NB Bancorp, Inc. Reports Fourth Quarter 2024 Financial Results and Announces Commencement of Share Repurchase Plan

Rhea-AI Summary

NB Bancorp (NBBK) reported strong Q4 2024 results with net income of $15.6 million ($0.40 per diluted share), up from $8.4 million in Q3. Operating net income was $13.3 million ($0.34 per diluted share). The company showed solid growth with deposits increasing 3.3% to $4.18 billion and loans growing 2.0% to $4.33 billion.

Key highlights include net interest margin expansion to 3.52%, tangible book value increase to $17.89 per share, and total assets reaching $5.16 billion. The company announced its first stock repurchase program since going public, authorizing the repurchase of up to 2,135,286 shares (approximately 5% of outstanding shares).

Asset quality remained strong with non-performing loans decreasing 13.5% to $13.9 million, and the allowance for credit losses at 0.89% of total gross loans.

Positive

• Net income increased 85.7% QoQ to $15.6 million
• Deposit growth of 3.3% outpaced loan growth of 2.0%
• Core deposits increased 4.2% ($154.9 million)
• Net interest margin expanded to 3.52%
• Non-performing loans decreased 13.5% to $13.9 million
• Announced 5% share repurchase program

Negative

• Net charge-offs of $479,000 in Q4
• Commercial real estate exposure increased 9.3%
• Noninterest expense increased 4.2% QoQ

Insights

Financial Analyst

NB Bancorp's Q4 2024 results reveal a robust financial position with several noteworthy developments. Net income jumped 85.7% quarter-over-quarter to $15.6 million, while the slight net interest margin expansion to 3.52% demonstrates resilient pricing power in a challenging rate environment.

The deposit growth story is particularly compelling, with core deposits increasing 4.2% while reducing reliance on higher-cost brokered deposits by 6.0%. This shift in funding mix suggests strong customer relationships and improving cost control. The 14.8% tangible equity ratio positions the bank well above regulatory requirements, providing ample flexibility for the newly announced share repurchase program.

The commercial real estate portfolio warrants attention, particularly the $333 million adjustable-rate multi-family portfolio in Greater Boston and the specialized cannabis facility lending segment. The conservative loan-to-value ratios under 65% for cannabis facilities and focus on suburban Class A/B medical offices rather than downtown high-rises demonstrates prudent risk management.

The announced 5% share repurchase program targeting 2.13 million shares is strategically timed, leveraging the strong capital position while potentially providing support for the stock price. With tangible book value at $17.89, the repurchase program could enhance shareholder returns if executed at attractive price levels.

Asset quality metrics remain solid with the ACL stable at 0.89% and significantly reduced net charge-offs of 0.04% annualized, down from 0.50% in Q3. The 13.5% reduction in non-performing loans to $13.9 million further reinforces the bank's credit discipline.

NEEDHAM, Mass., Jan. 22, 2025 /PRNewswire/ -- NB Bancorp, Inc. (the "Company") (Nasdaq Capital Market: NBBK), the holding company of Needham Bank (the "Bank"), today announced its fourth quarter 2024 financial results. The Company reported net income of $15.6 million, or $0.40 per diluted share, compared to net income of $8.4 million, or $0.21 per diluted share, for the prior quarter. Operating net income, excluding one-time charges, amounted to $13.3 million, or $0.34 per diluted share, compared to operating net income of $13.1 million, or $0.33 per diluted share for the prior quarter.

"We completed our first full year as a public company with a strong financial performance. Results for the fourth quarter include operating net income of $0.34 per share for the quarter and another quarter where our deposit growth outpaced loan growth, which were both impressive, at 3.3% and 2.0%, respectively. Tangible book value ended the year at $17.89, as we are happy to announce the commencement of our first share repurchase program, whereby we plan to prudently manage our capital levels as we head into 2025 with continued growth opportunities," commented Joseph Campanelli, Chairman, President and Chief Executive Officer. "Our first year as a public company was successful in many facets and we look forward to continued growth and success as we begin our second year of continuing to create shareholder value," Campanelli continued.

The Company announced today that it has adopted a stock repurchase program for up to 2,135,286 shares of the Company's common stock, which equals approximately 5.0% of the shares currently outstanding. This is the Company's first stock repurchase program since completing its mutual-to-stock conversion and related stock offering in December 2023.

SELECTED FINANCIAL HIGHLIGHTS FOR THE FOURTH QUARTER OF 2024

• Net income of $15.6 million, or $0.40 per diluted share, compared to net income of $8.4 million, or $0.21 per diluted share, for the prior quarter. Operating net income, excluding one-time charges, amounted to $13.3 million, or $0.34 per diluted share, compared to operating net income of $13.1 million, or $0.33 per diluted share for the prior quarter. One-time charges during the current quarter include:
  • Tax benefit related to an adjustment to a basis write-down of solar income tax credits of $2.5 million, partially offset by;
  • Tax expense and a modified endowment contract penalty related to the surrender of bank-owned life insurance ("BOLI") policies of $153 thousand.
• Net interest margin expanded one basis point to 3.52% during the current quarter from 3.51% in the prior quarter.
• Gross loans increased $84.1 million, or 2.0%, to $4.33 billion, from $4.25 billion the prior quarter.
• Total deposits increased $135.0 million, or 3.3%, from the prior quarter. Core deposits, which the Company considers to be all non-brokered deposits, increased $154.9 million, or 4.2%, for the current quarter, offset partially by a decrease in brokered deposits of $19.9 million or 6.0% from the prior quarter.
• Book value per share and tangible book value per share were $17.92 and $17.89, respectively, which increased from $17.50 and $17.48, respectively in the prior quarter. The increase in tangible book value per share was due to net income for the current quarter of $15.6 million and reversal of prior year deferred tax liabilities related to the adoption of the proportional amortization method ("PAM") on solar income tax credits of $2.3 million.

