137 0 Kommentare Private Bancorp of America, Inc. Announces Strong Net Income and Earnings Per Share for First Quarter 2024

First Quarter 2024 Highlights

Net income for the first quarter of 2024 of $7.9 million, compared to $7.9 million in the prior quarter and $9.0 million in the first quarter of 2023. Net income for the first quarter of 2024 represents a return on average assets of 1.48% and a return on average tangible common equity of 16.86%
Diluted earnings per share for the first quarter of 2024 of $1.36, compared to $1.36 in the prior quarter and $1.57 in the first quarter of 2023
Loans held-for-investment (“HFI”) totaled $1.91 billion as of March 31, 2024, an increase of $59.8 million or 3.2% (13.0% annualized) from December 31, 2023. Loans HFI increased 17.5% year over year
Provision for credit losses for the first quarter of 2024 was $0.2 million, compared to $0.5 million for the prior quarter and $0.1 million for the first quarter of 2023. The allowance for loan losses was 1.29% of loans HFI as of March 31, 2024
Total deposits were $1.90 billion as of March 31, 2024, an increase of $29.3 million or 1.6% (6.3% annualized) from December 31, 2023. Federal Home Loan Bank advances decreased by $4.0 million as a consequence of deposit growth. Core deposits were $1.61 billion as of March 31, 2024, an increase of $22.1 million or 1.4% from December 31, 2023
Net interest margin was 4.31% for the first quarter of 2024, as compared to 4.33% for the prior quarter and 4.90% for the first quarter of 2023
Total cost of funding sources was 2.70% for the first quarter of 2024, an increase from 2.53% in the prior quarter and 1.39% in the first quarter of 2023
Tangible book value per share was $33.55 as of March 31, 2024, an increase of $1.47 since December 31, 2023 as a result of strong earnings. Tangible book value per share increased 4.6% quarter-over-quarter and 27.6% year over year.

LA JOLLA, Calif., April 19, 2024 (GLOBE NEWSWIRE) -- Private Bancorp of America, Inc. (OTCQX: PBAM), (“Company”) and CalPrivate Bank (“Bank”) announced unaudited financial results for the first fiscal quarter ended March 31, 2024. The Company reported net income of $7.9 million, or $1.36 per diluted share, for the first quarter of 2024, compared to $7.9 million, or $1.36, in the prior quarter, and $9.0 million, or $1.57, in the first quarter of 2023.

Rick Sowers, President and CEO of the Company and the Bank stated, “We are pleased with our Team’s ability to continue to grow the balance sheet and bring on new Clients. By putting the Client at the center of what we do, we are able to exceed expectations and earn their Trust. Our Service and Relationship Teams continue to excel in a challenging environment. Our performance is a reflection of our Client focused, profit driven mindset. Our goal continues to be adding value for our Team, our Clients and our Shareholders.”

Sowers added, “We view this as an opportunistic market. We continue to hire great bankers who share our culture and passion for Client service. Disruption in our markets continues to provide opportunities for us to grow and we fully intend to take advantage of those. To support that growth, we continue to forge ahead with infrastructure and technology investments to support our business and private banking clients, both now and into the future.”

“The Company continues to exhibit successful customer acquisition activity despite a challenging interest rate environment. Additionally, the Company is investing in people and infrastructure, including strong risk management, product strategy and innovation needed to support the continued growth of the CalPrivate franchise,” said Selwyn Isakow, Chairman of the Board of the Company and the Bank.

STATEMENT OF INCOME

Net Interest Income

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Net interest income for the first quarter of 2024 totaled $22.8 million, an increase of $0.6 million or 2.6% from the prior quarter and an increase of $0.6 million or 2.7% from the first quarter of 2023. The increase from the prior quarter was driven primarily by 4.4% growth in interest-earning assets and a 14 basis point increase in asset yields as interest income increased by $1.7 million. Partially offsetting this was an increase of $1.1 million in interest expense, which resulted from a 8.2% increase in average interest bearing-liabilities and a 9 basis point increase in the cost of interest-bearing liabilities.

Net Interest Margin

Net interest margin for the first quarter of 2024 was 4.31%, compared to 4.33% for the prior quarter and 4.90% in the first quarter of 2023. The 2 basis point decrease in net interest margin from the prior quarter was due primarily to higher rates paid on deposits, partially offset by higher rates on new loan originations and variable rate loans and investment securities. The yield on earning assets was 6.78% for the first quarter of 2024 compared to 6.64% for the prior quarter, and the cost of interest-bearing liabilities was 3.77% for the first quarter of 2024 compared to 3.68% in the prior quarter. The cost of total deposits was 2.61% for the first quarter of 2024 compared to 2.41% in the prior quarter. The cost of core deposits, which excludes brokered deposits, was 2.14% in the first quarter of 2024 compared to 1.93% in the prior quarter. The spot rate for total deposits was 2.66% as of March 31, 2024, compared to 2.49% at December 31, 2023.

Provision for Credit Losses

Provision expense for credit losses for the first quarter of 2024 was $0.2 million, compared to $0.5 million in the prior quarter and $0.1 million for the first quarter of 2023. For more details, please refer to the “Asset Quality” section below.

