First Bank Reports First Quarter 2022 Net Income of $8.2 Million

Source: Nasdaq GlobeNewswire / 25 Apr 2022 15:30:01 America/Chicago

HAMILTON, N.J., April 25, 2022 (GLOBE NEWSWIRE) -- First Bank (Nasdaq Global Market: FRBA) (the Bank) today announced results for the first quarter of 2022, including net income of $8.2 million, or $0.41 per diluted share. Return on average assets, return on average equity and return on average tangible equityⁱ for the first quarter of 2022 were 1.31%, 12.25% and 13.22%, respectively. In the first quarter of 2021, the Bank reported net income of $9.7 million, or $0.49 per diluted share, and return on average assets, return on average equity and return on average tangible equityⁱ of 1.66%, 16.21% and 17.52%, respectively.

First Quarter 2022 Performance Highlights:

Total loans of $2.15 billion at March 31, 2022 reflected growth of $39.8 million, or 1.9%, from December 31, 2021. Loan growth, excluding the decline in Paycheck Protection Program (PPP) loans, totaled $65.3 million in the first quarter of 2022, representing a 12.8% annualized increase.
Total deposits of $2.18 billion at March 31, 2022 were up $63.3 million, or 3.0%, from December 31, 2021. Non-interest bearing demand deposits increased to 27.4% of total deposits at March 31, 2022, compared to 26.4% at December 31, 2021, while time deposits decreased to 15.1% at March 31, 2022 from 18.5% at December 31, 2021.
Asset quality metrics remained solid during the quarter, with net charge offs making up 0.05% of average loans on an annualized basis and nonperforming loans declining to 0.59% of total loans at March 31, 2022 from 0.62% at December 31, 2021.
Continued focus on managing expenses resulted in the fifth consecutive quarter of an efficiency ratioⁱⁱ below 50%, at 49.62% for the first quarter of 2022.
Tangible book value per shareⁱⁱⁱ of $12.79, up $0.12 from the end of the linked fourth quarter of 2021 and up $1.20 from March 31, 2021.

“Our first quarter performance was highlighted by strong earnings, continued organic loan growth, further enhancement of our deposit mix and solid asset quality metrics,” said Patrick L. Ryan, President and Chief Executive Officer. “Our team’s focus on expanding relationships with new and existing customers supported solid balance sheet expansion, with non-PPP loans up an annualized 12.8% and deposits up an annualized 12.1% from the linked fourth quarter. Organic loan growth was led by investor and owner-occupied commercial real estate lending, while our deposit mix continued to shift toward lower cost, non-time deposits.”

Mr. Ryan continued, “As expected, PPP loans and associated fees declined in the first quarter of 2022 as customers’ loans through this federal program continue to be forgiven. Offsetting this decline was strong organic loan growth in the fourth quarter of 2021 and first quarter of 2022, creating a larger average earning asset base. This loan growth, combined with our continued low funding costs, led to net interest income expansion for the quarter. We also saw an improvement in our net interest margin which was 3.43%, excluding PPP fees, in the first quarter of 2022 compared to 3.34% in the fourth quarter of 2021 and we see opportunity to improve the margin through rising asset yields. While non-interest revenues were softer in the first three months of the year, we believe this was partially a timing issue and remain optimistic about opportunities to expand U.S. Small Business Administration loan sale activity and continue to generate loan swap fee income. As we seek to drive continued revenue growth, we remain focused on effectively managing expenses, even as we respond to inflationary and competitive pressures to retain and recruit top talent in our markets.”

“Loan growth continues to come from high-quality customers and, accordingly, our asset quality metrics remain strong. Our nonperforming loans to total loans ratio improved during the quarter to 0.59%. Net charge-offs remain relatively low as annualized charge offs were 0.05% of average loans during the quarter ended March 31, 2022 and primarily related to one loan.”

“We are very pleased with our performance so far in 2022 and the opportunities we see ahead for continued growth. Our two newest branches, acquired in late 2021, continue to perform well and have led to some expanded customer relationships and with our robust lending pipelines, we believe we can continue to drive organic commercial loan growth. Our confidence is due in large part to the exceptional talent we have and continue to attract. We have been able to capitalize on market disruption, adding a number of relationship managers over the last several quarters from larger institutions that have already hit the ground running.”

“Our entire team is focused on maintaining our earnings and profitability strength as we seek to drive long-term shareholder value. As such, we were pleased to again announce a $0.06 quarterly dividend, reflecting an annualized yield of 1.68% based on our April 19, 2022 closing price.”

