Triad Business Bank (OTC Pink - "TBBC") Announces Unaudited First Quarter, 2023 Results

GREENSBORO, N.C., April 27, 2023 /PRNewswire/ --

Overview

Triad Business Bank ("the Bank") continues to serve and support the Triad's business communities and meet the needs of our customers.  The Bank remains highly liquid as core deposits are stable.  Total deposits increased by $36.0 million during the first quarter of 2023.  Maintaining a stable deposit base in this environment resulted in rapid increases in the Bank's deposit costs and a reduced net interest margin.  The Bank processed over $1.4 billion of business transactions while also continuing to extend credit and increasing the loan portfolio by $28.0 million during the quarter.  The Bank's asset quality remains strong with no nonperforming or past due loans.  Our $300.2 million core loan portfolio is repricing to current market rates with a 2.5-year average duration, which we believe will result in the Bank having a prolonged expansion of its margin as loan assets continually reprice.  The $136.8 million investment portfolio will also work to expand margins given the 4.5-year duration and serves as an on-balance sheet source of liquidity. 

The Bank reported a net loss of $2.42 million for the quarter ended March 31, 2023.  The results were negatively impacted by a $1.75 million charge-off of a corporate bond issued by Signature Bank which was purchased by the Bank in November 2020.  This charge-off represented less than 3% of the Bank's regulatory capital, which totaled $60.2 million at March 31, 2023.

The Bank also adopted the new Current Expected Credit Loss ("CECL") accounting standard effective January 1, 2023.  The overall effect of the adoption was an immaterial change from the December 31, 2022 amounts but did result in the establishment of a new Allowance for Credit Loss ("ACL") on Unfunded Commitments in other liabilities on the balance sheet.

In the first quarter of 2023, the Bank increased the ACL on Loans and Unfunded Commitments by $512,000.  There was no ACL on Held-To-Maturity Securities.  The $4.0 million in total ACL on March 31, 2023 is included in the Bank's total regulatory capital.

Balance Sheet Highlights Comparing March 31, 2023, and December 31, 2022

• Core loans increased $28.0 million to $300.2 million
• Deposits increased $36.0 million to $428.9 million
• Allowance for funded and unfunded credit losses increased $700,000 to $4.0 million
• No non-performing or past due assets reported
• Duration of loan portfolio and investment portfolio is 2.5 years and 4.5 years, respectively
• Regulatory total risk-based capital of $60.2 million

Income Statement Highlights Comparing the Quarters Ended March 31, 2023, and March 31, 2022

• Core operating loss totaled $162,000 compared to earnings of $61,000 (non-GAAP measurement)
• Net interest income increased 13%, or $306,000, to $2.65 million
• Noninterest income increased 87% to $221,000

Balance Sheet Comparison 

Total assets increased $39.8 million during the first quarter of 2023 from $445.1 million on December 31, 2022, to $484.9 million at March 31, 2023.  Core loans increased $28.0 million and deposits increased $36.0 million.  Although continued growth in new core deposit accounts occurred during the first quarter, core deposit balances did not maintain the same pace of first quarter loan growth.  The core deposits decline of $14.9 million during the first quarter was offset by an increase of $51.0 million in brokered deposits.

Shareholders' equity declined $540,000 during the quarter to $37.9 million.  This decline was primarily due to the $1.75 million charge-off on the Signature Bank bond.  The AOCI loss on March 31, 2023 was $18.3 million.  The AOCI loss is expected to reverse as the bond portfolio shortens in duration and is assumed to mature at par value.

Income Statement Comparison 

Net loss totaled $2.42 million for the quarter ending March 31, 2023, compared to a loss of $569,000 for the three months ending March 31, 2022.  Core operating results, a non-GAAP measurement which excludes the provision for credit losses and taxes, were a net loss of $162,000 for the three months ending March 31, 2023, compared to earnings of $61,000 for the three months ending March 31, 2022.  Provision for credit losses was elevated during the quarter due to the effect of applying CECL to the loan portfolio as of March 31, 2023 combined with the charge-off on the bond issued by Signature Bank which the Bank had purchased in November of 2020.

