Private Bancorp of America, Inc. Announces Record Net Income and Earnings Per Share for Full Year 2023 with Total Assets of $2.2 Billion


 Fourth Quarter 2023 Highlights

  • Net income for the fourth quarter of 2023 of $7.9 million, compared to $8.5 million in the prior quarter and up from $7.4 million in the fourth quarter of 2022. Net income for the fourth quarter of 2023 represents a return on average assets of 1.51% and a return on average tangible common equity of 17.53%
  • Diluted earnings per share for the fourth quarter of 2023 of $1.36, compared to $1.47 in the prior quarter and $1.31 in the fourth quarter of 2022
  • Loans held-for-investment (“HFI”) totaled $1.85 billion as of December 31, 2023, an increase of $82.3 million or 4.7% from September 30, 2023
  • Provision for credit losses for the fourth quarter of 2023 was $0.5 million, compared to $0.5 million for the prior quarter and $0.1 million for the fourth quarter of 2022
  • Total deposits were $1.88 billion as of December 31, 2023, an increase of $105.7 million or 6.0% from September 30, 2023. Federal Home Loan Bank advances decreased by $25.0 million as a consequence of deposit growth. Core deposits were $1.58 billion as of December 31, 2023, an increase of $62.1 million or 4.1% from September 30, 2023
  • As of December 31, 2023, total available liquidity was $1.6 billion or 172% of uninsured deposits, net of collateralized and fiduciary deposit accounts. Total available liquidity is comprised of $272 million of on-balance sheet liquidity (cash and investment securities) and $1.3 billion of unused borrowing capacity
  • Net interest margin was 4.33% for the fourth quarter of 2023, as compared to 4.67% for the prior quarter and 5.17% for the fourth quarter of 2022
  • Total cost of deposits was 2.41% for the fourth quarter of 2023, an increase from 1.92% for the prior quarter and 0.79% in the fourth quarter of 2022
  • The spot rate for total deposits was 2.49% as of December 31, 2023, compared to 2.18% at September 30, 2023. Total cost of funding sources was 2.53% for the fourth quarter of 2023, an increase from 2.12% in the prior quarter and 0.86% in the fourth quarter of 2022
  • Tangible book value per share was $32.08 as of December 31, 2023, an increase of $1.88 since September 30, 2023 as a result of strong earnings and a decrease in net unrealized losses on the available-for-sale investment securities portfolio. Tangible book value per share increased 6.2% quarter-over-quarter

2023 Full Year and Period End Highlights

  • Record net income of $40.9 million (GAAP basis), or $33.6 million(1) (as adjusted), for FY'23, up from $24.7 million in FY'22. Net income for 2023 represents a return on average assets of 1.70%(1) (as adjusted) and a return on average tangible common equity of 20.60%(1) (as adjusted)
  • Record diluted earnings per share of $7.11 (GAAP basis), or $5.85(1) (as adjusted), for FY'23, up from $4.33 in FY'22
  • Loans held-for-investment (“HFI”) totaled $1.85 billion as of December 31, 2023, an increase of $258.9 million or 16.3% from December 31, 2022
  • Provision for credit losses was a net reversal of $6.1 million for FY'23, compared to a provision of $2.2 million in FY'22. The net reversal for FY'23 reflects recoveries of $8.6 million, which includes $7.7 million for the settlement of a lawsuit against ANI Development, LLC/Gina Champion-Cain and Chicago Title (parent company, Fidelity National Financial) related to a previously charged-off loan, as well as a recovery of $902 thousand for a loan that was acquired as part of a merger in 2013
  • Total deposits were $1.88 billion as of December 31, 2023, an increase of $200.2 million or 12.0% from December 31, 2022. Federal Home Loan Bank advances increased by $57.0 million as a consequence of funding loan growth. Core deposits were $1.58 billion as of December 31, 2023, an increase of $114.4 million or 7.8% from December 31, 2022
  • Net interest margin was 4.65% for FY'23, as compared to 4.87% in FY'22
  • Total cost of deposits was 1.81% for FY'23, an increase from 0.34% in FY'22. The spot rate for total deposits was 2.49% as of December 31, 2023, compared to 2.18% at December 31, 2022. Total cost of funding sources was 1.98% for FY'23, an increase from 0.42% in FY'22
  • Tangible book value per share was $32.08 as of December 31, 2023, an increase of $7.02 since December 31, 2022 as a result of strong earnings and a decrease in net unrealized losses on the available-for-sale investment securities portfolio. Tangible book value per share increased 28.0% year-over-year

LA JOLLA, Calif., Jan. 19, 2024 (GLOBE NEWSWIRE) -- Private Bancorp of America, Inc. (OTCQX:PBAM), (“Company”) and CalPrivate Bank (“Bank”) announced unaudited financial results for the fourth fiscal quarter ended December 31, 2023. The Company reported net income of $7.9 million, or $1.36 per diluted share, for the fourth quarter of 2023, which represents a 5.6% increase from $7.4 million, or $1.31 per diluted share, for the fourth quarter of 2022. For the fiscal year ended December 31, 2023, the Company reported record net income of $40.9 million (GAAP basis), or $33.6 million(1) (as adjusted), and record diluted earnings per share of $7.11 (GAAP basis), or $5.85(1) (as adjusted).

