# EDGAR Filing Document

**Accession Number:** 0001098146
**File Stem:** 0001171843-23-001469
**Filing Date:** 2023-3
**Character Count:** 37292
**Document Hash:** 4d6826a0dfdd2120cb3a2308eef9c7e8
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001171843-23-001469.hdr.sgml**: 20230307

**ACCESSION NUMBER**: 0001171843-23-001469

**CONFORMED SUBMISSION TYPE**: 8-K

**PUBLIC DOCUMENT COUNT**: 14

**CONFORMED PERIOD OF REPORT**: 20230307

**ITEM INFORMATION**: Results of Operations and Financial Condition

**ITEM INFORMATION**: Financial Statements and Exhibits

**FILED AS OF DATE**: 20230307

**DATE AS OF CHANGE**: 20230307

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** PATRIOT NATIONAL BANCORP INC
- **CENTRAL INDEX KEY:** 0001098146
- **STANDARD INDUSTRIAL CLASSIFICATION:** NATIONAL COMMERCIAL BANKS [6021]
- **IRS NUMBER:** 061559137
- **STATE OF INCORPORATION:** CT
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 8-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 000-29599
- **FILM NUMBER:** 23711106

**BUSINESS ADDRESS:**
- **STREET 1:** 900 BEDFORD ST
- **CITY:** STAMFORD
- **STATE:** CT
- **ZIP:** 06901
- **BUSINESS PHONE:** 2033247500

?xml version="1.0" encoding="utf-8"?Form 8-K

### 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): March 7, 2023
_______________________________

#### 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))

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 |

---

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. ☐

**Section 2 - Financial Information** 

**Item 2.02. Results of Operations and Financial Condition.**

On March 7, 2023, 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 quarter and the year ended December 31, 2022.

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.

---

| | |
|:---|:---|
| <u>Exhibit No.</u> | <u>Description</u> |
| [99.1](exh_991.htm) | [Press Release of Patriot National Bancorp, Inc., dated March 7, 2023](exh_991.htm) |
| 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.** | **PATRIOT NATIONAL BANCORP, INC.** |
| Date: March 7, 2023 | By: | <u>/s/ Joseph D. Perillo &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u> |
|  |  | Joseph D. Perillo |
|  |  | Executive Vice President and Chief Financial Officer |

---

## Exhibit 99.1

**EXHIBIT 99.1**

**Patriot Reports Fourth Quarter 2022 Net Income of $1.8 million, $0.45 per share; Full Year Net Income of $6.2 million, $1.56 per share**

**Pre-tax Income and Net Interest Margin buoyed by exceptional loan and deposit growth**

STAMFORD, Conn., March 07, 2023 (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 $1.8 million, or $0.45 basic and diluted earnings per share for the quarter ended December 31, 2022. These results compare to net income of $2.3 million, or $0.59 basic and diluted earnings per share for the third quarter of 2022 and net income of $1.9 million, or $0.48 basic and diluted earnings per share reported in the fourth quarter of 2021.

Net income for the full year ended December 31, 2022 was $6.2 million, or $1.56 basic and $1.55 diluted earnings per share, compared to a net income of $5.1 million, or $1.29 basic and diluted earnings per share for the year ended December 31, 2021. For the year ended December 31, 2021, pre-tax income included the recognition of an Employee Retention Credit ("ERC") of $2.9 million and non-recurring merger related costs of $1.9 million. Pre-tax income for the year ended 2022 of $7.8 million increased $3.8 million or 95% from the full year 2021 results, exclusive of non-recurring items. There were no non-recurring items in 2022 pre-tax income.

Along with reporting a substantial improvement in net interest income and strong earnings, the Bank reported loan growth of 14.7% and deposit growth of 14.9% at December 31, 2022 compared to December 31, 2021. The Bank's average net interest margin increased significantly to 3.77% for the quarter and 3.46% for the full year ended December 31, 2022, up from 3.05% and 2.92% for the quarter and full year ended December 31, 2021, respectively. The Bank's Payments division has increasingly been contributing to the Bank's lower-cost funding sources. This new Group is keenly focused on expanding unique deposit gathering channels, while continuing to widen the Bank's net interest margin.

