 

 

 

 

1,029,538

 

 

 

 

 

 

 

Accrued expenses and other liabilities

 

 

83,446

 

 

 

 

 

 

 

 

 

79,882

 

 

 

 

 

 

 

Total noninterest-bearing liabilities

 

 

1,200,289

 

 

 

 

 

 

 

 

 

1,109,420

 

 

 

 

 

 

 

Shareholders’ equity

 

 

529,160

 

 

 

 

 

 

 

 

 

521,197

 

 

 

 

 

 

 

Total liabilities and shareholders’ equity

 

$

6,188,009

 

 

 

 

 

 

 

 

$

6,193,665

 

 

 

 

 

 

 

Net interest income

 

 

 

 

$

45,901

 

 

 

 

 

 

 

 

$

43,221

 

 

 

 

Net interest spread

 

 

 

 

 

 

 

 

2.77

%

 

 

 

 

 

 

 

 

2.70

%

Net interest margin (D)

 

 

 

 

 

 

 

 

2.98

%

 

 

 

 

 

 

 

 

2.83

%

(A) Average balances for available for sale securities are based on amortized cost.

(B) Interest income is presented on a tax-equivalent basis using a 21% federal tax rate.

(C) Loans are stated net of unearned income and include nonaccrual loans.

(D) Net interest income on a tax-equivalent basis as a percentage of total average interest-earning assets.

 

19


PEAPACK-GLADSTONE FINANCIAL CORPORATION

AVERAGE BALANCE SHEET

(Tax-Equivalent Basis, Dollars in Thousands)

(Unaudited)

 

 

For the Nine Months Ended

 

 

 

September 30, 2022

 

 

September 30, 2021

 

 

 

Average

 

 

Income/

 

 

 

 

 

Average

 

 

Income/

 

 

 

 

 

 

Balance

 

 

Expense

 

 

Yield

 

 

Balance

 

 

Expense

 

 

Yield

 

ASSETS:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable (A)

 

$

818,411

 

 

$

9,995

 

 

 

1.63

%

 

$

822,262

 

 

$

8,473

 

 

 

1.37

%

Tax-exempt (A) (B)

 

 

4,035

 

 

 

117

 

 

 

3.87

 

 

 

6,961

 

 

 

243

 

 

 

4.65

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans (B) (C):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgages

 

 

511,999

 

 

 

11,148

 

 

 

2.90

 

 

 

501,276

 

 

 

11,559

 

 

 

3.07

 

Commercial mortgages

 

 

2,472,503

 

 

 

62,481

 

 

 

3.37

 

 

 

1,972,723

 

 

 

45,590

 

 

 

3.08

 

Commercial

 

 

2,016,533

 

 

 

60,911

 

 

 

4.03

 

 

 

1,900,231

 

 

 

49,992

 

 

 

3.51

 

Commercial construction

 

 

15,427

 

 

 

465

 

 

 

4.02

 

 

 

20,418

 

 

 

516

 

 

 

3.37

 

Installment

 

 

36,697

 

 

 

951

 

 

 

3.46

 

 

 

34,724

 

 

 

777

 

 

 

2.98

 

Home equity

 

 

38,324

 

 

 

1,106

 

 

 

3.85

 

 

 

45,672

 

 

 

1,133

 

 

 

3.31

 

Other

 

 

268

 

 

 

18

 

 

 

8.96

 

 

 

239

 

 

 

15

 

 

 

8.37

 

Total loans

 

 

5,091,751

 

 

 

137,080

 

 

 

3.59

 

 

 

4,475,283

 

 

 

109,582

 

 

 

3.26

 

Federal funds sold

 

 

 

 

 

 

 

 

 

 

 

64

 

 

 

 

 

 

0.13

 

Interest-earning deposits

 

 

174,833

 

 

 

1,505

 

 

 

1.15

 

 

 

465,287

 

 

 

367

 

 

 

0.11

 

Total interest-earning assets

 

 

6,089,030

 

 

 

148,697

 

 

 

3.26

%

 

 

5,769,857

 

 

 

118,665

 

 

 

2.74

%

Noninterest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

 

 

8,491

 

 

 

 

 

 

 

 

 

10,018

 

 

 

 

 

 

 

Allowance for credit losses

 

 

(60,026

)

 

 

 

 

 

 

 

 

(67,592

)

 

 

 

 

 

 

Premises and equipment

 

 

23,187

 

 

 

 

 

 

 

 

 

23,087

 

 

 

 

 

 

 

Other assets

 

 

119,908

 

 

 

 

 

 

 

 

 

203,344

 

 

 

 

 

