FT Markets Data
Provident Bancorp Inc (Maryland)

Provident Bancorp, Inc. Reports Results for the March 31, 2025 Quarter

AMESBURY, Mass. , April 25, 2025 /PRNewswire/ -- Provident Bancorp, Inc. (the "Company") (NasdaqCM: PVBC), the holding company for BankProv (the "Bank"), reported net income for the quarter ended March 31, 2025 of $2.2 million, or $0.13 per diluted share, compared to $4.9 million, or $0.29 per diluted share, for the quarter ended December 31, 2024, and $5.0 million, or $0.30 per diluted share, for the quarter ended March 31, 2024. The Company's return on average assets was 0.58% for the quarter ended March 31, 2025, compared to 1.22% for the quarter ended December 31, 2024, and 1.26% for the quarter ended March 31, 2024. The Company's return on average equity was 3.71% for the quarter ended March 31, 2025, compared to 8.54% for the quarter ended December 31, 2024, and 8.93% for the quarter ended March 31, 2024.

In announcing these results, Joseph Reilly, Chief Executive Officer, said "We are pleased to report financial results consistent with expectations, despite the uncertainties presented by the current macroeconomic environment. We are closely monitoring our portfolios and proactively positioning the Bank to capitalize on any opportunities presented and mitigate exposure to potential risks of these volatile economic conditions. We remain focused on the execution of our strategic plan and continuing to build strong, lasting relationships within our markets. We are confident these efforts will be instrumental as we continue to serve the communities that have trusted BankProv for nearly 200 years, upholding our standard for the safety and security of our customers' financial assets, which includes deposit insurance coverage beyond federal limits through our participation in the Depositors Insurance Fund."

For the quarter ended March 31, 2025, net interest and dividend income was $12.9 million, a decrease of $768,000, or 5.6%, from the quarter ended December 31, 2024, and an increase of $389,000, or 3.1%, compared to the quarter ended March 31, 2024. The interest rate spread and net interest margin were 2.62% and 3.65%, respectively, for the quarter ended March 31, 2025, compared to 2.53% and 3.62%, respectively, for the quarter ended December 31, 2024, and 2.28% and 3.38%, respectively, for the quarter ended March 31, 2024.

Total interest and dividend income was $20.6 million for the quarter ended March 31, 2025, a decrease of $2.5 million, or 11.0%, from the quarter ended December 31, 2024, and a decrease of $1.5 million, or 6.6%, from the quarter ended March 31, 2024. The Company's yield on interest-earning assets was 5.84% for the quarter, down 30 basis points from the prior quarter, and down 13 basis points year-over-year due to the lower market interest rate environment. Interest and fees on loans decreased $2.2 million, or 10.4%, from the quarter ended December 31, 2024, and $762,000, or 3.8%, from the quarter ended March 31, 2024. These decreases were primarily driven by decreases in the average balance of loans of $80.7 million, or 5.9%, from December 31, 2024, and $31.7 million, or 2.4%, from March 31, 2024. The yield on loans was 5.98% for the quarter, which represents a decrease of 30 basis points from the quarter ended December 31, 2024, and a decrease of nine basis points from the quarter ended March 31, 2024. These decreases in yield reflect the impact of lower prevailing interest rates, coupled with the significant reduction in our enterprise value portfolio, which typically generates higher returns relative to our other portfolios.

