First Bank Announces Third Quarter 2024 Net Income of $8.2 Million

Источник: Nasdaq GlobeNewswire / 23 окт 2024 15:37:01 America/Chicago

Results reflect strong loan and deposit growth, solid asset quality, and balance sheet optimization initiatives

HAMILTON, N.J., Oct. 23, 2024 (GLOBE NEWSWIRE) -- First Bank (Nasdaq Global Market: FRBA) (the Bank) today announced results for the third quarter of 2024. Net income for the third quarter of 2024 was $8.2 million, or $0.32 per diluted share. Return on average assets, return on average equity and return on average tangible equity^[i] for the third quarter of 2024 were 0.88%, 8.15% and 9.42%, respectively. The Bank recorded a net loss of $1.3 million, or a loss of $0.05 per diluted share, and losses on average assets, equity, and tangible equityⁱ of 0.14%, 1.43%, and 1.66%, respectively, for the third quarter of 2023. Financial results for the third quarter of 2023 were negatively impacted by the Malvern Bancorp acquisition, completed in July 2023, primarily due to the merger-related expenses and the initial credit loss expense on acquired loans.

Third Quarter 2024 Performance Highlights:

Total loans of $3.09 billion at September 30, 2024 grew $89.5 million, or 11.9%, annualized, from the linked quarter ended June 30, 2024. Loan growth occurred late in the quarter, which is reflected in average loan balance increase of only $12.2 million during the quarter ended September 30, 2024. The growth was primarily driven by $56.9 million expansion within the Commercial and Industrial and Owner-occupied commercial real estate loan categories.
Total deposits of $3.05 billion at September 30, 2024 grew $82.4 million, or 11.1%, annualized, from the linked quarter. Growth occurred across all deposit categories, as non-interest bearing demand, interest bearing demand, money market and savings, and time deposits increased $19.3 million, $23.3 million, $36.3 million, and $3.6 million, respectively, from the second quarter of 2024.
Tangible book value per share^[ii] grew to $13.84 at September 30, 2024, increasing 11.2%, annualized, from $13.46 at June 30, 2024.
The Bank continued to prioritize balance sheet efficiency, selling approximately $11.7 million of investment securities during the quarter ended September 30, 2024 which resulted in a $555,000 net loss on the sale of investments during the quarter. The Bank also completed a restructuring of its bank-owned life insurance (BOLI) portfolio during the quarter which resulted in approximately $24 million in terminated policies and the acquisition of approximately $20 million in new policies. As a result of the restructure, the Bank recorded a $1.1 million enhancement to the cash surrender value and recognized additional income tax expense totaling $1.2 million.
Strong asset quality continued, with nonperforming assets decreasing by 9 basis points to 0.47% of total assets at September 30, 2024 from 0.56% at June 30, 2024.

Patrick L. Ryan, President and CEO of First Bank, reflected on the Bank’s performance, stating, “First Bank’s outstanding third quarter growth is an outcome of a well-executed long-term strategy. We have worked to build teams, products, and operating structures that promote quality growth over the long term, and the results are evident. Our teams added high-quality loans and deposits across all categories. We also continued to optimize the Bank’s efficiency as our efficiency ratio^[iii] remained below 60% for the 21st consecutive quarter. We continued to enact strategies to enhance future profitability and complement our organic growth efforts including ongoing balance sheet restructuring through the sale of certain lower-yielding investment securities, and we opportunistically restructured our BOLI policies during the quarter, an initiative that will be accretive to future earnings. The current quarter highlighted our efforts to build our core community banking customer base while we expand our specialty banking teams and continued investment in technology to improve the customer experience.”

Mr. Ryan added, “We are pleased with our ability to generate solid returns for our shareholders, including this quarter’s 11% annualized growth in tangible book value per share. We continue to explore a variety of opportunities to drive future earnings. Our recent receipt of regulatory approval to initiate stock repurchases also adds to our toolkit of options to support continued and growing returns for our shareholders.”

Income Statement

In the third quarter of 2024, the Bank’s net interest income increased to $30.1 million, growing $1.5 million, or 5.2%, compared to the same period in 2023. The increase was primarily due to net interest margin expansion in the third quarter of 2024 compared to the third quarter of 2023. Net interest income decreased $446,000, or 1.5%, from the linked second quarter of 2024. The modest decrease was primarily due to net interest margin compression and the timing of our loan growth, which occurred late in the third quarter, limiting interest income received during the quarter. During the third quarter, a $606,000 increase in interest income compared to the second quarter of 2024 was primarily related to higher earning asset balances, which was offset by a $1.1 million increase in interest expense, resulting from increased deposit costs and a higher level of average borrowings.

The Bank’s tax equivalent net interest margin of 3.49% for the third quarter of 2024 represented an increase of 13 basis points from the quarter ended September 30, 2023 and a decrease of 13 basis points from the linked quarter ended June 30, 2024. The Bank’s tax equivalent net interest margin includes the impact of amortization and accretion of premiums and discounts from fair value measurements of assets acquired and liabilities assumed in acquisitions. Amortization of premiums and accretion of discounts from fair value measurements of assets acquired and liabilities assumed in acquisitions totaled $3.4 million during the third quarter of 2024, compared to $2.7 million for the quarter ended September 30, 2023 and $3.6 million for the quarter ended June 30, 2024. The Bank’s net interest margin declined compared to the linked second quarter due to lower acquisition accounting accretion income, increased levels of average borrowings, lower average loan yields, and higher interest bearing deposit costs.