 

 

Total noninterest-earning assets

 

 

91,560

 

 

 

 

 

 

 

 

 

168,857

 

 

 

 

 

 

 

Total assets

 

$

6,180,590

 

 

 

 

 

 

 

 

$

5,938,714

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Checking

 

$

2,411,023

 

 

$

8,695

 

 

 

0.48

%

 

$

1,996,663

 

 

$

3,099

 

 

 

0.21

%

Money markets

 

 

1,255,341

 

 

 

2,675

 

 

 

0.28

 

 

 

1,250,933

 

 

 

2,204

 

 

 

0.23

 

Savings

 

 

162,675

 

 

 

15

 

 

 

0.01

 

 

 

140,066

 

 

 

55

 

 

 

0.05

 

Certificates of deposit – retail

 

 

409,442

 

 

 

2,048

 

 

 

0.67

 

 

 

494,255

 

 

 

3,333

 

 

 

0.90

 

Subtotal interest-bearing deposits

 

 

4,238,481

 

 

 

13,433

 

 

 

0.42

 

 

 

3,881,917

 

 

 

8,691

 

 

 

0.30

 

Interest-bearing demand – brokered

 

 

85,000

 

 

 

1,082

 

 

 

1.70

 

 

 

100,110

 

 

 

1,334

 

 

 

1.78

 

Certificates of deposit – brokered

 

 

31,058

 

 

 

732

 

 

 

3.14

 

 

 

33,783

 

 

 

791

 

 

 

3.12

 

Total interest-bearing deposits

 

 

4,354,539

 

 

 

15,247

 

 

 

0.47

 

 

 

4,015,810

 

 

 

10,816

 

 

 

0.36

 

Borrowings

 

 

20,876

 

 

 

103

 

 

 

0.66

 

 

 

138,448

 

 

 

448

 

 

 

0.43

 

Capital lease obligation

 

 

5,389

 

 

 

193

 

 

 

4.78

 

 

 

6,376

 

 

 

229

 

 

 

4.79

 

Subordinated debt

 

 

132,803

 

 

 

4,090

 

 

 

4.11

 

 

 

165,053

 

 

 

5,650

 

 

 

4.56

 

Total interest-bearing liabilities

 

 

4,513,607

 

 

 

19,633

 

 

 

0.58

%

 

 

4,325,687

 

 

 

17,143

 

 

 

0.53

%

Noninterest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Demand deposits

 

 

1,042,064

 

 

 

 

 

 

 

 

 

932,088

 

 

 

 

 

 

 

Accrued expenses and other liabilities

 

 

93,462

 

 

 

 

 

 

 

 

 

143,045

 

 

 

 

 

 

 

Total noninterest-bearing liabilities

 

 

1,135,526

 

 

 

 

 

 

 

 

 

1,075,133

 

 

 

 

 

 

 

Shareholders’ equity

 

 

531,457

 

 

 

 

 

 

 

 

 

533,894

 

 

 

 

 

 

 

Total liabilities and shareholders’ equity

 

$

6,180,590

 

 

 

 

 

 

 

 

$

5,934,714

 

 

 

 

 

 

 

Net interest income

 

 

 

 

$

129,064

 

 

 

 

 

 

 

 

$

101,522

 

 

 

 

Net interest spread

 

 

 

 

 

 

 

 

2.68

%

 

 

 

 

 

 

 

 

2.21

%

Net interest margin (D)

 

 

 

 

 

 

 

 

2.83

%

 

 

 

 

 

 

 

 

2.35

%

(A) Average balances for available for sale securities are based on amortized cost.

(B) Interest income is presented on a tax-equivalent basis using a 21% federal tax rate.

(C) Loans are stated net of unearned income and include nonaccrual loans.

(D) Net interest income on a tax-equivalent basis as a percentage of total average interest-earning assets.

 

20


PEAPACK-GLADSTONE FINANCIAL CORPORATION

NON-GAAP FINANCIAL MEASURES RECONCILIATION

Tangible book value per share and tangible equity as a percentage of tangible assets at period end are non-GAAP financial measures derived from GAAP-based amounts. We calculate tangible equity and tangible assets by excluding the balance of intangible assets from shareholders’ equity and total assets, respectively. We calculate tangible book value per share by dividing tangible equity by period end common shares outstanding, as compared to book value per common share, which we calculate by dividing shareholders’ equity by period end common shares outstanding. We calculate tangible equity as a percentage of tangible assets at period end by dividing tangible equity by tangible assets at period end. We believe that this is consistent with the treatment by bank regulatory agencies, which exclude intangible assets from the calculation of risk-based capital ratios.

