Plumas Bancorp Reports Second Quarter 2024 Earnings

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Plumas Bancorp's Q2 2024 financial report reveals a mixed bag of results for investors. The company's net income for the quarter increased modestly by $126 thousand compared to the same period last year, translating to $1.15 per share. This suggests the bank has managed to sustain its profitability despite challenging market conditions.

However, looking at the first six months of 2024, net income has decreased by $1.2 million compared to the same period in 2023. The decline in earnings per share from $2.44 to $2.21 could raise concerns among investors about the bank's ability to grow its profitability in the long term.

Return on average assets (ROA) and return on average equity (ROE) have both decreased slightly, indicating a dip in the bank's ability to generate profits from its assets and equity. Specifically, ROA decreased to 1.67% from 1.70% in the second quarter of 2023 and ROE dropped to 17.1% from 20.5% in the same period. These metrics are important as they measure the efficiency of the bank's management in using its resources.

On the balance sheet side, total equity witnessed a significant increase of $36.6 million, which is a positive indicator of the bank's financial health. Similarly, the book value per share rose by $6.09 to $28.01, which can be reassuring for investors as it reflects the bank's asset value stability.

In summary, while Plumas Bancorp has shown resilience in maintaining its quarterly profitability, the dip in half-year figures and key efficiency ratios suggest challenges. Investors should weigh these factors when assessing their investment strategy.

Plumas Bancorp's performance in Q2 2024 provides interesting insights into its market positioning. The increase in gross loans by 7% to $997 million highlights the bank's ongoing efforts to expand its lending activities, with notable growth in commercial real estate loans and construction loans. This indicates a strategy focused on sectors with potential for higher returns, albeit with associated risks.

However, the bank also reported a decrease in automobile loans and residential real estate loans, suggesting possible shifts in consumer borrowing behavior or strategic repositioning in these segments. The decline in total deposits by $91 million is notable, primarily attributed to the current interest rate environment. This trend could impact the bank's liquidity if not addressed through strategic initiatives.

The sales/leaseback transaction and restructuring of the investment portfolio, although resulting in a net gain, show the bank's proactive steps to manage its assets and liabilities. The shift to higher-yield investment securities and reduction in nonaccrual loans demonstrate prudent risk management, which is important in the current economic backdrop.

Lastly, the bank's inclusion in the Russell 2000 and multiple awards from industry bodies underscore its strong market reputation and operational performance. These recognitions could enhance investor confidence and stock liquidity, benefiting long-term shareholders.

Overall, while there are positive takeaways, the challenges in loan and deposit growth amidst a volatile interest rate environment should be closely monitored by investors.

The detailed disclosure regarding the sale and leaseback agreements of properties owned by Plumas Bank provides important context for investors. These transactions, including the completed sale of branch properties and the pending sale of non-branch administrative offices, have significant financial implications. The sale of properties for an aggregate cash purchase price of approximately $25.7 million and $7.9 million respectively, indicate a strategic move to unlock capital tied up in real estate assets.

Entering into triple net lease agreements with an initial term of 15 years plus renewal options suggests a long-term commitment to these locations without the burden of property ownership. While this ensures operational continuity, it also introduces an annual rent obligation of approximately $3.1 million, with a 2% annual increase. Investors should consider the long-term financial impact of these lease liabilities against the immediate benefit of capital inflow and the restructuring of the bank’s portfolio.

Furthermore, the bank's reporting of a net gain on the sale of branches offset by losses on investment securities sales reflects comprehensive transparency. This level of detail is important for assessing the true financial impact and the management's ability to navigate complex transactions.

In summary, these transactions provide liquidity and possibly improved operational efficiency but come with long-term lease obligations that must be considered in the broader financial strategy.

07/17/2024 - 09:00 AM

RENO, Nev., July 17, 2024 (GLOBE NEWSWIRE) -- Plumas Bancorp (Nasdaq:PLBC), the parent company of Plumas Bank, today announced earnings during the second quarter of 2024 of $6.8 million or $1.15 per share, an increase of $126 thousand from $6.7 million or $1.14 per share during the second quarter of 2023. Diluted earnings per share increased to $1.14 per share during the three months ended June 30, 2024 up from $1.12 per share during the quarter ended June 30, 2023.

For the six months ended June 30, 2024, the Company reported net income of $13.0 million or $2.21 per share, a decrease of $1.2 million from $14.3 million or $2.44 per share earned during the six months ended June 30, 2023. Earnings per diluted share decreased to $2.19 during the six months ended June 30, 2024, down $0.22 from $2.41 during the first six months of 2023.

Return on average assets was 1.67% during the current quarter, down slightly from 1.70% during the second quarter of 2023. Return on average equity decreased to 17.1% for the three months ended June 30, 2024, down from 20.5% during the second quarter of 2023. Return on average assets was 1.61% during the six months ended June 30, 2024, down from 1.81% during the first half of 2023. Return on average equity decreased to 16.7% for the six months ended June 30, 2024, down from 22.7% during the first half of 2023.

Balance Sheet Highlights
June 30, 2024 compared to June 30, 2023

Cash and due from banks increased by $18 million to $110 million.
Gross loans increased by $62 million, or 7%, to $997 million.
Total equity increased by $36.6 million, or 28%, to $165 million.
Book value per share increased by $6.09, or 28%, to $28.01.

President’s Comments

Andrew J. Ryback, director, president, and chief executive officer of Plumas Bancorp and Plumas Bank, stated, “During the second quarter, deposits stabilized. Our ability to maintain a low overall cost of funds remains a significant factor in driving profitability.

Loans continued to grow with strong SBA production. Currently our production is primarily fixed rate SBA 7(a) loans; however, when the market for variable rate product returns to more normal levels, we will return to making variable rate SBA 7(a) loans, the guaranteed portion of which we sell in the secondary market, enhancing non-interest income. We continue to refine CRE stress testing and closely monitor classified assets. Several significant reductions in nonaccrual loans have been achieved and concentrations remain within guidelines.