Rick Sowers, President and CEO of the Company and the Bank stated, “I am extremely proud of the accomplishments our Team achieved in 2023. Record earnings for yet another year in 2023, despite a challenging environment, is a testament to how CalPrivate Bank continues to build Relationships and provide valued Solutions to Clients. We are very pleased with achieving loan growth of 16% in 2023 while many other banks backed away from lending in their communities. Competition for deposits remains intense so we are focused on providing exceptional service and being a Trusted partner to our Clients.”

Sowers added, “The market disruptions during 2023 have provided an opportunity for CalPrivate Bank to hire exceptional talent and leverage our Distinctly Different Service model to serve the needs of our communities. Credit trends remain solid and we continue to diligently perform portfolio management activities to anticipate and prepare for changes in economic and interest rate conditions. Our goal remains to stay attuned to the market and enhance shareholder value.”

“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.

(1) A reconciliation of net income to adjusted net income and diluted earnings per share to adjusted earnings per share is provided on page 15.

STATEMENT OF INCOME

Net Interest Income

Net interest income for the fourth quarter of 2023 totaled $22.2 million, a decrease of $1.1 million or 4.6% from the prior quarter and a decrease of $0.4 million or 1.8% from the fourth quarter of 2022. The decrease from the prior quarter was driven primarily by margin compression as interest expense increased by $2.3 million, which resulted primarily from a 44 basis point increase in the cost of interest-bearing liabilities. Partially offsetting this was an increase of $1.2 million in interest income, which resulted from a 2.9% increase in average earning assets and 4 basis point increase in yield on earning assets.

Net Interest Margin

Net interest margin for the fourth quarter of 2023 was 4.33%, compared to 4.67% for the prior quarter and 5.17% in the fourth quarter of 2022. The 34 basis point decrease in net interest margin from the prior quarter was due primarily to higher rates paid on deposits and other funding sources, partially offset by higher rates on new loan originations and variable rate loans and investment securities. The yield on earning assets was 6.64% for the fourth quarter of 2023 compared to 6.60% for the prior quarter, and the cost of interest-bearing liabilities was 3.68% for the fourth quarter of 2023 compared to 3.24% in the prior quarter. The cost of total deposits was 2.41% for the fourth quarter of 2023 compared to 1.92% in the prior quarter. The cost of core deposits, which excludes brokered deposits, was 1.93% in the fourth quarter of 2023 compared to 1.48% in the prior quarter.

Provision for Credit Losses

Provision expense for credit losses for the fourth quarter of 2023 was $0.5 million, compared to $0.5 million in the prior quarter and provision expense of $0.1 million for the fourth quarter of 2022. For more details, please refer to the “Asset Quality” section below.

Noninterest Income

Noninterest income was $1.2 million for the fourth quarter of 2023, compared to $1.2 million in the prior quarter and $1.1 million in the fourth quarter of 2022. SBA loan sales for the fourth quarter of 2023 were $6.7 million with a 9.62% average trade premium resulting in a net gain on sale of $436 thousand, compared with $7.2 million with a 9.47% average trade premium resulting in a net gain on sale of $466 thousand in the prior quarter. Management expects continued softness in the market for SBA 7a loans.

Noninterest Expense

Noninterest expense was $11.8 million for the fourth quarter of 2023, compared to $11.8 million in the prior quarter and $13.1 million in the fourth quarter of 2022. Compensation and employee benefits expense increased $430 thousand compared to the prior quarter driven by increased headcount and adjustments to share-based compensation. Other expenses declined by $297 thousand due primarily to the reclassification adjustment recorded in the prior quarter for the reversal of reserve for unfunded commitments which was previously presented as other expenses and is now recorded in the provision (reversal) for credit losses line of the income statement. The efficiency ratio was 50.22% for the fourth quarter of 2023 compared to 48.51% in the prior quarter and 55.22% in the fourth quarter of 2022. The increase in the efficiency ratio from the prior quarter was due primarily to the aforementioned decrease in net interest income.

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 fourth quarter of 2023, compared to $3.6 million for the prior quarter. The effective tax rate for the fourth quarter of 2023 was 29.9%, compared to 29.8% in the prior quarter and 29.4% in the fourth quarter of 2022.

