Private Bancorp of America, Inc. Announces Record Fourth Quarter and Full Year 2022 Financial Results with Total Assets of $1.9 Billion

Rhea-AI Summary

Private Bancorp of America, Inc. (PBAM) reported strong financial results for the fourth quarter and full year ended December 31, 2022. Net income for Q4 reached $7.4 million, a 17% increase from the previous quarter; diluted earnings per share were $1.31. Total loans held-for-investment rose to $1.6 billion, up 6.8% from Q3 2022.

For the full year, net income was $24.7 million, up 17.4% year-over-year, with a diluted EPS of $4.33. The net interest margin improved to 5.17% in Q4. Despite rising funding costs and a slight decline in noninterest income, the company remained optimistic about future growth and performance.

Positive

• Net income increased 17.0% to $7.4 million in Q4 2022.
• Diluted earnings per share rose 17.0% to $1.31 in Q4 2022.
• Total loans held-for-investment grew by $100.9 million or 6.8% in Q4 2022.
• Record full-year net income of $24.7 million, up 17.4% from FY 2021.
• Net interest margin improved to 5.17% in Q4 2022.

Negative

• Noninterest-bearing demand deposits declined by $71.8 million or 9.4% from the prior quarter.
• Noninterest income decreased by $333,000 compared to Q3 2022.

Fourth Quarter Highlights

• Net income for the fourth quarter of 2022 was $7.4 million, up 17.0% from the prior quarter and 5.0% from the same period in the prior year
• Diluted earnings per share for the fourth quarter of 2022 was $1.31, up 17.0% from the prior quarter and 5.6% from the same period in the prior year
• Total loans held-for-investment (“HFI”) reached $1.6 billion at December 31, 2022, an increase of $100.9 million or 6.8% from the prior quarter
• The allowance for loan losses was 1.21% of total loans HFI at December 31, 2022 compared to 1.28% as of September 30, 2022
• The provision for loan losses for the fourth quarter of 2022 was $60 thousand, a decrease from $1.3 million for the prior quarter
• Noninterest-bearing demand deposits, which represent 41.3% of total deposits at December 31, 2022, declined $71.8 million or 9.4% from the prior quarter. Total core deposits, which exclude brokered deposits, were $1.5 billion.
• Net interest margin was 5.17% for the fourth quarter of 2022, as compared to 4.99% for the prior quarter and 4.44% for the same period in the prior year
• Total cost of funding sources increased to 0.86% for the fourth quarter of 2022, an increase from 0.36% in the prior quarter. Total cost of deposits was 0.79%
• Tangible book value per share was $25.02 at December 31, 2022, up from $23.51 September 30, 2022 as a result of strong earnings
  

2022 Full Year and Period End Highlights

• Record net income of $24.7 million, an increase of 17.4% from $21.0 million for FY’21
• Diluted earnings per share of $4.33, an increase of 17.2% from $3.69 for FY’21
• Pretax, pre-provision net revenue of $37.1 million, representing a 13.9% increase from $32.6 million for FY’21
• Return on average assets of 1.51%, compared to 1.48% for FY’21
• Return on average equity of 18.16%, compared to 17.77% for FY’21
• Net interest margin of 4.87%, compared to 4.19% for FY’21
• Total assets increased to $1.9 billion, representing an increase of 22.2% since December 31, 2021
• Loans HFI reached $1.6 billion, an increase of $363.8 million or 29.7% since December 31, 2021
• Total deposits reached $1.7 billion, an increase of $329.5 million or 24.5% since December 31, 2021
• Non-interest-bearing demand deposits reached $691.4 million, an increase of $8.8 million or 1.3% since December 31, 2021

LA JOLLA, Calif., Jan. 30, 2023 (GLOBE NEWSWIRE) -- Private Bancorp of America, Inc. (OTCQX:PBAM), (“Company”) and CalPrivate Bank (“Bank”) announced unaudited financial results for the fourth quarter and full year ended December 31, 2022. The Company reported net income of $7.4 million, or $1.31 per diluted share, for the fourth quarter of 2022 compared to $7.3 million, or $1.28 per diluted share, for the prior year same quarter. Net income was $24.7 million, or $4.33 per diluted share, for the year ended December 31, 2022, compared to $21.0 million, or $3.69 per diluted share, in FY’21.