Increased yield on the restructured securities portfolio has more than offset the increase in rent expense resulting from the sale leaseback transaction completed in the first quarter. Additionally, unrealized losses in the securities portfolio continue to decline.

We are pleased to report that Plumas Bancorp has been included again in the Russell 2000 which reconstituted at the close of the second quarter. Inclusion will likely enhance stock liquidity via trading by index funds and benchmarked investment strategies.”

“Additionally,” continued Ryback, “Plumas Bank recently received several awards including:

Raymond James Bankers Cup
Independent Community Bankers of America Top-Performing Bank
Keefe, Bruyette & Woods Bank Honor Roll
American Banker Top-Performing Community Banks
D.A. Davidson Bison Select
Findley Reports Super Premier Performing Bank
CB-Resource Top Ten

Each of these awards assesses performance in a diversity of metrics compared with peer institutions. Our efforts to proactively manage earnings, expenses, and margins in a turbulent environment have allowed us to continue to achieve strong results.”

Sales/Leaseback and Investment Restructuring

On January 19, 2024, Plumas Bank entered into two agreements for the purchase and sale of real property (the “Sale Agreements”). One Sale Agreement provided for the sale to MountainSeed of nine properties owned and operated by Plumas Bank as branches (the “Branches”) for an aggregate cash purchase price of approximately $25.7 million. The branch portion of the sale was completed on February 14, 2024 resulting in a net gain on sale of $19.9 million, recording of right-of-use assets totaling $22.3 million and recording a lease liability of $22.3 million. The second Sale Agreement provides for the sale to MountainSeed of up to three properties operated as non-branch administrative offices (the “Non-Branch Offices”) for an aggregate cash purchase price of $7.9 million, assuming all of the Non-Branch Offices are sold. The closing date on the Non-Branch Offices has been extended to September 16, 2024 and may be extended further.

Under the Sale Agreements, the parties agreed, concurrently with the closing of the sale of the properties, to enter into triple net lease agreements (the “Lease Agreements”) pursuant to which Plumas Bank will lease each of the properties sold. Each Lease Agreement will have an initial term of fifteen years with one 15-year renewal option. The Lease Agreements will provide for an annual rent of approximately $3.1 million in the aggregate for all Properties of which $2.4 million relates to the completed branch sale, increased by two percent (2%) per annum for each year during the initial Term. During the renewal term, the initial rent will be the basic rent during the last year of the initial term, increased by two percent (2%) per annum for each year during the renewal term.

The gain on sales of the branches was offset by losses on the sale of approximately $115 million in investment securities. During the three months ended March 31, 2024 we sold $115 million in investment securities having a weighted average tax equivalent yield of 2.24% recording a $19.8 million loss on the sales. Beginning in December 2023 and ending on March 27, 2024 we purchased $120 million in investments securities having a weighted average tax equivalent yield of 5.25%.

Loans, Deposits, Investments and Cash

Gross loans increased by $62 million, or 7%, from $935 million at June 30, 2023, to $997 million at June 30, 2024. Increases in loans included $71 million in commercial real estate loans, $12 million in construction loans, $6 million in commercial loans, and $2 million in equity lines of credit; these items were partially offset by a decrease of $22 million in automobile loans, $3 million in agricultural loans, $3 million in residential real estate loans and $1 million in other loans.

On June 30, 2024, approximately 75% of the Company's loan portfolio was comprised of variable rate loans. The rates of interest charged on variable rate loans are set at specific increments in relation to the Company's lending rate or other indexes such as the published prime interest rate or U.S. Treasury rates and vary with changes in these indexes. The frequency at which variable rate loans reprice can vary from one day to several years. Most of our commercial real estate portfolio reprices every five years. Approximately 72% of the variable rate loans are indexed to the five year T-Bill rate and reprice every five years. Loans indexed to the prime interest rate were approximately 25% of the Company’s variable rate loan portfolio; these loans reprice within one day to three months of a change in the prime rate.

Total deposits decreased by $91 million to $1.3 billion at June 30, 2024. The decrease in deposits includes decreases of $46 million in demand deposits, and $51 million in savings deposits. Partially offsetting these declines was a $6 million increase in time deposits. We attribute much of the decrease to the current interest rate environment as we have seen some deposits leave for higher rates and some customers reluctant to borrow to fund operating expenses and instead have drawn down their excess deposit balances. Beginning in April 2023, we began offering a time deposit promotion offering 7-month and 11-month time deposits at an interest rate of 4%. Effective June 30, 2023, we discontinued this promotion which generated $46 million in deposits. However, beginning in the fourth quarter of 2023 we allowed those customers who had promotional time deposits to renew those deposits at similar terms. At June 30, 2024, 51% of the Company’s deposits were in the form of non-interest-bearing demand deposits. The Company has no brokered deposits.

Total investment securities decreased by $24 million from $469 million at June 30, 2023, to $445 million at June 30, 2024. The Bank’s investment security portfolio consists of debt securities issued by US Government agencies, US Government sponsored agencies and municipalities. Cash and due from banks increased by $18 million from $92 million at June 30, 2023, to $110 million at June 30, 2024.

Asset Quality

Nonperforming assets (which are comprised of nonperforming loans, other real estate owned (“OREO”) and repossessed vehicle holdings) at June 30, 2024 were $9.1 million, down from $9.6 million at June 30, 2023. Nonperforming assets as a percentage of total assets decreased to 0.56% at June 30, 2024 down from 0.61% at June 30, 2023. OREO increased by $58 thousand from $83 thousand at June 30, 2023 to $141 thousand at June 30, 2024. Nonperforming loans were $9.0 million at June 30, 2024 and $9.5 million at June 30, 2023. Included in nonperforming loans at June 30, 2024 were agricultural loans from one borrower totaling $6.2 million which were over 90 days past due but not nonaccrual. We received payments on these loans totaling $1.6 million in July and concurrently with these payments we extended the maturity of the loans to August 15, 2024 which allows time for the borrower to sell the crops securing the remaining balance of principal and interest on the loans. Nonaccrual loans totaled $2.5 million at June 30, 2024 and $4.5 million at June 30, 2023. Nonperforming loans as a percentage of total loans decreased to 0.90% at June 30, 2024, down from 1.02% at June 30, 2023.