**Patriot President & CEO Robert Russell stated:** "Despite the myriad impacts related to the changing interest rate environment, we are proud of the increasing operational and financial results achieved for the fourth quarter and full year 2022. Operational and business unit initiatives are gaining good traction, and we are seeing the results expressed in increasing earnings and widening net interest margin." Mr. Russell added "Our efficiency ratio has improved significantly in the fourth quarter to 64.88%.

Michael Carrazza, Patriot's Chairman commented, "Patriot remains aggressively committed to completing one or more transformational events that will elevate the scale of Patriot and its digital forward capabilities. Strategic discussions are actively underway; such event(s) will be coupled with the organic roll-out of initiatives on the digital deposit gathering and asset generating sides of the balance sheet."

In December 2022, Patriot successfully completed its refinancing of its $12.0 million senior debt facility that was scheduled to mature in December 2022.

**Financial Results:**

Total assets increased $94.9 million to $1.0 billion as of December 31, 2022, as compared to $948.5 million at December 31, 2021, primarily due to the increase in net loans from $729.6 million at December 31, 2021 to $838.0 million at December 31, 2022. Total deposits increased from $748.6 million on December 31, 2021 to $860.4 million as of December 31, 2022.

Net interest income for the three months ended December 31, 2022 was $9.6 million, an increase of $2.7 million or 38.6% from the fourth quarter of 2021. Net interest income for the year ended December 31, 2022 was $33.3 million, an increase of $8.0 million or 31.7% from the year ended December 31, 2021. These increases were primarily attributable to the growth in the loan portfolio and growth in prepaid deposits from the Payments division.

The Bank's net interest margin showed continued improvement, with an increase to 3.77% for the quarter and 3.46% for the full year ended December 31, 2022. This compares with 3.05% and 2.92% for the fourth quarter of 2021 and the full year ended December 31, 2021, respectively.

For the three months ended and year ended December 31, 2022, additional provisions for loan losses of $1.4 million and $1.9 million were recorded, respectively. As of December 31, 2022, the allowance for loan losses was $10.3 million (1.22%) of total loans, compared with $9.9 million (1.34%) on December 31, 2021.

Non-interest income for the three months ended and year ended December 31, 2022 was $1.3 million and $3.6 million, respectively. Non-interest income for the three months ended and year ended December 31, 2021 was $2.3 million and $4.4 million, respectively. The decrease in non-interest income for the year ended December 31, 2022, compared to the same period in 2021 was primarily attributable to lower gains from sales of SBA loans resulting from lower market premiums.

Non-interest expenses for the quarter ended and year ended December 31, 2022 were $7.1 million and $27.2 million, respectively. Non-interest expenses for the quarter ended and year ended December 31, 2021 were $8.8 million and $25.2 million, respectively, net of the ERC recognized by the Company in 2021 of $2.9 million. The Company was no longer eligible for the ERC under the CARES Act program after the third quarter of 2021.

For the year ended December 31, 2022, a provision for income taxes of $1.6 million was recorded, compared to a benefit for income taxes of $81,000 for the year ended December 31, 2021. The benefit for income taxes in 2021 was primarily due to a full $1.9 million reversal of the valuation reserve for deferred tax assets, which decreased the income tax provision in 2021.

As of December 31, 2022, shareholders' equity was $59.6 million, as compared with $67.3 million on December 31, 2021. While Patriot achieved a material increase in operating and earnings performance in 2022, its equity account declined as a result of market value accounting applied to the Bank's available-for-sale investment portfolio ("AFS") during the period; this market value adjustment is directly correlated to the fluctuation of interest rates and does not represent a permanent impairment in value as the Company holds such investment grade securities to maturity Accordingly, on a GAAP basis, Patriot's book value per share was $15.03 on December 31, 2022, as compared with $17.02 on December 31, 2021. Excluding the net impact of the valuation of the AFS portfolio, non-GAAP tangible book value per share was $18.63, as compared with $18.21 in the third quarter of 2022 and $17.08 on December 31, 2021.

**About the Company:**

Founded in 1994, and now celebrating its 28th 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. The 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, Mississippi, along with a Rhode Island operations center.

