Princeton Bancorp Announces Second Quarter 2025 Results
PRINCETON, N.J., July 24, 2025 /PRNewswire/ -- Princeton Bancorp, Inc. (the "Company") (NASDAQ - BPRN), the bank holding company for The Bank of Princeton (the "Bank"), today reported its unaudited financial condition and results of operations for the quarter and six months ended June 30, 2025.
President/CEO Edward Dietzler commented on the quarter results, "Although we were disappointed with the large previously disclosed credit loss recorded in the second quarter, we are encouraged by the improvement in net interest income and in non-interest income, as well as a reduction in operating expenses this quarter, reflecting improvement in our earnings excluding our provision for credit losses. Additionally, we repurchased 173 thousand shares of our common stock at an average price of $31.14 as part of the share repurchase program. We expect stronger earnings in the second half of 2025.
The Company reported net income of $688 thousand, or $0.10 per diluted common share, for the second quarter of 2025, compared to $5.4 million, or $0.77 per diluted common share, for the first quarter of 2025, and net income of $5.1 million, or $0.80 per diluted common share, for the second quarter of 2024. The decrease in net income for the second quarter of 2025 when compared to the first quarter of 2025 was primarily due to an increase in provision for credit losses of $6.7 million partially offset by a decrease in non-interest expense of $283 thousand, an increase in net-interest income of $53 thousand, an increase in non-interest income of $61 thousand and a decrease in income tax expense of $1.6 million. The decrease in net income for the second quarter of 2025 when compared to the second quarter of 2024 was primarily due to increases in the provision for credit losses of $7.1 million and in non-interest expense of $1.5 million , partially offset by increases of $2.8 million in net-interest income and $164 thousand in non-interest income, and a decrease of $1.1 million in income tax expense.
Review of Statements of Financial Condition
Total assets were $2.24 billion at June 30, 2025, a decrease of $98.6 million, or 4.21% when compared to $2.34 billion at the end of 2024. The primary reasons for the decrease in total assets were related to decreases in cash and cash equivalents of $96.3 million and investment securities of $22.4 million, partially offset by an increase in net loans of $20.4 million. The increase in the Company's net loans consisted of increases of $40.5 million in residential mortgages, and $3.3 million in home equity and consumer loans, partially offset by decreases of $14.4 million in commercial and industrial loans, $6.8 million in commercial real estate loans and $1.8 million in construction loans.
Total deposits on June 30, 2025, decreased $100.3 million, or 4.93%, when compared to December 31, 2024. The decrease in the Company's deposits consisted primarily of decreases in certificates of deposit of $52.7 million, money market deposits of $27.3 million, and interest-bearing demand deposits of $17.9 million. The decrease in the certificates was strategically planned, including a reduction in brokered deposits of $26 million which was not replenished, as was a pricing structure designed to reduce the Bank's cost of funds. On balance sheet liquidity remains strong at June 30, 2025.
Total stockholders' equity at June 30, 2025, decreased $94 thousand or 0.04% when compared to December 31, 2024. The decrease was primarily due to a $5.6 million increase in purchases of treasury stock, partially offset by an increase in retained earnings of $1.8 million (which consisted of $6.1 million in net income, partially offset by $4.3 million of cash dividends recorded during the period), an increase in paid-in capital of $1.8 million, and a decrease in accumulated other comprehensive loss of $1.9 million. The ratio of equity to total assets at June 30, 2025, and at December 31, 2024, was 11.7% and 11.2%, respectively.
Asset Quality
At June 30, 2025, non-performing assets totaled $16.5 million, a decrease of $10.6 million when compared to the amount at December 31, 2024.
Review of Quarterly and Six-Month Financial Results
Net interest income was $18.8 million for the second quarter of 2025, an increase of $53 thousand over the first quarter of 2025, and an increase of $2.8 million compared to $16.0 million for the second quarter of 2024. While net interest income was relatively consistent with the prior 2025 quarter, interest expense decreased $592 thousand, or 4.1%, partially offset by a decrease in interest income of $539 thousand, or 1.6%. The net interest margin for the second quarter of 2025 was 3.54%, an increase of 3 basis points when compared to the first quarter of 2025, and an increase of 10 basis points when compared to the second quarter of 2024. When comparing the second quarter of 2025 and the first quarter of 2025 periods, the decrease in interest expense and the increase in net interest margin were primarily associated with a decrease in total interest-bearing deposits of $41.3 million and as well as a decrease in the Company's cost of funds of 10 basis points. The decrease in interest income for the second quarter was due to a $35.7 million decrease in average interest-earning assets (caused mostly by a $19.1 million reduction in the average balance of Federal funds sold, a $9.8 million reduction in the average balance of total securities, and a $5.5 million reduction in the average balance of loans), and a 7-basis point decrease in the yield on interest-earning assets when compared to the first quarter of 2025. For the six-month period ended June 30, 2025, the Company recorded net income of $6.1 million, or $0.88 per diluted common share, compared to $9.5 million, or $1.48 per diluted common share, for the same period in 2024. The decrease was primarily due to the charge-off recorded in the second quarter of 2025 and discussed below.