The Bank recorded a credit loss expense totaling $1.6 million during the third quarter of 2024, compared to $63,000 recorded during the second quarter of 2024 and $6.7 million recorded for the third quarter of 2023. The Bank’s credit loss expense for the third quarter of 2024 was commensurate with robust organic loan growth during the quarter and continued to reflect strong and stable asset quality. Credit loss expense for the third quarter of 2023 included a $5.5 million credit loss recorded to establish the allowance for credit losses on the acquired Malvern loan portfolio.

In the third quarter of 2024, the Bank recorded non-interest income of $2.5 million, compared to $193,000 during the same period in 2023 and $689,000 in the second quarter of 2024. The increase in non-interest income was primarily related to approximately $1.1 million in one-time enhancement to the cash surrender value of BOLI that resulted from the aforementioned BOLI restructuring transaction during the quarter, as well as higher yields earned on the new BOLI policies purchased during the quarter. Additionally, the Bank recorded $135,000 in net gains on the sale of loans during third quarter 2024, compared to net losses on the sale of loans totaling $900,000 and $704,000 in the linked and prior year quarters, respectively. This was partially offset by $555,000 in net losses on the sale of investment securities during third quarter 2024, while no investment securities sales were executed in the linked quarter, and $527,000 in net losses were recognized during the third quarter of 2023.

Non-interest expense for the third quarter of 2024 was $18.6 million, a decrease of $4.8 million, or 20.6%, compared to $23.4 million for the prior year quarter. Lower non-interest expense was largely due to $7.0 million in merger-related expenses recorded during the third quarter of 2023. Excluding merger-related expenses, non-interest expense grew $2.2 million, or 13.3%, including an increase of $849,000 in salaries and employee benefits due to merit increases and a larger employee base. Other real estate owned (OREO) expense totaled $662,000 during third quarter 2024, with no similar expense recorded in third quarter 2023. The increase reflects a $363,000 impairment of an OREO asset along with other legal and real estate tax expenses recorded during the quarter. Additionally, other professional fees increased $312,000 primarily related to increases in personnel placement costs, consulting fees, and tax services.

On a linked quarter basis, non-interest expense increased $691,000, or 3.8%, from $18.0 million for the second quarter of 2024. The largest impact on expenses compared to the linked quarter is the aforementioned $363,000 OREO impairment expense during third quarter 2024. Salaries and employee benefits expense increased by $207,000 primarily due to a larger employee base. These were partially offset by modest decreases in marketing and advertising costs, as well as travel and entertainment expenses.

Income tax expense for the three months ended September 30, 2024 was $4.2 million with an effective tax rate of 33.9%, compared to an income tax benefit of $78,000 for the third quarter of 2023 and an income tax expense of $2.1 million with an effective tax rate of 16.2% for the second quarter of 2024. The effective tax rate for the third quarter of 2024 included approximately $1.2 million of tax expense recorded related to the BOLI restructuring. Excluding this impact, the effective tax rate would have been approximately 24% for the third quarter of 2024. The effective tax rate for the second quarter of 2024 was lower compared to the first quarter due to the recently enacted New Jersey Corporate Transit Fee, which resulted in a change in tax rate and a revaluation of the Bank’s deferred tax assets. A tax benefit of $1.1 million was booked as a discrete item in the second quarter for this change in tax rate. With the expected negative ongoing impact of the New Jersey Corporate Transit Fee, we anticipate our future effective tax rate will range between 24% and 25%.

Balance Sheet

Total assets increased $148.3 million, or 4.1%, from December 31, 2023 to September 30, 2024. Total loans increased $66.0 million, or 2.2%, from December 31, 2023 to September 30, 2024. Growth totaling $116.3 million across the owner-occupied commercial real estate and commercial and industrial loan portfolios was partially offset by a decline of commercial investor real estate loans totaling $47.8 million, including multi-family and construction and development, during the first nine months of 2024. The Bank continues to prioritize relationship-based commercial and industrial lending while actively managing our exposure in investor real estate lending.

Total assets grew $141.9 million, or 15.6% annualized, during the quarter ended September 30, 2024. Growth included an increase of $71.5 million in cash and cash equivalents related to the opportunistic addition of FHLB advances when interest rates declined during the quarter. Total loans increased by $89.5 million, or 11.9%, annualized, during the quarter ended September 30, 2024. Growth across the owner-occupied commercial real estate and commercial and industrial loan portfolios totaled $56.9 million, while commercial investor real estate loans, including multi-family and construction and development, grew $27.5 million, and consumer and residential real estate loans grew $5.2 million.

Total deposits increased by $82.4 million, or 11.1% annualized, during the quarter ended September 30, 2024. Growth occurred across all categories, with non-interest bearing demand, interest bearing demand, money market and savings, and time deposits increasing $19.3 million, $23.3 million, $36.3 million, and $3.6 million, respectively, from the second quarter of 2024. Our team continued to focus on attracting new deposit relationships while maintaining existing core balances.

Nearly all of the Bank’s deposit growth for the first nine months of 2024 occurred during the quarter ended September 30, 2024. We also experienced a slight shift in the mix of customer balances over the nine-month period. The Bank grew non-interest bearing demand deposits by $17.3 million in a challenging interest rate environment, while total interest-bearing deposits experienced a shift toward higher-costing deposits. During the first nine months of 2024, increases in money market and savings deposits and time deposits totaled $64.2 million and $32.3 million, respectively, partially offset by a decline in interest bearing demand deposits totaling $31.3 million.

During the nine months ended September 30, 2024, stockholders’ equity increased by $31.2 million, primarily due to net income, partially offset by dividends.

