Peapack-Gladstone Financial Corporation Reports Fourth Quarter Results
BEDMINSTER, NJ, Jan. 25, 2024 (GLOBE NEWSWIRE) -- via NewMediaWire *–* Peapack-Gladstone Financial Corporation (*NASDAQ Global Select Market: PGC*) (the “Company”) announces its fourth quarter 2023 financial results.*This earnings release should be read in conjunction with the Company’s Q4 2023 Investor Update, a copy of which is available on our website at **www.pgbank.com** and via a current report on Form 8-K on the website of the Securities and Exchange Commission at www.sec.gov. *
The Company recorded total revenue of $54.3 million, net income of $8.6 million and diluted earnings per share (“EPS”) of $0.48 for the quarter ended December 31, 2023, compared to revenue of $64.9 million, net income of $20.6 million and diluted EPS of $1.12 for the quarter ended December 31, 2022.
The net interest margin stabilized at 2.29% for the quarter ended December 31, 2023, compared to 2.28% for the quarter ended September 30, 2023 and 3.12% for the quarter ended December 31, 2022.
The Company’s return on average assets was 0.53%, return on average equity was 6.13%, and return on average tangible equity was 6.68% for the quarter ended December 31, 2023. Year over year deposits increased by $69.0 million to $5.3 billion and loans grew $135.2 million to $5.4 billion as of December 31, 2023.
The Company’s liquidity position remains stable as balance sheet liquidity (consisting of cash and cash equivalents and securities available for sale) increased to $782.4 million as of December 31, 2023, which was 12.08% of total assets. The Company also had $2.7 billion of external borrowing capacity available, which, when combined with balance sheet liquidity provides us with 297% coverage of our uninsured deposits. Approximately 78% of our deposits are presently covered by FDIC insurance or are fully collateralized.
Douglas L. Kennedy, President and CEO said, “The fourth quarter brings an end to an incredibly challenging year for the financial services industry. A year that began with questions regarding liquidity and uninsured deposit balances combined with several interest rate increases by the Federal Reserve Bank in an effort to control inflation, which resulted in a turbulent ride from beginning to end. Our net interest margin stabilized during the fourth quarter which provides an encouraging sign as we turn the calendar to 2024. We continue to generate a consistent stream of noninterest income led by our Wealth Management Team. Noninterest income represented 32% of total revenue during 2023."
Mr. Kennedy also noted, “Similar to the third quarter, fourth quarter results included an elevated provision for credit losses primarily driven by reserves required for two credits within the freight industry, which is currently facing a massive downturn due to supply and demand imbalances. We successfully liquidated one of these credits during the fourth quarter and continue to work through steps to quickly resolve the other. As we move forward through this challenging economic environment, we continue to thoroughly analyze our loan portfolio for areas of concern. We believe the diversity of our portfolio and strength of our underwriting standards will protect us in the long term. Unfortunately, we have been forced to deal with a handful of credit issues that have arisen as a result of current economic conditions."
The following are select highlights for the period ended December 31, 2023:
*Wealth Management:*
· Gross new business inflows for Q4 2023 totaled $260 million ($156 million managed). Full year 2023, gross business inflows totaled $948 million ($703 million managed).
· AUM/AUA in our Wealth Management Division totaled $10.9 billion at December 31, 2023 when compared to $9.9 billion at December 31, 2022, which is an increase of 10% year over year.
· Wealth Management fee income of $13.8 million for Q4 2023 comprised 25% of total revenue for the quarter.
*Commercial Banking and Balance Sheet Management: *
· Total loans were $5.4 billion at December 31, 2023 reflecting growth of $135.2 million when compared to $5.3 billion at December 31, 2022.
· Commercial & industrial lending (“C&I”) loan/lease balances remained at 42% of the total loan portfolio at December 31, 2023.
· Fee income on unused commercial lines of credit totaled $750,000 for Q4 2023.
· Fee income recorded by the Equipment Finance division related to equipment transfers to lessees totaled $309,000 for Q4 2023.
· The net interest margin ("NIM") was 2.29% in Q4 2023, an increase of 1 basis point compared to Q3 2023 and a decline of 83 basis points when compared to Q4 2022.
· Total deposits increased $69.0 million to $5.3 billion from December 31, 2022.
· Noninterest-bearing demand deposits represented 18% of total deposits as of December 31, 2023.
· Core deposits (which includes noninterest-bearing demand and interest-bearing demand, savings and money market accounts) totaled 89% of total deposits at December 31, 2023.
*Capital Management:*
· Tangible book value per share increased 5% on a linked quarter basis or $1.54 per share, in Q4 2023 to $30.31.
· During the quarter, the Company repurchased 88,327 shares of Company stock for a cost of $2.1 million. For 2023, the Company repurchased 455,341 shares for a cost of $12.5 million. The Company repurchased 930,977 shares of stock for a cost of $32.7 million during the year ended December 31, 2022.
· At December 31, 2023, the Tier 1 Leverage Ratio stood at 10.83% for Peapack-Gladstone Bank (the "Bank") and 9.19% for the Company. The Common Equity Tier 1 Ratio (to Risk-Weighted Assets) stood at 13.47% for the Bank and 11.43% for the Company at December 31, 2023. These ratios are significantly above well capitalized standards, as capital has benefited from net income generation.
*Non-Core Items:*
The December 2023 quarter included a:
· $585,000 positive fair value adjustment on an equity security held for CRA investment, which increased total revenue by $585,000, increased net income by $418,000 and EPS by $0.02 for the December 2023 quarter. Management believes this to be a non-core item.
*SUMMARY INCOME STATEMENT DETAILS:*
The following tables summarize specified financial details for the periods shown.
