AMESBURY, Mass., July 27,
2023 /PRNewswire/ -- Provident Bancorp, Inc.
(the "Company") (NasdaqCM: PVBC), the holding company for BankProv
(the "Bank"), reported net income for the quarter ended
June 30, 2023 of $3.5 million, or $0.21 per diluted share, compared to $2.1 million, or $0.13 per diluted share, for the quarter ended
March 31, 2023, and $5.6 million, or $0.33 per diluted share, for the quarter ended
June 30, 2022. Net income for the six months ended
June 30, 2023 was $5.6 million, or $0.34 per diluted share, compared to $11.1 million, or $0.66 per diluted share, for the six months ended
June 30, 2022.
In announcing these results, Carol
Houle, Co-Chief Executive Officer and Chief Financial
Officer said, "Net interest margin has declined significantly due
to our cost of funds outpacing yield on assets. The ten rate hikes
since the beginning of 2022, coupled with the speed in which
deposits can be moved, has pressured banks to increase deposit
rates at a faster pace to remain competitive."
"It is important, as a leadership team, to evaluate all areas of
revenue and expense to ensure the bank is operating at optimum
efficiency. During the quarter, we have made concerted efforts to
reduce costs and evaluate fees on deposit products to reduce the
negative impact that the increased cost of funds had on our
performance," said Joe Reilly,
Co-Chief Executive Officer.
Mr. Reilly continued, "Our results for the period reflect our
restructured management team and our focus on our revised business
plan, operations, and risk tolerance in light of the events and the
losses that occurred in late 2022. We have made a concerted effort
to adjust our business practices and strategies to better monitor
and manage our risk position, capital position, liquidity, growth
of our Banking as a Service operations, and overall asset
growth. In this regard, we have updated internal metrics and
limitations in these areas to better manage and monitor our overall
risk position, including generally managing overall asset growth to
5% per year, and we have adopted more comprehensive capital
management policies and procedures. We believe these efforts
will assist the Company in implementing a measured growth strategy
that does not create undue operational risk while meeting
supervisory expectations.
Income Statement Results
Quarter Ended June 30, 2023
Compared to Quarter Ended March 31,
2023
For the quarter ended June 30,
2023, net interest and dividend income was $14.9 million, which represents a decrease of
$914,000, or 5.8%, compared to the
quarter ended March 31, 2023. Net
interest and dividend income was negatively impacted by an increase
in interest expense of $3.2 million,
or 65.7%, to $8.0 million compared to
$4.8 million for the quarter ended
March 31, 2023, partially offset by
an increase in interest and dividend income of $2.3 million, or 10.9%, to $22.9 million compared to $20.6 million for the quarter ended March 31, 2023. Interest expense increased
primarily due to an increase in the cost of interest-bearing
deposits and an increase in the average balance of interest-bearing
deposits. The cost of interest-bearing deposits increased 101 basis
points to 3.04% for the quarter ended June 30, 2023, compared
to 2.03% for the quarter ended March 31,
2023, primarily due to rising interest rates and a larger
proportion of the portfolio consisting of higher-cost money market
accounts and certificates of deposit. The average balance of
interest-bearing deposits increased $240.7
million, or 31.3%, for the quarter ended June 30, 2023, primarily due to increases in the
average balances of money market accounts and certificates of
deposit.
Interest and dividend income increased primarily due to an
increase in the average balance of short-term investments of
$195.5 million to $236.4 million as of June
30, 2023, compared to $40.9
million as of March 31,
2023.The increase resulted in an increase of interest earned of
$2.6 million to $3.0 million as of June
30, 2023, compared to $383,000
as of March 31, 2023. The increase
was partially offset by a decrease in interest and fees on loans of
$354,000, or 1.8%, to $19.7 million for the quarter ended June 30, 2023, compared to $20.0 million for the quarter ended March 31, 2023. The decrease was primarily a
result of the $45.3 million decrease
in the average balance of loans.
A credit loss benefit of $1.1
million was recognized for the quarter ended June 30, 2023 due to improvements in the
near-term Gross Domestic Product ("GDP") and unemployment rate
forecasts. Reduced balances in the commercial real estate,
commercial, and enterprise value loan portfolios, which have a
higher credit risk compared to the Bank's other loan portfolios
such as mortgage warehouse and construction and land development
also contributed to the benefit. In addition, updated valuations
increased collateral values for individually analyzed loans in the
enterprise value portfolio, causing a decrease in the reserve for
the quarter ended June 30, 2023.
For the quarter ended June 30,
2023, noninterest income was $1.7
million, which represents a decrease of $245,000, or 12.6%, compared to the quarter ended
March 31, 2023. The decrease was
primarily due to decreases in customer services fees on deposit
accounts and other income, partially offset by an increase in other
service charges. Customer service fees on deposit accounts
decreased $210,000, or 21.5%,
primarily due to decreased fees generated from cash vault services
for our customers who operate Bitcoin ATMs as
management suspended services while they continue to evaluate the
services offered. Included in the customer service fees on deposit
accounts was $238,000 for
implementation and activity fees charged to Banking as a Service
("BaaS") customers for the quarter ended June 30, 2023, compared to $245,000 for the quarter ended March 31, 2023. Other service charges and fees
increased $76,000, or 16.9%,
primarily due to prepayment penalties in our commercial real estate
portfolio. Other income decreased $117,000, or 46.6%, primarily due to a decrease
in sales of other repossessed assets.
For the quarter ended June 30,
2023, noninterest expense was $12.8
million, which represents a decrease of $460,000, or 3.5%, compared to the quarter ended
March 31, 2023. The decrease was
primarily due to decreases in professional fees and salaries and
employee benefits, partially offset by an increase in other
expense. Professional fees decreased $484,000 from $1.4
million to $919,000 primarily
due to decreased legal, audit, and compliance costs which were
elevated for the quarter ended March 31,
2023 due to services pertaining to the events that led to
losses recorded during 2022. Salaries and employee benefits
decreased $435,000 from $8.5 million to $8.1
million due to a reduction in personnel servicing the
enterprise value portfolio. Other expenses increased $198,000 from $672,000 to $870,000 due to loan workout expenses.
Quarter Ended June 30, 2023
Compared to Quarter Ended June 30,
2022
For the quarter ended June 30,
2023, net interest and dividend income was $14.9 million, which represents a decrease of
$3.7 million, or 19.9%, from the
quarter ended June 30, 2022. The net
interest and dividend income for the quarter ended June 30, 2023 was negatively impacted by an
increase in interest expense of $7.4
million to $8.0 million
compared to $547,000 for the quarter
ended June 30, 2022, which was offset
by an increase in interest and dividend income of $3.7 million, or 19.4%, to $22.9 million for the quarter ended June 30, 2023, compared to $19.2 million for the quarter ended June 30, 2022. Interest expense increased
primarily due to rising interest rates and a larger proportion of
higher-cost money market accounts and certificates of deposit in
the portfolio. Rising interest rates resulted in an increase in the
cost of interest-bearing deposits of 280 basis points to 3.04% for
the quarter ended June 30, 2023,
compared to 0.24% for the quarter ended June
30, 2022. The increase in interest expense was also driven
by an increase in the average balance of interest-bearing deposits
of $201.1 million, or 24.9%, to
$1.01 billion for the quarter ended
June 30, 2023, compared to
$807.7 million for the quarter ended
June 30, 2022.