As of September 30, 2024, the Bank continued to exceed all regulatory capital requirements to be considered well-capitalized, with a Tier 1 Leverage ratio of 9.53%, a Tier 1 Risk-Based capital ratio of 9.65%, a Common Equity Tier 1 Capital ratio of 9.65%, and a Total Risk-Based capital ratio of 11.55%. The tangible stockholders' equity to tangible assets ratio^[IV] increased to 9.41% as of September 30, 2024 compared to 8.89% at December 31, 2023.

Asset Quality

First Bank's asset quality metrics for the third quarter of 2024 remained favorable. Total nonperforming loans declined from $25.0 million at December 31, 2023 to $12.0 million at September 30, 2024, while total nonperforming assets declined from $25.0 million to $17.7 million during the same period.

The Bank recorded net charge-offs of $386,000 during the third quarter of 2024, compared to net charge-offs of $175,000 during the second quarter of 2024 and net charge-offs of $1.1 million in the third quarter of 2023. The allowance for credit losses on loans as a percentage of total loans measured 1.21% at September 30, 2024, compared to 1.21% at June 30, 2024 and 1.40% at December 31, 2023. The decline from December 31, 2023 to September 30, 2024 reflected the $5.5 million charge-off and elimination of the Bank’s reserves on a purchase credit deteriorated loan transferred to OREO during the first quarter of 2024.

Liquidity and Borrowings

The Bank increased its liquidity position in the third quarter of 2024. Total cash and cash equivalents increased by $71.5 million to $312.3 million at September 30, 2024. Borrowings increased by $49.9 million compared to June 30, 2024, as the Bank increased its FHLB borrowings.

Management believes the Bank’s current liquidity position, coupled with our various contingent funding sources, provides us with a strong liquidity base and a diverse source of funding options.

Cash Dividend Declared

On October 15, 2024, the Bank’s Board of Directors declared a quarterly cash dividend of $0.06 per share to common stockholders of record at the close of business on November 8, 2024, payable on November 22, 2024.

Share Repurchase Program

The Board of Directors has authorized and the Bank has received regulatory approvals for a new share repurchase program. The program provides for the repurchase of up to 1.0 million shares of First Bank common stock for an aggregate repurchase amount of up to $16.0 million. The timing, price and volume of repurchases will be based on market conditions, relevant securities laws and other factors. The stock repurchases may be made from time to time on the open market or in privately negotiated transactions. The stock repurchase program does not require First Bank to repurchase any specific number of shares, and First Bank may terminate the repurchase program at any time. The share repurchase program will expire on September 30, 2025.

Conference Call and Earnings Release Supplement

Additional details on the quarterly results and the Bank are included in the attached earnings release supplement. http://ml.globenewswire.com/Resource/Download/8c344bfa-6975-4f79-872b-2307433b1520

First Bank will host its earnings call on Thursday, October 24, 2024 at 9:00 AM Eastern Time. The direct dial toll free number for the live call is 1-800-715-9871 and the access code is 1578641. For those unable to participate in the call, a replay will be available by dialing 1-800-770-2030 (access code 8550862) from one hour after the end of the conference call until January 22, 2025. Replay information will also be available on First Bank’s website at www.firstbanknj.com under the “About Us” tab. Click on “Investor Relations” to access the replay of the conference call.

About First Bank

First Bank is a New Jersey state-chartered bank with 26 full-service branches in Cinnaminson, Delanco, Denville, Ewing, Fairfield, Flemington (2), Hamilton, Lawrence, Monroe, Morristown, Pennington, Randolph, Somerset and Williamstown, New Jersey; and Coventry, Devon, Doylestown, Glenn Mills, Lionville, Malvern, Paoli, Trevose, Warminster and West Chester, Pennsylvania; and Palm Beach, Florida. With $3.76 billion in assets as of September 30, 2024, First Bank offers a full range of deposit and loan products to individuals and businesses throughout the New York City to Philadelphia corridor. First Bank's common stock is listed on the Nasdaq Global Market under the symbol “FRBA.”

Forward Looking Statements

This press release contains certain forward-looking statements, either express or implied, within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include information regarding First Bank’s future financial performance, business and growth strategy, projected plans and objectives, and related transactions, integration of acquired businesses, ability to recognize anticipated operational efficiencies, and other projections based on macroeconomic and industry trends, which are inherently unreliable due to the multiple factors that impact economic trends, and any such variations may be material. Such forward-looking statements are based on various facts and derived utilizing important assumptions, current expectations, estimates and projections about First Bank, any of which may change over time and some of which may be beyond First Bank’s control. Statements preceded by, followed by or that otherwise include the words “believes,” “expects,” “anticipates,” “intends,” “projects,” “estimates,” “plans” and similar expressions or future or conditional verbs such as “will,” “should,” “would,” “may” and “could” are generally forward-looking in nature and not historical facts, although not all forward-looking statements include the foregoing. Further, certain factors that could affect our future results and cause actual results to differ materially from those expressed in the forward-looking statements include, but are not limited to: changes in market interest rates on funding costs, yield on interest earning assets, credit quality and strength of underlying collateral and the effect of such changes on the market value of First Bank's investment securities portfolio; whether First Bank can: successfully implement its growth strategy, including identifying acquisition targets and consummating suitable acquisitions, integrate acquired entities and realize anticipated efficiencies, sustain its internal growth rate, and provide competitive products and services that appeal to its customers and target markets; difficult market conditions and unfavorable economic trends in the United States generally, and particularly in the market areas in which First Bank operates and in which its loans are concentrated, including the effects of declines in housing market values; the effects of the recent turmoil in the banking industry (including the failures of two financial institutions in early 2023); the impact of public health emergencies, such as COVID-19, on First Bank, its operations and its customers and employees; an increase in unemployment levels and slowdowns in economic growth; First Bank's level of nonperforming assets and the costs associated with resolving any problem loans including litigation and other costs; the extensive federal and state regulation, supervision and examination governing almost every aspect of First Bank's operations, including changes in regulations affecting financial institutions and expenses associated with complying with such regulations; uncertainties in tax estimates and valuations, including due to changes in state and federal tax law; First Bank's ability to comply with applicable capital and liquidity requirements, including First Bank’s ability to generate liquidity internally or raise capital on favorable terms, including continued access to the debt and equity capital markets; and possible changes in trade, monetary and fiscal policies, laws and regulations and other activities of governments, agencies, and similar organizations. For discussion of these and other risks that may cause actual results to differ from expectations, please refer to “Forward-Looking Statements” and “Risk Factors” in First Bank’s Annual Report on Form 10-K and any updates to those risk factors set forth in First Bank’s proxy statement, subsequent Quarterly Reports on Form 10-Q or Current Reports on Form 8-K. If one or more events related to these or other risks or uncertainties materialize, or if First Bank’s underlying assumptions prove to be incorrect, actual results may differ materially from what First Bank anticipates. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and First Bank does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise. All forward-looking statements, expressed or implied, included in this communication are expressly qualified in their entirety by this cautionary statement. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that First Bank or persons acting on First Bank’s behalf may issue.

