Announces Cost Saving Initiative
Declares Quarterly Cash Dividend of
$0.10 Per Share
MCLEAN,
Va., July 27, 2023 /PRNewswire/ -- Primis
Financial Corp. (NASDAQ: FRST) ("Primis" or the "Company"), and its
wholly-owned subsidiary, Primis Bank (the "Bank"), today reported a
net loss of $0.2 million for the
quarter ended June 30, 2023, compared
to net income of $6.0 million for the
quarter ended March 31, 2023 and
$5.0 million for the quarter ended
June 30, 2022. Earnings per
share ("EPS") for the three months ended June 30, 2023 was a loss of $0.01 on a basic and diluted basis, compared to
earnings of $0.24 on a basic and
diluted basis for the three months March 31,
2023 and $0.20 on a basic and
diluted basis for the three months ended June 30, 2022. Net income for the six
months ended June 30, 2023 was
$5.8 million compared to $9.5 million for the six months ended
June 30, 2022. Earnings per share for
the six months ended June 30, 2023
were $0.23 on a basic and diluted
basis, compared to $0.39 on a basic
and $0.38 on a diluted basis for the
six months ended June 30, 2022.
Notable impacts to the quarter include one-time costs tied to cost
saving initiatives and impairments and other costs related to the
disposal of nonperforming assets, all discussed further below, with
a combined impact of $4 million
pre-tax.
Commenting on the quarterly results, Dennis J. Zember Jr., President and CEO stated,
"We are finishing the second quarter with pro forma capital,
liquidity and credit quality levels that are at the top of our peer
group. While the cost to the quarterly results are
noticeable to achieve this, I believe operating in this current
environment with substantial balance sheet strength is very
important. We have the best funding strategies in our
peer group and even further in our very competitive region and our
23% beta on our core bank's interest bearing deposits evidences
that strength. Additionally, our efforts over the past
several years to focus away from long-maturity CRE into shorter and
higher quality asset classes also brings strength to our balance
sheet and confidence in our future growth."
Mr. Zember continued, "The inverted yield curve is a reality,
but it's not normal and it will not persist forever. In this
environment, our funding and investment decisions have less
incremental profitability, by around 100bps, than normal.
Instead of abandoning our higher quality asset strategies that will
produce the margins we want in normal cycles, we have pivoted hard
towards much lower costs and a gain on sale model for that
production. Our V1BE delivery service for branch functions
will allow us to consolidate branches reduce associated costs and
retain virtually all of the low cost deposits. We went
further and have reduced administrative staff and recalibrated
other strategies and functions that bring the total cost reductions
to approximately 12% of non-mortgage operating expense.
Lastly, we believe our move to the gain on sale model
should offset most of the decrease in net interest income and when
fully in place, allow us to supercharge our lending efforts and
customer acquisition."
Cost Saving Initiative
The Company has put in place a material cost saving project to
reduce administrative and branch expenses given the challenging
operating environment. As part of this initiative, the Bank
will initially consolidate 8 branch locations, reducing total
branches from 32 to 24, with an expected effective date of
October 31, 2023. Branch
consolidations are expected to save approximately $2.9 million annually. In addition to
consolidating branches, the Company is reducing administrative
expenses by eliminating certain positions and not filling others
lost to recent attrition. Administrative reductions are
expected to save approximately $6.5
million annually and is expected to be fully implemented
early in the third quarter of 2023. Combined savings are
expected to be approximately $9.4
million annually. Second quarter 2023 results include
approximately $1.5 million of
severance and related charges for these activities.
Material Improvement in Asset Quality
During the period or subsequent to the second quarter of 2023,
the Company sold or took near term contracts on 80% of its
non-performing assets outstanding last quarter and experienced new
non-accrual loans of only $0.6
million in the second quarter of 2023. Upon the
expected closing of the contracts, pro-forma non-performing assets
to total assets would have been only 0.13% as of June 30, 2023. Charges associated with
impairing the non-performing assets to prepare for the sale totaled
$2.3 million in the quarter.
Additionally, the Company ended the quarter with only 4.7% of
loans in office CRE. The Company ended the quarter with
10.9% of loans secured by cash (mostly in life premium finance),
9.1% of loans to medical professionals and 18.1% in first mortgage
loans with a weighted average LTV of approximately
51.4%. Lastly, concentrations in hospitality
continued to decline in the second quarter of 2023, and are
currently 6.6% of total loans with a current weighted average debt
service coverage of over 1.50x as of the end of the second quarter
of 2023.
Sweep Program Implementation
The Company implemented a traditional sweep program on the last
day of the second quarter of 2023. The sweep program
initially swept $348 million on
June 30, 2023 but management expects
the amount to grow throughout the third quarter of
2023. The effect of the program increases the Company's
leverage ratio to approximately 8.6% (if in place for all of the
second quarter of 2023), a level that the Company's management
believes is in the top quartile of its peer
group. Additionally the program reduces uninvested cash
on the balance sheet and would have increased the net interest
margin by approximately 35 basis points in the second quarter.
With the sweep in place, the Company intends to resume account
opening on the digital platform in a measured way with the goal to
continue increasing accounts throughout the remainder of
2023. Additional funds raised through new accounts will
not affect the Company's capital or profitability ratios except
that incremental spread between the earnings rate and the customer
rate will improve the Company's non-interest income. To
achieve national name recognition and credibility, and the inertia
and flexibility that comes alongside that image, management
believes that the Company would need total accounts of
approximately 50,000 or more and believes the sweep program
provides the ability to scale to that level with minimal risk or
impact to sensitivity or capital levels, while positively impacting
the Company's operating results. Lastly, the sweep
program provides customers with enhanced FDIC insurance of up to
$2 million per account holder.
Discussion of Employee Fraud
Late in the second quarter of 2023, the Company discovered an
employee loan fraud with total exposure of
approximately $2.5
million. The employee, for a period of more than
10 years, would combine expertly crafted but fraudulent
documentation and the willing participation of external parties to
make or renew loans. Management believes, on the advice
of its counsel, its insurance broker and a third party forensic
auditor, that the losses are recoverable under the Company's
insurance policies and is working through the claims
process. Importantly, the lender's regular activities
originating new loans or renewing existing loans ceased
approximately 3 years ago when management changed reporting lines
and instituted stricter controls on extensions of credit.
Since, the lender's activities since have centered on servicing the
loans with proceeds from the past extensions.
Because of the size and timing of the fraudulent loans, a
substantial portion of the loss is reflected in opening equity for
the prior periods in the tables at the end of the press
release. Reported periods in the table have been adjusted for
intra-period losses attributable to the fraud and is
primarily comprised of interest reversals. No potential
recovery of losses from insurance has been recorded at this time
while documentation is underway.
Mr. Zember commented, "While the accounting impact from the
fraud this quarter is to capital instead of earnings,
the situation is unfortunate and frustrating, though isolated and
insurable. Given that the fraud was uncovered
late in the quarter, we are in the process of our forensic
investigation to support the insurance claim to be filed, but
expect future recoveries from the claim."
Financial Highlights for the Period Ended June 30, 2023
- Growth in average deposits of $494
million or 62% annualized versus the previous
quarter. New non-time deposit accounts for the quarter
totaled 4,315 accounts with balances of $112
million at the end of the second quarter of
2023.
- Cumulative beta on the core bank's interest bearing deposits of
only 23%.
- Loan production for the quarter of $165
million and loan growth of $130
million, or 17% annualized, from the previous quarter.
- Pro forma non-performing assets to total assets of 0.13%
adjusting for contracts in place.
- Strong liquidity and capital ratios.
- Limited exposure to investor CRE, particularly office or
retail.
- 71% of loan growth in last 12 months has been either cash
secured life premium or medical professional lending.
- Recently announced cost savings initiative and structural
changes to branch and digital deposit gathering is expected to
reduce costs by an estimated $9.4
million per year and is expected to be fully implemented by
October 2023.
- Reduction in branch count will push total deposits per branch
to approximately $153 million
(including swept deposits) compared to approximately $85 million per branch at the end of 2022.
- Total deposits fully serviced by V1BE increased to $144 million from the prior quarter with 746
customers to the invitation only service.
- Uninsured deposits make up approximately 16% of total deposits
at June 30, 2023.
- Mortgage banking profitable in Q2 with a pre-tax contribution
of $647 thousand.
Net Interest Income
Continued upward pressure on deposit account rates and shifting
from non-interest bearing to higher rate products are impacting
interest expense and net interest income for the Company and the
industry. Net interest income of $26.2
million increased during the quarter compared to the same
period in 2022, but declined when compared to levels recorded in
the first quarter of 2023. Net interest margin for the
Company is further affected by excess cash balances that are 11% of
average earning assets and investments in loans that have
materially better credit quality metrics than the Bank's peer
group. For the second quarter of 2023, the Company reported a
core net interest margin of 3.00% which excludes the effect of the
excess cash balances now in the Bank's sweep program.
Interest income on earning assets increased during the second
quarter of 2023 to $52.7 million
compared to $28.2 million for the
same period in 2022 and $47.1 million
during the first quarter of 2023. The majority of loan
production in the second quarter of 2023 (66%) was either one year
loans on fully cash secured lending in the Company's life insurance
premium division or lending to medical professionals in the
Company's Panacea division. Production yields across Panacea
and Life Premium Finance averaged 7.61%, assuming benefit of an
interest rate swap implemented in the second quarter of 2023,
versus 7.26% in the first quarter of 2023.
