PATRIOT NATIONAL BANCORP INC
For the period ended Sep 30, 2025. Filed Nov 14, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Nov 14, 2025
PNBK$0.84+2.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-08-14.
0001628280-25-040370
Item 2. : Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-11-14.
0001628280-25-052358
Item 2. : Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 189 previous paragraphs and 198 current paragraphs.
109 unchanged; 76 reworded; 10 added; 4 removed; 0 previous and 3 current paragraphs rearranged.
Tables are not compared: 14 previous and 14 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (10)
Current report
On August 29, 2025, the Company entered into a stock purchase agreement and a separate warrant purchase agreement with certain accredited investors, pursuant to which the Company agreed to issue and sell, in a registered direct offering by the Company directly to the Investors (the “Offering”), an aggregate of 31,985,103 shares of the Company’s common stock, $0.01 par value per share (the “Shares” or the “Common Stock”). The Shares consist of (a) 19,196,000 shares of the Company’s voting Common Stock (“Voting Common Stock”), and (b) 12,789,103 shares of the Company’s non-voting Common Stock (the “Non-Voting Common Stock”) that will be issuable six months after closing of the Offering upon exercise of three-year warrants (the “Warrants”). Upon such Warrant holders or their assignees meeting certain conditions (the “Non-Control Conditions”), the Non-Voting Common Stock may be exchanged for shares of Voting Common Stock. The Shares will be sold to the Investors at a price per share of $1.25 per Share and the Warrants will be sold to Investors at a price of $0.125 per warrant share. The Warrants are exercisable no earlier than six months after the closing of the Offering at an exercise price of $1.56 per share, subject to increase to as much as $1.685 per share under certain conditions. The proceeds from the Offering, prior to deducting the estimated offering expenses, are expected to be approximately $25.6 million. Estimated offering expenses are $250,000.
Current report
Conversions
Current report
On July 3, 2025, the Company converted all outstanding shares of Series A Preferred Stock into 7,266,560 shares of Non-Voting Common Stock.
Current report
As of September 30, 2025 and December 31, 2024, forty-two out of forty-six and 44 out of 44, respectively, available-for-sale securities had unrealized losses with an aggregate decline of 15.6% and 20.2% from the amortized cost of those securities, respectively.
Current report
The Company is currently assessing the tax basis treatment of its loan servicing assets in consultation with its tax advisors. Preliminary analysis indicates that, under current tax regulations, no tax basis may be recognized for these assets, which could give rise to a deferred tax liability. The Company is evaluating whether a change in accounting method is required and expects to complete its assessment prior to year-end. Any resulting adjustment will be reflected in the period the evaluation is finalized.
Current report
On September 4, 2025, the remaining principal balance of the Senior Notes were repaid in full.
Current report
For the three and nine months ended September 30, 2025, the Company recognized interest expense of $0.1 million and $0.6 million, respectively. Interest expense incurred for the three and nine months ended September 30, 2024 was $0.3 million and $0.9 million, respectively.
Current report
For the three and nine months ended September 30, 2025, the Company recognized interest expense of $0.2 million and $0.5 million, respectively. Interest expense incurred for the three and nine months ended September 30, 2024 was $0.2 million and 0.7 million, respectively.
Current report
For the three and nine months ended September 30, 2025, the Company recognized interest expense of $0.2 million and $0.5 million, respectively. Interest expense incurred for the three and nine months ended September 30, 2024 was $0.2 million and 0.5 million, respectively.
Current report
On January 17, 2025, the OCC notified the Bank that, in connection with the entry into the OCC Agreement, the individual minimum capital ratios previously established on April 17, 2024 for the Bank has been terminated. The same minimum capital ratios were re-established within the OCC Agreement under its Capital Plan and Higher Minimums Articles so that all capital requirements are governed by the OCC Agreement. Under these provisions, the Bank must maintain, on an ongoing basis, a common equity tier 1 capital ratio of 10.00%, a Tier 1 capital ratio of 10.00%, a Tier 1 leverage ratio of 9.00% and a total capital ratio of 11.50%.
