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Blue Foundry Bancorp Reports Fourth Quarter and Year-End 2022 Results

Globe Newswire 25-Jan-2023 8:15 AM

RUTHERFORD, N. J. , Jan. 25, 2023 (GLOBE NEWSWIRE) -- Blue Foundry Bancorp (NASDAQ:BLFY) (the "Company"), the holding company for Blue Foundry Bank (the "Bank"), today reported net income of $2.4 million, or $0.09 per diluted common share, for the year ended December 31, 2022 compared to a net loss of $36.3 million for the year ended December 31, 2021.

Net income was $562 thousand, or $0.02 per diluted common share, for the three months ended December 31, 2022 compared to $1.2 million, or $0.05 per diluted common share, for the three months ended September 30, 2022, and a net loss of $19.6 million, or $(0.75) per diluted common share, for the three months ended December 31, 2021.

James D. Nesci, President and Chief Executive Officer, commented, "Our fourth quarter was highlighted by continued strong loan growth. In 2022, consistently robust and diverse loan production drove a 20% increase in gross loans. Additionally, the Company's focus on attracting customers to our suite of consumer-friendly deposit products led to a 13% annual increase in core deposits."

He continued, "While today's economic environment remains difficult, we are steadfast in executing on our strategic priorities. We are also committed to the underwriting standards that have resulted in consistently strong asset quality, and both our bank and holding company remain well capitalized."

Highlights for the fourth quarter of 2022:

  • Gross loans grew by $51.3 million, or 3.4%, compared to the linked quarter, led by growth in commercial portfolios.
  • Loan originations totaled $68.2 million for the quarter, and included originations of $35.4 million in non-residential loans, and $24.2 million in multifamily loans.
  • Total deposits increased $22.4 million, or 1.8%, compared to the linked quarter, driven by growth in time deposits.
  • Non-interest expense, excluding the provision for commitments and letters of credit, decreased $427 thousand, or 3.2%, compared to the linked quarter.
  • Net interest income for the quarter was $12.9 million, a decrease of $888 thousand, or 6.4%, compared to the prior quarter, and an increase of $590 thousand, or 4.8%, compared to the prior year quarter.
  • Net interest margin was 2.62%, a 22 basis point decrease compared to the linked quarter and a one basis point decrease from the prior year quarter.
  • The Company recorded a release of provision for loan losses of $224 thousand and a release of provision for commitments and letters of credit of $203 thousand.
  • During the quarter, 632,073 shares were repurchased at a weighted average cost of $12.40. 1,298,762 shares have been repurchased as of December 31, 2022, representing 46% of the stock authorized for repurchase under the Company's initial stock repurchase program announced in July 2022.
  • Tangible book value per share increased 19 cents to $14.28.

Lending Franchise

The Company continues to diversify its lending franchise by focusing on growing the commercial portfolio. During the fourth quarter of 2022, gross loans increased by $51.3 million primarily due to strong growth within the Company's non-residential and multifamily portfolios.

The details of the loan portfolio are below:

 December 31,
2022
 September 30,
2022
 June 30,
2022
 March 31,
2022
 December 31,
2021
          
 (In thousands)  
Residential one-to-four family$594,521  $591,728  $590,151  $579,083  $560,976 
Multifamily 690,278   679,474   579,183   517,037   515,240 
Non-residential real estate 216,394   185,450   211,683   187,310   141,561 
Construction and land 17,990   12,981   21,010   18,613   23,419 
Junior liens 18,477   16,653   16,421   18,071   18,464 
Commercial and industrial (including PPP) 4,682   4,738   5,957   16,201   21,563 
Consumer and other 38   39   47   37   87 
Total gross loans 1,542,380   1,491,063   1,424,452   1,336,352   1,281,310 
Deferred fees, costs, premiums and discounts, net 2,747   3,374   3,821   5,134   6,299 
Total loans 1,545,127   1,494,437   1,428,273   1,341,486   1,287,609 
Allowance for loan losses (13,400)  (13,600)  (14,050)  (13,465)  (14,425)
Loans receivable, net$1,531,727  $1,480,837  $1,414,223  $1,328,021  $1,273,184 

The commercial and industrial portfolio includes Paycheck Protection Program (PPP) loans, net of deferred fees, which totaled $477 thousand at December 31, 2022, $557 thousand at September 30, 2022, $2.0 million at June 30, 2022, $8.1 million at March 31, 2022, and $16.8 million at December 31, 2021.