When comparing the second quarter of 2025 and second quarter of 2024, net-interest income increased by $2.8 million, which was primarily due to an increase in average interest-earning assets of $261.2 million and the Bank's cost of funds decreasing by 32 basis points. These were partially offset by the increase in average interest-bearing deposits of $213.9 million, and a decrease of 16 basis points in the yield earned on interest-earning assets.
The Company recorded a provision for credit losses of $7.0 million during the second quarter of 2025, primarily associated with the charge-off of $9.9 million previously disclosed on the Company's Form 8-K filed with the Securities and Exchange Commission on May 28, 2025. The charge-off included a $2.4 million specific reserve that had previously been reserved in the allowance for loan losses and as well as changes in the composition in the allowance for loan losses consistent with typical business activity. The current quarter's provision recorded on the Company's statements of income was $6.7 million higher when compared to the provision for credit losses for the first quarter of 2025 and was $7.1 million higher when compared to the second quarter of 2024. For the second quarter of 2025, the Company recorded charge-offs of $9.9 million and recoveries of $90 thousand. The coverage ratio of the allowance for credit losses to period end loans was 1.14% at June 30, 2025, and 1.30% at December 31, 2024.
Total non-interest income of $2.3 million for the second quarter of 2025 increased $61 thousand or 2.8% when compared to the first quarter of 2025 and increased $164 thousand or 7.9% when compared to the second quarter of 2024. The increase in the second quarter of 2025 when compared to the first quarter of 2025 was due to an increase of $40 thousand in fees and service charges, an increase of $28 thousand in loan fees, and an increase of $23 thousand in income from bank-owned life insurance, partially offset by a decrease in other non-interest income of $30 thousand. The increase over the prior year's second quarter was primarily due to an increase in other non-interest income of $206 thousand, and an increase in income from bank owned life insurance of $106 thousand, partially offset by a decrease in loan fees of $234 thousand.
Total non-interest expense of $13.5 million for the second quarter of 2025 decreased $283 thousand, or 2.1%, when compared to the first quarter of 2025. This decrease over the prior quarter was primarily due to decreases in occupancy and equipment of $138 thousand, federal deposit insurance expense of $118 thousand, data processing and communications expenses of $83 thousand, and salaries and employee benefits expense of $79 thousand, partially offset by an increase in office expense of $128 thousand, and in other non-interest expense of $102 thousand. Total non-interest expense for the second quarter of 2025 increased $1.5 million or 12.5% when compared to the second quarter of 2024. This increase was primarily related to increases in salaries and employee benefits expense of $650 thousand, occupancy and equipment expense of $297 thousand, data processing and communications expense of $139 thousand, federal deposit insurance expense of $136 thousand, professional fees of $119 thousand, and core deposit intangible expense of $108 thousand, all primarily associated with the Cornerstone Bank acquisition in the third quarter of 2024.
For the quarter ended June 30, 2025, the Company recorded an income tax benefit of ($92) thousand, resulting in an effective tax rate of (15.4)%, which was primarily the result of the loan loss provision, compared to an income tax expense of $1.5 million resulting in an effective tax rate of 21.9% for the quarter ended March 31, 2025 and compared to an income tax expense of $1.0 million resulting in an effective tax rate of 16.8% for the quarter ended June 30, 2024.
About Princeton Bancorp, Inc. and The Bank of Princeton
Princeton Bancorp, Inc. is the holding company for The Bank of Princeton, a community bank founded in 2007. The Bank is a New Jersey state-chartered commercial bank with 28 branches in New Jersey, including three in Princeton and others in Bordentown, Browns Mills, Burlington, Chesterfield, Cherry Hill, Cream Ridge, Deptford, Fort Lee, Hamilton, Kingston, Lakewood, Lambertville, Lawrenceville, Medford, Monroe, Moorestown, New Brunswick, Palisades Park, Pennington, Piscataway, Princeton Junction, Quakerbridge, Sicklerville, Voorhees, and Woodbury. There are also five branches in the Philadelphia, Pennsylvania area and two in the New York City metropolitan area. The Bank of Princeton is a member of the Federal Deposit Insurance Corporation.
Forward-Looking Statements
The Company may from time to time make written or oral "forward-looking statements," including statements contained in the Company's filings with the Securities and Exchange Commission, in its reports to stockholders and in other communications by the Company (including this press release), which are made in good faith by the Company pursuant to the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995 and Section 21E of the Securities Exchange Act of 1934, as amended.