Income Statement

First Bank’s net interest income for the first quarter of 2022 was $21.1 million, an increase of $1.1 million, or 5.5%, compared to $20.0 million in the first quarter of 2021, due primarily to a $1.1 million decrease in total interest expense. The reduction in interest expense was primarily a result of a 46 basis point reduction in the average rate paid on time deposits, along with a decrease of $157.7 million in the average balance of time deposits. As a result of the Bank’s concerted effort to drive down deposit costs in a comparatively much lower interest rate environment, interest expense on all other interest bearing deposits also declined. Interest income was consistent with the year-ago quarter even with a lower level of PPP loan fees, as average loan growth of $93.7 million between the comparative periods was partially offset by a 20 basis point decline in the average loan yields. Impacting interest income from loans in the first quarter of 2022 was $860,000 in PPP loan fees compared to $1.6 million in the first quarter of 2021 and $1.1 million in the linked fourth quarter of 2021. Also impacting loan interest income in the first quarter of 2022 was loan prepayment income of $459,000, compared to $673,000 for the quarter ended March 31, 2021 and $312,000 for the quarter ended December 31, 2021.

The first quarter 2022 tax equivalent net interest margin was 3.57%, a modest decrease of three basis points compared to the prior year quarter and an increase of five basis points from the fourth quarter of 2021. The Bank’s margin continues to benefit from higher average non-interest bearing deposits and an overall lower cost of funds.

The Bank reported a provision for loan losses of $642,000 for the first quarter of 2022, compared to $1.1 million credit to the provision for loan losses in the first quarter of 2021 and a provision of $825,000 for the linked fourth quarter 2021. The provision for the quarter ended March 31, 2022 reflects consistent organic loan growth and continued strong asset quality.

First quarter 2022 non-interest income of $1.3 million compares to $2.3 million during the first quarter 2021. The decrease between the periods was primarily the result of a $497,000 decrease in gains on sale of loans reflecting lower U.S. Small Business Administration (SBA) loan sales, a $436,000 decrease in loan fees primarily reflecting lower loan swap fees in the first quarter 2022, and a $246,000 decrease in gains on the recovery of acquired loans.

Non-interest expense for first quarter 2022 of $11.1 million increased $472,000, or 4.4%, compared to $10.7 million for the prior year quarter. The higher non-interest expense compared to first quarter 2021 was primarily a result of a $776,000, or 13.5%, increase in salaries and employee benefits which was partially offset by reduced occupancy and equipment and legal fees. The increase in salaries and employee benefits was due primarily to merit-based salary compensation, a slightly higher number of total employees and increases in employee benefit costs.

On a linked quarter basis, first quarter 2022 non-interest expense decreased $703,000, or 5.9%, compared to $11.8 million for the fourth quarter of 2021, when the Bank recorded higher performance related compensation and merger-related expenses associated with our acquisition of two branches. Excluding merger-related expenses incurred in the fourth quarter of 2021, adjusted non-interest expense^iv decreased 1.8% between the comparable periods.

Income tax expense for the three months ended March 31, 2022 was $2.5 million with an effective tax rate of 23.4%, compared to $3.1 million with an effective tax rate of 24.2% for the first quarter of 2021 and $2.4 million with an effective tax rate of 23.2% for the fourth quarter of 2021.

Balance Sheet

Total assets at March 31, 2022 were $2.57 billion, an increase of $168.3 million, or 7.0%, compared to $2.41 billion at March 31, 2021 and $63.5 million, or 2.5%, from December 31, 2021, respectively. Total loans increased $129.6 million, or 6.4%, to $2.15 billion at March 31, 2022 compared to $2.02 billion at March 31, 2021. The increase in loans during the twelve month period ended March 31, 2022 reflects net non-PPP organic growth of $286.7 million and approximately $11.3 million in acquired loans, offset by a net decline in PPP loans of $168.4 million, as such loans continue to be forgiven. Total loans as of March 31, 2022 increased $39.8 million, or 1.9%, from $2.11 billion at December 31, 2021, reflecting organic, net non-PPP loan growth of $65.3 million, offset by a net decline in PPP loans of $25.5 million. PPP loans outstanding at March 31, 2022 were $25.5 million.

Total deposits were $2.18 billion at March 31, 2022, an increase of $207.4 million, or 10.5%, from $1.97 billion at March 31, 2021, and an increase of $63.3 million, or 3.0%, compared to $2.11 billion at December 31, 2021, respectively. Non-interest-bearing deposits totaled $597.3 million at March 31, 2022, an increase of $97.3 million, or 19.5%, from March 31, 2021, and an increase of $38.6 million, or 6.9%, from December 31, 2021. The Bank continues to focus on enhancing its deposit mix and, as of March 31, 2022, has grown non-interest bearing deposits to 27.4% and lowered time deposits to 15.1% of total deposits.

Stockholders’ equity was $271.1 million at March 31, 2022, compared to $266.7 million at December 31, 2021. The growth of $4.4 million, or 1.7%, was primarily a result of first quarter 2022 net income of $8.2 million, partially offset by a $3.2 million increase in accumulated other comprehensive loss and cash dividends paid of $1.2 million during the three months ended March 31, 2022. The increase in accumulated other comprehensive loss was due to an increase in unrealized losses on the Bank’s available for sale investment securities.