Retail Banking Franchise

As of December 31, 2022, core deposits totaled $872.6 million, an increase of $99.4 million or 12.8% from December 31, 2021. The Company remains focused on attracting the full banking relationship of small- to medium-sized businesses through an extensive suite of deposit products.

The details of deposits are below:

 December 31,
2022
 September 30,
2022
 June 30,
2022
 March 31,
2022
 December 31,
2021
          
 (In thousands)  
Non-interest bearing deposits$49,514 $59,636 $52,036 $45,143 $44,894
NOW and demand accounts 399,330  385,334  455,776  425,766  363,419
Savings 423,758  455,979  358,166  367,177  364,932
Core deposits 872,602  900,949  865,978  838,086  773,245
          
Time deposits 416,260  365,548  430,696  444,936  473,795
Total deposits$1,288,862 $1,266,497 $1,296,674 $1,283,022 $1,247,040


Financial Performance Overview:
        

Fourth quarter of 2022 compared to the fourth quarter of 2021

Net interest income compared to the fourth quarter of 2021:

  • Net interest income was $12.9 million, an increase of $590 thousand.
  • Net interest margin decreased one basis point to 2.62%.
  • Yield on average interest-earning assets increased 52 basis points to 3.55%.
  • Cost of average interest-bearing deposits increased 48 basis points to 0.82%, reflecting the competitive rate environment in our primary market.
  • Average loans increased by $235.2 million and average interest-bearing deposits decreased by $6.7 million.

Non-interest expense compared to the fourth quarter of 2021:

  • Non-interest expense was $12.9 million, a decrease of $4.5 million driven by the absence in the 2022 quarter of non-recurring expenses of: a $2.0 million loss on pension withdrawal and $755 thousand in debt extinguishment costs.
  • Excluding non-recurring items referenced above, non-interest expense decreased $1.8 million. Fees for professional services declined $872 thousand and advertising costs declined $728 thousand as management focused on reducing discretionary expenses. The provision for commitments and letters of credit was also lower by $351 thousand. These decreases were partially offset by an increase of $599 thousand in compensation and benefits costs which included expenses related to equity grants.

Income tax expense compared to the fourth quarter of 2021:

  • Income tax expense was $164 thousand compared to $16.1 million for the prior year quarter. The 22.5% effective tax rate for the quarter reflects discrete state and federal tax items recognized in the fourth quarter, however, management expects the effective tax rate to remain near 10% for the near future. The Company had previously established and continues to maintain a full valuation allowance on its deferred tax assets. Although the Company had a loss before income tax in the prior year quarter, the tax expense recorded in that period reflects the impact of the initial recognition of the full valuation allowance on the Company's deferred tax assets.

Year ended December 31, 2022 compared to the year ended December 31, 2021

Net interest income compared to the year ended December 31, 2021:

  • Net interest income was $51.8 million, an increase of $8.9 million.
  • Net interest margin increased by 52 basis points to 2.73%.
  • Yield on average interest-earning assets increased 40 basis points to 3.28%.
  • Cost of average interest-bearing deposits decreased 14 basis points to 0.47%, due to a shift to core deposits partially offset by the competitive rate environment in our primary market.
  • Average loans increased by $132.6 million and average interest-bearing deposits decreased by $61.6 million.