The Bank's primary source of income is the spread between the interest it earns on loans and investments and the interest it pays on deposits.  Net interest income increased $306,000 to $2.65 million for the first quarter of 2023 from $2.34 million for the same period a year ago.  Compared to the fourth quarter of 2022, net interest income declined $599,000 from $3.25 million.  The Bank's net interest margin for the first quarter of 2023 declined 12 basis points to 2.38% compared to the same period a year ago, but on a linked quarter basis, the margin declined 54 basis points due to the addition of high cost brokered deposits combined with the rapid increase in the cost of interest-bearing money market accounts.

Interest income increased $2.26 million, or 85%, to $4.92 million in the first quarter of 2023 compared to $2.65 million in the first quarter of 2022.  The growth in interest income was due primarily to growth in core loans which increased $82.5 million to $300.2 million at the end of March 2023.  The weighted average yield on average core loans increased to 5.12% in the first quarter of 2023 from 3.50% in the first quarter of 2022.  The weighted average rate on interest-bearing deposits increased to 3.05% in the first quarter of 2023 from 0.55% in the first quarter of 2022 due to the increase of brokered deposits and higher market interest rates.  

Noninterest expense increased $632,000, or 26%, to $3.04 million for the first quarter of 2023 compared to $2.41 million in the first quarter of 2022.  Salaries and benefits expense totaled $2.06 million for the first quarter of 2023, which was an increase of $403,000, or 24%, over the first quarter of 2022.  Most of this increase was due to growth in compensation expense resulting from staff additions.  The Bank had 58 employees at the end of the March 2023 quarter compared to 49 at the end of the March 2022 quarter.  We continue to position the Bank for growth and are pleased with the progress we have made since opening in 2020.

Regulatory Capital

The Bank's regulatory capital, which is the primary factor that allows for growth, declined by $1.7 million to $60.2 million on March 31, 2023.  Total risk-based capital consists of tier 1 capital and tier 2 capital.  The Bank's tier 1 capital is largely a measure of the Bank's shareholder equity as calculated under GAAP but eliminates certain volatile elements such as AOCI loss.  The Bank's tier 1 capital decreased from operations by $2.3 million to $56.2 million at March 31, 2023.  The Bank's tier 2 capital increased to $4.0 million.  Tier 1 and tier 2 capital ratios are measured against total assets and risk-weighted assets.  Our capital ratios have remained well above the levels required to meet "well-capitalized" standards under regulatory guidelines. 

The following is a summary presentation of the Bank's total regulatory capital to risk-weighted assets, tier 1 capital to risk-weighted assets and tier 1 capital to average assets in comparison with the regulatory guidelines on March 31, 2023:

Capital and Capital Ratios

					Quarter Ended
					3/31/2023
					Amount		Ratio
Actual
(dollars in thousands)
Total Capital (to risk-weighted assets)					$  60,210		14.03 %
Tier 1 Capital (to risk-weighted assets)					$  56,154		13.09 %
Tier 1 Capital (to average assets)					$  56,154		11.73 %
Minimum To Be Well-Capitalized Under
Prompt Corrective Action Provisions
(dollars in thousands)
Total Capital (to risk-weighted assets)					$  43,000		10.00 %
Tier 1 Capital (to risk-weighted assets)					$  34,000		8.00 %
Tier 1 Capital (to average assets)					$  24,000		5.00 %

Loans

The Bank's core loans increased $28.0 million, or 10%, to $300.2 million during the first quarter of 2023.  While not included in loans outstanding, the Bank also had unfunded loan commitments of $116.8 million, bringing total core loans outstanding and unfunded commitments to $417.0 million on March 31, 2023.  For internal monitoring purposes, the Bank considers owner occupied real estate loans to be part of commercial and industrial ("C&I") loans.  As of March 31, 2023, approximately 53% of the Bank's outstanding core loan portfolio was composed of C&I loans:

