Executive Summary

Q4 2024 revenue was $34.46M, up 4.4% q/q (Q3: $33.02M; Q2: $31.39M), as higher interest income and modestly improved non-interest income offset funding cost pressure; diluted EPS was $0.61, down slightly q/q (Q3: $0.62) and down y/y (Q4’23: $0.67) on higher provision and operating expense versus the prior year .
Net interest income improved to $15.62M (Q3: $14.72M; Q2: $14.31M) while NIM held ~3.0% (Q4: 3.02%, Q3: 2.97%, Q2: 3.03%); efficiency remained tight near 41% .
Asset quality was stable q/q but higher y/y: non-accrual loans were $11.8M (0.63% of loans) vs $12.2M (0.66%) in Q3 and $7.3M (0.44% of assets) at 12/31/23; ACL/loans was 1.74% (vs 1.76% Q3; 1.80% 12/31/23) .
No formal financial guidance was provided; the Board declared a $0.18/share cash dividend (payable Jan 17, 2025) during the quarter, signaling capital strength and ongoing shareholder returns .

What Went Well and What Went Wrong

What Went Well
- Net interest income and total “revenue” (interest income + non-interest income) improved sequentially, with Q4 revenue +4.4% q/q to $34.46M; NIM improved to 3.02% from 2.97% in Q3 .
- Expense discipline continued: efficiency ratio ~40.9% in Q4 and ~41% for FY; management emphasized “tight controls on our expenses” and cited the cost efficiency ratio “improving to close to 41%” .
- Liquidity and funding: deposits rose to $1.63B from $1.56B in Q3 and $1.55B at YE23; cash and equivalents increased to $221.5M (from $172.4M in Q3), aided by mix shifts; brokered money market deposits fell to zero by YE, reducing potentially volatile funding .
- Management tone: cautiously optimistic; sees “continued slow increase in loan demand” and strength in new home construction, while keeping focus on asset quality and reserves at 1.74% ACL/loans .
What Went Wrong
- EPS declined vs prior year (Q4’24 diluted $0.61 vs $0.67) as provision swung from a recovery in Q4’23 to a small expense in Q4’24, and non-interest expense grew y/y; non-interest income also declined y/y .
- Funding costs remained elevated y/y given “higher market interest rates” and mix shift toward interest-bearing deposits; net interest spread compressed y/y (Q4’24: 2.01% vs 2.17% in Q4’23) .
- Non-interest income pressure related to cannabis-related deposit accounts continued; service fees fell y/y with management citing decreased fees from cannabis-related businesses for 2024 .

Financial Results

Metric ($USD Millions, except per-share)	Q4 2023	Q2 2024	Q3 2024	Q4 2024
Total Interest Income	30.30	30.19	32.12	33.33
Non-Interest Income	1.48	1.20	0.90	1.14
Revenue (Interest + Non-Interest)	31.78	31.39	33.02	34.46
Net Interest Income	15.52	14.31	14.72	15.62
Provision for Credit Losses	(0.45)	0.48	(0.14)	0.18
Non-Interest Expense	6.29	6.24	6.37	6.85
Net Income to Common	8.17	6.45	7.50	7.39
Diluted EPS ($)	0.67	0.53	0.62	0.61

Margin/Return Metrics	Q2 2024	Q3 2024	Q4 2024
Net Interest Margin (%)	3.03	2.97	3.02
Interest Rate Spread (%)	1.95	1.88	2.01
Efficiency Ratio (%)	40.19	40.74	40.88
ROAA (%)	1.34	1.49	1.41
ROACE (%)	8.88	10.08	9.82

Balance Sheet & Credit KPIs	6/30/2024	9/30/2024	12/31/2024
Total Assets ($B)	2.03	2.07	2.14
Cash & Equivalents ($M)	167.7	172.4	221.5
Loans, net of unearned ($B)	1.81	1.84	1.87
Total Deposits ($B)	1.50	1.56	1.63
Non-accrual Loans ($M)	7.0	12.2	11.8
NPL Ratio (% of Loans)	0.39	0.66	0.63
Allowance for Credit Losses ($M)	32.4	32.3	32.6
ACL / Loans (%)	1.80	1.76	1.74
ACL / NPL (%)	464.34	264.88	276.46

Results vs Consensus (Q4 2024)

Metric	Actual	Consensus	Surprise
Revenue ($M)	34.46	N/A	N/A
Diluted EPS ($)	0.61	N/A	N/A

Note: Wall Street consensus from S&P Global was unavailable at the time of query; therefore, estimate comparisons are not provided.

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Cash Dividend per Share	Q1 2025 payment	N/A	$0.18/share declared, payable Jan 17, 2025 (record Jan 3, 2025)	Declared
Financial Guidance	2025	None disclosed	None disclosed	Maintained “no formal guidance” stance

Earnings Call Themes & Trends

Note: No Q4 2024 earnings call transcript was found; themes reflect management commentary across recent press releases.