_____________

ⁱ Return on average tangible equity is a non-U.S. GAAP financial measure and is calculated by dividing net income by average tangible equity (average equity minus average goodwill and other intangible assets). For a reconciliation of this non-U.S. GAAP financial measure, along with the other non-U.S. GAAP financial measures in this press release, to their comparable U.S. GAAP measures, see the financial reconciliations at the end of this press release.

ⁱⁱ Tangible book value per share is a non-U.S. GAAP financial measure and is calculated by dividing common shares outstanding by tangible equity (equity minus goodwill and other intangible assets). For a reconciliation of this non-U.S. GAAP financial measure, along with the other non-U.S. GAAP financial measures in this press release, to their comparable U.S. GAAP measures, see the financial reconciliations at the end of this press release.

ⁱⁱⁱ The efficiency ratio is a non-U.S. GAAP financial measure and is calculated by dividing non-interest expense less merger-related expenses by adjusted total revenue (net interest income plus non-interest income). For a reconciliation of this non-U.S. GAAP financial measure, along with the other non-U.S. GAAP financial measures in this press release, to their comparable U.S. GAAP measures, see the financial reconciliations at the end of this press release.

^iv Tangible stockholders' equity to tangible assets ratio is a non-U.S. GAAP financial measure and is calculated by dividing tangible equity (equity minus goodwill and other intangible assets) by tangible assets (total assets minus goodwill and other intangible assets). For a reconciliation of this non-U.S. GAAP financial measure, along with the other non-U.S. GAAP financial measures in this press release, to their comparable U.S. GAAP measures, see the financial reconciliations at the end of this press release.

FIRST BANK
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(in thousands, except for share data, unaudited)

	September 30, 2024			December 31, 2023
Assets
Cash and due from banks	$	35,456		$	25,652
Restricted cash		9,200			13,770
Interest bearing deposits with banks		267,643			188,529
Cash and cash equivalents		312,299			227,951
Interest bearing time deposits with banks		743			996
Investment securities available for sale, at fair value		74,549			94,142
Investment securities held to maturity, net of allowance for credit losses of $206 at September 30, 2024 and $200 at December 31, 2023 (fair value of $39,049 and $38,486 at September 30, 2024 and December 31, 2023, respectively)		43,659			44,059
Equity securities, at fair value		1,860			1,888
Restricted investment in bank stocks		13,845			10,469
Other investments		11,141			9,841
Loans, net of deferred fees and costs		3,087,488			3,021,501
Less: Allowance for credit losses		(37,434	)		(42,397	)
Net loans		3,050,054			2,979,104
Premises and equipment, net		20,331			21,627
Other real estate owned, net		5,637			-
Accrued interest receivable		13,502			14,763
Bank-owned life insurance		84,727			86,435
Goodwill		44,166			44,166
Other intangible assets, net		9,318			10,812
Deferred income taxes, net		31,448			30,875
Other assets		40,374			32,199
Total assets	$	3,757,653		$	3,609,327

Liabilities and Stockholders' Equity
Liabilities:
Non-interest bearing deposits	$	519,079		$	501,763
Interest bearing deposits		2,530,991			2,465,806
Total deposits		3,050,070			2,967,569
Borrowings		236,999			179,140
Subordinated debentures		29,926			55,261
Accrued interest payable		5,078			2,813
Other liabilities		33,510			33,644
Total liabilities		3,355,583			3,238,427
Stockholders' Equity:
Preferred stock, par value $2 per share; 10,000,000 shares authorized; no shares issued and outstanding		-			-
Common stock, par value $5 per share; 40,000,000 shares authorized; 27,367,984 shares issued and 25,186,920 shares outstanding at September 30, 2024 and 27,149,186 shares issued and 24,968,122 shares outstanding at December 31, 2023		135,415			134,552
Additional paid-in capital		124,014			122,881
Retained earnings		167,792			140,563
Accumulated other comprehensive loss		(3,773	)		(5,718	)
Treasury stock, 2,181,064 shares at September 30, 2024 and December 31, 2023		(21,378	)		(21,378	)
Total stockholders' equity		402,070			370,900
Total liabilities and stockholders' equity	$	3,757,653		$	3,609,327

FIRST BANK
CONSOLIDATED STATEMENTS OF INCOME (LOSS)
(in thousands, except for share data, unaudited)