Loan Diversification

				Percentage of
		Quarter Ended		Core Loan
Loan Category		3/31/2023		Portfolio
Other Construction & Land Development		$        52,385,995
Non-owner Occupied Commercial Real Estate		87,481,157
Total Commercial Real Estate		139,867,152		47 %
Owner Occupied Real Estate		69,460,698
C&I		89,462,650
Total C&I		158,923,348		53 %
Other Revolving Loans		1,412,524		0 %
Total		$      300,203,024

Credit Risk

The Bank had no past due loans or nonperforming assets as of March 31, 2023.  The Bank's loan portfolio has been underwritten conservatively with a focus on cash flows of prospective borrowers.

Deferred Tax Asset and AOCI (Non-GAAP Measures)

The Bank's GAAP tangible book value per share declined from $5.82 at December 31, 2022 to $5.74 at March 31, 2023 primarily as a result of the operating loss.  On a non-GAAP basis, excluding the AOCI loss and the impairment on the Bank's deferred tax asset (two reductions in capital the Bank anticipates it will recover over time), adjusted tangible book value per share was $8.83 at March 31, 2023 compared to $9.09 at December 31, 2022.

The organization and startup costs incurred during the Bank's organizational period and net operating losses in the first three years of operations created a deferred tax asset of $2.2 million.  This asset is currently fully impaired and will be carried at $0 until sufficient, verifiable evidence exists (generally, sustained profitability) to demonstrate that the deferred tax asset will more likely than not be realized.  At that time, the valuation allowance will be reversed.

The change in value of the Bank's investment securities that are available for sale is recorded in AOCI as a gain or loss, based on current circumstances, and constitutes an unrealized component of equity.  At quarter-end the Bank had an AOCI loss of $18.3 million.  Assuming the underlying investment securities are held until maturity and there are no credit losses, the value of the securities will return to the face value at maturity.  Therefore, as a non-GAAP measure, the Bank eliminates its current AOCI loss to reflect an adjusted tangible book value.  

Outlook

The Bank's $300.2 million core loan portfolio has an average duration of 2.5 years whereas the Bank's deposit base has repriced more rapidly.  If current market rates remain stable or increase with another increase from the Federal Reserve, we expect our core loan portfolio to reprice over the next several quarters, gradually expanding net margin.

About Triad Business Bank

With three co-equal offices located in Winston-Salem, High Point and Greensboro, Triad Business Bank focuses on meeting the needs of small to midsize businesses and their owners by providing loans, treasury management and private banking, all with a high level of personal attention and best-in-class technology.  For more information, visit www.triadbusinessbank.com.

Non-GAAP Financial Measures

This release contains financial information determined by methods other than in accordance with generally accepted accounting principles in the United States ("GAAP").  The management of Triad Business Bank uses these non-GAAP financial measures in its analysis of the Bank's performance.  These measures typically adjust GAAP performance measures to exclude the effects of the provision for loan losses, income tax, deferred tax asset, and AOCI.  Management believes presentations of these non-GAAP financial measures provide useful supplemental information that is essential to a proper understanding of the operating results of the Bank.  These non-GAAP disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.

Forward Looking Language

This release contains certain forward-looking statements with respect to the financial condition, results of operations and business of Triad Business Bank.  These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of management of Triad Business Bank and on the information available to management at the time that these disclosures were prepared.  These statements can be identified by the use of words like "expect," "anticipate," "estimate" and "believe," variations of these words and other similar expressions.  Readers should not place undue reliance on forward-looking statements as a number of important factors could cause actual results to differ materially from those in the forward-looking statements.  Triad Business Bank undertakes no obligation to update any forward-looking statements.

