Triad Business Bank (OTC Pink - "TBBC"), August 8, 2023, Announces Unaudited Second Quarter 2023 Results

GREENSBORO, N.C., Aug. 8, 2023 /PRNewswire/ -- 

Overview

Triad Business Bank ("the Bank") was formed in 2020 to serve small and mid-size businesses in the Triad.  Since then, the Bank has become a financial partner to over 600 business customers, and in the last six months, the Bank facilitated more than $2.8 billion of transactions, including $1.4 billion in the second quarter.  At June 30, 2023, the Bank's total assets exceeded one half billion dollars, and the Bank had a strong capital foundation with over $60.0 million of total regulatory capital.  Asset quality remains strong with no nonperforming or past due loans.  Recent market conditions accelerated the rise in cost of deposits, which resulted in a decline in the Bank's net interest margin and an operating loss of $362,000.  This loss (adjusted for equity related compensation expense) lowered the Bank's regulatory capital by only 0.32%.  In the second quarter 2023, the Bank's net interest margin largely stabilized at 2.29%, down 9 basis points from 2.38% in the first quarter 2023 and 63 basis points from 2.92% in the fourth quarter 2022.  The decline was a result of deposits repricing at a greater pace and amount than loans and investments.  Our $315.6 million core loan portfolio has a 2.5 to 3-year average duration, which may result in an expansion of its margin as loan assets continually reprice.

Other Events

The Bank has expanded its product offering to include Small Business Administration ("SBA") guaranteed loans, originating one SBA guaranteed loan for $245,000 in the second quarter 2023.  The current SBA pipeline is $13.7 million of loan prospects.  The Bank intends to sell the SBA guaranteed portions of these loans to bolster the Bank's fee income.  The Bank is using a third-party underwriter and loan servicer to assist in the origination of SBA loans. 

Also during the second quarter 2023, the Bank strengthened its leadership team through the appointment of Richard Cobb as Chief Financial Officer ("CFO") and the addition of Jonathan Kelly to the Board of Directors.  Mr. Cobb has over 30 years of banking experience in the Triad, including serving as the CFO and Controller of multiple billion-dollar public companies.  Mr. Kelly is the founder and Chief Executive Officer of Asymmetric Holdings Worldwide, a Greensboro, North Carolina-based investment holding company focused on investment strategy and capital allocation.

Balance Sheet Highlights Comparing June 30, 2023 and March 31, 2023

• Total assets increased 6% to $513.1 million
• Core loans increased 5% to $315.6 million
• Deposits increased 9% to $468.0 million
• Allowance for funded and unfunded credit losses remained stable at $4.1 million
• No nonperforming or past due assets reported
• Regulatory total risk-based capital of $60.0 million

Income Statement Highlights Comparing the Quarters Ended June 30, 2023 and June 30, 2022

• Core operating loss totaled $362,000 compared to earnings of $146,000 (non-GAAP measurement) in the prior year
• Net interest income declined 3%, or $74,000, to $2.72 million
• Noninterest income, excluding gain (loss) on securities, increased 11% to $164,000
• Noninterest expense increased 18% to $3.25 million

Balance Sheet Comparison 

Total assets increased $28.2 million to $513.1 million during the second quarter of 2023 from $484.9 million at March 31, 2023.  During the quarter ended June 30, 2023, core loans increased $15.4 million and deposits increased $39.1 million.  Although new core deposit accounts continued to grow during the quarter ended June 30, 2023, core deposit balances did not maintain the same pace of second quarter 2023 loan growth.  Core deposits grew $6.1 million during the second quarter of 2023, supplemented by an increase of $33.0 million in brokered deposits and a decrease of $10.0 million in borrowings.

Shareholders' equity declined $1.3 million during the second quarter of 2023 to $36.6 million primarily due to the $1.0 million increase in the accumulated other comprehensive income ("AOCI") loss to $19.2 million.  The AOCI loss is expected to reverse as the bond portfolio shortens in duration and is assumed to mature at par value.  At June 30, 2023, the AOCI loss is believed to be the result of interest rate changes since the investment securities were acquired, and no credit losses are expected.

Income Statement Comparison 

Net loss totaled $436,000 for the quarter ended June 30, 2023, compared to a loss of $101,000 for the quarter ended June 30, 2022.  Core operating results, a non-GAAP measurement which excludes the provision for credit losses and taxes, were a net loss of $362,000 for the quarter ended June 30, 2023, compared to earnings of $146,000 for the quarter ended June 30, 2022.