*December 2023 Year Compared to Prior Year*
* * * * *Year Ended* * * * * *Year Ended* * * * * * * * * * * * * * * * *
* * * * *December 31,* * * * * *December 31,* * * * * * * *Increase/* * *
*(Dollars in millions, except per share data)* * * *2023* * * * * *2022* * * * * * * *(Decrease)* * *
Net interest income $ 156.09 $ 176.08 $ (19.99 ) (11 )%
Wealth management fee income 55.75 54.65 1.10 2
Capital markets activity (A) 2.74 9.25 (6.51 ) (70 )
Other income (B) 15.09 2.52 12.57 499
Total other income 73.58 66.42 7.16 11
Total Revenue 229.67 242.50 (12.83 ) (5 )%
Operating expenses (C) 148.30 133.80 14.50 11
Pretax income before provision for credit losses 81.37 108.70 (27.33 ) (25 )
Provision for credit losses 14.09 6.35 7.74 122
Pretax income 67.28 102.35 (35.07 ) (34 )
Income tax expense 18.43 28.10 (9.67 ) (34 )
Net income $ 48.85 $ 74.25 $ (25.40 ) (34 )%
Diluted EPS $ 2.71 $ 4.00 $ (1.29 ) (32 )%
Return on average assets 0.76 % 1.20 % (0.44 )
Return on average equity 8.77 % 14.02 % (5.25 )
(A) The twelve months ended December 31, 2023 was negatively impacted by both market volatility and the higher interest rate environment resulting in lower SBA sale premiums and origination volumes. The twelve months ended December 31, 2023 had a decline in gain on sale of SBA loans of $4.3 million to $2.4 million when compared to the same period in 2022.
(B) Other income for the year ended December 31, 2023 included fee income from equipment finance activity of $3.0 million and a positive fair value adjustment on a CRA equity security of $181,000. Other income for the year ended December 31, 2022 included a $6.6 million loss on sale of securities, gain on sale of property of $275,000 income from life insurance proceeds of $25,000 and a negative fair value adjustment on a CRA equity security of $1.7 million.
(C) The year ended December 31, 2023 included one-time charges of $2.0 million related to the recent retirement of certain employees and $175,000 of expense associated with three retail branch closures. The year ended December 31, 2022 included $1.5 million of severance expense related to certain staff reorganizations and $673,000 of expense related to the swap valuation allowance.
*December 2023 Quarter Compared to Prior Year Quarter*
* * * * *Three Months Ended* * * * * * * *Three Months Ended* * * * * * * * * * * * * * *
* * * * *December 31,* * * * * * * *December 31,* * * * * *Increase/* * *
*(Dollars in millions, except per share data)* * * *2023* * * * * *2022* * * * * *(Decrease)* * *
Net interest income $ 36.68 $ 48.04 $ (11.36 ) (24 )%
Wealth management fee income 13.76 12.98 0.78 6
Capital markets activity 0.30 0.95 (0.65 ) (68 )
Other income (A) 3.53 2.88 0.65 23
Total other income 17.59 16.81 0.78 5
Total Revenue 54.27 64.85 (10.58 ) (16 )%
Operating expenses 37.62 33.41 4.21 13
Pretax income before provision for credit losses 16.65 31.44 (14.79 ) (47 )
Provision for credit losses 5.03 1.93 3.10 161
Pretax income 11.62 29.51 (17.89 ) (61 )
Income tax expense (B) 3.02 8.93 (5.91 ) (66 )
Net income $ 8.60 $ 20.58 $ (11.98 ) (58 )%
Diluted EPS $ 0.48 $ 1.12 $ (0.64 ) (57 )%
Return on average assets annualized 0.53 % 1.33 % (0.80 )
Return on average equity annualized 6.13 % 15.73 % (9.60 )
(A) Other income for the December 2023 quarter included a positive fair value adjustment on a CRA equity security of $585,000. Other income for the December 2022 quarter included a gain on sale of property of $275,000, income from life insurance proceeds of $25,000 and a positive fair value adjustment on a CRA equity security of $28,000.
(B) The three months ended December 31, 2022 included $750,000 of income tax expense (net of Federal benefit) related to legislation that changed the nexus standard for New York City business tax. ($563,000 of that amount related to the first nine months of 2022).
*December 2023 Quarter Compared to Linked Quarter
*
* * * * *Three Months Ended* * * * * *Three Months Ended* * * * * * * * * * * * * * * * *
* * * * *December 31,* * * * * *September* * * * * * * *Increase/* * *
*(Dollars in millions, except per share data)* * * *2023* * * * * *2023* * * * * * * *(Decrease)* * *
Net interest income $ 36.68 $ 36.52 $ 0.16 %
Wealth management fee income 13.76 13.98 (0.22 ) (2 )
Capital markets activity 0.30 0.61 (0.31 ) (51 )
Other income (A) 3.53 4.76 (1.23 ) (26 )
Total other income 17.59 19.35 (1.76 ) (9 )
Total Revenue 54.27 55.87 (1.60 ) (3 )%
Operating expenses 37.62 37.41 0.21 1
Pretax income before provision for credit losses 16.65 18.46 (1.81 ) (10 )
Provision for credit losses 5.03 5.86 (0.83 ) (14 )
Pretax income 11.62 12.60 (0.98 ) (8 )
Income tax expense 3.02 3.84 (0.82 ) (21 )
Net income $ 8.60 $ 8.76 $ (0.16 ) (2 )%
Diluted EPS $ 0.48 $ 0.49 $ (0.01 ) (2 )%
Return on average assets annualized 0.53 % 0.54 % (0.01 )
Return on average equity annualized 6.13 % 6.20 % (0.07 )
(A) Other income for the December 2023 quarter included a positive fair value adjustment on a CRA equity security of $585,000. Other income for the September 2023 quarter included fee income from equipment finance activity of $2.3 million and a negative fair value adjustment on a CRA equity security of $404,000.
*SUPPLEMENTAL QUARTERLY DETAILS:*
*Wealth Management *
AUM/AUA in the Bank’s Wealth Management Division were $10.9 billion at December 31, 2023. For the December 2023 quarter, the Wealth Management Team generated $13.8 million in fee income, compared to $14.0 million for the September 30, 2023 quarter and $13.0 million for the December 2022 quarter. The equity market increased during Q4 2023, contributing to the increase in AUM/AUA from $10.4 billion at September 30, 2023.
John Babcock, President of the Bank's Wealth Management Division, noted, “2023 included total new accounts and client additions of $948 million ($703 million managed). As we prepare for 2024, our new business pipeline is healthy and we remain focused on delivering excellent service and advice to our clients. Our highly skilled wealth management professionals, our fiduciary powers and expertise, our financial planning capabilities and our high-touch client service model distinguishes us in our market and continues to drive our growth and success.”
*Loans / Commercial Banking *
Total loans grew $135.2 million, or 3% to $5.4 billion at December 31, 2023 when compared to $5.3 billion at December 31, 2022.
Total C&I loans and leases at December 31, 2023 were $2.3 billion or 42% of the total loan portfolio.
Mr. Kennedy noted, “As previously mentioned, we have tightened our underwriting guidelines due to economic uncertainty. As a result, we achieved modest loan growth in 2023 compared to prior years. We are proud to have built a leading middle market commercial banking franchise, as evidenced by our C&I Portfolio, Treasury Management services, Corporate Advisory and SBA businesses. We believe these business lines fit perfectly with our private banking business model.”