During the first half of 2024 we recorded a provision for credit losses of $1.7 million consisting of a provision for credit losses on loans of $1.8 million and a decrease in the reserve for unfunded commitments of $79 thousand. The $1.8 million includes growth in the portfolio, net losses during the six-month period and an increase in loan delinquencies. This compares to a provision for credit losses of $2.9 million consisting of a provision for credit losses on loans of $2.6 million and an increase in the reserve for unfunded commitments of $325 thousand during the first six months of 2023.

Net charge-offs, mostly related to our automobile loan portfolio, totaled $610 thousand and $411 thousand during the six months ended June 30, 2024 and 2023, respectively. The allowance for credit losses totaled $14.1 million at June 30, 2024 and $13.4 million at June 30, 2023. The allowance for credit losses as a percentage of total loans was 1.41% and 1.43% at June 30, 2024 and 2023.

The following tables present the activity in the allowance for credit losses and the reserve for unfunded commitments during the six months ended June 30, 2024 and 2023 (in thousands).

Allowance for Credit Losses		June 30, 2024			June 30, 2023
Balance, beginning of period	$	12,867		$	10,717
Impact of CECL adoption		-			529
Provision charged to operations		1,825			2,550
Losses charged to allowance		(1,010	)		(738	)
Recoveries		400			327
Balance, end of period	$	14,082		$	13,385

Reserve for Unfunded Commitments		June 30, 2024			June 30, 2023
Balance, beginning of period	$	799		$	341
Impact of CECL adoption		-			258
Provision charged to operations		(79	)		325
Balance, end of period	$	720		$	924

Shareholders’ Equity

Total shareholders’ equity increased by $36.6 million from $128.6 million at June 30, 2023, to $165.2 million at June 30, 2024. The $36.6 million includes earnings during the twelve-month period totaling $28.5 million, a decrease in accumulated other comprehensive loss of $13.3 million and restricted stock and stock option activity totaling $0.9 million. These items were partially offset by the payment of cash dividends totaling $6.1 million.

Bank Term Funding Program

The Federal Reserve Board, on June 12, 2023, announced the creation of a new Bank Term Funding Program (BTFP). The BTFP offered loans of up to one year in length to banks, savings associations, credit unions, and other eligible depository institutions pledging U.S. Treasuries, agency debt and mortgage-backed securities, and other qualifying assets as collateral. These assets will be valued at par. At December 31, 2023, the Company had outstanding borrowings under the BTFP totaling $80 million. In January 2024 the Company borrowed an additional $25 million under the BTFP for a total of $105 million outstanding at June 30, 2024. This borrowing bears interest at the rate of 4.85% and is payable on January 17, 2025. Borrowings under the BTFP can be prepaid without penalty. There were no borrowings under the BTFP at June 30, 2023. Interest expense recognized on the BTFP borrowings for the six months ended June 30, 2024, totaled $2.5 million.

Liquidity

The Company manages its liquidity to provide the ability to generate funds to support asset growth, meet deposit withdrawals (both anticipated and unanticipated), fund customers' borrowing needs and satisfy maturity of short-term borrowings. The Company’s liquidity needs are managed using assets or liabilities, or both. On the asset side, in addition to cash and due from banks, the Company maintains an investment portfolio which includes unpledged U.S. Government-sponsored agency securities that are classified as available-for-sale. On the liability side, liquidity needs are managed by offering competitive offering rates on deposit products and the use of established lines of credit.

The Company is a member of the FHLB and can borrow up to $235 million from the FHLB secured by commercial and residential mortgage loans with carrying values totaling $431 million. In addition to its FHLB borrowing line, the Company has unsecured short-term borrowing agreements with two of its correspondent banks in the amounts of $50 million and $20 million. There were no outstanding borrowings from the FHLB or the correspondent banks at June 30, 2024 and June 30, 2023.

The Company estimates that it has approximately $423 million in uninsured deposits. Of this amount, $100 million represents deposits that are collateralized such as deposits of states, municipalities and tribal accounts.

Customer deposits are the Company’s primary source of funds. Total deposits decreased by $91 million from $1.4 billion at June 30, 2023 to $1.3 billion at June 30, 2024. Deposits are held in various forms with varying maturities.

The Company’s securities portfolio, Federal funds sold, FHLB advances, and cash and due from banks serve as the primary sources of liquidity, providing adequate funding for loans during periods of high loan demand. During periods of decreased lending, funds obtained from the maturing or sale of investments, loan payments, and new deposits are invested in short-term earning assets, such as cash held at the Federal Reserve Bank of San Fransisco, Federal funds sold and investment securities, to serve as a source of funding for future loan growth. Management believes that the Company’s available sources of funds, including borrowings, will provide adequate liquidity for its operations in the foreseeable future.

Net Interest Income and Net Interest Margin – Three Months Ended June 30, 2024

Net interest income was $18.4 million for the three months ended June 30, 2024, an increase of $1.2 million from the same period in 2023. The increase in net interest income includes an increase of $2.9 million in interest income partially offset by an increase of $1.8 million in interest expense. Interest and fees on loans increased by $2.0 million related to growth in the loan portfolio and an increase in yield on the portfolio.

Average loan balances increased by $61 million, while the average yield on these loans increased by 48 basis points from 5.84% during the second quarter of 2023 to 6.32% during the current quarter. The increase in loan yield includes the effect of an increase in market rates. The average prime interest rate increased from 8.16% during the second quarter of 2023 to 8.50% during the current quarter. Additionally, during the current quarter we recovered $316 thousand in interest on loans that were classified as nonaccrual and which were paid off in full during the quarter.