Noninterest Income

Noninterest income was $1.4 million for the first quarter of 2024, compared to $1.2 million in the prior quarter and $1.5 million in the first quarter of 2023. SBA loan sales for the first quarter of 2024 were $8.9 million with a 10.84% average trade premium resulting in a net gain on sale of $681 thousand, compared with $6.7 million with a 9.62% average trade premium resulting in a net gain on sale of $436 thousand in the prior quarter. Management expects continued softness in the market for SBA 7a loans.

Noninterest Expense

Noninterest expense was $12.8 million for the first quarter of 2024, compared to $11.8 million in the prior quarter and $11.6 million in the first quarter of 2023. Compensation and employee benefits expense increased $919 thousand compared to the prior quarter driven by seasonal increases to benefit expenses and employer taxes, annual merit increases and adjustments to share-based compensation. The efficiency ratio was 52.84% for the first quarter of 2024 compared to 50.22% in the prior quarter and 48.90% in the first quarter of 2023. The increase in the efficiency ratio from the prior quarter was due primarily to the aforementioned increases in compensation and employee benefits expense.

The Company remains committed to making investments in the business, including technology, marketing, and staffing. Inflationary pressures and low unemployment continue to have an impact on rising wages as well as increased costs related to third party service providers, which we proactively monitor and manage.

Provision for Income Tax Expense

Provision for income tax expense was $3.3 million for the first quarter of 2024, compared to $3.3 million for the prior quarter. The effective tax rate for the first quarter of 2024 was 29.5%, compared to 29.9% in the prior quarter and 25.2% in the first quarter of 2023.

STATEMENT OF FINANCIAL CONDITION

As of March 31, 2024, total assets were $2.19 billion, an increase of $35.3 million since December 31, 2023. The increase in assets from the prior quarter was primarily due to higher loans receivable and investment securities, partially offset by the decrease in cash balances. Total cash and due from banks was $141.5 million as of March 31, 2024, a decrease of $36.6 million or 20.5%, since December 31, 2023, primarily due to the use of funds that were deposited at the end of the prior quarter. Loans HFI totaled $1.91 billion as of March 31, 2024, an increase of $59.8 million or 3.2% since December 31, 2023. Investment securities available for sale (“AFS”) were $114.1 million as of March 31, 2024, an increase of $11.6 million or 11.3% since December 31, 2023 as a result of new securities purchased. As of March 31, 2024, the net unrealized loss on the AFS investment securities portfolio, which is comprised mostly of US Treasury and Government Agency debt, was $12.4 million (pre-tax) compared to a loss of $12.1 million (pre-tax) as of December 31, 2023. The average duration of the Bank’s AFS portfolio is 3.6 years. The Company has no held-to-maturity securities.

Total deposits were $1.90 billion as of March 31, 2024, an increase of $29.3 million since December 31, 2023. During the quarter, core deposits increased by $22.1 million, which was driven by a $78.5 million increase in interest-bearing core deposits (including balances in the Intrafi ICS and CDARS programs), partially offset by a $56.5 million decrease in noninterest-bearing core deposits. Deposit mix has continued to shift while short-term interest rates remain higher. Noninterest-bearing deposits represent 32.1% of total core deposits. Uninsured deposits, net of collateralized and fiduciary deposit accounts, represent 46.3% of total deposits as of March 31, 2024.

As of March 31, 2024, total available liquidity was $1.6 billion or 181% of uninsured deposits, net of collateralized and fiduciary deposit accounts. Total available liquidity is comprised of $247 million of on-balance sheet liquidity (cash and investment securities) and $1.4 billion of unused borrowing capacity.

Asset Quality and Allowance for Credit Losses ("ACL")

As of March 31, 2024, the allowance for loan losses was $24.7 million or 1.29% of loans HFI, compared to $24.5 million or 1.33% as of December 31, 2023. The decrease in the coverage ratio from December 31, 2023 primarily reflects improvements in the economic forecasts used for estimating credit losses. The Company continues to have strong credit metrics and its nonperforming assets are 0.21% of total assets as of March 31, 2024. The reserve for unfunded commitments was $1.7 million as of March 31, 2024, compared to $1.7 million as of December 31, 2023. Given the credit quality of the loan portfolio, management believes we are sufficiently reserved.

At March 31, 2024 and December 31, 2023, there are no doubtful credits and classified assets were $10.8 million and $11.0 million, respectively. Total classified assets consisted of nine loans as of March 31, 2024, which included six loans totaling $6.9 million secured by real estate with a weighted average LTV of 43.3%. The remaining three loans were commercial and industrial loans, the first of which was an SBA loan with a balance of $1.0 million, which is 90% guaranteed by the SBA, the second had a balance of $0.3 million and was secured by a UCC-1 lien and the third was a $2.5 million nonaccrual loan with a specific reserve of $1.75 million.