As of March 31, 2022, the Bank continued to exceed all regulatory capital requirements to be considered well capitalized, with a Tier 1 Leverage ratio of 10.15%, a Tier 1 Risk-Based capital ratio of 10.60%, a Common Equity Tier 1 Capital ratio of 10.60%, and a Total Risk-Based capital ratio of 12.86%.

Asset Quality

First Bank’s asset quality metrics remained stable and favorable during the three months ended March 31, 2022. Net charge offs of $247,000 for the first quarter of 2022 were 0.05% of average loans on an annualized basis. This compares to net recoveries of $5,000, or an annualized 0.00% of average loans, for the first quarter of 2021 and net charge offs of $6,000, or an annualized 0.00%, for the fourth quarter of 2021. Nonperforming loans were $12.6 million at March 31, 2022, up from $10.7 million on March 31, 2021, and down from $13.0 million at December 31, 2021. Nonperforming loans as a percentage of total loans at March 31, 2022 were 0.59%, compared with 0.53% at March 31, 2021 and 0.62% at December 31, 2021, respectively. The allowance for loan losses to nonperforming loans was 191.72% at March 31, 2022, compared with 214.74% at the end of first quarter 2021, and 182.65% at December 31, 2021, respectively.

COVID-19 Response

First Bank participated in the PPP, established by the Coronavirus Aid, Relief, and Economic Securities Act (CARES Act), during 2020 and 2021. The PPP was a specialized low-interest loan program funded by the U.S. Treasury Department and administered by the SBA. The PPP provided borrower guarantees for lenders, as well as loan forgiveness incentives for borrowers that utilized the loan proceeds to cover compensation and other business-related operating costs. The PPP ended on May 31, 2021 but the PPP loan forgiveness process is ongoing. As of March 31, 2022, First Bank had 205 PPP loans with outstanding balances of $25.5 million. During the quarter ended March 31, 2022, PPP loans totaling $25.5 million were forgiven and the Bank realized $860,000 in loan fees on these loans as any deferred fees remaining on the forgiven loans were accelerated. As of March 31, 2022, the Bank had $829,000 in remaining unamortized fees associated with outstanding balances of PPP loans.

First Bank continues to monitor and analyze its COVID-19 related financial hardship payment deferrals (COVID-19 deferrals). As of March 31, 2022, the Bank’s population of COVID-19 deferrals consisted of one loan totaling $222,000, or 0.00% of total loans, down from $1.6 million, or 0.08% of total loans, at December 31, 2021.

Cash Dividend Declared

On April 19, 2022, First Bank’s Board of Directors declared a quarterly cash dividend of $0.06 per share to common stockholders of record at the close of business on May 13, 2022, payable on May 27, 2022.

Conference Call

First Bank will host its earnings call on Tuesday, April 26, 2022 at 9:00 AM eastern time. The direct dial toll free number for the live call is 1-844-200-6205 and the access code is 794535. For those unable to participate in the call, a replay will be available by dialing 1-866-813-9403 (access code 750010) from one hour after the end of the conference call until July 25, 2022. Replay information will also be available on First Bank’s website at www.firstbanknj.com under the “About Us” tab. Click on “Investor Relations” to access the replay of the conference call.

About First Bank

First Bank is a New Jersey state-chartered bank with 18 full-service branches in Cinnaminson, Cranbury, Delanco, Denville, Ewing, Flemington (2), Hamilton, Lawrence, Monroe, Pennington, Randolph, Somerset and Williamstown, New Jersey; and Doylestown, Trevose, Warminster and West Chester, Pennsylvania. With $2.6 billion in assets as of March 31, 2022, First Bank offers a full range of deposit and loan products to individuals and businesses throughout the New York City to Philadelphia corridor. First Bank's common stock is listed on the Nasdaq Global Market under the symbol “FRBA.”