Removed paragraphs (4)
Previous report
Note Conversions
Previous report
For the three and six months ended June 30, 2025, the Company recognized interest expense of $183,000 and $505,000, respectively. Interest expense incurred for the three and six months ended June 30, 2024 was $289,000 and $579,000, respectively.
Previous report
For the three and six months ended June 30, 2025, the Company recognized interest expense of $164,000 and $377,000, respectively. Interest expense incurred for the three and six months ended June 30, 2024 was $224,000 and $451,000, respectively.
Previous report
For the three and six months ended June 30, 2025, the Company recognized interest expense of $163,000 and $325,000, respectively. Interest expense incurred for the three and six months ended June 30, 2024 was $180,000 and $359,000, respectively.
Reworded paragraphs (76)
Previous wording
(1)We are operating under a formal agreement with the OCC requiring our Board of Directors to implement enhancements in strategic planning, capital planning, BSA/AML compliance, payment activities oversight, credit administration, and concentration risk management. The agreement reflects the OCC’s supervisory view that our controls in these areas must be strengthened. Failure to meet the agreement’s requirements on a timely basis could result in additional regulatory actions or restrictions, which could adversely affect our operations and financial condition.
Current wording
(1)We are operating under a formal agreement with the Office of the Comptroller of the Currency (“OCC”) requiring our Board of Directors to implement enhancements in strategic planning, capital planning, Bank Secrecy Act/Anti-Money Laundering compliance, payment activities oversight, credit administration, and concentration risk management. The agreement reflects the OCC’s supervisory view that our controls in these areas must be strengthened. Failure to meet the agreement’s requirements on a timely basis could result in additional regulatory actions or restrictions, which could adversely affect our operations and financial condition.
Previous wording
(2)Our Digital Payments Division relies on third-party program managers and processors to operate programs under our BINs. Because certain transactions occur through their systems, our visibility and direct control over all activities may be limited. This structure increases our exposure to fraud, compliance failures, and operational issues by third parties, which could result in financial losses, regulatory action, network penalties, and reputational harm.
Current wording
(2)Our Digital Payments Division relies on third-party program managers and processors to operate programs under our Bank Identification Numbers. Because certain transactions occur through their systems, our visibility and direct control over all activities may be limited. This structure increases our exposure to fraud, compliance failures, and operational issues by third parties, which could result in financial losses, regulatory action, network penalties, and reputational harm.
Previous wording
(18)changes in the level and direction of loan delinquencies and write-offs and changes in estimates of the adequacy of the allowance for c losses;
Current wording
(18)changes in the level and direction of loan delinquencies and write-offs and changes in estimates of the adequacy of the allowance for credit losses;
Previous wording
(28)the premiums paid for the guaranteed portion of SBA loans by third party investors;
Current wording
(28)the premiums paid for the guaranteed portion of U.S. Small Business Administration (“SBA”) loans by third party investors;
Previous wording
The Company reported net loss of $5.0 million ($0.06 basic and diluted loss per share) for the quarter ended June 30, 2025, compared to a net loss of $3.1 million ($0.77 basic and diluted loss per share) for the quarter ended June 30, 2024.
Current wording
The Company reported net loss of $2.7 million or $0.03 basic and diluted loss per share for the quarter ended September 30, 2025, compared to a net loss of $27.0 million or $6.78 basic and diluted loss per share for the quarter ended September 30, 2024.
Previous wording
For the six months ended June 30, 2025, the net loss was $7.8 million, or $0.17 basic and diluted loss per share, compared to a net loss of $3.4 million, ($0.85 basic and diluted loss per share) for the six months ended June 30, 2024. This represents a year-over-year increase in net loss of $4.4 million.