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2024			2023			2024			2023
Interest and Dividend Income
Investment securities—taxable	$	1,201		$	1,151		$	3,661		$	3,128
Investment securities—tax-exempt		35			86			109			158
Interest bearing deposits with banks, Federal funds sold and other		3,972			2,593			10,479			6,029
Loans, including fees		50,957			46,088			151,039			111,536
Total interest and dividend income		56,165			49,918			165,288			120,851

Interest Expense
Deposits		23,081			18,470			66,253			40,574
Borrowings		2,550			1,914			6,859			4,939
Subordinated debentures		440			940			1,224			1,821
Total interest expense		26,071			21,324			74,336			47,334
Net interest income		30,094			28,594			90,952			73,517
Credit loss expense		1,579			6,650			944			8,237
Net interest income after credit loss expense		28,515			21,944			90,008			65,280

Non-Interest Income
Service fees on deposit accounts		362			280			1,056			741
Loan fees		218			152			437			259
Income from bank-owned life insurance		1,819			544			3,213			1,291
Losses on sale of investment securities, net		(555	)		(527	)		(555	)		(734	)
Gains (losses) on sale of loans, net		135			(704	)		(536	)		(393	)
Gains on recovery of acquired loans		35			24			209			95
Other non-interest income		465			424			1,308			1,026
Total non-interest income		2,479			193			5,132			2,285

Non-Interest Expense
Salaries and employee benefits		10,175			9,326			30,181			25,320
Occupancy and equipment		2,080			1,915			6,188			5,107
Legal fees		245			270			801			671
Other professional fees		943			631			2,628			1,880
Regulatory fees		728			595			1,970			1,345
Directors' fees		272			224			784			631
Data processing		800			907			2,355			2,206
Marketing and advertising		310			220			983			693
Travel and entertainment		233			140			762			519
Insurance		245			272			740			624
Other real estate owned expense, net		662			-			879			38
Merger-related expenses		-			7,028			-			7,710
Other expense		1,951			1,958			6,136			4,020
Total non-interest expense		18,644			23,486			54,407			50,764
Income Before Income Taxes		12,350			(1,349	)		40,733			16,801
Income tax expense		4,188			(78	)		8,986			4,284
Net Income (loss)	$	8,162		$	(1,271	)	$	31,747		$	12,517

Basic earnings (loss) per common share	$	0.32		$	(0.05	)	$	1.26		$	0.60
Diluted earnings (loss) per common share	$	0.32		$	(0.05	)	$	1.26		$	0.59

Basic weighted average common shares outstanding		25,172,927			23,902,478			25,114,685			20,928,847
Diluted weighted average common shares outstanding		25,342,462			23,902,478			25,265,250			21,057,655

FIRST BANK
AVERAGE BALANCE SHEETS WITH INTEREST AND AVERAGE RATES
(dollars in thousands, unaudited)

	Three Months Ended September 30,
	2024								2023
	Average						Average		Average						Average
	Balance			Interest			Rate⁽⁵⁾		Balance			Interest			Rate⁽⁵⁾
Interest earning assets
Investment securities ^{(1) (2)}	$	137,216		$	1,244		3.61	%	$	169,244		$	1,255			2.94	%
Loans ⁽³⁾		3,010,116			50,957		6.73	%		3,003,703			46,088			6.09	%
Interest bearing deposits with banks,
Federal funds sold and other		265,474			3,593		5.38	%		182,128			2,395			5.22	%
Restricted investment in bank stocks		12,768			257		8.01	%		10,284			196			7.56	%
Other investments		12,776			122		3.80	%		9,162			2			0.09	%
Total interest earning assets ⁽²⁾		3,438,350			56,173		6.50	%		3,374,521			49,936			5.87	%
Allowance for credit losses		(36,612	)							(41,216	)
Non-interest earning assets		271,105								232,045
Total assets	$	3,672,843							$	3,565,350

Interest bearing liabilities
Interest bearing demand deposits	$	587,045		$	3,974		2.69	%	$	674,417		$	4,038			2.38	%
Money market deposits		1,064,045			10,573		3.95	%		952,042			8,386			3.49	%
Savings deposits		149,057			563		1.50	%		174,412			490			1.11	%
Time deposits		690,723			7,902		4.55	%		655,288			5,556			3.36	%
Total interest bearing deposits		2,490,870			23,012		3.68	%		2,456,159			18,470			2.98	%
Borrowings		206,588			2,550		4.91	%		163,746			1,914			4.64	%
Subordinated debentures		29,908			440		5.88	%		51,101			940			7.36	%
Total interest bearing liabilities		2,727,366			26,002		3.79	%		2,671,006			21,324			3.17	%
Non-interest bearing deposits		506,084								507,866
Other liabilities		40,858								33,106
Stockholders' equity		398,535								353,372
Total liabilities and stockholders' equity	$	3,672,843							$	3,565,350
Net interest income/interest rate spread ⁽²⁾					30,171		2.71	%					28,612			2.70	%
Net interest margin ^{(2) (4)}							3.49	%								3.36	%
Tax equivalent adjustment ⁽²⁾					(8	)							(18	)
Net interest income				$	30,163							$	28,594

(1) Average balance of investment securities available for sale is based on amortized cost.
(2) Interest and average rates are presented on a tax equivalent basis using a federal income tax rate of 21%.
(3) Average balances of loans include loans on nonaccrual status.
(4) Net interest income divided by average total interest earning assets.
(5) Annualized.