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 declined $74,000 to $2.72 million for the second quarter of 2023 from $2.80 million for the same period a year ago.  The Bank's net interest margin for the second quarter of 2023 declined 48 basis points to 2.29% compared to the same period in 2022.  While the yield on earning assets increased in 2023 over 2022, the addition of higher cost brokered deposits and the rapid increase in the cost of interest-bearing accounts in 2023 resulted in the net interest margin compression.

Interest income increased $2.55 million, or 81%, to $5.71 million in the second quarter of 2023 compared to $3.16 million in the second quarter of 2022.  The growth in interest income was due primarily to the growth in core loans, which increased $79.0 million to $315.6 million, and an increase in the weighted average yield on average core loans to 5.45% in the second quarter of 2023 compared to 3.72% in the second quarter of 2022.  However, the weighted average rate on interest-bearing liabilities increased to 3.51% in the second quarter of 2023 compared to 0.59% in the second quarter of 2022 due to the increase of brokered deposits and higher market interest rates.  

Noninterest expense increased $502,000, or 18%, to $3.25 million for the second quarter of 2023 compared to $2.75 million in the second quarter of 2022.  Salaries and benefits expense totaled $2.11 million for the second quarter of 2023, which was an increase of $209,000, or 11%, over the second quarter of 2022 primarily due to staff additions.  The Bank had 59 employees at the end of June 2023 compared to 51 at the end of June 2022.  The Bank continues to position itself for growth and is pleased with its progress since opening in 2020.  Other operating expenses increased $293,000 for the second quarter of 2023 over the prior year same quarter, due principally to increases in professional fees, stock grant expense, customer check fraud charge offs and regulatory assessments.

Regulatory Capital

The Bank's regulatory capital, which is the primary factor that allows for growth, was $60.0 million at June 30, 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.  Tier 2 capital is primarily the allowance for funded and unfunded credit losses.  The Bank's tier 1 capital was $55.9 million at June 30, 2023, while tier 2 capital was $4.1 million.  Tier 1 and tier 2 capital ratios are measured against total assets and risk-weighted assets.  Our capital ratios remain 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 at June 30, 2023:

Capital and Capital Ratios

					Quarter Ended
					6/30/2023
					Amount		Ratio
Actual
(dollars in thousands)
Total Capital (to risk-weighted assets)					$  60,017		13.41 %
Tier 1 Capital (to risk-weighted assets)					$  55,886		12.48 %
Tier 1 Capital (to average assets)					$  55,886		11.11 %
Minimum To Be Well-Capitalized Under
Prompt Corrective Action Provisions
(dollars in thousands)
Total Capital (to risk-weighted assets)					$  45,000		10.00 %
Tier 1 Capital (to risk-weighted assets)					$  36,000		8.00 %
Tier 1 Capital (to average assets)					$  25,000		5.00 %

Loans

The Bank's core loans increased $79.0 million, or 33%, to $315.6 million at June 30, 2023, compared to $236.6 million at June 30, 2022.  While not included in loans outstanding, the Bank also had unfunded loan commitments of $132.6 million, bringing total core loans outstanding and unfunded commitments to $448.2 million at June 30, 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 June 30, 2023, approximately 51% of the Bank's outstanding core loan portfolio was composed of C&I loans:

Loan Diversification

				Percentage of
		Quarter Ended		Core Loan
Loan Category		6/30/2023		Portfolio
Other Construction & Land Development		$        55,940,015
Non-owner Occupied Commercial Real Estate		96,356,219
Total Commercial Real Estate		152,296,234		48 %
Owner Occupied Real Estate		73,519,138
C&I		88,428,552
Total C&I		161,947,690		51 %
Other Revolving Loans		1,322,201		1 %
Total		$      315,566,125

Credit Risk and Allowance for Credit Losses

The Bank had no past due loans or nonperforming assets at June 30, 2023.  Since inception, the Bank has followed conservative underwriting practices with a focus on cash flows and debt service coverage analyses of prospective borrowers.

The allowance for credit losses ("ACL") at June 30, 2023 was $3.51 million, or 1.11 % of outstanding loans.  The ACL for unfunded loan commitments, recorded as a liability on the balance sheet, was $621,000, or 0.47% of the unfunded commitments at June 30, 2023.

Deferred Tax Asset and AOCI (Non-GAAP Measures)

The Bank's GAAP tangible book value per share was $5.47 at June 30, 2023.  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 $8.69 at June 30, 2023.