Forward Looking Statements

This press release contains certain forward-looking statements, either express or implied, within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include information regarding First Bank’s future financial performance, business and growth strategy, projected plans and objectives, and related transactions, integration of acquired businesses, ability to recognize anticipated operational efficiencies, and other projections based on macroeconomic and industry trends, which are inherently unreliable due to the multiple factors that impact economic trends, and any such variations may be material. Such forward-looking statements are based on various facts and derived utilizing important assumptions, current expectations, estimates and projections about First Bank, any of which may change over time and some of which may be beyond First Bank’s control. Statements preceded by, followed by or that otherwise include the words “believes,” “expects,” “anticipates,” “intends,” “projects,” “estimates,” “plans” and similar expressions or future or conditional verbs such as “will,” “should,” “would,” “may” and “could” are generally forward-looking in nature and not historical facts, although not all forward-looking statements include the foregoing. Further, certain factors that could affect our future results and cause actual results to differ materially from those expressed in the forward-looking statements include, but are not limited to: whether First Bank can: successfully implement its growth strategy, including identifying acquisition targets and consummating suitable acquisitions, sustain its internal growth rate, and provide competitive products and services that appeal to its customers and target markets; difficult market conditions and unfavorable economic trends in the United States generally, and particularly in the market areas in which First Bank operates and in which its loans are concentrated, including the effects of declines in housing market values; the impact of disease pandemics, including COVID-19, on First Bank, its operations and its customers and employees; an increase in unemployment levels and slowdowns in economic growth; First Bank's level of nonperforming assets and the costs associated with resolving any problem loans including litigation and other costs; changes in market interest rates may increase funding costs and reduce earning asset yields thus reducing margin; the impact of changes in interest rates and the credit quality and strength of underlying collateral and the effect of such changes on the market value of First Bank's investment securities portfolio; the extensive federal and state regulation, supervision and examination governing almost every aspect of First Bank's operations, including changes in regulations affecting financial institutions and expenses associated with complying with such regulations; uncertainties in tax estimates and valuations, including due to changes in state and federal tax law; First Bank's ability to comply with applicable capital and liquidity requirements, including First Bank’s ability to generate liquidity internally or raise capital on favorable terms, including continued access to the debt and equity capital markets; and possible changes in trade, monetary and fiscal policies, laws and regulations and other activities of governments, agencies, and similar organizations. For discussion of these and other risks that may cause actual results to differ from expectations, please refer to “Forward-Looking Statements” and “Risk Factors” in First Bank’s Annual Report on Form 10-K and any updates to those risk factors set forth in First Bank’s proxy statement, subsequent Quarterly Reports on Form 10-Q or Current Reports on Form 8-K. If one or more events related to these or other risks or uncertainties materialize, or if First Bank’s underlying assumptions prove to be incorrect, actual results may differ materially from what First Bank anticipates. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and First Bank does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise. All forward-looking statements, expressed or implied, included in this communication are expressly qualified in their entirety by this cautionary statement. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that First Bank or persons acting on First Bank’s behalf may issue.

ⁱ Return on average tangible equity is a non-U.S. GAAP financial measure and is calculated by dividing net income by average tangible equity (average equity minus average goodwill and other intangible assets). For a reconciliation of this non-U.S. GAAP financial measure, along with the other non-U.S. GAAP financial measures in this press release, to their comparable U.S. GAAP measures, see the financial reconciliations at the end of this press release.

ⁱⁱ The efficiency ratio is a non-U.S. GAAP financial measure and is calculated by dividing non-interest expense less merger-related expenses by adjusted total revenue (net interest income plus non-interest income). For a reconciliation of this non-U.S. GAAP financial measure, along with the other non-U.S. GAAP financial measures in this press release, to their comparable U.S. GAAP measures, see the financial reconciliations at the end of this press release.

ⁱⁱⁱ Tangible book value per share is a non-U.S. GAAP financial measure and is calculated by dividing common shares outstanding by tangible equity (equity minus goodwill and other intangible assets). For a reconciliation of this non-U.S. GAAP financial measure, along with the other non-U.S. GAAP financial measures in this press release, to their comparable U.S. GAAP measures, see the financial reconciliations at the end of this press release.

^iv Adjusted non-interest expense is a non-U.S. GAAP financial measure and is calculated by subtracting merger-related expenses from total non-interest expense. For a reconciliation of this non-U.S. GAAP financial measure, along with the other non-U.S. GAAP financial measures in this press release, to their comparable U.S. GAAP measures, see the financial reconciliations at the end of this press release.

FIRST BANK AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(in thousands, except for share data, unaudited)


			March 31, 2022			December 31, 2021
Assets
Cash and due from banks			$	32,531		$	25,076
Interest bearing deposits with banks				149,726			129,431
		Cash and cash equivalents		182,257			154,507
Interest bearing time deposits with banks				1,740			2,170
Investment securities available for sale, at fair value				86,622			94,584
Investment securities held to maturity (fair value of $40,112
	at March 31, 2022 and $39,718 at December 31, 2021)			41,468			39,547
Restricted investment in bank stocks				5,517			5,856
Other investments				8,078			8,062
Loans, net of deferred fees and costs				2,151,751			2,111,991
	Less: Allowance for loan losses			24,140			23,746
		Net loans		2,127,611			2,088,245
Premises and equipment, net				9,774			9,883
Other real estate owned, net				293			772
Accrued interest receivable				5,796			5,681
Bank-owned life insurance				57,006			56,633
Goodwill				17,826			17,826
Other intangible assets, net				2,028			2,145
Deferred income taxes				12,106			11,081
Other assets				15,723			13,306
		Total assets	$	2,573,845		$	2,510,298