Rick Sowers, President and CEO of the Company and the Bank stated, “I am extremely proud of the progress our Team made this year. Earnings set a new record for the Company and despite a challenging environment, CalPrivate’s commitment to our Distinctly Different service remained steadfast and allowed our Team to focus on delivering value to Clients and Shareholders. Loan growth was strong for the quarter and full year, increasing $100.9 million and $363.8 million, respectively.”

Sowers added, “Net interest income was strong at $22.6 million for Q4’22. Additionally, while growing our revenue, we continued efforts to monitor and manage our efficiency ratio, which was 55.2% in Q4’22. While we anticipate that funding costs will increase, and there is mounting competition for deposits, we will continue to invest in our infrastructure to bring world class service to our Clients.”

“The Company continues to exhibit successful customer acquisition activity as shown by the growth in loans despite a rising rate environment. Additionally, the Company continues to invest in people and infrastructure needed to support the continued growth of the CalPrivate franchise,” said Selwyn Isakow, Chairman of the Board of the Company and the Bank.

Isakow added, “The Board is pleased with CalPrivate’s financial performance in 2022, and we remain optimistic about management’s ability to react to and successfully navigate the Company during these uncertain times.”

STATEMENT OF INCOME

Net Interest Income

Net interest income for the fourth quarter of 2022 totaled $22.6 million, representing an increase of $2.0 million or 9.7% compared to the prior quarter. This increase was driven primarily by $4.1 million higher interest income caused by the increase in average loan balances and higher yield on loans partially offset by the $2.1 million increase in interest expense, which resulted from higher deposit costs due to higher average deposit balances along with an increase in deposit rates.

Net Interest Margin

The net interest margin for the fourth quarter of 2022 was 5.17% compared to 4.99% for the prior quarter. The 18 basis point increase in net interest margin was due to higher rates on new loan originations and variable rate loans and investment securities, partially offset by higher rates paid on deposits. The yield on earning assets was 5.97% for the fourth quarter of 2022 compared with 5.32% for the prior quarter and the cost of total funding sources was 0.86% for the fourth quarter of 2022 compared to 0.36% in the prior quarter.

Provision for Loan Losses

The provision for loan losses for the fourth quarter of 2022 was $60 thousand, as compared to $1.3 million in the prior quarter. For more details, please refer to the “Asset Quality” section below.

Noninterest Income

Noninterest income was $1.1 million for the fourth quarter of 2022, a decline of $333 thousand compared to the third quarter of 2022. SBA loan sales for the fourth quarter of 2022 were $11.4 million with a 10.23% average trade premium resulting in a net gain on sale of $792 thousand, compared with $10.4 million with a 9.2% average trade premium resulting in a net gain on sale of $647 thousand in the prior quarter. The decline in noninterest income was primarily related to faster prepayments in the SBA portfolio which resulted in accelerated amortization and valuation adjustments to the SBA servicing asset.

Noninterest Expense

Noninterest expense was $13.1 million for the fourth quarter of 2022, an increase of $1.3 million, or 11.5%, compared to the prior quarter. Much of the increase was due to higher variable compensation and benefits expense related to strong loan growth, partially offset by the decline in professional services related to the active and on-going lawsuit for the recovery of the charged-off loan for the ANI Development, LLC/Gina Champion-Cain fraud case and Chicago Title (parent company, Fidelity National Financial) for its alleged involvement with the fraud scheme.

Additionally, the Company remains committed to making investments in the business, including technology, marketing, and staffing. Historically high inflation 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 $3.1 million for the fourth quarter of 2022, compared to $2.6 million for the prior quarter. The effective tax rate for 2022 was 29.3% compared to 29.6% for 2021.