STATEMENT OF FINANCIAL CONDITION

As of December 31, 2023, total assets were $2.15 billion, an increase of $78.2 million since the prior quarter and $297.6 million since December 31, 2022. The increase in assets from the prior quarter was primarily due to higher loans receivable and investment securities, partially offset by lower cash balances. Total cash and due from banks was $178.1 million as of December 31, 2023, a decrease of $20.2 million or 10.2%, since September 30, 2023, primarily due to the timing of the settlement of $52 million of brokered certificates of deposit obtained at the end of September 2023 and subsequently used to pay off Federal Home Loan Bank Advances in early October 2023. Loans HFI totaled $1.85 billion as of December 31, 2023, an increase of $82.3 million or 4.7% since September 30, 2023. Investment securities available for sale (“AFS”) were $102.5 million as of December 31, 2023, an increase of $15.9 million, or 18.3% since September 30, 2023 as a result of new securities purchased and lower net unrealized losses. As of December 31, 2023, the net unrealized loss on the AFS investment securities portfolio, which is comprised mostly of US Treasury and Government Agency debt, was $12.1 million (pre-tax) compared to a loss of $15.8 million as of September 30, 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 $1.88 billion as of December 31, 2023, an increase of $105.7 million since September 30, 2023. During the quarter, core deposits increased by $62.1 million, which was driven by an $84.4 million increase in interest-bearing core deposits (including balances in the IntraFi ICS and CDARS programs), partially offset by a $22.3 million decrease in noninterest-bearing core deposits. A portion of the increase in core deposits is seasonal in nature due to end of year client activities. Noninterest-bearing deposits represent 36.1% of total core deposits. Uninsured deposits, net of collateralized and fiduciary deposit accounts, represent 48.0% of total deposits as of December 31, 2023.

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

As of December 31, 2023, the allowance for loan losses was $24.5 million or 1.33% of loans HFI, compared to 1.35% as of September 30, 2023 and 1.21% at December 31, 2022. The increase in the coverage ratio from December 31, 2022 primarily resulted from the adoption of CECL. The Company continues to have strong credit metrics and its nonperforming assets are 0.23% of total assets as of December 31, 2023. The reserve for unfunded commitments was $1.7 million as of December 31, 2023, compared to $2.0 million as of September 30, 2023 and the change was due to a decrease in commitment balances available. Given the credit quality of the loan portfolio, management believes we are sufficiently reserved.

At both December 31, 2023 and September 30, 2023, there are no doubtful credits and classified assets were $11.0 million. Total classified assets consisted of 9 loans as of December 31, 2023, which included 6 loans totaling $7.1 million secured by real estate with a weighted average LTV of 58.5%. The remaining 3 loans were commercial and industrial loans, two of which were SBA loans with a balance of $1.4 million, which includes one loan that is 75% guaranteed and one loan that is 90% guaranteed by the SBA, and the third was a $2.5 million unsecured loan with a specific reserve of $1.25 million.

Capital Ratios (2)

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

 December 31, 2023 (2)September 30, 2023
CalPrivate Bank  
Tier I leverage ratio10.07%9.98%
Tier I risk-based capital ratio11.02%11.03%
Total risk-based capital ratio12.27%12.28%

(2) December 31, 2023 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)
 Dec 31, 2023
 Sep 30, 2023
 Dec 31, 2022
Assets        
Cash and due from banks$19,811  $20,013  $14,495 
Interest-bearing deposits in other financial institutions 39,667   20,508   30,409 
Interest-bearing deposits at Federal Reserve Bank 118,622   157,807   83,738 
Total cash and due from banks 178,100   198,328   128,642 
Interest-bearing time deposits with other institutions 4,000   1,500   7,923 
Investment debt securities available for sale 102,499   86,648   104,652 
Loans held for sale 1,233   4,071   7,061 
Loans, net of deferred fees and costs and unaccreted discounts 1,847,161   1,764,846   1,588,248 
Allowance for loan losses (24,476)  (23,789)  (19,152)
Loans held-for-investment, net of allowance 1,822,685   1,741,057   1,569,096 
Federal Home Loan Bank stock, at cost 8,915   8,915   7,020 
Right of use asset 3,096   2,827   3,265 
Premises and equipment, net 1,700   1,447   1,742 
Servicing assets, net 2,318   2,449   3,007 
Accrued interest receivable 7,499   6,877   5,291 
Other assets 20,423   20,100   17,181 
Total assets$2,152,468  $2,074,219  $1,854,880 
         
Liabilities and Shareholders' Equity        
Liabilities        
Noninterest bearing$572,755  $595,023  $691,392 
Interest bearing 1,302,615   1,174,664   983,730 
Total deposits 1,875,370   1,769,687   1,675,122 
FHLB borrowings 57,000   82,000   - 
Other borrowings 17,961   17,959   17,954 
Accrued interest payable and other liabilities 16,354   29,894   18,480 
Total liabilities 1,966,685   1,899,540   1,711,556 
         