BALANCE SHEET
Total assets amounted to $5.16 billion as of December 31, 2024, representing an increase of $155.3 million, or 3.1%, from September 30, 2024.

• Cash and cash equivalents increased $46.8 million, or 14.8%, to $363.9 million from $317.0 million in the prior quarter, as a result of deposit growth outpacing loan growth.
• Net loans increased to $4.29 billion, representing an increase of $82.9 million, or 2.0%, from the prior quarter as demand for new originations continued. The current quarter growth was primarily seen in commercial real estate loans, which increased $143.9 million, or 9.3%, residential real estate loans, which increased $20.9 million or 1.7%, and consumer loans, which increased $10.1 million, or 4.3%, offset partially by a decrease in construction and land development loans of $83.1 million, or 12.5%, and a decrease in commercial and industrial loans of $7.1 million, or 1.3%.
• Prepaid expenses and other assets decreased $14.9 million, or 20.0%, to $59.5 million from $74.4 million, primarily from a decrease in income tax receivables of $14.9 million, as a result of the year-end true-up for deferred tax assets.
• Deferred income tax assets increased $12.8 million, or 73.5%, to $30.3 million from $17.5 million, as a result of the deferred tax assets from year-end true-up of solar tax credit carryforwards.
• Deposits totaled $4.18 billion, representing an increase of $135.0 million, or 3.3%, from the prior quarter. The increase in deposits was the result of growth in customer deposits, primarily money market accounts, which increased $91.9 million, or 8.9%, non-interest-bearing demand deposits, which increased $62.6 million, or 11.2% and NOW accounts which increased $22.9 million, or 6.9%. The above increases were partially offset by certificates of deposit, which decreased $20.1 million, or 1.2%, from the prior quarter, along with brokered deposits, which decreased $20.1 million, or 6.1%, from the prior quarter.
• FHLB borrowings increased to $120.8 million from $116.3 million, a $4.5 million, or 3.9%, increase during the current quarter as a result of the need to fund loan growth and maintain adequate cash levels.
• Shareholders' equity was $765.2 million, representing an increase of $17.7 million, or 2.4%, from the prior quarter, primarily as a result of $15.6 million of net income and a $2.3 million reversal of prior year deferred tax liabilities related to the adoption of PAM on solar income tax credits. Shareholders' equity to total assets and tangible shareholders' equity to tangible assets were both 14.8% at the end of the quarter.

NET INTEREST INCOME
Net interest income was $42.5 million for the quarter ended December 31, 2024, compared to $41.3 million for the prior quarter, representing an increase of $1.2 million, or 2.9%.

• The increase in interest income during the quarter ended December 31, 2024 was primarily attributable to increases in the average balance of loans, which contributed $1.5 million, increases in the average rate on other investments, which contributed $354 thousand and increases in the average balances of securities, which contributed $249 thousand. These increases were partially offset by decreases in the average rate on loans, which reduced interest income by $993 thousand during the quarter ended December 31, 2024.
• Interest expense remained unchanged for the quarter ended December 31, 2024 from the prior quarter.

NONINTEREST INCOME
Noninterest income was $3.8 million for the quarter ended December 31, 2024, compared to $1.3 million for the prior quarter, representing an increase of $2.5 million, or 198.9%.

• Net loss on sale of available-for-sale securities decreased $1.9 million, or 100.0%, to $0 during the quarter with no security sales during the current quarter compared to the loss trades executed to restructure the securities portfolio for higher yields and lower risk during the prior quarter.
• BOLI income was $1.0 million, compared to $414 thousand in the prior quarter, representing an increase of $635 thousand, or 153.4%, due to the BOLI restructure to higher rates in the prior quarter and carrying $50.0 million in additional BOLI policies while the older policies are in the process of being surrendered.

NONINTEREST EXPENSE
Noninterest expense for the quarter ended December 31, 2024 was $25.6 million, representing an increase of $1.0 million, or 4.2%, from the prior quarter.

• General and administrative expenses increased $1.6 million, or 1,432.2%, for the quarter ended December 31, 2024, primarily as a result of the adoption of Financial Accounting Standards Board Accounting Standards Update ("ASU") 2023-02 under the proportional amortization method ("PAM"), which reclassified amounts recognized in the first and second quarters of 2024 related to the amortization of solar tax credit investments from general and administration expenses to income tax expense during the prior quarter.
• Director and professional service fees increased $433 thousand during the quarter ended December 31, 2024, primarily as a result of increased consulting fees of $232 thousand, increased legal expenses of $130 thousand, and increased professional services of $79 thousand.
• Data processing expenses increased $252 thousand during the quarter ended December 31, 2024, primarily a result of increased IT infrastructure costs of $104 thousand and increased electronic banking and deposit service expenses of $120 thousand.
• FDIC and state assessments increased $229 thousand during the quarter ended December 31, 2024, primarily a result of increased FDIC assessment rates.
• Salaries and employee benefits were $15.7 million for the quarter ended December 31, 2024, representing a decrease of $1.5 million, or 8.5%, from the prior quarter, primarily driven by a decrease in incentive compensation expenses as the Company trued-up its bonus and other compensation amounts for year-end; partially offset by increased employee compensation of $179 thousand from the prior quarter.

