Patriot National Bancorp Reports Strong First Quarter Results

STAMFORD, Conn., May 6, 2014 (GLOBE NEWSWIRE) -- Patriot National Bancorp, Inc. ("Patriot") (Nasdaq:PNBK) reported net income for the first quarter of 2014 of $319,000 or $0.01 per diluted share compared to a loss of $2 million or $0.05 per diluted share a year ago. First quarter results include a charge of $117,000 for prior period interest expense related to the company's Junior Subordinated Debentures. Excluding this prior period expense, net income would have been $436,000 and when annualized equates to a Return on Average Assets of 0.33% and a Return on Average Equity of 4.12%. Kenneth T. Neilson, President and CEO commented, "Patriot's first quarter results reflect improvements in all aspects of the company's operation including margin, other income, expense reduction, asset quality and new business generation. We are pleased with our results and look forward to continued improvement and growth."

Michael Carrazza, Chairman, stated, "Based on these results and Patriot's business plan for 2014, we believe Patriot, in the future, will no longer require a valuation allowance on its deferred tax assets which could add over $17 million to capital and will increase book value by approximately 45 cents per share."

Excluding the prior period expense, net interest income for the first quarter of 2014 was $4.1 million compared with $3.9 million in the first quarter of 2013 and Patriot's net interest margin was 3.35% for 2014 up from 2.73% in the first quarter of 2013.

Non interest income totaled $593,000 for the first quarter of 2014 up from $487,000 in the first quarter of last year, a 22% increase. The increases occurred across all categories of ongoing non interest income except for a slight decline on income from Bank Owned Life Insurance due to the interest rate environment.

Non interest expense for the first quarter of 2014 totaled $4.3 million down from $6.4 million in the first quarter of last year, a decrease of 33%. This decrease occurred in virtually every expense category as Patriot restructured itself to achieve efficiencies and provide better service.

At March 31, 2014 total assets were $562 million compared with $609 million a year ago. Net loans totaled $415 million at 3/31/14 compared with $462 million a year ago. Deposits were $428 million at 3/31/14 compared with $492 million last year. In connection with Patriot's turnaround, total assets were reduced to maintain capital requirements; with profitability achieved, Patriot is now growing its balance sheet.

Asset quality continues to improve with nonperforming assets totaling $10.4 million at 3/31/14, compared with $22.8 million a year ago. The provision for loan and lease losses stood at $5.5 million at 3/31/14 and $5.7 million at 3/31/13. The allowance now represents 1.30% of total loans and 53.9% of nonperforming loans. For the first quarter of 2014, the company had net charge-offs of $201,000 compared to $269,000 in the first quarter of 2013.

At March 31, 2014, stockholders' equity was $42.6 million and book value was $1.09 per share. Patriot's leverage capital ratio was 9.56% as of March 31, 2014. The Tier I Risk based capital ratio was 12.87% and the Total Risk based capital ratio was 14.12%. These regulatory capital ratios exceed those necessary to be considered a well-capitalized institution under Federal guidelines.

"Safe Harbor" Statement Under Private Securities Litigation Reform Act of 1995

Certain statements contained in Bancorp's public statements, including this one, may be forward looking and subject to a variety of risks and uncertainties. These factors include, but are not limited to, (1) changes in prevailing interest rates which would affect the interest earned on Bancorp's interest earning assets and the interest paid on its interest bearing liabilities, (2) the timing of repricing of Bancorp's interest earning assets and interest bearing liabilities, (3) the effect of changes in governmental monetary policy, (4) the effect of changes in regulations applicable to Bancorp and the Bank and the conduct of its business, (5) changes in competition among financial service companies, including possible further encroachment of non-banks on services traditionally provided by banks, (6) the ability of competitors that are larger than Bancorp to provide products and services which it is impracticable for Bancorp to provide, (7) the state of the economy and real estate values in Bancorp's market areas, and the consequent effect on the quality of Bancorp's loans, (8) recent governmental initiatives that are expected to have a profound effect on the financial services industry and could dramatically change the competitive environment of the Company, (9) other legislative or regulatory changes, including those related to residential mortgages, changes in accounting standards, and Federal Deposit Insurance Corporation ("FDIC") premiums that may adversely affect the Company, (10) the application of generally accepted accounting principles, consistently applied, (11) the fact that one period of reported results may not be indicative of future periods, (12) the state of the economy in the greater New York metropolitan area and its particular effect on the Company's customers, vendors and communities and other such factors, including risk factors, as may be described in Bancorp's other filings with the SEC.
PATRIOT NATIONAL BANCORP, INC.      
STATEMENTS OF OPERATIONS      
(Unaudited) Three Months Ended
Dollars in thousands, except per share data Mar. 31, 2014 Dec. 31, 2013 Mar. 31, 2013
       
Interest and dividend income      
Interest and fees on loans  $ 4,691  $ 5,037  $ 5,196
Interest on investment securities 135 156 248
Dividends on investment securities 41 26 29
Other interest income 12 11 28
Total interest and dividend income 4,879 5,230 5,501
       
Interest expense      
Interest on deposits 637 767 1,129
Interest on Federal Home Loan Bank borrowings 33 30 351
Interest on subordinated debt 200 71 71
Interest on other borrowings  --   --  76
Total interest expense 870 868 1,627
       
Net interest income 4,009 4,362 3,874
       
Provision for loan losses  --   --  (30)
       
Net interest income after provision for loan losses 4,009 4,362 3,904
       
Non-interest income      
Mortgage banking activity  --  (6) 46
Loan application, inspection and processing fees 66 41 38
Fees and service charges 219 185 171
Earnings on cash surrender value of life insurance 121 126 127
Other income 187 264 105
Total non-interest income 593 610 487
       