Total interest expense was $7.7 million for the quarter ended March 31, 2025, a decrease of $1.8 million, or 18.7%, from the quarter ended December 31, 2024, and a decrease of $1.8 million, or 19.3%, from the quarter ended March 31, 2024. The decrease in interest expense was primarily driven by a decrease in the cost and average balance of interest-bearing deposits. The cost of interest-bearing deposits was 3.25% for the quarter ended March 31, 2025, a decrease of 28 basis points from 3.53% for the quarter ended December 31, 2024, and a decrease of 44 basis points from 3.69% for the quarter ended March 31, 2024. The average balance of interest-bearing deposits decreased $73.7 million, or 7.5%, from December 31, 2024, and $104.2 million, or 10.3%, from March 31, 2024. These decreases reflect our continued success in reducing high-cost brokered and listing service deposits, along with our proactive efforts to capture cost savings tied to prevailing interest rate trends. Interest expense on borrowings totaled $336,000 for the quarter ended March 31, 2025, a decrease of $479,000, or 58.8%, from the quarter ended December 31, 2024, and an increase of $127,000, or 60.8%, from the quarter ended March 31, 2024. The decrease in interest expense on borrowings from the prior quarter was primarily driven by a 188-basis point decrease in the cost of borrowings and a $21.8 million, or 31.4%, decrease in the average balance of borrowings. The increase in interest expense on borrowings from the quarter ended March 31, 2024, was primarily driven by an increase in the average balance of borrowings of $25.6 million, or 117.2%, partially offset by a 100-basis point decrease in the cost of borrowings. The Company's total cost of interest-bearing liabilities was 3.22% for the quarter ended March 31, 2025, a decrease of 39 basis points, from 3.61%, for the quarter ended December 31, 2024, and a decrease of 47 basis points from 3.69% for the quarter ended March 31, 2024.

The Company recognized a $12,000 credit loss benefit for the quarter ended March 31, 2025, compared to a $1.6 million benefit for the quarter ended December 31, 2024, and a $5.6 million benefit for the quarter ended March 31, 2024. The credit loss benefit for the quarter ended March 31, 2025 was primarily driven by a decrease in pooled reserves, mainly due to a $47.3 million decrease in the enterprise value portfolio, which typically carries a higher reserve rate than other loan segments. This was partially offset by a $647,000 increase in individually analyzed reserves on a $17.6 million enterprise value relationship which carried a total reserve of $10.8 million as of March 31, 2025. The credit loss benefits for the quarters ended December 31, 2024 and March 31, 2024, were primarily driven by successful workouts or recoveries on individually analyzed or previously charged-off loans. Net recoveries totaled $2,000 for the quarter ended March 31, 2025, compared to net recoveries of $867,000 for the quarter ended December 31, 2024, and net charge-offs of $22,000 for the quarter ended March 31, 2024. 

Noninterest income remained consistent at $1.4 million for the quarter ended March 31, 2025, $1.3 million for the quarter ended December 31, 2024, and $1.4 million for the quarter ended March 31, 2024. Noninterest expense was $11.4 million for the quarter ended March 31, 2025, compared to $10.1 million and $12.7 million for the quarters ended December 31, 2024 and March 31, 2024, respectively. The increase in noninterest expense from the prior quarter of $1.3 million, or 12.5%, was primarily driven by the reversal in the fourth quarter of 2024 of a $750,000 management fee accrual in connection with a loan modification, as well as an increase in salaries and employee benefits. The management fee reversal and prior period recoveries contributed to quarter over quarter declines in performance ratios, such as the return on average assets, return on average equity, and the efficiency ratio. Noninterest expense decreased $1.4 million, or 10.7%, compared to the quarter ended March 31, 2024, primarily due to lower professional fees as well as reduced salaries and employee benefits, reflecting the Bank's ongoing efforts to improve operational efficiency.

The Company recorded an income tax provision of $665,000 for the quarter ended March 31, 2025, reflecting an effective tax rate of 23.5%, compared to $1.5 million, or an effective tax rate of 24.0%, for the quarter ended December 31, 2024, and $1.7 million, or an effective tax rate of 25.5%, for the quarter ended March 31, 2024. 