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. The emphasis on building strong client relationships and community involvement are cornerstones of Patriot's philosophy as it seeks 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. These forward-looking statements are based on Patriot's current expectations and assumptions regarding Patriot's business, the economy, and other future conditions. Because forward-looking statements relate to future results and occurrences, they are subject to inherent risks, uncertainties, changes in circumstances and other factors that are difficult to predict. Many possible events or factors could affect Patriot's future financial results and performance and could cause the actual results, performance, or achievements of Patriot to differ materially from any anticipated results expressed or implied by such forward-looking statements. Such risks and uncertainties include, among others: (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; (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; (25) our compensation expense associated with equity allocated or awarded to our employees; and (26) other such factors, including risk factors, as may be described in the Company's other filings with the Securities and Exchange Commission.

---

| | | | |
|:---|:---|:---|:---|
| **PATRIOT NATIONAL BANCORP, INC. AND SUBSIDIARIES** | **PATRIOT NATIONAL BANCORP, INC. AND SUBSIDIARIES** | | |
| **CONSOLIDATED BALANCE SHEETS (Unaudited)** | **CONSOLIDATED BALANCE SHEETS (Unaudited)** | | |
| *(In thousands)* | **December 31, 2022** | **September 30, 2022** | **December 31, 2021** |
| **Assets** |  |  |  |
| Cash and due from banks: |  |  |  |
| &nbsp;&nbsp;Noninterest bearing deposits and cash | $5182 | $4319 | $3264 |
| &nbsp;&nbsp;Interest bearing deposits | 33311 | 26865 | 43781 |
| Total cash and cash equivalents | 38493 | 31184 | 47045 |
| Investment securities: |  |  |  |
| &nbsp;&nbsp;Available-for-sale securities, at fair value | 84520 | 85917 | 94341 |
| &nbsp;&nbsp;Other investments, at cost | 4450 | 4450 | 4450 |
| Total investment securities | 88970 | 90367 | 98791 |
| Federal Reserve Bank stock, at cost | 2627 | 2671 | 2843 |
| Federal Home Loan Bank stock, at cost | 3874 | 5474 | 4184 |
| Gross loans receivable | 848316 | 862870 | 739488 |
| Allowance for loan losses | <u>(10310</u><u>)</u> | <u>(9952</u><u>)</u> | <u>(9905</u><u>)</u> |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net loans receivable | 838006 | 852918 | 729583 |
| SBA loans held for sale | 5211 | 8748 | 3129 |
| Accrued interest and dividends receivable | 7267 | 6504 | 5822 |
| Premises and equipment, net | 30641 | 30861 | 31500 |
| Deferred tax asset | 15527 | 16057 | 12146 |
| Goodwill | 1107 | 1107 | 1107 |
| Core deposit intangible, net | 249 | 261 | 296 |
| Other assets | 11387 | 12839 | 12035 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total assets | $1043359 | $1058991 | $948481 |
| **Liabilities** |  |  |  |
| Deposits: |  |  |  |
| &nbsp;&nbsp;Noninterest bearing deposits | $269635 | $247704 | $226713 |
| &nbsp;&nbsp;Interest bearing deposits | 590811 | 586691 | 521849 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total deposits | 860446 | 834395 | 748562 |
| Federal Home Loan Bank and correspondent bank borrowings | 85000 | 125000 | 90000 |
| Senior notes, net | 11640 | 12000 | 12000 |
| Subordinated debt, net | 9840 | 9832 | 9811 |
| Junior subordinated debt owed to unconsolidated trust, net | 8128 | 8125 | 8119 |
| Note payable | 585 | 637 | 791 |
| Advances from borrowers for taxes and insurance | 886 | 2262 | 1101 |
| Accrued expenses and other liabilities | 7251 | 8736 | 10753 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total liabilities | 983776 | 1000987 | 881137 |
| Commitments and Contingencies |  |  |  |
| **Shareholders' equity** |  |  |  |
| Preferred stock |  |  |  |
| Common stock | 106565 | 106542 | 106479 |
| Accumulated deficit | (31337) | (33107) | (37498) |
| Accumulated other comprehensive loss | (15645) | (15431) | (1637) |