Shareholders' equity        
Common stock 74,003   73,416   72,221 
Additional paid-in capital 3,679   3,584   3,353 
Retained earnings 116,604   108,757   77,810 
Accumulated other comprehensive (loss) income, net (8,503)  (11,078)  (10,060)
Total shareholders' equity 185,783   174,679   143,324 
Total liabilities and shareholders' equity$2,152,468  $2,074,219  $1,854,880 



PRIVATE BANCORP OF AMERICA, INC.
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(Dollars in thousands, except per share amounts)
 For the three months ended
 Year to Date
 Dec 31, 2023
 Sep 30, 2023
 Dec 31, 2022
 Dec 31, 2023
 Dec 31, 2022
Interest Income          
Loans$31,482 $30,568 $24,717 $116,548  $80,922
Investment securities 655  562  592  2,357   2,143
Deposits in other financial institutions 1,926  1,748  756  6,757   1,467
Total interest income 34,063  32,878  26,065  125,662   84,532
           
Interest Expense          
Deposits 10,874  8,210  3,149  30,589   4,897
Borrowings 1,001  1,413  320  4,754   1,311
Total interest expense 11,875  9,623  3,469  35,343   6,208
           
Net interest income 22,188  23,255  22,596  90,319   78,324
Provision (reversal) for credit losses 459  471  60  (6,146)  2,178
Net interest income after provision for credit losses 21,729  22,784  22,536  96,465   76,146
           
Noninterest income:          
Service charges on deposit accounts 373  313  274  1,344   1,160
Net gain on sale of loans 436  466  792  1,547   4,678
Other noninterest income 435  380  18  2,031   1,202
Total noninterest income 1,244  1,159  1,084  4,922   7,040
           
Noninterest expense:          
Compensation and employee benefits 7,942  7,512  8,482  30,673   30,430
Occupancy and equipment 790  781  820  3,172   3,107
Data processing 1,001  1,064  942  3,887   3,411
Professional services 410  564  1,018  576   5,261
Other expenses 1,625  1,922  1,813  5,662   6,035
Total noninterest expense 11,768  11,843  13,075  43,970   48,244
Income before provision for income taxes 11,205  12,100  10,545  57,417   34,942
Provision for income taxes 3,346  3,611  3,102  16,561   10,233
Net income$7,859 $8,489 $7,443 $40,856  $24,709
Net income available to common shareholders$7,800 $8,422 $7,394 $40,563  $24,495
           
Earnings per share          
Basic earnings per share$1.38 $1.49 $1.33 $7.18  $4.41
Diluted earnings per share$1.36 $1.47 $1.31 $7.11  $4.33
           
Average shares outstanding 5,664,028  5,658,340  5,551,376  5,646,409   5,555,495
Diluted average shares outstanding 5,723,735  5,709,994  5,645,355  5,704,519   5,652,571



PRIVATE BANCORP OF AMERICA, INC.
Consolidated average balance sheet, interest, yield and rates
(Unaudited)
(Dollars in thousands)
 For the three months ended
 Dec 31, 2023
 Sep 30, 2023
 Dec 31, 2022
 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$144,265 $1,926 5.30% $130,583 $1,748 5.31% $91,324 $756 3.28%
Investment securities 101,719  655 2.58%  101,313  562 2.22%  114,390  592 2.07%
Loans, including LHFS 1,788,572  31,482 6.98%  1,745,113  30,568 6.95%  1,527,863  24,717 6.42%
Total interest-earning assets 2,034,556  34,063 6.64%  1,977,009  32,878 6.60%  1,733,577  26,065 5.97%
Noninterest-earning assets 27,930       28,188       25,627     
Total Assets$2,062,486      $2,005,197      $1,759,204     
                     
Interest-Bearing Liabilities                    
Interest bearing DDA, excluding brokered 112,580  503 1.77%  99,243  402 1.61%  98,504  295 1.19%
Savings & MMA, excluding brokered 713,754  5,811 3.23%  657,453  4,248 2.56%  592,707  1,551 1.04%
Time deposits, excluding brokered 123,985  1,155 3.70%  114,437  933 3.23%  72,040  265 1.46%
Total deposits, excluding brokered 950,319  7,469 3.12%  871,133  5,583 2.54%  763,251  2,111 1.10%
Total brokered deposits 256,761  3,405 5.26%  202,644  2,627 5.14%  90,095  1,038 4.57%
Total Interest-Bearing Deposits 1,207,080  10,874 3.57%  1,073,777  8,210 3.03%  853,346  3,149 1.46%
                     
