0001315399FALSE00013153992024-04-012024-06-30


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 18, 2024
PARKE BANCORP, INC.
(Exact name of registrant as specified in its charter)
New Jersey0-51338  65-1241959
(State or other jurisdiction(Commission(IRS Employer
of incorporation)File Number) Identification No.)
601 Delsea Drive, Washington Township, New Jersey
08080
(Address of principal executive offices)  (Zip Code)
Registrant’s telephone number, including area code: (856) 256-2500

Not Applicable
(Former name or former address, if changed since last report)
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:

☐ 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)).
Securities registered pursuant to Section 12(b) of the Act:
Title of Each ClassTrading Symbol(s)Name of Each Exchange on Which Registered
Common Stock, Par Value $0.10 per share PKBKThe Nasdaq Stock Market, LLC
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. ☐


PARKE BANCORP, INC.
INFORMATION TO BE INCLUDED IN THE REPORT

Section 2 - Financial Information

Item 2.02 Results of Operations and Financial Condition.

On October 18, 2024, Parke Bancorp, Inc. issued a press release to report earnings for the three and nine months ended September 30, 2024. A copy of the press release is furnished with this Current Report as Exhibit 99.1 hereto and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended.

Section 9 - Financial Statements and Exhibits.

Item 9.01 Exhibits.

Exhibit No.Description
99.1
104Cover Page Interactive Data File (embedded within the Inline XBRL document)
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, thereunto duly authorized.
PARKE BANCORP, INC.
Date: October 18, 2024By/s/ Jonathan D. Hill
Jonathan D. Hill
Senior Vice President and Chief Financial Officer
(Duly Authorized Representative)














untitleda32.jpg

Parke Bancorp, Inc.
601 Delsea Drive,
Washington Township, NJ 08080

Contact:
Vito S. Pantilione, President and CEO
Jonathan D. Hill, Senior Vice President and CFO
(856) 256-2500

PARKE BANCORP, INC. ANNOUNCES THIRD QUARTER 2024 EARNINGS

Highlights:
Net Income:
$7.5 million for Q3 2024, increased 16.3% over Q2 2024
Revenue:$33.0 million for Q3 2024, increased 5.2% over Q2 2024
Total Assets:
$2.07 billion, increased 2.1% over December 31, 2023
Total Loans:
$1.84 billion, increased 2.9% over December 31, 2023
Total Deposits:
$1.56 billion, increased 0.4% from December 31, 2023
                  
WASHINGTON TOWNSHIP, NJ, October 18, 2024 - Parke Bancorp, Inc. (“Parke Bancorp” or the "Company") (NASDAQ: “PKBK”), the parent company of Parke Bank, announced its operating results for the three and nine months ended September 30, 2024.
Highlights for the three and nine months ended September 30, 2024:
•Net income available to common shareholders was $7.5 million, or $0.63 per basic common share and $0.62 per diluted common share, for the three months ended September 30, 2024, an increase of $6.5 million, or 634.1%, compared to net income available to common shareholders of $1.0 million, or $0.09 per basic common share and $0.08 per diluted common share, for the three months ended September 30, 2023. The increase was primarily due to the non-recurring $9.5 million contingent loss disclosed in Q3 2023, partially offset by a $1.0 million decrease in net interest income, a $0.9 million decrease in non-interest income, and a $0.4 million decrease in provision for credit losses.

•Net interest income decreased $1.0 million, or 6.1%, to $14.7 million for the three months ended September 30, 2024, compared to $15.7 million for the same period in 2023.

•The Company recorded a credit to provision for credit losses of $0.1 million for the three months ended September 30, 2024, compared to a provision for credit losses of $0.3 million for the same period in 2023.

•Non-interest income decreased $0.9 million, or 50.9%, to $0.9 million for the three months ended September 30, 2024, compared to $1.8 million for the same period in 2023.

•Non-interest expense decreased $9.5 million, or 59.8%, to $6.4 million for the three months ended September 30, 2024, compared to $15.8 million for the same period in 2023.

•Net income available to common shareholders was $20.1 million, or $1.68 per basic common share and $1.66 per diluted common share, for the nine months ended September 30, 2024, a decrease of $0.2 million, or 0.8%, compared to net income available to common shareholders of $20.3 million, or $1.70 per basic














common share and $1.67 per diluted common share, for the same period in 2023. The decrease is primarily due to a decrease in net interest income, an increase in provision for credit losses, and a decrease in non-interest income, partially offset by a decrease in non-interest expense.

•Net interest income decreased $5.6 million, or 11.5%, to $43.1 million for the nine months ended September 30, 2024, compared to $48.7 million for the same period in 2023.

