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PB

PCB BANCORP (PCB)·Q1 2025 Earnings Summary

Executive Summary

  • EPS of $0.53 rose 15% q/q and 61% y/y; a beat versus consensus $0.49, driven by higher net interest income and lower funding costs (EPS beat +$0.04; consensus 3 estimates) *.
  • Revenue (S&P Global definition) of $25.27M missed consensus $26.40M as SBA gain-on-sale and servicing income declined; however, net interest income increased 4.8% q/q and NIM expanded to 3.28% *.
  • Balance sheet growth remained robust: loans HFI +3.7% q/q to $2.73B and deposits +3.8% q/q to $2.71B; core deposits reached 59.3% and uninsured deposits rose to 41.4% .
  • Credit metrics stayed strong (NPLs/loans 0.23%, ACL 1.17%), though NPLs increased due to residential mortgage nonaccruals; management flagged macro/tariff uncertainty but expressed confidence in continued execution .
  • Dividend increased to $0.20 per share; continued capital strength (Tier 1 leverage 12.14%) supports payout and growth .

What Went Well and What Went Wrong

What Went Well

  • Net interest margin expanded to 3.28% (from 3.18% in Q4), as funding costs declined; net interest income rose to $24.3M (+4.8% q/q) .
  • Strong balance sheet growth: loans HFI +$98.2M (+3.7% q/q) and deposits +$98.6M (+3.8% q/q); book value per share increased to $25.78 .
  • Management tone confident on execution despite macro volatility: “continued robust growth in loan and deposit balances, expansion in net interest margin, and outstanding credit metrics” .

What Went Wrong

  • Noninterest income fell 15.2% q/q to $2.58M, with SBA gain-on-sale down 23.6% and servicing income down 15.8% q/q .
  • NPLs increased to $6.25M (0.23% of loans) from $4.69M q/q, primarily from residential mortgage nonaccruals ($3.15M) .
  • Uninsured deposits rose to 41.4% (from 39.6% in Q4), modestly elevating funding risk sensitivity; efficiency ratio ticked up to 53.88% .

Financial Results

P&L and Margin Summary

MetricQ1 2024Q4 2024Q1 2025
Net Interest Income ($M)$21.00 $23.16 $24.28
Noninterest Income ($M)$2.95 $3.04 $2.58
Provision for Credit Losses ($M)$1.09 $2.00 $1.60
Noninterest Expense ($M)$16.35 $13.89 $14.47
Net Income ($M)$4.69 $7.03 $7.74
Diluted EPS ($)$0.33 $0.46 $0.53
Net Interest Margin (%)3.10% 3.18% 3.28%
Efficiency Ratio (%)68.29% 53.02% 53.88%

Consensus vs. Actual (S&P Global)

MetricQ1 2024Q4 2024Q1 2025
EPS Consensus Mean ($)0.4467*0.4600*0.4867*
EPS Actual ($)0.33 0.46 0.53
Revenue Consensus Mean ($M)25.30*25.93*26.40*
Revenue Actual ($M)22.85*24.21*25.27*
EPS - # of Estimates3*3*3*
Revenue - # of Estimates3*3*3*

Values marked with * retrieved from S&P Global.

Segment and Balance Mix

Loans ($M)Q1 2024Q4 2024Q1 2025
Commercial Real Estate (Total)$1,614.16 $1,752.55 $1,815.15
Commercial & Industrial$371.93 $472.76 $494.70
Consumer (Total)$411.87 $404.07 $417.77
Loans HFI$2,397.96 $2,629.39 $2,727.61
Loans HFS$3.26 $6.29 $12.10
Total Loans$2,401.22 $2,635.68 $2,739.71

KPIs and Capital

KPIQ1 2024Q4 2024Q1 2025
Total Deposits ($M)$2,402.84 $2,615.79 $2,714.40
Uninsured Deposits ($M)$1,017.70 $1,036.45 $1,125.07
Core Deposits (% of Total)62.2% 57.7% 59.3%
NPLs / Loans HFI (%)0.21% 0.18% 0.23%
NPAs / Assets (%)0.17% 0.15% 0.20%
ACL / Loans HFI (%)1.18% 1.16% 1.17%
Tier 1 Leverage (Consolidated)12.73% 12.45% 12.14%
Book Value / Share ($)24.54 25.30 25.78

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Dividend per Common Share ($)Q2 2025 payout (May 16)$0.18 paid in Q4 2024 $0.20 declared April 23, 2025 Raised
Revenue2025Not providedNot providedMaintained (no guidance)
Net Interest Margin2025Not providedNot providedMaintained (no guidance)
Tax Rate2025Not providedNot providedMaintained (no guidance)
Operating Expense2025Not providedNot providedMaintained (no guidance)

Management did not provide quantitative guidance; commentary emphasized balance sheet growth, efficiency, and branch expansion .