FHLB advances 56,511  728 5.11%  87,190  1,142 5.20%  12,195  112 3.64%
Other borrowings 17,960  273 6.03%  17,958  271 5.99%  18,063  208 4.57%
Total Interest-Bearing Liabilities 1,281,551  11,875 3.68%  1,178,925  9,623 3.24%  883,604  3,469 1.56%
                     
Noninterest-bearing deposits 581,579       625,115       720,656     
Total Funding Sources 1,863,130  11,875 2.53%  1,804,040  9,623 2.12%  1,604,260  3,469 0.86%
                     
Noninterest-bearing liabilities 19,069       27,810       13,614     
Shareholders' equity 180,287       173,347       141,330     
                     
Total Liabilities and Shareholders' Equity$2,062,486      $2,005,197      $1,759,204     
                     
Net interest income/spread  $22,188 4.11%   $23,255 4.48%   $22,596 5.11%
Net interest margin    4.33%     4.67%     5.17%



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

 Year to Date 
 Dec 31, 2023
 Dec 31, 2022
 Average
Balance
 Interest Average
Yield/Rate
 Average
Balance
 Interest Average
Yield/Rate
Interest-Earnings Assets:             
Deposits in other financial institutions$134,783 $6,757 5.01% $96,277 $1,467 1.52%
Investment securities 106,470  2,357 2.21%  117,870  2,143 1.82%
Loans 1,702,321  116,548 6.85%  1,394,369  80,922 5.80%
Total interest-earning assets 1,943,574  125,662 6.47%  1,608,516  84,532 5.26%
Noninterest-earning assets 28,442       25,719     
Total Assets$1,972,016      $1,634,235     
              
Interest-Bearing Liabilities             
Interest bearing DDA, excluding brokered 102,972  1,612 1.57%  89,442  530 0.59%
Savings & MMA, excluding brokered 659,191  16,007 2.43%  529,108  2,555 0.48%
Time deposits, excluding brokered 105,810  3,263 3.08%  69,154  636 0.92%
Total deposits, excluding brokered 867,973  20,882 2.41%  687,704  3,721 0.54%
Total brokered deposits 192,060  9,707 5.05%  34,200  1,176 3.44%
Total Interest-Bearing Deposits 1,060,033  30,589 2.89%  721,904  4,897 0.68%
              
FHLB advances 72,322  3,666 5.07%  11,889  288 2.42%
Other borrowings 17,966  1,088 6.06%  17,978  1,023 5.69%
Total Interest-Bearing Liabilities 1,150,321  35,343 3.07%  751,771  6,208 0.83%
              
Noninterest-bearing deposits 632,652       733,313     
Total Funding Sources 1,782,973  35,343 1.98%  1,485,084  6,208 0.42%
              
Noninterest-bearing liabilities 23,294       13,120     
Shareholders' equity 165,749       136,031     
              
Total Liabilities and Shareholders' Equity$1,972,016      $1,634,235     
              
Net interest income/spread  $90,319 4.49%   $78,324 4.84%
Net interest margin    4.65%     4.87%



PRIVATE BANCORP OF AMERICA, INC.
Condensed Balance Sheets
(Unaudited)
(Dollars in thousands, except per share amounts)
 Dec 31, 2023
 Sep 30, 2023
 Jun 30, 2023
 Mar 31, 2023
 Dec 31, 2022
Assets              
Cash and due from banks$178,100  $198,328  $135,859  $211,812  $128,642 
Interest-bearing time deposits with other institutions 4,000   1,500   7,661   7,661   7,923 
Investment securities 102,499   86,648   94,574   103,790   104,652 
Loans held for sale 1,233   4,071   1,982   465   7,061 
Total loans held-for-investment 1,847,161   1,764,846   1,717,705   1,623,028   1,588,248 
Allowance for loan losses (24,476)  (23,789)  (22,588)  (21,135)  (19,152)
Loans held-for-investment, net of allowance 1,822,685   1,741,057   1,695,117   1,601,893   1,569,096 
Right of use asset 3,096   2,827   2,525   2,889   3,265 
Premises and equipment, net 1,700   1,447   1,539   1,744   1,742 
Other assets and interest receivable 39,155   38,341   37,480   36,374   32,499 
Total assets$2,152,468  $2,074,219  $1,976,737  $1,966,628  $1,854,880 
               