Non-interest expense compared to the year ended December 31, 2021:

  • Non-interest expense was $52.8 million, a decrease of $21.9 million driven by the absence in 2022 of non-recurring expenses of: a $11.2 million loss on pension withdrawal, a $9.0 million charitable contribution, and $2.2 million in debt extinguishment costs.
  • Excluding non-recurring items referenced above, non-interest expense increased $464 thousand. An increase of $3.5 million in compensation and benefits costs was driven by raises, hiring, an increase in cash incentive compensation expense, and costs associated with equity grants made under the shareholder-approved equity incentive plan. In addition, the costs associated with being a public company increased $1.0 million in 2022. These increases were partially offset by a reduction of $1.3 million in advertising and $1.2 million in data processing, and a lower provision for commitments and letters of credit of $1.0 million.

Income tax expense compared to the year ended December 31, 2021:

  • Income tax expense was $338 thousand compared to $9.6 million for the prior year period. The year-to-date effective tax rate of 12.4% reflects the Company's current tax position. The Company had previously established and continues to maintain a full valuation allowance on its deferred tax assets. Although the Company had a loss before income tax in the prior year, the tax expense recorded in that year reflects the impact of the initial recognition of the full valuation allowance on the Company's deferred tax assets.

Balance Sheet Summary:

December 31, 2022 compared to December 31, 2021

Cash and cash equivalents:

  • Cash and cash equivalents decreased $152.3 million compared to December 31, 2021 as the Company deployed cash primarily into higher yielding loans and securities.

Securities available-for-sale:

  • Securities available-for-sale decreased $10.6 million to $314.2 million as purchases of securities were more than offset by the fair value decline in the portfolio, as well as amortization and calls.
  • The rising rate environment contributed to a $37.3 million decline in the net unrealized position of the portfolio.

Gross loans:

  • Gross loans held for investment increased $261.1 million to $1.54 billion. Excluding PPP, gross loans increased by $277.9 million.
  • Multifamily loans increased $175.0 million, non-residential real estate loans increased $74.8 million, and residential loans increased $33.5 million.
  • Originations totaled $488.2 million, including originations of $285.4 million in multifamily loans, $128.7 million in non-residential real estate loans, and $44.1 million in construction loans. In addition, $106.1 million of conforming residential mortgages in New Jersey were purchased during the period.

Deposits and borrowings:

  • Deposits totaled $1.29 billion, an increase of $41.8 million since December 31, 2021. Core deposits represented 67.7% of total deposits compared to 62.0% at December 31, 2021.
  • FHLB borrowings increased by $125.0 million to $310.5 million to support loan growth.

Capital:

  • Shareholders' equity decreased by $35.8 million to $393.7 million. The decrease was primarily driven by a $24.3 million reduction in accumulated other comprehensive income reflecting the net impact that the interest rate environment had on the Company's available-for-sale securities and the swap agreements used in its cash flow hedges. The Company also repurchased 1,298,762 of its shares at a cost of $15.6 million. 299,481of the shares repurchased were used to fund the shareholder-approved restricted stock grants. These decreases were partially offset by net income of $2.4 million.
  • Tangible equity to tangible assets was 19.24% and tangible common equity per share outstanding was $14.28.
  • The Bank's capital ratios remain above the FDIC's "well capitalized" standards.

Asset quality:

  • Non-performing loans totaled $7.8 million, or 0.50% of total loans compared to $12.0 million, or 0.94% of total loans at December 31, 2021.
  • The allowance for loan losses represented 0.87% of total loans compared to 1.13% at December 31, 2021. The allowance for loan losses was 172.52% of non-performing loans compared to 120.38% at December 31, 2021.
  • The Company recorded a net release of provision for loan losses of $224 thousand for the quarter ended December 31, 2022 and $1.0 million for the year ended December 31, 2022 driven by significant pay downs within the construction and land portfolio, partially offset by growth in our multifamily portfolio.
  • Net recoveries were $24 thousand for the quarter ended December 31, 2022 and for the year ended December 31, 2022 net charge-offs were $24 thousand.