While interest income continued to increase in the second
quarter of 2023, incremental costs of interest bearing deposits has
increased at a faster pace. Management has used industry
leading liquidity levels to intensely manage the core bank's
interest expense in-line or below its direct competition while at
the same time exploiting the opportunity to grow accounts on the
national platform with acquisition rates that are initially 100 to
150 basis points higher than the long-term maintenance rates for
these accounts. Management expects that, with the sweep
program in place, this acquisition strategy will have no impact on
the Company's margin or capital ratios while positioning the
Company to have a funding source that is profitable and has the
growth potential of banks five to ten times the size of Primis
Bank.
The core bank's relatively attractive deposit position is seen
below:
|
2Q23
|
1Q23
|
4Q22
|
3Q22
|
2Q22
|
|
|
|
|
|
|
Core Bank Int.
Exp.
|
$ 11,823
|
$
9,343
|
$
5,183
|
$
3,287
|
$
2,311
|
Digital Platform Int.
Exp.
|
$ 12,960
|
$
5,701
|
$
127
|
$
0
|
$
0
|
|
|
|
|
|
|
Core Bank Avg.
Noninterest-bearing
|
$
472,416
|
$
555,771
|
$
648,051
|
$
665,000
|
$
596,693
|
Core Bank Avg.
Interest-bearing deposits (IBD)
|
$2,155,212
|
$2,149,650
|
$2,027,211
|
$2,027,332
|
$2,057,708
|
Digital Platform Avg.
IBD
|
$1,052,603
|
$
481,072
|
$ 14,691
|
$
89
|
$
47
|
|
|
|
|
|
|
Core Bank Cost of
IBD
|
2.20 %
|
1.76 %
|
1.01 %
|
0.64 %
|
0.45 %
|
Core Bank Cost of
Deposits
|
1.80 %
|
1.40 %
|
0.77 %
|
0.48 %
|
0.35 %
|
Digital Platform Cost
of IBD
|
4.94 %
|
4.81 %
|
3.42 %
|
0.55 %
|
0.45 %
|
|
|
|
|
|
|
Avg. 3M FHLB Advance
Rate
|
5.31 %
|
4.96 %
|
4.40 %
|
2.93 %
|
1.31 %
|
During the second quarter of 2023, the core bank opened
$49 million of new non-CD accounts
with initial weighted average costs of 1.4%. This level of
sales activity first illustrates a potential slowdown in rising
rates as well as success with the Company's proprietary banking
delivery service, V1BE, which contributes heavily to new sales of
commercial checking accounts. During the quarter, customers
using the service, which is by invitation only, increased to 746
with total deposits of $144
million. This compares favorably to customers at
December 31, 2022 when the Company
had 495 customers with balances of $89
million on the platform.
National platform sales during the quarter centered on savings
and interest checking and amounted to growth of $87 million. The Company slowed new account
openings during the quarter to train excess resources that were
moved from the core bank platform to the national platform.
We expect these new resources will allow the Company to accelerate
account opening and customer outreach throughout the remaining
months of 2023. At the end of the second quarter of 2023,
there were approximately 13,000 accounts on the platform serviced
by 7 bank professionals and with an average balance and customer
age of $75 thousand and 48 years old,
respectively.
Noninterest Income
Noninterest income decreased during the second quarter to
$8.5 million when compared to
$11.5 million in the first quarter of
2023. The Company began accounting for certain third party
credit enhancements on consumer lending during the third quarter of
2022 and purchased the mortgage platform in the second quarter of
2022. Excluding credit enhancement income, noninterest income
increased $0.7 million to
$7.3 million in the second quarter of
2023, largely due to increased mortgage banking revenue.
During the second quarter of 2023, the Bank realized
$0.2 million of gains associated with
a small sale of Panacea commercial loans. Management
continues efforts to secure additional buyers for the division's
consumer and commercial loans and believes sales of $50 - $100 million
are likely in 2023.
Noninterest Expense
Noninterest expense was $30.6
million for the second quarter of 2023, compared to
$27.4 million for the first quarter
of 2023. Noninterest expense for the second quarter of 2023 and the
first quarter of 2023 included $515
thousand and $873 thousand,
respectively, of servicing and other expenses for a third-party
managed loan portfolio. The second quarter of 2023 also
included $1.5 million of nonrecurring
expenses discussed above versus none in the first quarter of
2023. Noninterest expense adjusted for third-party portfolio
expenses, branch consolidation costs, other restructuring costs and
unfunded commitment reserve impacts was $28.8 million and $26.5
million for the second and first quarter of 2023,
respectively. Included in noninterest expense was $5.3 million in expenses related to Primis
Mortgage in the second quarter of 2023 versus $5.0 million in the first quarter of 2023 with
increased mortgage-related expenses driven by increased
activity.
Excluding mortgage, nonrecurring expenses and the third party
expenses described above, noninterest expense for the second
quarter of 2023 was $23.5 million
versus $21.5 million in the
linked-quarter. Compensation and benefits excluding mortgage
was $9.6 million in the second
quarter of 2023, down from $10.8
million during the first quarter of 2023, primarily due to
attrition and reduction in cash bonus accruals. Offsetting
this reduction, FDIC insurance costs increased $0.7 million in the second quarter of 2023 due to
the substantial increase in deposits this year. FDIC
insurance costs are expected to decline over the next two quarters
as excess deposits are swept to other banks. Data processing
costs were higher by $0.9 million due
to high account opening activity late in the first quarter and
early in the second quarter of 2023 and which has now abated.
The second quarter of 2023 also included approximately $0.4 million of expense to rebuild and replace
debit card stock. Lastly, the second quarter of 2023 included
$0.2 million of expenses for
delinquent taxes for the nonperforming loans in the process of
selling.
Loan Portfolio and Asset Quality
Loans held for investment increased to $3.17 billion at June 30,
2023, compared to $3.04
billion at March 31,
2023. Loans held for investment grew at an annualized rate of
17.1%, net of a decline in PPP balances, in the second quarter of
2023. Loan growth was particularly strong in the Life Premium
Finance division in the second quarter of 2023, as discussed
below.
Nonperforming assets, excluding portions guaranteed by the SBA,
were $24.7 million at June 30, 2023, compared to $32.8 million at March 31,
2023, while loans rated substandard or doubtful decreased to
$33.7 million in the second quarter
of 2023 from $39.5 million in the
first quarter of 2023. As discussed above, a substantial
portion of the Bank's nonperforming assets in previous periods were
comprised of two relationships with a combined balance of
approximately $27 million. A
large residential property with a balance of approximately
$8 million included in that total was
sold in the second quarter of 2023. The other relationship,
primarily consisting of assisted living facilities, is currently at
the end of a receiver-managed marketing process with all three
facilities under contract to close in the third quarter of
2023. At that point, the Bank would have approximately
$5 million of nonperforming
loans. The Bank had no other real estate owned at the end of
the second quarter of 2023.
The Company recorded a provision for loan losses of $4.3 million for the second quarter of 2023
versus $5.2 million for the first
quarter of 2023. Of this provision, $1.4 million was due to charge-offs for the loan
portfolio with a third-party credit enhancement described
previously. This portion of the provision is fully offset by
a gain recorded in noninterest income and has no effect on net
income. Excluding this provision amount, the provision for
loan losses would have been $2.96
million for the second quarter of 2023. $2.3 million of this provision was to increase
specific impairments for the pending nonperforming loan resolutions
detailed above. As a percentage of loans, excluding PPP
balances, the allowance for credit losses was 1.21% and 1.18% at
the end of the second and first quarter of 2023, respectively.
Net charge-offs were $1.6 million
for the second quarter of 2023, down from $4.0 million for the first quarter of 2023.
Excluding the losses that are covered by a third-party, the second
quarter of 2023 would have experienced $0.2
million of net charge-offs versus $2.1 million of net charge-offs in the first
quarter of 2023.
Deposits and Funding
Total deposits on balance sheet decreased to $3.32 billion from $3.67
billion at March 31, 2023 and
were essentially flat at $3.66
billion including excess deposits swept off the balance
sheet at June 30, 2023. Swept
deposits receive full FDIC coverage, bringing the Bank's percentage
of uninsured or unsecured deposits down to 15.8%. Liquidity
sources represent almost 220% of uninsured or unsecured deposits,
up substantially from December 31,
2022.
The Bank paid off $25 million of
brokered CDs in the second quarter and has another $75 million of brokered CDs that mature later in
2023. The Bank has no other wholesale funding and has
$348 million of deposits currently
sweeping to other banks. The cost of the swept deposits is
materially cheaper than wholesale funding and available to fund
further balance sheet growth as needed.
Digital Lines of Business
The Company operates two national lines of business that are
focused primarily on lending to higher quality segments of the
economy and a national digital platform for funding purposes.
Management believes that over time the combined strategy can have
margins in the 3.00%-3.25% range, efficiency ratios in the 30%-40%
range and 50% less net charge-offs than traditional community bank
commercial real estate.
Panacea continues to experience substantial growth alongside the
development of its nationally-recognized brand. Panacea
finished the second quarter of 2023 with approximately $292 million in outstanding loans, an increase of
$35 million, or 14%, from
March 31, 2023. As highlighted
above, Panacea sold approximately $5
million of loans in the second quarter of 2023 for a pre-tax
gain of $0.2 million. Panacea
expects profitability to increase materially in the second half of
2023 due to higher gain on sale income in coming quarters.
Panacea-related deposits increased to $46.3 million at June 30,
2023, up 50% from March 31,
2023 and a substantially higher rate of growth than loan
growth for the second quarter of 2023. Coupled with its loan
sale strategy, Panacea expects to continue increasing the amount it
self-funds its balance sheet.
The Life Premium Finance ("LPF") division, launched in late
2021, ended the second quarter of 2023 with outstanding balances,
net of deferred fees, of $346
million, compared to $237
million at the end of the first quarter of 2023, or an
increase of 46%. The LPF division increased profitability
(including assumed cost of funds) at a higher rate than it grew
earnings assets as it continues to experience meaningful operating
leverage.