Liabilities and Shareholders' Equity              
Liabilities              
Noninterest Bearing$572,755  $595,023  $657,980  $639,664  $691,392 
Interest Bearing 1,302,615   1,174,664   1,041,192   944,102   983,730 
Total Deposits 1,875,370   1,769,687   1,699,172   1,583,766   1,675,122 
Borrowings 74,961   99,959   83,958   209,956   17,954 
Accrued interest payable and other liabilities 16,354   29,894   26,396   20,592   18,480 
Total liabilities 1,966,685   1,899,540   1,809,526   1,814,314   1,711,556 
Shareholders' equity              
Common stock 74,003   73,416   73,379   73,254   72,221 
Additional paid-in capital 3,679   3,584   3,405   3,289   3,353 
Retained earnings 116,604   108,757   100,281   84,751   77,810 
Accumulated other comprehensive (loss) income (8,503)  (11,078)  (9,854)  (8,980)  (10,060)
Total shareholders' equity 185,783   174,679   167,211   152,314   143,324 
Total liabilities and shareholders' equity$2,152,468  $2,074,219  $1,976,737  $1,966,628  $1,854,880 
               
Book value per common share$32.48  $30.63  $29.32  $26.83  $25.60 
Tangible book value per common share (1)$32.08  $30.20  $28.82  $26.30  $25.06 
Shares outstanding 5,719,115   5,703,350   5,702,637   5,676,017   5,599,025 

(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
 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023
 Mar 31, 2023 Dec 31, 2022
Interest income$34,063 $32,878 $30,763  $27,958 $26,065
Interest expense 11,875  9,623  8,055   5,790  3,469
Net interest income 22,188  23,255  22,708   22,168  22,596
Provision (reversal) for credit losses 459  471  (7,149)  73  60
Net interest income after provision for credit losses 21,729  22,784  29,857   22,095  22,536
           
Service charges on deposit accounts 373  313  310   348  274
Net gain on sale of loans 436  466  171   474  792
Other noninterest income 435  380  573   643  18
Total noninterest income 1,244  1,159  1,054   1,465  1,084
           
Compensation and employee benefits 7,942  7,512  7,189   8,030  8,482
Occupancy and equipment 790  781  795   806  820
Data processing 1,001  1,064  878   944  942
Professional services 410  564  (836)  438  1,018
Other expenses 1,625  1,922  776   1,339  1,813
Total noninterest expense 11,768  11,843  8,802   11,557  13,075
           
Income before provision for income taxes 11,205  12,100  22,109   12,003  10,545
Income taxes 3,346  3,611  6,575   3,029  3,102
Net income$7,859 $8,489 $15,534  $8,974 $7,443
Net income available to common shareholders$7,800 $8,422 $15,407  $8,923 $7,394
           
Earnings per share          
Basic earnings per share$1.38 $1.49 $2.72  $1.59 $1.33
Diluted earnings per share$1.36 $1.47 $2.69  $1.57 $1.31
           
Average shares outstanding 5,664,028  5,658,340  5,654,435   5,608,193  5,551,376
Diluted average shares outstanding 5,723,735  5,709,994  5,726,522   5,673,394  5,645,355



 Performance Ratios
 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022
ROAA1.51% 1.68% 3.18% 1.96% 1.68%
ROAE17.29% 19.43% 38.42% 24.80% 20.89%
ROATCE (1)17.53% 19.74% 39.14% 25.32% 21.41%
Net interest margin4.33% 4.67% 4.73% 4.90% 5.17%
Net interest spread4.11% 4.48% 4.58% 4.80% 5.11%
Efficiency ratio (1)50.22% 48.51% 37.04% 48.90% 55.22%
Noninterest expense / average assets2.26% 2.34% 1.80% 2.52% 2.95%

(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
 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022
Total assets$2,062,486 $2,005,197 $1,959,802 $1,857,994 $1,759,204
Earning assets$2,034,556 $1,977,009 $1,927,061 $1,833,089 $1,733,577
Total loans, including loans held for sale$1,788,572 $1,745,113 $1,675,790 $1,597,236 $1,527,863
Total deposits$1,788,659 $1,698,892 $1,656,540 $1,624,777 $1,574,002
Total shareholders' equity$180,287 $173,347 $162,173 $146,778 $141,330



 Loan Balances by Type
 (Dollars in thousands)
 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022
Commercial Real Estate (CRE):         
Investor owned$583,069 $541,088 $527,819 $514,194 $517,462
Owner occupied 202,106  185,296  177,177  178,511  161,880
Multifamily 168,324  159,700  158,082  151,262  139,894
Secured by single family 146,370  153,132  148,464  147,813  135,164
Land and construction 33,655  30,253  32,519  26,953  21,234
SBA secured by real estate 349,676  343,576  329,403  272,059  263,355
Total CRE 1,483,200  1,413,045  1,373,464  1,290,792  1,238,989
Commercial business:         
Commercial and industrial 350,879  337,815  332,394  319,154  336,012
SBA non-real estate secured 9,807  11,081  9,121  10,591  11,449
Total commercial business 360,686  348,896  341,515  329,745  347,461
Consumer 3,275  2,905  2,726  2,491  1,798
Total loans held for investment$1,847,161 $1,764,846 $1,717,705 $1,623,028 $1,588,248