Total assets were $1.55 billion at March 31, 2025, a decrease of $39.2 million, or 2.5%, from $1.59 billion at December 31, 2024. Cash and cash equivalents decreased $44.2 million, or 26.1% from December 31, 2024, primarily due to a decrease in total deposits. Net loans were $1.31 billion at March 31, 2025, an increase of $5.7 million, or 0.4%, from December 31, 2024. The increase in net loans was primarily driven by commercial loan growth of $36.7 million, or 4.9% and includes growth in the commercial, commercial real estate, and construction and land development loan segments. Mortgage warehouse loans also increased $16.9 million, or 6.5%, from December 31, 2024. This growth was partially offset by the decrease in enterprise value loans of $47.3 million, or 15.3%.

Mr. Reilly noted "The Bank has been successful in expanding our loan portfolio in the areas targeted for growth and reducing exposures in the enterprise value portfolio, rapidly shifting our mix from this riskier segment to traditional in-market commercial and commercial real estate. While we are disappointed to place an additional enterprise value relationship on non-accrual at quarter end, it illustrates the importance of remaining focused on reducing the exposure in this portfolio, which materially decreased by over 15% in the prior quarter alone. We are actively engaging with the borrower to mitigate the impact of this troubled credit and determine the most effective path to preserving the Bank's interest and reach a mutually agreeable resolution. While we are hopeful we can successfully mitigate our loss exposure, our lending and credit teams will continue evaluating the need for a reserve and if new information suggests a reserve is necessary, we will appropriately reserve such amounts."

The allowance for credit losses for loans was $21.2 million, or 1.59% of total loans, as of March 31, 2025, compared to $21.1 million, or 1.59% of total loans, as of December 31, 2024. Non-accrual loans were $31.4 million, or 2.02% of total assets, as of March 31, 2025, compared to $20.9 million, or 1.31% of total assets, as of December 31, 2024. The increase in non-accrual loans, along with the related downturn in asset quality ratios, as of March 31, 2025, was primarily driven by a $10.4 million enterprise value loan relationship that was placed on non-accrual status during the first quarter of 2025.

Total deposits were $1.18 billion at March 31, 2025, a decrease of $124.4 million, or 9.5%, from $1.31 billion at December 31, 2024. The decreases in deposits were primarily in areas where the Bank has intentionally scaled back its strategic focus, including specialty deposits which decreased $34.5 million, or 27.8%, deposits related to our enterprise value portfolio which decreased $13.1 million, or 8.7%, brokered deposits which decreased $25.2 million, or 16.8%, and deposits obtained through listing services which decreased $20.8 million, or 43.7%. Total borrowings were $127.5 million at March 31, 2025, an increase of $83.0 million, or 186.2%, from December 31, 2024. As a result of the decrease in deposits, the Bank utilized overnight borrowings to meet short-term liquidity obligations at March 31, 2025. The Bank will consider extending funding should the needs become permanent, however, opting for a more efficient short-term funding alternative preserves the Bank's optionality while navigating the current volatile economic environment.

As of March 31, 2025, shareholders' equity totaled $234.0 million, an increase of $2.9 million, or 1.3%, from December 31, 2024. The increase includes the Company's net income, which totaled $2.2 million for the quarter ended March 31, 2025. Shareholders' equity to total assets was 15.1% at March 31, 2025, compared to 14.5% at December 31, 2024. Book value per share was $13.16 at March 31, 2025, an increase from $12.99 at December 31, 2024. Market value per share increased to $11.48 at March 31, 2025, an increase of 0.7% from $11.40 at December 31, 2024. As of March 31, 2025, the Bank was categorized as well capitalized under the Federal Deposit Insurance Corporation regulatory framework for prompt corrective action.

About Provident Bancorp, Inc.

Provident Bancorp, Inc. (NASDAQ:PVBC) is the holding company for BankProv, a full-service commercial bank headquartered in Massachusetts. With retail branches in the Seacoast Region of Northeastern Massachusetts and New Hampshire, as well as commercial banking offices in the Manchester/Concord market in Central New Hampshire, BankProv delivers a unique combination of traditional banking services and innovative financial solutions to its markets. Founded in Amesbury, Massachusetts in 1828, BankProv holds the honor of being the 10th oldest bank in the nation. The Bank 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, visit bankprov.com.

