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Princeton Bancorp Inc

Princeton Bancorp Announces Third Quarter 2024 Results

PRINCETON, N.J. , Oct. 29, 2024 /PRNewswire/ -- Princeton Bancorp, Inc. (the "Company") (NASDAQ - BPRN), the bank holding company for The Bank of Princeton (the "Bank"), today reported its unaudited financial condition and results of operations at and for the quarter and nine-months ended September 30, 2024.

The Bank's third quarter was highlighted by the closing of the Cornerstone Bank acquisition. This acquisition will be immediately accretive to earnings with an expected 2.5 year earn back of tangible book value dilution. While the costs related to this acquisition naturally impacted our reported numbers, the core earnings of the Bank remain consistently strong. Please refer to the reconciliation table below that compares Non-GAAP net income to GAAP net income.

President/CEO Edward Dietzler commented, "We are thrilled with the Cornerstone acquisition. This acquisition, along with our recent one of Noah Bank, continues our long-term strategy of becoming the community bank of choice up and down the I95 corridor. Core loans and deposits are both up while asset quality and our capital position remain strong. The Bank is well positioned to continue our strong growth path with our experienced management team. Special thanks to our operations and technology teams who handled this acquisition."

The Company reported a net loss of ($3.6) million, or ($0.55) per diluted common share, for the third quarter of 2024, compared to net income of $5.1 million, or $0.80 per diluted common share, for the second quarter of 2024, and net income of $7.6 million, or $1.19 per diluted common share, for the third quarter of 2023.   The decrease in net income for the third quarter of 2024 when compared to the second quarter of 2024 was due to an increase of $7.0 million in non-interest expense, and an increase in the provision for credit losses of $4.7 million. These increases were primarily the result of the Cornerstone acquisition which resulted in $6.7 million in merger related expenses and a $3.2 million provision for credit loss associated with the acquired non-purchase credit deteriorated loans. These expenses were partially offset by an increase in net interest income of $1.1 million. The $11.2 million decrease in net income for the third quarter of 2024 compared to the same period in 2023 was primarily due to the same acquisition-related items.

Review of Statements of Financial Condition

Total assets were $2.35 billion at September 30, 2024, an increase of $438.2 million, or 22.87% when compared to $1.92 billion at the end of 2023. The primary reason for the increase in total assets was the acquisition of Cornerstone Bank on August 23, 2024, which had approximately $314.5 million in assets at closing. When looking at specific components of the balance sheet, including acquired assets, the Company recorded an increase in net loans of $283.1 million related to the Cornerstone acquisition, an increase in investments of $97.5 million, an increase in cash and cash equivalents of approximately $30.5 million, and an increase in other assets of $22.2 million. The increase in the Company's net loans consisted of increases of $248.4 million in commercial real estate loans, $42.8 million in commercial and industrial loans, $32.3 million in residential mortgages, and $11.3 in home equity and consumer loans, all partially offset by a decrease of $51.9 million in construction loans.

Total deposits on September 30, 2024, increased $410.3 million, or 25.08%, when compared to December 31, 2023. The primary reasons for the increase in total deposits were the $282.8 million in deposits acquired from Cornerstone Bank and the $127.5 million increase from existing operations.  The increase in the Company's deposits consisted of increases in certificates of deposit of $149.0 million, money market deposits of $139.3 million, non-interest-bearing deposits of $53.6 million, interest-bearing demand deposits of $36.6 million and savings deposits of $31.8 million.

Total stockholders' equity at September 30, 2024, increased $22.1 million or 9.22% when compared to December 31, 2023. The increase was primarily due to the $21.2 million increase in paid-in capital associated with the issuance of common stock of $20.0 million related to the acquisition of Cornerstone and a decrease in accumulated other comprehensive income (loss) of $1.6 million. The ratio of equity to total assets at September 30, 2024 and at December 31, 2023 was 11.1% and 12.5%, respectively. The current period ratio decrease was primarily due to the Cornerstone Bank acquisition.

Asset Quality

At September 30, 2024, non-performing assets totaled $2.3 million, a decrease of $4.4 million when compared to the amount at December 31, 2023.

Review of Quarterly and Year-to-Date Financial Results

Net interest income was $17.1 million for the third quarter of 2024, compared to $16.0 million for the second quarter of 2024 and $16.7 million for the third quarter of 2023. The increase from the previous quarter was the result of an increase in interest income of $2.4 million, or 8.2%, partially offset by an increase in interest expense of $1.3 million, or 9.4%. The net interest margin for the third quarter of 2024 was 3.41%, a decrease by 3 basis points when compared to the second quarter of 2024. The increase in interest expense and the decrease in net interest margin were primarily associated with an increase in total interest-bearing deposits of $98.9 million and a six basis point increase in the rate on such deposits. This resulted in an increase in the Company's cost of funds of 3 basis points.  The increase in interest income for the third quarter was due to an increase in average interest-earning assets of $130.2 million, while the yield on interest-earning assets remained consistent with the second quarter of 2024.

For the nine-month period ended September 30, 2024, the Company recorded net income of $5.9 million, or $0.90 per diluted common share, compared to $20.5 million, or $3.21 per diluted common share, for the same period in 2023. This year-to-date decrease was primarily the result of a $9.7 bargain purchase gain in 2023 which included a tax benefit of $2.0 million from the Company's acquisition of Noah Bank in May of that year, and the purchase accounting recorded in 2024 related to the Cornerstone acquisition, which includes an increase of $2.2 million in the provision for credit losses when comparing both periods.