Liabilities and Stockholders' Equity
Liabilities:
Non-interest bearing deposits			$	597,333		$	558,775
Interest bearing deposits				1,580,562			1,555,827
		Total deposits		2,177,895			2,114,602
Borrowings				74,306			81,835
Subordinated debentures				29,647			29,620
Accrued interest payable				799			399
Other liabilities				20,130			17,176
		Total liabilities		2,302,777			2,243,632
Stockholders' Equity:
Preferred stock, par value $2 per share; 10,000,000 shares authorized;
	no shares issued and outstanding			-			-
Common stock, par value $5 per share; 40,000,000 shares authorized; 21,014,086
	shares issued and 19,634,744 shares outstanding at March 31, 2022 and
	20,851,506 shares issued and 19,472,364 shares outstanding at December 31, 2021			104,138			103,704
Additional paid-in capital				79,757			79,563
Retained earnings				102,914			95,924
Accumulated other comprehensive loss				(3,420	)		(206	)
Treasury stock, 1,379,342 shares at March 31, 2022 and 1,379,142 shares
	at December 31, 2021			(12,321	)		(12,319	)
		Total stockholders' equity		271,068			266,666
		Total liabilities and stockholders' equity	$	2,573,845		$	2,510,298

FIRST BANK AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except for share data, unaudited)


		Three Months Ended
		March 31,
			2022		2021
Interest and Dividend Income
Investment securities—taxable		$	576	$	475
Investment securities—tax-exempt			37		48
Interest bearing deposits with banks,
Federal funds sold and other			130		171
Loans, including fees			22,143		22,157
	Total interest and dividend income		22,886		22,851

Interest Expense
Deposits			1,009		1,850
Borrowings			288		514
Subordinated debentures			440		440
	Total interest expense		1,737		2,804
Net interest income			21,149		20,047
Provision for loan losses			642		(1,053	)
	Net interest income after provision for loan losses		20,507		21,100

Non-Interest Income
Service fees on deposit accounts			252		176
Loan fees			245		681
Income from bank-owned life insurance			373		329
Gains on sale of loans			37		534
Gains on recovery of acquired loans			124		370
Other non-interest income			236		210
	Total non-interest income		1,267		2,300

Non-Interest Expense
Salaries and employee benefits			6,544		5,768
Occupancy and equipment			1,424		1,938
Legal fees			142		247
Other professional fees			687		531
Regulatory fees			193		268
Directors' fees			218		216
Data processing			596		535
Marketing and advertising			164		188
Travel and entertainment			88		15
Insurance			165		154
Other real estate owned expense, net			83		51
Other expense			818		739
	Total non-interest expense		11,122		10,650
Income Before Income Taxes			10,652		12,750
Income tax expense			2,494		3,089
Net Income		$	8,158	$	9,661

Basic earnings per common share		$	0.42	$	0.49
Diluted earnings per common share		$	0.41	$	0.49
Cash dividends per common share		$	0.06	$	0.03

Basic weighted average common shares outstanding			19,532,811		19,672,017
Diluted weighted average common shares outstanding			19,768,452		19,834,319

FIRST BANK AND SUBSIDIARIES
AVERAGE BALANCE SHEETS WITH INTEREST AND AVERAGE RATES
(dollars in thousands, unaudited)


	Three Months Ended March 31,
		2022								2021
	Average						Average		Average						Average
	Balance			Interest			Rate (5)		Balance			Interest			Rate (5)
Interest earning assets
Investment securities (1) (2)	$	134,033		$	621		1.88	%	$	97,756		$	533		2.21	%
Loans (3)		2,131,014			22,143		4.21	%		2,037,318			22,157		4.41	%
Interest bearing deposits with banks,
Federal funds sold and other		121,422			50		0.17	%		108,793			69		0.26	%
Restricted investment in bank stocks		5,616			63		4.55	%		8,447			87		4.18	%
Other investments		8,073			17		0.85	%		6,510			15		0.93	%
Total interest earning assets(2)		2,400,158			22,894		3.87	%		2,258,824			22,861		4.10	%
Allowance for loan losses		(24,057	)							(24,600	)
Non-interest earning assets		146,674								132,193
Total assets	$	2,522,775							$	2,366,417