 

Triad Business Bank
Balance Sheet (Unaudited)						March 31, 2023		March 31, 2022			$ Change		% Change
	Assets
	Cash & Due from Banks					$       41,939,297		$       20,310,759			$21,628,538		106 %
	Securities					136,775,960		141,254,967			(4,479,007)		-3 %
	Federal Funds Sold					-		-			-		0 %
	PPP Loans					767,312		7,592,431			(6,825,119)		-90 %
	Core Loans					300,203,024		217,654,388			82,548,636		38 %
	Allowance for Credit Losses ("ACL")					(3,354,606)		(2,727,138)			(627,468)		-23 %
	Loans, Net					297,615,730		222,519,681			75,096,049		34 %
	Other Assets					8,598,657		8,133,919			464,738		6 %
	Total Assets					$     484,929,644		$     392,219,326			$92,710,318		24 %
	Liabilities
	Demand Deposits					$     106,109,354		$     101,451,870			$  4,657,484		5 %
	ICS Reciprocal - Checking					26,977,867		-			26,977,867		100 %
	Commercial Operating Accounts					133,087,221		101,451,870			31,635,351		31 %
	Interest-bearing NOW					5,468,207		41,499,830			(36,031,623)		-87 %
	Core MMA & Savings					169,575,165		149,857,953			19,717,212		13 %
	ICS Reciprocal - MMA					20,430,098		-			20,430,098		100 %
	Total MMA & Savings					190,005,263		149,857,953			40,147,310		27 %
	Core Time Deposits					7,421,530		709,464			6,712,066		946 %
	CDARS - Reciprocal					5,746,927		3,512,740			2,234,187		64 %
	Brokered CDs					87,165,000		35,875,818			51,289,182		143 %
	Total Time Deposits					100,333,457		40,098,022			60,235,435		150 %
	Total Deposits					428,894,148		332,907,675			95,986,473		29 %
	Other Borrowings					15,000,000		7,232,282			7,767,718		107 %
	Federal Funds Purchased					-		-			-		0 %
	ACL on Unfunded Commitments					700,980		-			700,980		100 %
	Other Liabilities					2,435,003		2,648,360			(213,357)		-8 %
	Total Liabilities					447,030,131		342,788,317			104,241,814		30 %
	Shareholders' Equity
	Common Stock					66,037,467		65,244,746			792,721		1 %
	Accumulated Deficit					(9,884,175)		(7,539,404)			(2,344,771)		-31 %
	Accumulated Other Comprehensive Loss					(18,253,779)		(8,274,333)			(9,979,446)		-121 %
	Total Shareholders' Equity					37,899,513		49,431,009			(11,531,496)		-23 %
	Total Liabilities & Shareholders' Equity					$     484,929,644		$     392,219,326			$92,710,318		24 %
	Shares Outstanding					6,602,984		6,602,984			0		0 %
	Tangible Book Value per Share					$                5.74		$                7.49			$         (1.75)		-23 %

 