Interest and dividend income increased primarily due to rising
interest rates, which resulted in an increased yield on
interest-earning assets of 121 basis points to 5.67% for the
quarter ended June 30, 2023, compared
to 4.46% for the quarter ended June 30,
2022. The rising interest rates resulted in interest earned
on short-term investments of $3.0
million for the quarter ended June
30, 2023, compared to $400,000
for the quarter ended June 30, 2022
and interest earned on loans of $19.7
million for the quarter ended June
30, 2023, compared to $18.6
million for the quarter ended June
30, 2022. The increase was partially offset by the
$118.3 million, or 8.1%, reduction in
the average balance of loans to $1.35
billion for the quarter ended June
30, 2023 from $1.47 billion
for the quarter ended June 30,
2022.
A credit loss benefit of $1.1
million was recognized for the quarter ended June 30, 2023 due to improvements in the
near-term Gross Domestic Product ("GDP") and unemployment rate
forecasts. Reduced balances in the commercial real estate,
commercial, and enterprise value loan portfolios, which have a
higher credit risk compared to the Bank's other loan portfolios
such as mortgage warehouse and construction and land development
also contributed to the benefit. In addition, updated valuations
increased collateral values for individually analyzed loans in the
enterprise value portfolio, causing a decrease in the reserve for
the quarter ended June 30, 2023.
For the quarter ended June 30,
2023, noninterest income was $1.7
million, which represents an increase of $150,000, or 9.7%, compared to the quarter ended
June 30, 2022. The increase was
primarily due to increases in customer service fees on deposit
accounts and other income, partially offset by a decrease in the
gain on loans sold. Customer service fees on deposit accounts
increased $150,000, or 24.2%, which
was primarily attributable to implementation and activity fees
charged to BaaS customers of $238,000
for the quarter ended June 30, 2023,
compared to $46,000 for the quarter
ended June 30, 2022. Other income
increased $98,000, or 272.2%,
primarily due to insurance proceeds from replacement of damaged
equipment. Gain on loans sold decreased $187,000, or 100%, primarily due to the sale of
residential mortgage loans in June
2022.
For the quarter ended June 30,
2023, noninterest expense was $12.8
million, which represents an increase of $1.4 million, or 12.8%, compared to the quarter
ended June 30, 2022. The increase in
noninterest expense was primarily due to increases in salaries and
employee benefits, deposit insurance expense, professional fees,
and software depreciation and implementation expenses. The increase
of $787,000, or 10.7%, in salary and
employee benefits compared to the quarter ended June 30, 2022 was primarily due to an increase in
staff to support strategic initiatives within our deposit products
and services. Deposit insurance increased $214,000, or 139.0%, primarily due to an increase
in the Federal Deposit Insurance Corporation's ("FDIC") insurance
assessment rate schedules. Professional fees increased $210,000, or 29.6%, primarily due to increased
audit and compliance costs. Software depreciation and
implementation expenses increased $156,000, or 47.7%, primarily due to software
licenses needed for the increased number of staff.
Six Months Ended June 30, 2023
Compared to Six Months Ended June 30,
2022
For the six months ended June 30,
2023, net interest and dividend income was $30.7 million, which represents a decrease of
$5.4 million, or 15.9%, compared to
the six months ended June 30, 2022.
This decrease was primarily attributable to rising interest rates
which resulted in increased costs of interest-bearing deposits and
borrowings. The cost of interest-bearing deposits increased 237
basis points to 2.60% for the six months ended June 30, 2023, compared to 0.23% for the six
months ended June 30, 2022. The cost of borrowings increased
195 basis points to 3.98% for the six months ended June 30, 2023, compared to 2.02% for the six
months ended June 30. 2022. The decrease in net interest and
dividend income was further supported by an increase in average
interest-bearing liabilities of $132.6
million, or 16.2%, which was due to an increase in average
interest-bearing deposits of $85.5
million, or 10.6%, and an increase in the average total
borrowings or $47.1 million, or
338.4%.
Interest and dividend income increased $5.9 million, or 15.7%, to $43.5 million for the six months ended
June 30, 2023, compared to $37.6
million for the six months ended June 30, 2022. The
increase in interest and dividend income for the six months ended
June 30, 2023, compared to the six
months ended June 30, 2022 was primarily driven by an
increase of interest and fees on loans of $2.9 million, or 7.9%, and an increase in
interest on short-term investments of $2.9
million, or 632.2%. The yield on loans increased 78 basis
points to 5.79% for the six months ended June 30, 2023, compared to 5.01% for the six
months ended June 30, 2022. The yield on short-term
investments increased 432 basis points to 4.83% for the six months
ended June 30, 2023, compared to
0.51% for the six months ended June 30, 2022.
A credit loss expense of $712,000
was recognized for the six months ended June
30, 2023, compared to a credit loss expense of $1.1 million for the six months ended
June 30, 2022, which represents a
decrease of $412,000, or 36.7%. The
credit loss expense for the six months ended June 30, 2023 was driven by the need to replenish
the allowance due to $3.6 million of
net charge-offs that occurred during the quarter ended
March 31, 2023 in the enterprise value portfolio. The expense
was partially offset by improvements in the near-term GDP and
unemployment rate forecasts, as well as a reduction of the loan
balances in the commercial real estate, commercial, and enterprise
value loan portfolios, which have a higher credit risk compared to
the Bank's other loan portfolios. Also, updated valuations during
the quarter ended June 30, 2023
increased collateral values for individually analyzed loans in the
enterprise value portfolio partially offset the credit loss expense
for the six months ended June 30,
2023. The $1.1 million
provision for the six months ended June 30,
2022 was based on the incurred loss model, and was primarily
the result of loan portfolio growth.
For the six months ended June 30,
2023, noninterest income was $3.6
million, which represents an increase of $777,000, or 27.1%, compared to the six months
ended June 30, 2022. The increase was
due to customer service fees on deposit accounts and other income,
partially offset by a decrease in gain on loans sold. Customer
service fees increased $548,000 due
to fees generated from cash vault services for our customers who
operate Bitcoin ATMs and implementation and activity
fees charges to BaaS customers. During the quarter ended
June 30, 2023, management suspended
Bitcoin ATM deposit services while they continue to
evaluate the services offered. Implementation and activity fees
charged to BaaS customers for the six months ended June 30, 2023 were $483,000, compared to $79,000 for the six months ended June 30, 2022. Other income increased
$339,000 due to insurance proceeds.
Gain on loans sold decreased $284,000
primarily due to the sale of residential mortgage loans in
June 2022.
