CHARLES TOWN, W.Va., Feb. 1, 2024 /PRNewswire/ -- Potomac Bancshares, Inc. (the "Company") (OTC: PTBS), the one bank holding company for Bank of Charles Town (BCT), for the quarter ended December 31, 2023, earned $1.710 million or $0.41 per share compared to $1.953 million or $0.47 per share for the quarter ended December 31, 2022, and $1.729 million in the third quarter of 2023 or $0.42 per share.
Net income was $7.264 million for the full year 2023 or $1.75 per share compared to $7.311 million or $1.77 per share in 2022. The full year was impacted by the pre-tax loss on sales of securities in the third and fourth quarters totaling $428 thousand. Excluding these losses, net income for 2023 would have been $7.596 million, or $1.83 per share.
Net income was $7.311 million for the full year 2022 or $1.77 per share. Excluding the $367 thousand pre-tax loss on sales of securities in the fourth quarter of 2022, net income for the full year 2022 would have been $7.598 million, or $1.83 per share.
Alice P. Frazier, CEO and President, commented, "As we conclude another successful year, it is important to thank the entire BCT team for their intentional efforts toward building new and expanding client relationships that led to our consistent financial results. Our core deposits grew a remarkable 11.2% year over year as we managed the overall increase in the cost of deposits. Despite a movement of deposits to interest bearing products, we were able to maintain our non-interest deposit balances level with the prior year. Our loan pipelines are growing as we remain prudent on our credit spectrum. It is exciting to have BCT Wealth and Investments complete a particularly strong year with a 15% increase in fee income due to new relationships and estate settlements."
Frazier continued, "We strategically expanded our commercial banking expertise by adding government contractor banking. In the fourth quarter, we hired a Director of Government Lending to build this unit and expand our government lending strategy. Looking forward, we see continued upward pressure on deposit pricing. However, we will continue to utilize our relationship pricing model which has served us well in managing the costs."
Selected Highlights
Q4 2023 Compared to Q4 2022
Linked Quarter Q4 2023 Compared to Q3 2023
Dividend Announcement
At our January Board meeting, Potomac Bancshares, Inc. Board of Directors declared a quarterly dividend of $0.10 per share. The dividend is for all shareholders of record on February 2, 2024, and will be paid on February 9, 2024.
About the Company
Founded in 1871, BCT - Bank of Charles Town, also known as The Community's Bank, is a wholly owned subsidiary of Potomac Bancshares, Inc. (OTC:PTBS). The Company conducts operations through its main office, an additional eight branch offices, and two loan production offices. BCT's offices are in Jefferson and Berkeley Counties (WV), Washington County (MD), and Loudoun and Stafford Counties (VA). The Bank provides various banking products and services including free access to over 55,000 ATMs through the Allpoint® network plus online and mobile banking for individuals, businesses, and local governments. The Bank also offers commercial lines and term loans, residential and commercial construction loans, commercial real estate loans, agricultural loans, and government contractor loans. The Residential Lending division offers secondary market and portfolio mortgage loans, one-time close construction to perm loans, as well as home equity loans and lines of credit. For over 65 years, BCT Wealth Advisors has provided financial management, investment, trust, and estate services to its clients. In 2023, American Banker selected BCT as a "Top 200 Community Bank," an annual listing of the best performing banks in the United States with assets under $2 billion. BCT was voted a "Best of the Best" winner in the 2023 Journal-News Readers' Choice Awards in four categories: Bank, Mortgage Company, Loan Services, and Financial Planning. In 2023, 2021, 2020, and 2019 the Bank was named a "Best Bank To Work For" by American Banker.
The Company's shares are quoted on the OTC Pink Sheet marketplace under the symbol "PTBS." For more information about Potomac Bancshares, Inc., and the Bank, please visit our website at www.mybct.bank.
Forward Looking Statements
Certain statements made in this press release may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that include projections, predictions, expectations, or beliefs about events or results or otherwise are not statements of historical facts, such as statements about the Company's growth strategy and deployment of capital. Although the Company believes that its expectations with respect to such forward-looking statements are based upon reasonable assumptions within the bounds of its existing knowledge of its business and operations, there can be no assurance that actual results, performance, or achievements of the Company will not differ materially from those expressed or implied by such forward-looking statements. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether because of new information, future events or otherwise, except as required by applicable law.