Triad Business Bank
Income Statement (Unaudited)							For three months ended		For three months ended
							March 31, 2023		March 31, 2022			$ Change		% Change
	Interest Income
	Interest & Fees on PPP Loans						$                                          2,017		$                                     143,170			$    (141,153)		-99 %
	Interest & Fees on Core Loans						3,533,828		1,682,226			1,851,602		110 %
	Interest & Dividend Income on Securities						1,011,613		804,501			207,112		26 %
	Interest Income on Balances Due from Banks						308,571		10,672			297,899		2791 %
	Other Interest Income						60,029		10,717			49,312		460 %
	Total Interest Income						4,916,058		2,651,286			2,264,772		85 %
	Interest Expense
	Interest on NOW Deposits						93,294		57,028			36,266		64 %
	Interest on Savings & MMA Deposits						1,342,045		203,850			1,138,195		558 %
	Interest on Time Deposits						591,865		20,459			571,406		2793 %
	Interest on Federal Funds Purchased						-		918			(918)		-100 %
	Interest on Borrowings						180,360		11,739			168,621		1436 %
	Other Interest Expense						54,519		8,940			45,579		510 %
	Total Interest Expense						2,262,083		302,934			1,959,149		647 %
	Net Interest Income						2,653,975		2,348,352			305,623		13 %
		Provision for Credit Losses					2,262,148		626,024			1,636,124		261 %
	Net Interest Income After Provision for CL						391,827		1,722,328			(1,330,501)		-77 %
	Total Noninterest Income						193,706		129,855			63,851		49 %
	Total Gain (Loss) on Securities						27,300		(11,907)			39,207		329 %
	Noninterest Expense
	Salaries & Benefits						2,061,734		1,658,862			402,872		24 %
	Premises & Equipment						135,654		122,069			13,585		11 %
	Total Other Noninterest Expense						839,972		624,372			215,600		35 %
	Total Noninterest Expense						3,037,360		2,405,303			632,057		26 %
		Income (Loss) Before Income Tax					(2,424,527)		(565,027)			(1,859,500)		-329 %
		Income Tax					-		3,561			(3,561)		-100 %
		Net Income (Loss)					$                       (2,424,527)		$                          (568,588)			$(1,855,939)		-326 %
	Net Income (Loss) per Share
		Basic					$                               (0.37)		$                               (0.09)			$        (0.28)		-326 %
		Diluted					$                               (0.37)		$                               (0.09)			$        (0.28)		-326 %
	Weighted Average Shares Outstanding
		Basic					6,602,984		6,602,984			-		0 %
		Diluted					6,602,984		6,602,984			-		0 %
	Pre-provision, Pre-tax Income (Loss)						$                          (162,379)		$                             60,997			$   (223,376)		-366 %

 

Triad Business Bank
Key Ratios & Other Information (Unaudited)
							Quarter Ended						Quarter Ended
							3/31/2023						3/31/2022
							Interest						Interest
							Income/		Yield/				Income/		Yield/
					Balance		Expense		Rate		Balance		Expense		Rate
Yield on Average Loans
Average PPP Loans					$          796,408		$                2,017		1.027 %		$    10,481,083		$           143,170		5.540 %
Average Core Loans					280,013,561		3,533,828		5.118 %		194,987,088		1,682,226		3.499 %
Yield on Average Investment Securities					$  138,381,519		$       1,011,613		2.965 %		$  145,816,868		$           804,501		2.238 %
Cost of Average Interest-bearing Liabilities					$  300,356,353		$       2,262,083		3.054 %		$  221,981,810		$           302,934		0.553 %
Net Interest Margin
Interest Income							$       4,916,058						$       2,651,286
Interest Expense							2,262,083						302,934
Average Earnings Assets					$  452,302,999						$  380,351,577
Net Interest Income & Net Interest Margin							$       2,653,975		2.380 %				$       2,348,352		2.504 %
Loan to Asset Ratio
Loan Balance					$  300,970,336						$  225,246,819
Total Assets					484,929,644				62.065 %		392,219,326				57.429 %
Leverage Ratio
Tier 1 Capital					$    56,153,292						$    57,705,342
Average Total Assets					478,763,984						393,553,369
Average FRB Borrowings					-				11.729 %		7,659,018				14.954 %
Unfunded Commitments to Extend Credit					$  116,775,485						$  100,350,230
Standby Letters of Credit					277,240						-

 