Primis Mortgage was profitable for the second quarter of 2023
with pre-tax income of $647
thousand. The locked pipeline ended the second quarter
of 2023 at $61 million, up 15% from
March 31, 2023 while loans funded
increased to $184 million in the
second quarter of 2023, up 50% from the first quarter of 2023.
Shareholders' Equity
Book value per share as of June 30,
2023 was $15.93, a decrease of
$0.21 from March 31, 2023. Tangible book value per
share(1) at the end of the second quarter of 2023 was
$11.58, a decrease of $0.21 from March
31, 2023. Shareholders' equity was $393 million, or 10.21% of total assets, at
June 30, 2023. Tangible common
equity(1) at June 30, 2023
was $286 million, or 7.64% of
tangible assets(1). Unrealized losses on the
Company's available-for-sale securities portfolio increased by
$2.6 million to $26.1 million due to marginal decreases in market
interest rates during the second quarter of 2023. The Company
has the wherewithal to hold these securities until maturity or
recovery of the value and does not anticipate realizing any losses
on the investments.
Additionally, the Board of Directors announced and declared a
dividend of $0.10 per share payable
on August 25, 2023 to shareholders of
record on August 11, 2023. This
is Primis' forty-seventh consecutive quarterly dividend.
About Primis Financial Corp.
As of June 30, 2023, Primis had
$3.8 billion in total assets,
$3.2 billion in total loans and
$3.3 billion in total deposits.
Primis Bank provides a range of financial services to individuals
and small- and medium-sized businesses through thirty-two
full-service branches in Virginia
and Maryland and provides services
to customers through certain online and mobile applications.
Contacts:
|
Address:
|
Dennis J. Zember, Jr.,
President and CEO
|
Primis Financial
Corp.
|
Matthew A. Switzer, EVP
and CFO
|
1676 International
Drive, Suite 900
|
Phone: (703)
893-7400
|
McLean, VA
22102
|
|
|
Primis Financial Corp.,
NASDAQ Symbol FRST
|
|
Website:
www.primisbank.com
|
|
Conference Call
The Company's management will host a conference call to discuss
its second quarter results on Friday, July
28, 2023 at 10:00 a.m. (ET). A
live Webcast of the conference call is available at the following
website: https://events.q4inc.com/attendee/322792474.
Participants may also call 1-888-330-3573 and ask for the Primis
Financial Corp. call. A replay of the teleconference will be
available for 7 days by calling 1-800-770-2030 and providing Replay
Access Code 4440924.
Non-GAAP Measures
Statements included in this press release include non-GAAP
financial measures and should be read along with the accompanying
tables. Primis uses non-GAAP financial measures to analyze its
performance. The measures entitled net income adjusted for
nonrecurring income and expenses; pre-tax pre-provision operating
earnings; operating return on average assets; pre-tax pre-provision
operating return on average assets; operating return on average
equity; operating return on average tangible equity; operating
efficiency ratio; operating earnings per share – basic; operating
earnings per share – diluted; tangible book value per share;
tangible common equity; tangible common equity to tangible assets;
and core net interest margin are not measures recognized under GAAP
and therefore are considered non-GAAP financial measures. We use
the term "operating" to describe a financial measure that excludes
income or expense considered to be non-recurring in nature.
Items identified as non-operating are those that, when excluded
from a reported financial measure, provide management or the reader
with a measure that may be more indicative of forward-looking
trends in our business. A reconciliation of these non-GAAP
financial measures to the most comparable GAAP measures is provided
in the Reconciliation of Non-GAAP Items table.
Management believes that these non-GAAP financial measures
provide additional useful information about Primis that allows
management and investors to evaluate the ongoing operating results,
financial strength and performance of Primis and provide meaningful
comparison to its peers. Non-GAAP financial measures should not be
considered as an alternative to any measure of performance or
financial condition as promulgated under GAAP, and investors should
consider Primis' performance and financial condition as reported
under GAAP and all other relevant information when assessing the
performance or financial condition of Primis. Non-GAAP
financial measures are not standardized and, therefore, it may not
be possible to compare these measures with other companies that
present measures having the same or similar names.
Non-GAAP financial measures have limitations as analytical
tools, and investors should not consider them in isolation or as a
substitute for analysis of the results or financial condition as
reported under GAAP.
Forward-Looking Statements
This press release and certain of our other filings with the
Securities and Exchange Commission contain statements that
constitute "forward-looking statements" within the meaning of, and
subject to the protections of, Section 27A of the Securities Act of
1933, as amended, and Section 21E of the Securities Exchange Act of
1934, as amended. All statements other than statements of
historical fact are forward-looking statements. Such statements can
generally be identified by such words as "may," "plan,"
"contemplate," "anticipate," "believe," "intend," "continue,"
"expect," "project," "predict," "estimate," "could," "should,"
"would," "will," and other similar words or expressions of the
future or otherwise regarding the outlook for the Company's future
business and financial performance and/or the performance of the
banking industry and economy in general. These forward-looking
statements include, but are not limited to, our expectations
regarding our future operating and financial performance, including
our outlook and long-term goals for future growth and new offerings
and services; our expectations regarding net interest margin;
expectations on our growth strategy, expense management, capital
management and future profitability; expectations on credit quality
and performance; and the assumptions underlying our
expectations.
Prospective investors are cautioned that any such
forward-looking statements are not guarantees of future performance
and involve known and unknown risks and uncertainties which may
cause the actual results, performance or achievements of the
Company to be materially different from the future results,
performance or achievements expressed or implied by such
forward-looking statements. Forward-looking statements are based on
the information known to, and current beliefs and expectations of,
the Company's management and are subject to significant risks and
uncertainties. Actual results may differ materially from those
contemplated by such forward-looking statements. Factors that might
cause such differences include, but are not limited to: the
Company's ability to implement its various strategic and growth
initiatives, including its recently established Panacea Financial
and Life Premium Finance Divisions, new digital banking platform,
V1BE fulfillment service and Primis Mortgage Company; competitive
pressures among financial institutions increasing significantly;
changes in applicable laws, rules, or regulations, including
changes to statutes, regulations or regulatory policies or
practices; changes in management's plans for the future; credit
risk associated with our lending activities; changes in interest
rates, inflation, loan demand, real estate values, or competition,
as well as labor shortages and supply chain disruptions; changes in
accounting principles, policies, or guidelines; adverse results
from current or future litigation, regulatory examinations or other
legal and/or regulatory actions; potential impacts of the recent
adverse developments in the banking industry highlighted by
high-profile bank failures, including impacts on customer
confidence, deposit outflows, liquidity and the regulatory response
thereto; potential increases in the provision for credit losses;
and other general competitive, economic, political, and market
factors, including those affecting our business, operations,
pricing, products, or services.
Forward-looking statements speak only as of the date on which
such statements are made. These forward-looking statements are
based upon information presently known to the Company's management
and are inherently subjective, uncertain and subject to change due
to any number of risks and uncertainties, including, without
limitation, the risks and other factors set forth in the Company's
filings with the Securities and Exchange Commission, the Company's
Annual Report on Form 10-K for the year ended December 31, 2022, under the captions "Cautionary
Note Regarding Forward-Looking Statements" and "Risk Factors," and
in the Company's Quarterly Reports on Form 10-Q and Current Reports
on Form 8-K. The Company undertakes no obligation to update any
forward-looking statement to reflect events or circumstances after
the date on which such statement is made, or to reflect the
occurrence of unanticipated events. Readers are cautioned not to
place undue reliance on these forward-looking statements.
Primis Financial
Corp.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Highlights
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in thousands, except per share
data)
|
For Three Months Ended:
|
|
Variance - 2Q 2023 vs.