Interest on investment securities increased by $669 thousand related to an increase in yield of 86 basis points to 4.11%. The increase in investment yields is consistent with the increase in market rates and the restructuring of the investment portfolio discussed earlier. Average investment securities declined from $478 million during the three months ended June 30, 2023 to $444 million during the current quarter. Interest on cash balances increased by $249 thousand related to an increase in average balance of $13 million and an increase in rate earned on these balances of 37 basis points from 5.14% during the three months ended June 30, 2023 to 5.51% during the current quarter. The increase in rate earned was mostly related to an increase in the rate paid on balances held at the Federal Reserve Bank (FRB). The average rate earned on FRB balances increased from 5.06% during the second quarter of 2023 to 5.40% during the current quarter.

Interest expense increased from $984 thousand during the three months ended June 30, 2023 to $2.8 million during the current period related to an increase in rate paid on interest bearing liabilities and an increase in borrowings. The average rate paid on interest bearing liabilities increased from 0.56% during the 2023 quarter to 1.44% in 2024 related mainly to an increase in market interest rates, an increase in borrowings and the effect of a 4% time deposit promotion.

Interest paid on deposits increased by $452 thousand and is broken down by product type as follows: money market accounts - $130 thousand and time deposits - $356 thousand. Related to a decline in average balance of $61 million, interest on savings deposits declined by $34 thousand. The average rate paid on interest-bearing deposits increased from 0.51% during the second quarter of 2023 to 0.84% during the current quarter.

During the fourth quarter of 2023 we borrowed $80 million under the BTFP and during January 2024 we increased this borrowing by $25 million to a total of $105 million. Additionally, we increased Plumas Bancorp's borrowing on its line of credit to $15 million during the first quarter of 2024. Interest incurred on these borrowings totaled $1.4 million and $113 thousand during the three months ended June 30, 2024 and 2023, respectively.

Net interest margin for the three months ended June 30, 2024 increased 20 basis points to 4.89%, up from 4.69% for the same period in 2023.

Net Interest Income and Net Interest Margin – Six Months Ended June 30, 2024

Net interest income for the six months ended June 30, 2024 was $35.9 million, an increase of $1.5 million from the $34.4 million earned during the same period in 2023. The increase in net interest income includes an increase of $5.2 million in interest income partially offset by an increase of $3.7 million in interest expense.

Interest and fees on loans increased by $3.9 million related to an increase in average balance and yield. The average balance of loans during the six months ended June 30, 2024 was $972 million, an increase of $55 million from $917 million during the same period in 2023. The average yield on loans increased by 48 basis points from 5.73% during the first six months of 2023 to 6.21% during the current period.

Interest on investment securities increased by $1.3 million related to an increase in yield of 65 basis points to 3.89%. The increase in investment yields is consistent with the increase in market rates and the restructuring of the investment portfolio. Average investment securities declined from $472 million during the six months ended June 30, 2023 to $462 million during the current period. Interest on cash balances declined by $78 thousand as an increase in yield of 70 basis points was offset by a decline in average balance from $97.1 million during the first six months of 2023 to $81.8 million in the current period.

Interest expense increased from $1.6 million during the six months ended June 30, 2023 to $5.3 million during the current period related to an increase in rate paid on interest bearing liabilities and an increase in borrowings. The average rate paid on interest bearing liabilities increased from 0.46% during the 2023 period to 1.39% in 2024 related mainly to an increase in market interest rates, an increase in borrowings and the effect of a 4% time deposit promotion.

Interest paid on deposits increased by $1.2 million and is broken down by product type as follows: money market accounts - $289 thousand and time deposits - $935 thousand. Related to a decline in average balance of $64 million, interest on savings deposits declined by $53 thousand. The average rate paid on interest-bearing deposits increased from 0.39% during the six months ended June 30, 2023 to 0.79% during the current period.

Interest incurred on borrowings, including junior subordinated debentures in 2023 and borrowings under the BTFP in 2024, totaled $2.8 million and $282 thousand during the six months ended June 30, 2024 and 2023, respectively.

Net interest margin for the six months ended June 30, 2024 increased 10 basis points to 4.76%, up from 4.66% for the same period in 2023.

Non-Interest Income/Expense – Three Months Ended June 30, 2024

Non-interest income increased by $59 thousand to $2.2 million during the current quarter. Increases of $49 thousand in service charge income, $50 thousand in Federal Home Loan Bank dividends and $57 thousand in other non-interest income were partially offset by declines in interchange income of $42 thousand and loan servicing fees of $55 thousand.

During the three months ended June 30, 2024, total non-interest expense increased by $1.3 million from $9.1 million during the second quarter of 2023 to $10.4 million during the current quarter. The largest components of this increase were an increase in salary and benefit expense of $417 thousand and an increase in occupancy and equipment costs of $696 thousand. The increase in salary and benefit expense primarily relates to an increase in salary expense and commissions. Salary expense increased by $197 thousand which we attribute primarily to merit and promotional salary increases and an increase in employees. Our full time equivalent employee count has increased from 176 at June 30, 2023 to 185 at June 30, 2024. Commissions increased by $328 thousand related mostly to SBA production which has been quite strong during 2024. In the second half of 2023, our SBA department moved from producing variable rate SBA 7(a) loans indexed to prime to fixed rate SBA 7(a) loans. We had experienced a significant decline in the market for the variable rate SBA loans; however, we have successfully transitioned to the fixed rate product. We portfolio the fixed rate SBA loans we generate. During the three months ended June 30, 2024 fixed rate SBA loans balances increased by $20 million. Partially offsetting the increase in salary and commission expense was an increase in the deferral of loan origination cost of $254 thousand related to the increase in SBA loan production. Occupancy and equipment costs increased by $696 thousand related to an increase in rent expense of $685 thousand related to the sales/leaseback transaction.

Non-Interest Income/Expense – Six Months Ended June 30, 2024

During the six months ended June 30, 2024, non-interest income totaled $4.3 million, a decrease of $1.7 million from the six months ended June 30, 2023. The largest component of this decrease was a $1.7 million gain on termination of our interest rate swaps during the 2023 quarter. As discussed earlier, during the first quarter of 2024, a $19.9 million gain on sale of buildings was offset by a $19.8 million loss on investment securities.

