Peapack-Gladstone Bank Announces Sale of Paycheck Protection Program Loans

Rhea-AI Summary

Peapack-Gladstone Bank has sold $354.9 million in Paycheck Protection Program loans to The Loan Source, Inc., anticipating a pre-tax gain of approximately $7.4 million for the current quarter. Post-sale, the bank will retain around $203.5 million in PPP loans, with most exceeding $2 million in original principal. This strategic move aims to enable a return to normal operations, allowing staff to focus on traditional lending while leveraging The Loan Source’s expertise in loan servicing.

Positive

• Sale of $354.9 million in PPP loans expected to yield a pre-tax gain of $7.4 million.
• Retention of $203.5 million in PPP loans, primarily exceeding $2 million, indicating a strong loan portfolio.
• Collaboration with The Loan Source enables effective loan forgiveness processing.

Negative

• None.

Bedminster, NJ, Sept. 03, 2020 (GLOBE NEWSWIRE) -- via NEWMEDIAWIRE -- Peapack-Gladstone Bank, the wholly owned subsidiary of Peapack-Gladstone Financial Corporation (NASDAQ Global Select Market: PGC), announced the sale of $354.9 million of Paycheck Protection Program loans to The Loan Source, Inc.  The Bank expects to realize a pre-tax gain of approximately $7.4 million in the current quarter as a result of the sale.  After giving effect to the sale, Peapack-Gladstone Bank will hold approximately $203.5 million of Paycheck Protection Loans, almost all of which exceed $2.0 million in original principal amount.

“Our employees worked around the clock to process thousands of PPP loan applications over the past few months,” stated Doug Kennedy, President and CEO. “It’s been a tremendous effort, and now it’s time to continue helping our clients navigate the economic impact of COVID-19 by partnering with a long-standing and respected SBA small business lending company, with deep knowledge and focus on PPP, to take over the forgiveness and ongoing servicing process. We expect the sale of the PPP loans to allow a return to a more normal course of business, freeing up staff to focus on traditional lending efforts and providing excellent service to our clients.”

The Loan Source and its servicing partner, ACAP SME, LLC, have invested heavily in technologies and personnel to aid PPP borrowers through the forgiveness process via an online portal. 

ABOUT PEAPACK-GLADSTONE BANK

Founded in 1921, Peapack-Gladstone Financial Corporation is a New Jersey bank holding company with total assets of $6.3 billion, and wealth management assets under management and/or administration of $7.2 billion as of June 30, 2020.  Peapack-Gladstone Bank is a commercial bank that provides innovative wealth management, commercial and retail solutions, including residential lending and online platforms, to businesses and consumers.  For over four generations, Peapack Private, the Bank’s wealth management division, has offered comprehensive financial, tax, fiduciary and investment advice and solutions, to individuals, families, privately held businesses, family offices and not-for-profit organizations, which help them establish, maintain and expand their legacy.  Together, Peapack-Gladstone Bank and Peapack Private offer an unparalleled commitment to client service.  Visit www.pgbank.com and www.peapackprivate.com for more information.

FORWARD-LOOKING STATEMENTS

This press release may include forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Such statements are not historical facts and include expressions about management's confidence and strategies and management’s expectations about new and existing programs and products, investments, relationships, opportunities and market conditions. These statements may be identified by such forward-looking terminology as “expect,” “look,” “believe,” “anticipate,” “may” or similar statements or variations of such terms. Actual results may differ materially from such forward-looking statements. These forward-looking statements are subject to a variety of risks and uncertainties that could cause the actual results to differ materially from those described in this press release. You should not rely on forward-looking statements as a prediction of future events. 

Additional information regarding factors that could cause actual results to differ materially from those discussed in any forward-looking statements are described in reports and registration statements we file with the SEC, including our Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, copies of which can be obtained without charge by visiting the SEC’s website at www.sec.gov. 

Peapack disclaims any obligation to update any forward-looking statements or any changes in events, conditions or circumstances upon which any forward-looking statement may be based except as required by law.

Denise M. Pace-Sanders, Senior Vice President Brand and Marketing Director, dpace@pgbank.com, 908.470.3322, Peapack-Gladstone Bank, 500 Hills Drive, Suite 300, Bedminster, NJ 07921.

FAQ

What is the financial impact of Peapack-Gladstone Bank's PPP loan sale on Q3 2020?

Peapack-Gladstone Bank expects a pre-tax gain of approximately $7.4 million from the sale of $354.9 million in PPP loans.

How much PPP loans will Peapack-Gladstone Bank retain after the sale?

After the sale, Peapack-Gladstone Bank will retain approximately $203.5 million in PPP loans.

Which company purchased the PPP loans from Peapack-Gladstone Bank?

The PPP loans were sold to The Loan Source, Inc.

What is the significance of the PPP loan sale for Peapack-Gladstone Bank's operations?

The sale allows Peapack-Gladstone Bank to return to normal operations and focus on traditional lending efforts.