|
|
|
For Six Months Ended:
|
|
Variance
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected Performance Ratios:
|
2Q 2023
|
1Q 2023
|
4Q 2022
|
3Q 2022
|
2Q 2022
|
|
1Q 2023
|
|
2Q 2022
|
|
|
2Q 2023
|
2Q 2022
|
|
YTD
|
|
Return on average
assets
|
(0.02 %)
|
0.62 %
|
0.35 %
|
0.61 %
|
0.62 %
|
|
(64)
|
bps
|
(64)
|
bps
|
|
0.29 %
|
0.58 %
|
|
(30)
|
bps
|
Operating return on
average assets(1)
|
0.09 %
|
0.62 %
|
0.08 %
|
0.64 %
|
0.75 %
|
|
(53)
|
|
(66)
|
|
|
0.34 %
|
0.65 %
|
|
(31)
|
|
Pre-tax pre-provision
return on average assets(1)
|
0.37 %
|
1.31 %
|
1.32 %
|
1.16 %
|
0.83 %
|
|
(94)
|
|
(46)
|
|
|
0.55 %
|
0.78 %
|
|
(23)
|
|
Pre-tax pre-provision
operating return on average assets(1)
|
0.51 %
|
1.31 %
|
0.98 %
|
1.20 %
|
0.99 %
|
|
(80)
|
|
(48)
|
|
|
0.63 %
|
0.87 %
|
|
(24)
|
|
Return on average
equity
|
(0.19 %)
|
5.98 %
|
3.04 %
|
4.98 %
|
4.89 %
|
|
(616)
|
|
(508)
|
|
|
2.88 %
|
4.67 %
|
|
(179)
|
|
Operating return on
average equity(1)
|
0.98 %
|
5.98 %
|
0.71 %
|
5.22 %
|
5.90 %
|
|
(500)
|
|
(492)
|
|
|
3.46 %
|
5.22 %
|
|
(175)
|
|
Operating return on
average tangible equity(1)
|
1.33 %
|
8.14 %
|
0.98 %
|
7.15 %
|
8.05 %
|
|
(681)
|
|
(671)
|
|
|
4.72 %
|
7.06 %
|
|
(233)
|
|
Cost of
funds
|
|
2.81 %
|
2.19 %
|
1.19 %
|
0.71 %
|
0.53 %
|
|
62
|
|
228
|
|
|
2.52 %
|
0.52 %
|
|
200
|
|
Net interest
margin
|
2.65 %
|
3.15 %
|
3.67 %
|
3.57 %
|
3.33 %
|
|
(50)
|
|
(68)
|
|
|
2.89 %
|
3.14 %
|
|
(25)
|
|
Core net interest
margin(1)
|
2.65 %
|
3.16 %
|
3.68 %
|
3.58 %
|
3.35 %
|
|
(51)
|
|
(70)
|
|
|
2.89 %
|
3.15 %
|
|
(26)
|
|
Gross loans to
deposits
|
95.68 %
|
82.92 %
|
108.24 %
|
100.98 %
|
97.90 %
|
|
13
|
pts
|
(2)
|
pts
|
|
95.68 %
|
97.90 %
|
|
(2)
|
pts
|
Efficiency
ratio
|
|
88.19 %
|
68.69 %
|
71.82 %
|
71.93 %
|
75.26 %
|
|
20
|
|
1,293
|
|
|
77.75 %
|
75.79 %
|
|
196
|
|
Operating efficiency
ratio(1)
|
83.90 %
|
68.69 %
|
76.78 %
|
70.99 %
|
70.48 %
|
|
15
|
|
1,342
|
|
|
75.76 %
|
73.08 %
|
|
268
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Per Share Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share -
Basic
|
$
(0.01)
|
$
0.24
|
$
0.12
|
$
0.20
|
$
0.20
|
|
(103.16)
|
%
|
(103.79)
|
%
|
|
$
0.23
|
$
0.39
|
|
(39.40)
|
%
|
Operating earnings per
share - Basic(1)
|
$
0.04
|
$
0.24
|
$
0.03
|
$
0.21
|
$
0.24
|
|
(84)
|
|
(83.66)
|
|
|
$
0.28
|
$
0.43
|
|
(34.84)
|
|
Earnings per share -
Diluted
|
$
(0.01)
|
$
0.24
|
$
0.12
|
$
0.20
|
$
0.20
|
|
(103.16)
|
|
(103.81)
|
|
|
$
0.23
|
$
0.38
|
|
(39.23)
|
|
Operating earnings per
share - Diluted(1)
|
$
0.04
|
$
0.24
|
$
0.03
|
$
0.21
|
$
0.24
|
|
(84)
|
|
(83.61)
|
|
|
$
0.28
|
$
0.43
|
|
(34.62)
|
|
Book value per
share
|
$
15.93
|
$
16.14
|
$
15.90
|
$
15.82
|
$
16.10
|
|
(1.35)
|
|
(1.05)
|
|
|
$
15.93
|
$
16.10
|
|
(1.05)
|
|
Tangible book value per
share(1)
|
$
11.58
|
$
11.79
|
$
11.53
|
$
11.43
|
$
11.69
|
|
(1.73)
|
|
(0.93)
|
|
|
$
11.58
|
$
11.69
|
|
(0.93)
|
|
Cash dividend per
share
|
$
0.10
|
$
0.10
|
$
0.10
|
$
0.10
|
$
0.10
|
|
-
|
|
-
|
|
|
$
0.20
|
$
0.20
|
|
-
|
|
Weighted average shares
outstanding - Basic
|
24,638,505
|
24,625,943
|
24,601,108
|
24,576,887
|
24,562,753
|
|
0.05
|
|
0.31
|
|
|
24,632,259
|
24,533,512
|
|
0.40
|
|
Weighted average shares
outstanding - Diluted
|
24,688,141
|
24,685,206
|
24,685,663
|
24,688,422
|
24,681,425
|
|
0.01
|
|
0.03
|
|
|
24,685,072
|
24,666,486
|
|
0.08
|
|
Shares outstanding at
end of period
|
24,690,064
|
24,685,064
|
24,680,097
|
24,650,239
|
24,650,239
|
|
0.02
|
%
|
0.16
|
%
|
|
24,690,064
|
24,650,239
|
|
0.16
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset Quality Ratios:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-performing assets
as a percent of total assets, excluding SBA guarantees
|
0.64 %
|
0.78 %
|
0.98 %
|
1.11 %
|
0.61 %
|
|
(14)
|
bps
|
3
|
bps
|
|
0.64 %
|
0.61 %
|
|
3
|
bps
|
Net charge-offs
(recoveries) as a percent of average loans (annualized)
|
0.20 %
|
0.53 %
|
0.74 %
|
0.17 %
|
(0.06 %)
|
|
(33)
|
|
27
|
|
|
0.18 %
|
(0.04 %)
|
|
22
|
|
Core net charge-offs
(recoveries) as a percent of average loans
(annualized)(2)
|
0.02 %
|
0.28 %
|
0.53 %
|
0.17 %
|
(0.06 %)
|
|
(26)
|
|
9
|
|
|
0.07 %
|
(0.04 %)
|
|
11
|
|
Allowance for credit
losses to total loans
|
1.21 %
|
1.17 %
|
1.17 %
|
1.17 %
|
1.15 %
|
|
4
|
|
6
|
|
|
1.21 %
|
1.15 %
|
|
6
|
|
Allowance for credit
losses to total loans (excluding PPP loans)
|
1.21 %
|
1.18 %
|
1.17 %
|
1.17 %
|
1.16 %
|
|
4
|
|
5
|
|
|
1.21 %
|
1.16 %
|
|
5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital Ratios:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity to
assets
|
|
10.22 %
|
9.48 %
|
10.99 %
|
11.62 %
|
12.27 %
|
|
74
|
bps
|
(205)
|
bps
|
|
|
|
|
|
|
Tangible common equity
to tangible assets(1)
|
7.64 %
|
7.10 %
|
8.22 %
|
8.68 %
|
9.22 %
|
|
54
|
|
(158)
|
|
|
|
|
|
|
|
Leverage
ratio(3)
|
|
7.84 %
|
8.59 %
|
9.48 %
|
10.11 %
|
10.31 %
|
|
(75)
|
|
(247)
|
|
|
|
|
|
|
|
Common equity tier 1
capital ratio(3)
|
10.03 %
|
10.04 %
|
10.54 %
|
11.17 %
|
11.59 %
|
|
(1)
|
|
(156)
|
|
|
|
|
|
|
|
Tier 1 risk-based
capital ratio(3)
|
10.36 %
|
10.36 %
|
10.88 %
|
11.53 %
|
11.97 %
|
|
0
|
|
(161)
|
|
|
|
|
|
|
|
Total risk-based
capital ratio(3)
|
14.04 %
|
14.20 %
|
14.80 %
|
15.71 %
|
16.29 %
|
|
(16)
|
|
(225)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) See
Reconciliation of Non-GAAP financial
measures.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2) Excludes third-party
charge-offs.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(3) June 30, 2023 ratios are estimated and may be subject
to change pending the final filing of the FR
Y-9C.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Primis Financial
Corp.