FIRST BANK
AVERAGE BALANCE SHEETS WITH INTEREST AND AVERAGE RATES
(dollars in thousands, unaudited)

	Nine Months Ended September 30,
	2024								2023
	Average						Average		Average						Average
	Balance			Interest			Rate⁽⁵⁾		Balance			Interest			Rate⁽⁵⁾
Interest earning assets
Investment securities ^{(1) (2)}	$	143,528		$	3,793		3.53	%	$	155,128		$	3,319		2.86	%
Loans ⁽³⁾		2,995,895			151,039		6.73	%		2,590,409			111,536		5.76	%
Interest bearing deposits with banks,
Federal funds sold and other		231,171			9,404		5.43	%		143,922			5,403		5.02	%
Restricted investment in bank stocks		11,461			699		8.15	%		9,327			454		6.51	%
Other investments		12,262			376		4.10	%		8,902			172		2.58	%
Total interest earning assets ⁽²⁾		3,394,317			165,311		6.51	%		2,907,688			120,884		5.56	%
Allowance for credit losses		(37,000	)							(33,664	)
Non-interest earning assets		265,368								174,246
Total assets	$	3,622,685							$	3,048,270

Interest bearing liabilities
Interest bearing demand deposits	$	599,025		$	11,453		2.55	%	$	445,318		$	6,492		1.95	%
Money market deposits		1,046,911			30,921		3.95	%		840,688			20,177		3.21	%
Savings deposits		156,416			1,756		1.50	%		155,370			1,202		1.03	%
Time deposits		680,194			22,054		4.33	%		586,827			12,703		2.89	%
Total interest bearing deposits		2,482,546			66,184		3.56	%		2,028,203			40,574		2.67	%
Borrowings		181,844			6,859		5.04	%		149,042			4,939		4.43	%
Subordinated debentures		34,071			1,224		4.79	%		36,949			1,821		6.57	%
Total interest bearing liabilities		2,698,461			74,267		3.68	%		2,214,194			47,334		2.86	%
Non-interest bearing deposits		494,971								490,211
Other liabilities		41,971								29,939
Stockholders' equity		387,282								313,926
Total liabilities and stockholders' equity	$	3,622,685							$	3,048,270
Net interest income/interest rate spread ⁽²⁾					91,044		2.83	%					73,550		2.70	%
Net interest margin ^{(2) (4)}							3.58	%							3.38	%
Tax equivalent adjustment ⁽²⁾					(23	)							(33	)
Net interest income				$	91,021							$	73,517

FIRST BANK
QUARTERLY FINANCIAL HIGHLIGHTS
(in thousands, except for share and employee data, unaudited)

	As of or For the Quarter Ended
	9/30/2024			6/30/2024			3/31/2024			12/31/2023			9/30/2023
EARNINGS
Net interest income	$	30,094		$	30,540		$	30,318		$	30,999		$	28,594
Credit loss (benefit) expense		1,579			63			(698	)		(294	)		6,650
Non-interest income		2,479			689			1,964			(3,000	)		193
Non-interest expense		18,644			17,953			17,810			17,936			23,486
Income tax expense		4,188			2,140			2,658			1,977			(78	)
Net income		8,162			11,073			12,512			8,380			(1,271	)

PERFORMANCE RATIOS
Return on average assets ⁽¹⁾		0.88	%		1.23	%		1.41	%		0.93	%		(0.14	%)
Adjusted return on average assets ^{(1) (2)}		0.93	%		1.31	%		1.39	%		1.38	%		1.07	%
Return on average equity ⁽¹⁾		8.15	%		11.52	%		13.36	%		9.06	%		(1.43	%)
Adjusted return on average equity ^{(1) (2)}		8.56	%		12.26	%		13.17	%		13.38	%		10.75	%
Return on average tangible equity ^{(1) (2)}		9.42	%		13.40	%		15.64	%		10.67	%		(1.66	%)
Adjusted return on average tangible equity ^{(1) (2)}		9.89	%		14.26	%		15.41	%		15.75	%		12.50	%
Net interest margin ^{(1) (3)}		3.49	%		3.62	%		3.64	%		3.68	%		3.36	%
Yield on loans ⁽¹⁾		6.73	%		6.81	%		6.66	%		6.49	%		6.09	%
Total cost of deposits ⁽¹⁾		3.05	%		3.01	%		2.83	%		2.63	%		2.47	%
Efficiency ratio ⁽²⁾		58.49	%		55.88	%		55.56	%		53.79	%		54.83	%

SHARE DATA
Common shares outstanding		25,186,920			25,144,983			25,096,449			24,968,122			24,926,919
Basic earnings per share	$	0.32		$	0.44		$	0.50		$	0.34		$	(0.05	)
Diluted earnings per share		0.32			0.44			0.50			0.33			(0.05	)
Adjusted diluted earnings per share ⁽²⁾		0.34			0.47			0.49			0.49			0.40
Book value per share		15.96			15.61			15.23			14.85			14.48
Tangible book value per share ⁽²⁾		13.84			13.46			13.06			12.65			12.26

MARKET DATA
Market value per share	$	15.20		$	12.74		$	13.74		$	14.70		$	10.78
Market value / Tangible book value		109.83	%		94.65	%		105.20	%		116.18	%		87.96	%
Market capitalization	$	382,841		$	320,347		$	344,825		$	367,031		$	268,712

CAPITAL & LIQUIDITY
Stockholders' equity / assets		10.70	%		10.86	%		10.64	%		10.28	%		10.15	%
Tangible stockholders' equity / tangible assets ⁽²⁾		9.41	%		9.50	%		9.27	%		8.89	%		8.72	%
Loans / deposits		101.23	%		101.02	%		100.75	%		101.82	%		101.80	%