STATEMENT OF FINANCIAL CONDITION

The Company reported total assets of $1.9 billion as of December 31, 2022, representing an increase of $126.6 million or 7.3% since September 30, 2022. The increase in assets was primarily due to higher net loans, which were funded by growth in deposits and an increase in wholesale borrowings. Loans HFI totaled $1.6 billion as of December 31, 2022, an increase of $100.9 million or 6.8% since September 30, 2022. Total deposits were $1.7 billion as of December 31, 2022, an increase of $144.5 million since September 30, 2022. Noninterest-bearing deposits represented 41.3% of total deposits as of December 31, 2022. Interest-bearing deposits grew $216.4 million from the prior quarter and included $61.6 million of callable brokered CDs. Additionally, as of December 31, 2022, the net unrealized loss on the available-for-sale investment securities portfolio, which is comprised mostly of US Treasury and Government Agency debt, was $14.4 million (pre-tax) compared to a loss of $15.2 million as of September 30, 2022. The average duration of the Bank’s investment securities portfolio is 4.7 years.

Asset Quality

As of December 31, 2022, the allowance for loan losses was $19.2 million or 1.21% of total loans HFI (excluding PPP loans), compared to 1.29% at September 30, 2022. The decrease in the coverage ratio was due to adjustments to the historical loss rate factors and qualitative factors which reflects the continuation of a sustained period of no charge-offs and low delinquencies. There were no net charge-offs (recoveries) during the quarter. Given the credit quality of the loan portfolio, management believes we are sufficiently reserved.

As of December 31, 2022, there are no doubtful credits and classified assets were $15.7 million, down from $15.9 million at September 30, 2022. Total classified assets at December 31, 2022 consisted of 13 loans, of which 7 loans totaling $10.0 million were secured by real estate with a weighted average LTV of 46%. The remaining 6 loans included 5 SBA loans with a balance of $3.2 million where 3 loans were 75% and 2 were 90% guaranteed by the SBA.

Capital Ratios (1)

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

	Dec 31, 2022 (1)	Dec 31, 2021
CalPrivate Bank
Tier I leverage ratio	9.52%	9.27%
Tier I risk-based capital ratio	10.10%	11.63%
Total risk-based capital ratio	11.35%	12.88%

      (1)   December 31, 2022, 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. 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 press release includes forward-looking statements that involve inherent risks and uncertainties. Private Bancorp of America, Inc. cautions readers that a number of important factors could cause actual results to differ materially from those in the forward‐looking statements. These factors include the effects of the COVID-19 pandemic and related government actions on the Bank and its customers, loan losses, economic conditions and competition in the geographic and business areas in which Private Bancorp of America, Inc. operates, our ability to successfully integrate and develop business through the addition of new personnel and facilities and merged banks, whether our efforts to expand loan, product and service offerings will prove profitable, the effects of the bank mergers and acquisitions in our markets, system failures and internet security, 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.

PRIVATE BANCORP OF AMERICA, INC.
CONSOLIDATED BALANCE SHEET
(Unaudited)
(Dollars in thousands)
	December 31, 2022				September 30, 2022				December 31, 2021
Assets
Cash and due from banks	$	14,495			$	13,506			$	12,336
Interest-bearing deposits in other financial institutions		32,175				44,776				39,663
Interest-bearing deposits at Federal Reserve Bank		83,738				43,891				97,086
Total cash and due from banks		130,408				102,173				149,085
Interest-bearing time deposits with other institutions		6,157				6,157				5,760
Investment securities available for sale		104,652				107,332				102,066
Loan held for sale		6,981				7,789				24,658
Total loans held-for-investment		1,587,960				1,487,098				1,224,158
Allowance for loan losses		(19,152	)			(19,092	)			(16,974	)
Net loans		1,568,808				1,468,006				1,207,184
Federal Home Loan Bank stock, at cost		7,020				7,020				4,909
Right of use asset		3,265				2,669				3,759
Premises and equipment, net		1,742				2,040				2,294
Servicing assets, net		3,007				3,502				3,079
Accrued interest receivable		5,291				4,262				3,355
Other assets		16,180				15,951				10,935
Total assets	$	1,853,511			$	1,726,901			$	1,517,084
Liabilities and Shareholders' Equity
Liabilities
Noninterest bearing	$	691,392			$	763,227			$	682,589
Interest Bearing		983,730				767,371				663,074
Total deposits		1,675,122				1,530,598				1,345,663
FHLB borrowings		-				30,000				10,000
Other borrowings		17,954				17,952				17,947
Accrued interest payable and other liabilities		17,111				13,417				15,110
Total liabilities		1,710,187				1,591,967				1,388,720
Shareholders' equity
Common stock		72,221				71,671				70,850
Additional paid-in capital		3,353				3,568				3,343
Retained earnings		77,810				70,386				54,922
Accumulated other comprehensive (loss) income, net		(10,060	)			(10,691	)			(751	)
Total shareholders' equity		143,324				134,934				128,364
Total liabilities and shareholders' equity	$	1,853,511			$	1,726,901			$	1,517,084