Current wording
For the nine months ended September 30, 2025, the net loss was $10.4 million, or $0.16 basic and diluted loss per share, compared to a net loss of $30.3 million, or $7.63 basic and diluted loss per share for the nine months ended September 30, 2024. This represents a year-over-year decrease in net loss of $19.9 million.
Previous wording
For the three and six months ended June 30, 2025, net interest income declined $835,000 and $2.3 million, compared to the three and six months ended June 30, 2024, respectively, due to an intentional decline in loan balances. The Company reported a decrease in gross loans of $119.9 million in 2025, from $707.5 million at December 31, 2024 to $587.5 million at June 30, 2025. The Company has continued the trend of restricting loan growth and allowing loans to pay down as the balance sheet is reduced in order to strengthen capital ratios.
Current wording
For the three months ended September 30, 2025, net interest income increased $11,000 compared to the three months ended September 30, 2024. For the nine months ended September 30, 2025, net interest income decreased $2.3 million, compared to the nine months ended September 30, 2024, due to an intentional decline in loan balances. The Company reported a decrease in gross loans of $118.8 million in 2025, from $707.5 million at December 31, 2024 to $588.7 million at September 30, 2025. The Company has continued the trend of restricting loan growth and allowing loans to pay down as the balance sheet is reduced in order to strengthen capital ratios.
Previous wording
On March 20, 2025, the Company entered into (i) securities purchase agreements (the “Co-Lead Investors Agreements”) with its President and director, Steven Sugarman, and three co-lead investors, and (ii) securities purchase agreements with other accredited investors (collectively, and together with the Co-Lead Investors and the Lead Party, the “Purchasers”).
Current wording
On March 20, 2025, the Company entered into (i) securities purchase agreements with its President and director, Steven Sugarman, and three co-lead investors, and (ii) securities purchase agreements with other accredited investors (collectively, and together with the Co-Lead Investors and the Lead Party).
Previous wording
Also on March 20, 2025, the Company completed a $57.8 million private placement of: (i) shares of the Company’s common stock, par value 0.01 per share (“Common Stock”), at a purchase price of $0.75 per share, and (ii) shares of a new series of the Company’s preferred stock, no par value per share, designated as Series A Non-Cumulative Perpetual Convertible Preferred Stock (the “Series A Preferred Stock”), with a liquidation preference of $60 per share (the “Private Placement”).
Current wording
In addition, on March 20, 2025, the Company completed a $57.8 million private placement of: (i) shares of the Company’s common stock, par value 0.01 per share (“Common Stock”), at a purchase price of $0.75 per share, and (ii) shares of a new series of the Company’s preferred stock, no par value per share, designated as Series A Non-Cumulative Perpetual Convertible Preferred Stock (the “Series A Preferred Stock”), with a liquidation preference of $60 per share (the “Private Placement”).
Previous wording
On July 5, 2025, the Company completed its registered direct offering of 8,524,160 shares of its common stock at a purchase price of $1.25 per share, raising gross proceeds of $10,655,200.
Current wording
On June 3, 2025, the Company completed its registered direct offering of 8,524,160 shares of its common stock at a purchase price of $1.25 per share, raising gross proceeds of $10.7 million.
Previous wording
As of June 30, 2025, the Private Placement results in capital ratios that are in excess of the minimums required by the OCC Agreement.
Current wording
As of September 30, 2025, the Private Placement and Registered Direct Offerings results in capital ratios that are in excess of the minimums required by the OCC Agreement.
Previous wording
Total assets decreased $82.3 million to $930.0 million as of June 30, 2025, compared to $1.01 billion at December 31, 2024, primarily due to the decline in gross loans receivable of $119.9 million, partially offset by a $40.4 million increase in cash, cash equivalents and restricted cash as of June 30, 2025.
Current wording
Total assets decreased $61.5 million to $950.8 million as of September 30, 2025, compared to $1.01 billion at December 31, 2024, primarily due to the decline in gross loans receivable of $118.8 million, partially offset by a $38.9 million increase in cash, cash equivalents and restricted cash as of September 30, 2025.