The efficiency ratio is a non-GAAP measure of expense control relative to recurring revenue. We calculate the efficiency ratio by dividing total noninterest expenses, excluding other real estate owned provision, as determined under GAAP, by net interest income and total noninterest income as determined under GAAP, but excluding net gains/(losses) on loans held for sale at lower of cost or fair value and excluding net gains on securities from this calculation, which we refer to below as recurring revenue. We believe that this provides a reasonable measure of core expenses relative to core revenue.

We believe these non-GAAP financial measures provide information that is important to investors and useful in understanding our financial position, results and ratios because our management internally assesses our performance based, in part, on these measures. However, these non-GAAP financial measures are supplemental and are not a substitute for an analysis based on GAAP measures. As other companies may use different calculations for these measures, this presentation may not be comparable to other similarly titles measures reported by other companies. A reconciliation of the non-GAAP measures of tangible common equity, tangible book value per share and efficiency ratio to the underlying GAAP numbers is set forth below.

(Dollars in thousands, except share data)

 

 

Three Months Ended

 

 

 

Sept 30,

 

 

June 30,

 

 

March 31,

 

 

Dec 31,

 

 

Sept 30,

 

Tangible Book Value Per Share

 

2022

 

 

2022

 

 

2022

 

 

2021

 

 

2021

 

Shareholders’ equity

 

$

515,514

 

 

$

520,324

 

 

$

523,426

 

 

$

546,388

 

 

$

543,014

 

Less: Intangible assets, net

 

 

47,698

 

 

 

48,082

 

 

 

48,471

 

 

 

48,902

 

 

 

49,333

 

Tangible equity

 

$

467,816

 

 

$

472,242

 

 

$

474,955

 

 

$

497,486

 

 

$

493,681

 

Less: other comprehensive loss

 

 

(74,983

)

 

 

(58,727

)

 

 

(40,938

)

 

 

(12,374

)

 

 

(9,035

)

Tangible equity excluding other comprehensive loss

 

$

542,799

 

 

$

530,969

 

 

$

515,893

 

 

$

509,860

 

 

$

502,716

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Period end shares outstanding

 

 

17,920,571

 

 

 

18,190,009

 

 

 

18,370,312

 

 

 

18,393,888

 

 

 

18,627,910

 

Tangible book value per share

 

$

26.10

 

 

$

25.96

 

 

$

25.85

 

 

$

27.05

 

 

$

26.50

 

Tangible book value per share excluding other comprehensive loss

 

$

30.29

 

 

$

29.19

 

 

$

28.08

 

 

$

27.72

 

 

$

26.99

 

Book value per share

 

 

28.77

 

 

 

28.60

 

 

 

28.49

 

 

 

29.70

 

 

 

29.15

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tangible Equity to Tangible Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total assets

 

$

6,087,261

 

 

$

6,151,167

 

 

$

6,255,664

 

 

$

6,077,993

 

 

$

6,240,285

 

Less: Intangible assets, net

 

 

47,698

 

 

 

48,082

 

 

 

48,471

 

 

 

48,902

 

 

 

49,333

 

Tangible assets

 

$

6,039,563

 

 

$

6,103,085

 

 

$

6,207,193

 

 

$

6,029,091

 

 

$

6,190,952

 

Less: other comprehensive loss

 

 

(74,983

)

 

 

(58,727

)

 

 

(40,938

)

 

 

(12,374

)

 

 

(9,035

)

Tangible assets excluding other comprehensive loss

 

$

6,114,546

 

 

$

6,161,812

 

 

$

6,248,131

 

 

$

6,041,465

 

 

$

6,199,987

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tangible equity to tangible assets

 

 

7.75

%

 

 

7.74

%

 

 

7.65

%

 

 

8.25

%

 

 

7.97

%

Tangible equity to tangible assets excluding other comprehensive loss

 

 

8.88

%

 

 

8.62

%

 

 

8.26

%

 

 

8.44

%

 

 

8.11

%

Equity to assets

 

 

8.47

%

 

 

8.46

%

 

 

8.37

%

 

 

8.99

%

 

 

8.70

%

 

21


 

 

Three Months Ended

 

 

 

Sept 30,

 

 

June 30,

 

 

March 31,

 

 

Dec 31,

 

 

Sept 30,

 

Return on Average Tangible Equity

 

2022

 

 

2022

 

 

2022

 

 

2021

 

 

2021

 

Net income

 

$

20,126

 

 

$

20,100

 

 

$

13,441

 

 

$

14,855

 

 

$

14,171

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average shareholders’ equity

 

$

529,160

 