 Deposits by Type
 (Dollars in thousands)
 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022
Noninterest-bearing DDA$572,755 $595,023 $657,980 $639,664 $691,392
Interest-bearing DDA, excluding brokered 121,829  108,508  101,064  99,988  109,130
Savings & MMA, excluding brokered 742,617  696,499  670,195  637,031  614,991
Time deposits, excluding brokered 147,583  122,622  105,757  77,052  54,887
Total deposits, excluding brokered 1,584,784  1,522,652  1,534,996  1,453,735  1,470,400
Total brokered deposits 290,586  247,035  164,176  130,031  204,722
Total deposits$1,875,370 $1,769,687 $1,699,172 $1,583,766 $1,675,122



PRIVATE BANCORP OF AMERICA, INC.
(Unaudited)
 Rollforward of Allowance for Credit Losses
 (Dollars in thousands)
 For the three months ended
 Dec 31, 2023
 Sep 30, 2023
 Jun 30, 2023
 Mar 31, 2023
 Dec 31, 2022
Allowance for loan losses:          
Beginning balance$23,789 $22,588 $21,135  $19,152 $19,092
Impact of CECL adoption -  -  -   1,910  -
Provision for loan losses 687  1,194  (7,149)  73  60
Net (charge-offs) recoveries -  7  8,602   -  -
Ending balance 24,476  23,789  22,588   21,135  19,152
Reserve for unfunded commitments (1) 1,741  1,969  2,172   2,802  1,718
Total allowance for credit losses$26,217 $25,758 $24,760  $23,937 $20,870

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


 Asset Quality
 (Dollars in thousands)
 Dec 31, 2023
 Sep 30, 2023
 Jun 30, 2023
 Mar 31, 2023
 Dec 31, 2022
Total loans held-for-investment$1,847,161  $1,764,846  $1,717,705  $1,623,028  $1,588,248 
Allowance for loan losses$(24,476) $(23,789) $(22,588) $(21,135) $(19,152)
30-89 day past due loans and still accruing$-  $-  $-  $-  $- 
90+ day past due loans and still accruing$-  $-  $-  $-  $- 
Nonaccrual loans$5,053  $5,105  $3,354  $4,384  $3,880 
NPAs / Assets 0.23%  0.25%  0.17%  0.22%  0.21%
NPLs / Total loans held-for-investment & OREO 0.27%  0.29%  0.20%  0.27%  0.24%
Net quarterly charge-offs (recoveries)$-  $(7) $(8,602) $-  $- 
Net charge-offs (recoveries) /avg loans (annualized) 0.00%  0.00%  (2.05)%  0.00%  0.00%
Allowance for loan losses to loans HFI 1.33%  1.35%  1.32%  1.30%  1.21%
Allowance for loan losses to nonaccrual loans 484.39%  465.99%  673.46%  482.09%  493.61%


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
 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023  Mar 31, 2023 Dec 31, 2022
Adjusted income before provision for income taxes          
Income before provision for income taxes$11,205 $12,100 $22,109  $12,003 $10,545
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)$11,205 $12,100 $11,780  $12,003 $10,545
           
Adjusted net income          
Net income$7,859 $8,489 $15,534  $8,974 $7,443
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)$7,859 $8,489 $8,258  $8,974 $7,443
           
Adjusted diluted earnings per share ("Adjusted EPS")          
Diluted earnings per share$1.36 $1.47 $2.69  $1.57 $1.31
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 $1.47 $1.43  $1.57 $1.31
           
Diluted average shares outstanding 5,723,735  5,709,994  5,726,522   5,673,394  5,645,355

(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: 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)
     
 Year to Date
 Dec 31, 2023  Dec 31, 2022
Adjusted income before provision for income taxes    
Income before provision for income taxes$57,417  $34,942
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)$47,088  $34,942
     
Adjusted net income    
Net income$40,856  $24,709
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)$33,580  $24,709
     
Adjusted diluted earnings per share ("Adjusted EPS")    
Diluted earnings per share$7.11  $4.33
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)$5.85  $4.33
     
Diluted average shares outstanding 5,704,519   5,652,571

(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 
 Dec 31, 2023
 Sep 30, 2023
 Jun 30, 2023
 Mar 31, 2023
 Dec 31, 2022
Efficiency Ratio              
Noninterest expense$11,768  $11,843  $8,802  $11,557  $13,075 
Net interest income 22,188   23,255   22,708   22,168   22,596 
Noninterest income 1,244   1,159   1,054   1,465   1,084 
Total net interest income and noninterest income 23,432   24,414   23,762   23,633   23,680 
Efficiency ratio (non-GAAP) 50.22%  48.51%  37.04%  48.90%  55.22%
               
