STAMFORD, Conn., July 29, 2016 (GLOBE NEWSWIRE) -- Patriot National Bancorp, Inc. (“Patriot”, “Bancorp” or the “Company”) (NASDAQ:PNBK), the parent company of Patriot Bank, N.A. (the “Bank”), today reported net income of $614,000 for the second quarter, or $0.16 diluted income per share. This is compared to $689,000 a year ago, or $0.18 diluted income per share. In the first quarter of 2016, the Company reported $653,000 net income, or $0.16 diluted income per share.
As of June 30, 2016, total assets have increased to $653 million (up 2.7%), compared to $636 million at March 31, 2016 and $629 million at June 30, 2015. Net loans totaled $523 million (up 9%) at June 30, 2016 compared to $480 million at March 31, 2016 and $489 million at June 30, 2015.
Kenneth T. Neilson, President and CEO stated, “Growth has, and will continue to be, our primary focus. We have spent the last few years building a solid banking infrastructure, which has given us the foundation to confidently go forward with building our brand, hiring and training additional staff, creating and delivering a best-in-class customer experience, and showing by doing in the communities we serve.”
Michael Carrazza, Chairman said, “We continue to look for opportunities to better leverage our infrastructure and improve our returns.”
Net interest income before provision for loan losses decreased by $43,000, or less than one percent, compared to the first quarter of 2016 and decreased by $67,000, or 1.2%, as compared to the second quarter of 2015. The decline in net interest income this quarter, over the prior year’s second quarter and the current year’s previous quarter, is the result of a decrease in loan prepayment fees as the trend of fewer loan prepayments continues. Patriot’s loan portfolio actually increased by $43 million during the second quarter. The loan pipeline remains strong and continued growth is expected. Patriot’s net interest margin was 3.69% for the second quarter compared to 3.76% in the prior quarter and 3.73% in the second quarter of 2015.
No provisions for loan losses have been recorded since the first quarter of 2015. The credit quality of our portfolio and continued improvement in regional economic trends has allowed us to avoid increasing reserves. The Company has now experienced seven consecutive quarters of net loan recoveries.
Non-interest income decreased by $45,000, or 11%, over last quarter and by $86,000, or 19%, over the same period last year. Fewer loan fees in the second quarter of 2016 were the primary cause of these decreases.
Non-interest expense in the second quarter of 2016 decreased $28,000, or 1%, compared to the first quarter of 2016 which is on target with the Company’s business plan. Compared to the second quarter of 2015, non-interest expenses declined by $23,000 as a result of continued cost control.
Deposits were $449 million (up 5.4%) at June 30, 2016 compared to $426 million at March 31, 2016 and $457 million at June 30, 2015. Deposit growth initiatives are in place to increase deposits.
As of June 30, 2016, shareholders’ equity was $63.1 million compared to $62.3 million at March 31, 2016 and $60.1 million a year ago. The Company’s book value per share was $15.94 at June 30, 2016 compared to $15.75 at March 31, 2016 and $15.19 at June 30, 2015.
The Bank’s capital ratios continue to be strong as the Bank maintained its “well capitalized” regulatory status. As of June 30, 2016, Tier 1 leverage ratio was 10.13%, Tier 1 risk based capital was 11.21% and total risk based capital was 12.16%.
About the Company
Patriot National Bancorp, Inc. is headquartered in Stamford, Connecticut and the Bank has 10 full service branches, eight in Connecticut and two in New York.
Since opening its doors in 1994, the Company’s mission has been to serve our local communities by helping our neighbors and neighborhood businesses thrive. All lending is handled locally and is specific to each borrower, and the commitment to local businesses goes further to connect, support and grow businesses in both the for-profit and nonprofit sectors, along with municipalities. Patriot believes a well-connected community is a strong community—and that together, all will prosper.
“Safe Harbor” Statement Under Private Securities Litigation Reform Act of 1995
Certain statements contained in Bancorp’s public statements, including this one, may be forward looking and subject to a variety of risks and uncertainties. These factors include, but are not limited to, (1) changes in prevailing interest rates which would affect the interest earned on Bancorp’s interest earning assets and the interest paid on its interest bearing liabilities, (2) the timing of repricing of Bancorp’s interest earning assets and interest bearing liabilities, (3) the effect of changes in governmental monetary policy, (4) the effect of changes in regulations applicable to Bancorp and the Bank and the conduct of its business, (5) changes in competition among financial service companies, including possible further encroachment of non-banks on services traditionally provided by banks, (6) the ability of competitors that are larger than Bancorp to provide products and services which it is impracticable for Bancorp to provide, (7) the state of the economy and real estate values in Bancorp’s market areas, and the consequent effect on the quality of Bancorp’s loans, (8) recent governmental initiatives that are expected to have a profound effect on the financial services industry and could dramatically change the competitive environment of the Company, (9) other legislative or regulatory changes, including those related to residential mortgages, changes in accounting standards, and Federal Deposit Insurance Corporation (“FDIC”) premiums that may adversely affect the Company, (10) the application of generally accepted accounting principles, consistently applied, (11) the fact that one period of reported results may not be indicative of future periods, (12) the state of the economy in the greater New York metropolitan area and its particular effect on the Company’s customers, vendors and communities and other such factors, including risk factors, as may be described in Bancorp’s other filings with the SEC.