For the six months ended June 30,
2023, noninterest expense was $26.0
million, which represents an increase of $3.2 million, or 14.3%. The increase was due to
salaries and employee benefits, professional fees, deposit
insurance expense, software depreciation and implementation
expense, partially offset by a decrease in write downs of other
assets and receivables. Salaries and employee benefits increased
$2.1 million, or 14.8%, primarily due
to an increase in staff to support strategic initiatives within our
deposit products and services. Professional fees increased
$885,000, or 61.6%, due to increased
legal, audit, and compliance costs which were elevated for the
first quarter of 2023 due to services pertaining to the events that
led to losses recorded during 2022. Deposit insurance increased
$341,000, or 111.8%, primarily due to
an increase in the FDIC's insurance assessment rate schedules.
Software depreciation and implementation expenses increased
$279,000, or 44.9%, primarily due to
software licenses needed for the increased staff. In 2022, there
was a write down of an SBA receivable in the first quarter after
the Company evaluated the collectability and determined that
$395,000 was uncollectible.
Balance Sheet Results
June 30, 2023 Compared to
March 31, 2023
Total assets increased $59.4
million, or 3.5%, to $1.76
billion at June 30, 2023,
compared to $1.70 billion at
March 31, 2023. The primary reason
for the increase was increases in cash and cash equivalents and in
net loans. Cash and cash equivalents increased $53.7 million or 22.0% due to increased deposit
balances. The Bank deems select specialty deposits expected to be
short-term as volatile. The Bank held $171.3
million of these deposits as of June
30, 2023, compared to $91.9
million as of March 31, 2023.
These deposits are currently being held as cash in short-term
investments.
Net loans increased $10.2 million,
or 0.8%, and were $1.33 billion at
June 30, 2023, compared to
$1.32 billion at March 31, 2023. The increase was primarily driven
by increases in mortgage warehouse loans of $24.6 million, or 16.5%, and construction
and land development loans of $12.0
million, or 14.1%. The increase in net loans was partially
offset by decreases in the commercial real estate portfolio of
$9.4 million, or 2.1%, the commercial
loan portfolio of $6.4 million, or
3.3%, and digital asset loans. The Bank's continued efforts to
reduce its digital asset lending portfolio resulted in a decrease
of $10.2 million, or 37.9% to
$16.8 million at June 30, 2023. The decrease in the digital asset
loan portfolio was driven by paydowns on the loans secured by
cryptocurrency mining rigs as well as the payoff
of a $5.7 million line of credit.
Total liabilities increased $55.8
million, or 3.7%, to $1.55
billion as of June 30, 2023,
compared to $1.49 billion at
March 31, 2023, primarily due to an
increase in deposits and total borrowings. Deposits were
$1.45 billion as of June 30, 2023, compared to $1.40 billion as of March
31, 2023, which represents an increase of $44.2 million, or 3.1%. The increase in deposits
was primarily related to an increase of $41.2 million, or 18.7% in specialty deposits,
which were $261.0 million as of
June 30, 2023, compared to
$219.8 million as of March 31, 2023. Specialty deposits consist of
deposits from BaaS and digital asset customers. BaaS deposits
totaled $235.6 million as of
June 30, 2023, which represents a
$74.0 million increase from
March 31, 2023. As of June 30,
2023, the Bank considered $171.3
million of the specialty deposit balances to be volatile and
is holding these deposits as cash. Included in BaaS deposits was
$106.6 million related to BaaS
customers whose business model focuses on digital assets, which
represents a $54.9 million increase
from March 31, 2023. Non-BaaS digital
asset deposits totaled $25.3 million
as of June 30, 2023, which represents
a $32.8 million decrease from
March 31, 2023. Total borrowings
increased $11.5 million, or 16.8%, to
$79.8 million as of June 30, 2023, compared to $68.3 million at March 31,
2023 to fund loan growth.
As of June 30, 2023, shareholders'
equity was $215.1 million compared to
$211.5 million at March 31, 2023, which represents an increase of
$3.6 million, or 1.7%. The increase
was primarily due to net income of $3.5
million, stock-based compensation expense of
$332,000, and employee stock
ownership plan shares earned of $169,000, partially offset by other comprehensive
loss of $322,000.
June 30, 2023 Compared to
December 31, 2022
Total assets increased $125.2
million, or 7.7%, to $1.76
billion at June 30, 2023,
compared to $1.64 billion at
December 31, 2022 due to an increase
in cash and cash equivalents, partially offset by decreases in net
loans and other repossessed assets. Cash and cash equivalents
increased $217.2 million, or 269.4%
due to increased deposit balances and a decrease in net loans. The
Bank deems select specialty deposits expected to be short-term as
volatile. The Bank held $171.3
million of these deposits as of June
30, 2023 as cash in short-term investments. No deposits were
held as volatile as of December 31, 2022. Other repossessed
assets decreased $6.1 million due to
the sale of the remaining cryptocurrency mining rigs
that were repossessed during 2022.
Net loans decreased $82.5 million,
or 5.8%, and were $1.33 billion at
June 30, 2023, compared to
$1.42 billion at December 31, 2022. The decrease was primarily
driven by decreases in mortgage warehouse loans of $39.5 million, or 18.5%, commercial loans of
$29.0 million, or 13.4%, commercial
real estate loans of $15.6 million,
or 3.4%, and digital asset loans. The Bank's continued efforts to
reduce its digital asset portfolio resulted in a decrease of
$24.0 million, or 58.9%. The decrease
in the digital asset loan portfolio was driven by paydowns on
outstanding lines of credit as well as the payoff of a $4.8 million loan secured by
cryptocurrency mining rigs during the first
quarter of 2023 and the payoff of a $5.7
million line of credit during the second quarter of 2023.
The decrease in net loans was partially offset by an increase in
the construction and land development portfolio of $25.0 million, or 33.9%.
Total liabilities increased $117.7
million, or 8.2%, to $1.55
billion as of June 30, 2023,
compared to $1.43 billion at
December 31, 2022, primarily due to
an increase in deposits, partially offset by a decrease in
borrowings. Deposits were $1.45
billion as of June 30, 2023,
compared to $1.28 billion as of
December 31, 2022, which represents
an increase of $168.5 million, or
13.2%. The increase in deposits was primarily related to an
increase of $158.2 million in
specialty deposits, which were $261.0
million as of June 30, 2023,
compared to $102.8 million as of
December 31, 2022. Specialty deposits
consist of deposits by BaaS and digital asset customers. BaaS
deposits totaled $235.6 million as of
June 30, 2023, which represents a
$190.3 million increase from
December 31, 2022. As of
June 30, 2023, the Bank considered $171.3 million of the specialty deposit balances
to be volatile and is holding these deposits as cash. Included in
BaaS deposits was $106.6 million
related to BaaS customers whose business model focuses on digital
assets, which represents an $86.0
million increase from December 31,
2022. Non-BaaS digital asset deposits totaled $25.3 million as of June
30, 2023, which represents a $32.2
million decrease from December 31,
2022. The increase in deposits was partially offset by a
decrease in borrowings of $47.1
million, or 37.1%, primarily driven by a decrease in
overnight borrowings.