INCOME TAXES
Income tax expense for the quarter ended December 31, 2024 was $3.7 million, representing a $3.3 million, or 47.6%, decrease from the prior quarter. The decrease was primarily driven by the reversal of a deferred tax liability related to the adoption of PAM under ASU 2023-02. The effective tax rate for the current quarter was 19.0%, compared to 45.5% in the prior quarter. The primary driver of the decrease in the effective tax rate was the income tax benefit for reversal of a deferred tax liability related to the adoption of PAM, which resulted in $2.5 million of income tax benefit. Excluding this item, the effective tax rate (non-GAAP) would have been 32.0%.

COMMERCIAL REAL ESTATE PORTFOLIO
Commercial real estate loans increased $143.9 million, or 9.3%, to $1.70 billion, during the quarter ended December 31, 2024.

• Cannabis facility commercial real estate loans increased $8.8 million, or 2.8%, during the quarter ended December 31, 2024. The Company's cannabis facility commercial real estate portfolio is secured entirely by the underlying commercial real estate of the borrower operation. The vast majority of the loan portfolio balances have a loan-to-value ratio of 65% or lower, with appraisal reports taking a blended approach (using both cannabis and non-cannabis use comparable real estate sales, which we believe are generally more conservative).
• The cannabis facility portfolio has geographic dispersion, with lower dollar exposure loans remaining local and larger dollar exposure loans generally tied to multi-state operators with a more national footprint. All cannabis facility loan relationships were pass-rated and current at the end of the current quarter.
• The Company's $333.0 million multi-family real estate loan portfolio consists of high-quality, performing loans primarily located in the Greater Boston area, primarily all of which are adjustable-rate loans.
• The Company's $182.8 million office portfolio consists principally of suburban Class A and B office space used as medical and traditional offices. The portfolio does not consist of high-rise towers located in Boston.

ASSET QUALITY

• The allowance for credit losses ("ACL") amounted to $38.7 million as of December 31, 2024, or 0.89% of total gross loans, compared to $37.6 million, or 0.89% of total loans at September 30, 2024. The Company recorded provisions for credit losses of $1.4 million during the quarter ended December 31, 2024, compared to $2.6 million for the prior quarter, which included a provision of $1.6 million for loans and a release of $214 thousand for unfunded commitments in the current quarter.
• Non-performing loans totaled $13.9 million as of December 31, 2024, a decrease of $2.2 million, or 13.5%, from $16.0 million at the end of the prior quarter. The decrease was primarily due to the reduction in one-to-four family residential loans on non-accrual of $2.1 million during the quarter ended December 31, 2024.
• During the quarter ended December 31, 2024, the Company recorded total net charge-offs of $479 thousand, or 0.04% of average total loans on an annualized basis, compared to $5.2 million, or 0.50% of average total loans on an annualized basis, in the prior quarter. The decrease in net charge-offs during the quarter ended December 31, 2024 was due to a $4.0 million charge-off of one commercial real estate office participation loan during the prior quarter and a $462 thousand decrease in purchased consumer loan charge-offs, along with a $308 thousand increase in recoveries during the quarter.
• The Company's loan portfolio consists primarily of commercial real estate and multi-family loans, one-to-four-family residential real estate loans, construction and land development loans, commercial and industrial loans and consumer loans. These loans are primarily made to individuals and businesses located in our primary lending market area, which is the Greater Boston metropolitan area and surrounding communities in Massachusetts, eastern Connecticut, southern New Hampshire and Rhode Island.

SHARE REPURCHASE PLAN
The Company announced today that it has adopted a share repurchase program for up to 2,135,286 shares of common stock, which equals approximately 5.0% of the shares currently issued and outstanding. 

• Shares may be repurchased in open market or private transactions, through block trades, or pursuant to any trading plan that may be adopted in accordance with Rule 10b5-1 of the Securities and Exchange Commission ("SEC").
• Repurchases will be made at management's discretion at prices management considers to be attractive and in the best interests of both the Company and its shareholders, subject to the availability of shares, general market conditions, the trading price of the stock, alternative uses for capital, and the Company's financial performance. Open market purchases may be subject to the limitations set forth in Rule 10b-18 of the SEC and other applicable legal requirements.
• The timing and amount of share repurchases under the share repurchase plan may be suspended, terminated or modified by the Company at any time for any reason, including market conditions, the cost of repurchasing shares, the availability of alternative investment opportunities, liquidity, and other factors deemed appropriate. These factors may also affect the timing and amount of share repurchases.

The Company is not obligated to repurchase any particular number of shares or any shares in any specific time period.

ABOUT NB BANCORP, INC.
NB Bancorp, Inc. (Nasdaq Capital Market: NBBK) is the registered bank holding company of Needham Bank. Needham Bank is headquartered in Needham, Massachusetts, which is approximately 17 miles southwest of Boston's financial district. Known as the "Builder's Bank," Needham Bank has been helping individuals, businesses and non-profits build for their futures since 1892. Needham Bank offers an array of tech-forward products and services that businesses and consumers use to manage their financial needs. We have the financial expertise typically found at much larger institutions and the local knowledge and commitment you can only find at a community bank. For more information, please visit https://NeedhamBank.com. Needham Bank is a member of FDIC and DIF.