|
|
|
|
|
|
|
|
|
|
|
(Dollars in thousands)
|
As Of :
|
|
Variance - 2Q 2023 vs.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Condensed Consolidated Balance Sheets
(unaudited)
|
2Q 2023
|
1Q 2023
|
4Q 2022
|
3Q 2022
|
2Q 2022
|
|
1Q 2023
|
|
2Q 2022
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$ 100,868
|
$ 607,125
|
$ 77,859
|
$ 97,738
|
$ 70,721
|
|
(83.39)
|
%
|
42.63
|
%
|
Investment
securities-available for sale
|
223,087
|
231,468
|
236,315
|
238,891
|
257,180
|
|
(3.62)
|
|
(13.26)
|
|
Investment
securities-held to maturity
|
12,378
|
13,115
|
13,520
|
14,391
|
14,978
|
|
(5.62)
|
|
(17.36)
|
|
Loans held for
sale
|
57,704
|
42,011
|
27,626
|
13,388
|
16,096
|
|
37.35
|
|
258.50
|
|
Loans receivable, net
of deferred fees
|
3,173,638
|
3,041,533
|
2,946,637
|
2,734,887
|
2,626,598
|
|
4.34
|
|
20.83
|
|
Allowance for credit
losses
|
(38,414)
|
(35,727)
|
(34,544)
|
(31,956)
|
(30,209)
|
|
7.52
|
|
27.16
|
|
|
Net loans
|
|
3,135,224
|
3,005,806
|
2,912,093
|
2,702,931
|
2,596,389
|
|
4.31
|
|
20.75
|
|
Stock in Federal
Reserve Bank and Federal Home Loan Bank
|
12,083
|
12,083
|
25,815
|
16,689
|
12,940
|
|
-
|
|
(6.62)
|
|
Bank premises and
equipment, net
|
25,298
|
25,136
|
25,257
|
25,534
|
26,113
|
|
0.64
|
|
(3.12)
|
|
Operating lease
right-of-use assets
|
10,707
|
9,352
|
5,335
|
5,511
|
4,777
|
|
14.49
|
|
124.14
|
|
Goodwill and other
intangible assets
|
107,215
|
107,539
|
107,863
|
108,170
|
108,524
|
|
(0.30)
|
|
(1.21)
|
|
Assets held for sale,
net
|
3,115
|
3,115
|
3,115
|
3,127
|
3,127
|
|
-
|
|
(0.38)
|
|
Bank-owned life
insurance
|
67,985
|
67,591
|
67,201
|
67,519
|
67,339
|
|
0.58
|
|
0.96
|
|
Other real estate
owned
|
-
|
-
|
-
|
1,041
|
1,041
|
|
-
|
|
(100.00)
|
|
Deferred tax assets,
net
|
20,391
|
18,825
|
18,289
|
17,892
|
14,658
|
|
8.32
|
|
39.11
|
|
Other assets
|
|
72,438
|
60,260
|
49,310
|
42,428
|
40,811
|
|
20.21
|
|
77.50
|
|
|
Total assets
|
$
3,848,493
|
$
4,203,426
|
$
3,569,598
|
$
3,355,250
|
$
3,234,694
|
|
(8.44)
|
%
|
18.98
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and stockholders'
equity
|
|
|
|
|
|
|
|
|
|
|
Demand
deposits
|
$ 480,832
|
$ 497,531
|
$ 582,556
|
$ 687,272
|
$ 653,181
|
|
(3.36)
|
%
|
(26.39)
|
%
|
NOW accounts
|
|
817,725
|
835,348
|
617,687
|
637,786
|
677,237
|
|
(2.11)
|
|
20.74
|
|
Money market
accounts
|
850,359
|
865,115
|
811,365
|
803,050
|
802,953
|
|
(1.71)
|
|
5.90
|
|
Savings
accounts
|
696,750
|
971,439
|
245,713
|
217,220
|
220,211
|
|
(28.28)
|
|
216.40
|
|
Time
deposits
|
|
471,330
|
498,564
|
465,057
|
362,992
|
329,223
|
|
(5.46)
|
|
43.16
|
|
Total deposits
|
|
3,316,996
|
3,667,997
|
2,722,378
|
2,708,320
|
2,682,805
|
|
(9.57)
|
|
23.64
|
|
Securities sold under
agreements to repurchase - short term
|
3,921
|
4,346
|
6,445
|
9,886
|
10,020
|
|
(9.78)
|
|
(60.87)
|
|
Federal Home Loan Bank
advances
|
-
|
-
|
325,000
|
125,000
|
25,000
|
|
-
|
|
(100.00)
|
|
Subordinated debt and
notes
|
95,453
|
95,382
|
95,312
|
95,241
|
95,170
|
|
0.07
|
|
0.30
|
|
Operating lease
liabilities
|
11,546
|
9,799
|
5,767
|
6,044
|
5,299
|
|
17.83
|
|
117.89
|
|
Other
liabilities
|
|
27,361
|
27,397
|
22,232
|
20,863
|
19,647
|
|
(0.13)
|
|
39.26
|
|
|
Total
liabilities
|
3,455,277
|
3,804,921
|
3,177,134
|
2,965,354
|
2,837,941
|
|
(9.19)
|
|
21.75
|
|
Stockholders'
equity
|
393,216
|
398,505
|
392,464
|
389,896
|
396,753
|
|
(1.33)
|
|
(0.89)
|
|
|
Total liabilities and
stockholders' equity
|
$
3,848,493
|
$
4,203,426
|
$
3,569,598
|
$
3,355,250
|
$
3,234,694
|
|
(8.44)
|
%
|
18.98
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tangible common
equity(1)
|
$ 286,001
|
$ 290,966
|
$ 284,601
|
$ 281,726
|
$ 288,229
|
|
(1.71)
|
%
|
(0.77)
|
%
|
Primis Financial
Corp.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in thousands)
|
For Three Months Ended:
|
|
Variance - 2Q 2023 vs.
|
|
|
For Six Months Ended:
|
|
Variance
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Condensed Consolidated Statement of Operations
(unaudited)
|
2Q 2023
|
1Q 2023
|
4Q 2022
|
3Q 2022
|
2Q 2022
|
|
1Q 2023
|
|
2Q 2022
|
|
|
2Q 2023
|
2Q 2022
|
|
YTD
|
|
Interest and dividend
income
|
$ 52,679
|
$ 47,114
|
$ 38,595
|
$ 32,561
|
$ 28,230
|
|
11.81
|
%
|
86.61
|
%
|
|
$ 99,793
|
$ 54,789
|
|
82.14
|
%
|
Interest
expense
|
|
26,522
|
18,749
|
9,058
|
5,146
|
3,652
|
|
41.46
|
|
NM
|
|
|
45,271
|
7,383
|
|
NM
|
|
|
Net interest
income
|
26,157
|
28,365
|
29,537
|
27,415
|
24,578
|
|
(7.79)
|
|
6.42
|
|
|
54,522
|
47,406
|
|
15.01
|
|
Provision for (recovery
of) credit losses
|
4,301
|
5,187
|
7,860
|
2,890
|
422
|
|
(17.08)
|
|
NM
|
|
|
9,488
|
521
|
|
NM
|
|
|
Net interest income
after provision for (recovery of) credit losses
|
21,856
|
23,178
|
21,677
|
24,525
|
24,156
|
|
(5.71)
|
|
(9.52)
|
|
|
45,034
|
46,885
|
|
(3.95)
|
|
Account maintenance and
deposit service fees
|
1,430
|
1,216
|
1,427
|
1,525
|
1,442
|
|
17.60
|
|
(0.83)
|
|
|
2,646
|
2,793
|
|
(5.26)
|
|
Income from bank-owned
life insurance
|
394
|
420
|
847
|
394
|
378
|
|
(6.19)
|
|
4.23
|
|
|
814
|
753
|
|
8.10
|
|
Mortgage banking
income
|
5,198
|
4,315
|
2,264
|
2,197
|
593
|
|
20.46
|
|
NM
|
|
|
9,513
|
593
|
|
NM
|
|
Gain on sale of
loans
|
182
|
478
|
-
|
-
|
-
|
|
(61.85)
|
|
-
|
|
|
660
|
-
|
|
-
|
|
Credit enhancement
income
|
1,152
|
4,886
|
1,822
|
1,220
|
-
|
|
(76.42)
|
|
-
|
|
|
6,038
|
-
|
|
-
|
|
Gain on sale of other
investment
|
-
|
-
|
4,411
|
-
|
-
|
|
-
|
|
-
|
|
|
-
|
-
|
|
-
|
|
Other
|
|
130
|
217
|
217
|
284
|
217
|
|
(40.09)
|
|
(40.09)
|
|
|
347
|
581
|
|
(40.28)
|
|
|
Noninterest
income
|
8,486
|
11,532
|
10,988
|
5,620
|
2,630
|
|
(26.41)
|
|
222.67
|
|
|
20,018
|
4,720
|
|
NM
|
|
Employee compensation
and benefits
|
15,283
|
15,028
|
16,213
|
12,594
|
10,573
|
|
1.70
|
|
44.55
|
|
|
30,311
|
20,198
|
|
50.07
|
|
Occupancy and equipment
expenses
|
3,445
|
3,022
|
2,899
|
2,857
|
2,546
|
|
14.00
|
|
35.31
|
|
|
6,467
|
5,103
|
|
26.73
|
|
Amortization of
intangible assets
|
318
|
317
|
317
|
326
|
341
|
|
0.32
|
|
(6.74)
|
|
|
635
|
682
|
|
(6.89)
|
|
Virginia franchise tax
expense
|
848
|
849
|
814
|
813
|
814
|
|
(0.12)
|
|
4.18
|
|
|
1,697
|
1,627
|
|
4.30
|
|
Data processing
expense
|
2,828
|
2,251
|
1,702
|
1,528
|
1,293
|
|
25.63
|
|
118.72
|
|
|
5,079
|
2,783
|
|
82.50
|
|
Marketing
expense
|
521
|
569
|
933
|
938
|
731
|
|
(8.44)
|
|
(28.73)
|
|
|
1,090
|
1,196
|
|
(8.86)
|
|
Telecommunication and
communication expense
|
416
|
377
|
343
|
342
|
366
|
|
10.34
|
|
13.66
|
|
|
793
|
748
|
|
6.02
|
|
Net (gain) loss on
other real estate owned
|
-
|
-
|
131
|
-
|
-
|
|
-
|
|
-
|
|
|
-
|
(59)
|
|
(100.00)
|
|
Loss on bank premises
and equipment
|
-
|
-
|
-
|
64
|
620
|
|
-
|
|
(100.00)
|
|
|
-
|
620
|
|
(100.00)
|
|
Professional
fees
|
|
1,075
|
862
|
1,605
|
1,261
|
827
|
|
24.71
|
|
29.99
|
|
|
1,937
|
1,921
|
|
0.83
|
|
Credit enhancement
costs
|
515
|
873
|
1,369
|
-
|
-
|
|
(41.01)
|
|
-
|
|
|
1,388
|
-
|
|
-
|
|
Other
expenses
|
|
5,303
|
3,256
|
2,780
|
3,038
|
2,366
|
|
62.90
|
|
124.17
|
|
|
8,559
|
4,690
|
|
82.50
|
|
|
Noninterest
expense
|
30,552
|
27,404
|
29,106
|
23,761
|
20,477
|
|
11.49
|
|
49.20
|
|
|
57,956
|
39,509
|
|
46.69
|
|
Income before income
taxes
|
(210)
|
7,306
|
3,559
|
6,384
|
6,309
|
|
(102.88)
|
|
(103.33)
|
|
|
7,096
|
12,097
|
|
(41.34)
|
|
Income tax
expense
|
(22)
|
1,353
|
519
|
1,359
|
1,361
|
|
(101.61)
|
|
(101.60)
|
|
|
1,331
|
2,612
|
|
(49.03)
|
|
|
Net Income
|
$
(188)
|
$
5,953
|
$
3,040
|
$
5,025
|
$
4,948
|
|
(103.16)
|
|
(103.81)
|
|
|
5,765
|
9,484
|
|
(39.21)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) See
Reconciliation of Non-GAAP financial
measures.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The company defines "NM" as not meaningful for
increases or decreases greater than 300
percent.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Primis Financial
Corp.