The Company recorded a provision for credit losses of $4.6 million during the third quarter of 2024, which consisted of $3.2 million related to the CECL impact for non-purchase credit deteriorated loans associated with loans acquired in the Cornerstone acquisition, and $1.5 million recorded to the allowance of credit losses resulting from changes in the Company's loan portfolio assumptions. The current quarters' provision recorded on the Company's statements of income was $4.7 million higher when compared to the provision for credit losses for the quarter ended June 30, 2024, and was $4.8 million higher than the provision for the same period in 2023, most of which can primarily be attributed to the acquisition of Cornerstone Bank.  For the quarter ended September 30, 2024, the Company recorded charge-offs of $279 thousand and recoveries of $171 thousand. The coverage ratio of the allowance for credit losses to period end loans was 1.27% at September 30, 2024 and 1.19% at December 31, 2023.

Total non-interest income of $2.1 million for the third quarter of 2024 decreased $31 thousand or 1.5% when compared to the second quarter of 2024 and decreased $347 thousand or 14.4% when compared to the quarter ended September 30, 2023.

Total non-interest expense of $19.0 million for the third quarter of 2024 increased $7.0 million, or 58.5%, when compared to the second quarter of 2024. Total non-interest expense for the third quarter of 2024 increased $8.9 million or 87.4% when compared to the third quarter of 2023.  This increase over both the prior quarter and the third quarter of 2023 was primarily due to the $6.7 million in merger costs associated with the Cornerstone acquisition. The remaining increase compared to the second quarter of 2024 was primarily related to occupancy and equipment expense increasing $237 thousand, salaries and benefits expense increasing $113 thousand, data processing and communications expense increasing $52 thousand, and professional fees increasing $52 thousand all partially offset by a decrease in other expenses of $251 thousand. For the nine-month period ended September 30, 2024, non-interest expense was $42.9 million, compared to $37.7 million for the same period in 2023.  The increase was primarily due to an increase in merger-related expenses of $1.1 million during 2024 as well as increases in salaries and employee benefits of $2.2 million over the same period in 2023 associated with merit increases as well as additional staff costs related to the Cornerstone and Noah acquisitions.

For the quarter ended September 30, 2024, the Company recorded an income tax benefit of ($865) thousand, resulting in an effective tax rate of (19.3%), compared to an income tax expense of $1.0 million resulting in an effective tax rate of 16.8% for the second quarter ended June 30, 2024, and compared to an income tax expense of $1.5 million resulting in an effective tax rate of 16.6% for the quarter ended September 30, 2023.

About Princeton Bancorp, Inc. and The Bank of Princeton

Princeton Bancorp, Inc. is the holding company for The Bank of Princeton, a community bank founded in 2007.  The Bank is a New Jersey state-chartered commercial bank with 28 branches in New Jersey, including three in Princeton and others in Bordentown, Browns Mills, Burlington, Chesterfield, Cherry Hill, Cream Ridge, Deptford, Fort Lee, Hamilton, Kingston, Lakewood, Lambertville, Lawrenceville, Medford, Monroe, Moorestown, New Brunswick, Palisades Park, Pennington, Piscataway, Princeton Junction, Quakerbridge, Sicklerville, Voorhees, and Woodbury.  There are also five branches in the Philadelphia, Pennsylvania area and two in the New York City metropolitan area. The Bank of Princeton is a member of the Federal Deposit Insurance Corporation. 

Forward-Looking Statements

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

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

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

Princeton Bancorp, Inc.


Consolidated Statements of Financial Condition


(Unaudited)


(Dollars in thousands, except per share data)












































September 30, 2024 vs



September 30, 2024 vs




September 30,


December 31,


September 30,


December 31, 2023



September 30, 2023




2024


2023


2023


$ Change


%  Change


$ Change


%  Change


















ASSETS







Cash and cash equivalents


$        181,058


$        150,557


$        206,931


$    30,501


20.26

%


$      (25,873)


(12.50)

%

Securities available-for-sale taxable


147,871


50,544


47,765


97,327


192.56



100,106


209.58


Securities available-for-sale tax-exempt


40,988


40,808


37,627


180


0.44



3,361


8.93


Securities held-to-maturity


163


193


195


(30)


(15.54)



(32)


(16.41)


Loans receivable, net of deferred loan fees


1,831,407


1,548,335


1,498,500


283,072


18.28



332,907


22.22


Allowance for credit losses


(23,200)


(18,492)


(17,992)


(4,708)


25.46



(5,208)