Non-GAAP Financial Measures
In addition to results presented in accordance with accounting principles generally accepted in the United States of America ("GAAP"), this press release contains certain non-GAAP financial measures, including operating net income, operating noninterest expense, operating noninterest income, operating earnings per share, basic, operating earnings per share, diluted, operating return on average assets, operating return on average shareholders' equity, operating efficiency ratio, tangible shareholders' equity, tangible assets, tangible book value per share, and efficiency ratio. The Company's management believes that the supplemental non-GAAP information is utilized by regulators and market analysts to evaluate a Company's financial condition and therefore, such information is useful to investors. These disclosures should not be viewed as a substitute for financial results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names.

Forward-Looking Statements
Statements in this press release that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. We may also make forward-looking statements in other documents we file with the Securities and Exchange Commission (the "SEC"), in our annual reports to our stockholders, in press releases and other written materials, and in oral statements made by our officers, directors or employees. You can identify forward-looking statements by the use of the words "believe," "expect," "anticipate," "intend," "estimate," "assume," "outlook," "will," "should," and other expressions that predict or indicate future events and trends and which do not relate to historical matters. Although the Company believes that these forward-looking statements are based on reasonable estimates and assumptions, they are not guarantees of future performance and are subject to known and unknown risks, uncertainties, and other factors. You should not place undue reliance on our forward-looking statements. You should exercise caution in interpreting and relying on forward-looking statements because they are subject to significant risks, uncertainties and other factors which are, in some cases, beyond the Company's control. The Company's actual results could differ materially from those projected in the forward-looking statements as a result of, among other factors, changes in general business and economic conditions on a national basis and in the local markets in which the Company operates, including changes which adversely affect borrowers' ability to service and repay loans; changes in customer behavior due to political, business and economic conditions, including inflation and concerns about liquidity; turbulence in the capital and debt markets; reductions in net interest income resulting from interest rate volatility as well as changes in the balances and mix of loans and deposits; changes in interest rates and real estate values; changes in loan collectability and increases in defaults and charge-off rates; decreases in the value of securities and other assets, adequacy of credit loss reserves, or deposit levels necessitating increased borrowing to fund loans and investments; changing government regulation; competitive pressures from other financial institutions; changes in legislation or regulation and accounting principles, policies and guidelines; cybersecurity incidents, fraud, natural disasters, and future pandemics; the risk that the Company may not be successful in the implementation of its business strategy; the risk that intangibles recorded in the Company's financial statements will become impaired; changes in assumptions used in making such forward-looking statements; and the other risks and uncertainties detailed in the Company's Form 10-K and updated by our Quarterly Report on Form 10-Q and other filings submitted to the SEC. These statements speak only as of the date of this release and the Company does not undertake any obligation to update or revise any of these forward-looking statements to reflect events or circumstances occurring after the date of this communication or to reflect the occurrence of unanticipated events.

NB BANCORP, INC.
SELECTED FINANCIAL HIGHLIGHTS
(Unaudited)
(Dollars in thousands, except per share data)
	As of and for the three months ended
	December 31, 2024			September 30, 2024			December 31, 2023
Earnings data
Net interest income	$	42,521		$	41,324		$	35,278
Noninterest income		3,781			1,265			3,252
Total revenue		46,302			42,589			38,530
Provision for credit losses		1,404			2,623			5,901
Noninterest expense		25,623			24,586			52,788
Pre-tax income (loss)		19,275			15,380			(20,159)
Net income (loss)		15,611			8,383			(13,617)
Operating net income (non-GAAP)		13,261			13,116			10,880
Operating noninterest expense (non-GAAP)		25,623			25,499			23,875
Per share data
Earnings (loss) per share, basic	$	0.40		$	0.21		$	(0.32)
Earnings (loss) per share, diluted		0.40			0.21			(0.32)
Operating earnings per share, basic (non-GAAP)		0.34			0.33			0.26
Operating earnings per share, diluted (non-GAAP)		0.34			0.33			0.26
Book value per share		17.92			17.50			17.75
Tangible book value per share (non-GAAP)		17.89			17.48			17.72
Profitability
Return (loss) on average assets		1.23 %			0.68 %			(1.25) %
Operating return on average assets (non-GAAP)		1.04 %			1.07 %			1.00 %
Return (loss) on average shareholders' equity		8.22 %			4.42 %			(13.75) %
Operating return on average shareholders' equity (non-GAAP)		6.98 %			6.91 %			10.99 %
Net interest margin		3.52 %			3.51 %			3.40 %
Cost of deposits		3.24 %			3.37 %			2.84 %
Efficiency ratio		55.34 %			57.73 %			137.00 %
Operating efficiency ratio (non-GAAP)		55.34 %			57.36 %			61.96 %
Balance sheet, end of period
Total assets	$	5,157,737		$	5,002,394		$	4,533,391
Total loans		4,333,152			4,249,074			3,889,279
Total deposits		4,177,652			4,042,654			3,387,327
Total shareholders' equity		765,167			747,449			757,959
Asset quality
Allowance for credit losses (ACL)	$	38,744		$	37,605		$	32,222
ACL / Total non-performing loans (NPLs)		279.6 %			234.9 %			298.4 %
Total NPLs / Total loans		0.32 %			0.38 %			0.28 %
Net charge-offs (annualized) / Average total loans		(0.04) %			(0.50) %			(0.14) %
Capital ratios
Shareholders' equity / Total assets		14.84 %			14.94 %			16.72 %
Tangible shareholders' equity / tangible assets (non-GAAP)		14.82 %			14.92 %			16.70 %

 