About Blue Foundry

Blue Foundry Bancorp is the holding company for Blue Foundry Bank, a place where things are made, purpose is formed, and ideas are crafted. Headquartered in Rutherford NJ, with a presence in Bergen, Essex, Hudson, Morris, Passaic and Somerset counties, Blue Foundry Bank is a full-service, innovative bank serving the doers, movers, and shakers in our communities. We offer individuals and businesses alike the tailored products and services they need to build their futures. With a rich history dating back more than 145 years, Blue Foundry Bank has a longstanding commitment to its customers and communities. To learn more about Blue Foundry Bank visit BlueFoundryBank.com or call (888) 931-BLUE. Member FDIC.

Conference Call Information

A conference call discussing Blue Foundry's fourth quarter and year ended December 31, 2022 financial results will be held today, Wednesday, January 25, 2023 at 11:00 a.m. (EST). To listen to the live call, please dial 1-833-927-1758 (toll free), 1-646-904-5544 (local) or 1-929-526-1599 (all other locations) and use access code 372166. The webcast (audio only) will be available on BlueFoundryBank.com. The conference call will be recorded and will be available on the Company's website for one month.        

Contact:
James D. Nesci
President and Chief Executive Officer
BlueFoundryBank.com
jnesci@bluefoundrybank.com 
201-972-8900

BLUE FOUNDRY BANCORP AND SUBSIDIARY
Consolidated Statements of Financial Condition

 December 31,
2022
 September 30, 2022 December 31,
2021
 (Unaudited) (Unaudited) (Audited)
 (In thousands)
ASSETS     
Cash and cash equivalents$41,182 $57,324 $193,446
Securities available for sale, at fair value 314,248  321,320  324,892
Securities held to maturity (fair value of $29,115, $26,344 and $22,849 at December 31, 2022, September 30, 2022 and December 31, 2021, respectively) 33,705  30,749  23,281
Other investments 16,069  15,432  10,182
Loans, net 1,531,727  1,480,837  1,273,184
Interest and dividends receivable 6,893  6,431  5,372
Premises and equipment, net 29,825  29,992  28,126
Right-of-use assets 25,906  25,537  25,457
Bank owned life insurance 21,576  22,012  21,662
Other assets 22,207  22,284  8,609
Total assets$2,043,338 $2,011,918 $1,914,211
      
LIABILITIES AND SHAREHOLDERS' EQUITY     
Liabilities     
Deposits$1,288,862 $1,266,497 $1,247,040
Advances from the Federal Home Loan Bank 310,500  295,500  185,500
Advances by borrowers for taxes and insurance 9,302  10,926  9,582
Lease liabilities 27,324  26,875  26,696
Other liabilities 13,632  14,782  15,922
Total liabilities 1,649,620  1,614,580  1,484,740
      
Shareholders' equity 393,718  397,338  429,471
Total liabilities and shareholders' equity$2,043,338 $2,011,918 $1,914,211
      

BLUE FOUNDRY BANCORP AND SUBSIDIARY
Consolidated Statements of Operations
(Dollars in thousands except per share data) (Unaudited)