ASSET QUALITY
Net charge-offs	$	386		$	175		$	5,293		$	209		$	1,122
Net charge-offs (recoveries), excluding PCD loan charge-off ⁽⁴⁾		386			175			(201	)		209			1,122
Nonperforming loans		12,014			14,227			17,054			24,989			24,158
Nonperforming assets		17,651			20,226			23,053			24,989			24,158
Net charge offs / average loans ⁽¹⁾		0.05	%		0.02	%		0.72	%		0.03	%		0.15	%
Net charge offs (recoveries), excluding PCD loan charge-off / average loans ^{(1) (4)}		0.05	%		0.02	%		(0.03	%)		0.03	%		0.15	%
Nonperforming loans / total loans		0.39	%		0.47	%		0.57	%		0.83	%		0.80	%
Nonperforming assets / total assets		0.47	%		0.56	%		0.64	%		0.69	%		0.68	%
Allowance for credit losses on loans / total loans		1.21	%		1.21	%		1.22	%		1.40	%		1.42	%
Allowance for credit losses on loans / nonperforming loans		311.59	%		254.81	%		213.42	%		169.66	%		177.50	%

OTHER DATA
Total assets	$	3,757,653		$	3,615,731		$	3,591,398		$	3,609,327		$	3,558,426
Total loans		3,087,488			2,998,029			2,992,423			3,021,501			3,020,778
Total deposits		3,050,070			2,967,634			2,970,262			2,967,569			2,967,455
Total stockholders' equity		402,070			392,489			382,254			370,900			361,037
Number of full-time equivalent employees		313			294			288			286			286

(1) Annualized.
(2) Non-U.S. GAAP financial measure that we believe provides management and investors with information that is useful in understanding our financial performance and condition. See accompanying table, "Non-U.S. GAAP Financial Measures," for calculation and reconciliation.
(3) Tax equivalent using a federal income tax rate of 21%.
(4) Excludes $5.5 million in a PCD loan charge-off in first quarter of 2024, which was reserved for through purchase accounting marks at the time of the Malvern acquisition.

FIRST BANK
QUARTERLY FINANCIAL HIGHLIGHTS
(dollars in thousands, unaudited)

	As of the Quarter Ended
	9/30/2024			6/30/2024			3/31/2024			12/31/2023			9/30/2023
LOAN COMPOSITION
Commercial and industrial	$	546,541		$	530,996		$	508,911		$	506,849		$	478,120
Commercial real estate:
Owner-occupied		688,988			647,625			625,643			612,352			607,888
Investor		1,170,508			1,143,954			1,172,311			1,221,702			1,269,134
Construction and development		193,460			190,108			184,816			186,829			168,192
Multi-family		267,861			270,238			279,668			271,058			275,825
Total commercial real estate		2,320,817			2,251,925			2,262,438			2,291,941			2,321,039
Residential real estate:
Residential mortgage and first lien home equity loans		143,953			144,978			154,704			156,024			158,487
Home equity–second lien loans and revolving lines of credit		49,891			46,882			45,869			44,698			46,239
Total residential real estate		193,844			191,860			200,573			200,722			204,726
Consumer and other		29,518			26,321			23,702			25,343			20,208
Total loans prior to deferred loan fees and costs		3,090,720			3,001,102			2,995,624			3,024,855			3,024,093
Net deferred loan fees and costs		(3,232	)		(3,073	)		(3,201	)		(3,354	)		(3,315	)
Total loans	$	3,087,488		$	2,998,029		$	2,992,423		$	3,021,501		$	3,020,778

LOAN MIX
Commercial and industrial		17.7	%		17.7	%		17.0	%		16.8	%		15.8	%
Commercial real estate:
Owner-occupied		22.3	%		21.6	%		20.9	%		20.3	%		20.1	%
Investor		37.9	%		38.2	%		39.2	%		40.4	%		42.0	%
Construction and development		6.3	%		6.3	%		6.2	%		6.2	%		5.6	%
Multi-family		8.7	%		9.0	%		9.3	%		9.0	%		9.1	%
Total commercial real estate		75.2	%		75.1	%		75.6	%		75.9	%		76.8	%
Residential real estate:
Residential mortgage and first lien home equity loans		4.7	%		4.8	%		5.2	%		5.1	%		5.3	%
Home equity–second lien loans and revolving lines of credit		1.6	%		1.6	%		1.5	%		1.5	%		1.5	%
Total residential real estate		6.3	%		6.4	%		6.7	%		6.6	%		6.8	%
Consumer and other		0.9	%		0.9	%		0.8	%		0.8	%		0.7	%
Net deferred loan fees and costs		(0.1	%)		(0.1	%)		(0.1	%)		(0.1	%)		(0.1	%)
Total loans		100.0	%		100.0	%		100.0	%		100.0	%		100.0	%

FIRST BANK
QUARTERLY FINANCIAL HIGHLIGHTS
(dollars in thousands, unaudited)

	As of the Quarter Ended
	9/30/2024			6/30/2024			3/31/2024			12/31/2023			9/30/2023
DEPOSIT COMPOSITION
Non-interest bearing demand deposits	$	519,079		$	499,765		$	470,749		$	501,763		$	493,703
Interest bearing demand deposits		597,802			574,515			580,864			629,110			623,338
Money market and savings deposits		1,235,637			1,199,382			1,219,634			1,171,440			1,228,832
Time deposits		697,552			693,972			699,015			665,256			621,582
Total Deposits	$	3,050,070		$	2,967,634		$	2,970,262		$	2,967,569		$	2,967,455

DEPOSIT MIX
Non-interest bearing demand deposits		17.0	%		16.8	%		15.8	%		16.9	%		16.6	%
Interest bearing demand deposits		19.6	%		19.4	%		19.6	%		21.2	%		21.0	%
Money market and savings deposits		40.5	%		40.4	%		41.1	%		39.5	%		41.4	%
Time deposits		22.9	%		23.4	%		23.5	%		22.4	%		21.0	%
Total Deposits		100.0	%		100.0	%		100.0	%		100.0	%		100.0	%

