Equibles

8-K

PATRIOT NATIONAL BANCORP INC (PNBK)

8-K 2021-10-29 For: 2021-10-29
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Added on April 06, 2026

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_________________

FORM 8-K

_________________

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  October 29, 2021

_______________________________

PATRIOT NATIONAL BANCORP, INC.

(Exact name of registrant as specified in its charter)

_______________________________

Connecticut 000-29599 06-1559137
(State or Other Jurisdiction of Incorporation) (Commission File Number) (I.R.S. Employer Identification No.)

900 Bedford Street

Stamford, Connecticut 06901

(Address of Principal Executive Offices) (Zip Code)

(203) 252-5900

(Registrant's telephone number, including area code)

N/A

(Former name or former address, if changed since last report)

_______________________________

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Securities registered pursuant to Section 12(b) of the Act:

Title of each class Trading Symbol(s) Name of each exchange on which registered
Common Stock, par value $0.01 per share PNBK NASDAQ Global Market

Section 7 - Regulation FD

Item 7.01. Regulation FD Disclosure.

On October 29, 2021, Patriot National Bancorp, Inc. (the “Company”) issued a press release, a copy of which is attached hereto as Exhibit 99.1, regarding its earnings for the period ended September 30, 2021.

The information contained in this Current Report on Form 8-K (including the exhibit) is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as otherwise expressly stated in such filing.

Section 9 - Financial Statements and Exhibits

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No. Description
99.1 Press Release of Patriot National Bancorp, Inc., dated October 29, 2021
104 Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

PATRIOT NATIONAL BANCORP, INC.
Date: October 29, 2021 By: /s/ Joseph D. Perillo
Joseph D. Perillo
Executive Vice President and Chief Financial Officer

EdgarFiling EXHIBIT 99.1

Patriot Reports Third Quarter 2021 Net Income of $1.3 Million

STAMFORD, Conn., Oct. 29, 2021 (GLOBE NEWSWIRE) -- Patriot National Bancorp, Inc. (“Patriot,” “Bancorp” or the “Company”) (NASDAQ: PNBK), the parent company of Patriot Bank, N.A. (the “Bank”), today announced net income of $1.3 million, or $0.34 basic and diluted earnings per share for the quarter ended September 30, 2021, compared to a net loss of $87,000, or $0.02 basic and diluted loss per share reported in the third quarter of 2020. On a year-to-date basis, net income was $3.2 million, or $0.81 per fully diluted share, compared to a net loss of $2.4 million, or $0.62 fully diluted loss per share during the same year-to-date period in 2020.

The Bank continued to show improved net interest margins, core deposit growth, and lower operating expenses. The prepaid debit card program continues to be an increasing, low-cost funding source for the Bank and has grown substantially to $142.4 million as of September 30, 2021, from the $50.0 million acquired in July 2020. The portfolio growth provides a substantial improvement to the Bank’s net interest margin and overall funding costs.

During the three and nine months ended September 30, 2021, the Bank recognized payroll tax credits of $906,000 and $2.9 million, respectively, under the Employee Retention Credit program of the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”). Also, during the third quarter, the Bank recorded a credit to provision for loan losses of $300,000 due to overall improvement in asset quality.   Pre-tax income was $1.8 million and $4.4 million for the three and nine months ended September 30, 2021, respectively. Excluding the employee tax credit, pre-tax income was $896,000 and $1.5 million for the three- and nine-months periods, respectively.

Patriot President & CEO Robert Russell stated: “I am incredibly proud of the continued progress made over the past year. Improvement continues with respect to funding sources, asset quality and asset generation, all of which provide a positive impact on the Bank’s financials. The growth in our prepaid programs is a significant contributor to the reduction in the Bank’s funding costs over the last year. The Company has enhanced processes and added strategic talent to position for an effective future and we are very encouraged by the path we have forged.”

Since 2020, the Bank had provided payment deferrals on approximately $232.7 million of loans as permitted under the CARES Act. Virtually all of those loans deferred have now resumed normal payments. Only three loans remaining on deferral totaled $7.3 million at September 30, 2021.

Financial Results:

As of September 30, 2021, total assets increased to $952.3 million, as compared to $880.7 million at December 31, 2020, primarily due to increase in available-for-sale securities of $74.8 million. Net loans totaled $704.5 million versus $719.6 million as of December 31, 2020. Total deposits increased from $685.7 million at December 31, 2020, to $734.7 million at September 30, 2021.

The Bank has substantially improved its deposit and funding mix over the past year. During the past nine months, total deposits increased $49.0 million, primarily due to growth in prepaid deposits of $68.1 million, which was partially offset by decline of $27.3 million in brokered deposits and certificates of deposits. Excluding brokered deposits, total deposits increased 9.8% during the first nine months of 2021.