Earnings Call Themes & Trends

Note: No Q1 2025 earnings call transcript was available in the document set; themes below reflect press releases and the Q1 investor presentation.

TopicPrevious Mentions (Q3 2024)Previous Mentions (Q4 2024)Current Period (Q1 2025)Trend
Macro/TariffsFocus on footprint expansion; no tariff commentary Wildfire impacts assessed; operational efficiency noted Explicit caution on tariffs/trade restrictions and capital markets volatility Elevated macro caution
Net Interest MarginNIM 3.25%; funding costs rising y/y NIM 3.18%; Fed cuts reduced loan yield NIM 3.28%; cost of interest-bearing liabilities decreased Improving
Deposit Mix/Core DepositsRetail deposits +2.0% q/q Retail deposits +0.4% q/q Retail deposits +7.0% q/q; core deposits 59.3%; uninsured 41.4% Strengthening retail; monitor uninsured
Credit QualityNPAs 0.24%; classified assets 0.32% NPLs down to 0.18%; OREO eliminated NPLs up to 0.23% (residential mortgage); NPAs 0.20% Slight deterioration but still low
Operational EfficiencyEfficiency ratio 57.63% Efficiency ratio 53.02% Efficiency ratio 53.88% Stable efficiency
Systems/TechnologyCore system conversion costs and credits referenced One-time relationship credit in data processing Lower data processing credits; normalized charges Normalizing post-conversion
SBA/LitigationSBA reimbursement issue disclosed Continued SBA reimbursement disclosure Legal settlement contingencies recognized; SBA issue backdrop Ongoing resolution efforts

Management Commentary

  • “Our strong first quarter results were highlighted by continued robust growth in loan and deposit balances, expansion in net interest margin, and outstanding credit metrics.” — Henry Kim, President & CEO .
  • “In light of the recent news on tariffs and trade restrictions, and current volatility in capital markets, the outlook for the near future appears increasingly uncertain. Nevertheless, as a relationship bank, we are well-positioned…” .
  • “Credit quality remains strong, and capital level remains robust… organic growth continues to outpace our peer group… grow our balance sheet, operate efficiently, expand our branch network, and increase profitability…” .

Q&A Highlights

No Q1 2025 earnings call transcript was available; therefore, analyst Q&A themes and management responses could not be assessed from primary documents.

Estimates Context

  • EPS beat: $0.53 vs $0.4867 consensus (+$0.04), supported by NIM expansion and lower funding costs, while provision remained contained at $1.6M *.
  • Revenue miss: $25.27M vs $26.40M consensus, reflecting weaker SBA gain-on-sale and servicing income despite stronger net interest income *.
  • Prior quarters: Q4 2024 EPS in-line ($0.46 vs $0.46); revenue miss ($24.21M vs $25.93M). Q1 2024 EPS miss ($0.33 vs $0.45) and revenue miss ($22.85M vs $25.30M)*.

Values marked with * retrieved from S&P Global.

Key Takeaways for Investors

  • NIM expansion and deposit growth are key near-term catalysts; continued repricing of interest-bearing deposits should support margin resilience .
  • Robust loan growth across CRE, C&I, and residential mortgages underpins earnings; watch for sustained origination with disciplined credit .
  • Credit metrics remain strong despite a rise in residential mortgage nonaccruals; overall NPLs/loans at 0.23% and ACL at 1.17% indicate conservative reserves .
  • Funding mix improving (retail deposits +7% q/q), but uninsured deposits rose to 41.4%; monitor liquidity buffers and deposit stability through macro volatility .
  • Efficiency ratio stable at ~54%; post-core conversion credits have normalized, implying steady OpEx discipline required to offset lower noninterest income .
  • Dividend raised to $0.20; strong capital (Tier 1 leverage 12.14%) supports returns while assets now >$3.0B—track implications of crossing consolidated capital reporting thresholds highlighted last quarter .
  • Estimate revisions likely: upward bias to EPS on NIM assumptions and loan growth; downward bias to revenue line items tied to SBA premiums/servicing unless volumes/premiums rebound *.

Values marked with * retrieved from S&P Global.