These forward-looking statements involve risks and uncertainties, such as statements of the Company's plans, objectives, expectations, estimates and intentions that are subject to change based on various important factors (some of which are beyond the Company's control). The most significant factors that could cause future results to differ materially from those anticipated by our forward-looking statements include the ongoing impact of higher tariffs imposed by the Trump administration, higher inflation levels, and general economic and recessionary concerns, all of which could impact economic growth and could cause an increase in loan delinquencies, a reduction in financial transactions and business activities including decreased deposits and reduced loan originations, difficulties in managing liquidity in a rapidly changing and unpredictable market, and supply chain disruptions. Other factors that could cause actual results to differ materially from those indicated by forward-looking statements include, but are not limited to, the following factors: the integration of the businesses of the Company and Cornerstone Bank acquired in 2024; the global impact of the military conflicts in the Ukraine and the Middle East; the impact of any future pandemics or other natural disasters; civil unrest, rioting, acts or threats of terrorism, or actions taken by the local, state and Federal governments in response to such events, which could impact business and economic conditions in our market area; the strength of the United States economy in general and the strength of the local economies in which the Company and Bank conduct operations; the effects of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System; market and monetary fluctuations; market volatility; the value of the Bank's products and services as perceived by actual and prospective customers, including the features, pricing and quality compared to competitors' products and services; the willingness of customers to substitute competitors' products and services for the Bank's products and services; credit risk associated with the Bank's lending activities; risks relating to the real estate market and the Bank's real estate collateral; the impact of changes in applicable laws and regulations and requirements arising out of our supervision by banking regulators; other regulatory requirements applicable to the Company and the Bank; and the timing and nature of the regulatory response to any applications filed by the Company and the Bank; technological changes; other acquisitions; changes in consumer spending and saving habits; those risks under the heading "Risk Factors" set forth in the Bank's Annual Report on Form 10-K for the year ended December 31, 2024, and the success of the Company at managing the risks involved in the foregoing.
The Company cautions that the foregoing list of important factors is not exclusive. The Company does not undertake to update any forward-looking statement, whether written or oral, that may be made from time to time by or on behalf of the Company, except as required by applicable law or regulation.
Princeton Bancorp, Inc.
Consolidated Statements of Financial Condition
(Unaudited)
(Dollars in thousands, except per share data)
June 30, 2025 vs
June 30, 2025 vs
June 30,
December 31,
June 30,
December 31, 2024
June 30, 2024
2025
2024
2024
$ Change
% Change
$ Change
% Change
ASSETS
Cash and cash equivalents
$ 21,094
$ 117,348
$ 151,305
$ (96,254)
(82.02)
%
$ (130,211)
(86.06)
%
Securities available-for-sale taxable
185,177
207,442
92,001
(22,265)
(10.73)
93,176
101.28
Securities available-for-sale tax-exempt
39,586
39,729
39,688
(143)
(0.36)
(102)
(0.26)
Securities held-to-maturity
157
161
165
(4)
(2.48)
(8)
(4.85)
Loans receivable, net of deferred loan fees
1,839,228
1,818,875
1,573,352
20,353
1.12
265,876
16.90
Allowance for credit losses
(21,014)
(23,657)
(18,464)
2,643
(11.17)
(2,550)
13.81
Goodwill
14,381
14,381
8,853
-
-
5,528
62.44
Core deposit intangible
3,185
3,632
1,191
(447)
(12.31)
1,994
167.42
Other real estate owened
-
295
-
(295)
(100.00)
-
N/A
Other assets
159,874
162,027
135,850
(2,153)
(1.33)
24,024
17.68
TOTAL ASSETS
$ 2,241,668
$ 2,340,233
$ 1,983,941
$ (98,565)
(4.21)
%
$ 257,727
12.99
%
LIABILITIES
Non-interest checking
$ 299,902
$ 300,972
$ 245,073
$ (1,070)
(0.36)
%
$ 54,829
22.37
%
Interest checking
282,656
300,559
223,759
(17,903)
(5.96)
58,897
26.32
Savings
169,663
170,880
146,935
(1,217)
(0.71)
22,728
15.47
Money market
463,206
490,543
403,926
(27,337)
(5.57)
59,280
14.68
Time deposits over $250,000
220,474
208,858
154,605
11,616
5.56
65,869
42.60
Other time deposits
496,471
560,813
524,774
(64,342)
(11.47)
(28,303)
(5.39)
Total deposits
1,932,372
2,032,625
1,699,072
(100,253)
(4.93)
233,300
13.73
Borrowings
10,000
-
-
10,000
100.00
10,000
N/A
Other liabilities
37,350
45,568
40,028
(8,218)
(18.03)
(2,678)
(6.69)
TOTAL LIABILITIES
1,979,722
2,078,193
1,739,100
(98,471)
(4.74)
240,622
13.84
STOCKHOLDERS' EQUITY
Paid-in capital
121,684
119,908
99,179
1,776
1.48
22,505
22.69
Treasury stock 1
(6,413)
(842)
(842)
(5,571)
661.64
(5,571)
661.64
Retained earnings
153,718
151,915
155,083
1,803
1.19
(1,365)
(0.88)
Accumulated other comprehensive income (loss)
(7,043)
(8,941)
(8,579)
1,898
(21.23)
1,536
(17.90)
TOTAL STOCKHOLDERS' EQUITY
261,946
262,040
244,841
(94)
(0.04)
17,105
6.99
TOTAL LIABILITIES
AND STOCKHOLDERS' EQUITY
$ 2,241,668
$ 2,340,233
$ 1,983,941
$ (98,565)
(4.21)
%
$ 257,727
12.99
%
Book value per common share
$ 38.49
$ 38.07
$ 38.54
$ 0.42
1.10
%
$ (0.05)
(0.13)
%
Tangible book value per common share 2
$ 35.91
$ 35.45
$ 36.96
$ 0.46
1.30
%
$ (1.05)
(2.84)
%
1Treasury stock repurchases commenced March 8, 2024, associated with the stock repurchase program announced August 10, 2023.