As of June 30, 2023, shareholders'
equity was $215.1 million compared to
$207.5 million at December 31, 2022, which represents an increase
of $7.5 million, or 3.6%. The
increase was primarily due to net income of $5.6 million. Also contributing to the increase
was a one-time, cumulative-effect adjustment for the adoption of
CECL which increased retained earnings by $696,000. Shareholders' equity also increased due
to stock-based compensation expense of $651,000, employee stock ownership plan shares
earned of $356,000, and other
comprehensive income of $309,000.
About Provident Bancorp, Inc.
BankProv, a subsidiary of Provident Bancorp, Inc. (NASDAQ:
PVBC), is a future-ready commercial bank for corporate clients,
specializing in offering adaptive and technology-first banking
solutions to niche markets. We are committed to offering
state-of-the-art APIs (application programming interfaces) for all
business clients and BaaS partners. Through our offerings, BankProv
insures 100% of deposits through a combination of insurance
provided by the Federal Deposit Insurance Corporation (FDIC) and
the Depositors Insurance Fund (DIF). For more information
about BankProv please visit our website www.bankprov.com or
call 877-487-2977.
Forward-looking statements
This news release may contain certain forward-looking
statements, such as statements of the Company's or the Bank's
plans, objectives, expectations, estimates and intentions.
Forward-looking statements may be identified by the use of words
such as, "expects," "subject," "believe," "will," "intends," "may,"
"will be" or "would." These statements are subject to change based
on various important factors (some of which are beyond the
Company's or the Bank's control) and actual results may differ
materially. Accordingly, readers should not place undue reliance on
any forward-looking statements (which reflect management's analysis
of factors only as of the date of which they are given). These
factors include: general economic conditions; the impact of the
COVID-19 pandemic or any other pandemic on our operations and
financial results and those of our customers; global and national
war and terrorism; trends in interest rates; inflation; potential
recessionary conditions; levels of unemployment; legislative,
regulatory and accounting changes; monetary and fiscal policies of
the U.S. Government, including policies of the U.S. Treasury and
the Board of Governors of the Federal Reserve Bank; deposit flows;
our ability to access cost-effective funding; changes in liquidity,
including the size and composition of our deposit portfolio and the
percentage of uninsured deposits in the portfolio; changes in
consumer spending, borrowing and savings habits; competition; real
estate values in the market area; loan demand; the adequacy of our
allowance for loan losses, changes in the quality of our loan and
securities portfolios; the ability of our borrowers to repay their
loans; an unexpected adverse financial, regulatory or bankruptcy
event experienced by our cryptocurrency, digital asset
or financial technology ("fintech") customers; our ability to
retain key employees; failures or breaches of our IT systems,
including cyberattacks; the failure to maintain current
technologies; and the ability of the Company or the Bank to
effectively manage its growth and results of regulatory
examinations, among other factors. The foregoing list of important
factors is not exclusive. Readers should carefully review the risk
factors described in other documents of the Company files from time
to time with the Securities and Exchange Commission, including
Annual and Quarterly Reports on Forms 10-K and 10-Q, and Current
Reports on Form 8-K.
Provident Bancorp, Inc.
Carol Houle, 617-546-7365
Co-President and Co-Chief Executive Officer,
and Chief Financial Officer
choule@bankprov.com
Provident Bancorp,
Inc.
Consolidated Balance
Sheet
|
|
|
|
|
|
|
|
|
|
|
At
|
|
At
|
|
At
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
2023
|
|
2023
|
|
2022
|
(Dollars in
thousands)
|
(unaudited)
|
|
(unaudited)
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
Cash and due from
banks
|
$
|
32,254
|
|
$
|
27,669
|
|
$
|
42,923
|
Short-term
investments
|
|
265,604
|
|
|
216,509
|
|
|
37,706
|
Cash and cash
equivalents
|
|
297,858
|
|
|
244,178
|
|
|
80,629
|
Debt securities
available-for-sale (at fair value)
|
|
27,656
|
|
|
28,744
|
|
|
28,600
|
Federal Home Loan Bank
stock, at cost
|
|
3,309
|
|
|
3,095
|
|
|
4,266
|
Loans, net of allowance
for credit losses of $23,981, $24,812, and $28,069 as of
|
|
|
|
|
|
|
|
|
June 30, 2023, March
31, 2023, and December 31, 2022, respectively
|
|
1,333,564
|
|
|
1,323,390
|
|
|
1,416,047
|
Bank owned life
insurance
|
|
44,153
|
|
|
43,881
|
|
|
43,615
|
Premises and equipment,
net
|
|
13,400
|
|
|
13,439
|
|
|
13,580
|
Other repossessed
assets
|
|
—
|
|
|
—
|
|
|
6,051
|
Accrued interest
receivable
|
|
5,007
|
|
|
5,836
|
|
|
6,597
|
Right-of-use
assets
|
|
3,861
|
|
|
3,902
|
|
|
3,942
|
Deferred tax asset,
net
|
|
15,722
|
|
|
15,692
|
|
|
16,793
|
Other assets
|
|
17,057
|
|
|
19,996
|
|
|
16,261
|
Total
assets
|
$
|
1,761,587
|
|
$
|
1,702,153
|
|
$
|
1,636,381
|
|
|
|
|
|
|
|
|
|
Liabilities and
Shareholders' Equity
|
|
|
|
|
|
|
|
|
Deposits:
|
|
|
|
|
|
|
|
|
Noninterest-bearing
|
$
|
404,012
|
|
$
|
460,836
|
|
$
|
520,226
|
Interest-bearing
|
|
1,044,074
|
|
|
943,085
|
|
|
759,356
|
Total
deposits
|
|
1,448,086
|
|
|
1,403,921
|
|
|
1,279,582
|
Borrowings:
|
|
|
|
|
|
|
|
|
Short-term
borrowings
|
|
70,000
|
|
|
50,000
|
|
|
108,500
|
Long-term
borrowings
|
|
9,763
|
|
|
18,296
|
|
|
18,329
|
Total
borrowings
|
|
79,763
|
|
|
68,296
|
|
|
126,829
|
Operating lease
liabilities
|
|
4,227
|
|
|
4,255
|
|
|
4,282
|
Other
liabilities
|
|
14,439
|
|
|
14,229
|
|
|
18,146
|
Total
liabilities
|
|
1,546,515
|
|
|
1,490,701
|
|
|
1,428,839
|
Shareholders'
equity:
|
|
|
|
|
|
|
|
|
Preferred stock;
authorized 50,000 shares:
|
|
|
|
|
|
|
|
|
no shares issued and
outstanding
|
|
—
|
|
|
—
|
|
|
—
|
Common stock, $0.01 par
value, 100,000,000 shares authorized;
|
|
|
|
|
|
|
|
|
17,684,720,
17,693,818, and 17,669,698 shares issued and outstanding
|
|
|
|
|
|
|
|
|
at June 30, 2023,
March 31, 2023 and December 31, 2022, respectively
|
|
177
|
|
|
177
|
|
|
177
|
Additional paid-in
capital
|
|
123,444
|
|
|
123,144
|
|
|
122,847
|
Retained
earnings
|
|
100,894
|
|
|
97,432
|
|
|
94,630
|
Accumulated other
comprehensive loss
|
|
(1,891)
|
|
|
(1,569)
|
|
|
(2,200)
|
Unearned compensation -
ESOP
|
|
(7,552)
|
|
|
(7,732)
|
|
|
(7,912)
|
Total shareholders'
equity
|
|
215,072
|
|
|
211,452
|
|
|
207,542
|
Total liabilities
and shareholders' equity
|
$
|
1,761,587
|
|
$
|
1,702,153
|
|
$
|
1,636,381
|
Provident Bancorp,
Inc.