FIRST BANK
NON-U.S. GAAP FINANCIAL MEASURES
(in thousands, except for share data, unaudited)

	As of or For the Quarter Ended
	9/30/2024			6/30/2024			3/31/2024			12/31/2023			9/30/2023
Return on Average Tangible Equity
Net income (numerator)	$	8,162		$	11,073		$	12,512		$	8,380		$	(1,271	)

Average stockholders' equity	$	398,535		$	386,644		$	376,542		$	366,950		$	353,372
Less: Average Goodwill and other intangible assets, net		53,823			54,347			54,790			55,324			49,491
Average Tangible stockholders' equity (denominator)	$	344,712		$	332,297		$	321,752		$	311,626		$	303,881

Return on Average Tangible equity (1)		9.42	%		13.40	%		15.64	%		10.67	%		-1.66	%

Tangible Book Value Per Share
Stockholders' equity	$	402,070		$	392,489		$	382,254		$	370,900		$	361,037
Less: Goodwill and other intangible assets, net		53,484			54,026			54,483			54,978			55,554
Tangible stockholders' equity (numerator)	$	348,586		$	338,463		$	327,771		$	315,922		$	305,483

Common shares outstanding (denominator)		25,186,920			25,144,983			25,096,449			24,968,122			24,926,919

Tangible book value per share	$	13.84		$	13.46		$	13.06		$	12.65		$	12.26

Tangible Equity / Tangible Assets
Stockholders' equity	$	402,070		$	392,489		$	382,254		$	370,900		$	361,037
Less: Goodwill and other intangible assets, net		53,484			54,026			54,483			54,978			55,554
Tangible stockholders' equity (numerator)	$	348,586		$	338,463		$	327,771		$	315,922		$	305,483

Total assets	$	3,757,653		$	3,615,731		$	3,591,398		$	3,609,327		$	3,558,426
Less: Goodwill and other intangible assets, net		53,484			54,026			54,483			54,978			55,554
Tangible total assets (denominator)	$	3,704,169		$	3,561,705		$	3,536,915		$	3,554,349		$	3,502,872

Tangible stockholders' equity / tangible assets		9.41	%		9.50	%		9.27	%		8.89	%		8.72	%

Efficiency Ratio
Non-interest expense	$	18,644		$	17,953		$	17,810		$	17,936		$	23,486
Less: Merger-related expenses		-			-			-			338			7,028
Adjusted non-interest expense (numerator)	$	18,644		$	17,953		$	17,810		$	17,598		$	16,458

Net interest income	$	30,094		$	30,540		$	30,318		$	30,999		$	28,594
Non-interest income		2,479			689			1,964			(3,000	)		193
Total revenue		32,573			31,229			32,282			27,999			28,787
Add: Losses on sale of investment securities, net		555			-			-			916			527
(Subtract) Add: (Gains) losses on sale of loans, net		(135	)		900			(229	)		3,799			704
Less: Bank Owned Life Insurance Enhancement		(1,116	)		-			-			-			-
Adjusted total revenue (denominator)	$	31,877		$	32,129		$	32,053		$	32,714		$	30,018

Efficiency ratio		58.49	%		55.88	%		55.56	%		53.79	%		54.83	%

(1) Annualized.

FIRST BANK
NON-U.S. GAAP FINANCIAL MEASURES
(dollars in thousands, except for share data, unaudited)

	For the Quarter Ended
	9/30/2024			6/30/2024			3/31/2024			12/31/2023			9/30/2023

Adjusted diluted earnings per share,
Adjusted return on average assets, and
Adjusted return on average equity

Net income	$	8,162		$	11,073		$	12,512		$	8,380		$	(1,271	)
Add: Merger-related expenses⁽¹⁾		-			-			-			267			5,552
Add: Credit loss expense on acquired loan portfolio⁽¹⁾		-			-			-			-			4,323
Add (subtract): Losses (gains) on sale of loans, net⁽¹⁾		(107	)		711			(181	)		3,001			556
Add: Losses on sale of investment securities, net⁽¹⁾		438			-			-			724			416
Add: Net Impact of Bank Owned Life Insurance Restructuring⁽²⁾		79			-			-			-			-
Adjusted net income	$	8,572		$	11,784		$	12,331		$	12,372		$	9,576

Diluted weighted average common shares outstanding		25,342,462			25,258,785			25,199,381			25,089,495			24,029,910
Average assets	$	3,672,843		$	3,618,912		$	3,575,748		$	3,561,261		$	3,565,350
Average equity	$	398,535		$	386,644		$	376,542		$	366,950		$	353,372
Average Tangible Equity	$	344,712		$	332,297		$	321,752		$	311,626		$	303,881

Adjusted diluted earnings per share	$	0.34		$	0.47		$	0.49		$	0.49		$	0.40
Adjusted return on average assets⁽³⁾		0.93	%		1.31	%		1.39	%		1.38	%		1.07	%
Adjusted return on average equity⁽³⁾		8.56	%		12.26	%		13.17	%		13.38	%		10.75	%
Adjusted return on average tangible equity⁽³⁾		9.89	%		14.26	%		15.41	%		15.75	%		12.50	%

(1) Items are tax-effected using a federal income tax rate of 21%.
(2) Includes the net impact of the new Bank Owned Life Insurance enhancement and the increased tax expense on the terminated policies.
(3) Annualized.

CONTACT: Andrew Hibshman, Chief Financial Officer

(609) 643-0058, andrew.hibshman@firstbanknj.com

First Bank Announces Third Quarter 2024 Net Income of $8.2 Million

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