Net interest income was $6.3 million and $18.4 million for the three and nine months ended September 30, 2021, respectively. Net interest income for the three and nine months ended September 30, 2020, was $5.9 million and $17.9 million, respectively.

The Bank’s net interest margin showed strong improvement and was 2.87% for the nine months ended September 30, 2021, compared with 2.60% for the comparable 2020 period. As economic activity continues to expand, loan balances are expected to grow, and coupled with reductions in funding costs, the Bank expects further improvements in net interest income.

The recovering economy, lower loan balances and improvement in delinquencies of classified loans resulted in a $300,000 credit of provision for loan losses for the three and nine months ended September 30, 2021, as compared to a provision for loan losses of $85,000 and $1.8 million for the three and nine months ended September 30, 2020, respectively. The majority of the provision in 2020 was primarily attributable to conditions and the uncertainty created by the COVID-19 pandemic. As of September 30, 2021, the allowance for loan losses was 1.41% of total loans, compared with 1.45% at December 31, 2020.

Non-interest income was $923,000 and $2.1 million for the three and nine months ended September 30, 2021, respectively.   Non-interest income was $704,000 and $1.5 million for the three and nine months ended September 30, 2020, respectively. The increase in the current quarter was primarily attributable to a gain of $512,000 recognized from the termination of an interest rate swap cash flow hedge in the third quarter of 2021.

Non-interest expense was $5.7 million and $16.4 million for the three and nine months ended September 30, 2021, respectively. Non-interest expense was $6.6 million and $20.9 million for the three and nine months ended September 30, 2020, respectively. The decrease in non-interest expense in the nine months ended September 30, 2021, was primarily driven by an Employee Retention Credit of $2.9 million under the CARES Act and a reduction of $510,000 in regulatory assessments expense.

For the nine months ended September 30, 2021, a provision for income taxes of $1.2 million was recorded, compared to a benefit for income taxes of $811,000 for the nine months ended September 30, 2020.

As of September 30, 2021, shareholders’ equity was $66.7 million, compared with $63.2 million at December 31, 2020. Patriot’s book value per share rose to $16.89 at September 30, 2021, compared with $16.03 at December 31, 2020.

About the Company:

Patriot Bank is headquartered in Stamford and operates 9 branch locations: in Scarsdale, NY; and Darien, Fairfield, Greenwich, Milford, Norwalk, Orange, Stamford, Westport, CT with Express Banking locations at Bridgeport/ Housatonic Community College, downtown New Haven and Trumbull at Westfield Mall. The Bank also maintains SBA lending offices in Stamford, Connecticut, Florida, Georgia, Ohio, along with a Rhode Island operations center.

Founded in 1994, and now celebrating its 27th year, Patriot National Bancorp, Inc. (“Patriot” or “Bancorp”) is the parent holding company of Patriot Bank N.A. (“Bank”), a nationally chartered bank headquartered in Stamford, CT. Patriot operates with full-service branches in Connecticut and New York and provides lending products and services nationally. Patriot’s mission is to serve its local community and nationwide customer base by providing a growing array of banking solutions to meet the needs of individuals and small businesses owners. Patriot places great value in the integrity of its people and how it conducts business. An emphasis on building strong client relationships and community involvement are cornerstones of our philosophy as we seek to maximize shareholder value.

“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 the Company’s interest earning assets and the interest paid on its interest bearing liabilities; (2) the timing of re-pricing of the Company’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 the Company 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 the Company to provide products and services which it is impracticable for the Company to provide; (7) the state of the economy and real estate values in the Company’s market areas, and the consequent effect on the quality of the Company’s loans; (8) demand for loans and deposits in our market area; (9) 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; (10) 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; (11) the application of generally accepted accounting principles, consistently applied; (12) the fact that one period of reported results may not be indicative of future periods; (13) 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 the Company’s other filings with the Securities and Exchange Commission (the “SEC”); (14) political, social, legal and economic instability, civil unrest, war, catastrophic events, acts of terrorism; (15) widespread outbreaks of infectious diseases, including the ongoing novel coronavirus (COVID-19) outbreak; (16) changes in the level and direction of loan delinquencies and write-offs and changes in estimates of the adequacy of the allowance for loan losses; (17) our ability to access cost-effective funding; (18) our ability to implement and change our business strategies; (19) changes in the quality or composition of our loan or investment portfolios; (20) technological changes that may be more difficult or expensive than expected; (21) our ability to manage market risk, credit risk and operational risk in the current economic environment; (22) our ability to enter new markets successfully and capitalize on growth opportunities; (23) changes in consumer spending, borrowing and savings habits; (24) our ability to retain key employees; and (25) our compensation expense associated with equity allocated or awarded to our employees.