Consolidated Income
Statements
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June 30,
|
|
March 31,
|
|
June 30,
|
|
June 30,
|
|
June 30,
|
(Dollars in
thousands, except per share data)
|
2023
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Interest and
dividend income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and fees on
loans
|
$
|
19,652
|
|
$
|
20,006
|
|
$
|
18,558
|
|
$
|
39,658
|
|
$
|
36,770
|
Interest and dividends
on debt securities
available-for-sale
|
|
246
|
|
|
238
|
|
|
194
|
|
|
484
|
|
|
373
|
Interest on short-term
investments
|
|
2,978
|
|
|
383
|
|
|
400
|
|
|
3,361
|
|
|
459
|
Total interest and
dividend income
|
|
22,876
|
|
|
20,627
|
|
|
19,152
|
|
|
43,503
|
|
|
37,602
|
Interest
expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest on
deposits
|
|
7,670
|
|
|
3,901
|
|
|
476
|
|
|
11,571
|
|
|
931
|
Interest on short-term
borrowings
|
|
230
|
|
|
824
|
|
|
—
|
|
|
1,054
|
|
|
—
|
Interest on long-term
borrowings
|
|
74
|
|
|
86
|
|
|
71
|
|
|
160
|
|
|
141
|
Total interest
expense
|
|
7,974
|
|
|
4,811
|
|
|
547
|
|
|
12,785
|
|
|
1,072
|
Net interest and
dividend income
|
|
14,902
|
|
|
15,816
|
|
|
18,605
|
|
|
30,718
|
|
|
36,530
|
Credit loss (benefit)
expense - loans
|
|
(740)
|
|
|
2,935
|
|
|
1,005
|
|
|
2,195
|
|
|
1,088
|
Credit loss (benefit)
expense - off-balance
sheet credit exposures
|
|
(327)
|
|
|
(1,156)
|
|
|
36
|
|
|
(1,483)
|
|
|
36
|
Total credit loss
(benefit) expense
|
|
(1,067)
|
|
|
1,779
|
|
|
1,041
|
|
|
712
|
|
|
1,124
|
Net interest and
dividend income after
credit loss (benefit) expense
|
|
15,969
|
|
|
14,037
|
|
|
17,564
|
|
|
30,006
|
|
|
35,406
|
Noninterest
income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Customer service fees
on deposit accounts
|
|
769
|
|
|
979
|
|
|
619
|
|
|
1,748
|
|
|
1,200
|
Service charges and
fees - other
|
|
527
|
|
|
451
|
|
|
452
|
|
|
978
|
|
|
828
|
Bank owned life
insurance income
|
|
272
|
|
|
266
|
|
|
258
|
|
|
538
|
|
|
514
|
Gain on loans sold,
net
|
|
—
|
|
|
—
|
|
|
187
|
|
|
—
|
|
|
284
|
Other income
|
|
134
|
|
|
251
|
|
|
36
|
|
|
385
|
|
|
46
|
Total
noninterest income
|
|
1,702
|
|
|
1,947
|
|
|
1,552
|
|
|
3,649
|
|
|
2,872
|
Noninterest
expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and employee
benefits
|
|
8,109
|
|
|
8,544
|
|
|
7,322
|
|
|
16,653
|
|
|
14,511
|
Occupancy
expense
|
|
421
|
|
|
421
|
|
|
398
|
|
|
842
|
|
|
837
|
Equipment
expense
|
|
151
|
|
|
144
|
|
|
143
|
|
|
295
|
|
|
281
|
Deposit
insurance
|
|
368
|
|
|
278
|
|
|
154
|
|
|
646
|
|
|
305
|
Data
processing
|
|
374
|
|
|
361
|
|
|
344
|
|
|
735
|
|
|
679
|
Marketing
expense
|
|
161
|
|
|
83
|
|
|
70
|
|
|
244
|
|
|
197
|
Professional
fees
|
|
919
|
|
|
1,403
|
|
|
709
|
|
|
2,322
|
|
|
1,437
|
Directors'
compensation
|
|
164
|
|
|
200
|
|
|
267
|
|
|
364
|
|
|
521
|
Software depreciation
and implementation
|
|
483
|
|
|
417
|
|
|
327
|
|
|
900
|
|
|
621
|
Insurance
expense
|
|
450
|
|
|
452
|
|
|
448
|
|
|
902
|
|
|
895
|
Service fees
|
|
281
|
|
|
236
|
|
|
225
|
|
|
517
|
|
|
433
|
Write down of other
assets and receivables
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
395
|
Other
|
|
870
|
|
|
672
|
|
|
900
|
|
|
1,542
|
|
|
1,606
|
Total noninterest
expense
|
|
12,751
|
|
|
13,211
|
|
|
11,307
|
|
|
25,962
|
|
|
22,718
|
Income before income
tax expense
|
|
4,920
|
|
|
2,773
|
|
|
7,809
|
|
|
7,693
|
|
|
15,560
|
Income tax
expense
|
|
1,459
|
|
|
670
|
|
|
2,190
|
|
|
2,129
|
|
|
4,416
|
Net
income
|
$
|
3,461
|
|
$
|
2,103
|
|
$
|
5,619
|
|
$
|
5,564
|
|
$
|
11,144
|
Earnings per
share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
|
0.21
|
|
$
|
0.13
|
|
$
|
0.34
|
|
$
|
0.34
|
|
$
|
0.68
|
Diluted
|
|
0.21
|
|
$
|
0.13
|
|
$
|
0.33
|
|
$
|
0.34
|
|
$
|
0.66
|
Weighted Average
Shares:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
16,568,664
|
|
|
16,530,627
|
|
|
16,460,248
|
|
|
16,549,751
|
|
|
16,488,941
|
Diluted
|
|
16,570,017
|
|
|
16,531,266
|
|
|
16,882,933
|
|
|
16,550,666
|
|
|
16,957,186
|
Provident Bancorp,
Inc.