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
		December 31, 2022			September 30, 2022			December 31, 2021			December 31, 2022			December 31, 2021
Interest Income
Loans		$	24,717		$	21,028		$	16,941		$	80,922		$	61,806
Investment securities			592			578			352			2,143			1,338
Deposits in other financial institutions			756			372			63			1,467			221
Total interest income			26,065			21,978			17,356			84,532			63,365
Interest Expense
Deposits			3,149			1,011			353			4,897			1,689
Borrowings			320			364			314			1,311			2,885
Total interest expense			3,469			1,375			667			6,208			4,574
Net interest income			22,596			20,603			16,689			78,324			58,791
Provision for loan losses			60			1,316			834			2,178			2,713
Net interest income after provision for loan losses			22,536			19,287			15,855			76,146			56,078
Noninterest income:
Service charges on deposit accounts			274			306			254			1,160			945
Net gain on sale of loans			792			647			3,670			4,678			9,309
Other noninterest income			6			452			348			1,190			1,084
Total noninterest income			1,072			1,405			4,272			7,028			11,338
Noninterest expense:
Compensation and employee benefits			8,482			7,261			6,802			30,430			24,278
Occupancy and equipment			819			756			741			3,106			3,855
Data processing			942			993			703			3,411			2,827
Professional services			1,018			1,493			843			5,261			2,837
Other expenses			1,814			1,224			1,068			6,036			3,756
Total noninterest expense			13,075			11,727			10,157			48,244			37,553
Income before provision for income taxes			10,533			8,965			9,970			34,930			29,863
Provision for income taxes			3,102			2,614			2,891			10,233			8,833
Net income		$	7,431		$	6,351		$	7,079		$	24,697		$	21,030
Net income available to common shareholders		$	7,383		$	6,306		$	7,002		$	24,495		$	20,746
Earnings per share
Basic earnings per share		$	1.33		$	1.14		$	1.26		$	4.40		$	3.75
Diluted earnings per share		$	1.31		$	1.12		$	1.24		$	4.33		$	3.69
Average shares outstanding			5,561,376			5,549,480			5,547,422			5,561,358			5,535,581
Diluted average shares outstanding			5,655,355			5,640,841			5,638,186			5,658,434			5,617,017

PRIVATE BANCORP OF AMERICA, INC.
Consolidated average balance sheet, interest, yield and rates
(Unaudited)
(Dollars in thousands)
		For the three months ended
		December 31, 2022									September 30, 2022									December 31, 2021
		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		$	91,324		$	756		3.28	%		$	77,353		$	372		1.91	%		$	171,279		$	63		0.15	%
Investment securities			114,390			592		2.07	%			122,184			578		1.89	%			96,722			351		1.44	%
Loans, including LHFS			1,527,863			24,717		6.42	%			1,438,489			21,028		5.80	%			1,222,234			16,942		5.50	%
Total interest-earning assets			1,733,577			26,065		5.97	%			1,638,026			21,978		5.32	%			1,490,235			17,356		4.62	%
Noninterest-earning assets			25,627									27,465									24,348
Total Assets		$	1,759,204								$	1,665,491								$	1,514,583
Interest-Bearing Liabilities
Interest-bearing transaction accounts		$	141,030		$	295		0.83	%		$	92,986		$	166		0.71	%		$	74,158		$	14		0.07	%
Money market			597,670			1,674		1.11	%			535,473			680		0.50	%			504,171			202		0.16	%
Savings deposits			13,444			18		0.53	%			13,437			8		0.24	%			10,602			3		0.11	%
Certificates of deposit			101,202			1,162		4.56	%			69,676			157		0.89	%			68,408			134		0.78	%
Total Interest-Bearing Deposits			853,346			3,149		1.46	%			711,572			1,011		0.56	%			657,339			353		0.21	%
FHLB advances			12,195			112		3.64	%			15,299			92		2.39	%			10,000			42		1.67	%
Other borrowings			18,063			208		4.57	%			17,951			272		6.06	%			17,945			272		6.01	%
Total Interest-Bearing Liabilities			30,258			320		4.20	%			33,250			364		4.34	%			27,945			314		4.46	%
Noninterest-bearing deposits			720,656									771,167									689,438
Total Funding Sources			1,604,260			3,469		0.86	%			1,515,989			1,375		0.36	%			1,374,722			667		0.19	%
Noninterest-bearing liabilities			13,614									4,775									12,474
Shareholders' equity			141,330									144,727									127,387
Total Liabilities and Shareholders' Equity		$	1,759,204								$	1,665,491								$	1,514,583
Net interest income/spread					$	22,596		5.11	%					$	20,603		4.96	%					$	16,689		4.43	%
Net interest margin								5.17	%								4.99	%								4.44	%