CONSOLIDATED FINANCIAL HIGHLIGHTS | ||||||
POTOMAC BANCSHARES, INC. | ||||||
TABLE 1 | ||||||
Twelve Months Ended | ||||||
(Unaudited - dollars in thousands, except per share data) | ||||||
December 31, 2023 | December 31, 2022 | |||||
Earnings Performance | ||||||
Interest and dividend income | $35,583 | $27,064 | ||||
Interest expense | 9,567 | 2,791 | ||||
Net interest income | 26,016 | 24,273 | ||||
Provision for credit losses | 222 | 632 | ||||
Non-interest income | 6,299 | 6,083 | ||||
Non-interest expense | 22,740 | ** | 20,334 | ** | ||
Income Before Income Tax Expense | 9,353 | 9,390 | ||||
Income tax expense | 2,089 | 2,079 | ||||
Net Income | $7,264 | $7,311 | ||||
Return on average equity | 11.59 % | 12.35 % | ||||
Return on average assets | 0.91 % | 0.99 % | ||||
Net interest margin | 3.34 % | 3.38 % | ||||
December 31, 2023 | December 31, 2022 | |||||
Balance Sheet Highlights | ||||||
Total assets | $830,555 | $756,050 | ||||
Investment securities | 84,127 | 88,743 | ||||
Loans held for sale | 678 | - | ||||
Loans, net of allowance for credit losses of $6,673 in 2023 and $6,202 in 2022 | 644,687 | 616,382 | ||||
Deposits | 739,680 | 665,469 | ||||
Long term FHLB borrowings | 6,000 | - | ||||
Subordinated debt, net of issuance costs | 9,897 | 9,839 | ||||
Shareholders' equity | $66,874 | $60,460 | ||||
December 31, 2023 | December 31, 2022 | |||||
Shareholders' Value (per share) | ||||||
Earnings per share, basic | $1.75 | $1.77 | ||||
Earnings per share, diluted | 1.75 | 1.77 | ||||
Cash dividends declared (per share) | 0.38 | 0.35 | ||||
Book value at period end (per share) | $16.14 | $14.59 | ||||
End of period number of shares outstanding | 4,144,561 | 4,144,561 | ||||
December 31, 2023 | December 31, 2022 | |||||
Safety and Soundness | ||||||
Tier 1 capital ratio (leverage ratio)* | 9.77 % | 10.08 % | ||||
Tangible Equity/Tangible Assets | 8.05 % | 8.00 % | ||||
Non-performing assets as a percentage of | ||||||
total assets including OREO | 0.32 % | 0.00 % | ||||
Allowance for credit losses as a percentage of | ||||||
period end loans | 1.02 % | 1.00 % | ||||
Ratio of net charge offs (recoveries) during the period to | ||||||
average loans outstanding during the period | 0.008 % | -0.011 % | ||||
* The capital ratio presented is for Bank of Charles Town. When computing capital ratios, the net of unrealized holding gains (losses) on securities available for sale and the unfunded liability for pension and other post-retirement benefits, all computed net of tax, are added back to these shareholders' equity figures. | ||||||
** Includes $428 thousand pre tax loss on sales of securities in 2023 and $367 thousand pre tax loss in 2022. |
CONSOLIDATED FINANCIAL HIGHLIGHTS | ||||||||||||
POTOMAC BANCSHARES, INC. | ||||||||||||
TABLE 2 | Quarterly Financial Data | |||||||||||
Three Months Ended | ||||||||||||
(Unaudited - dollars in thousands, except per share data) | ||||||||||||
12/31/2023 | 9/30/2023 | 6/30/2023 | 3/31/2023 | 12/31/2022 | ||||||||
Earnings Performance | ||||||||||||
Interest and dividend income | $9,827 | $9,176 | $8,548 | $8,032 | $7,789 | |||||||
Interest expense | 3,034 | 2,752 | 2,272 | 1,509 | 987 | |||||||
Net interest income | 6,793 | 6,424 | 6,276 | 6,523 | 6,802 | |||||||
Provision for credit losses | - | - | 191 | 31 | 165 | |||||||
Non-interest income | 1,662 | 1,633 | 1,667 | 1,337 | 1,419 | |||||||
Non-interest expense | 6,266 | ** | 5,821 | *** | 5,467 | 5,186 | 5,553 | **** | ||||
Income Before Income Tax Expense | 2,189 | 2,236 | 2,285 | 2,643 | 2,503 | |||||||