•The provision for credit losses increased $2.1 million, or 134.1%, to $0.5 million for the nine months ended September 30, 2024, compared to a recovery of provision for credit losses of $1.6 million for the same period in 2023.

•Non-interest income decreased $2.1 million, or 39.3%, to $3.2 million for the nine months ended September 30, 2024, compared to $5.2 million for the same period in 2023.

•Non-interest expense decreased $9.8 million, or 34.0%, to $19.1 million for the nine months ended September 30, 2024, compared to $29.0 million for the same period in 2023.

The following is a recap of the significant items that impacted the three and nine months ended September 30, 2024:
Interest income increased $3.0 million for the third quarter of 2024 compared to the same period in 2023, primarily due to an increase in interest and fees on loans of $2.9 million, or 10.5%, to $30.2 million, primarily driven by higher market interest rates and higher average portfolio balance. Also, interest earned on average deposits held at the Federal Reserve Bank ("FRB") increased $0.2 million during the three months ended September 30, 2024, due to higher average balances being held on deposit. For the nine months ended September 30, 2024, interest income increased $9.4 million from the same period in 2023, primarily due to an increase in interest and fees on loans of $9.4 million, or 12.1%, to $87.0 million, primarily driven by an increase in average outstanding loan balances, and higher market interest rates.

Interest expense increased $4.0 million, or 29.5%, to $17.4 million for the three months ended September 30, 2024, compared to the same period in 2023, primarily due to higher market interest rates, combined with changes in the mix of deposits and borrowings. For the nine months ended September 30, 2024, interest expense increased $15.0 million, or 44.5%, to $48.7 million, primarily due to higher market interest rates, combined with changes in the mix of deposits and borrowings.

The Company booked a recovery of the provision for credit losses of $0.1 million for the three months ended September 30, 2024, compared to a provision of $0.3 million for the same period in 2023. The credit to provision expense for the three months ended September 30, 2024, was primarily driven by a decrease in the 1 - 4 family investment property loan portfolio qualitative factor rate from the quarter ended June 30, 2024. The provision for credit losses for the nine months ended September 30, 2024, increased $2.1 million, or 134.1%, to $0.5 million, compared to a recovery of $1.6 million for the same period in 2023. The increase was primarily driven by an increase in the outstanding loan balance of $52.6 million from the balance at December 31, 2023, specifically in the construction 1 - 4 family, and multi-family loan portfolios. The provision recovery of $1.6 million during the same period in 2023 was primarily related to decreases in loss factors related to the construction, commercial owner occupied loan portfolios, and residential 1 to 4 family investment property loan portfolio.

Non-interest income decreased $0.9 million, or 50.9%, for the three months ended September 30, 2024 compared to the same period in 2023, primarily as a result of a decrease in service fees on deposit accounts of $0.7 million and a decrease in other income of $0.2 million. For the nine months ended September 30, 2024, non-interest income decreased $2.1 million, or 39.3%, to $3.2 million, compared to the same period in 2023. The decrease was primarily driven by a decrease in service fees on deposit accounts of $2.1 million.

Non-interest expense decreased $9.5 million, or 59.8%, for the three months ended September 30, 2024, compared to the same period in 2023, primarily due to a $9.5 million loss contingency recorded in the third quarter of 2023. For the nine months ended September 30, 2024, non-interest expense decreased $9.8 million,














or 34.0%, to $19.1 million, compared to the same period in 2023, due to the same item driving the quarter-to-date change.

Income tax expense increased $1.6 million for the three months ended September 30, 2024 compared to the same period in 2023. For the nine months ended September 30, 2024, income tax expense decreased $0.2 million, compared to the same period in 2023. The effective tax rate for the three and nine months ended September 30, 2024 were 20.1% and 24.3%, respectively, compared to 24.8% and 23.5% for the same periods in 2023.