|
|
|
|
|
|
|
|
|
|
|
(Dollars in thousands)
|
As Of:
|
|
Variance - 2Q 2023 vs.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loan Portfolio Composition
|
2Q 2023
|
1Q 2023
|
4Q 2022
|
3Q 2022
|
2Q 2022
|
|
1Q 2023
|
|
2Q 2022
|
|
Loans held for
sale
|
$ 57,704
|
$ 42,011
|
$ 27,626
|
$ 13,388
|
$ 16,096
|
|
37.35
|
%
|
258.50
|
%
|
Loans secured by real
estate:
|
|
|
|
|
|
|
|
|
|
|
|
Commercial real estate
- owner occupied
|
448,624
|
460,245
|
461,126
|
437,636
|
433,840
|
|
(2.52)
|
|
3.41
|
|
|
Commercial real estate
- non-owner occupied
|
597,254
|
577,481
|
581,168
|
573,732
|
600,436
|
|
3.42
|
|
(0.53)
|
|
|
Secured by
farmland
|
6,577
|
6,258
|
7,290
|
7,706
|
8,159
|
|
5.10
|
|
(19.39)
|
|
|
Construction and land
development
|
175,141
|
151,950
|
148,762
|
138,371
|
117,604
|
|
15.26
|
|
48.92
|
|
|
Residential 1-4
family
|
592,756
|
607,118
|
610,919
|
616,764
|
607,548
|
|
(2.37)
|
|
(2.43)
|
|
|
Multi-family
residential
|
133,754
|
139,978
|
140,321
|
137,253
|
144,406
|
|
(4.45)
|
|
(7.38)
|
|
|
Home equity lines of
credit
|
62,808
|
64,606
|
65,152
|
65,852
|
69,860
|
|
(2.78)
|
|
(10.09)
|
|
|
Total real estate loans
|
2,016,914
|
2,007,636
|
2,014,738
|
1,977,314
|
1,981,853
|
|
0.46
|
|
1.77
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial
loans
|
585,442
|
546,042
|
522,057
|
469,881
|
447,529
|
|
7.22
|
|
30.82
|
|
Paycheck Protection
Program loans
|
2,143
|
2,603
|
4,564
|
8,014
|
17,525
|
|
(17.67)
|
|
(87.77)
|
|
Consumer
loans
|
|
569,139
|
485,252
|
405,278
|
279,678
|
179,691
|
|
17.29
|
|
216.73
|
|
|
Loans receivable, net
of deferred fees
|
$
3,173,638
|
$
3,041,533
|
$
2,946,637
|
$
2,734,887
|
$
2,626,598
|
|
4.34
|
%
|
20.83
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans by Risk Grade:
|
|
|
|
|
|
|
|
|
|
|
Pass, not
graded
|
$
-
|
$
-
|
$
-
|
$
-
|
$
-
|
|
-
|
%
|
-
|
%
|
Pass Grade
1 - Highest Quality
|
743
|
607
|
600
|
616
|
609
|
|
22.41
|
|
22.00
|
|
Pass Grade
2 - Good Quality
|
367,950
|
253,665
|
209,605
|
149,389
|
129,571
|
|
45.05
|
|
183.98
|
|
Pass Grade
3 - Satisfactory Quality
|
1,624,626
|
1,596,091
|
1,590,765
|
1,519,765
|
1,512,455
|
|
1.79
|
|
7.42
|
|
Pass Grade
4 - Pass
|
1,114,218
|
1,123,393
|
1,072,352
|
982,412
|
889,109
|
|
(0.82)
|
|
25.32
|
|
Pass Grade
5 - Special Mention
|
32,383
|
28,273
|
32,278
|
35,410
|
67,736
|
|
14.54
|
|
(52.19)
|
|
Grade 6 -
Substandard
|
33,718
|
39,504
|
41,037
|
47,295
|
27,118
|
|
(14.65)
|
|
24.34
|
|
Grade 7 -
Doubtful
|
-
|
-
|
-
|
-
|
-
|
|
-
|
|
-
|
|
Grade 8 -
Loss
|
|
-
|
-
|
-
|
-
|
-
|
|
-
|
|
-
|
|
Total loans
|
|
$
3,173,638
|
$
3,041,533
|
$
2,946,637
|
$
2,734,887
|
$
2,626,598
|
|
4.34
|
%
|
20.83
|
%
|
(Dollars in thousands)
|
As Of or For Three Months
Ended:
|
|
|
|
|
|
|
|
|
Asset Quality Information
|
2Q 2023
|
1Q 2023
|
4Q 2022
|
3Q 2022
|
2Q 2022
|
Allowance for Credit Losses:
|
|
|
Balance at beginning of
period
|
$ (35,727)
|
$ (34,544)
|
$ (31,956)
|
$ (30,209)
|
$ (29,379)
|
(Provision for) /
recovery of allowance for credit losses
|
(4,301)
|
(5,187)
|
(7,860)
|
(2,890)
|
(422)
|
Net
charge-offs
|
|
1,614
|
4,004
|
5,272
|
1,143
|
(408)
|
Ending
balance
|
|
$ (38,414)
|
$ (35,727)
|
$ (34,544)
|
$ (31,956)
|
$ (30,209)
|
|
|
|
|
|
|
|
|
Reserve for Unfunded
Commitments:
|
|
|
Balance at beginning of
period
|
$
(1,507)
|
$
(1,416)
|
$
(1,380)
|
$
(1,069)
|
$
(1,237)
|
(Expense for) /
recovery of unfunded loan commitment reserve
|
234
|
(91)
|
(36)
|
(311)
|
168
|
Total Reserve for
Unfunded Commitments
|
$
(1,273)
|
$
(1,507)
|
$
(1,416)
|
$
(1,380)
|
$
(1,069)
|
|
|
|
As Of:
|
|
Variance - 2Q 2023 vs.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Performing Assets:
|
2Q 2023
|
1Q 2023
|
4Q 2022
|
3Q 2022
|
2Q 2022
|
|
1Q 2023
|
|
2Q 2022
|
|
Nonaccrual
loans
|
$ 25,290
|
$ 33,397
|
$ 35,484
|
$ 36,851
|
$ 19,635
|
|
(24.28)
|
%
|
28.80
|
%
|
Accruing loans
delinquent 90 days or more
|
1,714
|
1,625
|
3,361
|
1,855
|
1,512
|
|
5.48
|
|
13.36
|
|
Total non-performing
loans
|
27,004
|
35,022
|
38,845
|
38,706
|
21,147
|
|
(22.90)
|
|
27.69
|
|
Other real estate
owned
|
-
|
-
|
-
|
1,041
|
1,041
|
|
-
|
|
(100.00)
|
|
Total non-performing
assets
|
$ 27,004
|
$ 35,022
|
$ 38,845
|
$ 39,747
|
$ 22,188
|
|
(22.90)
|
|
21.70
|
|
SBA guaranteed portion
of non-performing loans
|
$
2,331
|
$
2,206
|
$
3,969
|
$
2,573
|
$
2,319
|
|
5.67
|
|
0.52
|
|
Primis Financial
Corp.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in thousands)
|
For Three Months Ended:
|
|
Variance - 2Q 2021 vs.