PATRIOT NATIONAL BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (Unaudited)
(In thousands) September 30, 2021 December 31, 2020 September 30, 2020
Assets
Cash and due from banks:
Noninterest bearing deposits and cash $ 5,298 $ 3,006 $ 3,231
Interest bearing deposits 40,967 31,630 46,405
Total cash and cash equivalents 46,265 34,636 49,636
Investment securities:
Available-for-sale securities, at fair value 124,103 49,262 47,823
Other investments, at cost 4,450 4,450 4,450
Total investment securities 128,553 53,712 52,273
Federal Reserve Bank stock, at cost 2,843 2,783 2,783
Federal Home Loan Bank stock, at cost 5,009 4,503 4,503
Gross loans receivable 714,538 730,180 751,298
Allowance for loan losses (10,079 ) (10,584 ) (11,171 )
Net loans receivable 704,459 719,596 740,127
SBA loans held for sale 4,128 1,217 6,824
Accrued interest and dividends receivable 6,186 6,620 6,834
Premises and equipment, net 32,638 33,423 33,632
Other real estate owned - 1,906 1,954
Deferred tax asset, net 10,352 11,496 12,066
Goodwill 1,107 1,107 1,107
Core deposit intangible, net 308 343 567
Other assets 10,498 9,387 10,623
Total assets $ 952,346 $ 880,729 $ 922,929
Liabilities
Deposits:
Noninterest bearing deposits $ 207,941 $ 158,676 $ 161,871
Interest bearing deposits 526,732 526,980 565,560
Total deposits 734,673 685,656 727,431
Federal Home Loan Bank and correspondent bank borrowings 110,000 90,000 90,000
Senior notes, net 11,983 11,927 11,909
Subordinated debt, net 9,803 9,782 9,774
Junior subordinated debt owed to unconsolidated trust, net 8,116 8,110 8,108
Note payable 842 994 1,044
Advances from borrowers for taxes and insurance 2,253 3,786 2,492
Accrued expenses and other liabilities 7,976 7,255 7,634
Total liabilities 885,646 817,510 858,392
Commitments and Contingencies - - -
Shareholders' equity
Preferred stock - - -
Common stock 106,439 106,329 106,293
Accumulated deficit (39,393 ) (42,592 ) (41,210 )
Accumulated other comprehensive loss (346 ) (518 ) (546 )
Total shareholders' equity 66,700 63,219 64,537
Total liabilities and shareholders' equity $ 952,346 $ 880,729 $ 922,929
PATRIOT NATIONAL BANCORP, INC. AND SUBSIDIARIES
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
Three Months Ended Nine Months Ended
(In thousands, except per share amounts) September 30, 2021 June 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020
Interest and Dividend Income
Interest and fees on loans $ 7,189 $ 7,267 $ 8,578 $ 22,199 $ 27,722
Interest on investment securities 692 420 340 1,422 1,134
Dividends on investment securities 59 57 85 150 313
Other interest income 20 23 28 67 187
Total interest and dividend income 7,960 7,767 9,031 23,838 29,356
Interest Expense
Interest on deposits 448 623 2,028 1,856 8,020
Interest on Federal Home Loan Bank borrowings 756 741 628 2,230 1,963
Interest on senior debt 229 228 229 686 686
Interest on subordinated debt 233 233 235 700 756
Interest on note payable and other 4 4 5 12 15
Total interest expense 1,670 1,829 3,125 5,484 11,440
Net interest income 6,290 5,938 5,906 18,354 17,916
(Credit) provision for loan losses (300 ) - 85 (300 ) 1,799
Net interest income after (credit) provision for loan losses 6,590 5,938 5,821 18,654 16,117
Non-interest Income
Loan application, inspection and processing fees 79 61 54 203 147
Deposit fees and service charges 61 64 73 190 253
Gains on sale of loans - 258 380 352 464
Rental income 130 140 131 400 393
Gain on sale of investment securities 26 93 - 119 -
Other income 627 137 66 854 257