Triad Business Bank
Balance Sheet (Unaudited)						March 31, 2023		December 31, 2022		September 30, 2022		June 30, 2022		March 31, 2022
	Assets
	Cash & Due from Banks					$       41,939,297		$             30,177,676		$               47,037,775		$   46,737,951		$       20,310,759
	Securities					136,775,960		137,158,352		135,237,677		139,131,597		141,254,967
	Federal Funds Sold					-		-		-		-		-
	PPP Loans					767,312		848,172		928,829		2,273,307		7,592,431
	Core Loans					300,203,024		272,200,717		252,906,111		236,584,017		217,654,388
	Allowance for Credit Losses ("ACL")					(3,354,606)		(3,418,841)		(3,161,326)		(2,956,667)		(2,727,138)
	Loans, Net					297,615,730		269,630,048		250,673,614		235,900,657		222,519,681
	Other Assets					8,598,657		8,142,741		8,379,460		8,116,313		8,133,919
	Total Assets					$     484,929,644		$           445,108,817		$             441,328,526		$  429,886,518		$     392,219,326
	Liabilities
	Demand Deposits					$     106,109,354		$           176,820,321		$             134,843,448		$  146,584,560		$     101,451,870
	ICS Reciprocal - Checking					26,977,867		-		-		-		-
	Commercial Operating Accounts					133,087,221		176,820,321		134,843,448		146,584,560		101,451,870
	Interest-bearing NOW					5,468,207		13,209,174		19,567,049		32,071,869		41,499,830
	Core MMA & Savings					169,575,165		159,857,410		195,380,253		165,238,615		149,857,953
	ICS Reciprocal - MMA					20,430,098		-		-		-		-
	Total MMA & Savings					190,005,263		159,857,410		195,380,253		165,238,615		149,857,953
	Core Time Deposits					7,421,530		3,748,773		1,444,294		550		709,464
	CDARS - Reciprocal					5,746,927		3,012,964		3,516,682		3,514,877		3,512,740
	Brokered CDs					87,165,000		36,213,632		44,339,083		36,945,833		35,875,818
	Total Time Deposits					100,333,457		42,975,369		49,300,059		40,461,260		40,098,022
	Total Deposits					428,894,148		392,862,274		399,090,809		384,356,304		332,907,675
	Other Borrowings					15,000,000		10,000,000		-		-		7,232,282
	Federal Funds Purchased					-		-		-		-		-
	ACL on Unfunded Commitments					700,980		-		-		-		-
	Other Liabilities					2,435,003		3,807,240		3,008,372		2,473,355		2,648,360
	Total Liabilities					447,030,131		406,669,514		402,099,181		386,829,659		342,788,317
	Shareholders' Equity
	Common Stock					66,037,467		65,824,785		65,622,058		65,421,510		65,244,746
	Accumulated Deficit					(9,884,175)		(7,334,490)		(7,413,290)		(7,640,872)		(7,539,404)
	Accumulated Other Comprehensive Loss					(18,253,779)		(20,050,992)		(18,979,423)		(14,723,779)		(8,274,333)
	Total Shareholders' Equity					37,899,513		38,439,303		39,229,345		43,056,859		49,431,009
	Total Liabilities & Shareholders' Equity					$     484,929,644		$           445,108,817		$             441,328,526		$  429,886,518		$     392,219,326
	Shares Outstanding					6,602,984		6,602,984		6,602,984		6,602,984		6,602,984
	Tangible Book Value per Share					$                5.74		$                       5.82		$                        5.94		$             6.52		$                7.49

 