Capital Ratios ⁽²⁾

The Bank’s capital ratios were in excess of the levels established for “well capitalized” institutions and are as follows:

	March 31, 2024 ⁽²⁾	December 31, 2023
CalPrivate Bank
Tier I leverage ratio	10.08%	10.07%
Tier I risk-based capital ratio	11.20%	11.02%
Total risk-based capital ratio	12.45%	12.27%

(2) March 31, 2024 capital ratios are preliminary and subject to change.

About Private Bancorp of America, Inc.

Private Bancorp of America, Inc. (OTCQX: PBAM), is the holding company for CalPrivate Bank. CalPrivate Bank provides a Distinctly Different banking experience through unparalleled service and creative funding solutions to high-net-worth individuals, professionals, locally owned businesses, and real estate entrepreneurs. Customers are serviced through offices in Coronado, San Diego, La Jolla, Newport Beach, El Segundo and Beverly Hills as well as efficient electronic banking offerings. The Bank also offers various portfolio and government guaranteed lending programs, including SBA and cross-border Export-Import Bank programs. CalPrivate Bank is an SBA Preferred Lender and a Bauer Financial 5-star rated bank.

CalPrivate Bank’s website is www.calprivate.bank.

Non-GAAP Financial Measures

This press release contains certain non-GAAP financial measures in addition to results presented in accordance with GAAP, including adjusted income before provision for income taxes, adjusted net income, adjusted diluted earnings per share (“Adjusted EPS”), efficiency ratio, adjusted efficiency ratio, pretax pre-provision net revenue, average tangible common equity, adjusted return on average assets, return on average tangible common equity and adjusted return on average tangible common equity. The Company uses certain non-GAAP financial measures to provide meaningful supplemental information regarding the Company's results of operations and financial condition and to enhance investors’ overall understanding of such results of operations and financial condition, permit investors to effectively analyze financial trends of our business activities, and enhance comparability with peers across the financial services sector. These non-GAAP financial measures should be considered in addition to, not as a substitute for or superior to, financial measures prepared in accordance with GAAP and should be read in conjunction with the Company’s GAAP financial information. A reconciliation of the most comparable GAAP financial measures to non-GAAP financial measures is included in the accompanying financial tables.

Investor Relations Contacts

Rick Sowers
President and Chief Executive Officer
Private Bancorp of America, Inc., and CalPrivate Bank
(424) 303-4894

Cory Stewart
Executive Vice President and Chief Financial Officer
Private Bancorp of America, Inc., and CalPrivate Bank
(206) 293-3669

Safe Harbor Paragraph

This communication contains expressions of expectations, both implied and explicit, that are “forward-looking statements” within the meaning of such term in the Private Securities Litigation Reform Act of 1995. We caution you that a number of important factors could cause actual results to differ materially from those in the forward-looking statements, especially given the current turmoil in the banking and financial markets. These factors include the effects of depositors withdrawing funds unexpectedly, counterparties being unable to provide liquidity sources that we believe should be available, loan losses, economic conditions and competition in the geographic and business areas in which Private Bancorp of America, Inc. operates, including competition in lending and deposit acquisition, the unpredictability of fee income from participation in SBA loan programs, the effects of bank failures, liquidations and mergers in our markets and nationally, our ability to successfully integrate and develop business through the addition of new personnel, whether our efforts to expand loan, product and service offerings will prove profitable, system failures and data security, whether we can effectively secure and implement new technology solutions, inflation, fluctuations in interest rates, legislation and governmental regulation. You should not place undue reliance on forward-looking statements, and we undertake no obligation to update those statements whether as a result of changes in underlying factors, new information, future events or otherwise. These factors could cause actual results to differ materially from what we anticipate or project. You should not place undue reliance on any such forward-looking statement, which speaks only as of the date on which it was made. Although we in good faith believe the assumptions and bases supporting our forward-looking statements to be reasonable there can be no assurance that those assumptions and bases will prove accurate.

PRIVATE BANCORP OF AMERICA, INC. CONSOLIDATED BALANCE SHEET (Unaudited) (Dollars in thousands)

	Mar 31, 2024			Dec 31, 2023			Mar 31, 2023
Assets
Cash and due from banks	$	13,136		$	19,811		$	13,347
Interest-bearing deposits in other financial institutions		34,790			39,667			73,420
Interest-bearing deposits at Federal Reserve Bank		93,575			118,622			125,045
Total cash and due from banks		141,501			178,100			211,812
Interest-bearing time deposits with other institutions		4,032			4,000			7,661
Investment debt securities available for sale		114,067			102,499			103,790
Loans held for sale		383			1,233			465
Loans, net of deferred fees and costs and unaccreted discounts		1,906,992			1,847,161			1,623,028
Allowance for loan losses		(24,693	)		(24,476	)		(21,135	)
Loans held-for-investment, net of allowance		1,882,299			1,822,685			1,601,893
Federal Home Loan Bank stock, at cost		8,915			8,915			7,020
Right of use asset		2,765			3,096			2,889
Premises and equipment, net		1,804			1,700			1,744
Servicing assets, net		2,203			2,318			3,057
Accrued interest receivable		7,931			7,499			5,674
Other assets		21,877			20,423			20,623
Total assets	$	2,187,777		$	2,152,468		$	1,966,628