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 on which they are given). These factors include: general economic conditions, including potential recessionary conditions; interest rates; inflation; 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; changes in consumer spending, borrowing and savings habits; competition; the imposition of tariffs or other domestic or international governmental policies; our ability to successfully shift the balance sheet to that of a traditional community bank; real estate values in the market area; loan demand; the adequacy of our level and methodology for calculating our allowance for credit 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; the ability of the Company or the Bank to effectively manage its growth; global and national war and terrorism; the impact of the COVID-19 pandemic or any other pandemic on our operations and financial results and those of our customers; 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 that 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.

Investor contact:
Joseph Reilly
President and Chief Executive Officer
Provident Bancorp, Inc.
jreilly@bankprov.com

 

 

Provident Bancorp, Inc.

Consolidated Balance Sheet










At



At




March 31,



December 31,




2025



2024


(Dollars in thousands)


(unaudited)






Assets









Cash and due from banks


$

21,444



$

27,536


Short-term investments



103,540




141,606


Cash and cash equivalents



124,984




169,142


Debt securities available-for-sale (at fair value)



25,199




25,693


Federal Home Loan Bank stock, at cost



2,696




2,697


Loans:









Commercial real estate



587,541




559,325


Construction and land development



32,401




28,097


Residential real estate



5,647




6,008


Mortgage warehouse



276,069




259,181


Commercial



168,087




163,927


Enterprise value



262,445




309,786


Consumer



165




271


Total Loans



1,332,355




1,326,595


Allowance for credit losses for loans



(21,160)




(21,087)


Net loans



1,311,195




1,305,508


Bank owned life insurance



46,344




46,017


Premises and equipment, net



10,021




10,188


Accrued interest receivable



4,968




5,296


Right-of-use assets



3,391




3,429


Deferred tax asset, net



13,399




13,808


Other assets



11,759




11,392


Total assets


$

1,553,956



$

1,593,170


Liabilities and Shareholders' Equity









Deposits:









Noninterest-bearing demand deposits


$

302,275



$

351,528


NOW



69,394




83,270


Regular savings



112,961




132,198


Money market deposits



445,313




463,687


Certificates of deposit



254,579




278,277


Total deposits



1,184,522




1,308,960


Borrowings:









Short-term borrowings



118,000




35,000


Long-term borrowings



9,529




9,563


Total borrowings



127,529




44,563


Operating lease liabilities



3,833




3,862


Other liabilities



4,037




4,698


Total liabilities



1,319,921




1,362,083


Shareholders' equity:









Preferred stock, $0.01 par value, 50,000 shares authorized; no shares issued and outstanding



—




—


Common stock, $0.01 par value, 100,000,000 shares authorized; 17,788,543 shares issued and outstanding at March 31, 2025 and December 31, 2024



178




178


Additional paid-in capital



125,895




125,446


Retained earnings



115,731




113,561


Accumulated other comprehensive loss



(1,476)




(1,625)


Unearned compensation - ESOP



(6,293)




(6,473)


Total shareholders' equity



234,035




231,087


Total liabilities and shareholders' equity


$

1,553,956



$

1,593,170


 

Provident Bancorp, Inc.

Consolidated Income Statements

(Unaudited)




Three Months Ended




March 31,



December 31,



March 31,


(Dollars in thousands, except per share data)


2025



2024



2024


Interest and dividend income:













Interest and fees on loans


$

19,307



$

21,541



$

20,069


Interest and dividends on debt securities available-for-sale



260




267




237


Interest on short-term investments



1,013




1,313




1,729


Total interest and dividend income



20,580




23,121




22,035


Interest expense:













Interest on deposits



7,369




8,663




9,340


Interest on short-term borrowings



306




789




178


Interest on long-term borrowings



30




26




31


Total interest expense



7,705




9,478




9,549


Net interest and dividend income



12,875




13,643




12,486


Credit loss expense (benefit) - loans



70




(1,703)