 Three months ended Year Ended December 31,
          
 December 31,
2022
 September 30,
2022
 December 31,
2021
  2022   2021 
          
 (unaudited) (Unaudited) (Audited)
Interest income:         
Loans$14,487  $13,692  $12,357  $52,279  $48,719 
Taxable investment income 2,970   2,571   1,757   9,678   6,821 
Non-taxable investment income 112   109   121   456   513 
Total interest income 17,569   16,372   14,235   62,413   56,053 
Interest expense:         
Deposits 2,482   1,424   1,036   5,738   7,884 
Borrowed funds 2,160   1,133   863   4,832   5,220 
Total interest expense 4,642   2,557   1,899   10,570   13,104 
Net interest income 12,927   13,815   12,336   51,843   42,949 
Release of provision for loan losses (224)  (419)  (819)  (1,001)  (2,518)
Net interest income after provision for loan losses 13,151   14,234   13,155   52,844   45,467 
Non-interest income:         
Fees and service charges 341   650   565   2,156   1,975 
Gain (loss) on securities, net       (1)  14   (1)
Other income 103   149   140   494   505 
Total non-interest income 444   799   704   2,664   2,479 
Non-interest expense:         
Compensation and benefits 7,620   7,433   7,021   29,247   25,755 
Loss on pension withdrawal       1,974      11,206 
Occupancy and equipment 1,909   1,921   2,080   7,625   7,929 
Data processing 1,324   1,559   1,501   5,754   6,933 
Debt extinguishment costs       754      2,155 
Advertising 68   125   795   1,061   2,390 
Professional services 838   1,012   1,709   4,117   4,528 
(Release of) provision for commitments and letters of credit (203)  170   148   (311)  689 
Federal deposit insurance premiums 105   98   110   381   494 
Contribution to Blue Foundry Charitable Foundation             9,000 
Other expense 1,208   1,351   1,288   4,900   3,591 
Total non-interest expenses 12,869   13,669   17,380   52,774   74,670 
Income (loss) before income tax expense 726   1,364   (3,521)  2,734   (26,724)
Income tax expense 164   123   16,103   338   9,618 
Net income (loss)$562  $1,241  $(19,624) $2,396  $(36,342)
Basic and diluted earnings (loss) per share$0.02  $0.05  $(0.75) $0.09  $(2.99)
Weighted average shares outstanding-basic 25,713,534   26,128,851   26,307,456   26,165,841   12,171,050 
Weighted average shares outstanding-diluted 26,013,015   26,246,039   26,307,456   26,270,864   12,171,050 
                    

BLUE FOUNDRY BANCORP AND SUBSIDIARY
Consolidated Financial Highlights
(Dollars in thousands except for share data) (Unaudited)

 Three months ended
          
 December 31,
2022
 September 30,
2022
 June 30,
2022
 March 31,
2022
 December 31,
2021
Performance Ratios (%)         
Return (loss) on average assets 0.11   0.25  0.01  0.12  (3.97)
Return (loss) on average equity 0.56   1.20  0.04  0.52  (17.36)
Interest rate spread (1) 2.35   2.68  2.71  2.50  2.50 
Net interest margin (2) 2.62   2.84  2.83  2.62  2.63 
Efficiency ratio (non-GAAP) (3) 97.76   92.37  96.13  104.04  110.59 
Average interest-earning assets to average interest-bearing liabilities 128.30   130.30  131.52  131.77  132.04 
Tangible equity to tangible assets (4) 19.24   19.72  20.97  21.68  22.42 
Book value per share (5)$14.30  $14.11 $14.46 $14.73 $15.06 
Tangible book value per share (5)$14.28  $14.09 $14.43 $14.72 $15.04 
          
Asset Quality         
Non-performing loans$7,767  $8,409 $9,998 $10,482 $11,983 
Real estate owned, net$  $ $ $ $ 
Non-performing assets$7,767  $8,409 $9,998 $10,482 $11,983 
Allowance for loan losses to total loans (%) 0.87   0.91  0.98  1.00  1.13 
Allowance for loan losses to non-performing loans (%) 172.52   161.73  140.53  128.46  120.38 
Non-performing loans to total loans (%) 0.50   0.56  0.70  0.78  0.94 
Non-performing assets to total assets (%) 0.38   0.42  0.51  0.54  0.63 
Net charge-offs to average outstanding loans during the period (%) (0.01)  0.01       
          


(1) Interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.
(2) Net interest margin represents net interest income divided by average interest-earning assets.
(3) Efficiency ratio represents adjusted non-interest expense divided by the sum of net interest income plus non-interest income.
(4) Tangible equity equals $392.9 million, which exclude intangible assets ($798 thousand of capitalized software). Tangible assets equal $2.04 billion and excludes intangible assets.
(5) Per share metrics are computed using 27,523,219 total shares outstanding.
   