|
|
|
For Six Months Ended:
|
|
Variance
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average Balance Sheet
|
2Q 2023
|
1Q 2023
|
4Q 2022
|
3Q 2022
|
2Q 2022
|
|
1Q 2023
|
|
2Q 2022
|
|
|
2Q 2023
|
2Q 2022
|
|
YTD
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans held for
sale
|
$ 48,698
|
$ 25,346
|
$ 22,413
|
$ 21,199
|
$
6,936
|
|
92.13
|
%
|
NM
|
%
|
|
$ 37,086
|
$
3,487
|
|
NM
|
%
|
Loans, net of deferred
fees
|
3,101,946
|
2,989,766
|
2,822,693
|
2,667,406
|
2,507,779
|
|
3.75
|
|
23.69
|
|
|
3,047,259
|
2,433,593
|
|
25.22
|
|
Investment
securities
|
240,700
|
246,402
|
253,345
|
269,780
|
287,722
|
|
(2.31)
|
|
(16.34)
|
|
|
243,536
|
295,036
|
|
(17.46)
|
|
Other earning
assets
|
568,251
|
388,327
|
92,604
|
90,268
|
158,817
|
|
46.33
|
|
257.80
|
|
|
478,786
|
312,033
|
|
53.44
|
|
Total earning assets
|
3,959,595
|
3,649,841
|
3,191,055
|
3,048,653
|
2,961,254
|
|
8.49
|
|
33.71
|
|
|
3,806,667
|
3,044,149
|
|
25.05
|
|
Other assets
|
|
259,048
|
254,223
|
246,853
|
234,642
|
229,208
|
|
1.90
|
|
13.02
|
|
|
256,558
|
227,929
|
|
12.56
|
|
Total assets
|
|
$
4,218,643
|
$
3,904,064
|
$
3,437,908
|
$
3,283,295
|
$
3,190,462
|
|
8.06
|
%
|
32.23
|
%
|
|
$
4,063,225
|
$
3,272,078
|
|
24.18
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and stockholders'
equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand
deposits
|
$ 473,295
|
$ 556,479
|
$ 648,151
|
$ 665,020
|
$ 596,714
|
|
(14.95)
|
%
|
(20.68)
|
%
|
|
$
514,657
|
$
571,264
|
|
(9.91)
|
%
|
Interest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NOW and other demand
accounts
|
826,598
|
722,584
|
624,868
|
660,387
|
695,481
|
|
14.39
|
|
18.85
|
|
|
774,878
|
756,118
|
|
2.48
|
|
Money market
accounts
|
858,532
|
824,541
|
805,303
|
803,860
|
810,781
|
|
4.12
|
|
5.89
|
|
|
841,630
|
810,124
|
|
3.89
|
|
Savings
accounts
|
1,026,085
|
593,823
|
232,543
|
219,167
|
222,274
|
|
72.79
|
|
NM
|
|
|
811,148
|
223,489
|
|
262.95
|
|
Time
deposits
|
|
495,721
|
489,066
|
379,088
|
343,986
|
329,198
|
|
1.36
|
|
50.58
|
|
|
492,412
|
339,724
|
|
44.94
|
|
Total Deposits
|
3,680,231
|
3,186,493
|
2,689,953
|
2,692,420
|
2,654,448
|
|
15.49
|
|
38.64
|
|
|
3,434,725
|
2,700,719
|
|
27.18
|
|
Borrowings
|
|
99,794
|
284,946
|
325,100
|
166,621
|
107,784
|
|
(64.98)
|
|
(7.41)
|
|
|
191,859
|
139,363
|
|
37.67
|
|
Total Funding
|
|
3,780,025
|
3,471,439
|
3,015,053
|
2,859,041
|
2,762,232
|
|
8.89
|
|
36.85
|
|
|
3,626,584
|
2,840,082
|
|
27.69
|
|
Other
Liabilities
|
|
37,265
|
28,592
|
26,318
|
23,832
|
22,095
|
|
30.33
|
|
68.66
|
|
|
33,135
|
22,573
|
|
46.79
|
|
Stockholders'
equity
|
401,353
|
404,033
|
396,537
|
400,422
|
406,135
|
|
(0.66)
|
|
(1.18)
|
|
|
403,506
|
409,423
|
|
(1.45)
|
|
Total liabilities and stockholders'
equity
|
$
4,218,643
|
$
3,904,064
|
$
3,437,908
|
$
3,283,295
|
$
3,190,462
|
|
8.06
|
%
|
32.23
|
%
|
|
$
4,063,225
|
$
3,272,078
|
|
24.18
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Memo: Average PPP
loans
|
$
2,407
|
$
3,001
|
$
5,926
|
$ 11,868
|
$ 23,950
|
|
(19.79)
|
%
|
(89.95)
|
%
|
|
$
2,702
|
$ 37,644
|
|
(92.82)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Interest Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans held for
sale
|
$
700
|
$
391
|
$
349
|
$
263
|
$
93
|
|
79.03
|
%
|
NM
|
%
|
|
$
1,091
|
$
93
|
|
NM
|
%
|
Loans
|
|
|
43,270
|
40,915
|
35,841
|
30,225
|
26,244
|
|
5.75
|
|
64.88
|
|
|
84,185
|
50,967
|
|
65.17
|
|
Investment
securities
|
1,551
|
1,584
|
1,571
|
1,518
|
1,445
|
|
(2.08)
|
|
7.34
|
|
|
3,135
|
2,874
|
|
9.08
|
|
Other earning
assets
|
7,158
|
4,224
|
834
|
555
|
448
|
|
69.46
|
|
NM
|
|
|
11,382
|
855
|
|
NM
|
|
Total Earning
Assets
|
52,679
|
47,114
|
38,595
|
32,561
|
28,230
|
|
11.81
|
|
86.61
|
|
|
99,793
|
54,789
|
|
82.14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest bearing
DDA
|
-
|
-
|
-
|
-
|
-
|
|
-
|
|
-
|
|
|
-
|
-
|
|
-
|
|
NOW and other
interest-bearing demand accounts
|
4,343
|
2,267
|
544
|
536
|
556
|
|
91.57
|
|
NM
|
|
|
6,610
|
1,222
|
|
NM
|
|
Money market
accounts
|
6,231
|
4,801
|
2,894
|
1,667
|
938
|
|
29.79
|
|
NM
|
|
|
11,032
|
1,797
|
|
NM
|
|
Savings
accounts
|
10,405
|
4,750
|
305
|
141
|
142
|
|
119.05
|
|
NM
|
|
|
15,156
|
291
|
|
NM
|
|
Time
deposits
|
|
3,804
|
3,226
|
1,567
|
943
|
674
|
|
17.92
|
|
NM
|
|
|
7,029
|
1,374
|
|
NM
|
|
Total Deposit Costs
|
24,783
|
15,044
|
5,310
|
3,287
|
2,310
|
|
64.74
|
|
NM
|
|
|
39,827
|
4,684
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Borrowings
|
|
1,739
|
3,705
|
3,748
|
1,859
|
1,342
|
|
(53.06)
|
|
29.58
|
|
|
5,444
|
2,699
|
|
101.70
|
|
Total Funding Costs
|
26,522
|
18,749
|
9,058
|
5,146
|
3,652
|
|
41.46
|
|
NM
|
|
|
45,271
|
7,383
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Interest Income
|
$ 26,157
|
$ 28,365
|
$ 29,537
|
$ 27,415
|
$ 24,578
|
|
(7.79)
|
%
|
6.42
|
%
|
|
$ 54,522
|
$ 47,406
|
|
15.01
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Memo: SBA PPP
loan interest and fee income
|
$
6
|
$
3
|
$
14
|
$
28
|
$
59
|
|
100.00
|
%
|
(89.83)
|
%
|
|
$
9
|
$
494
|
|
(98.18)
|
%
|
Memo: SBA PPP
loan funding costs
|
$
2
|
$
3
|
$
5
|
$
10
|
$
21
|
|
(33.33)
|
%
|
(90.48)
|
%
|
|
$
6
|
$
65
|
|
(90.77)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Interest Margin
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans held for
sale
|
5.77 %
|
6.26 %
|
6.18 %
|
4.92 %
|
5.38 %
|
|
(49)
|
bps
|
39
|
bps
|
|
5.93 %
|
5.38 %
|
|
55
|
bps
|
Loans
|
|
|
5.60 %
|
5.55 %
|
5.04 %
|
4.50 %
|
4.20 %
|
|
4
|
|
140
|
|
|
5.57 %
|
4.22 %
|
|
135
|
|
Investments
|
|
2.58 %
|
2.61 %
|
2.46 %
|
2.23 %
|
2.01 %
|
|
(3)
|
|
57
|
|
|
2.60 %
|
1.96 %
|
|
64
|
|
Other Earning
Assets
|
5.05 %
|
4.41 %
|
3.57 %
|
2.44 %
|
1.13 %
|
|
64
|
|
392
|
|
|
4.79 %
|
0.55 %
|
|
424
|
|
Total Earning Assets
|
5.34 %
|
5.24 %
|
4.80 %
|
4.24 %
|
3.82 %
|
|
10
|
|
151
|
|
|
5.29 %
|
3.63 %
|
|
166
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NOW
|
|
|
2.11 %
|
1.27 %
|
0.35 %
|
0.32 %
|
0.32 %
|
|
84
|
|
179
|
|
|
1.72 %
|
0.33 %
|
|
139
|
|
MMDA
|
|
2.91 %
|
2.36 %
|
1.43 %
|
0.82 %
|
0.46 %
|
|
55
|
|
245
|
|
|
2.64 %
|
0.45 %
|
|
219
|
|
Savings
|
|
4.07 %
|
3.24 %
|
0.52 %
|
0.26 %
|
0.26 %
|
|
83
|
|
381
|
|
|
3.77 %
|
0.26 %
|
|
351
|
|
CDs
|
|
|
3.08 %
|
2.68 %
|
1.64 %
|
1.09 %
|
0.82 %
|
|
40
|
|
226
|
|
|
2.88 %
|
0.82 %
|
|
206
|
|
Cost of Interest Bearing
Deposits
|
3.10 %
|
2.32 %
|
1.03 %
|
0.64 %
|
0.45 %
|
|
78
|
|
265
|
|
|
2.75 %
|
0.44 %
|
|
231
|
|
Cost of Deposits
|
2.70 %
|
1.91 %
|
0.78 %
|
0.48 %
|
0.35 %
|
|
79
|
|
235
|
|
|
2.34 %
|
0.35 %
|
|
199
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
Other
Funding
|
|
6.99 %
|
5.27 %
|
4.57 %
|
4.43 %
|
4.99 %
|
|
172
|
|
200
|
|
|
5.72 %
|
3.91 %
|
|
181
|
|
Total Cost of Funds
|
2.81 %
|
2.19 %
|
1.19 %
|
0.71 %
|
0.53 %
|
|
62
|
|
228
|
|
|
2.52 %
|
0.52 %
|
|
200
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Interest Margin
|
2.65 %
|
3.15 %
|
3.67 %
|
3.57 %
|
3.33 %
|
|
(50)
|
|
(68)
|
|
|
2.89 %
|
3.14 %
|
|
(25)
|
|
Net Interest Spread
|
2.12 %
|
2.63 %
|
3.28 %
|
3.31 %
|
3.15 %
|
|
(51)
|
|
(103)
|
|
|
2.35 %
|
2.97 %
|
|
(62)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Memo: Excluding
SBA PPP loans
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans
|
|
5.60 %
|
5.56 %
|
5.05 %
|
4.51 %
|
4.23 %
|
|
4
|
bps
|
137
|
bps
|
|
5.58 %
|
4.25 %
|
|
133
|
bps
|
|
Total Earning
Assets
|
5.34 %
|
5.24 %
|
4.81 %
|
4.25 %
|
3.85 %
|
|
10
|
|
149
|
|
|
5.29 %
|
3.64 %
|
|
165
|
|
|
Net Interest
Margin*
|
2.65 %
|
3.15 %
|
3.68 %
|
3.58 %
|
3.35 %
|
|
(50)
|
|
(70)
|
|
|
2.89 %
|
3.15 %
|
|
(26)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*Net interest margin excluding the effect of SBA PPP
loans assumes a funding cost of 35bps on average PPP balances in
all applicable periods
|
|
The company defines "NM" as not meaningful for
increases or decreases greater than 300
percent.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Primis Financial
Corp.