Non-interest expense      
Salaries and benefits 1,971 1,962 3,005
Occupancy and equipment expense 922 954 1,039
Data processing 250 436 371
Professional services and other outside services 471 436 889
Advertising and promotional expenses 51 60 42
Loan administration and processing expenses 17 28 77
Regulatory assessments 230 239 374
Insurance expense 97 64 79
Other real estate operations 16 121 2
Material and communications 93 95 106
Restructuring charges and asset disposals  --  (340)  -- 
Other operating expenses 165 285 385
Total non-interest expense 4,283 4,340 6,369
       
Income (loss) before income taxes 319 632 (1,978)
Benefit for income taxes  --   (318)  (21)
Net income (loss)  $ 319  $ 950  $ (1,957)
       
Basic and diluted income (loss) per share  $ 0.01  $ 0.02  $ (0.05)
       
PATRIOT NATIONAL BANCORP, INC.      
CONSOLIDATED BALANCE SHEETS      
(Unaudited)      
Dollars in thousands Mar. 31, 2014 Dec. 31, 2013 Mar. 31, 2013
       
Assets      
       
Noninterest bearing deposits and cash  $ 1,503  $ 1,570  $ 3,338
Interest bearing deposits 58,254 33,296 57,714
Short-term investments  --   --   711
Total cash and cash equivalents 59,757 34,866 61,763
       
Securities-available for sale 36,815 37,701 41,105
Other investments 4,450 4,450 3,500
FRB & FHLB stock 5,587 5,587 5,837
Total securities 46,852 47,738 50,442
       
Gross loans 420,603 423,829 468,210
Allowance for loan losses (5,480) (5,681) (5,717)
Net loans 415,123 418,148 462,493
       
Accrued interest and dividends receivable 1,578 1,566 1,886
Premises and equipment, net 14,866 15,061 4,327
Cash surrender value of life insurance 22,146 22,025 21,629
Other real estate owned  264  --  3,765
Deferred tax asset, net (1)  --   --   -- 
Other assets 1,902 1,844 2,538
Total Assets  $ 562,488  $ 541,248  $ 608,843
       
Liabilities and Shareholders' Equity      
       
Deposits      
Noninterest bearing deposits  $ 57,967  $ 55,358  $ 59,814
Interest bearing deposits 370,002 374,846 431,872
  427,969 430,204 491,686
       
FHLB advances and repurchase agreements 80,000 57,000 57,000
Subordinated debt 8,248 8,248 8,248
Accrued expenses and other liabilities 3,659 3,955 4,235
Total Liabilities 519,876 499,407 561,169
       
Common stock 391 388 385
Treasury stock (160) (160) (160)
Additional paid-in capital 105,540 105,484 105,363
Accumulated deficit (62,365) (62,684) (57,352)
Accumulated other comprehensive income (794) (1,187) (562)
Total Shareholders' Equity 42,612 41,841 47,674
       
Total Liabilities and Shareholders' Equity  $ 562,488  $ 541,248  $ 608,843
       
(1) Includes the deferred tax asset and a full valuation allowance of $17.9 million, $18.1 million and $15.8 million, respectively.
       
PATRIOT NATIONAL BANCORP, INC.      
FINANCIAL RATIOS AND OTHER DATA      
(Unaudited)      
Dollars in thousands, except per share data      
       
  Mar. 31, 2014 Dec. 31, 2013 Mar. 31, 2013
Asset Quality:      
Nonaccrual loans  $ 10,166  $ 12,308 $ 19,019
Other real estate owned  264  --   3,765
Total nonperforming assets  $ 10,430  $ 12,308  $ 22,784
       
       
Nonaccrual loans / loans 2.42% 2.90% 4.06%
Nonperforming assets / assets 1.85% 2.27% 3.74%
Allowance for loan losses  $ 5,480  $ 5,681  $ 5,717
Allowance for loan losses / loans 1.30% 1.34% 1.22%
Allowance / nonaccrual loans 53.91% 46.16% 30.06%
Gross loan charge-offs for the quarter  $ 217  $ 828  $ 306
Gross loan recoveries for the quarter  $ 16  $ 293  $ 37
Net loan charge-offs for the quarter  $ 201  $ 535  $ 269
       
       
Capital Data:      
Book value per share (1)  $ 1.09  $ 1.08  $ 1.24
Tangible book value per share (2)  $ 1.09  $ 1.08  $ 1.24
Shares outstanding  39,122,459  38,786,680  38,480,114
       
(1) Book value per share represents shareholders' equity divided by outstanding shares.      
(2) Tangible book value per share represents shareholders' equity less intangible assets divided by outstanding shares.  
CONTACT: Patriot National Bank         900 Bedford Street         Stamford, CT 06901                  Kenneth T. Neilson         President & CEO         203 252-5962                  Christina L. Maier         EVP & CFO         203 252-5901

Patriot National Bancorp, Inc. Logo

More from Press Releases

21st Century Fox Scoops Up Local News Stations

21st Century Fox Scoops Up Local News Stations

Walmart CEO: 'We Are Transforming Globally' With Flipkart

Walmart CEO: 'We Are Transforming Globally' With Flipkart

Three-Part FREE Webinar Series

Three-Part FREE Webinar Series

March 24 Full-Day Course Offering: Professional Approach to Trading SPX

March 24 Full-Day Course Offering: Professional Approach to Trading SPX

Meet the Real Money Pros: Market Strategies for 2012

Meet the Real Money Pros: Market Strategies for 2012