PRIVATE BANCORP OF AMERICA, INC.
Consolidated average balance sheet, interest, yield and rates
(Unaudited)
(Dollars in thousands)
		Year to Date
		December 31, 2022									December 31, 2021
		Average Balance			Interest			Average Yield/Rate			Average Balance			Interest			Average Yield/Rate
Interest-Earnings Assets:
Deposits in other financial institutions		$	96,277		$	1,467		1.52	%		$	172,268		$	221		0.13	%
Investment securities			117,870			2,143		1.82	%			84,261			1,338		1.59	%
Loans			1,394,369			80,922		5.80	%			1,145,320			61,806		5.40	%
Total interest-earning assets			1,608,516			84,532		5.26	%			1,401,849			63,365		4.52	%
Noninterest-earning assets			25,719									21,115
Total Assets		$	1,634,235								$	1,422,964
Interest-Bearing Liabilities
Interest-bearing transaction accounts		$	100,216		$	530		0.53	%		$	66,575		$	50		0.08	%
Money market			531,317			2,789		0.52	%			463,595			915		0.20	%
Savings deposits			13,654			33		0.24	%			9,564			10		0.10	%
Certificates of deposit			76,717			1,545		2.01	%			78,193			714		0.91	%
Total Interest-Bearing Deposits			721,904			4,897		0.68	%			617,927			1,689		0.27	%
FHLB advances			11,889			288		2.42	%			34,521			1,798		5.21	%
Other borrowings			17,978			1,023		5.69	%			17,943			1,087		6.06	%
Total Interest-Bearing Liabilities			29,867			1,311		4.39	%			52,464			2,885		5.50	%
Noninterest-bearing deposits			733,313									621,042
Total Funding Sources			1,485,084			6,208		0.42	%			1,291,433			4,574		0.35	%
Noninterest-bearing liabilities			13,120									13,180
Shareholders' equity			136,031									118,351
Total Liabilities and Shareholders' Equity		$	1,634,235								$	1,422,964
Net interest income/spread					$	78,324		4.84	%					$	58,791		4.17	%
Net interest margin								4.87	%								4.19	%