During the six months ended June 30, 2024 non-interest expense increased by $2.5 million to $20.8 million. The largest components of this increase were a $716 thousand increase in salary and benefit expenses and a $1.0 million increase in occupancy and equipment expense. The largest increases in salary and benefit expense were $384 thousand in salary expense and $435 thousand in commission expense. These were partially offset by an increase in the deferral of loan origination costs of $392 thousand related to an increase in SBA production. The increase in occupancy and equipment costs relates to a $1.0 million increase in rent expense related to the sales/leaseback transaction.

Plumas Bancorp is headquartered in Reno, Nevada. Plumas Bancorp’s principal subsidiary is Plumas Bank, which was founded in 1980. Plumas Bank is a full-service community bank headquartered in Quincy, California. The bank operates fifteen branches: thirteen located in the California counties of Butte, Lassen, Modoc, Nevada, Placer, Plumas, Shasta and Sutter and two branches located in Nevada in the counties of Carson City and Washoe. The bank also operates two loan production offices located in Auburn, California and Klamath Falls, Oregon. Plumas Bank offers a wide range of financial and investment services to consumers and businesses and has received nationwide Preferred Lender status with the United States Small Business Administration. For more information on Plumas Bancorp and Plumas Bank, please visit our website at www.plumasbank.com.

This news release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act of 1934, as amended and Plumas Bancorp intends for such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Future events are difficult to predict, and the expectations described above are necessarily subject to risk and uncertainty that may cause actual results to differ materially and adversely.

Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words "believe," "expect," "anticipate," "intend," "plan," "estimate," or words of similar meaning, or future or conditional verbs such as "will," "would," "should," "could," or "may." These forward-looking statements are not guarantees of future performance, nor should they be relied upon as representing management's views as of any subsequent date. Forward-looking statements involve significant risks and uncertainties, and actual results may differ materially from those presented, either expressed or implied, in this news release. Factors that might cause such differences include, but are not limited to: the Company's ability to successfully execute its business plans and achieve its objectives; changes in general economic and financial market conditions, either nationally or locally in areas in which the Company conducts its operations; changes in interest rates; continuing consolidation in the financial services industry; new litigation or changes in existing litigation; increased competitive challenges and expanding product and pricing pressures among financial institutions; legislation or regulatory changes which adversely affect the Company's operations or business; loss of key personnel; and changes in accounting policies or procedures as may be required by the Financial Accounting Standards Board or other regulatory agencies.

Contact: Jamie Huynh
Investor Relations
Plumas Bancorp
5525 Kietzke Lane Ste. 100
Reno, NV 89511
775.786.0907 x8908
investorrelations@plumasbank.com

PLUMAS BANCORP
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
	As of June 30,
	2024	2023	Dollar Change	Percentage Change
ASSETS
Cash and due from banks	$ 109,852	$ 91,765	$ 18,087	19.7%
Investment securities	445,132	468,920	(23,788)	(5.1)%
Loans, net of allowance for credit losses	986,517	925,050	61,467	6.6%
Premises and equipment, net	12,868	19,377	(6,509)	(33.6)%
Bank owned life insurance	16,310	15,902	408	2.6%
Real estate acquired through foreclosure	141	83	58	69.9%
Goodwill	5,502	5,502	-	-%
Accrued interest receivable and other assets	65,775	46,386	19,389	41.8%
Total assets	$ 1,642,097	$ 1,572,985	$ 69,112	4.4%

LIABILITIES AND SHAREHOLDERS’ EQUITY
Deposits	$ 1,304,587	$ 1,395,160	$ (90,573)	(6.5)%
Accrued interest payable and other liabilities	52,355	39,267	13,088	33.3%
Borrowings	120,000	10,000	110,000	1100.0%
Total liabilities	1,476,942	1,444,427	32,515	2.3%
Common stock	28,656	27,739	917	3.3%
Retained earnings	161,608	139,191	22,417	16.1%
Accumulated other comprehensive loss, net	(25,109)	(38,372)	13,263	34.6%
Shareholders’ equity	165,155	128,558	36,597	28.5%
Total liabilities and shareholders’ equity	$ 1,642,097	$ 1,572,985	$ 69,112	4.4%


PLUMAS BANCORP
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
(Unaudited)

FOR THE THREE MONTHS ENDED JUNE 30,	2024	2023	Dollar Change	Percentage Change

Interest income	$ 21,160	$ 18,223	$ 2,937	16.1%
Interest expense	2,755	984	1,771	180.0%
Net interest income before provision for credit losses	18,405	17,239	1,166	6.8%
Provision for credit losses	925	1,350	(425)	(31.5)%
Net interest income after provision for credit losses	17,480	15,889	1,591	10.0%
Non-interest income	2,202	2,143	59	2.8%
Non-interest expense	10,396	9,098	1,298	14.3%
Income before income taxes	9,286	8,934	352	3.9%
Provision for income taxes	2,500	2,274	226	9.9%
Net income	$ 6,786	$ 6,660	$ 126	1.9%

Basic earnings per share	$ 1.15	$ 1.14	$ 0.01	0.9%
Diluted earnings per share	$ 1.14	$ 1.12	$ 0.02	1.8%


PLUMAS BANCORP
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
(Unaudited)

FOR THE SIX MONTHS ENDED JUNE 30,	2024	2023	Dollar Change	Percentage Change

Interest income	$ 41,187	$ 36,010	$ 5,177	14.4%
Interest expense	5,325	1,622	3,703	228.3%
Net interest income before provision for credit losses	35,862	34,388	1,474	4.3%
Provision for credit losses	1,746	2,875	(1,129)	(39.3)%
Net interest income after provision for credit losses	34,116	31,513	2,603	8.3%
Non-interest income	4,342	6,068	(1,726)	(28.4)%
Non-interest expense	20,793	18,323	2,470	13.5%
Income before income taxes	17,665	19,258	(1,593)	(8.3)%
Provision for income taxes	4,625	4,973	(348)	(7.0)%
Net income	$ 13,040	$ 14,285	$ (1,245)	(8.7)%