*Net Interest Income (NII)/Net Interest Margin (NIM)*
The Company’s NII of $36.7 million and NIM of 2.29% for Q4 2023 increased $160,000 and 1 basis point from NII of $36.5 million and NIM of 2.28% for the linked quarter (Q3 2023), respectively, and decreased $11.4 million and 83 basis points from NII of $48.0 million and NIM of 3.12% for the prior year (Q4 2022), respectively. When comparing Q4 2023 to the prior year quarter, the Company has seen a sharp increase in interest expense mostly driven by higher deposit rates during 2023. Cycle to date betas are approximately 48%. Clients continue to migrate out of noninterest bearing checking products and into higher costing alternatives, which leads to intense competition for deposit balances from other banks and alternative investment opportunities due to the significant rise in interest rates.
*Funding / Liquidity / Interest Rate Risk Management*
Total deposits increased $69.0 million to $5.3 billion at December 31, 2023 from $5.2 billion at December 31, 2022. The Company saw limited deposit increases in 2023 as the ongoing acquisition of new relationships driven by our private banking strategy was offset by larger deposit relationships using funds for purposes such as deployment of excess liquidity into higher-yielding treasuries or the equity market, tax payments, or asset acquisitions or investments. The Company has also seen clients transition money from noninterest bearing deposit accounts to higher yielding deposit accounts as a result of increases in the Fed Funds rate.
At December 31, 2023, the Company’s balance sheet liquidity (investments available for sale, interest-earning deposits and cash) totaled $782.4 million, or 12% of assets.
The Company maintains additional liquidity resources of approximately $2.7 billion through secured available funding with the Federal Home Loan Bank and the Federal Reserve Discount Window. The available funding from the Federal Home Loan Bank and the Federal Reserve are secured by the Company’s loan and investment portfolios. In addition, the Company also has access to the Bank Term Funding Program offered by the Federal Reserve Bank if needed.
The Company's total on and off-balance sheet liquidity totaled $3.5 billion, which is 297% of the total uninsured/uncollateralized deposits on the Company's balance sheet.
*Income from Capital Markets Activities*
Noninterest income from Capital Markets activities (detailed below) totaled $296,000 for the December 2023 quarter compared to $613,000 for the September 2023 quarter and $950,000 for the December 2022 quarter. The gain on sale of SBA loans was lower in Q4 2023 due to less activity in the higher interest rate environment and tighter margins.
* * * * *Three Months Ended* * * * * *Three Months Ended* * * * * *Three Months Ended* * *
* * * * *December 31,* * * * * *September 30,* * * * * *December 31,* * *
*(Dollars in thousands, except per share data)* * * *2023* * * * * *2023* * * * * *2022* * *
Gain on loans held for sale at fair value (Mortgage banking) $ 18 $ 37 $ 25
Fee income related to loan level, back-to-back swaps — — 293
Gain on sale of SBA loans 239 491 624
Corporate advisory fee income 39 85 8
Total capital markets activity $ 296 $ 613 $ 950
*Other Noninterest Income (other than Wealth Management Fee Income and Income from Capital Markets Activities)*
Other noninterest income was $3.5 million for Q4 2023 compared to $4.8 million for Q3 2023 and $2.9 million for Q4 2022. Q4 2023 included $309,000 of income recorded by the Equipment Finance Division related to equipment transfers to lessees upon the termination of leases while Q3 2023 included $2.3 million and Q4 2022 included $294,000 respectively. Additionally, Q4 2023 included $750,000 of unused line fees compared to $794,000 for Q3 2023 and $732,000 for Q4 2022.
*Operating Expenses*
The Company’s total operating expenses were $37.6 million for the fourth quarter of 2023, compared to $37.4 million for the September 2023 quarter and $33.4 million for the December 2022 quarter. The December 2023 and September 2023 quarters included expenses associated with the expansion of the Company into New York City.
Mr. Kennedy noted, “While we have made a strategic decision to expand into a new market which results in additional costs, we are pleased with our ability to manage expenses across the Company. We will continue to look for opportunities to create efficiencies while investing in digital and other software tools to further enhance the client experience.”
*Income Taxes*
The effective tax rate for the three months ended December 31, 2023 was 26.0%, as compared to 30.5% for the September 2023 quarter and 30.3% for the quarter ended December 31, 2022. The higher tax rate for the September 2023 quarter was primarily due to the impact of certain non-deductible expenses related to compensation and benefits and the higher tax rate for the December 2022 quarter included income tax expense related to legislation that changed the nexus standard for New York City business tax.
*Asset Quality / Provision for Credit Losses*
Nonperforming assets (which does not include modified loans that are performing in accordance with their terms) were $61.3 million, or 0.95% of total assets at December 31, 2023, as compared to $70.8 million, or 1.09% of total assets at September 30, 2023. The third quarter was impacted by two freight related clients totaling $33.4 million that were transferred to nonaccrual status during the third quarter. One credit, totaling $9.9 million, was successfully liquidated during the fourth quarter and management is working diligently to resolve the remaining matter as quickly and efficiently as possible. Loans past due 30 to 89 days and still accruing were $34.6 million, or 0.64% of total loans at December 31, 2023 compared to $9.8 million, or 0.18% of total loans at September 30, 2023. The Q4 2023 loans past due 30 to 89 days and still accruing included $16.5 million to US governmental entities and $11.8 million to one multifamily sponsor.
Criticized and classified loans totaled $155.8 million at December 31, 2023, reflecting an increase from September 30, 2023 and December 31, 2022 levels. The Company currently has no loans or leases on deferral and accruing.
For the quarter ended December 31, 2023, the Company’s provision for credit losses was $5.1 million compared to $5.9 million for the September 2023 quarter and $2.1 million for the December 2022 quarter. The elevated level of provision for credit losses in both the December and September 2023 quarters was primarily driven by specific provisions related to the two freight credits that were transferred to nonaccrual status during the third quarter of 2023 as described above. Net charge-offs for the quarter ended December 31, 2023 included charge-offs of $2.2 million of a previously established reserve to loans individually evaluated on one multifamily loan and $5.6 million on one equipment finance relationship.
At December 31, 2023, the allowance for credit losses was $65.9 million (1.21% of total loans), compared to $68.6 million (1.25% of loans) at September 30, 2023, and $60.8 million (1.15% of loans) at December 31, 2022.