| PATRIOT NATIONAL BANCORP, INC. | |||||||||||
| CONSOLIDATED BALANCE SHEETS | |||||||||||
| (Unaudited) | |||||||||||
| Dollars in thousands | June 30, 2016 | March 31, 2016 | June 30, 2015 | ||||||||
| Assets | |||||||||||
| Noninterest bearing deposits and cash | $ | 2,893 | $ | 2,931 | $ | 2,892 | |||||
| Interest bearing deposits | 43,594 | 64,075 | 50,201 | ||||||||
| Total cash and cash equivalents | 46,487 | 67,006 | 53,093 | ||||||||
| Securities-available for sale | 23,037 | 28,735 | 31,640 | ||||||||
| Other investments | 4,450 | 4,450 | 4,450 | ||||||||
| FRB & FHLB stock | 7,982 | 8,669 | 8,648 | ||||||||
| Total securities | 35,469 | 41,854 | 44,738 | ||||||||
| Gross loans | 528,654 | 485,183 | 493,913 | ||||||||
| Allowance for loan losses | (5,250 | ) | (5,247 | ) | (5,208 | ) | |||||
| Net loans | 523,404 | 479,936 | 488,705 | ||||||||
| Accrued interest and dividends receivable | 2,120 | 2,075 | 2,034 | ||||||||
| Premises and equipment, net | 29,972 | 29,790 | 24,703 | ||||||||
| Other real estate owned | 851 | - | - | ||||||||
| Deferred tax asset, net | 13,073 | 13,354 | 14,221 | ||||||||
| Other assets | 1,679 | 1,740 | 1,407 | ||||||||
| Total Assets | $ | 653,055 | $ | 635,755 | $ | 628,901 | |||||
| Liabilities and Shareholders' Equity | |||||||||||
| Deposits | |||||||||||
| Noninterest bearing deposits | $ | 75,244 | $ | 79,483 | $ | 79,774 | |||||
| Interest bearing deposits | 371,092 | 344,488 | 375,420 | ||||||||
| 446,336 | 423,971 | 455,194 | |||||||||
| FHLB advances and repurchase agreements | 128,000 | 134,900 | 100,000 | ||||||||
| Subordinated debt | 8,248 | 8,248 | 8,248 | ||||||||
| Mortgage escrow deposits | 2,451 | 1,666 | 2,261 | ||||||||
| Note Payable | 1,846 | 1,893 | - | ||||||||
| Accrued expenses and other liabilities | 3,064 | 2,771 | 3,121 | ||||||||
| Total Liabilities | 589,945 | 573,449 | 568,824 | ||||||||
| Common stock | 40 | 40 | 40 | ||||||||
| Treasury stock | (160 | ) | (160 | ) | (160 | ) | |||||
| Additional paid-in capital | 106,876 | 106,722 | 106,335 | ||||||||
| Accumulated deficit | (43,565 | ) | (44,179 | ) | (45,997 | ) | |||||
| Accumulated other comprehensive loss | (81 | ) | (117 | ) | (141 | ) | |||||
| Total Shareholders' Equity | 63,110 | 62,306 | 60,077 | ||||||||
| Total Liabilities and Shareholders' Equity | $ | 653,055 | $ | 635,755 | $ | 628,901 | |||||
| PATRIOT NATIONAL BANCORP, INC. | |||||||||||||||||||
| STATEMENTS OF OPERATIONS | |||||||||||||||||||
| (Unaudited) | Three Months Ended | Six Months Ended | |||||||||||||||||
| Dollars in thousands, except per share data | June 30, 2016 | March 31, 2016 | June 30, 2015 | June 30, 2016 | June 30, 2015 | ||||||||||||||
| Interest and dividend income | |||||||||||||||||||
| Interest and fees on loans | $ | 5,783 | $ | 5,840 | $ | 5,924 | $ | 11,623 | $ | 11,470 | |||||||||
| Interest on investment securities | 132 | 142 | 119 | 274 | 235 | ||||||||||||||
| Dividends on investment securities | 90 | 86 | 60 | 176 | 117 | ||||||||||||||
| Other interest income | 28 | 41 | 17 | 69 | 46 | ||||||||||||||
| Total interest and dividend income | 6,033 | 6,109 | 6,120 | 12,142 | 11,868 | ||||||||||||||
| Interest expense | |||||||||||||||||||
| Interest on deposits | 496 | 473 | 513 | 969 | 1,042 | ||||||||||||||
| Interest on Federal Home Loan Bank borrowings | 64 | 121 | 85 | 185 | 156 | ||||||||||||||
| Interest on subordinated debt | 83 | 82 | 73 | 165 | 144 | ||||||||||||||
| Interest on other borrowings | 8 | 8 | - | 16 | - | ||||||||||||||
| Total interest expense | 651 | 684 | 671 | 1,335 | 1,342 | ||||||||||||||