Triad Business Bank
Income Statement (Unaudited)							For three months ended		For three months ended		For three months ended		For three months ended		For three months ended
							March 31, 2023		December 31, 2022		September 30, 2022		June 30, 2022		March 31, 2022
	Interest Income
	Interest & Fees on PPP Loans						$                                          2,017		$                                          2,267		$                                       32,081		$                                     111,590		$                                     143,170
	Interest & Fees on Core Loans						3,533,828		3,221,915		2,639,317		2,107,818		1,682,226
	Interest & Dividend Income on Securities						1,011,613		966,457		926,042		873,881		804,501
	Interest Income on Balances Due from Banks						308,571		356,933		155,882		61,152		10,672
	Other Interest Income						60,029		46,138		22,127		5,877		10,717
	Total Interest Income						4,916,058		4,593,710		3,775,449		3,160,318		2,651,286
	Interest Expense
	Interest on NOW Deposits						93,294		83,153		62,688		48,086		57,028
	Interest on Savings & MMA Deposits						1,342,045		939,932		430,711		223,635		203,850
	Interest on Time Deposits						591,865		235,806		162,894		76,666		20,459
	Interest on Federal Funds Purchased						-		-		470		717		918
	Interest on Borrowings						180,360		41,303		33,733		12,928		11,739
	Other Interest Expense						54,519		40,651		18,316		2,750		8,940
	Total Interest Expense						2,262,083		1,340,845		708,812		364,782		302,934
	Net Interest Income						2,653,975		3,252,865		3,066,637		2,795,536		2,348,352
		Provision for Credit Losses					2,262,148		257,515		204,659		229,529		626,024
	Net Interest Income After Provision for CL						391,827		2,995,350		2,861,978		2,566,007		1,722,328
	Total Noninterest Income						193,706		162,873		303,701		146,953		129,855
	Total Gain (Loss) on Securities						27,300		(94,500)		(2,856)		(46,893)		(11,907)
	Noninterest Expense
	Salaries & Benefits						2,061,734		2,086,924		2,052,870		1,901,183		1,658,862
	Premises & Equipment						135,654		111,398		144,455		126,979		122,069
	Total Other Noninterest Expense						839,972		758,263		720,716		721,227		624,372
	Total Noninterest Expense						3,037,360		2,956,585		2,918,041		2,749,389		2,405,303
		Income (Loss) Before Income Tax					(2,424,527)		107,138		244,782		(83,322)		(565,027)
		Income Tax					-		28,338		17,199		18,146		3,561
		Net Income (Loss)					$                       (2,424,527)		$                             78,800		$                           227,583		$                          (101,468)		$                          (568,588)
	Net Income (Loss) per Share
		Basic					$                               (0.37)		$                                0.01		$                                0.03		$                               (0.02)		$                               (0.09)
		Diluted					$                               (0.37)		$                                0.01		$                                0.03		$                               (0.02)		$                               (0.09)
	Weighted Average Shares Outstanding
		Basic					6,602,984		6,602,984		6,602,984		6,602,984		6,602,984
		Diluted					6,602,984		6,842,684		6,842,779		6,602,984		6,602,984
	Pre-provision, Pre-tax Income (Loss)						$                          (162,379)		$                           364,653		$                           449,441		$                           146,207		$                             60,997

 

Triad Business Bank
Key Ratios & Other Information (Unaudited)
							Quarter Ended						Quarter Ended						Quarter Ended
							3/31/2023						12/31/2022						9/30/2022
							Interest						Interest						Interest
							Income/		Yield/				Income/		Yield/				Income/		Yield/
					Balance		Expense		Rate		Balance		Expense		Rate		Balance		Expense		Rate
Yield on Average Loans
Average PPP Loans					$          796,408		$                2,017		1.027 %		$          877,145		$                2,267		1.025 %		$       1,535,894		$             32,081		8.287 %
Average Core Loans					280,013,561		3,533,828		5.118 %		266,727,991		3,221,915		4.792 %		249,410,110		2,639,317		4.198 %
Yield on Average Investment Securities					$  138,381,519		$       1,011,613		2.965 %		$  135,664,230		$           966,457		2.826 %		$  140,999,639		$           926,042		2.606 %
Cost of Average Interest-bearing Liabilities					$  300,356,353		$       2,262,083		3.054 %		$  259,707,088		$       1,340,845		2.048 %		$  261,272,291		$           708,812		1.076 %
Net Interest Margin
Interest Income							$       4,916,058						$       4,593,710						$       3,775,449
Interest Expense							2,262,083						1,340,845						708,812
Average Earnings Assets					$  452,302,999						$  442,777,435						$  423,153,761
Net Interest Income & Net Interest Margin							$       2,653,975		2.380 %				$       3,252,865		2.915 %				$       3,066,637		2.875 %
Loan to Asset Ratio
Loan Balance					$  300,970,336						$  273,048,889						$  253,834,940
Total Assets					484,929,644				62.065 %		445,108,817				61.344 %		441,328,526				57.516 %
Leverage Ratio
Tier 1 Capital					$    56,153,292						$    58,490,295						$    58,208,768
Average Total Assets					478,763,984						470,154,080						445,828,670
Average FRB Borrowings					-				11.729 %		-				12.441 %		-				13.056 %
Unfunded Commitments to Extend Credit					$  116,775,485						$  102,576,003						$    96,122,332
Standby Letters of Credit					277,240						277,240						277,240