The organization and startup costs incurred during the Bank's organizational period and net operating losses from the beginning of operations created a deferred tax asset of $2.3 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 June 30, 2023, the Bank had an AOCI loss of $19.2 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 fixed versus floating rate mix of the Bank's assets and liabilities has resulted in a substantial portion of the liabilities already reflecting increases in market rates whereas the loan portfolio, which has a 2.5 to 3-year average duration, is repricing more slowly.  If current deposit and market rates remain stable, we expect the repricing of our core loan portfolio over the next several quarters will gradually expand the net interest 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)						June 30, 2023		June 30, 2022			$ Change		% Change
	Assets
	Cash & Due from Banks					$              52,211,693		$              46,737,951			$               5,473,742		12 %
	Securities					139,889,880		139,131,597			758,283		1 %
	Federal Funds Sold					-		-			-		0 %
	PPP Loans					644,855		2,273,307			(1,628,452)		-72 %
	Core Loans					315,566,125		236,584,017			78,982,108		33 %
	Allowance for Credit Losses ("ACL")					(3,509,593)		(2,956,667)			(552,926)		-19 %
	Loans, Net					312,701,387		235,900,657			76,800,730		33 %
	Other Assets					8,296,216		8,116,313			179,903		2 %
	Total Assets					$            513,099,176		$            429,886,518			$              83,212,658		19 %
	Liabilities
	Demand Deposits					$            104,796,822		$            146,584,560			$             (41,787,738)		-29 %
	ICS Reciprocal - Checking					29,689,563		-			29,689,563		100 %
	Commercial Operating Accounts					134,486,385		146,584,560			(12,098,175)		-8 %
	Interest-bearing NOW					19,885,942		32,071,869			(12,185,927)		-38 %
	Core MMA & Savings					95,250,866		165,238,615			(69,987,749)		-42 %
	ICS Reciprocal - MMA					78,325,692		-			78,325,692		100 %
	Total MMA & Savings					173,576,558		165,238,615			8,337,943		5 %
	Core Time Deposits					9,541,015		550			9,540,465		---
	CDARS - Reciprocal					10,343,801		3,514,877			6,828,924		194 %
	Brokered CDs					120,201,839		36,945,833			83,256,006		225 %
	Total Time Deposits					140,086,655		40,461,260			99,625,395		246 %
	Total Deposits					468,035,540		384,356,304			83,679,236		22 %
	Other Borrowings					5,000,000		-			5,000,000		100 %
	Federal Funds Purchased					-		-			-		0 %
	ACL on Unfunded Commitments					620,519		-			620,519		100 %
	Other Liabilities					2,803,124		2,473,355			329,769		13 %
	Total Liabilities					476,459,183		386,829,659			89,629,524		23 %
	Shareholders' Equity
	Common Stock					66,206,484		65,421,510			784,974		1 %
	Accumulated Deficit					(10,320,428)		(7,640,872)			(2,679,556)		-35 %
	Accumulated Other Comprehensive Loss					(19,246,063)		(14,723,779)			(4,522,284)		-31 %
	Total Shareholders' Equity					36,639,993		43,056,859			(6,416,866)		-15 %
	Total Liabilities & Shareholders' Equity					$            513,099,176		$            429,886,518			$              83,212,658		19 %
	Shares Outstanding					6,693,965		6,602,984			90,981		1 %
	Tangible Book Value per Share					$                       5.47		$                       6.52			$                      (1.05)		-16 %

 