	PRIVATE BANCORP OF AMERICA, INC.
	Condensed Balance Sheets
	(Unaudited)
	(Dollars in thousands, except per share amounts)
	Dec 31, 2022				Sep 30, 2022				Jun 30, 2022				Mar 31, 2022				Dec 31, 2021
Assets
Cash and due from banks	$	130,408			$	102,173			$	88,792			$	124,015			$	149,085
Interest-bearing time deposits with other institutions		6,157				6,157				6,157				5,817				5,760
Investment securities		104,652				107,332				113,565				114,382				102,066
Loans held for sale		6,981				7,789				4,460				1,999				24,658
Total loans held-for-investment (excluding PPP loans)		1,586,681				1,485,749				1,376,801				1,276,043				1,188,634
SBA PPP loans		1,279				1,349				2,718				8,795				35,524
Allowance for loan losses		(19,152	)			(19,092	)			(17,776	)			(17,117	)			(16,974	)
Net loans		1,568,808				1,468,006				1,361,743				1,267,721				1,207,184
Right of use asset		3,265				2,669				3,037				3,400				3,759
Premises and equipment, net		1,742				2,040				2,640				2,813				2,294
Other assets and interest receivable		31,498				30,735				31,708				25,335				22,278
Total assets	$	1,853,511			$	1,726,901			$	1,612,102			$	1,545,482			$	1,517,084
Liabilities and Shareholders' Equity
Liabilities
Noninterest Bearing	$	691,392			$	763,227			$	747,006			$	724,469			$	682,589
Interest Bearing		983,730				767,371				693,646				646,545				663,074
Total Deposits		1,675,122				1,530,598				1,440,652				1,371,014				1,345,663
Borrowings		17,954				47,952				27,950				27,948				27,947
Accrued interest payable and other liabilities		17,111				13,417				13,305				14,630				15,110
Total liabilities		1,710,187				1,591,967				1,481,907				1,413,592				1,388,720
Shareholders' equity
Common stock		72,221				71,671				71,516				70,899				70,850
Additional paid-in capital		3,353				3,568				3,368				3,602				3,343
Retained earnings		77,810				70,386				64,036				61,424				54,922
Accumulated other comprehensive (loss) income		(10,060	)			(10,691	)			(8,725	)			(4,035	)			(751	)
Total shareholders' equity		143,324				134,934				130,195				131,890				128,364
Total liabilities and shareholders' equity	$	1,853,511			$	1,726,901			$	1,612,102			$	1,545,482			$	1,517,084
Book value per common share	$	25.55			$	24.12			$	23.31			$	23.42			$	22.81
Tangible book value per common share	$	25.02			$	23.51			$	22.68			$	22.80			$	22.26
Shares outstanding		5,609,025				5,594,380				5,584,465				5,630,993				5,627,735