September 30, 2024 discussion of financial condition
•Total assets increased to $2.07 billion at September 30, 2024, from $2.02 billion at December 31, 2023, an increase of $41.9 million, or 2.07%, primarily due to an increase in net loans, partially offset by a decrease in cash and cash equivalents.
•Cash and cash equivalents totaled $172.4 million at September 30, 2024, as compared to $180.4 million at December 31, 2023. The decrease in cash and cash equivalents was primarily due to an increase in loan balance, partially offset by an increase in deposits and borrowings.
•The investment securities portfolio decreased to $15.3 million at September 30, 2024, from $16.4 million at December 31, 2023, a decrease of $1.1 million, or 6.8%, primarily due to pay downs of securities.
•Gross loans increased $52.6 million or 2.9%, to $1.84 billion at September 30, 2024.
•Nonperforming loans at September 30, 2024 increased to $12.2 million, representing 0.66% of total loans, an increase of $4.9 million, or 68.0%, from $7.3 million of nonperforming loans at December 31, 2023. OREO at September 30, 2024 was $1.6 million, unchanged from December 31, 2023. Nonperforming assets (consisting of nonperforming loans and OREO) represented 0.67% and 0.44% of total assets at September 30, 2024 and December 31, 2023, respectively. Loans past due 30 to 89 days were $1.2 million at September 30, 2024, an increase of $0.9 million from December 31, 2023.
•The allowance for credit losses was $32.3 million at September 30, 2024, as compared to $32.1 million at December 31, 2023. The ratio of the allowance for credit losses to total loans was 1.76% at September 30, 2024, and 1.80% at December 31, 2023. The ratio of allowance for credit losses to non-performing loans was 264.9% at September 30, 2024, compared to 442.5%, at December 31, 2023.
•Total deposits were $1.56 billion at September 30, 2024, up from $1.55 billion at December 31, 2023, an increase of $6.1 million or 0.4% compared to December 31, 2023. The increase in deposits was primarily driven by an increase in brokered time deposits of $48.4 million and an increase in time deposits of $21.4 million, partially offset by a decrease in non-interest demand deposits and savings deposits of $33.7 million and $25.5 million, respectively.

•Total borrowings increased $20.1 million during the nine months ended September 30, 2024, to $188.3 million at September 30, 2024 from $168.1 million at December 31, 2023, primarily due to $20.0 million of new FHLBNY term borrowings.
.
•Total equity increased to $296.5 million at September 30, 2024, up from $284.3 million at December 31, 2023, an increase of $12.1 million, or 4.3%, primarily due to the retention of earnings, partially offset by the payment of $6.4 million of cash dividends. Book value per common share at September 30, 2024 was $24.92, compared to $23.75 at December 31, 2023.


















CEO outlook and commentary
Vito S. Pantilione, President and Chief Executive Officer of Parke Bancorp, Inc. and Parke Bank, provided the following statement:

"After much speculation and conflicting projections by many economists and other experts, in September 2024 the Federal Reserve reduced interest rates by 50 basis points. In its statement, the Federal Reserve indicated its belief that inflation is going in the right direction and that employment growth is under control. The Federal Reserve further stated that additional rate cuts are possible in the remainder of 2024 and 2025. However, increased geopolitical conflicts with Israel, Iran, Russia, and Ukraine could trigger additional pressure on, among other things, oil prices and could instigate an increase in inflation. Perhaps most importantly, however, we should note the terrible price being paid by the people living in these warring countries. Another concern is that the United States may be drawn into a wider war in the Middle East."

"As reported last quarter, we are seeing an increase in loan activity. Residential construction projects continue to be surprisingly stable and growing. We are also exploring new markets to support growth in our loan portfolio, as well as adding new, experienced commercial loan officers in our lending markets."

"Asset quality and non-interest expense continue to be a primary focus for our bank. While lending is inherently risky, we mitigate that risk with strong loan underwriting and Allowance for Credit Losses. It remains difficult to predict the future, but we are committed to working hard, maintaining tight controls on our non-interest expenses, and continuing to monitor opportunities that may arise in the market."


Forward Looking Statement Disclaimer

This release may contain forward-looking statements. Such forward-looking statements are subject to risks and uncertainties which may cause actual results to differ materially from those currently anticipated due to a number of factors; our ability to maintain a strong capital base, strong earning and strict cost controls; our ability to generate strong revenues with increased interest income and net interest income; our ability to continue the financial strength and growth of our loan portfolio; our ability to continue to increase shareholders’ equity, maintain strong loan underwriting and allowance for credit losses; our ability to react quickly to any increase in loan delinquencies; our ability to face current challenges in the market; our ability to be well positioned to take advantage of opportunities; our ability to continue to reduce our nonperforming loans and delinquencies and the expenses associated with them; our ability to increase the rate of growth of our loan portfolio; our ability to continue to improve net interest margin; our ability to enhance shareholder value in the future; our ability to continue growing our Company, our earnings and shareholders’ equity; the possibility of additional corrective actions or limitations on the operations of the Company. and Parke Bank being imposed by banking regulators, therefore, readers should not place undue reliance on any forward-looking statements. The Company does not undertake, and specifically disclaims, any obligations to publicly release the results of any revisions that may be made to any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such circumstance.