Net Interest Income
Analysis
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months
Ended
|
|
June 30,
|
|
March 31,
|
|
|
June 30,
|
|
2023
|
|
2023
|
|
|
2022
|
|
|
|
|
Interest
|
|
|
|
|
|
|
Interest
|
|
|
|
|
|
|
|
Interest
|
|
|
|
Average
|
|
Earned/
|
|
Yield/
|
|
Average
|
|
Earned/
|
|
Yield/
|
|
|
Average
|
|
Earned/
|
|
Yield/
|
(Dollars in
thousands)
|
Balance
|
|
Paid
|
|
Rate (6)
|
|
Balance
|
|
Paid
|
|
Rate (6)
|
|
|
Balance
|
|
Paid
|
|
Rate (6)
|
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-earning
assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans (1)(2)
|
$
|
1,346,654
|
|
$
|
19,652
|
|
5.84 %
|
|
$
|
1,391,941
|
|
$
|
20,006
|
|
5.75 %
|
|
|
$
|
1,465,000
|
|
$
|
18,558
|
|
5.07 %
|
Short-term
investments
|
|
236,367
|
|
|
2,978
|
|
5.04 %
|
|
|
40,931
|
|
|
383
|
|
3.74 %
|
|
|
|
219,555
|
|
|
400
|
|
0.73 %
|
Debt securities
available-
for-sale
|
|
28,278
|
|
|
197
|
|
2.79 %
|
|
|
28,727
|
|
|
193
|
|
2.69 %
|
|
|
|
32,687
|
|
|
190
|
|
2.33 %
|
Federal Home Loan
Bank
stock
|
|
2,254
|
|
|
49
|
|
8.70 %
|
|
|
2,639
|
|
|
45
|
|
6.82 %
|
|
|
|
1,388
|
|
|
4
|
|
1.15 %
|
Total
interest-earning
assets
|
|
1,613,553
|
|
|
22,876
|
|
5.67 %
|
|
|
1,464,238
|
|
|
20,627
|
|
5.63 %
|
|
|
|
1,718,630
|
|
|
19,152
|
|
4.46 %
|
Non-interest earning
assets
|
|
99,685
|
|
|
|
|
|
|
|
117,178
|
|
|
|
|
|
|
|
|
88,932
|
|
|
|
|
|
Total
assets
|
$
|
1,713,238
|
|
|
|
|
|
|
$
|
1,581,416
|
|
|
|
|
|
|
|
$
|
1,807,562
|
|
|
|
|
|
Liabilities and
shareholders' equity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings
accounts
|
$
|
149,625
|
|
$
|
408
|
|
1.09 %
|
|
$
|
142,457
|
|
$
|
111
|
|
0.31 %
|
|
|
$
|
152,932
|
|
$
|
51
|
|
0.13 %
|
Money market
accounts
|
|
513,348
|
|
|
4,550
|
|
3.55 %
|
|
|
313,077
|
|
|
1,913
|
|
2.44 %
|
|
|
|
331,998
|
|
|
211
|
|
0.25 %
|
NOW accounts
|
|
115,869
|
|
|
202
|
|
0.70 %
|
|
|
127,124
|
|
|
146
|
|
0.46 %
|
|
|
|
264,038
|
|
|
135
|
|
0.20 %
|
Certificates of
deposit
|
|
230,023
|
|
|
2,510
|
|
4.36 %
|
|
|
185,470
|
|
|
1,731
|
|
3.73 %
|
|
|
|
58,781
|
|
|
79
|
|
0.54 %
|
Total
interest-bearing
deposits
|
|
1,008,865
|
|
|
7,670
|
|
3.04 %
|
|
|
768,128
|
|
|
3,901
|
|
2.03 %
|
|
|
|
807,749
|
|
|
476
|
|
0.24 %
|
Borrowings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Short-term
borrowings
|
|
18,352
|
|
|
230
|
|
5.01 %
|
|
|
69,647
|
|
|
824
|
|
4.73 %
|
|
|
|
857
|
|
|
—
|
|
— %
|
Long-term
borrowings
|
|
16,148
|
|
|
74
|
|
1.83 %
|
|
|
18,307
|
|
|
86
|
|
1.88 %
|
|
|
|
13,500
|
|
|
71
|
|
2.10 %
|
Total
borrowings
|
|
34,500
|
|
|
304
|
|
3.52 %
|
|
|
87,954
|
|
|
910
|
|
4.14 %
|
|
|
|
14,357
|
|
|
71
|
|
1.98 %
|
Total
interest-bearing
liabilities
|
|
1,043,365
|
|
|
7,974
|
|
3.06 %
|
|
|
856,082
|
|
|
4,811
|
|
2.25 %
|
|
|
|
822,106
|
|
|
547
|
|
0.27 %
|
Noninterest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest-bearing
deposits
|
|
437,167
|
|
|
|
|
|
|
|
495,067
|
|
|
|
|
|
|
|
|
726,623
|
|
|
|
|
|
Other
noninterest-bearing
liabilities
|
|
19,380
|
|
|
|
|
|
|
|
20,469
|
|
|
|
|
|
|
|
|
19,568
|
|
|
|
|
|
Total
liabilities
|
|
1,499,912
|
|
|
|
|
|
|
|
1,371,618
|
|
|
|
|
|
|
|
|
1,568,297
|
|
|
|
|
|
Total equity
|
|
213,326
|
|
|
|
|
|
|
|
209,798
|
|
|
|
|
|
|
|
|
239,265
|
|
|
|
|
|
Total liabilities
and
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
equity
|
$
|
1,713,238
|
|
|
|
|
|
|
$
|
1,581,416
|
|
|
|
|
|
|
|
$
|
1,807,562
|
|
|
|
|
|
Net interest
income
|
|
|
|
$
|
14,902
|
|
|
|
|
|
|
$
|
15,816
|
|
|
|
|
|
|
|
$
|
18,605
|
|
|
Interest rate spread
(3)
|
|
|
|
|
|
|
2.61 %
|
|
|
|
|
|
|
|
3.38 %
|
|
|
|
|
|
|
|
|
4.19 %
|
Net interest-earning
assets (4)
|
$
|
570,188
|
|
|
|
|
|
|
$
|
608,156
|
|
|
|
|
|
|
|
$
|
896,524
|
|
|
|
|
|
Net interest margin
(5)
|
|
|
|
|
|
|
3.69 %
|
|
|
|
|
|
|
|
4.32 %
|
|
|
|
|
|
|
|
|
4.33 %
|
Average
interest-earning assets
to interest-bearing liabilities
|
|
154.65 %
|
|
|
|
|
|
|
|
171.04 %
|
|
|
|
|
|
|
|
|
209.05 %
|
|
|
|
|
|
|
|
(1)
|
Interest earned/paid on
loans includes mortgage warehouse loan origination fee income of
$213,000, $262,000, and $239,000 for the three months ended June
30, 2023, March 31, 2023, and June 30, 2022,
respectively.
|
(2)
|
Includes loans held for
sale.
|
(3)
|
Net interest rate
spread represents the difference between the weighted average yield
on interest-bearing assets and the weighted average rate of
interest-bearing liabilities.
|
(4)
|
Net interest-earning
assets represent total interest-earning assets less total
interest-bearing liabilities.
|
(5)
|
Net interest margin
represents net interest income divided by average total
interest-earning assets.