Liabilities and Shareholders' Equity
Liabilities
Noninterest bearing	$	516,294		$	572,755		$	639,664
Interest bearing		1,388,381			1,302,615			944,102
Total deposits		1,904,675			1,875,370			1,583,766
FHLB borrowings		53,000			57,000			192,000
Other borrowings		17,963			17,961			17,956
Accrued interest payable and other liabilities		18,107			16,354			20,592
Total liabilities		1,993,745			1,966,685			1,814,314

Shareholders' equity
Common stock		74,105			74,003			73,254
Additional paid-in capital		4,108			3,679			3,289
Retained earnings		124,464			116,604			84,751
Accumulated other comprehensive (loss) income, net		(8,645	)		(8,503	)		(8,980	)
Total shareholders' equity		194,032			185,783			152,314
Total liabilities and shareholders' equity	$	2,187,777		$	2,152,468		$	1,966,628

PRIVATE BANCORP OF AMERICA, INC. CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (Dollars in thousands, except per share amounts)

	For the three months ended
	Mar 31, 2024		Dec 31, 2023		Mar 31, 2023
Interest Income
Loans	$	33,006	$	31,482	$	26,228
Investment securities		979		655		580
Deposits in other financial institutions		1,799		1,926		1,150
Total interest income		35,784		34,063		27,958

Interest Expense
Deposits		12,130		10,874		4,924
Borrowings		886		1,001		866
Total interest expense		13,016		11,875		5,790

Net interest income		22,768		22,188		22,168
Provision (reversal) for credit losses		233		459		73
Net interest income after provision for credit losses		22,535		21,729		22,095

Noninterest income:
Service charges on deposit accounts		388		373		348
Net gain on sale of loans		681		436		474
Other noninterest income		357		435		643
Total noninterest income		1,426		1,244		1,465

Noninterest expense:
Compensation and employee benefits		8,861		7,942		8,030
Occupancy and equipment		770		790		806
Data processing		1,058		1,001		944
Professional services		488		410		438
Other expenses		1,606		1,625		1,339
Total noninterest expense		12,783		11,768		11,557
Income before provision for income taxes		11,178		11,205		12,003
Provision for income taxes		3,294		3,346		3,029
Net income	$	7,884	$	7,859	$	8,974
Net income available to common shareholders	$	7,832	$	7,800	$	8,923

Earnings per share
Basic earnings per share	$	1.38	$	1.38	$	1.59
Diluted earnings per share	$	1.36	$	1.36	$	1.57

Average shares outstanding		5,679,843		5,664,028		5,608,193
Diluted average shares outstanding		5,754,937		5,723,735		5,673,394

PRIVATE BANCORP OF AMERICA, INC. Consolidated average balance sheet, interest, yield and rates (Unaudited) (Dollars in thousands)

	For the three months ended
	Mar 31, 2024							Dec 31, 2023							Mar 31, 2023
	Average Balance		Interest		Average Yield/Rate			Average Balance		Interest		Average Yield/Rate			Average Balance		Interest		Average Yield/Rate
Interest-Earnings Assets
Deposits in other financial institutions	$	135,511	$	1,799		5.34	%	$	144,265	$	1,926		5.30	%	$	123,159	$	1,150		3.79	%
Investment securities		119,690		979		3.27	%		101,719		655		2.58	%		112,694		580		2.06	%
Loans, including LHFS		1,868,308		33,006		7.11	%		1,788,572		31,482		6.98	%		1,597,236		26,228		6.66	%
Total interest-earning assets		2,123,509		35,784		6.78	%		2,034,556		34,063		6.64	%		1,833,089		27,958		6.19	%
Noninterest-earning assets		25,469							27,930							24,905
Total Assets	$	2,148,978						$	2,062,486						$	1,857,994

Interest-Bearing Liabilities
Interest bearing DDA, excluding brokered		109,838		441		1.61	%		112,580		503		1.77	%		100,640		343		1.38	%
Savings & MMA, excluding brokered		765,770		6,421		3.37	%		713,754		5,811		3.23	%		619,316		2,378		1.56	%
Time deposits, excluding brokered		155,703		1,583		4.09	%		123,985		1,155		3.70	%		83,032		456		2.23	%
Total deposits, excluding brokered		1,031,311		8,445		3.29	%		950,319		7,469		3.12	%		802,988		3,177		1.60	%
Total brokered deposits		287,885		3,685		5.15	%		256,761		3,405		5.26	%		151,993		1,747		4.66	%
Total Interest-Bearing Deposits		1,319,196		12,130		3.70	%		1,207,080		10,874		3.57	%		954,981		4,924		2.09	%

FHLB advances		49,935		614		4.95	%		56,511		728		5.11	%		48,711		594		4.95	%
Other borrowings		17,962		272		6.09	%		17,960		273		6.03	%		17,976		272		6.14	%
Total Interest-Bearing Liabilities		1,387,093		13,016		3.77	%		1,281,551		11,875		3.68	%		1,021,668		5,790		2.30	%