| &nbsp;&nbsp;&nbsp;&nbsp;Total shareholders' equity | 59583 | 58004 | 67344 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total liabilities and shareholders' equity | $1043359 | $1058991 | $948481 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **PATRIOT NATIONAL BANCORP, INC. AND SUBSIDIARIES** | **PATRIOT NATIONAL BANCORP, INC. AND SUBSIDIARIES** | **PATRIOT NATIONAL BANCORP, INC. AND SUBSIDIARIES** | | | |
| **CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)** | **CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)** | **CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)** | | | |
|  | **Three Months Ended** | **Three Months Ended** | **Three Months Ended** | **Year Ended** | **Year Ended** |
| *(In thousands, except per share amounts)* | **December 31, 2022** | **September 30, 2022** | **December 31, 2021** | **December 31, 2022** | **December 31, 2021** |
| **Interest and Dividend Income** |  |  |  |  |  |
| Interest and fees on loans | $12865 | $11250 | $7916 | $40823 | $30115 |
| Interest on investment securities | 672 | 555 | 502 | 2307 | 1924 |
| Dividends on investment securities | 155 | 99 | 73 | 384 | 223 |
| Other interest income | 274 | 135 | 22 | 498 | 89 |
| &nbsp;&nbsp;Total interest and dividend income | 13966 | 12039 | 8513 | 44012 | 32351 |
| **Interest Expense** |  |  |  |  |  |
| Interest on deposits | 2641 | 1493 | 387 | 5300 | 2243 |
| Interest on Federal Home Loan Bank borrowings | 1185 | 806 | 756 | 3475 | 2986 |
| Interest on senior debt | 228 | 218 | 227 | 866 | 913 |
| Interest on subordinated debt | 305 | 276 | 233 | 1066 | 933 |
| Interest on note payable and other | 37 | 3 | 3 | 46 | 15 |
| &nbsp;&nbsp;Total interest expense | 4396 | 2796 | 1606 | 10753 | 7090 |
| &nbsp;&nbsp;Net interest income | 9570 | 9243 | 6907 | 33259 | 25261 |
| **Provision (credit) for loan losses** | 1410 | 200 | (200) | 1885 | (500) |
| &nbsp;&nbsp;Net interest income after provision (credit) for loan losses | 8160 | 9043 | 7107 | 31374 | 25761 |
| **Non-interest Income** |  |  |  |  |  |
| Loan application, inspection and processing fees | 108 | 102 | 54 | 386 | 257 |
| Deposit fees and service charges | 65 | 67 | 61 | 256 | 251 |
| Gains on sale of loans | 770 | 182 | 1534 | 1461 | 1886 |
| Rental income | 118 | 124 | 143 | 566 | 543 |
| (Loss) gain on sale of investment securities |  |  | (43) |  | 76 |
| Other income | 278 | 179 | 556 | 936 | 1410 |
| &nbsp;&nbsp;Total non-interest income | 1339 | 654 | 2305 | 3605 | 4423 |
| **Non-interest Expense** |  |  |  |  |  |
| Salaries and benefits | 4067 | 4330 | 3583 | 15506 | 11089 |
| Occupancy and equipment expenses | 849 | 862 | 900 | 3428 | 3430 |
| Data processing expenses | 275 | 297 | 363 | 1185 | 1451 |
| Professional and other outside services | 775 | 541 | 956 | 2664 | 3155 |
| Project expenses, net | 2 | 50 | 1867 | 133 | 1882 |
| Advertising and promotional expenses | 41 | 50 | 39 | 232 | 235 |
| Loan administration and processing expenses | 50 | 37 | 73 | 234 | 134 |
| Regulatory assessments | 219 | 245 | 258 | 817 | 907 |
| Insurance expenses | 64 | 54 | 66 | 271 | 280 |
| Communications, stationary and supplies | 134 | 208 | 154 | 616 | 604 |
| Other operating expenses | 601 | 540 | 520 | 2136 | 2004 |
| &nbsp;&nbsp;Total non-interest expense | 7077 | 7214 | 8779 | 27222 | 25171 |
| &nbsp;&nbsp;Income before income taxes | 2422 | 2483 | 633 | 7757 | 5013 |
| **Provision (benefit) for income taxes** | 652 | 157 | (1262) | 1596 | (81) |
| Net income | $1770 | $2326 | $1895 | $6161 | $5094 |
| Basic earnings per share | $0.45 | $0.59 | $0.48 | $1.56 | $1.29 |
| Diluted earnings per share | $0.45 | $0.59 | $0.48 | $1.55 | $1.29 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **FINANCIAL RATIOS AND OTHER DATA** | | | | | |
|  | **Three Months Ended** | **Three Months Ended** | **Three Months Ended** | **Year Ended** | **Year Ended** |
| ***(Dollars in thousands)*** | **December 31, 2022** | **September 30, 2022** | **December 31, 2021** | **December 31, 2022** | **December 31, 2021** |
| **Quarterly Performance Data:** | | | | | |
| Net income | $1770 | $2326 | $1895 | $6161 | $5094 |
| Return on Average Assets | 0.66% | 0.87% | 0.79% | 0.60% | 0.55% |
| Return on Average Equity | 11.72% | 15.00% | 11.21% | 9.87% | 7.75% |
| Net Interest Margin | 3.77% | 3.68% | 3.05% | 3.46% | 2.92% |
| Efficiency Ratio | 64.88% | 72.89% | 95.30% | 73.84% | 84.80% |