BLUE FOUNDRY BANCORP AND SUBSIDIARY
Analysis of Net Interest Income
(Unaudited)

 Three Months Ended
 December 31, 2022 September 30, 2022 December 31, 2021
 Average
Balance
 Interest Average
Yield/Cost
 Average
Balance
 Interest Average
Yield/Cost
 Average
Balance
 Interest Average
Yield/Cost
 (Dollars in thousands)
Assets:                 
Loans (1)$1,511,941 $14,487 3.80% $1,465,114 $13,692 3.71% $1,276,698 $12,357 3.84%
Mortgage-backed securities 187,213  1,092 2.31%  197,406  1,055 2.12%  160,372  708 1.75%
Other investment securities 200,013  1,425 2.83%  204,506  1,230 2.39%  171,427  913 2.11%
FHLB stock 17,225  216 4.96%  13,141  139 4.20%  10,549  158 5.96%
Cash and cash equivalents 44,718  349 3.10%  49,163  256 2.07%  243,110  99 0.16%
Total interest-bearing assets 1,961,110  17,569 3.55%  1,929,330  16,372 3.37%  1,862,156  14,235 3.03%
Non-interest earning assets 52,258      61,264      96,592    
Total assets$2,013,368     $1,990,594     $1,958,748    
Liabilities and shareholders' equity:                 
NOW, savings, and money market deposits$848,199  1,636 0.77% $831,191  759 0.36% $715,653  256 0.14%
Time deposits 356,377  846 0.94%  405,823  665 0.65%  495,608  781 0.62%
Interest-bearing deposits 1,204,576  2,482 0.82%  1,237,014  1,424 0.46%  1,211,261  1,037 0.34%
FHLB advances 323,903  2,160 2.65%  243,647  1,133 1.84%  199,001  863 1.72%
Total interest-bearing liabilities 1,528,479  4,642 1.20%  1,480,661  2,557 0.69%  1,410,262  1,900 0.53%
Non-interest bearing deposits 42,144      49,869      43,977    
Non-interest bearing other 47,746      48,103      56,095    
Total liabilities 1,618,369      1,578,633      1,510,334    
Total shareholders' equity 394,999      411,961      448,414    
Total liabilities and shareholders' equity$2,013,368     $1,990,594     $1,958,748    
Net interest income  $12,927     $13,815     $12,335  
Net interest rate spread (2)    2.35%     2.68%     2.50%
Net interest margin (3)    2.62%     2.84%     2.63%


(1) Average loan balances are net of deferred loan fees and costs, and premiums and discounts, and include non-accrual loans.
(2) Net interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.
(3) Net interest margin represents net interest income divided by average interest-earning assets.
   


 Year Ended December 31,
  2022   2021 
 Average
Balance
InterestAverage
Yield/Cost
 Average
Balance
InterestAverage
Yield/Cost
 (Dollar in thousands)
Assets:       
Loans (1)$1,407,502$52,2793.71% $1,274,885$48,7193.82%
Mortgage-backed securities 190,540 3,9342.06%  154,882 2,9081.88%
Other investment securities 203,002 4,8202.37%  147,853 3,2372.19%
FHLB stock 12,629 5874.65%  14,373 7445.17%
Cash and cash equivalents 88,703 7930.89%  356,458 4450.12%
Total interest-bearing assets 1,902,376 62,4133.28%  1,948,451 56,0532.88%
Non-interest earning assets 64,786    87,443  
Total assets$1,967,162   $2,035,894  
Liabilities and shareholders' equity:       
NOW, savings, and money market deposits$812,473 2,9590.36% $676,697 1,0910.16%
Time deposits 412,734 2,7790.67%  610,092 6,7931.11%
Interest-bearing deposits 1,225,207 5,7380.47%  1,286,789 7,8840.61%
FHLB advances 235,589 4,8322.05%  280,985 5,2201.86%
Total interest-bearing liabilities 1,460,796 10,5700.72%  1,567,774 13,1040.84%
Non-interest bearing deposits 44,029    106,033  
Non-interest bearing other 47,707    47,560  
Total liabilities 1,552,532    1,721,367  
Total shareholders' equity 414,630    314,527  
Total liabilities and shareholders' equity$1,967,162   $2,035,894  
Net interest income $51,843   $42,949 
Net interest rate spread (2)  2.56%   2.04%
Net interest margin (3)  2.73%   2.20%