28.95


Goodwill


14,381


8,853


8,853


5,528


62.44



5,528


62.44


Core deposit intangible


3,860


1,422


1,546


2,438


171.45



2,314


149.68


Equity method investments 


10,042


8,296


2,672


1,746


21.05



7,370


275.82


Other assets


148,160


125,981


127,026


22,179


17.61



21,134


16.64


TOTAL ASSETS


$     2,354,730


$     1,916,497


$     1,913,123


$  438,233


22.87

%


$     441,607


23.08

%



































LIABILITIES

















Non-interest checking


$        302,846


$        249,282


$        264,197


$    53,564


21.49

%


$       38,649


14.63

%

Interest checking


284,504


247,939


239,902


36,565


14.75



44,602


18.59


Savings


178,299


146,484


147,113


31,815


21.72



31,186


21.20


Money market


493,353


354,005


349,505


139,348


39.36



143,848


41.16


Time deposits over $250,000 


213,310


150,113


144,158


63,197


42.10



69,152


47.97


Other time deposits


573,689


487,918


493,091


85,771


17.58



80,598


16.35


Total deposits


2,046,001


1,635,741


1,637,966


410,260


25.08



408,035


24.91


Borrowings


-


-


-


-


-



-


       N/A 


Other liabilities


46,378


40,545


42,949


5,833


14.39



3,429


7.98


    TOTAL LIABILITIES


2,092,379


1,676,286


1,680,915


416,093


24.82



411,464


24.48



















STOCKHOLDERS' EQUITY

















Paid-in capital 


119,514


98,291


97,779


21,223


21.59



21,735


22.23


Treasury stock 1


(842)


-


-


(842)


100.00



(842)


100.00


Retained earnings


149,565


149,414


146,022


151


0.10



3,543


2.43


Accumulated other comprehensive income (loss)


(5,886)


(7,494)


(11,593)


1,608


(21.46)



5,707


(49.23)


     TOTAL STOCKHOLDERS' EQUITY 


262,351


240,211


232,208

#

22,140


9.22



30,143


12.98



















TOTAL LIABILITIES 

















     AND STOCKHOLDERS' EQUITY


$     2,354,730


$     1,916,497


$     1,913,123


$  438,233


22.87

%


$     441,607


23.08

%


















Book value per common share


$           38.15


$           38.04


$           36.86


$        0.11


0.29

%


$          1.29


3.50

%

Tangible book value per common share 2


$           35.50


$           36.41


$           35.21


$      (0.91)


(2.50)

%


$          0.29


0.82

%


















1 Treasury stock repurchases commenced March 8, 2024,  associated with the stock repurchase program announced August 10, 2023. 









2Tangible book value per common share is a non-GAAP measure. For more information, see "Supplemental Information - Non-GAAP Financial Measures (Unaudited)" below.




 

Princeton Bancorp, Inc.


Loan and Deposit Tables


(Unaudited)









The components of loans receivable, net at September 30, 2024 and December 31, 2023 were as follows:










September 30,


December 31,





2024


2023





(In thousands)



Commercial real estate


$      1,391,245


$      1,142,864



Commercial and industrial


93,782


50,961



Construction


258,332


310,187



Residential first-lien mortgages


70,389


38,040



Home equity / consumer


19,406


8,081



     Total loans


1,833,154


1,550,133



Deferred fees and costs 


(1,747)


(1,798)



Allowance for credit losses


(23,200)


(18,492)



     Loans, net


$      1,808,207


$      1,529,843

















The components of deposits at September 30, 2024 and December 31, 2023 were as follows:











September 30,


December 31,





2024


2023





(In thousands)



Demand, non-interest-bearing


$        302,846


$        249,282



Demand, interest-bearing 


284,504


247,939



Savings


178,299


146,484



Money market


493,353


354,005



Time deposits


786,999


638,031



     Total deposits


$      2,046,001


$      1,635,741



 

Princeton Bancorp, Inc.

Consolidated Statements of Income

(Unaudited)

(Amounts in thousands except per share data)














Three Months Ended September 30,








2024


2023


$ Change


% Change

Interest and dividend income









Loans and fees

$              28,135


$              23,503


$    4,632


19.7 %


Available-for-sale debt securities:










Taxable

1,273


357


916


256.6 %



Tax-exempt

285


285


0


0.0 %


Held-to-maturity debt securities

2


3


(1)


-33.3 %


Other interest and dividend income

2,115


2,852


(737)


-25.8 %



Total interest and dividends

31,810


27,000


4,810


17.8 %











Interest expense










Deposits

14,701


10,316


4,385


42.5 %



Borrowings

-


-


0


       N/A



Total interest expense

14,701


10,316


4,385


42.5 %











Net interest income

17,109


16,684


425


2.5 %

Provision for (reversal of) credit losses

4,601


(182)


4,783


-2628.0 %

Net interest income after provision for (reversal of) credit losses

12,508


16,866


(4,358)


-25.8 %











Non-interest income









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

(7)


(6)


(1)


16.7 %


Income from bank-owned life insurance

423


331


92


27.8 %


Fees and service charges

521


479


42


8.8 %


Loan fees, including prepayment penalties

784


1,184


(400)


-33.8 %


Gain on sale of other real estate owned

-


203


(203)


-100.0 %


Other 

335


212


123


58.0 %



Total non-interest income

2,056


2,403


(347)


-14.4 %











Non-interest expense









Salaries and employee benefits

6,556


6,177


379


6.1 %


Occupancy and equipment

2,087


2,142


(55)


-2.6 %


Professional fees

654


614


40


6.5 %


Data processing and communications

1,456


1,242


214


17.2 %


Federal deposit insurance

316


258


58


22.5 %


Advertising and promotion

181


139


42


30.2 %


Office expense

190


117


73


62.4 %


Core deposit intangible

143


116


27


23.3 %


Merger-related expenses

6,695


(1,391)