Triad Business Bank
Income Statement (Unaudited)							For three months ended		For three months ended
							June 30, 2023		June 30, 2022			$ Change		% Change
	Interest Income
	Interest & Fees on PPP Loans						$                                    2,016		$                               111,590			$                             (109,574)		-98 %
	Interest & Fees on Core Loans						4,154,484		2,107,818			2,046,666		97 %
	Interest & Dividend Income on Securities						1,090,464		873,881			216,583		25 %
	Interest Income on Balances Due from Banks						391,371		61,152			330,219		540 %
	Other Interest Income						76,387		5,877			70,510		1200 %
	Total Interest Income						5,714,722		3,160,318			2,554,404		81 %
	Interest Expense
	Interest on NOW Deposits						184,372		48,086			136,286		283 %
	Interest on Savings & MMA Deposits						1,329,486		223,635			1,105,851		494 %
	Interest on Time Deposits						1,228,575		76,666			1,151,909		1503 %
	Interest on Federal Funds Purchased						170		717			(547)		-76 %
	Interest on Borrowings						187,215		12,928			174,287		1348 %
	Other Interest Expense						62,970		2,750			60,220		2190 %
	Total Interest Expense						2,992,788		364,782			2,628,006		720 %
	Net Interest Income						2,721,934		2,795,536			(73,602)		-3 %
		Provision for Credit Losses					74,526		229,529			(155,003)		-68 %
	Net Interest Income After Provision for CL						2,647,408		2,566,007			81,401		3 %
	Total Noninterest Income						163,673		146,953			16,720		11 %
	Total Gain (Loss) on Securities						4,200		(46,893)			51,093		109 %
	Noninterest Expense
	Salaries & Benefits						2,110,577		1,901,183			209,394		11 %
	Premises & Equipment						135,379		126,979			8,400		7 %
	Total Other Noninterest Expense						1,005,578		721,227			284,351		39 %
	Total Noninterest Expense						3,251,534		2,749,389			502,145		18 %
		Loss Before Income Tax					(436,253)		(83,322)			(352,931)		-424 %
		Income Tax					-		18,146			(18,146)		-100 %
		Net Loss					$                      (436,253)		$                      (101,468)			$                      (334,785)		-330 %
	Net Loss per Share
		Basic					$                           (0.07)		$                           (0.02)			$                           (0.05)		-329 %
		Diluted					$                           (0.07)		$                           (0.02)			$                           (0.05)		-329 %
	Weighted Average Shares Outstanding
		Basic					6,622,596		6,602,984			19,612		0 %
		Diluted					6,622,596		6,602,984			19,612		0 %
	Pre-provision, Pre-tax Income (Loss)						$                      (361,727)		$                       146,207			$                      (507,934)		-347 %

 

Triad Business Bank
Key Ratios & Other Information (Unaudited)
							Quarter Ended						Quarter Ended
							6/30/2023						6/30/2022
							Interest						Interest
							Income/		Yield/				Income/		Yield/
					Balance		Expense		Rate		Balance		Expense		Rate
Yield on Average Loans
Average PPP Loans					$           679,454		$                2,016		1.190 %		$           3,314,501		$             111,590		13.504 %
Average Core Loans					305,837,047		4,154,484		5.449 %		227,417,815		2,107,818		3.718 %
Yield on Average Investment Securities					$   139,653,271		$        1,090,464		3.132 %		$      142,754,858		$             873,881		2.455 %
Yield on Average Interest-earning Assets					$   476,448,446		$        5,714,722		4.811 %		$      404,352,657		$          3,160,318		3.135 %
Cost of Average Interest-bearing Liabilities					$   341,864,123		$        2,992,788		3.511 %		$      246,148,158		$             364,782		0.594 %
Net Interest Margin
Interest Income							$        5,714,722						$          3,160,318
Interest Expense							2,992,788						364,782
Average Earnings Assets					$   476,448,446						$      404,352,657
Net Interest Income & Net Interest Margin							$        2,721,934		2.291 %				$          2,795,536		2.773 %
Loan to Asset Ratio
Loan Balance					$   316,210,980						$      238,857,324
Total Assets					513,099,176				61.628 %		429,886,518				55.563 %
Leverage Ratio
Tier 1 Capital					$     55,886,056						$         57,780,638
Average Total Assets					503,118,293						425,001,436
Average FRB Borrowings					-				11.108 %		2,332,853				13.670 %
Unfunded Commitments to Extend Credit					$   132,643,745						$         89,833,906
Standby Letters of Credit					267,240						27,240

 