	PRIVATE BANCORP OF AMERICA, INC.
	Condensed Statements of Income
	(Unaudited)
	(Dollars in thousands, except per share amounts)
	For the three months ended
	Dec 31, 2022				Sep 30, 2022				Jun 30, 2022				Mar 31, 2022				Dec 31, 2021
Interest income	$	26,065			$	21,978			$	18,706			$	17,781			$	17,356
Interest expense		3,469				1,375				723				640				667
Net interest income		22,596				20,603				17,983				17,141				16,689
Provision for loan losses		60				1,316				659				142				834
Net interest income after provision for loan losses		22,536				19,287				17,324				16,999				15,855
Noninterest income		1,072				1,405				1,442				3,109				4,272
Compensation and employee benefits		8,482				7,261				7,374				7,313				6,802
Occupancy and equipment		819				756				808				723				741
Data processing		942				993				824				653				703
Professional services		1,018				1,493				1,835				915				843
Other expenses		1,814				1,224				1,759				1,239				1,068
Total noninterest expense		13,075				11,727				12,600				10,843				10,157
Income before provision for income taxes		10,533				8,965				6,166				9,265				9,970
Income taxes		3,102				2,614				1,769				2,747				2,891
Net income	$	7,431			$	6,351			$	4,397			$	6,518			$	7,079
Net income available to common shareholders	$	7,383			$	6,306			$	4,347			$	6,448			$	7,002
Earnings per share
Basic earnings per share	$	1.33			$	1.14			$	0.78			$	1.16			$	1.26
Diluted earnings per share	$	1.31			$	1.12			$	0.77			$	1.14			$	1.24
Average shares outstanding		5,561,376				5,549,480				5,543,065				5,568,400				5,547,422
Diluted average shares outstanding		5,655,355				5,640,841				5,639,282				5,672,701				5,638,186
	Performance Ratios
	Dec 31, 2022				Sep 30, 2022				Jun 30, 2022				Mar 31, 2022				Dec 31, 2021
ROAA		1.68	%			1.51	%			1.11	%			1.74	%			1.91	%
ROAE		20.86	%			17.41	%			13.28	%			19.95	%			22.72	%
ROATCE (1)		21.37	%			17.85	%			13.64	%			20.48	%			23.25	%
Net interest margin		5.17	%			4.99	%			4.61	%			4.65	%			4.44	%
Net interest spread		5.11	%			4.96	%			4.60	%			4.63	%			4.43	%
Efficiency ratio (1)		55.24	%			53.29	%			64.86	%			53.55	%			48.46	%
Noninterest expense / average assets		2.95	%			2.79	%			3.17	%			2.90	%			2.66	%
(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, 2022				Sep 30, 2022				Jun 30, 2022				Mar 31, 2022				Dec 31, 2021
Total assets	$	1,759,204			$	1,665,491			$	1,592,276			$	1,516,352			$	1,514,583
Earning assets	$	1,733,577			$	1,638,026			$	1,564,662			$	1,494,850			$	1,490,235
Total loans, including loans held for sale	$	1,527,863			$	1,438,489			$	1,339,095			$	1,268,695			$	1,222,234
Total deposits	$	1,574,002			$	1,482,740			$	1,419,648			$	1,341,631			$	1,346,777
Total shareholders' equity	$	141,330			$	144,727			$	132,789			$	132,472			$	127,387
	Loan Balances by Type
	(Dollars in thousands)
	Dec 31, 2022				Sep 30, 2022				Jun 30, 2022				Mar 31, 2022				Dec 31, 2021
Real estate - investor owned	$	476,404			$	403,950			$	390,628			$	350,152			$	324,167
Real estate - owner occupied		394,077				382,689				359,270				371,840				339,081
Real estate - multifamily		130,901				136,841				121,693				105,964				97,285
Real estate - single family		118,502				107,728				94,212				89,630				86,400
Commercial business		404,640				393,020				359,692				307,421				294,950
SBA PPP loans		1,279				1,349				2,718				8,795				35,524
Land and construction		56,153				55,418				44,856				44,856				39,702
Consumer		6,004				6,103				6,450				6,180				7,049
Total loans held for investment	$	1,587,960			$	1,487,098			$	1,379,519			$	1,284,838			$	1,224,158
	Deposits by Type
	(Dollars in thousands)
	Dec 31, 2022				Sep 30, 2022				Jun 30, 2022				Mar 31, 2022				Dec 31, 2021
Non interest bearing DDA	$	691,392			$	763,227			$	747,006			$	724,469			$	682,589
Interest bearing DDA		174,248				95,677				93,405				75,904				81,788
Savings & MMA		655,052				591,408				533,145				503,552				513,070
Retail CD		3,486				3,478				3,387				3,384				5,281
Jumbo CD		150,944				76,808				63,709				63,705				62,935
Total deposits	$	1,675,122			$	1,530,598			$	1,440,652			$	1,371,014			$	1,345,663
	Asset Quality
	(Dollars in thousands)
	Dec 31, 2022				Sep 30, 2022				Jun 30, 2022				Mar 31, 2022				Dec 31, 2021
Total loans held-for-investment	$	1,587,960			$	1,487,098			$	1,379,519			$	1,284,838			$	1,224,158
Allowance for Loan Losses	$	(19,152	)		$	(19,092	)		$	(17,776	)		$	(17,117	)		$	(16,975	)
30-89 day past due loans	$	-			$	-			$	-			$	-			$	-
90+ day past due loans	$	-			$	-			$	-			$	-			$	-
Nonaccrual loans	$	3,880			$	4,593			$	1,453			$	1,453			$	1,510
NPAs / Assets		0.21	%			0.27	%			0.09	%			0.09	%			0.10	%
NPLs / Total loans held-for-investment & OREO		0.24	%			0.31	%			0.11	%			0.11	%			0.12	%
Net quarterly charge-offs	$	-			$	-			$	-			$	-			$	-
Net charge-offs/avg loans (annualized)		0.00	%			0.00	%			0.00	%			0.00	%			0.00	%
Allowance for loan losses to loans HFI		1.21	%			1.28	%			1.29	%			1.33	%			1.39	%
Allowance for loan losses to nonaccrual loans		493.61	%			415.68	%			1,223.4	%			1,178.05	%			1,124.11	%