 

Triad Business Bank
Capital and Capital Ratios (Unaudited)
					Quarter Ended				Quarter Ended				Quarter Ended				Quarter Ended				Quarter Ended
					3/31/2023				12/31/2022				9/30/2022				6/30/2022				3/31/2022
					Amount		Ratio		Amount		Ratio		Amount		Ratio		Amount		Ratio		Amount		Ratio
Actual
(dollars in thousands)
Total Capital (to risk-weighted assets)					$  60,210		14.03 %		$  61,909		15.45 %		$  61,370		16.26 %		$  60,713		16.87 %		$  60,388		17.87 %
Tier 1 Capital (to risk-weighted assets)					$  56,154		13.09 %		$  58,490		14.60 %		$  58,209		15.42 %		$  57,781		16.05 %		$  57,705		17.08 %
Tier 1 Capital (to average assets)					$  56,154		11.73 %		$  58,490		12.44 %		$  58,209		13.06 %		$  57,781		13.67 %		$  57,705		14.95 %
Minimum To Be Well-Capitalized Under
Prompt Corrective Action Provisions
(dollars in thousands)
Total Capital (to risk-weighted assets)					$  43,000		10.00 %		$  40,000		10.00 %		$  38,000		10.00 %		$  36,000		10.00 %		$  34,000		10.00 %
Tier 1 Capital (to risk-weighted assets)					$  34,000		8.00 %		$  32,000		8.00 %		$  30,000		8.00 %		$  29,000		8.00 %		$  27,000		8.00 %
Tier 1 Capital (to average assets)					$  24,000		5.00 %		$  24,000		5.00 %		$  22,000		5.00 %		$  21,000		5.00 %		$  19,000		5.00 %

 

Triad Business Bank
Non-GAAP Measures (Unaudited)
Tangible Book Value
								Actual 3/31/2023		Non-GAAP 3/31/2023
Total Shareholders' Equity								$ 37,899,513		$ 37,899,513
Eliminate Deferred Tax Asset Valuation Allowance								-		2,155,657
Eliminate Accumulated Other Comprehensive Loss								-		18,253,779
Adjusted Shareholders' Equity								$ 37,899,513		$ 58,308,949
Shares Outstanding								6,602,984		6,602,984
Tangible Book Value per Share								$            5.74		$            8.83
Effect of Non-GAAP Measures on Tangible Book Value										$            3.09
During the start-up phase of the Bank, a valuation allowance was created which fully impairs the deferred tax asset.  When sufficient, verifiable evidence exists (generally, sustained profitability) demonstrating that the deferred tax asset will more likely than not be realized, the valuation allowance will be eliminated.  This Non-GAAP measure is shown to disclose the effect on tangible book value per share at March 31, 2023 had there been no valuation allowance at that date.
Changes in the market value of available-for-sale securities are reflected in accumulated other comprehensive loss.  Since the securities value will return to face value at maturity, assuming the underlying securities are held to maturity and there is no credit loss, accumulated other comprehensive loss has been eliminated in this Non-GAAP measure.
Pre-provision Income
								Qtr Ended 3/31/2023		Qtr Ended 12/31/2022		Qtr Ended 9/30/2022
Income (Loss) Before Income Tax								$ (2,424,527)		$      107,138		$            244,782
Provision for Loan Losses								2,262,148		257,515		204,659
Pre-provision Income (Loss) Before Income Tax (Non-GAAP)								$    (162,379)		$      364,653		$            449,441
The pre-provision income is a measure of operating performance exclusive of potential losses from lending.

 

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SOURCE Triad Business Bank