| Efficiency Ratio excluding project costs | 64.86% | 72.39% | 75.03% | 73.48% | 78.46% |
| % (decrease) increase in loans | -1.69% | 0.44% | 3.49% | 14.72% | 1.27% |
| % increase (decrease) in deposits | 3.12% | -1.46% | 1.89% | 14.95% | 9.17% |
| **Asset Quality:** |  |  |  |  |  |
| Nonaccrual loans | $18593 | $19182 | $23095 | $18593 | $23095 |
| Nonaccrual loans / loans | 2.19% | 2.22% | 3.12% | 2.19% | 3.12% |
| Nonaccrual loans / assets | 1.78% | 1.81% | 2.43% | 1.78% | 2.43% |
| Allowance for loan losses | $10310 | $9952 | $9905 | $10310 | $9905 |
| Allowance for loan losses / loans | 1.22% | 1.15% | 1.34% | 1.22% | 1.34% |
| Allowance / nonaccrual loans | 55.45% | 51.88% | 42.89% | 55.45% | 42.89% |
| Loan charge-offs | $1177 | $366 | $— | $1828 | $358 |
| Loan (recoveries) | $(125) | $(189) | $(25) | $(348) | $(179) |
| Net loan charge-offs (recoveries) | $1052 | $177 | $(25) | $1480 | $179 |
| **Capital Data and Capital Ratios** |  |  |  |  |  |
| Book value per share <sup>(1)</sup> | $15.03 | $14.66 | $17.02 | $15.03 | $17.02 |
| Non-GAAP Tangible book value per share <sup>(2)</sup> | $14.68 | $14.31 | $16.67 | $14.68 | $16.67 |
| Non-GAAP Tangible book value excluding other comprehensive loss per share <sup>(3)</sup> | $18.63 | $18.21 | $17.08 | $18.63 | $17.08 |
| Shares outstanding | 3965186 | 3957269 | 3956492 | 3965186 | 3956492 |
| Bank Leverage Ratio | 9.26% | 9.23% | 9.86% | 9.26% | 9.86% |
| *(1) Book value per share represents shareholders' equity divided by outstanding shares.*&nbsp;&nbsp;&nbsp;&nbsp; | *(1) Book value per share represents shareholders' equity divided by outstanding shares.*&nbsp;&nbsp;&nbsp;&nbsp; | *(1) Book value per share represents shareholders' equity divided by outstanding shares.*&nbsp;&nbsp;&nbsp;&nbsp; | *(1) Book value per share represents shareholders' equity divided by outstanding shares.*&nbsp;&nbsp;&nbsp;&nbsp; | *(1) Book value per share represents shareholders' equity divided by outstanding shares.*&nbsp;&nbsp;&nbsp;&nbsp; | *(1) Book value per share represents shareholders' equity divided by outstanding shares.*&nbsp;&nbsp;&nbsp;&nbsp; |
| *(2) Tangible book value per share represents tangible assets divided by outstanding shares.*&nbsp;&nbsp;&nbsp;&nbsp; | *(2) Tangible book value per share represents tangible assets divided by outstanding shares.*&nbsp;&nbsp;&nbsp;&nbsp; | *(2) Tangible book value per share represents tangible assets divided by outstanding shares.*&nbsp;&nbsp;&nbsp;&nbsp; | *(2) Tangible book value per share represents tangible assets divided by outstanding shares.*&nbsp;&nbsp;&nbsp;&nbsp; | *(2) Tangible book value per share represents tangible assets divided by outstanding shares.*&nbsp;&nbsp;&nbsp;&nbsp; | *(2) Tangible book value per share represents tangible assets divided by outstanding shares.*&nbsp;&nbsp;&nbsp;&nbsp; |
| *(3) Tangible book value excluding other comprehensive loss per share represents tangible assets excluding unrealized loss on investments, net of income tax divided by outstanding shares.* | *(3) Tangible book value excluding other comprehensive loss per share represents tangible assets excluding unrealized loss on investments, net of income tax divided by outstanding shares.* | *(3) Tangible book value excluding other comprehensive loss per share represents tangible assets excluding unrealized loss on investments, net of income tax divided by outstanding shares.* | *(3) Tangible book value excluding other comprehensive loss per share represents tangible assets excluding unrealized loss on investments, net of income tax divided by outstanding shares.* | *(3) Tangible book value excluding other comprehensive loss per share represents tangible assets excluding unrealized loss on investments, net of income tax divided by outstanding shares.* | *(3) Tangible book value excluding other comprehensive loss per share represents tangible assets excluding unrealized loss on investments, net of income tax divided by outstanding shares.* |
| *(In thousands)* | **December 31, 2022** | **September 30, 2022** | **December 31, 2021** |  |  |
| <u>**Non-interest bearing:**</u> |  |  |  |  |  |
| Non-interest bearing | $118541 | $125396 | $127420 |  |  |
| Prepaid DDA | 151095 | 122308 | 99293 |  |  |