PRIVATE BANCORP OF AMERICA, INC.
(Unaudited)
The following tables present a reconciliation of non-GAAP financial measures to GAAP measures for: efficiency ratio, pretax pre-provision net revenue, average tangible common equity, 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, 2022				Sep 30, 2022				Jun 30, 2022				Mar 31, 2022				Dec 31, 2021
Efficiency Ratio
Noninterest expense	$	13,075			$	11,727			$	12,600			$	10,843			$	10,157
Net interest income		22,596				20,603				17,983				17,141				16,689
Noninterest income		1,072				1,405				1,442				3,109				4,272
Total net interest income and noninterest income		23,668				22,008				19,425				20,250				20,961
Efficiency ratio (non-GAAP)		55.2	%			53.3	%			64.9	%			53.5	%			48.5	%
Pretax pre-provision net revenue
Net interest income	$	22,596			$	20,603			$	17,983			$	17,141			$	16,689
Noninterest income		1,072				1,405				1,442				3,109				4,272
Total net interest income and noninterest income		23,668				22,008				19,425				20,250				20,961
Less: Noninterest expense		13,075				11,727				12,600				10,843				10,157
Pretax pre-provision net revenue (non-GAAP)	$	10,593			$	10,281			$	6,825			$	9,407			$	10,804
Return on Average Assets, Average Equity, Average Tangible Equity
Net income	$	7,431			$	6,351			$	4,397			$	6,518			$	7,079
Average assets		1,759,204				1,665,491				1,592,276				1,516,352				1,514,583
Average shareholders' equity		141,330				144,727				132,789				132,472				127,387
Less: Average intangible assets		3,385				3,599				3,490				3,379				2,908
Average tangible common equity (non-GAAP)		137,945				141,128				129,299				129,093				124,479
Return on average assets		1.68	%			1.51	%			1.11	%			1.74	%			1.91	%
Return on average equity		20.86	%			17.41	%			13.28	%			19.95	%			22.72	%
Return on average tangible common equity (non-GAAP)		21.37	%			17.85	%			13.64	%			20.48	%			23.25	%
Tangible book value per share
Total equity		143,324				134,934				130,195				131,890				128,364
Less: Total intangible assets		3,007				3,502				3,525				3,079				2,374
Total tangible equity		140,317				131,432				126,670				128,811				125,990
Shares outstanding		5,609,025				5,594,380				5,584,465				5,630,993				5,627,735
Tangible book value per share (non-GAAP)	$	25.02			$	23.49			$	22.68			$	22.88			$	22.39

PRIVATE BANCORP OF AMERICA, INC.
(Unaudited)
The following tables present a reconciliation of non-GAAP financial measures to GAAP measures for: efficiency ratio, pretax pre-provision net revenue, average tangible common equity, 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, 2022				Dec 31, 2021
Efficiency Ratio
Noninterest expense	$	48,244			$	37,553
Net interest income		78,324				58,791
Noninterest income		7,028				11,338
Total net interest income and noninterest income		85,352				70,129
Efficiency ratio (non-GAAP)		56.5	%			53.5	%
Pretax pre-provision net revenue
Net interest income	$	78,324			$	58,791
Noninterest income		7,028				11,338
Total net interest income and noninterest income		85,352				70,129
Less: Noninterest expense		48,244				37,553
Pretax pre-provision net revenue (non-GAAP)	$	37,108			$	32,576
Return on Average Assets, Average Equity, Average Tangible Equity
Net income	$	24,697			$	21,030
Average assets		1,634,235				1,422,964
Average shareholders' equity		136,031				118,351
Less: Average intangible assets		3,464				2,194
Average tangible common equity(3)		132,567				116,157
Return on average assets		1.51	%			1.48	%
Return on average equity		18.16	%			17.77	%
Return on average tangible common equity(non-GAAP)		18.63	%			18.10	%

FAQ

What were the earnings results for PBAM in Q4 2022?

PBAM reported net income of $7.4 million for Q4 2022, with a diluted EPS of $1.31.

How did PBAM perform in FY 2022?

In FY 2022, PBAM achieved net income of $24.7 million, up 17.4% from the previous year.

What is the outlook for PBAM after the recent financial results?

PBAM remains optimistic about future growth despite rising funding costs and increased competition for deposits.

What was the noninterest income trend for PBAM in Q4 2022?

Noninterest income for Q4 2022 was $1.1 million, down $333,000 from the previous quarter.