|
(6)
|
Annualized.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Six Months
Ended June 30,
|
|
|
2023
|
|
|
2022
|
|
|
|
|
|
Interest
|
|
|
|
|
|
|
|
Interest
|
|
|
|
|
Average
|
|
|
Earned/
|
|
Yield/
|
|
|
Average
|
|
|
Earned/
|
|
Yield/
|
(Dollars in
thousands)
|
|
Balance
|
|
|
Paid
|
|
Rate (6)
|
|
|
Balance
|
|
|
Paid
|
|
Rate (6)
|
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-earning
assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans (1)(2)
|
$
|
1,369,172
|
|
$
|
39,658
|
|
5.79 %
|
|
$
|
1,467,122
|
|
$
|
36,770
|
|
5.01 %
|
Short-term
investments
|
|
139,189
|
|
|
3,361
|
|
4.83 %
|
|
|
178,483
|
|
|
459
|
|
0.51 %
|
Debt securities
available-for-sale
|
|
28,501
|
|
|
389
|
|
2.73 %
|
|
|
34,245
|
|
|
365
|
|
2.13 %
|
Federal Home Loan Bank
stock
|
|
2,445
|
|
|
95
|
|
7.77 %
|
|
|
1,088
|
|
|
8
|
|
1.47 %
|
Total interest-earning assets
|
|
1,539,307
|
|
|
43,503
|
|
5.65 %
|
|
|
1,680,938
|
|
|
37,602
|
|
4.47 %
|
Non-interest earning
assets
|
|
108,385
|
|
|
|
|
|
|
|
87,247
|
|
|
|
|
|
Total assets
|
$
|
1,647,692
|
|
|
|
|
|
|
$
|
1,768,185
|
|
|
|
|
|
Liabilities and
shareholders' equity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings
accounts
|
$
|
146,061
|
|
$
|
519
|
|
0.71 %
|
|
$
|
153,205
|
|
$
|
91
|
|
0.12 %
|
Money market
accounts
|
|
413,765
|
|
|
6,463
|
|
3.12 %
|
|
|
362,268
|
|
|
460
|
|
0.25 %
|
NOW accounts
|
|
121,466
|
|
|
348
|
|
0.57 %
|
|
|
228,498
|
|
|
218
|
|
0.19 %
|
Certificates of
deposit
|
|
207,870
|
|
|
4,241
|
|
4.08 %
|
|
|
59,699
|
|
|
162
|
|
0.54 %
|
Total interest-bearing
deposits
|
|
889,162
|
|
|
11,571
|
|
2.60 %
|
|
|
803,670
|
|
|
931
|
|
0.23 %
|
Borrowings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Short-term
borrowings
|
|
43,857
|
|
|
1,054
|
|
4.81 %
|
|
|
431
|
|
|
—
|
|
— %
|
Long-term
borrowings
|
|
17,222
|
|
|
160
|
|
1.86 %
|
|
|
13,500
|
|
|
141
|
|
2.09 %
|
Total
borrowings
|
|
61,079
|
|
|
1,214
|
|
3.98 %
|
|
|
13,931
|
|
|
141
|
|
2.02 %
|
Total interest-bearing
liabilities
|
|
950,241
|
|
|
12,785
|
|
2.69 %
|
|
|
817,601
|
|
|
1,072
|
|
0.26 %
|
Noninterest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest-bearing
deposits
|
|
465,958
|
|
|
|
|
|
|
|
692,394
|
|
|
|
|
|
Other
noninterest-bearing liabilities
|
|
19,921
|
|
|
|
|
|
|
|
20,312
|
|
|
|
|
|
Total
liabilities
|
|
1,436,120
|
|
|
|
|
|
|
|
1,530,307
|
|
|
|
|
|
Total equity
|
|
211,572
|
|
|
|
|
|
|
|
237,878
|
|
|
|
|
|
Total liabilities
and
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
equity
|
$
|
1,647,692
|
|
|
|
|
|
|
$
|
1,768,185
|
|
|
|
|
|
Net interest
income
|
|
|
|
$
|
30,718
|
|
|
|
|
|
|
$
|
36,530
|
|
|
Interest rate spread
(3)
|
|
|
|
|
|
|
2.96 %
|
|
|
|
|
|
|
|
4.21 %
|
Net interest-earning
assets (4)
|
$
|
589,066
|
|
|
|
|
|
|
$
|
863,337
|
|
|
|
|
|
Net interest margin
(5)
|
|
|
|
|
|
|
3.99 %
|
|
|
|
|
|
|
|
4.35 %
|
Average
interest-earning assets to
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
interest-bearing liabilities
|
|
161.99 %
|
|
|
|
|
|
|
|
205.59 %
|
|
|
|
|
|
|
|
(1)
|
Interest earned/paid on
loans includes mortgage warehouse loan origination fee income of
$475,000 and $580,000 for the six months ended June 30, 2023 and
June 30, 2022, respectively.
|
(2)
|
Includes loans held for
sale.
|
(3)
|
Net interest rate
spread represents the difference between the weighted average yield
on interest-bearing assets and the weighted average rate of
interest-bearing liabilities.
|
(4)
|
Net interest-earning
assets represent total interest-earning assets less total
interest-bearing liabilities.
|
(5)
|
Net interest margin
represents net interest income divided by average total
interest-earning assets.
|
(6)
|
Annualized.
|
Provident Bancorp,
Inc.