Triad Business Bank
Balance Sheet (Unaudited)						June 30, 2023		March 31, 2023		December 31, 2022		September 30, 2022		June 30, 2022
	Assets
	Cash & Due from Banks					$              52,211,693		$              41,939,297		$              30,177,676		$              47,037,775		$              46,737,951
	Securities					139,889,880		136,775,960		137,158,352		135,237,677		139,131,597
	Federal Funds Sold					-		-		-		-		-
	PPP Loans					644,855		767,312		848,172		928,829		2,273,307
	Core Loans					315,566,125		300,203,024		272,200,717		252,906,111		236,584,017
	Allowance for Credit Losses ("ACL")					(3,509,593)		(3,354,606)		(3,418,841)		(3,161,326)		(2,956,667)
	Loans, Net					312,701,387		297,615,730		269,630,048		250,673,614		235,900,657
	Other Assets					8,296,216		8,598,657		8,142,741		8,379,460		8,116,313
	Total Assets					$            513,099,176		$            484,929,644		$            445,108,817		$            441,328,526		$            429,886,518
	Liabilities
	Demand Deposits					$            104,796,822		$            106,109,354		$            176,820,321		$            134,843,448		$            146,584,560
	ICS Reciprocal - Checking					29,689,563		26,977,867		-		-		-
	Commercial Operating Accounts					134,486,385		133,087,221		176,820,321		134,843,448		146,584,560
	Interest-bearing NOW					19,885,942		5,468,207		13,209,174		19,567,049		32,071,869
	Core MMA & Savings					95,250,866		169,575,165		159,857,410		195,380,253		165,238,615
	ICS Reciprocal - MMA					78,325,692		20,430,098		-		-		-
	Total MMA & Savings					173,576,558		190,005,263		159,857,410		195,380,253		165,238,615
	Core Time Deposits					9,541,015		7,421,530		3,748,773		1,444,294		550
	CDARS - Reciprocal					10,343,801		5,746,927		3,012,964		3,516,682		3,514,877
	Brokered CDs					120,201,839		87,165,000		36,213,632		44,339,083		36,945,833
	Total Time Deposits					140,086,655		100,333,457		42,975,369		49,300,059		40,461,260
	Total Deposits					468,035,540		428,894,148		392,862,274		399,090,809		384,356,304
	Other Borrowings					5,000,000		15,000,000		10,000,000		-		-
	Federal Funds Purchased					-		-		-		-		-
	ACL on Unfunded Commitments					620,519		700,980		-		-		-
	Other Liabilities					2,803,124		2,435,003		3,807,240		3,008,372		2,473,355
	Total Liabilities					476,459,183		447,030,131		406,669,514		402,099,181		386,829,659
	Shareholders' Equity
	Common Stock					66,206,484		66,037,467		65,824,785		65,622,058		65,421,510
	Accumulated Deficit					(10,320,428)		(9,884,175)		(7,334,490)		(7,413,290)		(7,640,872)
	Accumulated Other Comprehensive Loss					(19,246,063)		(18,253,779)		(20,050,992)		(18,979,423)		(14,723,779)
	Total Shareholders' Equity					36,639,993		37,899,513		38,439,303		39,229,345		43,056,859
	Total Liabilities & Shareholders' Equity					$            513,099,176		$            484,929,644		$            445,108,817		$            441,328,526		$            429,886,518
	Shares Outstanding					6,693,965		6,602,984		6,602,984		6,602,984		6,602,984
	Tangible Book Value per Share					$                       5.47		$                       5.74		$                       5.82		$                       5.94		$                       6.52

 

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
							June 30, 2023		March 31, 2023		December 31, 2022		September 30, 2022		June 30, 2022
	Interest Income
	Interest & Fees on PPP Loans						$                                    2,016		$                                    2,017		$                                    2,267		$                                  32,081		$                                   111,590
	Interest & Fees on Core Loans						4,154,484		3,533,828		3,221,915		2,639,317		2,107,818
	Interest & Dividend Income on Securities						1,090,464		1,011,613		966,457		926,042		873,881
	Interest Income on Balances Due from Banks						391,371		308,571		356,933		155,882		61,152
	Other Interest Income						76,387		60,029		46,138		22,127		5,877
	Total Interest Income						5,714,722		4,916,058		4,593,710		3,775,449		3,160,318
	Interest Expense
	Interest on NOW Deposits						184,372		93,294		83,153		62,688		48,086
	Interest on Savings & MMA Deposits						1,329,486		1,342,045		939,932		430,711		223,635
	Interest on Time Deposits						1,228,575		591,865		235,806		162,894		76,666
	Interest on Federal Funds Purchased						170		-		-		470		717
	Interest on Borrowings						187,215		180,360		41,303		33,733		12,928
	Other Interest Expense						62,970		54,519		40,651		18,316		2,750
	Total Interest Expense						2,992,788		2,262,083		1,340,845		708,812		364,782
	Net Interest Income						2,721,934		2,653,975		3,252,865		3,066,637		2,795,536
		Provision for Credit Losses					74,526		2,262,148		257,515		204,659		229,529
	Net Interest Income After Provision for CL						2,647,408		391,827		2,995,350		2,861,978		2,566,007
	Total Noninterest Income						163,673		193,706		162,873		303,701		146,953
	Total Gain (Loss) on Securities						4,200		27,300		(94,500)		(2,856)		(46,893)
	Noninterest Expense
	Salaries & Benefits						2,110,577		2,061,734		2,086,924		2,052,870		1,901,183
	Premises & Equipment						135,379		135,654		111,398		144,455		126,979
	Total Other Noninterest Expense						1,005,578		839,972		758,263		720,716		721,227
	Total Noninterest Expense						3,251,534		3,037,360		2,956,585		2,918,041		2,749,389
		Income (Loss) Before Income Tax					(436,253)		(2,424,527)		107,138		244,782		(83,322)
		Income Tax					-		-		28,338		17,199		18,146
		Net Income (Loss)					$                      (436,253)		$                   (2,424,527)		$                         78,800		$                       227,583		$                         (101,468)
	Net Income (Loss) per Share
		Basic					$                           (0.07)		$                           (0.37)		$                            0.01		$                            0.03		$                              (0.02)
		Diluted					$                           (0.07)		$                           (0.37)		$                            0.01		$                            0.03		$                              (0.02)
	Weighted Average Shares Outstanding
		Basic					6,622,596		6,602,984		6,602,984		6,602,984		6,602,984
		Diluted					6,622,596		6,602,984		6,842,684		6,842,779		6,602,984
	Pre-provision, Pre-tax Income (Loss)						$                      (361,727)		$                      (162,379)		$                       364,653		$                       449,441		$                          146,207