Previous wording
Cash, cash equivalents and restricted cash increased from $162.6 million at December 31, 2024 to $203.0 million at June 30, 2025. The increase in 2025 was primarily driven by loan repayments and sale of loan receivable, and cash proceeds from issuance of common and preferred stock shares, partially offset by a $135.7 million reduction in deposits. Following the completion of the Private Placement, the Company reduced excess cash by lowering deposits. For further details, refer to the Consolidated Statements of Cash Flows.
Current wording
Cash, cash equivalents and restricted cash increased from $162.6 million at December 31, 2024 to $201.5 million at September 30, 2025. The increase in 2025 was primarily driven by loan repayments and sales of loan receivable, and cash proceeds from issuance of common and preferred stock shares, partially offset by a $135.7 million reduction in deposits. Following the completion of the Private Placement, the Company reduced excess cash by lowering deposits. For further details, refer to the Consolidated Statements of Cash Flows.
Previous wording
The following table is a summary of the Company’s investment securities portfolio, at fair value, at the dates shown:
Current wording
The following table is a summary of the Company’s investment securities portfolio, at fair value, as of September 30, 2025 and December 31, 2024:
Previous wording
Total investments increased by $700,000, from $84.4 million at December 31, 2024 to $85.1 million at June 30, 2025. The increase in the six months ended June 30, 2025 was primarily attributable to a $2.2 million reduction in unrealized losses on securities, partially offset by the repayment of securities totaling $1.7 million. During the six months ended June 30, 2025, the Bank did not sell any available-for-sale securities.
Current wording
Total investments increased by $21.1 million, from $84.4 million at December 31, 2024 to $105.5 million at September 30, 2025. The increase in the nine months ended September 30, 2025 was primarily attributable to a $25 million purchase, $4.5 million reduction in Other Investment, $3.8 million reduction in unrealized losses on securities, partially offset by principal paydown of $3.4 million. During the nine months ended September 30, 2025, the Bank did not sell any available-for-sale securities.
Previous wording
The Company’s loan portfolio decreased $119.9 million, from $707.5 million at December 31, 2024 to $587.5 million at June 30, 2025. The Company has continued the trend of restricting loan growth and allowing loans to pay down as the balance sheet is reduced in order to strengthen capital ratios. For the three and six months ended June 30, 2025, the Company sold $15.9 million Home Equity Line of Credit loans and $28.9 million purchased residential restate loans, resulting a recognized net loss of $995,000 on the sale. No loans were sold during the three and six months ended June 30, 2024.
Current wording
The Company’s loan portfolio decreased $118.8 million, from $707.5 million at December 31, 2024 to $588.7 million at September 30, 2025. The Company has continued the trend of restricting loan growth and allowing loans to pay down as the balance sheet is reduced in order to strengthen capital ratios. For the nine months ended September 30, 2025, the Company sold
Previous wording
SBA loans held for investment were included in the commercial real estate loans and commercial and industrial loan classifications above. As of June 30, 2025 and December 31, 2024, SBA loans included in the commercial real estate loans were $10.5 million and $18.7 million, respectively. As of June 30, 2025 and December 31, 2024, SBA loans included in the commercial and industrial loans were $10.2 million and $11.2 million, respectively.
Current wording
SBA loans held for investment were included in the commercial real estate loans and commercial and industrial loan classifications above. As of September 30, 2025 and December 31, 2024, SBA loans included in the commercial real estate loans were $9.9 million and $18.7 million, respectively. As of September 30, 2025 and December 31, 2024, SBA loans included in the commercial and industrial loans were $8.8 million and $11.2 million, respectively.
Previous wording
At June 30, 2025, the net loan to deposit ratio was 69.8% and the net loan to total assets ratio was 62.3%. At December 31, 2024, these ratios were 72.4% and 69.2%, respectively.