Interest bearing liabilities
Interest bearing demand deposits	$	298,274		$	61		0.08	%	$	201,247		$	65		0.13	%
Money market deposits		706,368			448		0.26	%		591,752			520		0.36	%
Savings deposits		190,222			164		0.35	%		168,993			204		0.49	%
Time deposits		350,223			336		0.39	%		507,949			1,061		0.85	%
Total interest bearing deposits		1,545,087			1,009		0.26	%		1,469,941			1,850		0.51	%
Borrowings		76,492			288		1.53	%		145,632			514		1.43	%
Subordinated debentures		29,632			440		5.94	%		29,519			440		5.96	%
Total interest bearing liabilities		1,651,211			1,737		0.43	%		1,645,092			2,804		0.69	%
Non-interest bearing deposits		583,543								464,157
Other liabilities		17,874								15,494
Stockholders' equity		270,147								241,674
Total liabilities and stockholders' equity	$	2,522,775							$	2,366,417
Net interest income/interest rate spread (2)					21,157		3.44	%					20,057		3.41	%
Net interest margin (2) (4)							3.57	%							3.60	%
Tax equivalent adjustment (2)					(8	)							(10	)
Net interest income				$	21,149							$	20,047

(1) Average balance of investment securities available for sale is based on amortized cost.
(2) Interest and average rates are presented on a tax equivalent basis using a federal income tax rate of 21%.
(3) Average balances of loans include loans on nonaccrual status.
(4) Net interest income divided by average total interest earning assets.
(5) Annualized.

FIRST BANK AND SUBSIDIARIES
QUARTERLY FINANCIAL HIGHLIGHTS
(in thousands, except for share and employee data, unaudited)

	As of or For the Quarter Ended
	3/31/2022			12/31/2021			9/30/2021			6/30/2021			3/31/2021
EARNINGS
Net interest income	$	21,149		$	20,641		$	20,781		$	20,421		$	20,047
Provision for loan losses		642			825			158			(162	)		(1,053	)
Non-interest income		1,267			2,211			1,901			1,342			2,300
Non-interest expense		11,122			11,825			10,522			10,155			10,650
Income tax expense		2,494			2,363			2,966			2,877			3,089
Net income		8,158			7,839			9,036			8,893			9,661

PERFORMANCE RATIOS
Return on average assets (1)		1.31	%		1.27	%		1.46	%		1.48	%		1.66	%
Adjusted return on average assets (1) (2)		1.31	%		1.33	%		1.48	%		1.48	%		1.66	%
Return on average equity (1)		12.25	%		11.77	%		13.86	%		14.26	%		16.21	%
Adjusted return on average equity (1) (2)		12.25	%		12.36	%		14.04	%		14.26	%		16.21	%
Return on average tangible equity (1) (2)		13.22	%		12.63	%		14.90	%		15.37	%		17.52	%
Adjusted return on average tangible equity (1) (2)		13.22	%		13.26	%		15.09	%		15.37	%		17.52	%
Net interest margin (1) (3)		3.57	%		3.52	%		3.54	%		3.57	%		3.60	%
Total cost of deposits (1)		0.19	%		0.21	%		0.25	%		0.30	%		0.39	%
Efficiency ratio (2)		49.62	%		49.57	%		45.75	%		46.66	%		47.66	%

SHARE DATA
Common shares outstanding		19,634,744			19,472,364			19,464,388			19,678,528			19,663,065
Basic earnings per share	$	0.42		$	0.40		$	0.46		$	0.45		$	0.49
Diluted earnings per share		0.41			0.40			0.46			0.45			0.49
Adjusted diluted earnings per share (2)		0.41			0.42			0.46			0.45			0.49
Tangible book value per share (2)		12.79			12.67			12.45			12.02			11.59
Book value per share		13.81			13.69			13.37			12.94			12.51

MARKET DATA
Market value per share	$	14.22		$	14.51		$	14.09		$	13.54		$	12.17
Market value / Tangible book value		111.14	%		114.53	%		113.21	%		112.61	%		104.97	%
Market capitalization	$	279,206		$	282,544		$	274,253		$	266,447		$	239,300

CAPITAL & LIQUIDITY
Tangible stockholders' equity / tangible assets (2)		9.84	%		9.91	%		10.01	%		9.76	%		9.55	%
Stockholders' equity / assets		10.53	%		10.62	%		10.67	%		10.42	%		10.23	%
Loans / deposits		98.80	%		99.88	%		97.96	%		100.87	%		102.62	%

ASSET QUALITY
Net charge-offs (recoveries)	$	247		$	6		$	(121	)	$	116		$	(5	)
Nonperforming loans		12,591			13,001			11,488			9,558			10,676
Nonperforming assets		12,884			13,773			11,967			10,038			11,251
Netcharge offs (recoveries) / average loans (1)		0.05	%		0.00	%		(0.02	%)		0.02	%		0.00	%
Nonperforming loans / total loans		0.59	%		0.62	%		0.57	%		0.47	%		0.53	%
Nonperforming assets / total assets		0.50	%		0.55	%		0.49	%		0.41	%		0.47	%
Allowance for loan losses / total loans		1.12	%		1.12	%		1.14	%		1.10	%		1.13	%
Allowance for loan losses / total loans (excluding PPP loans)		1.13	%		1.15	%		1.19	%		1.18	%		1.24	%
Allowance for loan losses / nonperforming loans		191.72	%		182.65	%		199.57	%		236.95	%		214.74	%