| Total non-interest bearing | 269636 | 247704 | 226713 |  |  |
| <u>**Interest bearing:**</u> |  |  |  |  |  |
| NOW | 34440 | 38435 | 34741 |  |  |
| Savings | 71002 | 87443 | 109744 |  |  |
| Money market | 164827 | 133947 | 113428 |  |  |
| Money market - prepaid deposits | 46173 | 46825 | 51090 |  |  |
| Certificates of deposit, less than $250,000 | 165793 | 180253 | 142246 |  |  |
| Certificates of deposit, $250,000 or greater | 59877 | 65362 | 53584 |  |  |
| Brokered deposits | 48698 | 34426 | 17016 |  |  |
| Total Interest bearing | $590810 | $586691 | $521849 |  |  |
| **Total Deposits** | $860446 | $834395 | $748562 |  |  |
| Total Prepaid deposits | $197268 | $169133 | $150383 |  |  |
| Total deposits excluding brokered deposits | $811748 | $799969 | $731546 |  |  |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Non-GAAP Financial Measures:** | | | | |
| In addition to evaluating the Company's financial performance in accordance with U.S. generally accepted accounting principles ("GAAP"), management may evaluate certain non-GAAP financial measures, such as pre-tax income excluding Employee Retention Credit and project expenses, and per share numbers that exclude intangible assets and exclude the net reduction in Book equity resulting from the change in value of its Available for Sale investment securities (AFS). A computation and reconciliation of non-GAAP financial measures used for these purposes is contained in the accompanying Reconciliation of GAAP to Non-GAAP Measures tables. We believe that providing certain non-GAAP financial measures provides investors with information useful in understanding our financial performance, our performance trends and financial position. These non-GAAP financial measures should not be considered a substitute for GAAP basis measures and results, and we strongly encourage investors to review our consolidated financial statements in their entirety and not to rely on any single financial measure. | In addition to evaluating the Company's financial performance in accordance with U.S. generally accepted accounting principles ("GAAP"), management may evaluate certain non-GAAP financial measures, such as pre-tax income excluding Employee Retention Credit and project expenses, and per share numbers that exclude intangible assets and exclude the net reduction in Book equity resulting from the change in value of its Available for Sale investment securities (AFS). A computation and reconciliation of non-GAAP financial measures used for these purposes is contained in the accompanying Reconciliation of GAAP to Non-GAAP Measures tables. We believe that providing certain non-GAAP financial measures provides investors with information useful in understanding our financial performance, our performance trends and financial position. These non-GAAP financial measures should not be considered a substitute for GAAP basis measures and results, and we strongly encourage investors to review our consolidated financial statements in their entirety and not to rely on any single financial measure. | In addition to evaluating the Company's financial performance in accordance with U.S. generally accepted accounting principles ("GAAP"), management may evaluate certain non-GAAP financial measures, such as pre-tax income excluding Employee Retention Credit and project expenses, and per share numbers that exclude intangible assets and exclude the net reduction in Book equity resulting from the change in value of its Available for Sale investment securities (AFS). A computation and reconciliation of non-GAAP financial measures used for these purposes is contained in the accompanying Reconciliation of GAAP to Non-GAAP Measures tables. We believe that providing certain non-GAAP financial measures provides investors with information useful in understanding our financial performance, our performance trends and financial position. These non-GAAP financial measures should not be considered a substitute for GAAP basis measures and results, and we strongly encourage investors to review our consolidated financial statements in their entirety and not to rely on any single financial measure. | In addition to evaluating the Company's financial performance in accordance with U.S. generally