Basic earnings per share	$ 2.21	$ 2.44	$ (0.23)	(9.4)%
Diluted earnings per share	$ 2.19	$ 2.41	$ (0.22)	(9.1)%

PLUMAS BANCORP
SELECTED FINANCIAL INFORMATION
(Dollars in thousands, except per share data)
(Unaudited)

	Three Months Ended										Six Months Ended
	6/30/2024				3/31/2024			6/30/2023			6/30/2024			6/30/2023
EARNINGS PER SHARE
Basic earnings per share	$	1.15			$	1.06		$	1.14		$	2.21		$	2.44
Diluted earnings per share	$	1.14			$	1.05		$	1.12		$	2.19		$	2.41
Weighted average shares outstanding		5,896				5,887			5,862			5,892			5,858
Weighted average diluted shares outstanding		5,946				5,946			5,929			5,946			5,932
Cash dividends paid per share ¹	$	0.27			$	0.27		$	0.25		$	0.54		$	0.50

PERFORMANCE RATIOS (annualized for the three months)
Return on average assets		1.67		%		1.55	%		1.70	%		1.61	%		1.81	%
Return on average equity		17.1		%		16.4	%		20.5	%		16.7	%		22.7	%
Yield on earning assets		5.62		%		5.30	%		4.96	%		5.46	%		4.88	%
Rate paid on interest-bearing liabilities		1.44		%		1.33	%		0.56	%		1.39	%		0.46	%
Net interest margin		4.89		%		4.62	%		4.69	%		4.76	%		4.66	%
Noninterest income to average assets		0.54		%		0.53	%		0.55	%		0.54	%		0.77	%
Noninterest expense to average assets		2.56		%		2.57	%		2.32	%		2.57	%		2.33	%
Efficiency ratio ²		50.4		%		53.1	%		46.9	%		51.7	%		45.3	%

	6/30/2024				3/31/2024			6/30/2023			12/31/2023			12/31/2022
CREDIT QUALITY RATIOS AND DATA
Allowance for credit losses	$	14,082			$	13,157		$	13,385		$	12,867		$	10,717
Allowance for credit losses as a percentage of total loans		1.41	%			1.35	%		1.43	%		1.34	%		1.18	%
Nonperforming loans	$	8,974			$	5,610		$	9,535		$	4,820		$	1,172
Nonperforming assets	$	9,148			$	6,000		$	9,636		$	5,315		$	1,190
Nonperforming loans as a percentage of total loans		0.90	%			0.57	%		1.02	%		0.50	%		0.13	%
Nonperforming assets as a percentage of total assets		0.56	%			0.37	%		0.61	%		0.33	%		0.07	%
Year-to-date net charge-offs	$	610			$	610		$	411		$	954		$	935
Year-to-date net charge-offs as a percentage of average		0.13	%			0.25	%					0.10	%		0.11	%
loans (annualized)		0.13	%			0.25	%		0.09	%		0.10	%		0.11	%

CAPITAL AND OTHER DATA
Common shares outstanding at end of period		5,896				5,896			5,864			5,872			5,850
Shareholders' equity	$	165,155			$	161,491		$	128,558		$	147,317		$	119,004
Book value per common share	$	28.01			$	27.39		$	21.92		$	25.09		$	20.34
Tangible common equity³	$	158,763			$	155,048		$	121,947		$	140,823		$	112,273
Tangible book value per common share⁴	$	26.93			$	26.30		$	20.80		$	23.98		$	19.19
Tangible common equity to total assets		9.7	%			9.5	%		7.8	%		8.7	%		6.9	%
Gross loans to deposits		76.4	%			75.1	%		67.0	%		71.9	%		62.6	%

PLUMAS BANK REGULATORY CAPITAL RATIOS
Tier 1 Leverage Ratio		11.3	%			11.0	%		10.3	%		10.8	%		9.2	%
Common Equity Tier 1 Ratio		16.4	%			16.1	%		15.0	%		15.7	%		14.7	%
Tier 1 Risk-Based Capital Ratio		16.4	%			16.1	%		15.0	%		15.7	%		14.7	%
Total Risk-Based Capital Ratio		17.6	%			17.4	%		16.2	%		16.9	%		15.7	%

(1) The Company paid a quarterly cash dividend of $0.27 per share on May 15, 2024 and February 15, 2024 and a quarterly cash dividend of $0.25 per share on February 15, 2023, May 15, 2023 , August 15, 2023.
(2) Efficiency ratio is defined as noninterest expense divided by total revenue (net interest income and total noninterest income).
(3) Tangible common equity is defined as common equity less core deposit intangibles and goodwill.
(4) Tangible common book value per share is defined as tangible common equity divided by common shares outstanding.

PLUMAS BANCORP
SELECTED FINANCIAL INFORMATION
(Dollars in thousands)
(Unaudited)

The following table presents for the three-month periods indicated the distribution of consolidated average assets, liabilities and shareholders' equity.