8,086


581.3 %


Other 

758


745


13


1.7 %



Total non-interest expense

19,036


10,159


8,877


87.4 %











Income (loss) before income tax expense

(4,472)


9,110


(13,582)


-149.1 %

Income tax (benefit) expense

(865)


1,512


(2,377)


-157.2 %

Net (loss) income

$               (3,607)


$                7,598


(11,205)


-147.5 %











Net (loss) income per common share - basic

$                 (0.55)


$                  1.21


$     (1.76)


-145.5 %

Net (loss) income per common share - diluted

$                 (0.55)


$                  1.19


$     (1.74)


-146.2 %











Weighted average shares outstanding - basic

6,573


6,295


278


4.4 %

Weighted average shares outstanding - diluted

6,573


6,390


183


2.9 %

 

Princeton Bancorp, Inc.

Consolidated Statements of Income (Current Quarter vs Prior Quarter)

(Unaudited)

(Amounts in thousands, except per share data)














Three Months Ended








September 30,


June 30,








2024


2024


$ Change


% Change

Interest and dividend income









Loans and fees

$        28,135


$        26,034


$      2,101


8.1 %


Available-for-sale debt securities:










Taxable

1,273


1,001


272


27.2 %



Tax-exempt

285


286


(1)


-0.3 %


Held-to-maturity debt securities

2


3


(1)


-33.3 %


Other interest and dividend income

2,115


2,086


29


1.4 %



Total interest and dividends

31,810


29,410


2,400


8.2 %











Interest expense










Deposits

14,701


13,442


1,259


9.4 %



Borrowings

-


-


-


       N/A



Total interest expense

14,701


13,442


1,259


9.4 %











Net interest income

17,109


15,968


1,141


7.1 %

Provision for (reversal of) credit losses

4,601


(118)


4,719


-3999.2 %

Net interest income after provision for (reversal of) credit losses

12,508


16,086


(3,578)


-22.2 %











Non-interest income









Gain on call/sale of securities available-for-sale

(7)


-


(7)


       N/A


Income from bank-owned life insurance

423


388


35


9.0 %


Fees and service charges

521


465


56


12.0 %


Loan fees, including prepayment penalties

784


937


(153)


-16.3 %


Other 

335


297


38


12.8 %



Total non-interest income

2,056


2,087


(31)


-1.5 %











Non-interest expense









Salaries and employee benefits

6,556


6,443


113


1.8 %


Occupancy and equipment

2,087


1,850


237


12.8 %


Professional fees

654


602


52


8.6 %


Data processing and communications

1,456


1,404


52


3.7 %


Federal deposit insurance

316


279


37


13.3 %


Advertising and promotion

181


156


25


16.0 %


Office expense

190


155


35


22.6 %


Core deposit intangible

143


111


32


28.8 %


Merger-related expenses

6,695


-


6,695


       N/A


Other 

758


1,009


(251)


-24.9 %



Total non-interest expense

19,036


12,009


7,027


58.5 %











Income (loss) before income tax expense

(4,472)


6,164


(10,636)


-172.6 %

Income tax (benefit) expense

(865)


1,038


(1,903)


-183.3 %

Net (loss) income

$        (3,607)


$          5,126


$     (8,733)


-170.4 %











Net (loss) income per common share - basic

$          (0.55)


$           0.81


$      (1.36)


-167.9 %

Net (loss) income per common share - diluted

$          (0.55)


$           0.80


$      (1.35)


-168.8 %











Weighted average shares outstanding - basic

6,573


6,334


239


3.8 %

Weighted average shares outstanding - diluted

6,573


6,420


153


2.4 %

 

Princeton Bancorp, Inc.

Consolidated Statements of Income

(Unaudited)

(Amounts in thousands, except per share data)














Nine Months Ended








September 30,








2024


2023


$ Change


% Change

Interest and dividend income









Loans and fees

$ 79,109


$  64,914


$      14,195


21.9 %


Available-for-sale debt securities:










Taxable

2,838


927


1,911


206.1 %



Tax-exempt

857


853


4


0.5 %


Held-to-maturity debt securities

7


8


(1)


-12.5 %


Other interest and dividend income

6,475


3,924


2,551


65.0 %



Total interest and dividends

89,286


70,626


18,660


26.4 %











Interest expense










Deposits

40,761


21,502


19,259


89.6 %



Borrowings

-


118


(118)


-100.0 %



Total interest expense

40,761


21,620


19,141


88.5 %











Net interest income

48,525


49,006


(481)


-1.0 %

Provision for credit losses

4,669


2,546


2,123


83.4 %

Net interest income after provision for credit losses

43,856


46,460


(2,604)


-5.6 %











Non-Interest income









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

(7)


(6)


(1)


16.7 %


Income from bank-owned life insurance

1,192


916


276


30.1 %


Fees and service charges

1,418


1,391


27


1.9 %


Loan fees, including prepayment penalties

2,445


2,565


(120)


-4.7 %


Bargain purchase gain

-


9,696


(9,696)


-100.0 %


Gain on sale of other real estate owned

-


203


(203)


-100.0 %


Other 

1,080


577


503


87.2 %



Total non-interest income

6,128


15,342


(9,214)