NB BANCORP, INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Dollars in thousands, except share and per share data)
	As of									December 31, 2024 change from
	December 31, 2024			September 30, 2024			December 31, 2023			September 30, 2024				December 31, 2023
Assets
Cash and due from banks	$	211,166		$	148,187		$	90,485		$	62,979	42.5 %		$	120,681	133.4 %
Federal funds sold		152,689			168,862			182,106			(16,173)	(9.6) %			(29,417)	(16.2) %
Total cash and cash equivalents		363,855			317,049			272,591			46,806	14.8 %			91,264	33.5 %
Available-for-sale securities, at fair value		228,205			202,541			189,465			25,664	12.7 %			38,740	20.4 %
Loans receivable, net of deferred fees		4,333,152			4,249,074			3,889,279			84,078	2.0 %			443,873	11.4 %
Allowance for credit losses		(38,744)			(37,605)			(32,222)			(1,139)	3.0 %			(6,522)	20.2 %
Net loans		4,294,408			4,211,469			3,857,057			82,939	2.0 %			437,351	11.3 %
Accrued interest receivable		19,685			18,671			17,284			1,014	5.4 %			2,401	13.9 %
Banking premises and equipment, net		34,654			34,802			35,531			(148)	(0.4) %			(877)	(2.5) %
Non-public investments		24,364			24,271			38,733			93	0.4 %			(14,369)	(37.1) %
Bank-owned life insurance ("BOLI")		102,785			101,736			50,516			1,049	1.0 %			52,269	103.5 %
Prepaid expenses and other assets		59,482			74,387			53,088			(14,905)	(20.0) %			6,394	12.0 %
Deferred income tax asset		30,299			17,468			19,126			12,831	73.5 %			11,173	58.4 %
Total assets	$	5,157,737		$	5,002,394		$	4,533,391		$	155,343	3.1 %		$	624,346	13.8 %
Liabilities and shareholders' equity
Deposits
Core Deposits	$	3,867,846		$	3,712,904		$	3,203,755		$	154,942	4.2 %		$	664,091	20.7 %
Brokered Deposits		309,806			329,750			183,572			(19,944)	(6.0) %			126,234	68.8 %
Total Deposits		4,177,652			4,042,654			3,387,327			134,998	3.3 %			790,325	23.3 %
Mortgagors' escrow accounts		4,549			4,401			4,229			148	3.4 %			320	7.6 %
FHLB borrowings		120,835			116,335			283,338			4,500	3.9 %			(162,503)	(57.4) %
Accrued expenses and other liabilities		65,708			68,290			81,046			(2,582)	(3.8) %			(15,338)	(18.9) %
Accrued retirement liabilities		23,826			23,265			19,492			561	2.4 %			4,334	22.2 %
Total liabilities		4,392,570			4,254,945			3,775,432			137,625	3.2 %			617,138	16.3 %
Shareholders' equity:
Preferred stock, $0.01 par value, 5,000,000 shares authorized; no shares
issued and outstanding		-			-			-			-	0.0 %			-	0.0 %
Common stock, $0.01 par value, 120,000,000 shares authorized; 42,705,729
issued and outstanding at December 31 and September 30, 2024 and December 31, 2023, respectively		427			427			427			-	0.0 %			-	0.0 %
Additional paid-in capital		417,247			417,013			417,030			234	0.1 %			217	0.1 %
Unallocated common shares held by the Employee Stock Ownership Plan ("ESOP")		(44,813)			(45,407)			(13,774)			594	(1.3) %			(31,039)	225.3 %
Retained earnings		400,473			382,560			366,173			17,913	4.7 %			34,300	9.4 %
Accumulated other comprehensive loss		(8,167)			(7,144)			(11,897)			(1,023)	14.3 %			3,730	(31.4) %
Total shareholders' equity		765,167			747,449			757,959			17,718	2.4 %			7,208	1.0 %
Total liabilities and shareholders' equity	$	5,157,737		$	5,002,394		$	4,533,391		$	155,343	3.1 %		$	624,346	13.8 %

 