 

Triad Business Bank
Capital and Capital Ratios (Unaudited)
					Quarter Ended				Quarter Ended				Quarter Ended				Quarter Ended				Quarter Ended
					6/30/2023				3/31/2023				12/31/2022				9/30/2022				6/30/2022
					Amount		Ratio		Amount		Ratio		Amount		Ratio		Amount		Ratio		Amount		Ratio
Actual
(dollars in thousands)
Total Capital (to risk-weighted assets)					$ 60,017		13.41 %		$ 60,210		14.03 %		$ 61,909		15.45 %		$ 61,370		16.26 %		$ 60,713		16.87 %
Tier 1 Capital (to risk-weighted assets)					$ 55,886		12.48 %		$ 56,154		13.09 %		$ 58,490		14.60 %		$ 58,209		15.42 %		$ 57,781		16.05 %
Tier 1 Capital (to average assets)					$ 55,886		11.11 %		$ 56,154		11.73 %		$ 58,490		12.44 %		$ 58,209		13.06 %		$ 57,781		13.67 %
Minimum To Be Well-Capitalized Under
Prompt Corrective Action Provisions
(dollars in thousands)
Total Capital (to risk-weighted assets)					$ 45,000		10.00 %		$ 43,000		10.00 %		$ 40,000		10.00 %		$ 38,000		10.00 %		$ 36,000		10.00 %
Tier 1 Capital (to risk-weighted assets)					$ 36,000		8.00 %		$ 34,000		8.00 %		$ 32,000		8.00 %		$ 30,000		8.00 %		$ 29,000		8.00 %
Tier 1 Capital (to average assets)					$ 25,000		5.00 %		$ 24,000		5.00 %		$ 24,000		5.00 %		$ 22,000		5.00 %		$ 21,000		5.00 %

 

Triad Business Bank
Non-GAAP Measures (Unaudited)
Tangible Book Value
								Actual    6/30/2023		Non-GAAP 6/30/2023
Total Shareholders' Equity								$       36,639,993		$       36,639,993
Eliminate Deferred Tax Asset Valuation Allowance								-		2,258,470
Eliminate Accumulated Other Comprehensive Loss								-		19,246,063
Adjusted Shareholders' Equity								$       36,639,993		$       58,144,526
Shares Outstanding								6,693,965		6,693,965
Tangible Book Value per Share								$                  5.47		$                  8.69
Effect of Non-GAAP Measures on Tangible Book Value										$                  3.22
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 June 30, 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 (Loss)
								Qtr Ended 6/30/2023		Qtr Ended 6/30/2022
Income (Loss) Before Income Tax								$           (436,253)		$             (83,322)
Provision for Loan Losses								74,526		229,529
Pre-provision Income (Loss) Before Income Tax (Non-GAAP)								$           (361,727)		$            146,207
The pre-provision income (loss) is a measure of operating performance exclusive of potential losses from lending.

 

 

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