-60.1 %











Non-interest expense









Salaries and employee benefits

19,519


17,352


2,167


12.5 %


Occupancy and equipment

5,966


5,188


778


15.0 %


Professional fees

1,780


1,635


145


8.9 %


Data processing and communications

4,020


3,860


160


4.1 %


Federal deposit insurance

868


701


167


23.8 %


Advertising and promotion

479


375


104


27.7 %


Office expense

464


392


72


18.4 %


Other real estate owned expense

-


1


(1)


-100.0 %


Core deposit intangible

374


378


(4)


-1.1 %


Merger-related expenses

6,695


5,635


1,060


18.8 %


Other 

2,716


2,228


488


21.9 %



Total non-interest expense

42,881


37,745


5,136


13.6 %











Income before income tax expense

7,103


24,057


(16,954)


-70.5 %

Income tax expense

1,239


3,574


(2,335)


-65.3 %

Net income

$   5,864


$  20,483


$    (14,619)


-71.4 %











Net income per common share - basic

$    0.91


$     3.26


$        (2.35)


-72.0 %

Net income per common share - diluted

$    0.90


$     3.21


$        (2.31)


-71.9 %











Weighted average shares outstanding - basic

6,412


6,275


137


2.2 %

Weighted average shares outstanding - diluted

6,496


6,380


116


1.8 %

 

Princeton Bancorp, Inc.

Consolidated Average Statement of Financial Condition

(Unaudited)

(Dollars in thousands)














For the Three Months Ended September 30,






2024


2023


Change in


Change in


Average 


Yield/


Average 


Yield/


Average 


Yield/


Balance


Rate 


Balance


Rate 


Balance


Rate 

Earning assets












Loans 

$     1,691,688


6.62 %


$    1,464,798


6.37 %


$       226,890


0.25 %

Securities












  Taxable available-for-sale

111,633


4.56 %


46,599


3.06 %


65,034


1.50 %

  Tax-exempt available-for-sale

40,028


2.85 %


40,118


2.84 %


(90)


0.01 %

  Held-to-maturity

164


5.33 %


196


5.28 %


(32)


0.05 %

Securities

151,825


4.11 %


86,913


2.96 %


64,912


1.15 %













Other interest earning assets












  Federal funds sold

135,164


5.38 %


199,350


5.38 %


(64,186)


0.00 %

  Other interest-earning assets

19,549


5.85 %


10,506


5.67 %


9,043


0.18 %

Other interest-earning assets

154,713


5.44 %


209,856


5.39 %


(55,143)


0.05 %

Total interest-earning assets

1,998,226


6.33 %


1,761,567


6.08 %


236,659


0.25 %

Total non-earning assets

151,776




127,682







Total assets

$     2,150,002




$    1,889,249































Interest-bearing liabilities












Checking

$        258,728


1.86 %


$       243,359


1.68 %


$         15,369


0.18 %

Savings

159,521


2.57 %


149,215


2.10 %


10,306


0.47 %

Money market

443,109


3.85 %


337,491


3.50 %


105,618


0.35 %

Certificates of deposit

721,240


4.50 %


629,082


3.48 %


92,158


1.02 %

    Total interest-bearing deposits

1,582,598


3.70 %


1,359,147


3.01 %


223,451


0.69 %

Non-interest bearing deposits

269,030




255,775




13,255



    Total  deposits

1,851,628


3.16 %


1,614,922


2.53 %


236,706


0.63 %

Borrowings

-


      N/A


-


      N/A


-


          N/A

    Total interest-bearing liabilities 












       (excluding non interest deposits)

1,582,598


3.70 %


1,359,147


3.01 %


223,451


0.69 %

Non-interest-bearing deposits

269,030




255,775







Total cost of funds

1,851,628


3.16 %


1,614,922


2.53 %


236,706


0.63 %

Accrued expenses and other liabilities

43,729




45,923







Stockholders' equity

254,645




228,404







Total liabilities and stockholders' equity

$     2,150,002




$    1,889,249



















Net interest spread



2.64 %




3.07 %





Net interest margin



3.41 %




3.76 %





Net interest margin (FTE) 1, 2



3.45 %




3.81 %

















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











  2This is a non-GAAP financial measure. For more information, see "Supplemental Information - Non-GAAP Financial Measures (Unaudited)" below.



 

Princeton Bancorp, Inc.

Consolidated Average Statement of Financial Condition

(Unaudited)

(Dollars in thousands)














For the Nine Months Ended September 30,






2024


2023


Change in


Change in


Average 


Yield/


Average 


Yield/


Average 


Yield/


Balance


Rate 


Balance


Rate 


Balance


Rate 

Earning assets












Loans 

$    1,609,890


6.56 %


$    1,424,768


6.09 %


$        185,122


0.47 %

Securities












  Taxable available-for-sale

86,732


4.36 %


44,517


2.78 %


42,215


1.58 %

  Tax-exempt available-for-sale

40,180


2.84 %


40,974


2.78 %


(794)


0.06 %

  Held-to-maturity

171


5.25 %


198


5.28 %


(27)