Noninterest-bearing deposits		553,541							581,579							669,796
Total Funding Sources		1,940,634		13,016		2.70	%		1,863,130		11,875		2.53	%		1,691,464		5,790		1.39	%

Noninterest-bearing liabilities		18,018							19,069							19,752
Shareholders' equity		190,326							180,287							146,778

Total Liabilities and Shareholders' Equity	$	2,148,978						$	2,062,486						$	1,857,994

Net interest income/spread			$	22,768		4.08	%			$	22,188		4.11	%			$	22,168		4.80	%
Net interest margin						4.31	%						4.33	%						4.90	%

PRIVATE BANCORP OF AMERICA, INC. Condensed Balance Sheets (Unaudited) (Dollars in thousands, except per share amounts)

	Mar 31, 2024			Dec 31, 2023			Sep 30, 2023			Jun 30, 2023			Mar 31, 2023
Assets
Cash and due from banks	$	141,501		$	178,100		$	198,328		$	135,859		$	211,812
Interest-bearing time deposits with other institutions		4,032			4,000			1,500			7,661			7,661
Investment securities		114,067			102,499			86,648			94,574			103,790
Loans held for sale		383			1,233			4,071			1,982			465
Total loans held-for-investment		1,906,992			1,847,161			1,764,846			1,717,705			1,623,028
Allowance for loan losses		(24,693	)		(24,476	)		(23,789	)		(22,588	)		(21,135	)
Loans held-for-investment, net of allowance		1,882,299			1,822,685			1,741,057			1,695,117			1,601,893
Right of use asset		2,765			3,096			2,827			2,525			2,889
Premises and equipment, net		1,804			1,700			1,447			1,539			1,744
Other assets and interest receivable		40,926			39,155			38,341			37,480			36,374
Total assets	$	2,187,777		$	2,152,468		$	2,074,219		$	1,976,737		$	1,966,628

Liabilities and Shareholders' Equity
Liabilities
Noninterest Bearing	$	516,294		$	572,755		$	595,023		$	657,980		$	639,664
Interest Bearing		1,388,381			1,302,615			1,174,664			1,041,192			944,102
Total Deposits		1,904,675			1,875,370			1,769,687			1,699,172			1,583,766
Borrowings		70,963			74,961			99,959			83,958			209,956
Accrued interest payable and other liabilities		18,107			16,354			29,894			26,396			20,592
Total liabilities		1,993,745			1,966,685			1,899,540			1,809,526			1,814,314
Shareholders' equity
Common stock		74,105			74,003			73,416			73,379			73,254
Additional paid-in capital		4,108			3,679			3,584			3,405			3,289
Retained earnings		124,464			116,604			108,757			100,281			84,751
Accumulated other comprehensive (loss) income		(8,645	)		(8,503	)		(11,078	)		(9,854	)		(8,980	)
Total shareholders' equity		194,032			185,783			174,679			167,211			152,314
Total liabilities and shareholders' equity	$	2,187,777		$	2,152,468		$	2,074,219		$	1,976,737		$	1,966,628

Book value per common share	$	33.94		$	32.48		$	30.63		$	29.32		$	26.83
Tangible book value per common share ⁽¹⁾	$	33.55		$	32.08		$	30.20		$	28.82		$	26.30
Shares outstanding		5,717,519			5,719,115			5,703,350			5,702,637			5,676,017

(1) Non-GAAP measure. See GAAP to non-GAAP Reconciliation table.

PRIVATE BANCORP OF AMERICA, INC. Condensed Statements of Income (Unaudited) (Dollars in thousands, except per share amounts)

	For the three months ended
	Mar 31, 2024		Dec 31, 2023		Sep 30, 2023		Jun 30, 2023			Mar 31, 2023
Interest income	$	35,784	$	34,063	$	32,878	$	30,763		$	27,958
Interest expense		13,016		11,875		9,623		8,055			5,790
Net interest income		22,768		22,188		23,255		22,708			22,168
Provision (reversal) for credit losses		233		459		471		(7,149	)		73
Net interest income after provision for credit losses		22,535		21,729		22,784		29,857			22,095

Service charges on deposit accounts		388		373		313		310			348
Net gain on sale of loans		681		436		466		171			474
Other noninterest income		357		435		380		573			643
Total noninterest income		1,426		1,244		1,159		1,054			1,465

Compensation and employee benefits		8,861		7,942		7,512		7,189			8,030
Occupancy and equipment		770		790		781		795			806
Data processing		1,058		1,001		1,064		878			944
Professional services		488		410		564		(836	)		438
Other expenses		1,606		1,625		1,922		776			1,339
Total noninterest expense		12,783		11,768		11,843		8,802			11,557

Income before provision for income taxes		11,178		11,205		12,100		22,109			12,003
Income taxes		3,294		3,346		3,611		6,575			3,029
Net income	$	7,884	$	7,859	$	8,489	$	15,534		$	8,974
Net income available to common shareholders	$	7,832	$	7,800	$	8,422	$	15,407		$	8,923

Earnings per share
Basic earnings per share	$	1.38	$	1.38	$	1.49	$	2.72		$	1.59
Diluted earnings per share	$	1.36	$	1.36	$	1.47	$	2.69		$	1.57