NB BANCORP, INC.
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(Dollars in thousands, except share and per share data)
	For the Three Months Ended									Three Months Ended December 31, 2024 Change From Three Months Ended
	December 31, 2024			September 30, 2024			December 31, 2023			September 30, 2024				December 31, 2023
INTEREST AND DIVIDEND INCOME
Interest and fees on loans	$	70,977		$	70,518		$	61,696		$	459	0.7 %		$	9,281	15.0 %
Interest on investment securities		2,116			1,768			1,161			348	19.7 %			955	82.3 %
Interest and dividends on cash equivalents and other		4,107			3,717			1,445			390	10.5 %			2,662	184.2 %
Total interest and dividend income		77,200			76,003			64,302			1,197	1.6 %			12,898	20.1 %
INTEREST EXPENSE
Interest on deposits		33,514			33,612			25,845			(98)	(0.3) %			7,669	29.7 %
Interest on borrowings		1,165			1,067			3,179			98	9.2 %			(2,014)	(63.4) %
Total interest expense		34,679			34,679			29,024			-	0.0 %			5,655	19.5 %
NET INTEREST INCOME		42,521			41,324			35,278			1,197	2.9 %			7,243	20.5 %
PROVISION FOR CREDIT LOSSES
Provision for credit losses - loans		1,618			4,997			1,662			(3,379)	(67.6) %			(44)	(2.6) %
(Release of) provision for credit losses - unfunded commitments		(214)			(2,374)			4,239			2,160	(91.0) %			(4,453)	(105.0) %
Total provision for credit losses		1,404			2,623			5,901			(1,219)	(46.5) %			(4,497)	(76.2) %
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES		41,117			38,701			29,377			2,416	6.2 %			11,740	40.0 %
NONINTEREST INCOME
Customer service fees		2,068			1,963			2,633			105	5.3 %			(565)	(21.5) %
Increase in cash surrender value of BOLI		1,049			414			394			635	153.4 %			655	166.2 %
Mortgage banking income		118			367			112			(249)	(67.8) %			6	5.4 %
Swap contract income		531			375			95			156	41.6 %			436	458.9 %
Loss on sale of available-for-sale securities, net		-			(1,868)			-			1,868	100.0 %			-	0.0 %
Other income		15			14			18			1	7.1 %			(3)	(16.7) %
Total noninterest income		3,781			1,265			3,252			2,516	198.9 %			529	16.3 %
NONINTEREST EXPENSE
Salaries and employee benefits		15,747			17,202			24,311			(1,455)	(8.5) %			(8,564)	(35.2) %
Director and professional service fees		2,428			1,995			1,247			433	21.7 %			1,181	94.7 %
Occupancy and equipment expenses		1,388			1,394			1,266			(6)	(0.4) %			122	9.6 %
Data processing expenses		2,478			2,226			2,044			252	11.3 %			434	21.2 %
Marketing and charitable contribution expenses		779			842			20,110			(63)	(7.5) %			(19,331)	(96.1) %
FDIC and state insurance assessments		1,041			812			1,863			229	28.2 %			(822)	(44.1) %
General and administrative expenses		1,762			115			1,947			1,647	1432.2 %			(185)	(9.5) %
Total noninterest expense		25,623			24,586			52,788			1,037	4.2 %			(27,165)	(51.5) %
INCOME (LOSS) BEFORE TAXES		19,275			15,380			(20,159)			3,895	25.3 %			39,434	195.6 %
INCOME TAX EXPENSE (BENEFITS)		3,664			6,997			(6,542)			(3,333)	(47.6) %			10,206	156.0 %
NET INCOME (LOSS)	$	15,611		$	8,383		$	(13,617)		$	7,228	86.2 %		$	29,228	214.6 %
Weighted average common shares outstanding, basic		39,291,088			39,289,271			42,018,229			1,817	0.0 %			(2,727,141)	(6.5) %
Weighted average common shares outstanding, diluted		39,291,088			39,289,271			42,018,229			1,817	0.0 %			(2,727,141)	(6.5) %
Earnings (loss) per share, basic	$	0.40		$	0.21		$	(0.32)		$	0.18	86.2 %		$	0.72	222.6 %
Earnings (loss) per share, diluted	$	0.40		$	0.21		$	(0.32)		$	0.18	86.2 %		$	0.72	222.6 %

 

NB BANCORP, INC.
AVERAGE BALANCES, INTEREST EARNED/PAID & AVERAGE YIELDS
(Unaudited)
(Dollars in thousands)
		For the Three Months Ended
		December 31, 2024								September 30, 2024								December 31, 2023
		Average								Average								Average
		Outstanding						Average		Outstanding						Average		Outstanding						Average
		Balance			Interest			Yield/Rate (4)		Balance			Interest			Yield/Rate (4)		Balance			Interest			Yield/Rate (4)
Interest-earning assets:
Loans		$	4,278,952		$	70,977		6.60	%	$	4,188,504		$	70,518		6.70	%	$	3,784,363		$	61,696		6.47	%
Securities			215,268			2,116		3.91	%		204,273			1,768		3.44	%		194,024			1,161		2.37	%
Other investments (5)			27,217			586		8.57	%		26,239			223		3.38	%		30,268			430		5.64	%
Short-term investments (5)			283,540			3,521		4.94	%		264,394			3,494		5.26	%		111,067			1,015		3.63	%
Total interest-earning assets			4,804,977			77,200		6.39	%		4,683,410			76,003		6.46	%		4,119,722			64,302		6.19	%
Non-interest-earning assets			285,715								245,138								236,755
Allowance for credit losses			(38,231)								(38,495)								(32,638)
Total assets		$	5,052,461							$	4,890,053							$	4,323,839
Interest-bearing liabilities:
Savings accounts		$	121,709			14		0.05	%	$	112,632			15		0.05	%	$	135,629			17		0.05	%
NOW accounts			326,379			283		0.34	%		327,484			180		0.22	%		330,830			204		0.24	%
Money market accounts			951,916			9,203		3.85	%		876,933			8,943		4.06	%		829,353			6,869		3.29	%
Certificates of deposit and individual retirement accounts			1,990,735			24,014		4.80	%		1,940,992			24,474		5.02	%		1,580,491			18,755		4.71	%
Total interest-bearing deposits			3,390,739			33,514		3.93	%		3,258,041			33,612		4.10	%		2,876,303			25,845		3.56	%
FHLB advances			95,873			1,165		4.83	%		85,156			1,067		4.98	%		220,475			3,179		5.72	%
Total interest-bearing liabilities			3,486,612			34,679		3.96	%		3,343,197			34,679		4.13	%		3,096,778			29,024		3.72	%
Non-interest-bearing deposits			725,377								713,566								729,928
Other non-interest-bearing liabilities			84,964								78,681								104,211
Total liabilities			4,296,953								4,135,444								3,930,917
Shareholders' equity			755,508								754,609								392,922
Total liabilities and shareholders' equity		$	5,052,461							$	4,890,053							$	4,323,839
Net interest income					$	42,521							$	41,324							$	35,278
Net interest rate spread (1)								2.43	%							2.33	%							2.47	%
Net interest-earning assets (2)		$	1,318,365							$	1,340,213							$	1,022,944
Net interest margin (3)								3.52	%							3.51	%							3.40	%
Average interest-earning assets to interest-bearing liabilities			137.81	%							140.09	%							133.03	%

(1) Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average rate of interest-bearing liabilities.