-0.03 %

Securities

127,083


3.88 %


85,689


2.78 %


41,394


1.10 %













Other interest earning assets












  Federal funds sold

138,843


5.43 %


91,761


5.30 %


47,082


0.13 %

  Other interest-earning assets

19,281


5.76 %


7,086


5.36 %


12,195


0.40 %

Other interest-earning assets

158,124


5.47 %


98,847


5.31 %


59,277


0.16 %

Total interest-earning assets

1,895,097


6.29 %


1,609,304


5.87 %


285,793


0.42 %

Total non-earning assets

144,630




114,543







Total assets

$    2,039,727




$    1,723,847































Interest-bearing liabilities












Checking

$       244,271


1.93 %


$       250,100


1.29 %


$          (5,829)


0.64 %

Savings

151,884


2.57 %


163,516


1.54 %


(11,632)


1.03 %

Money market

399,253


3.92 %


297,360


2.81 %


101,893


1.11 %

Certificates of deposit

704,388


4.28 %


504,237


2.90 %


200,151


1.38 %

    Total interest-bearing deposits

1,499,796


3.63 %


1,215,213


2.37 %


284,583


1.26 %

Non-interest bearing deposits

252,184




244,718







    Total  deposits

1,751,980


3.11 %


1,459,931


1.97 %


292,049


1.14 %













Borrowings

-


0.00 %


3,133


5.01 %


(3,133)


-5.01 %

    Total interest-bearing liabilities 












       (excluding non interest deposits)

1,499,796


3.63 %


1,218,346


2.37 %


281,450


1.26 %

Non-interest-bearing deposits

252,184




244,718







Total cost of funds

1,751,980


3.11 %


1,463,064


1.97 %


288,916


1.14 %

Accrued expenses and other liabilities

42,239




34,312







Stockholders' equity

245,508




226,471







Total liabilities and stockholders' equity

$    2,039,727




$    1,723,847



















Net interest spread



2.66 %




3.50 %





Net interest margin



3.42 %




4.07 %





Net interest margin (FTE) 1, 2



3.46 %




4.13 %

















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











   2This is a non-GAAP financial measure. For more information, see "Supplemental Information - Non-GAAP Financial Measures (Unaudited)" below.



 

Princeton Bancorp, Inc.

Consolidated Average Statement of Financial Condition

(Unaudited)

(Dollars in thousands)














For the Three Months Ended






September 30, 2024


June 30, 2024


Change in


Change in


Average 


Yield/


Average 


Yield/


Average 


Yield/


Balance


Rate 


Balance


Rate 


Balance


Rate 

Earning assets












Loans 

$    1,691,688


6.62 %


$       1,585,876


6.60 %


$      105,812


0.01 %

Securities












  Taxable available-for-sale

111,633


4.56 %


89,547


4.47 %


22,086


0.09 %

  Tax-exempt available-for-sale

40,028


2.85 %


39,756


2.88 %


272


-0.03 %

  Held-to-maturity

164


5.33 %


166


5.33 %


(2)


0.00 %

Securities

151,825


4.11 %


129,469


3.98 %


22,356


0.13 %













Other interest earning assets












  Federal funds sold

135,164


5.38 %


133,336


5.45 %


1,828


-0.07 %

  Other interest-earning assets

19,549


5.85 %


19,338


5.78 %


211


0.07 %

Other interest-earning assets

154,713


5.44 %


152,674


5.49 %


2,039


-0.05 %

Total interest-earning assets

1,998,226


6.33 %


1,868,019


6.33 %


130,207


0.00 %

Total non-earning assets

151,776




141,377







Total assets

$    2,150,002




$       2,009,396































Interest-bearing liabilities












Checking

$       258,728


1.86 %


$          231,895


1.94 %


$        26,833


-0.08 %

Savings

159,521


2.57 %


148,377


2.64 %


11,144


-0.07 %

Money market

443,109


3.85 %


390,019


3.99 %


53,090


-0.14 %

Certificates of deposit

721,240


4.50 %


713,433


4.22 %


7,807


0.29 %

    Total interest-bearing deposits

1,582,598


3.70 %


1,483,724


3.64 %


98,874


0.05 %

Non-interest bearing deposits

269,030




243,248




25,781



    Total  deposits

1,851,628


3.16 %


1,726,972


3.13 %


124,655


0.03 %

Borrowings

-


      N/A


-


      N/A


-


            N/A

    Total interest-bearing liabilities 












       (excluding non interest deposits)

1,582,598


3.70 %


1,483,724


3.64 %


98,874


0.05 %

Non-interest-bearing deposits

269,030




243,248







Total cost of funds

1,851,628


3.16 %


1,726,972


3.13 %


124,655


0.03 %

Accrued expenses and other liabilities

43,729




40,874







Stockholders' equity

254,645




241,550







Total liabilities and stockholders' equity

$    2,150,002




$       2,009,396



















Net interest spread



2.64 %




2.69 %





Net interest margin



3.41 %




3.44 %





Net interest margin (FTE) 1, 2



3.45 %




3.48 %

















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











  2This is a non-GAAP financial measure. For more information, see "Supplemental Information - Non-GAAP Financial Measures (Unaudited)" below.




 

Princeton Bancorp, Inc.