OTHER DATA
Total assets	$	2,573,845		$	2,510,298		$	2,438,020		$	2,443,047		$	2,405,576
Total loans		2,151,751			2,111,991			2,004,289			2,053,938			2,022,187
Total deposits		2,177,895			2,114,602			2,045,966			2,036,228			1,970,491
Total stockholders' equity		271,068			266,666			260,179			254,571			245,997
Number of full-time equivalent employees		219			217			209			215			211

(1) Annualized.
(2) Non-U.S. GAAP financial measure that we believe provides management and investors with information that is useful in understanding our financial performance and condition. See accompanying table, "Non-U.S. GAAP Financial Measures," for calculation and reconciliation.
(3) Tax equivalent using a federal income tax rate of 21%.

FIRST BANK AND SUBSIDIARIES
QUARTERLY FINANCIAL HIGHLIGHTS
(dollars in thousands, unaudited)

		As of the Quarter Ended
		3/31/2022			12/31/2021			9/30/2021			6/30/2021			3/31/2021
LOAN COMPOSITION
Commercial and industrial		$	321,979		$	350,103		$	308,991		$	379,916		$	432,869
Commercial real estate:
	Owner-occupied		493,999			470,022			444,635			427,094			399,042
	Investor		888,622			848,021			832,727			814,762			771,599
	Construction and development		96,585			109,292			112,112			127,329			123,930
	Multi-family		193,865			173,728			145,245			142,015			125,493
	Total commercial real estate		1,673,071			1,601,063			1,534,719			1,511,200			1,420,064
Residential real estate:
	Residential mortgage and first lien home equity loans		99,992			106,204			103,890			108,842			117,756
	Home equity–second lien loans and revolving lines of credit		30,485			31,375			29,998			29,422			29,306
	Total residential real estate		130,477			137,579			133,888			138,264			147,062
Consumer and other			30,096			27,762			31,946			31,584			29,213
	Total loans prior to deferred loan fees and costs		2,155,623			2,116,507			2,009,544			2,060,964			2,029,208
Net deferred loan fees and costs			(3,872	)		(4,516	)		(5,255	)		(7,026	)		(7,021	)
	Total loans	$	2,151,751		$	2,111,991		$	2,004,289		$	2,053,938		$	2,022,187

LOAN MIX
Commercial and industrial			15.0	%		16.6	%		15.4	%		18.5	%		21.4	%
Commercial real estate:
	Owner-occupied		23.0	%		22.3	%		22.2	%		20.8	%		19.7	%
	Investor		41.3	%		40.1	%		41.5	%		39.7	%		38.2	%
	Construction and development		4.5	%		5.2	%		5.6	%		6.2	%		6.1	%
	Multi-family		9.0	%		8.2	%		7.2	%		6.9	%		6.2	%
	Total commercial real estate		77.8	%		75.8	%		76.5	%		73.5	%		70.2	%
Residential real estate:
	Residential mortgage and first lien home equity loans		4.6	%		5.0	%		5.2	%		5.3	%		5.8	%
	Home equity–second lien loans and revolving lines of credit		1.4	%		1.5	%		1.5	%		1.4	%		1.4	%
	Total residential real estate		6.1	%		6.5	%		6.7	%		6.7	%		7.2	%
Consumer and other			1.4	%		1.4	%		1.7	%		1.6	%		1.5	%
Net deferred loan fees and costs			(0.2	%)		(0.3	%)		(0.3	%)		(0.3	%)		(0.3	%)
	Total loans		100.0	%		100.0	%		100.0	%		100.0	%		100.0	%

FIRST BANK AND SUBSIDIARIES
QUARTERLY FINANCIAL HIGHLIGHTS
(dollars in thousands, unaudited)

		As of the Quarter Ended
		3/31/2022			12/31/2021			9/30/2021			6/30/2021			3/31/2021
DEPOSIT COMPOSITION
Non-interest bearing demand deposits		$	597,333		$	558,775		$	536,905		$	534,475		$	500,008
Interest bearing demand deposits			314,564			293,647			241,869			211,074			208,443
Money market and savings deposits			936,848			871,074			845,607			817,424			767,603
Time deposits			329,150			391,106			421,585			473,255			494,437
	Total Deposits	$	2,177,895		$	2,114,602		$	2,045,966		$	2,036,228		$	1,970,491

DEPOSIT MIX
Non-interest bearing demand deposits			27.4	%		26.4	%		26.3	%		26.3	%		25.4	%
Interest bearing demand deposits			14.5	%		13.9	%		11.8	%		10.4	%		10.6	%
Money market and savings deposits			43.0	%		41.2	%		41.3	%		40.1	%		38.9	%
Time deposits			15.1	%		18.5	%		20.6	%		23.2	%		25.1	%
	Total Deposits		100.0	%		100.0	%		100.0	%		100.0	%		100.0	%