(PKBK-ER)














Financial Supplement:

Table 1: Condensed Consolidated Balance Sheets (Unaudited)
Parke Bancorp, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
September 30,December 31,
20242023
 (Dollars in thousands)
Assets
Cash and cash equivalents$172,449 $180,376 
Investment securities15,269 16,387 
Loans, net of unearned income1,839,929 1,787,340 
Less: Allowance for credit losses(32,318)(32,131)
Net loans 1,807,611 1,755,210 
Premises and equipment, net5,365 5,579 
Bank owned life insurance (BOLI)28,904 28,415 
Other assets35,811 37,534 
   Total assets$2,065,409 $2,023,500 
Liabilities and Equity
Non-interest bearing deposits$198,499 $232,189 
Interest bearing deposits1,360,384 1,320,638 
FHLBNY borrowings145,000 125,000 
Subordinated debentures43,253 43,111 
Other liabilities21,813 18,245 
   Total liabilities1,768,949 1,739,183 
   Total shareholders’ equity 296,460 284,317 
   Total liabilities and equity$2,065,409 $2,023,500 






















Table 2: Consolidated Income Statements (Unaudited)
 
For the three months ended September 30,
For the nine months ended September 30,
 2024202320242023
 (Dollars in thousands, except per share data)
Interest income:
Interest and fees on loans$30,161 $27,294 $86,976 $77,602 
Interest and dividends on investments265 308 761 745 
Interest on deposits with banks1,696 1,512 4,050 4,059 
Total interest income32,122 29,114 91,787 82,406 
Interest expense:
Interest on deposits14,983 11,385 42,123 28,046 
Interest on borrowings2,416 2,046 6,575 5,661 
Total interest expense17,399 13,431 48,698 33,707 
Net interest income14,723 15,683 43,089 48,699 
Provision for (recovery of) credit losses(141)300 546 (1,600)
Net interest income after provision for (recovery of) credit losses14,864 15,383 42,543 50,299 
Non-interest income  
Service fees on deposit accounts321 1,003 1,059 3,149 
Gain on sale of SBA loans(2)— 23 — 
Other loan fees217 192 619 611 
Bank owned life insurance income166 153 488 443 
Other199 449 974 972 
Total non-interest income901 1,835 3,163 5,213 
Non-interest expense  
Compensation and benefits3,178 2,834 9,466 9,414 
Professional services645 659 1,641 1,746 
Occupancy and equipment630 649 1,943 1,938 
Data processing348 368 978 1,037 
FDIC insurance and other assessments319 388 973 960 
OREO expense187 240 776 610 
Other operating expense1,058 10,711 3,358 13,276 
Total non-interest expense6,365 15,849 19,135 28,981 
Income before income tax expense9,400 1,369 26,571 26,531 
Income tax expense1,892 340 6,457 6,242 
Net income attributable to Company7,508 1,029 20,114 20,289 
Less: Preferred stock dividend (5)(7)(16)(20)
Net income available to common shareholders$7,503 $1,022 $20,098 $20,269 
Earnings per common share  
Basic$0.63 $0.09 $1.68 $1.70 
Diluted$0.62 $0.08 $1.66 $1.67 
Weighted average common shares outstanding  
Basic11,959,546 11,945,844 11,960,173 11,945,144 
Diluted12,153,393 12,131,825 12,134,828 12,137,208 

















Table 3: Operating Ratios (unaudited)
Three months endedNine months ended
September 30,September 30,
2024202320242023
Return on average assets1.49 %0.21 %1.37 %1.38 %
Return on average common equity10.08 %1.43 %9.20 %9.77 %
Interest rate spread1.88 %2.24 %1.91 %2.51 %
Net interest margin2.97 %3.21 %2.99 %3.40 %
Efficiency ratio*40.74 %90.47 %41.37 %53.76 %
*     Efficiency ratio is calculated using non-interest expense divided by the sum of net interest income and non-interest income.

Table 4: Asset Quality Data (unaudited)
September 30,December 31,
20242023
(Amounts in thousands except ratio data)
Allowance for credit losses on loans$32,318 $32,131 
Allowance for credit losses to total loans1.76 %1.80 %
Allowance for credit losses to non-accrual loans264.88 %442.51 %
Non-accrual loans$12,201 $7,261 
OREO$1,562 $1,550 



















v3.24.3
Cover
 3 Months Ended
Jun. 30, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Oct. 18, 2024
Entity Registrant Name PARKE BANCORP, INC.
Entity Incorporation, State or Country Code NJ
Entity File Number 0-51338
Entity Tax Identification Number 65-1241959
Entity Address, Address Line One 601 Delsea Drive
Entity Address, City or Town Washington Township
Entity Address, State or Province NJ
Entity Address, Postal Zip Code 08080
City Area Code 856
Local Phone Number 256-2500
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, Par Value $0.10 per share
Trading Symbol PKBK
Security Exchange Name NASDAQ
Entity Emerging Growth Company false
Entity Central Index Key 0001315399
Amendment Flag false
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