Adjusted Efficiency Ratio              
Noninterest expense$11,768  $11,843  $8,802  $11,557  $13,075 
Settlement of legal fees related to ANI litigation -   -   1,635   -   - 
Adjusted noninterest expense (non-GAAP) 11,768   11,843   10,437   11,557   13,075 
Total net interest income and noninterest income 23,432   24,414   23,762   23,633   23,680 
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) 23,432   24,414   23,678   23,633   23,680 
Adjusted Efficiency ratio (non-GAAP) 50.22%  48.51%  44.08%  48.90%  55.22%
               
Pretax pre-provision net revenue              
Net interest income$22,188  $23,255  $22,708  $22,168  $22,596 
Noninterest income 1,244   1,159   1,054   1,465   1,084 
Total net interest income and noninterest income 23,432   24,414   23,762   23,633   23,680 
Less: Noninterest expense 11,768   11,843   8,802   11,557   13,075 
Pretax pre-provision net revenue (non-GAAP)$11,664  $12,571  $14,960  $12,076  $10,605 
               
Return and Adjusted Return on Average Assets, Average Equity, Average Tangible Equity              
Net income$7,859  $8,489  $15,534  $8,974  $7,443 
Adjusted net income (non-GAAP) (1) 7,859   8,489   8,258   8,974   7,443 
Average assets 2,062,486   2,005,197   1,959,802   1,857,994   1,759,204 
Average shareholders' equity 180,287   173,347   162,173   146,778   141,330 
Less: Average intangible assets 2,451   2,709   2,975   3,026   3,385 
Average tangible common equity (non-GAAP) 177,836   170,638   159,198   143,752   137,945 
               
Return on average assets 1.51%  1.68%  3.18%  1.96%  1.68%
Adjusted return on average assets (non-GAAP) (1) 1.51%  1.68%  1.69%  1.96%  1.68%
Return on average equity 17.29%  19.43%  38.42%  24.80%  20.89%
Adjusted return on average equity (non-GAAP) (1) 17.29%  19.43%  20.42%  24.80%  20.89%
Return on average tangible common equity (non-GAAP) 17.53%  19.74%  39.14%  25.32%  21.41%
Adjusted return on average tangible common equity (non-GAAP) (1) 17.53%  19.74%  20.81%  25.32%  21.41%
               
Tangible book value per share              
Total equity 185,783   174,679   167,211   152,314   143,324 
Less: Total intangible assets 2,318   2,449   2,875   3,057   3,007 
Total tangible equity 183,465   172,230   164,336   149,257   140,317 
Shares outstanding 5,719,115   5,703,350   5,702,637   5,676,017   5,599,025 
Tangible book value per share (non-GAAP)$32.08  $30.20  $28.82  $26.30  $25.06 

(1) A reconciliation of net income to adjusted net income is provided on page 14.


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) 
      
 Year to Date 
 Dec 31, 2023  Dec 31, 2022 
Efficiency Ratio     
Noninterest expense$43,970  $48,244 
Net interest income 90,319   78,324 
Noninterest income 4,922   7,040 
Total net interest income and noninterest income 95,241   85,364 
Efficiency ratio (non-GAAP) 46.17%  56.52%
      
Adjusted Efficiency Ratio     
Noninterest expense$43,970  $48,244 
Settlement of legal fees related to ANI litigation 1,635   - 
Adjusted noninterest expense (non-GAAP) 45,605   48,244 
Total net interest income and noninterest income 95,241   85,364 
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) 95,157   85,364 
Adjusted Efficiency ratio (non-GAAP) 47.93%  56.52%
      
Pretax pre-provision net revenue     
Net interest income$90,319  $78,324 
Noninterest income 4,922   7,040 
Total net interest income and noninterest income 95,241   85,364 
Less: Noninterest expense 43,970   48,244 
Pretax pre-provision net revenue (non-GAAP)$51,271  $37,120 
      
Return and Adjusted Return on Average Assets, Average Equity, Average Tangible Equity     
Net income$40,856  $24,709 
Adjusted net income (non-GAAP) (1) 33,580   24,709 
Average assets 1,972,016   1,634,235 
Average shareholders' equity 165,749   136,031 
Less: Average intangible assets 2,774   3,463 
Average tangible common equity 162,975   132,568 
      
Return on average assets 2.07%  1.51%
Adjusted return on average assets (non-GAAP) (1) 1.70%  1.51%
Return on average equity 24.65%  18.16%
Adjusted return on average equity (non-GAAP) (1) 20.26%  18.16%
Return on average tangible common equity (non-GAAP) 25.07%  18.64%
Adjusted return on average tangible common equity (non-GAAP) (1) 20.60%  18.64%

(1) A reconciliation of net income to adjusted net income is provided on page 15.