(2) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.

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

(4) Annualized

(5) Other investments are comprised of FRB stock, FHLB stock and swap collateral accounts.  Short-term investments are comprised of cash and cash equivalents.

 

NB BANCORP, INC.
COMMERCIAL REAL ESTATE BY COLLATERAL TYPE
(Unaudited)
(Dollars in thousands)
	December 31, 2024
	Owner-Occupied			Non-Owner- Occupied			Balance			Percentage
Multi-Family	$	—		$	333,047		$	333,047			20 %
Cannabis Facility		310,773			15,257			326,030			19 %
Industrial		123,191			74,057			197,248			12 %
Office		31,075			151,729			182,804			11 %
Hospitality		—			164,520			164,520			10 %
Special Purpose		77,730			54,355			132,085			8 %
Retail		46,126			91,471			137,597			8 %
Mixed-Use		9,023			103,748			112,771			6 %
Other		41,490			68,849			110,339			6 %
Total commercial real estate	$	639,408		$	1,057,033		$	1,696,441			100 %

	September 30, 2024												Change From Three Months Ended December 31, 2024
	Owner- Occupied			Non- Owner- Occupied			Balance			Percentage			Owner- Occupied			Non- Owner- Occupied			Balance			Percentage
Multi-Family	$	—		$	272,561		$	272,561			18 %		$	—		$	60,486		$	60,486			22 %
Cannabis Facility		301,931			15,334			317,265			20 %			8,842			(77)			8,765			3 %
Industrial		110,091			53,185			163,276			10 %			13,100			20,872			33,972			21 %
Office		30,884			177,614			208,498			13 %			191			(25,885)			(25,694)			(12) %
Hospitality		55			157,027			157,082			10 %			(55)			7,493			7,438			5 %
Special Purpose		80,575			54,432			135,007			9 %			(2,845)			(77)			(2,922)			(2) %
Retail		27,466			91,412			118,878			8 %			18,660			59			18,719			16 %
Mixed-Use		8,509			63,292			71,801			5 %			514			40,456			40,970			57 %
Other		41,577			66,570			108,147			7 %			(87)			2,279			2,192			2 %
Total commercial real estate	$	601,088		$	951,427		$	1,552,515			100 %		$	38,320		$	105,606		$	143,926			9 %
	December 31, 2023												Change From Three Months Ended December 31, 2024
	Owner- Occupied			Non- Owner- Occupied			Balance			Percentage			Owner- Occupied			Non- Owner- Occupied			Balance			Percentage
Multi-Family	$	—		$	209,982		$	209,982			15 %		$	—		$	123,065		$	123,065			59 %
Cannabis Facility		242,713			15,553			258,266			19 %			68,060			(296)			67,764			26 %
Industrial		108,494			2,966			111,460			8 %			14,697			71,091			85,788			77 %
Office		27,741			159,241			186,982			14 %			3,334			(7,512)			(4,178)			(2) %
Hospitality		35			148,278			148,313			11 %			(35)			16,242			16,207			11 %
Special Purpose		79,676			54,126			133,802			10 %			(1,946)			229			(1,717)			(1) %
Retail		27,709			103,996			131,705			9 %			18,417			(12,525)			5,892			4 %
Mixed-Use		8,765			62,563			71,328			5 %			258			41,185			41,443			58 %
Other		28,524			99,479			128,003			9 %			12,966			(30,630)			(17,664)			(14) %
Total commercial real estate	$	523,657		$	856,184		$	1,379,841			100 %		$	115,751		$	200,849		$	316,600			23 %

 