 

$

521,197

 

 

$

544,179

 

 

$

543,035

 

 

$

544,856

 

Less: Average intangible assets, net

 

 

47,922

 

 

 

48,291

 

 

 

48,717

 

 

 

49,151

 

 

 

48,757

 

Average tangible equity

 

$

481,238

 

 

$

472,906

 

 

$

495,462

 

 

$

493,884

 

 

$

496,099

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average tangible common equity

 

 

16.73

%

 

 

17.00

%

 

 

10.85

%

 

 

12.03

%

 

 

11.43

%

 

 

 

For the Nine Months Ended

 

 

 

Sept 30,

 

 

Sept 30,

 

Return on Average Tangible Equity

 

2022

 

 

2021

 

Net income

 

$

53,667

 

 

$

41,767

 

 

 

 

 

 

 

 

Average shareholders’ equity

 

$

531,457

 

 

$

533,894

 

Less: Average intangible assets, net

 

 

48,307

 

 

 

45,306

 

Average tangible equity

 

 

483,150

 

 

 

488,588

 

 

 

 

 

 

 

 

Return on average tangible common equity

 

 

14.81

%

 

 

11.40

%

 

 

 

Three Months Ended

 

 

 

Sept 30,

 

 

June 30,

 

 

March 31,

 

 

Dec 31,

 

 

Sept 30,

 

Efficiency Ratio

 

2022

 

 

2022

 

 

2022

 

 

2021

 

 

2021

 

Net interest income

 

$

45,525

 

 

$

42,893

 

 

$

39,622

 

 

$

37,212

 

 

$

35,211

 

Total other income

 

 

16,383

 

 

 

18,508

 

 

 

14,714

 

 

 

18,964

 

 

 

17,781

 

Add:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

   Fair value adjustment for CRA equity security

 

 

571

 

 

 

475

 

 

 

682

 

 

 

139

 

 

 

70

 

Less:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

   Loss/(gain) on loans held for sale

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

   at lower of cost or fair value

 

 

 

 

 

 

 

 

 

 

 

265

 

 

 

 

   Loss on securities sale, net

 

 

 

 

 

 

 

 

6,609

 

 

 

 

 

 

 

Total recurring revenue

 

 

62,479

 

 

 

61,876

 

 

 

61,627

 

 

 

56,580

 

 

 

53,062

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses

 

 

33,560

 

 

 

32,659

 

 

 

34,169

 

 

 

31,704

 

 

 

32,185

 

Less:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

   Swap valuation allowance

 

 

 

 

 

 

 

 

673

 

 

 

893

 

 

 

1,350

 

   Severance expense

 

 

 

 

 

 

 

 

1,476

 

 

 

 

 

 

 

Total operating expense

 

 

33,560

 

 

 

32,659

 

 

 

32,020

 

 

 

30,811

 

 

 

30,835

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Efficiency ratio

 

 

53.71

%

 

 

52.78

%

 

 

51.96

%

 

 

54.46

%

 

 

58.11

%

 

22


 

 

For the Nine Months Ended

 

 

 

Sept 30,

 

 

Sept 30,

 

Efficiency Ratio

 

2022

 

 

2021

 

Net interest income

 

$

128,040

 

 

$

100,849

 

Total other income

 

 

49,605

 

 

 

53,279

 

Add:

 

 

 

 

 

 

   Fair value adjustment for CRA equity security

 

 

1,728

 

 

 

293

 

Less:

 

 

 

 

 

 

   Loss on swap termination

 

 

 

 

 

842

 

   Income from life insurance proceeds

 

 

 

 

 

(455

)

   Loss/(gain) on loans held for sale

 

 

 

 

 

 

   at lower of cost or fair value

 

 

 

 

 

(1,407

)

   Loss on securities sale, net

 

 

6,609

 

 

 

 

Total recurring revenue

 

 

185,982

 

 

 

153,401

 

 

 

 

 

 

 

 

Operating expenses

 

 

100,388

 

 

 

94,463

 

Less:

 

 

 

 

 

 

   Write-off of subordinated debt costs

 

 

 

 

 

648

 

   Swap valuation allowance

 

 

673

 

 

 

1,350

 

   Severance expense

 

 

1,476

 

 

 

1,532

 

Total operating expense

 

 

98,239

 

 

 

90,933

 

 

 

 

 

 

 

 

Efficiency ratio

 

 

52.82

%

 

 

59.28

%

 

 

23


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Entity Address, Address Line One 500 Hills Drive
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Entity Address, Postal Zip Code 07921
City Area Code 908
Local Phone Number 234-0700
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