Average shares outstanding		5,679,843		5,664,028		5,658,340		5,654,435			5,608,193
Diluted average shares outstanding		5,754,937		5,723,735		5,709,994		5,726,522			5,673,394

	Performance Ratios
	Mar 31, 2024			Dec 31, 2023			Sep 30, 2023			Jun 30, 2023			Mar 31, 2023
ROAA		1.48	%		1.51	%		1.68	%		3.18	%		1.96	%
ROAE		16.66	%		17.29	%		19.43	%		38.42	%		24.80	%
ROATCE ⁽¹⁾		16.86	%		17.53	%		19.74	%		39.14	%		25.32	%
Net interest margin		4.31	%		4.33	%		4.67	%		4.73	%		4.90	%
Net interest spread		4.08	%		4.11	%		4.48	%		4.58	%		4.80	%
Efficiency ratio ⁽¹⁾		52.84	%		50.22	%		48.51	%		37.04	%		48.90	%
Noninterest expense / average assets		2.39	%		2.26	%		2.34	%		1.80	%		2.52	%

(1) Non-GAAP measure. See GAAP to non-GAAP Reconciliation table.

PRIVATE BANCORP OF AMERICA, INC. (Unaudited)

	Selected Quarterly Average Balances
	(Dollars in thousands)
	For the three months ended
	Mar 31, 2024		Dec 31, 2023		Sep 30, 2023		Jun 30, 2023		Mar 31, 2023
Total assets	$	2,148,978	$	2,062,486	$	2,005,197	$	1,959,802	$	1,857,994
Earning assets	$	2,123,509	$	2,034,556	$	1,977,009	$	1,927,061	$	1,833,089
Total loans, including loans held for sale	$	1,868,308	$	1,788,572	$	1,745,113	$	1,675,790	$	1,597,236
Total deposits	$	1,872,737	$	1,788,659	$	1,698,892	$	1,656,540	$	1,624,777
Total shareholders' equity	$	190,326	$	180,287	$	173,347	$	162,173	$	146,778

	Loan Balances by Type
	(Dollars in thousands)
	Mar 31, 2024		Dec 31, 2023		Sep 30, 2023		Jun 30, 2023		Mar 31, 2023
Commercial Real Estate (CRE):
Investor owned	$	573,587	$	583,069	$	541,088	$	527,819	$	514,194
Owner occupied		216,123		202,106		185,296		177,177		178,511
Multifamily		175,629		168,324		159,700		158,082		151,262
Secured by single family		157,092		146,370		153,132		148,464		147,813
Land and construction		35,975		33,655		30,253		32,519		26,953
SBA secured by real estate		385,416		349,676		343,576		329,403		272,059
Total CRE		1,543,822		1,483,200		1,413,045		1,373,464		1,290,792
Commercial business:
Commercial and industrial		352,417		350,879		337,815		332,394		319,154
SBA non-real estate secured		8,657		9,807		11,081		9,121		10,591
Total commercial business		361,074		360,686		348,896		341,515		329,745
Consumer		2,096		3,275		2,905		2,726		2,491
Total loans held for investment	$	1,906,992	$	1,847,161	$	1,764,846	$	1,717,705	$	1,623,028

	Deposits by Type
	(Dollars in thousands)
	Mar 31, 2024		Dec 31, 2023		Sep 30, 2023		Jun 30, 2023		Mar 31, 2023
Noninterest-bearing DDA	$	516,294	$	572,755	$	595,023	$	657,980	$	639,664
Interest-bearing DDA, excluding brokered		117,129		121,829		108,508		101,064		99,988
Savings & MMA, excluding brokered		812,841		742,617		696,499		670,195		637,031
Time deposits, excluding brokered		160,605		147,583		122,622		105,757		77,052
Total deposits, excluding brokered		1,606,869		1,584,784		1,522,652		1,534,996		1,453,735
Total brokered deposits		297,806		290,586		247,035		164,176		130,031
Total deposits	$	1,904,675	$	1,875,370	$	1,769,687	$	1,699,172	$	1,583,766

PRIVATE BANCORP OF AMERICA, INC. (Unaudited)

	Rollforward of Allowance for Credit Losses
	(Dollars in thousands)
	For the three months ended
	Mar 31, 2024			Dec 31, 2023		Sep 30, 2023		Jun 30, 2023			Mar 31, 2023
Allowance for loan losses:
Beginning balance	$	24,476		$	23,789	$	22,588	$	21,135		$	19,152
Impact of CECL adoption		-			-		-		-			1,910
Provision for loan losses		251			687		1,194		(7,149	)		73
Net (charge-offs) recoveries		(34	)		-		7		8,602			-
Ending balance		24,693			24,476		23,789		22,588			21,135
Reserve for unfunded commitments ⁽¹⁾		1,723			1,741		1,969		2,172			2,802
Total allowance for credit losses	$	26,416		$	26,217	$	25,758	$	24,760		$	23,937

(1) Includes $974 thousand related to the impact of CECL adoption on January 1, 2023.