FIRST BANK AND SUBSIDIARIES
NON-U.S. GAAP FINANCIAL MEASURES
(in thousands, except for share data, unaudited)

	As of or For the Quarter Ended
	3/31/2022			12/31/2021			9/30/2021			6/30/2021			3/31/2021
Return on Average Tangible Equity
Net income (numerator)	$	8,158		$	7,839		$	9,036		$	8,893		$	9,661

Average stockholders' equity	$	270,147		$	264,216		$	258,596		$	250,143		$	241,674
Less: Average Goodwill and other intangible assets, net		19,916			17,910			17,937			18,001			18,023
Average Tangible stockholders' equity (denominator)	$	250,231		$	246,306		$	240,659		$	232,142		$	223,651

Return on Average Tangible equity (1)		13.22	%		12.63	%		14.90	%		15.37	%		17.52	%

Tangible Book Value Per Share
Stockholders' equity	$	271,068		$	266,666		$	260,179		$	254,571		$	245,997
Less: Goodwill and other intangible assets, net		19,854			19,971			17,920			17,965			18,024
Tangible stockholders' equity (numerator)	$	251,214		$	246,695		$	242,259		$	236,606		$	227,973

Common shares outstanding (denominator)		19,634,744			19,472,364			19,464,388			19,678,528			19,663,065

Tangible book value per share	$	12.79		$	12.67		$	12.45		$	12.02		$	11.59


Tangible Equity / Assets
Stockholders' equity	$	271,068		$	266,666		$	260,179		$	254,571		$	245,997
Less: Goodwill and other intangible assets, net		19,854			19,971			17,920			17,965			18,024
Tangible stockholders' equity (numerator)	$	251,214		$	246,695		$	242,259		$	236,606		$	227,973

Total assets	$	2,573,845		$	2,510,298		$	2,438,020		$	2,443,047		$	2,405,576
Less: Goodwill and other intangible assets, net		19,854			19,971			17,920			17,965			18,024
Tangible total assets (denominator)	$	2,553,991		$	2,490,327		$	2,420,100		$	2,425,082		$	2,387,552

Tangible stockholders' equity / tangible assets		9.84	%		9.91	%		10.01	%		9.76	%		9.55	%


Efficiency Ratio
Non-interest expense	$	11,122		$	11,825		$	10,522		$	10,155		$	10,650
Less: Merger-related expenses		-			498			145			-			-
Adjusted non-interest expense (numerator)	$	11,122		$	11,327		$	10,377		$	10,155		$	10,650

Net interest income	$	21,149		$	20,641		$	20,781		$	20,421		$	20,047
Non-interest income		1,267			2,211			1,901			1,342			2,300
Total revenue	$	22,416		$	22,852		$	22,682		$	21,763		$	22,347

Efficiency ratio		49.62	%		49.57	%		45.75	%		46.66	%		47.66	%

(1) Annualized.

FIRST BANK AND SUBSIDIARIES
NON-U.S. GAAP FINANCIAL MEASURES
(dollars in thousands, except for share data, unaudited)


	For the Quarter Ended
	3/31/2022			12/31/2021			9/30/2021			6/30/2021			3/31/2021

Adjusted diluted earnings per share,
Adjusted return on average assets, and
Adjusted return on average equity

Net income	$	8,158		$	7,839		$	9,036		$	8,893		$	9,661
Add: Merger-related expenses⁽¹⁾		-			393			115			-			-
Adjusted net income	$	8,158		$	8,232		$	9,151		$	8,893		$	9,661

Diluted weighted average common shares outstanding		19,768,452			19,725,294			19,842,817			19,883,076			19,834,319
Average assets	$	2,522,775		$	2,447,399		$	2,456,617		$	2,410,353		$	2,366,417
Average equity	$	270,147		$	264,216		$	258,596		$	250,143		$	241,674
Average Tangible Equity	$	250,231		$	246,306		$	240,659		$	232,142		$	223,651

Adjusted diluted earnings per share	$	0.41		$	0.42		$	0.46		$	0.45		$	0.49
Adjusted return on average assets⁽²⁾		1.31	%		1.33	%		1.48	%		1.48	%		1.66	%
Adjusted return on average equity⁽²⁾		12.25	%		12.36	%		14.04	%		14.26	%		16.21	%
Adjusted return on average tangible equity⁽²⁾		13.22	%		13.26	%		15.09	%		15.37	%		17.52	%

(1) Items are tax-effected using a federal income tax rate of 21%.
(2) Annualized.

CONTACT: Patrick L. Ryan, President and CEO
(609) 643-0168, patrick.ryan@firstbanknj.com

First Bank Reports First Quarter 2022 Net Income of $8.2 Million

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