Quarterly Financial Highlights

(Unaudited)
















2024


2024


2024


2023


2023



September 


June 


March 


December


September













     Return on average assets 

-0.67 %


1.03 %


0.89 %


1.09 %


1.60 %


     Return on average equity 

-5.64 %


8.54 %


7.27 %


8.93 %


13.20 %


     Return on average tangible equity1

-6.07 %


8.91 %


7.60 %


9.34 %


13.83 %


     Net interest margin

3.41 %


3.44 %


3.42 %


3.55 %


3.76 %


     Net interest margin (FTE)1

3.45 %


3.48 %


3.58 %


3.51 %


3.81 %


     Adjusted efficiency ratio1 

63.65 %


65.90 %


67.21 %


60.85 %


59.89 %













COMMON STOCK DATA











     Market value at period end

$     36.98


$     33.10


$     30.78


$     35.90


$     28.99


     Market range:











        High

$     39.12


$     33.10


$     36.25


$     37.60


$     31.69


        Low

$     32.40


$     29.15


$     29.72


$     28.21


$     27.37


     Book value per common share at period end

$     38.15


$     38.54


$     38.26


$     38.04


$     36.86


     Tangible book value per common share1

$     35.50


$     36.98


$     36.65


$     36.41


$     35.21


     Shares of common stock outstanding (in thousands)

6,876


6,353


6,320


6,314


6,299













CAPITAL RATIOS











Total capital (to risk-weighted assets)

13.21 %


14.66 %


14.31 %


14.68 %


14.96 %


Tier 1 capital (to risk-weighted assets)

12.06 %


13.62 %


13.26 %


13.61 %


13.89 %


Tier 1 capital (to average assets)

11.48 %


12.21 %


11.99 %


12.29 %


12.38 %


     Equity to assets

11.14 %


12.34 %


12.16 %


12.53 %


12.14 %


     Tangible equity to tangible assets1 

10.45 %


11.90 %


11.71 %


12.06 %


11.66 %













CREDIT QUALITY DATA (Dollars in thousands)











     Net charge-offs (recoveries)

$        108


$        (15)


$        176


$        (10)


$        (23)


     Annualized net charge-offs (recoveries) to average loans

0.026 %


-0.004 %


0.045 %


-0.003 %


-0.006 %













     Nonperforming loans

$     2,330


$     3,198


$     2,115


$     6,708


$     6,755


     Other real estate owned

-


-


-


-


-


     Total nonperforming assets

$     2,330


$     3,198


$     2,115


$     6,708


$     6,755













     Allowance for credit losses as a percent of:











     Period-end loans, net of deferred fees and costs      

1.27 %


1.17 %


1.18 %


1.19 %


1.20 %


     Nonperforming loans

995.85 %


577.36 %


880.28 %


275.67 %


266.35 %


     Nonperforming assets 

995.85 %


577.36 %


880.28 %


275.67 %


266.35 %













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

0.13 %


0.20 %


0.13 %


0.43 %


0.45 %
























1This is a non-GAAP financial measure. For more information, see "Supplemental Information - Non-GAAP Financial Measures (Unaudited)" below.






 

Princeton Bancorp, Inc
Supplemental Information – Non-GAAP Financial Measures
 (Unaudited)

This press release contains certain supplemental financial information, described in the table below, which has been determined by methods other than U.S. Generally Accepted Accounting Principles ("GAAP") that management uses in its analysis of its performance. These non-GAAP financial measures are "tangible book value per common share," "return on average tangible equity," "efficiency ratio," "tangible equity to tangible assets," and "net interest margin on a fully taxable equivalent." For the purpose of calculating return on average tangible equity, net income for such period is annualized and divided by average tangible equity during such period. Average tangible equity equals average shareholders' equity during the applicable period less average goodwill and other intangible assets during the applicable period. For the purpose of calculating tangible equity to tangible assets, tangible equity is divided by tangible assets. Tangible equity equals total shareholders' equity less goodwill and other intangible assets, in each case at period end. Tangible assets equal total assets less goodwill and other intangible assets, in each case at period end. For the purpose of calculating tangible book value per common share, tangible equity is divided by the number of common shares outstanding, in each case at period end.  For the purpose of calculating efficiency ratio, total operating expense is divided by total revenue for the period. For the purpose of calculating net interest margin on a fully taxable equivalent, fully taxable equivalent adjustments are added to net interest income for the period, net interest income fully taxable equivalent for such period is annualized and divided by average interest earning assets during such period. Adjusted earnings per share and adjusted diluted earnings per share are calculated by dividing net income adjusted for the provision for credit loss on non-purchase credit deteriorated loans and merger-related expenses by weighted outstanding shares.

Management believes these non- GAAP financial measures provide information useful to investors in understanding its financial results. These non-GAAP measures should not be considered a substitute for GAAP basis measures and results and the Company strongly encourages investors to review its consolidated financial statements in their entirety and not to rely on any single financial measure. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names.

In addition to the items noted above, defined footnotes are included in the Supplemental Information – Non-GAAP Financial Measures table below. Income annualized is calculated using income for the period divided by the number of days in the period, then multiplied by total days in the year. Average equity is calculated using the sum of daily equity balance for the period, divided by the number of days in the period. Fully taxable equivalent adjustment is calculated using tax exempt loan income plus tax exempt securities income for the period, multiplied by a tax rate of 28%.

 

Princeton Bancorp, Inc.