	For the Three Months Ended						For the Three Months Ended
	6/30/2024						6/30/2023
	Average				Yield/		Average				Yield/
	Balance		Interest		Rate		Balance		Interest		Rate
Interest-earning assets:
Loans ^{(2) (3)}	$	980,723	$	15,412	6.32	%	$	919,953	$	13,393	5.84	%
Investment securities		367,841		3,932	4.30	%		351,986		2,938	3.35	%
Non-taxable investment securities⁽¹⁾		76,275		602	3.17	%		126,148		927	2.95	%
Interest-bearing deposits		88,607		1,214	5.51	%		75,233		965	5.14	%
Total interest-earning assets		1,513,446		21,160	5.62	%		1,473,320		18,223	4.96	%
Cash and due from banks		26,859						26,050
Other assets		90,092						74,888
Total assets	$	1,630,397					$	1,574,258

Interest-bearing liabilities:
Money market deposits		215,614		468	0.87	%		229,886		338	0.59	%
Savings deposits		322,919		174	0.22	%		383,599		208	0.22	%
Time deposits		94,684		674	2.86	%		67,986		318	1.88	%
Total deposits		633,217		1,316	0.84	%		681,471		864	0.51	%
Borrowings		120,000		1,431	4.80	%		10,000		113	4.53	%
Other interest-bearing liabilities		16,809		8	0.19	%		16,900		7	0.17	%
Total interest-bearing liabilities		770,026		2,755	1.44	%		708,371		984	0.56	%
Non-interest-bearing deposits		663,094						718,372
Other liabilities		37,794						17,411
Shareholders' equity		159,483						130,104
Total liabilities & equity	$	1,630,397					$	1,574,258
Cost of funding interest-earning assets ⁽⁴⁾					0.73	%					0.27	%
Net interest income and margin ⁽⁵⁾			$	18,405	4.89	%			$	17,239	4.69	%

(1) Not computed on a tax-equivalent basis.
(2) Average nonaccrual loan balances of $4.2 million for 2024 and $3.6 million for 2023 are included in average loan balances for computational purposes.
(3) Net costs included in loan interest income for the three-month periods ended June 30, 2024 and 2023 were $338 thousand and $231 thousand, respectively.
(4) Total annualized interest expense divided by the average balance of total earning assets.
(5) Annualized net interest income divided by the average balance of total earning assets.

PLUMAS BANCORP
SELECTED FINANCIAL INFORMATION
(Dollars in thousands)
(Unaudited)

The following table presents for the six-month periods indicated the distribution of consolidated average assets, liabilities
and shareholders' equity.

	For the Six Months Ended						For the Six Months Ended
	6/30/2024						6/30/2023
	Average				Yield/		Average				Yield/
	Balance		Interest		Rate		Balance		Interest		Rate
Interest-earning assets:
Loans ^{(2) (3)}	$	972,427	$	30,005	6.21	%	$	917,405	$	26,087	5.73	%
Investment securities		369,815		7,537	4.10	%		347,002		5,752	3.34	%
Non-taxable investment securities⁽¹⁾		92,225		1,393	3.04	%		125,388		1,841	2.96	%
Interest-bearing deposits		81,807		2,252	5.54	%		97,103		2,330	4.84	%
Total interest-earning assets		1,516,274		41,187	5.46	%		1,486,898		36,010	4.88	%
Cash and due from banks		26,722						26,386
Other assets		85,300						75,034
Total assets	$	1,628,296					$	1,588,318

Interest-bearing liabilities:
Money market deposits		213,399		844	0.80	%		232,855		555	0.48	%
Savings deposits		329,242		354	0.22	%		392,899		407	0.21	%
Time deposits		93,092		1,304	2.82	%		58,057		369	1.28	%
Total deposits		635,733		2,502	0.79	%		683,811		1,331	0.39	%
Borrowings		117,170		2,798	4.80	%		5,691		141	5.00	%
Junior subordinated debentures		-		-	-	%		4,575		141	6.22	%
Other interest-bearing liabilities		19,260		25	0.26	%		17,687		9	0.10	%
Total interest-bearing liabilities		772,163		5,325	1.39	%		711,764		1,622	0.46	%
Non-interest-bearing deposits		668,441						733,781
Other liabilities		31,118						15,908
Shareholders' equity		156,574						126,865
Total liabilities & equity	$	1,628,296					$	1,588,318
Cost of funding interest-earning assets ⁽⁴⁾					0.70	%					0.22	%
Net interest income and margin ⁽⁵⁾			$	35,862	4.76	%			$	34,388	4.66	%

(1) Not computed on a tax-equivalent basis.
(2) Average nonaccrual loan balances of $4.8 million for 2024 and $3.0 million for 2023 are included in average loan balances for computational purposes.
(3) Net costs included in loan interest income for the six-month periods ended June 30, 2024 and 2023 were $682 thousand and $581 thousand, respectively.
(4) Total annualized interest expense divided by the average balance of total earning assets.
(5) Annualized net interest income divided by the average balance of total earning assets.

PLUMAS BANCORP
SELECTED FINANCIAL INFORMATION
(Dollars in thousands)
(Unaudited)

The following table presents the components of non-interest income for the three-month
periods ended June 30, 2024 and 2023.

	For the Three Months Ended
	June 30,
		2024		2023	Dollar Change			Percentage Change
Interchange income	$	782	$	824		(42	)	(5.1	)%
Service charges on deposit accounts		743		694		49		7.1	%
Loan servicing fees		186		241		(55	)	(22.8	)%
FHLB Dividends		136		86		50		58.1	%
Earnings on life insurance policies		104		100		4		4.0	%
Other		251		198		53		26.8	%
Total non-interest income	$	2,202	$	2,143	$	59		2.8	%

The following table presents the components of non-interest expense for the three-month
periods ended June 30, 2024 and 2023.

	For the Three Months Ended
	June 30,
		2024		2023	Dollar Change			Percentage Change
Salaries and employee benefits	$	5,283	$	4,866	$	417		8.6	%
Occupancy and equipment		1,949		1,253		696		55.5	%
Outside service fees		1,184		1,181		3		0.3	%
Professional fees		329		284		45		15.8	%
Armored car and courier		220		182		38		20.9	%
Advertising and shareholder relations		214		281		(67	)	(23.8	)%
Business development		210		166		44		26.5	%
Telephone and data communication		204		203		1		0.5	%
Director compensation and expense		199		196		3		1.5	%
Deposit insurance		185		182		3		1.6	%
Loan collection expenses		117		87		30		34.5	%
Amortization of Core Deposit Intangible		51		60		(9	)	(15.0	)%
Other		251		157		94		59.9	%
Total non-interest expense	$	10,396	$	9,098	$	1,298		14.3	%

PLUMAS BANCORP
SELECTED FINANCIAL INFORMATION
(Dollars in thousands)
(Unaudited)

The following table presents the components of non-interest income for the six-month
periods ended June 30, 2024 and 2023.