| Net interest income | 5,382 | 5,425 | 5,449 | 10,807 | 10,526 | ||||||||||||||
| Provision for loan losses | - | - | - | - | 250 | ||||||||||||||
| Net interest income after provision for loan losses | 5,382 | 5,425 | 5,449 | 10,807 | 10,276 | ||||||||||||||
| Non-interest income | |||||||||||||||||||
| Loan application, inspection and processing fees | 21 | 67 | 105 | 88 | 155 | ||||||||||||||
| Fees and service charges | 150 | 151 | 147 | 301 | 321 | ||||||||||||||
| Rental Income | 104 | 103 | 110 | 207 | 198 | ||||||||||||||
| Other income | 90 | 89 | 89 | 179 | 171 | ||||||||||||||
| Total non-interest income | 365 | 410 | 451 | 775 | 845 | ||||||||||||||
| Non-interest expense | |||||||||||||||||||
| Salaries and benefits | 2,615 | 2,550 | 2,395 | 5,165 | 4,739 | ||||||||||||||
| Occupancy and equipment expense | 750 | 780 | 909 | 1,530 | 1,864 | ||||||||||||||
| Data processing | 241 | 285 | 255 | 526 | 505 | ||||||||||||||
| Professional services and other outside services | 364 | 409 | 391 | 773 | 960 | ||||||||||||||
| Advertising and promotional expenses | 96 | 117 | 137 | 213 | 187 | ||||||||||||||
| Loan administration and processing expenses | 8 | 8 | 7 | 16 | 29 | ||||||||||||||
| Regulatory assessments | 147 | 147 | 157 | 294 | 311 | ||||||||||||||
| Insurance expense | 56 | 55 | 83 | 111 | 164 | ||||||||||||||
| Material and communications | 115 | 93 | 106 | 208 | 187 | ||||||||||||||
| Other operating expenses | 344 | 320 | 319 | 664 | 544 | ||||||||||||||
| Total non-interest expense | 4,736 | 4,764 | 4,759 | 9,500 | 9,490 | ||||||||||||||
| Income before income taxes | 1,011 | 1,071 | 1,141 | 2,082 | 1,631 | ||||||||||||||
| Expense for income taxes | 397 | 418 | 452 | 815 | 653 | ||||||||||||||
| Net income | $ | 614 | $ | 653 | $ | 689 | $ | 1,267 | $ | 978 | |||||||||
| Basic income per share (1) | $ | 0.16 | $ | 0.17 | $ | 0.18 | $ | 0.32 | $ | 0.25 | |||||||||
| Diluted income per share | $ | 0.16 | $ | 0.16 | $ | 0.18 | $ | 0.32 | $ | 0.25 | |||||||||
| (1) Basic income per share for the six months ended June 30, 2016 does not equal the sum of basic income per share for the first two quarters due to the effects of rounding. | |||||||||||||||||||
| PATRIOT NATIONAL BANCORP, INC. | |||||||||||
| FINANCIAL RATIOS AND OTHER DATA | |||||||||||
| (Unaudited) | |||||||||||
| Dollars in thousands, except per share data | |||||||||||
| June 30, 2016 | March 31, 2016 | June 30, 2015 | |||||||||
| Asset Quality: | |||||||||||
| Nonaccrual loans | $ | 4,790 | $ | 5,409 | $ | 511 | |||||
| Other real estate owned | 851 | - | - | ||||||||
| Total nonperforming assets | $ | 5,641 | $ | 5,409 | $ | 511 | |||||
| Nonaccrual loans / loans | 0.91 | % | 1.11 | % | 0.10 | % | |||||
| Nonperforming assets / assets | 0.86 | % | 0.85 | % | 0.08 | % | |||||
| Allowance for loan losses | $ | 5,250 | $ | 5,247 | $ | 5,208 | |||||
| Allowance for loan losses / loans | 0.99 | % | 1.08 | % | 1.05 | % | |||||
| Allowance / nonaccrual loans | 109.6 | % | 97.0 | % | 1019.2 | % | |||||
| Gross loan charge-offs for the quarter | $ | 2 | $ | 5 | $ | - | |||||
| Gross loan (recoveries) for the quarter | $ | (4 | ) | $ | (10 | ) | $ | (15 | ) | ||
| Net loan charge-offs (recoveries) for the quarter | $ | (2 | ) | $ | (5 | ) | $ | (15 | ) | ||
| Capital Data: | |||||||||||
| Book value per share (1) | $ | 15.94 | $ | 15.75 | $ | 15.19 | |||||
| Shares outstanding | 3,958,733 | 3,956,207 | 3,953,949 | ||||||||
| (1) Book value per share represents shareholders' equity divided by outstanding shares. | |||||||||||