*Capital *
The Company’s capital position benefited by net income of $8.6 million during the December 2023 quarter, which was partially offset by the repurchase of 88,327 shares through the Company's stock repurchase program at a total cost of $2.1 million and the quarterly dividend of $891,000. Additionally, during the fourth quarter of 2023, the Company recorded a net gain in accumulated other comprehensive loss of $16.8 million, net of tax. This amount was driven by a $21.2 million increase in the value of the available for sale securities portfolio partially offset by a $4.4 million loss on cash flow hedges. The total accumulated other comprehensive loss declined to $64.9 million as of December 31, 2023, ($69.8 million loss related to the available for sale securities portfolio partially offset by a $4.9 million gain on the cash flow hedges)
Tangible book value per share increased during Q4 2023 to $30.31 at December 31, 2023 from $28.77 at September 30, 2023. Tangible book value per share is a non-GAAP financial measure. See the reconciliation tables included in this release. The Company’s and Bank’s regulatory capital ratios as of December 31, 2023 remain strong, and generally reflect increases from December 31, 2022 levels. Where applicable, such ratios remain well above regulatory well capitalized standards.
The Company employs quarterly capital stress testing modeling of an adverse case and severely adverse case. In the most recently completed stress test (as of September 30, 2023), under the severely adverse case, and no growth scenario, the Bank remains well capitalized over a two-year stress period.
On December 19, 2023, the Company declared a cash dividend of $0.05 per share payable on February 23, 2024 to shareholders of record on February 8, 2024.
*ABOUT THE COMPANY*
Peapack-Gladstone Financial Corporation is a New Jersey bank holding company with total assets of $6.5 billion and assets under management/administration of $10.9 billion as of December 31, 2023. Founded in 1921, Peapack-Gladstone Bank is a commercial bank that provides Private Banking customized solutions through its wealth management, commercial and retail solutions, including residential lending and online platforms, to businesses and consumers. Peapack Private, the bank’s wealth management division, offers comprehensive financial, tax, fiduciary and investment advice and solutions to individuals, families, privately-held businesses, family offices and not-for-profit organizations, which help them to establish, maintain and expand their legacy. Together, Peapack-Gladstone Bank and Peapack Private offer an unparalleled commitment to client service. Visit www.pgbank.com and www.peapackprivate.com for more information.
*FORWARD-LOOKING STATEMENTS*
The foregoing may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are not historical facts and include expressions about management’s confidence and strategies and management’s expectations about new and existing programs and products, investments, relationships, opportunities and market conditions. These statements may be identified by such forward-looking terminology as “expect,” “look,” “believe,” “anticipate,” “may” or similar statements or variations of such terms. Actual results may differ materially from such forward-looking statements. Factors that may cause results to differ materially from such forward-looking statements include, but are not limited to:
· our ability to successfully grow our business and implement our strategic plan, including our ability to generate revenues to offset the increased personnel and other costs related to the strategic plan;
· the impact of anticipated higher operating expenses in 2024 and beyond;
· our ability to successfully integrate wealth management firm acquisitions;
· our ability to successfully integrate our expanded employee base;
· an unexpected decline in the economy, in particular in our New Jersey and New York market areas, including potential recessionary conditions;
· declines in our net interest margin caused by the interest rate environment and/or our highly competitive market;
· declines in the value in our investment portfolio;
· impact from a pandemic event on our business, operations, customers, allowance for credit losses and capital levels;
· the continuing impact of the COVID-19 pandemic on our business and results of operation;
· higher than expected increases in our allowance for credit losses;
· higher than expected increases in credit losses or in the level of delinquent, nonperforming, classified and criticized loans;
· inflation and changes in interest rates, which may adversely impact our margins and yields, reduce the fair value of our financial instruments, reduce our loan originations and lead to higher operating costs;
· decline in real estate values within our market areas;
· legislative and regulatory actions (including the impact of the Dodd-Frank Wall Street Reform and Consumer Protection Act, Basel III and related regulations) that may result in increased compliance costs;
· a potential government shutdown;
· successful cyberattacks against our IT infrastructure and that of our IT and third-party providers;
· higher than expected FDIC insurance premiums;
· adverse weather conditions;
· the current or anticipated impact of military conflict, terrorism or other geopolitical events;
· our inability to successfully generate new business in new geographic markets, including our expansion into New York City;
· a reduction in our lower-cost funding sources;
· changes in liquidity, including the size and composition of our deposit portfolio, including the percentage of uninsured deposits in the portfolio;
· our inability to adapt to technological changes;
· claims and litigation pertaining to fiduciary responsibility, environmental laws and other matters;
· our inability to retain key employees;
· demands for loans and deposits in our market areas;
· adverse changes in securities markets;
· changes in governmental regulation, including, but not limited to, any increase in FDIC insurance premiums and changes in the monetary policies of the U.S. Treasury and the Board of Governors of the Federal Reserve System;
· changes in accounting policies and practices; and/or
· other unexpected material adverse changes in our operations or earnings.
A discussion of these and other factors that could affect our results is included in our SEC filings, including our Annual Report on Form 10-K for the year ended December 31, 2022. We undertake no duty to update any forward-looking statement to conform the statement to actual results or changes in the Company’s expectations.
Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements.