(1) Average loan balances are net of deferred loan fees and costs, and premiums and discounts, and include non-accrual loans.
(2) Net interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.
(3) Net interest margin represents net interest income divided by average interest-earning assets.
   

BLUE FOUNDRY BANCORP AND SUBSIDIARY
Adjusted Pre-Provision Net Revenue (Non-GAAP)
(Dollars in thousands except per share data) (Unaudited)

This press release contains certain supplemental financial information, described in the table below, which has been determined by methods other than U.S. Generally Accepted Accounting Principles ("GAAP") that management uses in its analysis of Blue Foundry's performance. Management believes these non-GAAP financial measures provide information useful to investors in understanding Blue Foundry's financial results. These non-GAAP measures should not be considered a substitute for GAAP basis measures and results and Blue Foundry strongly encourages investors to review its consolidated financial statements in their entirety and not to rely on any single financial measure. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names.

Net income, as presented in the Consolidated Statements of Operations, includes the provision for loan losses, provision for commitments and letters of credit, and income tax expense while pre-provision net revenue does not.

 Three months ended
 December 31,
2022
 September 30,
2022
 June 30,
2022
 March 31,
2022
 December 31,
2021
          
  
Pre-provision net revenue (PPNR) and efficiency ratio, as adjusted:           
Net interest income$12,927  $13,815  $13,162  $11,939  $12,336 
Other income 444   799   494   927   704 
Operating expenses, as reported 12,869   13,669   13,019   13,216   17,380 
Less: Fee on debt extinguishment             754 
Less: Loss on pension withdrawal             1,974 
Less: Provision for commitments and letters of credit (203)  170   (108)  (170)  148 
Less: Loss on assets held for sale             83 
Operating expenses, as adjusted 13,072   13,499   13,127   13,386   14,421 
Pre-provision net revenue (loss), as adjusted$299  $1,115  $529  $(520) $(1,381)
Efficiency ratio, as adjusted 97.8%  92.4%  96.1%  104.0%  110.6%
          
Core deposits:         
Total deposits$1,288,862  $1,266,497  $1,296,674  $1,283,022  $1,247,040 
Less: time deposits 416,260   365,548   430,696   444,936   473,795 
Core deposits$872,602  $900,949  $865,978  $838,086  $773,245 
Core deposits to total deposits 67.7%  71.1%  66.8%  65.3%  62.0%
          
Tangible equity:         
Shareholders' equity (1) (2)$393,718  $397,338  $412,293  $420,214  $429,472 
Less: intangible assets 798   760   630   452   437 
Tangible equity$392,920  $396,578  $411,663  $419,762  $429,035 
          
Tangible book value per share:         
Tangible equity$392,920  $396,578  $411,663  $419,762  $429,035 
Shares outstanding 27,523,219   28,155,292   28,522,500   28,522,500   28,522,500 
Tangible book value per share$14.28  $14.09  $14.43  $14.72  $15.04 


(1) The Company recorded a deferred tax asset valuation allowance of $16.8 million as of December 31, 2021.
(2) Accumulated other comprehensive income (AOCI) declined by $24.3 million in 2022, largely a result of the rising rate environment which negatively impacted the fair value of the Company's available-for-sale investment portfolio.

 

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