Select Financial
Highlights
(Unaudited)
|
|
|
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
|
June 30,
|
|
March 31,
|
|
June 30,
|
|
June 30,
|
|
|
2023
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
Performance
Ratios:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average
assets (1)
|
|
0.81 %
|
|
|
0.53 %
|
|
|
1.24 %
|
|
|
0.68 %
|
|
|
1.26 %
|
|
Return on average
equity (1)
|
|
6.49 %
|
|
|
4.01 %
|
|
|
9.39 %
|
|
|
5.26 %
|
|
|
9.37 %
|
|
Interest rate spread
(1) (2)
|
|
2.61 %
|
|
|
3.39 %
|
|
|
4.19 %
|
|
|
2.96 %
|
|
|
4.21 %
|
|
Net interest margin (1)
(3)
|
|
3.69 %
|
|
|
4.32 %
|
|
|
4.33 %
|
|
|
3.99 %
|
|
|
4.35 %
|
|
Non-interest expense to
average assets (1)
|
|
2.98 %
|
|
|
3.34 %
|
|
|
2.51 %
|
|
|
3.15 %
|
|
|
2.57 %
|
|
Efficiency ratio
(4)
|
|
76.79 %
|
|
|
74.37 %
|
|
|
56.27 %
|
|
|
75.54 %
|
|
|
57.75 %
|
|
Average
interest-earning assets to
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
average
interest-bearing liabilities
|
|
154.65 %
|
|
|
171.04 %
|
|
|
209.05 %
|
|
|
161.99 %
|
|
|
205.59 %
|
|
Average equity to
average assets
|
|
12.45 %
|
|
|
13.27 %
|
|
|
13.24 %
|
|
|
12.84 %
|
|
|
13.45 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At
|
|
At
|
|
At
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
2023
|
|
2023
|
|
2022
|
Asset
Quality
|
|
|
|
|
|
|
|
|
Non-accrual
loans:
|
|
|
|
|
|
|
|
|
Commercial real
estate
|
$
|
160
|
|
$
|
55
|
|
$
|
56
|
Commercial
|
|
70
|
|
|
193
|
|
|
101
|
Enterprise
value
|
|
4,310
|
|
|
4,397
|
|
|
92
|
Digital
asset
|
|
16,768
|
|
|
26,602
|
|
|
26,488
|
Residential real
estate
|
|
361
|
|
|
224
|
|
|
227
|
Construction and land
development
|
|
—
|
|
|
—
|
|
|
—
|
Consumer
|
|
—
|
|
|
—
|
|
|
—
|
Mortgage
warehouse
|
|
—
|
|
|
—
|
|
|
—
|
Total non-accrual
loans
|
|
21,669
|
|
|
31,471
|
|
|
26,964
|
Accruing loans past due
90 days or more
|
|
—
|
|
|
—
|
|
|
—
|
Other repossessed
assets
|
|
—
|
|
|
—
|
|
|
6,051
|
Total non-performing
assets
|
$
|
21,669
|
|
$
|
31,471
|
|
$
|
33,015
|
Asset Quality
Ratios
|
|
|
|
|
|
|
|
|
Allowance for credit
losses as a percent of total loans (5)
|
|
1.77 %
|
|
|
1.84 %
|
|
|
1.94 %
|
Allowance for credit
losses as a percent of non-performing loans
|
|
110.67 %
|
|
|
78.84 %
|
|
|
104.10 %
|
Non-performing loans as
a percent of total loans (5)
|
|
1.60 %
|
|
|
2.33 %
|
|
|
1.87 %
|
Non-performing loans as
a percent of total assets
|
|
1.23 %
|
|
|
1.85 %
|
|
|
1.65 %
|
Non-performing assets
as a percent of total assets (6)
|
|
1.23 %
|
|
|
1.85 %
|
|
|
2.02 %
|
Capital and Share
Related
|
|
|
|
|
|
|
|
|
Stockholders' equity to
total assets
|
|
12.2 %
|
|
|
12.4 %
|
|
|
12.7 %
|
Book value per
share
|
$
|
12.16
|
|
$
|
11.95
|
|
$
|
11.75
|
Market value per
share
|
$
|
8.28
|
|
$
|
6.84
|
|
$
|
7.28
|
Shares
outstanding
|
|
17,684,720
|
|
|
17,693,818
|
|
|
17,669,698
|
|
|
(1)
|
Annualized where
appropriate.
|
(2)
|
Represents the
difference between the weighted average yield on average
interest-earning assets and the weighted average cost of
interest-bearing liabilities.
|
(3)
|
Represents net interest
income as a percent of average interest-earning assets.
|
(4)
|
Represents noninterest expense divided by the
sum of net interest income and noninterest income, excluding gains
on securities available for sale, net.
|
(5)
|
Loans are presented at
amortized cost (excluding accrued interest).
|
(6)
|
Non-performing assets
consists of non-accrual loans plus loans accruing but 90 days
overdue and other repossessed assets.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At
|
|
At
|
|
At
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
2023
|
|
2023
|
|
2022
|
(In
thousands)
|
Amount
|
|
Percent
|
|
Amount
|
|
Percent
|
|
Amount
|
|
Percent
|
Commercial real
estate
|
$
|
438,029
|
|
32.26 %
|
|
$
|
447,461
|
|
33.19 %
|
|
$
|
453,592
|
|
31.41 %
|
Commercial
|
|
187,965
|
|
13.85 %
|
|
|
194,335
|
|
14.41 %
|
|
|
216,931
|
|
15.02 %
|
Enterprise
value
|
|
436,574
|
|
32.15 %
|
|
|
437,570
|
|
32.46 %
|
|
|
438,745
|
|
30.38 %
|
Digital asset
(1)
|
|
16,768
|
|
1.24 %
|
|
|
26,981
|
|
2.00 %
|
|
|
40,781
|
|
2.82 %
|
Residential real
estate
|
|
7,490
|
|
0.55 %
|
|
|
7,661
|
|
0.57 %
|
|
|
8,165
|
|
0.57 %
|
Construction and land
development
|
|
96,757
|
|
7.13 %
|
|
|
84,800
|
|
6.29 %
|
|
|
72,267
|
|
5.00 %
|
Consumer
|
|
207
|
|
0.02 %
|
|
|
281
|
|
0.02 %
|
|
|
391
|
|
0.03 %
|
Mortgage
warehouse
|
|
173,755
|
|
12.80 %
|
|
|
149,113
|
|
11.06 %
|
|
|
213,244
|
|
14.77 %
|
|
|
1,357,545
|
|
100.00 %
|
|
|
1,348,202
|
|
100.00 %
|
|
|
1,444,116
|
|
100.00 %
|
Allowance for credit
losses - loans
|
|
(23,981)
|
|
|
|
|
(24,812)
|
|
|
|
|
(28,069)
|
|
|
Net loans
|
$
|
1,333,564
|
|
|
|
$
|
1,323,390
|
|
|
|
$
|
1,416,047
|
|
|
|
|
(1)
|
Includes $16.8 million,
$20.9 million, and $26.5 million in loans secured
by cryptocurrency mining rigs at June 30, 2023, March 31,
2023, and December 31, 2022, respectively. The remaining balances
consist of digital asset lines of credit.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At
|
|
At
|
|
At
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
(In
thousands)
|
2023
|
|
2023
|
|
2022
|
Noninterest-bearing:
|
|
|
|
|
|
|
|
|
Demand
|
$
|
404,012
|
|
$
|
460,836
|
|
$
|
520,226
|
Interest-bearing:
|
|
|
|
|
|
|
|
|
NOW
|
|
111,701
|
|
|
122,721
|
|
|
145,533
|
Regular
savings
|
|
159,940
|
|
|
158,470
|
|
|
141,802
|
Money market
deposits
|
|
530,964
|
|
|
451,427
|
|
|
318,417
|
Certificates of
deposit:
|
|
|
|
|
|
|
|
|
Certificate accounts
of $250,000 or more
|
|
20,869
|
|
|
17,659
|
|
|
11,449
|
Certificate accounts
less than $250,000
|
|
220,600
|
|
|
192,808
|
|
|
142,155
|
Total
interest-bearing
|
|
1,044,074
|
|
|
943,085
|
|
|
759,356
|
Total deposits
(1)(2)(3)
|
$
|
1,448,086
|
|
$
|
1,403,921
|
|
$
|
1,279,582
|
|
|
(1)
|
Includes $235.6
million, $161.7 million, $45.3 million in BaaS deposits at
June 30, 2023, March 31, 2023, and December 31, 2022,
respectively.
|
(2)
|
Includes $25.3 million,
$58.1 million, and $57.5 million in digital asset deposits at June
30, 2023, March 31, 2023, and December 31, 2022,
respectively.
|
(3)
|
Of total deposits
the FDIC insured approximately 53%, 56%, and 55% and the
remaining 47%, 44%, and 45% were insured through the DIF, as of
June 30, 2023, March 31, 2023, and December 31, 2022,
respectively.
|
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SOURCE Provident Bancorp, Inc.