*Contact:*
Frank A. Cavallaro, SEVP and CFO
Peapack-Gladstone Financial Corporation
T: 908-306-8933
* (Tables to follow)*
*PEAPACK-GLADSTONE FINANCIAL CORPORATION*
*SELECTED CONSOLIDATED FINANCIAL DATA*
*(Dollars in Thousands, except per share data)*
* (Unaudited)*
* * * * *For the Three Months Ended* * *
* * * * *Dec 31,* * * * * *Sept 30,* * * * * *June 30,* * * * * *March 31,* * * * * *Dec 31,* * *
* * * * *2023* * * * * *2023* * * * * *2023* * * * * *2023* * * * * *2022* * *
*Income Statement Data:*
Interest income $ 80,178 $ 78,489 $ 74,852 $ 70,491 $ 64,202
Interest expense 43,503 41,974 35,931 26,513 16,162
Net interest income 36,675 36,515 38,921 43,978 48,040
Wealth management fee income 13,758 13,975 14,252 13,762 12,983
Service charges and fees 1,255 1,319 1,320 1,258 1,150
Bank owned life insurance 357 310 305 297 321
Gain on loans held for sale at fair value (Mortgage banking) 18 37 15 21 25
Fee income related to loan level, back-to-back swaps — — — — 293
Gain on sale of SBA loans 239 491 838 865 624
Corporate advisory fee income 39 85 15 80 8
Other income (A) 1,339 3,541 2,039 1,567 1,380
Fair value adjustment for CRA equity security 585 (404 ) (209 ) 209 28
Total other income 17,590 19,354 18,575 18,059 16,812
Total revenue 54,265 55,869 57,496 62,037 64,852
Salaries and employee benefits (B) 24,320 25,264 26,354 24,586 22,489
Premises and equipment 5,416 5,214 4,729 4,374 4,898
FDIC insurance expense 765 741 729 711 455
Other expenses 7,115 6,194 5,880 5,903 5,570
Total operating expenses 37,616 37,413 37,692 35,574 33,412
Pretax income before provision for credit losses 16,649 18,456 19,804 26,463 31,440
Provision for credit losses 5,026 5,856 1,696 1,513 1,930
Income before income taxes 11,623 12,600 18,108 24,950 29,510
Income tax expense (C) 3,024 3,845 4,963 6,595 8,931
Net income $ 8,599 $ 8,755 $ 13,145 $ 18,355 $ 20,579
*Per Common Share Data:*
Earnings per share (basic) $ 0.48 $ 0.49 $ 0.73 $ 1.03 $ 1.15
Earnings per share (diluted) 0.48 0.49 0.73 1.01 1.12
*Weighted average number of common shares outstanding:*
Basic 17,770,158 17,856,961 17,930,611 17,841,203 17,915,058
Diluted 17,961,400 18,010,127 18,078,848 18,263,310 18,382,193
*Performance Ratios:*
Return on average assets annualized (ROAA) 0.53 % 0.54 % 0.82 % 1.16 % 1.33 %
Return on average equity annualized (ROAE) 6.13 % 6.20 % 9.43 % 13.50 % 15.73 %
Return on average tangible equity annualized (ROATCE) (D) 6.68 % 6.75 % 10.30 % 14.78 % 17.30 %
Net interest margin (tax-equivalent basis) 2.29 % 2.28 % 2.49 % 2.88 % 3.12 %
GAAP efficiency ratio (E) 69.32 % 66.97 % 65.56 % 57.34 % 51.52 %
Operating expenses / average assets annualized 2.33 % 2.31 % 2.36 % 2.26 % 2.15 %
(A) The September 2023 quarter included $2.3 million of fee income from equipment finance activity.
(B) The June 2023 quarter included $1.7 million of expense associated with the recent retirement of certain employees.
(C) The three months ended December 31, 2022 included $750,000 of income tax expense (net federal benefit) related to a recent New York City nexus determination change which included $563,000 from prior quarters.
(D) Return on average tangible equity is calculated by dividing tangible equity by annualized net income. See Non-GAAP financial measures reconciliation included in these tables.
(E) Calculated as total operating expenses as a percentage of total revenue. For Non-GAAP efficiency ratio, see the Non-GAAP financial measures reconciliation included in these tables.
*PEAPACK-GLADSTONE FINANCIAL CORPORATION*
*SELECTED CONSOLIDATED FINANCIAL DATA*
*(Dollars in Thousands, except share data)*
*(Unaudited)*
*For the Twelve Months Ended* * *
* * * * *December 31,* * * * * *Change* * *
* * * * *2023* * * * * *2022* * * * * *$* * * * * *%* * *
*Income Statement Data:*
Interest income $ 304,010 $ 211,875 $ 92,135 43 %
Interest expense 147,921 35,795 112,126 313 %
Net interest income 156,089 176,080 (19,991 ) -11 %
Wealth management fee income 55,747 54,651 1,096 2 %
Service charges and fees 5,152 4,225 927 22 %
Bank owned life insurance 1,269 1,243 26 2 %
Gain on loans held for sale at fair value (Mortgage banking) 91 483 (392 ) -81 %
Fee income related to loan level, back-to-back swaps — 293 (293 ) -100 %
Gain on sale of SBA loans 2,433 6,765 (4,332 ) -64 %
Corporate advisory fee income 219 1,704 (1,485 ) -87 %
Other income (A) 8,486 5,362 3,124 58 %
Loss on securities sale, net (B) — (6,609 ) 6,609 -100 %
Fair value adjustment for CRA equity security 181 (1,700 ) 1,881 -111 %
Total other income 73,578 66,417 7,161 11 %
Total revenue 229,667 242,497 (12,830 ) -5 %
Salaries and employee benefits (C) 100,524 89,476 11,048 12 %
Premises and equipment 19,733 18,719 1,014 5 %
FDIC insurance expense 2,946 1,939 1,007 52 %
Swap valuation allowance — 673 (673 ) -100 %
Other expenses 25,092 22,993 2,099 9 %
Total operating expenses 148,295 133,800 14,495 11 %
Pretax income before provision for credit losses 81,372 108,697 (27,325 ) -25 %
Provision for credit losses 14,091 6,353 7,738 122 %
Income before income taxes 67,281 102,344 (35,063 ) -34 %
Income tax expense 18,427 28,098 (9,671 ) -34 %
Net income $ 48,854 $ 74,246 $ (25,392 ) -34 %
*Per Common Share Data:*
Earnings per share (basic) $ 2.74 $ 4.09 $ (1.35 ) -33 %
Earnings per share (diluted) 2.71 4.00 (1.29 ) -32 %
*Weighted average number of common shares outstanding:*
Basic 17,849,558 18,161,605 (312,047 ) -2 %
Diluted 18,049,052 18,568,098 (519,046 ) -3 %
*Performance Ratios:*
Return on average assets (ROAA) 0.76 % 1.20 % (0.44 )% -36 %
Return on average equity (ROAE) 8.77 % 14.02 % (5.25 )% -37 %
Return on average tangible equity (ROATCE) (D) 9.57 % 15.43 % (5.86 )% -38 %
Net interest margin (tax-equivalent basis) 2.48 % 2.91 % (0.43 )% -15 %
GAAP efficiency ratio (E) 64.57 % 55.18 % 9.39 % 17 %
Operating expenses / average assets 2.32 % 2.16 % 0.16 % 7 %
(A) The twelve months ended December 2023 included $3.0 million of fee income from equipment finance activity.
(B) Loss on sale of securities was a result of a balance sheet repositioning employed in the March 2022 quarter.
(C) The twelve months ended December 31, 2023 included $2.0 million of expense associated with the recent retirement of certain employees, increased corporate and health insurance costs and expenses associated with the previously announced expansion into New York City. The twelve months ended December 31, 2022 quarter included $1.5 million of severance expense related to corporate restructuring.