	Asset Quality
	(Dollars in thousands)
	Mar 31, 2024			Dec 31, 2023			Sep 30, 2023			Jun 30, 2023			Mar 31, 2023
Total loans held-for-investment	$	1,906,992		$	1,847,161		$	1,764,846		$	1,717,705		$	1,623,028
Allowance for loan losses	$	(24,693	)	$	(24,476	)	$	(23,789	)	$	(22,588	)	$	(21,135	)
30-89 day past due loans	$	-		$	1,470		$	2,500		$	-		$	-
90+ day past due loans	$	3,530		$	3,874		$	1,374		$	3,701		$	3,058
Nonaccrual loans	$	4,656		$	5,053		$	5,105		$	3,354		$	4,384
NPAs / Assets		0.21	%		0.23	%		0.25	%		0.17	%		0.22	%
NPLs / Total loans held-for-investment & OREO		0.24	%		0.27	%		0.29	%		0.20	%		0.27	%
Net quarterly charge-offs (recoveries)	$	34		$	-		$	(7	)	$	(8,602	)	$	-
Net charge-offs (recoveries) /avg loans (annualized)		0.01	%		0.00	%		0.00	%		(2.05	)%		0.00	%
Allowance for loan losses to loans HFI		1.29	%		1.33	%		1.35	%		1.32	%		1.30	%
Allowance for loan losses to nonaccrual loans		530.35	%		484.39	%		465.99	%		673.46	%		482.09	%

PRIVATE BANCORP OF AMERICA, INC. (Unaudited)

The following tables present a reconciliation of non-GAAP financial measures to GAAP measures for: adjusted income before provision for income taxes, adjusted net income and adjusted EPS. We believe the presentation of certain non-GAAP financial measures provides useful information to assess our consolidated financial condition and consolidated results of operations and to assist investors in evaluating our financial results relative to our peers. These non-GAAP financial measures complement our GAAP reporting and are presented below to provide investors and others with information that we use to manage the business each period. Because not all companies use identical calculations, the presentation of these non-GAAP financial measures may not be comparable to other similarly titled measures used by other companies. These non-GAAP measures should be taken together with the corresponding GAAP measures and should not be considered a substitute of the GAAP measures.

	GAAP to Non-GAAP Reconciliation
	(Dollars in thousands, except per share amounts)

		For the three months ended
		Mar 31, 2024		Dec 31, 2023		Sep 30, 2023		Jun 30, 2023			Mar 31, 2023
Adjusted income before provision for income taxes
Income before provision for income taxes		$	11,178	$	11,205	$	12,100	$	22,109		$	12,003
ANI recovery ⁽¹⁾			-		-		-		(7,708	)		-
Settlement of legal fees related to ANI litigation ⁽²⁾			-		-		-		(1,635	)		-
Recovery of principal and interest on a loan acquired with credit deterioration as part of a business combination ⁽³⁾			-		-		-		(986	)		-
Adjusted income before provision for income taxes (non-GAAP)		$	11,178	$	11,205	$	12,100	$	11,780		$	12,003

Adjusted net income
Net income		$	7,884	$	7,859	$	8,489	$	15,534		$	8,974
ANI recovery, net of tax ⁽¹⁾⁽⁴⁾			-		-		-		(5,430	)		-
Settlement of legal fees related to ANI litigation, net of tax ⁽²⁾⁽⁴⁾			-		-		-		(1,152	)		-
Recovery of principal and interest on a loan acquired with credit deterioration as part of a business combination, net of tax⁽³⁾⁽⁴⁾			-		-		-		(694	)		-
Adjusted net income (non-GAAP)		$	7,884	$	7,859	$	8,489	$	8,258		$	8,974

Adjusted diluted earnings per share ("Adjusted EPS")
Diluted earnings per share		$	1.36	$	1.36	$	1.47	$	2.69		$	1.57
ANI recovery, net of tax ⁽¹⁾⁽⁴⁾			-		-		-		(0.94	)		-
Settlement of legal fees related to ANI litigation, net of tax ⁽²⁾⁽⁴⁾			-		-		-		(0.20	)		-
Recovery of principal and interest on a loan previously acquired with credit deterioration as part of a business combination, net of tax⁽³⁾⁽⁴⁾			-		-		-		(0.12	)		-
Adjusted EPS (non-GAAP)		$	1.36	$	1.36	$	1.47	$	1.43		$	1.57

Diluted average shares outstanding			5,754,937		5,723,735		5,709,994		5,726,522			5,673,394

(1) In the second quarter of 2023, the Company reached a settlement with the Receiver for ANI Investments and Gina Champion-Cain in which the Company recovered $7.7 million (or approximately $0.94 per diluted share after tax) plus certain rights to future recoveries from a guarantor of the charged off loan. This recovery amount represents 80% of the original principal charge-off and is net of the participant bank’s share.
(2) In the second quarter of 2023, in conjunction with the resolution of the ANI litigation, the Company was reimbursed $0.9 million of legal costs by the participant bank. In addition, $0.7 million of previously invoiced legal fees were waived at settlement of the litigation.
(3) In the second quarter of 2023, the Company received $1.0 million related to a loan that was originated and written off by San Diego Private Bank ("SDPB") prior to SDPB merging with the Company in 2013. Accordingly, the Company recorded an allowance recovery of $0.9 million for the amount that would have been written off at the time of the merger under CECL and $0.1 million of interest income for recovered interest.
(4) Net of tax effect of 29.6%, which is comprised of 21.0% for the statutory Federal tax rate plus 8.6% for state franchise taxes, net of Federal benefits.