Total non-interest income 923 753 704 2,118 1,514
Non-interest Expense
Salaries and benefits 2,843 2,447 3,460 7,506 10,966
Occupancy and equipment expenses 832 778 810 2,530 2,680
Data processing expenses 376 362 433 1,088 1,194
Professional and other outside services 633 714 627 2,199 2,137
Project expenses, net 4 1 6 15 154
Advertising and promotional expenses 57 77 107 196 377
Loan administration and processing expenses 23 14 75 61 135
Regulatory assessments 213 208 355 649 1,159
Insurance expenses 79 75 67 214 215
Communications, stationary and supplies 161 144 118 450 371
Other operating expenses 490 466 560 1,484 1,491
Total non-interest expense 5,711 5,286 6,618 16,392 20,879
Income (loss) before income taxes 1,802 1,405 (93 ) 4,380 (3,248 )
Provision (benefit) for income taxes 479 383 (6 ) 1,181 (811 )
Net income (loss) $ 1,323 $ 1,022 $ (87 ) $ 3,199 $ (2,437 )
Basic earnings (loss) per share $ 0.34 $ 0.26 $ (0.02 ) $ 0.81 $ (0.62 )
Diluted earnings (loss) per share $ 0.34 $ 0.26 $ (0.02 ) $ 0.81 $ (0.62 )
FINANCIAL RATIOS AND OTHER DATA
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Three Months Ended Nine Months Ended
(Dollars in thousands) September 30, 2021 June 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020
Performance Data:
$ 1,323 $ 1,022 $ (87 ) $ 3,199 $ (2,437 )
0.56 % 0.46 % -0.04 % 0.47 % -0.33 %
7.86 % 6.35 % -0.53 % 6.56 % -4.94 %
2.82 % 2.82 % 2.61 % 2.87 % 2.60 %
79.20 % 78.99 % 100.12 % 80.07 % 107.46 %
6.51 % -0.85 % -5.20 % -2.14 % -7.49 %
-5.44 % 10.96 % 2.29 % 9.82 % 17.94 %
Asset Quality:
$ 28,046 $ 24,524 $ 20,440 $ 28,046 $ 20,440
$ - $ 1,216 $ 1,954 $ - $ 1,954
$ 28,046 $ 25,740 $ 22,394 $ 28,046 $ 22,394
3.93 % 3.66 % 2.72 % 3.93 % 2.72 %
2.94 % 2.67 % 2.43 % 2.94 % 2.43 %
$ 10,079 $ 10,362 $ 11,171 $ 10,079 $ 11,171
$ 466 $ 469 $ 492 $ 466 $ 492
$ 10,545 $ 10,831 $ 11,663 $ 10,545 $ 11,663
1.41 % 1.54 % 1.49 % 1.41 % 1.49 %
35.94 % 42.25 % 54.65 % 35.94 % 54.65 %
1.47 % 1.61 % 1.55 % 1.47 % 1.55 %
37.60 % 44.16 % 57.06 % 37.60 % 57.06 %
$ 6 $ 80 $ 75 $ 358 $ 810
$ (23 ) $ (16 ) $ (13 ) $ (153 ) $ (67 )
$ (17 ) $ 64 $ 62 $ 205 $ 743
Per Share Data and Capital Ratio
$ 16.89 $ 16.69 $ 16.39 $ 16.89 $ 16.39
$ 16.54 $ 16.32 $ 15.97 $ 16.54 $ 15.97
$ 16.41 $ 16.18 $ 15.86 $ 16.41 $ 15.86
3,947,976 3,947,276 3,937,041 3,947,976 3,937,041
9.88 % 10.10 % 9.35 % 9.88 % 9.35 %
(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.
Deposits:
September 30, 2021 June 30, 2021 December 31, 2020 September 30, 2020
Non-interest bearing:
Non-interest bearing $ 114,850 $ 135,477 $ 99,344 $ 102,004
Prepaid DDA 93,091 82,897 59,332 59,867
207,941 218,374 158,676 161,871
Interest bearing:
NOW 34,528 36,085 30,529 29,518
Savings 102,365 99,264 98,635 91,169
Money market 116,318 123,327 131,378 142,906
Money market - prepaid deposits 49,353 54,922 15,011 3
Certificates of deposit, less than 250,000 142,141 152,700 160,968 160,610
Certificates of deposit, 250,000 or greater 54,991 63,690 49,172 50,359
Brokered deposits 27,036 12,836 41,287 90,995
526,732 542,824 526,980 565,560
$ 734,673 $ 761,198 $ 685,656 $ 727,431
$ 142,444 $ 137,819 $ 74,343 $ 59,870
Total deposits excluding brokered deposits $ 707,637 $ 748,362 $ 644,369 $ 636,436

All values are in US Dollars.

Contacts:
Patriot Bank, N.A. Joseph Perillo Robert Russell
900 Bedford Street Chief Financial Officer President & CEO
Stamford, CT 06901 203-252-5954 203-252-5939
www.BankPatriot.com

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