|
|
|
|
|
|
|
|
|
|
(Dollars in thousands, except per share
data)
|
For Three Months Ended:
|
|
For Six Months Ended:
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Non-GAAP
items:
|
2Q 2023
|
1Q 2023
|
4Q 2022
|
3Q 2022
|
2Q 2022
|
|
2Q 2023
|
2Q 2022
|
Net income
|
|
$
(188)
|
$
5,953
|
$
3,040
|
$
5,025
|
$
4,948
|
|
$ 5,765
|
|
$ 9,484
|
Non-GAAP adjustments
to Net Income:
|
|
|
|
|
|
|
|
|
|
|
Branch Consolidation /
Other restructuring
|
1,488
|
-
|
1,175
|
308
|
901
|
|
1,488
|
|
901
|
|
(Gain) on sale of
Infinex investment
|
-
|
-
|
(4,144)
|
-
|
-
|
|
-
|
|
-
|
|
Merger
expenses
|
-
|
-
|
-
|
-
|
401
|
|
-
|
|
516
|
|
Income tax
effect
|
(321)
|
-
|
641
|
(67)
|
(281)
|
|
(321)
|
|
(306)
|
|
Net income adjusted for
nonrecurring income and expenses
|
$
979
|
$
5,953
|
$
712
|
$
5,266
|
$
5,969
|
|
$ 6,932
|
|
$
10,595
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
(188)
|
$
5,953
|
$
3,040
|
$
5,025
|
$
4,948
|
|
$ 5,765
|
|
$ 9,484
|
|
Income tax
expense
|
(22)
|
1,353
|
519
|
1,359
|
1,361
|
|
1,331
|
|
2,612
|
|
Provision for credit
losses (incl. unfunded commitment expense)
|
4,067
|
5,278
|
7,896
|
3,201
|
254
|
|
4,067
|
|
613
|
Pre-tax pre-provision
earnings
|
$
3,857
|
$ 12,584
|
$ 11,455
|
$
9,585
|
$
6,563
|
|
$
11,164
|
|
$
12,710
|
|
Effect of adjustment
for nonrecurring income and expenses
|
1,488
|
-
|
(2,969)
|
308
|
1,302
|
|
1,488
|
|
1,417
|
Pre-tax pre-provision
operating earnings
|
$
5,345
|
$ 12,584
|
$
8,486
|
$
9,893
|
$
7,865
|
|
$
12,652
|
|
$
14,127
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average
assets
|
(0.02 %)
|
0.62 %
|
0.35 %
|
0.61 %
|
0.62 %
|
|
0.29 %
|
|
0.58 %
|
|
Effect of adjustment
for nonrecurring income and expenses
|
0.11 %
|
0.00 %
|
(0.27 %)
|
0.03 %
|
0.13 %
|
|
0.06 %
|
|
0.07 %
|
Operating return on
average assets
|
0.09 %
|
0.62 %
|
0.08 %
|
0.64 %
|
0.75 %
|
|
0.34 %
|
|
0.65 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average
assets
|
(0.02 %)
|
0.62 %
|
0.35 %
|
0.61 %
|
0.62 %
|
|
0.29 %
|
|
0.58 %
|
|
Effect of tax
expense
|
(0.00 %)
|
0.14 %
|
0.06 %
|
0.16 %
|
0.17 %
|
|
0.07 %
|
|
0.16 %
|
|
Effect of provision for
credit losses (incl. unfunded commitment expense)
|
0.39 %
|
0.55 %
|
0.91 %
|
0.39 %
|
0.03 %
|
|
0.20 %
|
|
0.04 %
|
Pre-tax pre-provision
return on average assets
|
0.37 %
|
1.31 %
|
1.32 %
|
1.16 %
|
0.83 %
|
|
0.55 %
|
|
0.78 %
|
|
Effect of adjustment
for nonrecurring income and expenses and expenses
|
0.14 %
|
0.00 %
|
(0.34 %)
|
0.04 %
|
0.16 %
|
|
0.07 %
|
|
0.09 %
|
Pre-tax pre-provision
operating return on average assets
|
0.51 %
|
1.31 %
|
0.98 %
|
1.20 %
|
0.99 %
|
|
0.63 %
|
|
0.87 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average
equity
|
(0.19 %)
|
5.98 %
|
3.04 %
|
4.98 %
|
4.89 %
|
|
2.88 %
|
|
4.67 %
|
|
Effect of adjustment
for nonrecurring income and expenses
|
1.17 %
|
0.00 %
|
(2.33 %)
|
0.24 %
|
1.01 %
|
|
0.58 %
|
|
0.55 %
|
Operating return on
average equity
|
0.98 %
|
5.98 %
|
0.71 %
|
5.22 %
|
5.90 %
|
|
3.46 %
|
|
5.22 %
|
|
Effect of goodwill and
other intangible assets
|
0.36 %
|
2.17 %
|
0.27 %
|
1.93 %
|
2.15 %
|
|
1.26 %
|
|
1.84 %
|
Operating return on
average tangible equity
|
1.33 %
|
8.14 %
|
0.98 %
|
7.15 %
|
8.05 %
|
|
4.72 %
|
|
7.06 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Efficiency
ratio
|
|
88.19 %
|
68.69 %
|
71.82 %
|
71.93 %
|
75.26 %
|
|
77.75 %
|
|
75.79 %
|
|
Effect of adjustment
for nonrecurring income and expenses
|
(4.30 %)
|
0.00 %
|
4.95 %
|
(0.93 %)
|
(4.79 %)
|
|
(2.00 %)
|
|
(2.72 %)
|
Operating efficiency
ratio
|
83.90 %
|
68.69 %
|
76.78 %
|
70.99 %
|
70.48 %
|
|
75.76 %
|
|
73.08 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share -
Basic
|
$
(0.01)
|
$
0.24
|
$
0.12
|
$
0.20
|
$
0.20
|
|
$ 0.23
|
|
$ 0.39
|
|
Effect of adjustment
for nonrecurring income and expenses
|
0.05
|
-
|
(0.09)
|
0.01
|
0.04
|
|
0.05
|
|
0.05
|
Operating earnings per
share - Basic
|
$
0.04
|
$
0.24
|
$
0.03
|
$
0.21
|
$
0.24
|
|
$ 0.28
|
|
$ 0.43
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share -
Diluted
|
$
(0.01)
|
$
0.24
|
$
0.12
|
$
0.20
|
$
0.20
|
|
$ 0.23
|
|
$
0.38
|
|
Effect of adjustment
for nonrecurring income and expenses
|
0.05
|
-
|
(0.09)
|
0.01
|
0.04
|
|
0.05
|
|
0.05
|
Operating earnings per
share - Diluted
|
$
0.04
|
$
0.24
|
$
0.03
|
$
0.21
|
$
0.24
|
|
$ 0.28
|
|
$ 0.43
|
|
|
|
|
|
|
|
|
|
|
|
|
Book value per
share
|
$
15.93
|
$
16.14
|
$
15.90
|
$
15.82
|
$
16.10
|
|
$ 15.93
|
|
$
16.10
|
|
Effect of goodwill and
other intangible assets
|
(4.35)
|
(4.37)
|
(4.37)
|
(4.40)
|
(4.40)
|
|
(4.34)
|
|
(4.40)
|
Tangible book value per
share
|
$
11.58
|
$
11.79
|
$
11.53
|
$
11.43
|
$
11.69
|
|
$ 11.58
|
|
$ 11.69
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders'
equity
|
$ 393,216
|
$ 398,505
|
$ 392,464
|
$ 389,896
|
$ 396,753
|
|
$
393,216
|
|
$ 396,753
|
|
Less goodwill and other
intangible assets
|
(107,215)
|
(107,539)
|
(107,863)
|
(108,147)
|
(108,524)
|
|
(107,215)
|
|
(108,524)
|
Tangible common
equity
|
$ 286,001
|
$ 290,966
|
$ 284,601
|
$ 281,749
|
$ 288,229
|
|
$
286,001
|
|
$ 288,229
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity to
assets
|
|
10.22 %
|
9.48 %
|
10.99 %
|
11.62 %
|
12.27 %
|
|
10.22 %
|
|
12.27 %
|
|
Effect of goodwill and
other intangible assets
|
(2.57 %)
|
(2.38 %)
|
(2.77 %)
|
(2.94 %)
|
(3.05 %)
|
|
(2.57 %)
|
|
(3.05 %)
|
Tangible common equity
to tangible assets
|
7.64 %
|
7.10 %
|
8.22 %
|
8.68 %
|
9.22 %
|
|
7.64 %
|
|
9.22 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
margin
|
2.65 %
|
3.15 %
|
3.67 %
|
3.57 %
|
3.33 %
|
|
2.89 %
|
|
3.14 %
|
|
Effect of adjustments
for PPP associated balances*
|
0.00 %
|
0.01 %
|
0.01 %
|
0.01 %
|
0.02 %
|
|
0.00 %
|
|
0.01 %
|
Core net interest
margin
|
2.65 %
|
3.16 %
|
3.68 %
|
3.58 %
|
3.35 %
|
|
2.89 %
|
|
3.15 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*Net interest margin excluding the effect of PPP
loans assumes a funding cost of 35bps on average PPP balances in
all applicable periods
|
|
|
|
|
|
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SOURCE Primis Financial Corp.