(D) Return on average tangible equity is calculated by dividing tangible equity by annualized net income. See Non-GAAP financial measures reconciliation included in these tables.
(E) Calculated as total operating expenses as a percentage of total revenue. For Non-GAAP efficiency ratio, see the Non-GAAP financial measures reconciliation included in these tables.
*PEAPACK-GLADSTONE FINANCIAL CORPORATION*
*CONSOLIDATED STATEMENTS OF CONDITION*
*(Dollars in Thousands)*
*(Unaudited)*
*As of* * *
* * * * *Dec 31,* * * * * *Sept 30,* * * * * *June 30,* * * * * *March 31,* * * * * *Dec 31,* * *
* * * * *2023* * * * * *2023* * * * * *2023* * * * * *2023* * * * * *2022* * *
ASSETS
Cash and due from banks $ 5,887 $ 7,400 $ 4,859 $ 6,514 $ 5,937
Federal funds sold — — — — —
Interest-earning deposits 181,784 180,469 166,769 244,779 184,138
Total cash and cash equivalents 187,671 187,869 171,628 251,293 190,075
Securities available for sale 550,617 521,005 540,519 556,266 554,648
Securities held to maturity 107,755 108,940 110,438 111,609 102,291
CRA equity security, at fair value 13,166 12,581 12,985 13,194 12,985
FHLB and FRB stock, at cost (A) 31,044 34,158 35,402 30,338 30,672
Residential mortgage 578,427 585,295 575,238 544,655 525,756
Multifamily mortgage 1,836,390 1,871,853 1,884,369 1,871,387 1,863,915
Commercial mortgage 637,625 622,469 624,710 613,911 624,625
Commercial and industrial loans 2,284,940 2,321,917 2,278,133 2,266,837 2,213,762
Consumer loans 62,036 57,227 52,098 49,002 38,014
Home equity lines of credit 36,464 34,411 34,397 33,294 34,496
Other loans 238 265 269 443 304
Total loans 5,436,120 5,493,437 5,449,214 5,379,529 5,300,872
Less: Allowance for credit losses 65,888 68,592 62,704 62,250 60,829
Net loans 5,370,232 5,424,845 5,386,510 5,317,279 5,240,043
Premises and equipment 24,166 23,969 23,814 23,782 23,831
Other real estate owned — — — 116 116
Accrued interest receivable 30,676 22,889 20,865 19,143 25,157
Bank owned life insurance 47,581 47,509 47,382 47,261 47,147
Goodwill and other intangible assets 46,014 46,286 46,624 46,979 47,333
Finance lease right-of-use assets 2,087 2,274 2,461 2,648 2,835
Operating lease right-of-use assets 12,096 12,800 13,500 12,262 12,873
Other assets 53,752 76,456 67,572 47,848 63,587
TOTAL ASSETS $ 6,476,857 $ 6,521,581 $ 6,479,700 $ 6,480,018 $ 6,353,593
LIABILITIES
Deposits:
Noninterest-bearing demand deposits $ 957,687 $ 947,405 $ 1,024,105 $ 1,096,549 $ 1,246,066
Interest-bearing demand deposits 2,882,193 2,871,359 2,816,913 2,797,493 2,143,611
Savings 111,573 117,905 120,082 132,523 157,338
Money market accounts 740,559 761,833 763,026 873,329 1,228,234
Certificates of deposit – Retail 443,791 422,291 384,106 357,131 318,573
Certificates of deposit – Listing Service 7,804 9,103 10,822 15,922 25,358
Subtotal “customer” deposits 5,143,607 5,129,896 5,119,054 5,272,947 5,119,180
IB Demand – Brokered 10,000 10,000 10,000 10,000 60,000
Certificates of deposit – Brokered 120,507 119,463 69,443 25,895 25,984
Total deposits 5,274,114 5,259,359 5,198,497 5,308,842 5,205,164
Short-term borrowings 403,814 470,576 485,360 378,800 379,530
Finance lease liability 3,430 3,752 4,071 4,385 4,696
Operating lease liability 12,876 13,595 14,308 13,082 13,704
Subordinated debt, net 133,274 133,203 133,131 133,059 132,987
Due to brokers — — — 8,308 —
Other liabilities 65,668 82,140 79,264 78,584 84,532
TOTAL LIABILITIES 5,893,176 5,962,625 5,914,631 5,925,060 5,820,613
Shareholders’ equity 583,681 558,956 565,069 554,958 532,980
TOTAL LIABILITIES AND
SHAREHOLDERS’ EQUITY $ 6,476,857 $ 6,521,581 $ 6,479,700 $ 6,480,018 $ 6,353,593
*Assets under management and / or administration at Peapack-Gladstone Bank’s Private Wealth Management Division (market value, not included above-dollars in billions)* $ 10.9 $ 10.4 $ 10.7 $ 10.4 $ 9.9
(A) FHLB means "Federal Home Loan Bank" and FRB means "Federal Reserve Bank."
.
*PEAPACK-GLADSTONE FINANCIAL CORPORATION*
*SELECTED BALANCE SHEET DATA*
*(Dollars in Thousands)*
*(Unaudited)*
* * * * *As of* * *
* * * * *Dec 31,* * * * * *Sept 30,* * * * * *June 30,* * * * * *March 31,* * * * * *Dec 31,* * *
* * * * *2023* * * * * *2023* * * * * *2023* * * * * *2023* * * * * *2022* * *
*Asset Quality:* * *
Loans past due over 90 days and still accruing $ — $ — $ — $ — $ —
Nonaccrual loans (A) 61,324 70,809 34,505 28,659 18,974
Other real estate owned — — — 116 116
Total nonperforming assets $ 61,324 $ 70,809 $ 34,505 $ 28,775 $ 19,090
Nonperforming loans to total loans 1.13 % 1.29 % 0.63 % 0.53 % 0.36 %
Nonperforming assets to total assets 0.95 % 1.09 % 0.53 % 0.44 % 0.30 %
Performing modifications (B)(C) $ 248 $ 248 $ 248 $ 248 $ —
Performing TDRs (D)(E) $ — $ — $ — $ — $ 965
Loans past due 30 through 89 days and still accruing (F) $ 34,589 $ 9,780 $ 14,524 $ 2,762 $ 7,592
Loans subject to special mention $ 71,397 $ 53,328 $ 53,606 $ 46,566 $ 64,842
Classified loans $ 84,372 $ 94,866 $ 58,655 $ 58,010 $ 42,985
Individually evaluated loans $ 60,710 $ 70,184 $ 33,867 $ 27,736 $ 16,732
Allowance for credit losses ("ACL"):
Beginning of quarter $ 68,592 $ 62,704 $ 62,250 $ 60,829 $ 59,683
Provision for credit losses (G) 5,082 5,944 1,666 1,464 2,103
(Charge-offs)/recoveries, net (H) (7,786 ) (56 ) (1,212 ) (43 ) (957 )
End of quarter $ 65,888 $ 68,592 $ 62,704 $ 62,250 $ 60,829
ACL to nonperforming loans 107.44 % 96.87 % 181.72 % 217.21 % 320.59 %
ACL to total loans 1.21 % 1.25 % 1.15 % 1.16 % 1.15 %
Collectively evaluated ACL to total loans (I) 1.13 % 1.10 % 1.11 % 1.11 % 1.12 %
(A) Includes one freight credit totaling $23.5 million at December 31, 2023 and two freight credits totaling $33.4 million at September 30, 2023. Excludes $1.6 million in held for sale at September 30, 2023.