Topic	Previous Mentions (Q-2 and Q-1)	Current Period (Q4 2024)	Trend
Interest rates & funding costs	“Higher for longer” rate backdrop pressured deposit costs; NIM ~3.0% with spread ~1.95% (Q2) and 1.88% (Q3) .	Fed cuts were later than expected; higher interest expense reduced NII vs initial expectations .	Stabilizing slight improvement in spread/NIM (Q4 spread 2.01%, NIM 3.02%) .
Loan demand & construction	Reported increased loan activity; residential construction “surprisingly stable and growing” .	“Continued slow increase” in loan demand; new home construction improving faster than other sectors .	Gradual improvement; cautious growth posture.
Non-interest income (fees)	Decline driven by lower service fees (cannabis-related deposit fees down) .	Continued y/y pressure from lower cannabis-related fees .	Headwind persists.
Asset quality	Q2 NPLs declined; Q3 rose to 0.66% of loans; ACL/loans ~1.76%-1.80% .	NPLs 0.63% of loans; ACL/loans 1.74%; mgmt focused on reserves and delinquencies .	Stable q/q at elevated y/y levels.
Expense discipline	Efficiency ratio ~40-41% with tight cost controls .	Cost efficiency ratio “close to 41%” reiterated .	Sustained.
Liquidity & deposit mix	Deposits improved from Q2→Q3; mix shifts toward interest-bearing; brokered time deposits used .	Deposits up to $1.63B; brokered money market at zero by YE; strong cash balances at FRB .	Improved liquidity and funding stability.

Management Commentary

“The slow interest rate decline resulted in a higher interest expense for our company in 2024 than initially anticipated, reducing our net interest income. We are seeing the continued slow increase in loan demand… New home construction is one market sector that we see improving faster than some other sectors.” — Vito S. Pantilione, President & CEO .
“We continue to maintain tight controls on our expenses with our cost efficiency ratio improving to close to 41%. Asset Quality also remains an important focus as we supported the strength of our credit loss reserve at 1.74%.” .
“Our net income, tight control of our expenses and our total equity exceeding $300 million puts us in a good position to take advantage of opportunities in the market… Parke Bank will cautiously proceed in identifying new business opportunities…” .

Q&A Highlights

No earnings call transcript for Q4 2024 was located; therefore, no analyst Q&A highlights or clarifications are available for this quarter [ListDocuments returned no transcripts for the period].

Estimates Context

We attempted to retrieve S&P Global consensus for Q4 2024 revenue and EPS, but the data was unavailable at query time due to provider limits; as a result, we cannot provide a beat/miss assessment versus consensus for this quarter. Future updates should incorporate S&P Global consensus when available for precise comparison.

Key Takeaways for Investors

Sequential operating momentum: revenue and NII improved q/q with NIM at 3.02% and spread at 2.01%; efficiency ratio remains near 41%, underscoring disciplined cost control .
Funding stabilization: deposits grew to $1.63B (+$78M vs YE23) with brokered money market at zero and cash at $221.5M, supporting liquidity amid elevated rates .
Credit steady q/q but higher y/y: NPLs 0.63% of loans (vs 0.66% in Q3; 0.44% of assets at YE23), ACL/loans 1.74%; watch CRE and 1-4 family categories cited in y/y increase .
Fee headwinds linger: service fees tied to cannabis-related deposits remained a drag on non-interest income; any stabilization here could aid earnings quality .
Capital return intact: $0.18/share dividend declared during the quarter signals confidence in capital and earnings durability .
Near-term watch items: deposit mix and funding costs as the rate cycle evolves; trajectory of loan demand/new home construction; any changes in non-interest income trends .
Medium-term thesis: a cautiously growing loan book, tight expense control, and stable reserves position PKBK to benefit from a gradual normalization in rates and improved fee environment, with capital supporting measured growth and shareholder returns .

Additional Detail and Drivers

Q4 drivers vs y/y: higher interest income on loans (+$2.4M y/y to $30.86M) and FRB balances (+$0.7M y/y) were more than offset at the bottom line by higher interest expense (+$2.9M y/y), lower non-interest income (-$0.3M y/y), and higher operating expense (+$0.6M y/y) .
Deposit mix: increases in brokered time (+$61.5M), money market (+$48.4M), and time deposits (+$46.6M) offset declines in non-interest-bearing (-$48.2M) and savings (-$27.6M) vs YE23; cannabis-related deposits rose $55.2M to $151.9M .

Notes on Source Materials

Primary sources: Q4 2024 8-K (Item 2.02) and earnings press release; prior quarter press releases (Q3 and Q2 2024) used for trend analysis .
No Q4 2024 earnings call transcript was available in the document set.
Dividend press release on Dec 18, 2024 included for capital return context .

PARKE BANCORP, INC. (PKBK)·Q4 2024 Earnings Summary