Income tax expense | 479 | 507 | 502 | 601 | 550 | |||||||
Net Income | $1,710 | $1,729 | $1,783 | $2,042 | $1,953 | |||||||
Return on average equity | 11.21 % | 11.86 % | 11.41 % | 13.52 % | 14.74 % | |||||||
Return on average assets | 0.85 % | 0.93 % | 0.91 % | 1.09 % | 1.13 % | |||||||
Net interest margin | 3.29 % | 3.23 % | 3.28 % | 3.57 % | 3.63 % | |||||||
12/31/2023 | 9/30/2023 | 6/30/2023 | 3/31/2023 | 12/31/2022 | ||||||||
Balance Sheet Highlights | ||||||||||||
Total assets | $830,555 | $809,607 | $794,015 | $792,332 | $756,050 | |||||||
Investment securities | 84,127 | 82,575 | 85,350 | 88,605 | 88,743 | |||||||
Loans held for sale | 678 | 2,159 | 2,086 | 292 | - | |||||||
Loans, net of allowance for credit losses | 644,687 | 643,921 | 638,381 | 620,436 | 616,382 | |||||||
Deposits | 739,680 | 721,253 | 706,660 | 704,717 | 665,469 | |||||||
Long term FHLB borrowings | 6,000 | 6,000 | 6,000 | 6,000 | - | |||||||
Short term overnight borrowings | - | - | - | - | 11,720 | |||||||
Subordinated debt, net of issuance costs | 9,897 | 9,882 | 9,868 | 9,854 | 9,839 | |||||||
Shareholders' equity | 66,874 | $62,770 | $62,441 | $62,416 | $60,460 | |||||||
12/31/2023 | 9/30/2023 | 6/30/2023 | 3/31/2023 | 12/31/2022 | ||||||||
Shareholders' Value (per share) | ||||||||||||
Earnings per share, basic | $0.41 | $0.42 | $0.43 | $0.49 | $0.47 | |||||||
Earnings per share, diluted | 0.41 | 0.42 | 0.43 | 0.49 | 0.47 | |||||||
Cash dividends declared (per share) | 0.10 | 0.10 | 0.09 | 0.09 | 0.09 | |||||||
Book value at period end (per share) | $16.14 | $15.15 | $15.07 | $15.06 | $14.59 | |||||||
End of period number of shares outstanding | 4,144,561 | 4,144,561 | 4,144,561 | 4,144,561 | 4,144,561 | |||||||
12/31/2023 | 9/30/2023 | 6/30/2023 | 3/31/2023 | 12/31/2022 | ||||||||
Safety and Soundness | ||||||||||||
Tier 1 capital ratio (leverage ratio)* | 9.77 % | 9.93 % | 10.04 % | 10.25 % | 10.08 % | |||||||
Tangible Equity/Tangible Assets | 8.05 % | 7.75 % | 7.86 % | 7.88 % | 8.00 % | |||||||
Non-performing assets as a percentage of | ||||||||||||
total assets including OREO | 0.32 % | 0.33 % | 0.33 % | 0.00 % | 0.00 % | |||||||
Allowance for credit losses as a percentage of | ||||||||||||
period end loans | 1.02 % | 1.04 % | 1.05 % | 1.05 % | 1.00 % | |||||||
Ratio of net charge offs (recoveries) annualized during the period to | ||||||||||||
average loans outstanding during the period | 0.008 % | 0.004 % | -0.011 % | -0.009 % | -0.008 % | |||||||
* The capital ratio presented is for Bank of Charles Town. When computing capital ratios, the net of unrealized holding gains (losses) on securities available for sale and the unfunded liability for pension and other post-retirement benefits, all computed net of tax, are added back to these shareholders' equity figures. | ||||||||||||
** Includes $154 thousand pre tax loss on sale of securities. | ||||||||||||
*** Includes $274 thousand pre tax loss on sale of securities. | ||||||||||||
**** Includes $367 thousand pre tax loss on sale of securities. |
CONSOLIDATED FINANCIAL HIGHLIGHTS | |||||||||||
POTOMAC BANCSHARES, INC. | |||||||||||
Noninterest Income & Noninterest Expense | |||||||||||
TABLE 3 | Three Months Ended | ||||||||||
(Unaudited - dollars in thousands) | |||||||||||
12/31/2023 | 9/30/2023 | 6/30/2023 | 3/31/2023 | 12/31/2022 | |||||||
Noninterest Income: | |||||||||||
Wealth and Investments | $471 | $453 | $425 | $390 | $344 | ||||||
Service charges on deposit accounts | 254 | 266 | 266 | 230 | 268 | ||||||
Secondary market income | 140 | 223 | 232 | 82 | 92 | ||||||