(B) Amounts reflect modifications that are paying according to modified terms.
(C) Excludes modifications included in nonaccrual loans of $3.0 million at December 31, 2023, $3.1 million at September 30, 2023 and $777,000 at June 30, 2023.
(D) Amounts reflect troubled debt restructurings (“TDRs”) that are paying according to restructured terms.
(E) Excludes TDRs included in nonaccrual loans of $13.4 million at December 31, 2022. On January 1, 2023, the Company adopted Accounting Standards Update 2022-02, which replaced the accounting and recognition of TDRs.
(F) Includes $16.5 million outstanding to U.S. governmental entities at December 31, 2023 and $8.2 million of outstanding multifamily loans to one sponsor. December 31, 2022 includes $4.5 million outstanding to U.S. governmental entities.
(G) Provision to roll forward the ACL excludes a credit of $55,000 at December 31, 2023, a credit of $88,000 at September 30, 2023, a provision of $30,000 at June 30, 2023, a provision of $49,000 at March 31, 2023 and a credit of $173,000 at December 31, 2022 related to off-balance sheet commitments.
(H) Net charge-offs for the quarter ended December 31, 2023 included charge-offs of $2.2 million of a previously established reserve to loans individually evaluated on one multifamily loan and $5.6 million on one equipment finance relationship. Net charge-offs for the quarters ended June 30, 2023 and December 31, 2022 included a charge-off of $1.2 million of a previously established reserve to loans individually evaluated on one commercial real estate loan.
(I) Total ACL less reserves to loans individually evaluated equals collectively evaluated ACL.
*PEAPACK-GLADSTONE FINANCIAL CORPORATION*
*SELECTED BALANCE SHEET DATA*
*(Dollars in Thousands)*
*(Unaudited)*
*As of* * *
* * * * *December 31,* * * * * *September 30,* * * * * *December 31,* * *
* * * * *2023* * * * * *2023* * * * * *2022* * *
*Capital Adequacy* * * * * * *
Equity to total assets (A) 9.01 % 8.57 % 8.39 %
Tangible equity to tangible assets (B) 8.36 % 7.92 % 7.70 %
Book value per share (C) $ 32.90 $ 31.37 $ 29.92
Tangible book value per share (D) $ 30.31 $ 28.77 $ 27.26
Tangible equity to tangible assets excluding other comprehensive loss* 9.28 % 9.06 % 8.77 %
Tangible book value per share excluding other comprehensive loss* $ 33.97 $ 33.36 $ 31.43
*Excludes other comprehensive loss of $64.9 million for the quarter ended December 31, 2023, $81.7 million for the quarter ended September 30, 2023, and $74.2 million for the quarter ended December 31, 2022. See Non-GAAP financial measures reconciliation included in these tables.
(A) Equity to total assets is calculated as total shareholders’ equity as a percentage of total assets at quarter end.
(B) Tangible equity and tangible assets are calculated by excluding the balance of intangible assets from shareholders’ equity and total assets, respectively. Tangible equity as a percentage of tangible assets at quarter end is calculated by dividing tangible equity by tangible assets at quarter end. See Non-GAAP financial measures reconciliation included in these tables.
(C) Book value per common share is calculated by dividing shareholders’ equity by quarter end common shares outstanding.
(D) Tangible book value per share excludes intangible assets. Tangible book value per share is calculated by dividing tangible equity by quarter end common shares outstanding. See Non-GAAP financial measures reconciliation tables.
*As of*
* * * * *December 31,* * * *September 30,* * * *December 31,*
* * * * *2023* * * *2023* * * *2022*
*Regulatory Capital – Holding Company*
Tier I leverage $ 600,444 9.19% $ 592,061 9.05% $ 557,627 8.90%
Tier I capital to risk-weighted assets 600,444 11.43 592,061 11.13 557,627 11.02
Common equity tier I capital ratio to risk-weighted assets 600,432 11.43 592,043 11.13 557,609 11.02
Tier I & II capital to risk-weighted assets 785,413 14.95 784,777 14.76 745,197 14.73
*Regulatory Capital – Bank*
Tier I leverage (E) $ 707,446 10.83% $ 702,517 10.75% $ 680,137 10.85%
Tier I capital to risk-weighted assets (F) 707,446 13.48 702,517 13.22 680,137 13.45
Common equity tier I capital ratio to risk-weighted assets (G) 707,434 13.47 702,499 13.22 680,119 13.45
Tier I & II capital to risk-weighted assets (H) 773,083 14.73 768,979 14.47 741,719 14.67
(E) Regulatory well capitalized standard (including capital conservation buffer) = 4.00% ($261 million)
(F) Regulatory well capitalized standard (including capital conservation buffer) = 8.50% ($446 million)
(G) Regulatory well capitalized standard (including capital conservation buffer) = 7.00% ($368 million)
(H) Regulatory well capitalized standard (including capital conservation buffer) = 10.50% ($551 million)
*PEAPACK-GLADSTONE FINANCIAL CORPORATION*
*LOANS CLOSED*
*(Dollars in Thousands)*
*(Unaudited)*
* * * * *For the Quarters Ended* * *
* * * * *Dec 31,* * * * * *Sept 30,* * * * * *June 30,* * * * * *March 31,* * * * * *Dec 31,* * *
* * * * *2023* * * * * *2023* * * * * *2023* * * * * *2023* * * * * *2022* * *
Residential loans retained $ 5,895 $ 21,310 $ 39,358 $ 30,303 $ 28,051
Residential loans sold 1,449 2,503 1,072 1,477 1,840
Total residential loans 7,344 23,813 40,430 31,780 29,891
Commercial real estate 21,375 3,900 43,235 18,990 6,747
Multifamily 5,725 3,000 26,662 30,150 37,500
Commercial (C&I) loans/leases (A) (B) 145,397 176,845 158,972 207,814 238,568
SBA 7,326 300 13,713 9,950 17,431
Wealth lines of credit (A) 350 6,875 3,950 23,225 7,700
Total commercial loans 180,173 190,920 246,532 290,129 307,946
Installment loans 2,946 6,999 4,587 12,086 1,845
Home equity lines of credit (A) 4,174 6,275 6,107 2,921 3,815
Total loans closed $ 194,637 $ 228,007 $ 297,656 $ 336,916 $ 343,497
* * * * *For the Twelve Months Ended* * *
* * * * *Dec 31,* * * * * *Dec 31,* * *
* * * * *2023* * * * * *2022* * *
Residential loans retained $ 96,866 $ 122,655
Residential loans sold 6,501 32,293
Total residential loans 103,367 154,948
Commercial real estate 87,500 53,602
Multifamily 65,537 381,714
Commercial (C&I) loans (A) (B) 689,028 965,647
SBA 31,289 59,740
Wealth lines of credit (A) 34,400 34,125
Total commercial loans 907,754 1,494,828
Installment loans 26,618 3,329
Home equity lines of credit (A) 19,477 14,667
Total loans closed $ 1,057,216 $ 1,667,772
(A) Includes loans and lines of credit that closed in the period but not necessarily funded.