PRIVATE BANCORP OF AMERICA, INC. (Unaudited)

The following tables present a reconciliation of non-GAAP financial measures to GAAP measures for: efficiency ratio, adjusted efficiency ratio, pretax pre-provision net revenue, average tangible common equity, adjusted return on average assets, return on average tangible common equity and adjusted return on average tangible common equity. We believe the presentation of certain non-GAAP financial measures provides useful information to assess our consolidated financial condition and consolidated results of operations and to assist investors in evaluating our financial results relative to our peers. These non-GAAP financial measures complement our GAAP reporting and are presented below to provide investors and others with information that we use to manage the business each period. Because not all companies use identical calculations, the presentation of these non-GAAP financial measures may not be comparable to other similarly titled measures used by other companies. These non-GAAP measures should be taken together with the corresponding GAAP measures and should not be considered a substitute of the GAAP measures.

	GAAP to Non-GAAP Reconciliation
	(Dollars in thousands)

	For the three months ended
	Mar 31, 2024			Dec 31, 2023			Sep 30, 2023			Jun 30, 2023			Mar 31, 2023
Efficiency Ratio
Noninterest expense	$	12,783		$	11,768		$	11,843		$	8,802		$	11,557
Net interest income		22,768			22,188			23,255			22,708			22,168
Noninterest income		1,426			1,244			1,159			1,054			1,465
Total net interest income and noninterest income		24,194			23,432			24,414			23,762			23,633
Efficiency ratio (non-GAAP)		52.84	%		50.22	%		48.51	%		37.04	%		48.90	%

Adjusted Efficiency Ratio
Noninterest expense	$	12,783		$	11,768		$	11,843		$	8,802		$	11,557
Settlement of legal fees related to ANI litigation		-			-			-			1,635			-
Adjusted noninterest expense (non-GAAP)		12,783			11,768			11,843			10,437			11,557
Total net interest income and noninterest income		24,194			23,432			24,414			23,762			23,633
Recovery of interest on a loan acquired with credit deterioration as part of a business combination		-			-			-			(84	)		-
Adjusted total net interest income and noninterest income (non-GAAP)		24,194			23,432			24,414			23,678			23,633
Adjusted Efficiency ratio (non-GAAP)		52.84	%		50.22	%		48.51	%		44.08	%		48.90	%

Pretax pre-provision net revenue
Net interest income	$	22,768		$	22,188		$	23,255		$	22,708		$	22,168
Noninterest income		1,426			1,244			1,159			1,054			1,465
Total net interest income and noninterest income		24,194			23,432			24,414			23,762			23,633
Less: Noninterest expense		12,783			11,768			11,843			8,802			11,557
Pretax pre-provision net revenue (non-GAAP)	$	11,411		$	11,664		$	12,571		$	14,960		$	12,076

Return and Adjusted Return on Average Assets, Average Equity, Average Tangible Equity
Net income	$	7,884		$	7,859		$	8,489		$	15,534		$	8,974
Adjusted net income (non-GAAP) ⁽¹⁾		7,884			7,859			8,489			8,258			8,974
Average assets		2,148,978			2,062,486			2,005,197			1,959,802			1,857,994
Average shareholders' equity		190,326			180,287			173,347			162,173			146,778
Less: Average intangible assets		2,208			2,451			2,709			2,975			3,026
Average tangible common equity (non-GAAP)		188,118			177,836			170,638			159,198			143,752

Return on average assets		1.48	%		1.51	%		1.68	%		3.18	%		1.96	%
Adjusted return on average assets (non-GAAP) ⁽¹⁾		1.48	%		1.51	%		1.68	%		1.69	%		1.96	%
Return on average equity		16.66	%		17.29	%		19.43	%		38.42	%		24.80	%
Adjusted return on average equity (non-GAAP) ⁽¹⁾		16.66	%		17.29	%		19.43	%		20.42	%		24.80	%
Return on average tangible common equity (non-GAAP)		16.86	%		17.53	%		19.74	%		39.14	%		25.32	%
Adjusted return on average tangible common equity (non-GAAP) ⁽¹⁾		16.86	%		17.53	%		19.74	%		20.81	%		25.32	%

Tangible book value per share
Total equity		194,032			185,783			174,679			167,211			152,314
Less: Total intangible assets		2,203			2,318			2,449			2,875			3,057
Total tangible equity		191,829			183,465			172,230			164,336			149,257
Shares outstanding		5,717,519			5,719,115			5,703,350			5,702,637			5,676,017
Tangible book value per share (non-GAAP)	$	33.55		$	32.08		$	30.20		$	28.82		$	26.30