accepted accounting principles ("GAAP"), management may evaluate certain non-GAAP financial measures, such as pre-tax income excluding Employee Retention Credit and project expenses, and per share numbers that exclude intangible assets and exclude the net reduction in Book equity resulting from the change in value of its Available for Sale investment securities (AFS). A computation and reconciliation of non-GAAP financial measures used for these purposes is contained in the accompanying Reconciliation of GAAP to Non-GAAP Measures tables. We believe that providing certain non-GAAP financial measures provides investors with information useful in understanding our financial performance, our performance trends and financial position. These non-GAAP financial measures should not be considered a substitute for GAAP basis measures and results, and we strongly encourage investors to review our consolidated financial statements in their entirety and not to rely on any single financial measure. | In addition to evaluating the Company's financial performance in accordance with U.S. generally accepted accounting principles ("GAAP"), management may evaluate certain non-GAAP financial measures, such as pre-tax income excluding Employee Retention Credit and project expenses, and per share numbers that exclude intangible assets and exclude the net reduction in Book equity resulting from the change in value of its Available for Sale investment securities (AFS). A computation and reconciliation of non-GAAP financial measures used for these purposes is contained in the accompanying Reconciliation of GAAP to Non-GAAP Measures tables. We believe that providing certain non-GAAP financial measures provides investors with information useful in understanding our financial performance, our performance trends and financial position. These non-GAAP financial measures should not be considered a substitute for GAAP basis measures and results, and we strongly encourage investors to review our consolidated financial statements in their entirety and not to rely on any single financial measure. |
| **Reconciliation of GAAP to Non-GAAP Measures (unaudited):** |  |  |  |  |
|  | **Three Months Ended** | **Three Months Ended** | **Year Ended** | **Year Ended** |
| ***(Dollars in thousands)*** | **December 31, 2022** | **December 31, 2021** | **December 31, 2022** | **December 31, 2021** |
| **Net Income excluding Employee retention Credit (ERC) and project expenses:** | **Net Income excluding Employee retention Credit (ERC) and project expenses:** |  |  |  |
| Net Income reported | $1770 | $1895 | $6161 | $5094 |
| Provision (benefit) for income taxes | 652 | (1262) | 1596 | (81) |
| Income before income taxes reported | 2422 | 633 | 7757 | 5013 |
| Employee Retention Credit |  |  |  | (2896) |
| Project expenses related to merger with American Challenger |  | 1851 |  | 1851 |
| **Pre-tax income excluding ERC and project expenses** | $**2422** | $**2484** | $**7757** | $**3968** |
| ***(Dollars in thousands)*** | **December 31, 2022** | **September 30, 2022** | **December 31, 2021** |  |
| **Tangible book value per share** |  |  |  |  |
| Total shareholders' equity | $59583 | $58004 | $67344 |  |
| Goodwill | (1107) | (1107) | (1107) |  |
| Core deposit intangible, net | (249) | (261) | (296) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;**Tangible book value** | $**58227** | $**56636** | $**65941** |  |
| Shares outstanding | 3965186 | 3957269 | 3956492 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;**Tangible book value per share** | $**14.68** | $**14.31** | $**16.67** |  |
| **Tangible book value excluding other comprehensive loss per share** |  |  |  |  |
| Tangible book value | $58227 | $56636 | $65941 |  |
| Other comprehensive loss | 15645 | 15431 | 1637 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;**Tangible book value excluding other comprehensive loss** | $**73872** | $**72067** | $**67578** |  |
| Shares outstanding | 3965186 | 3957269 | 3956492 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;**Tangible book value excluding other comprehensive loss per share** | $**18.63** | $**18.21** | $**17.08** |  |

---

---

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

---