(5,543)


Credit loss (benefit) expense - off-balance sheet credit exposures



(82)




136




(38)


Total credit loss benefit



(12)




(1,567)




(5,581)


Net interest and dividend income after credit loss benefit



12,887




15,210




18,067


Noninterest income:













Customer service fees on deposit accounts



715




661




674


Service charges and fees - other



276




325




309


Bank owned life insurance income



327




334




302


Other income



62




5




71


Total noninterest income



1,380




1,325




1,356


Noninterest expense:













Salaries and employee benefits



7,576




6,963




8,145


Occupancy expense



448




364




443


Equipment expense



144




139




152


Deposit insurance



332




319




333


Data processing



421




404




413


Marketing expense



45




43




18


Professional fees



569




585




1,314


Directors' compensation



195




198




174


Software depreciation and implementation



553




614




543


Insurance expense



221




303




301


Service fees



318




248




242


Other



610




(66)




657


Total noninterest expense



11,432




10,114




12,735


Income before income tax expense



2,835




6,421




6,688


Income tax expense



665




1,539




1,707


Net income


$

2,170



$

4,882



$

4,981


Earnings per share:













Basic


$

0.13



$

0.29



$

0.30


Diluted


$

0.13



$

0.29



$

0.30


Weighted Average Shares:













Basic



16,822,196




16,783,976




16,669,451


Diluted



16,924,083




16,864,240




16,720,653


 

Provident Bancorp, Inc.

Net Interest Income Analysis

(Unaudited)




For the Three Months Ended




March 31, 2025


December 31, 2024



March 31, 2024








Interest








Interest











Interest








Average



Earned/


Yield/


Average



Earned/



Yield/



Average



Earned/



Yield/


(Dollars in thousands)


Balance



Paid


Rate (5)


Balance



Paid



Rate (5)



Balance



Paid



Rate (5)


Assets:


































Interest-earning assets:


































Loans (1)


$

1,291,583



$

19,307


5.98 %


$

1,372,245



$

21,541




6.28

%


$

1,323,260



$

20,069




6.07

%

Short-term investments



90,198




1,013


4.49 %



104,385




1,313




5.03

%



123,546




1,729




5.60

%

Debt securities available-for-sale



25,594




190


2.97 %



26,871




194




2.89

%



28,234




205




2.90

%

Federal Home Loan Bank stock



2,696




70


10.39 %



3,609




73




8.09

%



1,783




32




7.18

%

Total interest-earning assets



1,410,071




20,580


5.84 %



1,507,110




23,121




6.14

%



1,476,823




22,035




5.97

%

Noninterest earning assets



92,277









94,795












98,890










Total assets


$

1,502,348








$

1,601,905











$

1,575,713










Liabilities and shareholders' equity:


































Interest-bearing liabilities:


































Savings accounts


$

118,713



$

264


0.89 %


$

158,626



$

777




1.96

%


$

244,148



$

1,961




3.21

%

Money market accounts



447,792




3,756


3.36 %



469,922




4,363




3.71

%



454,883




4,238




3.73

%

NOW accounts



72,893




257


1.41 %



80,645




340




1.69

%



82,831




183




0.88

%

Certificates of deposit



268,879




3,092


4.60 %



272,803




3,183




4.67

%



230,616




2,958




5.13

%

Total interest-bearing deposits



908,277




7,369


3.25 %



981,996




8,663




3.53

%



1,012,478




9,340




3.69

%

Borrowings


































Short-term borrowings



37,922




306


3.23 %



59,641




789




5.29

%



12,181




178




5.85

%

Long-term borrowings



9,542




30


1.26 %



9,574




26




1.09

%



9,675




31




1.28

%

Total borrowings



47,464




336


2.83 %



69,215




815




4.71

%



21,856




209




3.83

%

Total interest-bearing liabilities



955,741




7,705


3.22 %



1,051,211




9,478




3.61

%



1,034,334




9,549




3.69

%

Noninterest-bearing liabilities:


