2Tangible book value per common share is a non-GAAP measure.
For more informaion, see "Supplemental Information - Non-GAAP Financial Measures (Unaudited)" below.
Princeton Bancorp, Inc.
Loan and Deposit Tables
(Unaudited)
The components of loans receivable, net at June 30, 2025 and December 31, 2024 were as follows:
June 30,
December 31,
2025
2024
(In thousands)
Commercial real estate
$ 1,378,327
$ 1,385,085
Commercial and industrial
78,409
92,857
Construction
255,335
257,169
Residential first-lien mortgages
108,558
68,030
Home equity / consumer
21,416
18,133
Total loans
1,842,045
1,821,274
Deferred fees and costs
(2,817)
(2,399)
Allowance for credit losses
(21,014)
(23,657)
Loans, net
$ 1,818,214
$ 1,795,218
The components of deposits at June 30, 2025 and December 31, 2024 were as follows:
June 30,
December 31,
2025
2024
(In thousands)
Demand, non-interest-bearing
$ 299,902
$ 300,972
Demand, interest-bearing
282,656
300,559
Savings
169,663
170,880
Money market
463,206
490,543
Time deposits
716,945
769,671
Total deposits
$ 1,932,372
$ 2,032,625
Princeton Bancorp, Inc.
Consolidated Statements of Income
(Unaudited)
(Amounts in thousands except per share data)
Three Months Ended June 30,
2025
2024
$ Change
% Change
Interest and dividend income
Loans and fees
$ 29,620
$ 26,034
$ 3,586
13.8 %
Available-for-sale debt securities:
Taxable
2,298
1,001
1,297
129.6 %
Tax-exempt
279
286
(7)
-2.4 %
Held-to-maturity debt securities
2
3
(1)
-33.3 %
Other interest and dividend income
557
2,086
(1,529)
-73.3 %
Total interest and dividends
32,756
29,410
3,346
11.4 %
Interest expense
Deposits
13,933
13,442
491
3.7 %
Borrowings
13
-
13
N/A
Total interest expense
13,946
13,442
504
3.7 %
Net interest income
18,810
15,968
2,842
17.8 %
Provision for (reversal of) credit losses
6,956
(118)
7,074
-5994.9 %
Net interest income after provision for (reversal of) credit losses
11,854
16,086
(4,232)
-26.3 %
Non-interest income
Income from bank-owned life insurance
494
388
106
27.3 %
Fees and service charges
551
465
86
18.5 %
Loan fees, including prepayment penalties
703
937
(234)
-25.0 %
Other
503
297
206
69.4 %
Total non-interest income
2,251
2,087
164
7.9 %
Non-interest expense
Salaries and employee benefits
7,093
6,443
650
10.1 %
Occupancy and equipment
2,147
1,850
297
16.1 %
Professional fees
721
602
119
19.8 %
Data processing and communications
1,543
1,404
139
9.9 %
Federal deposit insurance
415
279
136
48.7 %
Advertising and promotion
152
156
(4)
-2.6 %
Office expense
238
155
83
53.5 %
Core deposit intangible
219
111
108
97.3 %
Other
981
1,009
(28)
-2.8 %
Total non-interest expense
13,509
12,009
1,500
12.5 %
Income before income tax expense
596
6,164
(5,568)
-90.3 %
Income tax (benefit) expense
(92)
1,038
(1,130)
-108.9 %
Net income
$ 688
$ 5,126
(4,438)
-86.6 %
Net income per common share - basic
$ 0.10
$ 0.81
$ ...