(B) Includes equipment finance.
*PEAPACK-GLADSTONE FINANCIAL CORPORATION*
*AVERAGE BALANCE SHEET*
(Tax-Equivalent Basis, Dollars in Thousands)
(Unaudited)
*For the Three Months Ended* * *
* * * * *December 31, 2023* * * * * *December 31, 2022* * *
* * * * *Average* * * * * *Income/* * * * * *Annualized* * * * * *Average* * * * * *Income/* * * * * *Annualized* * *
* * * * *Balance* * * * * *Expense* * * * * *Yield* * * * * *Balance* * * * * *Expense* * * * * *Yield* * *
ASSETS:
Interest-earning assets:
Investments:
Taxable (A) $ 798,661 $ 5,202 2.61 % $ 761,164 $ 3,859 2.03 %
Tax-exempt (A) (B) 106 — — 1,999 20 4.00
Loans (B) (C):
Mortgages 581,088 5,300 3.65 516,721 4,017 3.11
Commercial mortgages 2,492,204 28,318 4.55 2,497,847 25,007 4.00
Commercial 2,274,841 37,958 6.67 2,136,355 29,314 5.49
Commercial construction 16,680 382 9.16 4,213 68 6.46
Installment 59,988 1,037 6.91 36,648 496 5.41
Home equity 35,570 721 8.11 36,067 550 6.10
Other 246 8 13.01 292 8 10.96
Total loans 5,460,617 73,724 5.40 5,228,143 59,460 4.55
Federal funds sold — — — — — —
Interest-earning deposits 146,699 1,623 4.43 161,573 1,258 3.11
Total interest-earning assets 6,406,083 80,549 5.03 % 6,152,879 64,597 4.20 %
Noninterest-earning assets:
Cash and due from banks 10,709 6,723
Allowance for credit losses (68,289 ) (60,070 )
Premises and equipment 24,387 23,682
Other assets 85,720 83,641
Total noninterest-earning assets 52,527 53,976
Total assets $ 6,458,610 $ 6,206,855
LIABILITIES:
Interest-bearing deposits:
Checking $ 2,890,964 $ 25,811 3.57 % $ 2,222,130 $ 9,165 1.65 %
Money markets 771,051 5,247 2.72 1,246,179 3,438 1.10
Savings 112,969 81 0.29 161,569 12 0.03
Certificates of deposit – retail 440,712 4,086 3.71 360,589 922 1.02
Subtotal interest-bearing deposits 4,215,696 35,225 3.34 3,990,467 13,537 1.36
Interest-bearing demand – brokered 10,000 142 5.68 81,739 497 2.43
Certificates of deposit – brokered 115,722 1,454 5.03 25,979 210 3.23
Total interest-bearing deposits 4,341,418 36,821 3.39 4,098,185 14,244 1.39
Borrowings 357,384 4,955 5.55 43,710 497 4.55
Capital lease obligation 3,539 42 4.75 4,803 58 4.83
Subordinated debt 133,234 1,685 5.06 132,947 1,363 4.10
Total interest-bearing liabilities 4,835,575 43,503 3.60 % 4,279,645 16,162 1.51 %
Noninterest-bearing liabilities:
Demand deposits 963,968 1,303,432
Accrued expenses and other liabilities 98,012 100,372
Total noninterest-bearing liabilities 1,061,980 1,403,804
Shareholders’ equity 561,055 523,406
Total liabilities and shareholders’ equity $ 6,458,610 $ 6,206,855
Net interest income $ 37,046 $ 48,435
Net interest spread 1.43 % 2.69 %
Net interest margin (D) 2.29 % 3.12 %
(A) Average balances for available for sale securities are based on amortized cost.
(B) Interest income is presented on a tax-equivalent basis using a 21% federal tax rate.
(C) Loans are stated net of unearned income and include nonaccrual loans.
(D) Net interest income on a tax-equivalent basis as a percentage of total average interest-earning assets.
*PEAPACK-GLADSTONE FINANCIAL CORPORATION*
*AVERAGE BALANCE SHEET*
(Tax-Equivalent Basis, Dollars in Thousands)
(Unaudited)
*For the Three Months Ended* * *
* * * * *December 31, 2023* * * * * *September 30, 2023* * *
* * * * *Average* * * * * *Income/* * * * * *Annualized* * * * * *Average* * * * * *Income/* * * * * *Annualized* * *
* * * * *Balance* * * * * *Expense* * * * * *Yield* * * * * *Balance* * * * * *Expense* * * * * *Yield* * *
ASSETS:
Interest-earning assets:
Investments:
Taxable (A) $ 798,661 $ 5,202 2.61 % $ 806,861 $ 5,170 2.56 %
Tax-exempt (A) (B) 106 — — 1,198 11 3.67
Loans (B) (C):