Supplemental Information - Non-GAAP Financial Measures

(Unaudited)

(Dollars in thousands)













Three months ended



2024


2024


2024


2023


2023



September


June 


March 


December


September













Net (loss) income (annualized)1

$       (14,350)


$         20,617


$         17,428


$         20,956


$         30,144


Average equity2

254,645


241,550


240,230


234,628


228,404


Less: intangible assets

(18,241)


(10,044)


(10,154)


(10,275)


(10,399)


Average Tangible Equity

$       236,404


$       231,506


$       230,076


$       224,353


$       218,005


Return on average tangible equity

-6.07 %


8.91 %


7.60 %


9.34 %


13.83 %













Net interest income

$         17,109


$         15,968


$         15,448


$         16,010


$         16,684


Other income

2,056


2,087


1,985


1,779


2,403


Total revenue

19,165


18,055


17,433


17,789


19,087


Non-interest expenses

$         19,036


$         12,009


$         11,836


$         10,949


$         10,159


Less: core deposit intangible amortization

(143)


(111)


(120)


(124)


(119)


Less: merger-related expenses

(6,695)


-


-


-


1,391


Total operating expenses

$         12,198


$         11,898


$         11,716


$         10,825


$         11,431


Adjusted efficiency ratio

63.65 %


65.90 %


67.21 %


60.85 %


59.89 %













Total Assets

$    2,354,730


$    1,983,941


$    1,988,001


$    1,916,497


$    1,913,123


Less: intangible assets

(18,241)


(10,044)


(10,154)


(10,275)


(10,399)


Tangible assets

$    2,336,489


$    1,973,897


$    1,977,847


$    1,906,222


$    1,902,724













Stockholders' equity

$       262,351


$       244,841


$       241,808


$       240,211


$       232,208


Less: intangible assets

(18,241)


(10,044)


(10,154)


(10,275)


(10,399)


Tangible equity

$       244,110


$       234,797


$       231,654


$       229,936


$       221,809













Tangible equity to tangible assets

10.45 %


11.90 %


11.71 %


12.06 %


11.66 %













Tangible equity

$       244,110


$       234,797


$       231,654


$       229,936


$       221,809


Shares outstanding (in thousands)

6,876


6,350


6,320


6,315


6,299


Tangible book value per share

$          35.50


$          36.98


$          36.65


$          36.41


$          35.21













1Income annualized is calculated using income for the period divided by the number of days in the period, then multiplied by total days in the year.




2Average equity is calculated using the sum of daily equity balance for the period, divided by the number of days in the period. 


















Three months ended



2024


2024


2024


2023


2023



September


June 


March 


December


September













Net interest income

$         17,109


$         15,968


$         15,968


$         15,448


$         16,684


FTE adjustment3

211


213


226


224


215


Net interest income FTE

$         17,320


$         16,181


$         16,194


$         15,672


$         16,899


Net interest income FTE (annualized)1

$         68,902


$         65,078


$         65,132


$         62,862


$         67,045


Average interest earning assets

1,998,226


1,868,019


1,817,912


1,789,624


1,761,567


Net interest margin FTE

3.45 %


3.48 %


3.58 %


3.51 %


3.81 %














Nine months ended









2024


2023









September


September



















Net interest income

$         48,525


$         49,006








FTE adjustment3

612


580








Net interest income FTE

$         49,137


$         49,586








Net interest income FTE (annualized)1

$         65,635


$         66,540








Average interest earning assets

1,895,097


1,609,304








Net interest margin FTE

3.46 %


4.13 %



















1Income annualized is calculated using income for the period divided by the number of days in the period,





 then multiplied by total days in the year.











3Fully taxable equivalent adjustment is calculated using tax exempt loan income plus tax exempt securities






 income for the period, multiplied by a tax rate of 28%.











 

Princeton Bancorp, Inc.

Reconciliation of Non-GAAP Net Income to GAAP Net Income





























At or For the Three 


At or For the Nine



Months Ended September 30, 2024


Months Ended September 30, 2024



Actual


Cornerstone1


Core


Actual


Cornerstone1


Core



(Dollars in thousands, except per share data)

Net interest income

$    17,109


$            -


$   17,109


$    48,525


$              -


$    48,525

Provision for credit loss

4,601


3,152


1,449


4,669


3,152


1,517

Net interest income after provision

12,508


(3,152)


15,660


43,856


(3,152)


47,008

Non-interest income

2,056


-


2,056


6,128


-


6,128

Non-interest expense

19,036


6,695


12,341


42,881


6,695


36,186

Income (loss) before income taxes

(4,472)


(9,847)


5,375


7,103


(9,847)


16,950

Income tax (benefit) expense

(865)


(2,068)


1,203


1,239


(2,068)


3,307

Net (loss) income


$     (3,607)


$      (7,779)


$     4,172


$      5,864


$        (7,779)


$    13,643














Earnings per common share - basic

$      (0.55)




$       0.63


$        0.91




$        2.13

Earnings per common share - diluted

$      (0.55)




$       0.63


$        0.90




$        2.10














1 Reflects the CECL adjustment for non-purchase credit deteriorated loans and merger related expense impact to net income and tax-effected 


  using a federal income tax rate of 21%.












 

Contact George Rapp
 609.454.0718
 grapp@thebankofprinceton.com

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SOURCE The Bank of Princeton