Noninterest-bearing deposits



304,601









312,382












306,349










Other noninterest-bearing liabilities



8,277









9,779












12,041










Total liabilities



1,268,619









1,373,372












1,352,724










Total equity



233,729









228,533












222,989










Total liabilities and equity


$

1,502,348








$

1,601,905











$

1,575,713










Net interest income






$

12,875








$

13,643











$

12,486






Interest rate spread (2)









2.62 %











2.53

%











2.28

%

Net interest-earning assets (3)


$

454,330








$

455,899











$

442,489










Net interest margin (4)









3.65 %











3.62

%











3.38

%

Average interest-earning assets to interest-bearing liabilities



147.54

%








143.37

%











142.78

%











(1)

Interest earned/paid on loans includes $780,000, $833,000, and $734,000 in loan fee income for the three months ended March 31, 2025, December 31, 2024, and March 31, 2024, respectively.



(2)

Interest rate spread represents the difference between the weighted average yield on interest-bearing assets and the weighted average rate of interest-bearing liabilities.



(3)

Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.



(4)

Net interest margin represents net interest income divided by average total interest-earning assets.



(5)

Annualized.

 

Provident Bancorp, Inc.

Select Financial Highlights

(Unaudited)




Three Months Ended




March 31,



December 31,



March 31,




2025



2024



2024


Performance Ratios:













Return on average assets (1)



0.58

%



1.22

%



1.26

%

Return on average equity (1)



3.71

%



8.54

%



8.93

%

Interest rate spread (1) (2)



2.62

%



2.53

%



2.28

%

Net interest margin (1) (3)



3.65

%



3.62

%



3.38

%

Noninterest expense to average assets (1)



3.04

%



2.53

%



3.23

%

Efficiency ratio (4)



80.20

%



67.57

%



92.00

%

Average interest-earning assets to average interest-bearing liabilities



147.54

%



143.37

%



142.78

%

Average equity to average assets



15.56

%



14.27

%



14.15

%

 

At



At



At




March 31,



December 31,



March 31,


(Dollars in thousands)


2025



2024



2024


Asset Quality













Non-accrual loans:













Commercial real estate


$

217



$

57



$

—


Residential real estate



360




366




357


Commercial



1,543




1,543




1,923


Enterprise value



29,298




18,920




—


Digital asset



—




—




10,071


Consumer



1




1




1


Total non-accrual loans



31,419




20,887




12,352


Total non-performing assets


$

31,419



$

20,887



$

12,352















Asset Quality Ratios













Allowance for credit losses for loans as a percent of total loans (5)



1.59

%



1.59

%



1.18

%

Allowance for credit losses for loans as a percent of non-performing loans



67.35

%



100.96

%



129.58

%

Non-performing loans as a percent of total loans (5)



2.36

%



1.57

%



0.91

%

Non-performing loans as a percent of total assets



2.02

%



1.31

%



0.74

%














Capital and Share Related













Shareholders' equity to total assets



15.06

%



14.50

%



13.70

%

Book value per share


$

13.16



$

12.99



$

12.87


Market value per share


$

11.48



$

11.40



$

9.10


Shares outstanding



17,788,543




17,788,543




17,659,146




(1)

Annualized.



(2)

Interest rate spread represents the difference between the weighted average yield on average interest-earning assets and the weighted average cost of interest-bearing liabilities.



(3)

Net interest margin represents net interest income as a percent of average interest-earning assets.



(4)

The efficiency ratio represents noninterest expense divided by the sum of net interest income and noninterest income, excluding gains on securities available for sale, net (if applicable).



(5)

Loans are presented at amortized cost.

 

 

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SOURCE Provident Bancorp, Inc.