Interchange fees | 506 | 515 | 523 | 484 | 511 | ||||||
Other operating income | 291 | 176 | 221 | 151 | 204 | ||||||
Total Noninterest Income | $1,662 | $1,633 | $1,667 | $1,337 | $1,419 | ||||||
Noninterest Expenses: | |||||||||||
Salaries and employee benefits | 3,348 | $3,083 | $3,061 | $2,863 | $2,823 | ||||||
Net occupancy expense of premises | 256 | 261 | 254 | 259 | 260 | ||||||
Furniture and equipment expenses | 341 | 349 | 369 | 334 | 342 | ||||||
Advertising and public relations | 92 | 105 | 133 | 66 | 76 | ||||||
Computer services and communications | 485 | 486 | 454 | 409 | 457 | ||||||
Other professional services | 410 | 329 | 258 | 289 | 312 | ||||||
ATM and check card expenses | 258 | 243 | 275 | 227 | 222 | ||||||
Loss on sale of AFS securities | 154 | 274 | - | - | 367 | ||||||
Other operating expenses | 922 | 691 | 663 | 739 | 694 | ||||||
Total Noninterest Expenses | $6,266 | $5,821 | $5,467 | $5,186 | $5,553 |
CONSOLIDATED FINANCIAL HIGHLIGHTS | ||||||||||||
POTOMAC BANCSHARES, INC. | ||||||||||||
AVERAGE BALANCE SHEET, INTEREST AND RATES | ||||||||||||
TABLE 4 | ||||||||||||
Three Months Ended | Three Months Ended | Three Months Ended | ||||||||||
(Unaudited - dollars in thousands) | 12/31/2023 | 9/30/2023 | 12/31/2022 | |||||||||
ASSETS: | Average | Interest | Average | Average | Interest | Average | Average | Interest | Average | |||
Interest Earning Assets: | ||||||||||||
Loans: | ||||||||||||
Loans held for sale | $ 1,327 | $ 22 | 6.58 % | $ 1,856 | $ 30 | 6.41 % | $ 550 | $ 8 | 5.77 % | |||
Portfolio loans (1) | 650,485 | 8,205 | 5.00 % | 648,910 | 8,063 | 4.93 % | 611,564 | 7,012 | 4.55 % | |||
Available for sale securities (2) | 93,172 | 638 | 2.72 % | 94,677 | 545 | 2.28 % | 106,843 | 566 | 2.10 % | |||
Federal Reserve | 71,448 | 920 | 5.11 % | 40,476 | 498 | 4.88 % | 23,237 | 179 | 3.06 % | |||
Other interest earning assets | 2,438 | 42 | 6.83 % | 2,311 | 40 | 6.87 % | 1,886 | 24 | 5.05 % | |||
Total Interest Earning Assets | 818,870 | $ 9,827 | 4.76 % | 788,230 | $ 9,176 | 4.62 % | 744,080 | $ 7,789 | 4.15 % | |||
Other Assets | 16,866 | 17,485 | 15,945 | |||||||||
Total Assets | $ 835,736 | $ 805,715 | $ 760,025 | |||||||||
Liabilities and Stockholders' Equity | ||||||||||||
Interest-bearing liabilities: | ||||||||||||
Interest-bearing Deposits | $ 585,485 | $ 2,819 | 1.91 % | $ 550,424 | $ 2,535 | 1.83 % | $ 517,256 | $ 824 | 0.63 % | |||
Federal Funds and repurchase agreements | 3,791 | 8 | 0.84 % | 5,232 | 10 | 0.76 % | 3,893 | 6 | 0.61 % | |||
Subordinated debt | 9,887 | 139 | 5.58 % | 9,873 | 139 | 5.59 % | 9,831 | 139 | 5.61 % | |||
FHLB advances | 6,000 | 68 | 4.50 % | 6,011 | 68 | 4.49 % | 1,650 | 18 | 4.33 % | |||
Total Interest-Bearing Liabilities | 605,163 | $ 3,034 | 1.99 % | 571,540 | $ 2,752 | 1.91 % | 532,630 | $ 987 | 0.74 % | |||
Non-interest-bearing deposits and other liabilities | 166,910 | 171,033 | 169,068 | |||||||||
Total Liabilities | 772,073 | 742,573 | 701,698 | |||||||||
Stockholders' Equity | 63,663 | 63,142 | 58,327 | |||||||||
Total Liabilities and Stockholders' Equity | $ 835,736 | $ 805,715 | $ 760,025 | |||||||||
Interest Rate Spread | 2.77 % | 2.71 % | 3.41 % | |||||||||
Net Interest Income | $ 6,793 | $ 6,424 | $ 6,802 | |||||||||
Net Interest Margin | 3.29 % | 3.23 % | 3.63 % | |||||||||
(1) Total loan interest income includes amortization of deferred loan fees, net of deferred loan costs. | ||||||||||||
(2) Average balances exclude unrealized gains/losses. |
SOURCE Potomac Bancshares, Inc.
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