NB BANCORP, INC.
NON-GAAP RECONCILIATION
(Unaudited)
(Dollars in thousands)
	For the Three Months Ended
	December 31, 2024			September 30, 2024			December 31, 2023
Net income (GAAP)	$	15,611		$	8,383		$	(13,617)
Add (Subtract):
Adjustments to net income:
Losses on sales of securities available for sale, net		-			1,868			-
Income tax expense (benefit) on solar tax credit investment basis reduction		(2,503)			2,503			-
BOLI surrender tax and modified endowment contract penalty		153			1,552			-
Adjustment for adoption of ASU 2023-02		-			(913)			-
Needham Bank Charitable Foundation contribution resulting from IPO		-			-			19,082
One-time conversion and IPO-related compensation expense		-			-			7,931
Defined benefit pension termination expense		-			-			1,900
Permanent tax differences resulting from public company tax laws (1)		-			-			3,680
Total adjustments to net income	$	(2,350)		$	5,010		$	32,593
Less net tax benefit (expense) associated with non-GAAP adjustments		-			277			8,096
Non-GAAP adjustments, net of tax		(2,350)			4,733			24,497
Operating net income (non-GAAP)	$	13,261		$	13,116		$	10,880
Weighted average common shares outstanding, basic		39,291,088			39,289,271			42,018,229
Weighted average common shares outstanding, diluted		39,291,088			39,289,271			42,018,229
Operating earnings per share, basic (non-GAAP)	$	0.34		$	0.33		$	0.26
Operating earnings per share, diluted (non-GAAP)	$	0.34		$	0.33		$	0.26
(1) These amounts are reflected in income tax expense and reflect amounts related to 2023
compensation and a writedown for future LTIP vesting amounts that are not expected to be deductible
on a tax return. These amounts are not included in the calculation of the tax impact on the non-GAAP adjustments.
Noninterest expense (GAAP)	$	25,623		$	24,586		$	52,788
Subtract (Add):
Noninterest expense components:
Adjustment for adoption of ASU 2023-02		-			(913)			-
Needham Bank Charitable Foundation contribution resulting from IPO		-			-			19,082
One-time conversion and IPO-related compensation expense		-			-			7,931
Defined benefit pension termination expense		-			-			1,900
Total impact of non-GAAP noninterest expense adjustments	$	-		$	(913)		$	28,913
Noninterest expense on an operating basis (non-GAAP)	$	25,623		$	25,499		$	23,875
Noninterest income (GAAP)	$	3,781		$	1,265		$	3,252
Subtract (Add):
Noninterest expense components:
Losses on sales of securities available for sale, net		-			(1,868)			-
Total impact of non-GAAP noninterest income adjustments	$	-		$	(1,868)		$	-
Noninterest income on an operating basis (non-GAAP)	$	3,781		$	3,133		$	3,252
Operating net income (non-GAAP)	$	13,261		$	13,116		$	10,880
Average assets		5,052,461			4,890,053			4,323,839
Operating return on average assets (non-GAAP)		1.04 %			1.07 %			1.00 %
Average shareholders' equity	$	755,508		$	754,609		$	392,922
Operating return on average shareholders' equity (non-GAAP)		6.98 %			6.91 %			10.99 %
Noninterest expense on an operating basis (non-GAAP)	$	25,623		$	25,499		$	23,875
Total revenue (net interest income plus total noninterest income on an operating basis) (non-GAAP)		46,302			44,457			38,530
Operating efficiency ratio (non-GAAP)		55.34 %			57.36 %			61.96 %
	As of
	December 31, 2024			September 30, 2024			December 31, 2023
Total shareholders' equity (GAAP)	$	765,167		$	747,449		$	757,959
Subtract:
Intangible assets (core deposit intangible)		1,079			1,116			1,227
Total tangible shareholders' equity (non-GAAP)		764,088			746,333			756,732
Total assets (GAAP)		5,157,737			5,002,394			4,533,391
Subtract:
Intangible assets (core deposit intangible)		1,079			1,116			1,227
Total tangible assets (non-GAAP)	$	5,156,658		$	5,001,278		$	4,532,164
Tangible shareholders' equity / tangible assets (non-GAAP)		14.82 %			14.92 %			16.70 %
Total common shares outstanding		42,705,729			42,705,729			42,705,729
Tangible book value per share (non-GAAP)	$	17.89		$	17.48		$	17.72

 

NB BANCORP, INC.
ASSET QUALITY – NON-PERFORMING ASSETS (1)
(Unaudited)
(Dollars in thousands)
		December 31, 2024			September 30, 2024			December 31, 2023
Real estate loans:
One-to-four-family residential		$	2,930		$	5,070		$	4,100
Home equity			958			1,060			590
Commercial real estate			3,005			3,030			422
Construction and land development			10			10			10
Commercial and industrial			4,558			4,743			4,138
Consumer			2,395			2,099			1,539
Total		$	13,856		$	16,012		$	10,799
Total non-performing loans to total loans			0.32 %			0.38 %			0.28 %
Total non-performing assets to total assets			0.27 %			0.32 %			0.24 %

(1) Non-performing loans and assets are comprised of non-accrual loans

 

NB BANCORP, INC.
ASSET QUALITY – PROVISION, ALLOWANCE, AND NET (CHARGE-OFFS) RECOVERIES
(Unaudited)
(Dollars in thousands)
	For the Three Months Ended
	December 31, 2024			September 30, 2024			December 31, 2023
Allowance for credit losses at beginning of the period	$	37,605		$	37,857		$	31,889
Provision for credit losses		1,618			4,997			1,662
Charge-offs:
Consumer		843			1,305			1,519
Commercial real estate		—			4,000			—
Total charge-offs		843			5,305			1,519
Recoveries of loans previously charged off:
Commercial and industrial		202			12			12
Consumer		162			44			178
Total recoveries		364			56			190
Net charge-offs		(479)			(5,249)			(1,329)
Allowance for credit losses at end of the period	$	38,744		$	37,605		$	32,222
Allowance to non-performing loans		279.6 %			234.9 %			298.4 %
Allowance to total loans outstanding at the end of the period		0.89 %			0.89 %			0.83 %
Net charge-offs (annualized) to average loans outstanding during the period		(0.04) %			(0.50) %			(0.14) %

 

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SOURCE Needham Bank

FAQ

What was NBBK's net income for Q4 2024?

NBBK reported net income of $15.6 million ($0.40 per diluted share) in Q4 2024, compared to $8.4 million ($0.21 per diluted share) in Q3 2024.

How many shares are included in NBBK's 2024 stock repurchase program?

NBBK's stock repurchase program authorizes the repurchase of up to 2,135,286 shares, representing approximately 5% of currently outstanding shares.

What was NBBK's deposit growth in Q4 2024?

Total deposits increased by $135.0 million or 3.3% in Q4 2024, with core deposits growing by $154.9 million or 4.2%.

What was NBBK's loan growth in Q4 2024?

Gross loans increased by $84.1 million or 2.0% to $4.33 billion in Q4 2024.

What was NBBK's tangible book value per share in Q4 2024?

NBBK's tangible book value per share was $17.89 at the end of Q4 2024, an increase from $17.48 in the previous quarter.