	For the Six Months Ended
	June 30,
		2024			2023	Dollar Change			Percentage Change
Gain on sale of buildings	$	19,854		$	-		19,854		100.0	%
Interchange income		1,522			1,539		(17	)	(1.1	)%
Service charges on deposit accounts		1,458			1,313		145		11.0	%
Loan servicing fees		388			476		(88	)	(18.5	)%
FHLB Dividends		273			173		100		57.8	%
Earnings on life insurance policies		200			204		(4	)	(2.0	)%
Gain on termination of interest rate swaps		-			1,707		(1,707	)	(100.0	)%
Loss on sale of investment securities		(19,826	)		-		(19,826	)	100.0	%
Other		473			656		(183	)	(27.9	)%
Total non-interest income	$	4,342		$	6,068	$	(1,726	)	(28.4	)%

The following table presents the components of non-interest expense for the six-month
periods ended June 30, 2024 and 2023.

	For the Six Months Ended
	June 30,
		2024			2023	Dollar Change			Percentage Change
Salaries and employee benefits	$	10,649		$	9,933	$	716		7.2	%
Occupancy and equipment		3,639			2,593		1,046		40.3	%
Outside service fees		2,316			2,175		141		6.5	%
Professional fees		768			626		142		22.7	%
Advertising and shareholder relations		458			460		(2	)	(0.4	)%
Telephone and data communication		426			403		23		5.7	%
Armored car and courier		422			347		75		21.6	%
Deposit insurance		372			370		2		0.5	%
Director compensation and expense		366			438		(72	)	(16.4	)%
Business development		363			305		58		19.0	%
Loan collection expenses		221			217		4		1.8	%
Amortization of Core Deposit Intangible		102			120		(18	)	(15.0	)%
Other		691			336		355		105.7	%
Total non-interest expense	$	20,793		$	18,323	$	2,470		13.5	%

PLUMAS BANCORP
SELECTED FINANCIAL INFORMATION
(Dollars in thousands)
(Unaudited)

The following table shows the distribution of loans by type at June 30, 2024 and 2023.

			Percent of				Percent of
			Loans in Each				Loans in Each
	Balance at End		Category to		Balance at End		Category to
	of Period		Total Loans		of Period		Total Loans
	6/30/24		6/30/24		6/30/23		6/30/23
Commercial	$	81,170	8.1	%	$	74,958	8.0	%
Agricultural		123,661	12.4	%		126,841	13.6	%
Real estate – residential		11,755	1.2	%		14,878	1.6	%
Real estate – commercial		588,332	59.0	%		517,289	55.3	%
Real estate – construction & land		67,960	6.8	%		56,331	6.0	%
Equity Lines of Credit		38,446	3.9	%		35,877	3.8	%
Auto		80,751	8.1	%		103,050	11.0	%
Other		5,259	0.5	%		5,990	0.7	%
Total Gross Loans	$	997,334	100	%	$	935,214	100	%

The following table shows the distribution of Commercial Real Estate loans at June 30, 2024 and 2023.

			Percent of				Percent of
			Loans in Each				Loans in Each
	Balance at End		Category to		Balance at End		Category to
	of Period		Total Loans		of Period		Total Loans
	6/30/24		6/30/24		6/30/23		6/30/23
Owner occupied	$	240,346	40.9	%	$	166,439	32.2	%
Investor		347,986	59.1	%		350,850	67.8	%
Total real estate - commercial	$	588,332	100	%	$	517,289	100	%


The following table shows the distribution of deposits by type at June 30, 2024 and 2023.

			Percent of				Percent of
			Deposits in Each				Deposits in Each
	Balance at End		Category to		Balance at End		Category to
	of Period		Total Deposits		of Period		Total Deposits
	6/30/24		6/30/24		6/30/23		6/30/23
Non-interest bearing	$	670,652	51.4	%	$	716,438	51.4	%
Money Market		214,063	16.4	%		213,386	15.3	%
Savings		322,081	24.7	%		374,013	26.8	%
Time		97,791	7.5	%		91,323	6.5	%
Total Deposits	$	1,304,587	100	%	$	1,395,160	100	%

FAQ

What were Plumas Bancorp's Q2 2024 earnings?

Plumas Bancorp reported Q2 2024 earnings of $6.8 million or $1.15 per share.

How did Plumas Bancorp's net income for H1 2024 compare to H1 2023?

Net income for H1 2024 was $13.0 million or $2.21 per share, down from $14.3 million or $2.44 per share in H1 2023.

What was the increase in total equity for Plumas Bancorp as of June 30, 2024?

Total equity increased by 28% to $165 million as of June 30, 2024.

What were the changes in Plumas Bancorp's gross loans and deposits in Q2 2024?

Gross loans increased by $62 million to $997 million, while total deposits decreased by $91 million to $1.3 billion.

What was Plumas Bancorp's book value per share as of June 30, 2024?

The book value per share increased by $6.09 to $28.01.

Plumas Bancorp Reports Second Quarter 2024 Earnings

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What were Plumas Bancorp's Q2 2024 earnings?

How did Plumas Bancorp's net income for H1 2024 compare to H1 2023?

What was the increase in total equity for Plumas Bancorp as of June 30, 2024?

What were the changes in Plumas Bancorp's gross loans and deposits in Q2 2024?

What was Plumas Bancorp's book value per share as of June 30, 2024?

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Plumas Bancorp Reports Second Quarter 2024 Earnings

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FAQ

What were Plumas Bancorp's Q2 2024 earnings?

How did Plumas Bancorp's net income for H1 2024 compare to H1 2023?

What was the increase in total equity for Plumas Bancorp as of June 30, 2024?

What were the changes in Plumas Bancorp's gross loans and deposits in Q2 2024?

What was Plumas Bancorp's book value per share as of June 30, 2024?

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