Current wording
At September 30, 2025, the net loan to deposit ratio was 70.0% and the net loan to total assets ratio was 61.2%. At December 31, 2024, these ratios were 72.4% and 69.2%, respectively.
Previous wording
In accordance with OCC Bulletin 2006-46, "Concentrations in Commercial Real Estate Lending, Sound Risk Management Practices: Interagency Guidance on CRE Concentration Risk Management", and the Joint Interagency Guidance (71 FR 74580), the Bank monitors its CRE lending relative to total capital. As of June 30, 2025, the Bank’s CRE concentration was 301% of total Tier 1 capital plus allowance for credit loss, below the Bank’s concentration policy limit of 350%. This concentration level is slightly above the 300% supervisory monitoring threshold outlined in the guidance. Exceeding this threshold does not, by itself, indicate unsafe or unsound banking practices; however, it subjects the Bank to heightened supervisory expectations for portfolio management, risk assessment, and capital planning. Management maintains portfolio management procedures, underwriting standards, and stress testing practices consistent with these regulatory expectations. For purposes of calculating the Bank’s CRE concentration in accordance with this regulatory guidance, owner-occupied CRE loans are excluded from the CRE total and classified as commercial and industrial (“C&I”) loans; however, the CRE portfolio tables above include owner-occupied CRE for presentation purposes.
Current wording
In accordance with OCC Bulletin 2006-46, "Concentrations in Commercial Real Estate Lending, Sound Risk Management Practices: Interagency Guidance on CRE Concentration Risk Management", and the Joint Interagency Guidance (71 FR 74580), the Bank monitors its CRE lending relative to total capital. As of September 30, 2025, the Bank’s CRE concentration was 267% of total Tier 1 capital plus allowance for credit loss, below the Bank’s concentration policy limit of 350%. This concentration level is slightly above the 300% supervisory monitoring threshold outlined in the guidance. Exceeding this threshold does not, by itself, indicate unsafe or unsound banking practices; however, it subjects the Bank to heightened supervisory expectations for portfolio management, risk assessment, and capital planning. Management maintains portfolio management procedures, underwriting standards, and stress testing practices consistent with these regulatory expectations. For purposes of calculating the Bank’s CRE concentration in accordance with this regulatory guidance, owner-occupied CRE loans are excluded from the CRE total and classified as commercial and industrial (“C&I”) loans; however, the CRE portfolio tables above include owner-occupied CRE for presentation purposes.
Previous wording
The allowance for credit losses on loans was $7.8 million as of June 30, 2025, compared to $7.3 million as of December 31, 2024, an increase of $490,000. The increase in allowance was mainly attributed to qualitative factors incorporated into the ACL calculations, even though a reduction in loan balances and the recognition of charge-offs on the unsecured consumer loan portfolio would typically suggest a decrease. Based upon the overall assessment and evaluation of the loan portfolio as of June 30, 2025, management has determined that the $7.8 million allowance for credit loss, representing 1.33% of gross loans outstanding, is adequate to cover expected credit losses under current economic conditions. This assessment follows CECL guidance, which requires estimating expected losses over the life of the loans, considering historical data, current conditions, and future forecasts.
Current wording
The allowance for credit losses on loans was $7.2 million as of September 30, 2025, compared to $7.3 million as of December 31, 2024, a reduction of $0.1 million. The reduction in allowance was mainly attributed to a decrease in reserve for loan portfolio sale. Based upon the overall assessment and evaluation of the loan portfolio as of September 30, 2025, management has determined that the $7.2 million allowance for credit loss representing 1.22% of gross loans, is adequate to cover expected credit losses under current economic conditions. This assessment follows current expected credit loss ("CECL") guidance, which requires estimating expected losses over the life of the loans, considering historical data, current conditions, and future forecasts.
Previous wording
Pursuant to guidance provided in OCC Bulletin 2020-49 and Interagency Policy Statement on Allowances for Credit Losses (May 8, 2020), the Bank refined the use of qualitative factors (“Q-Factors”) in its ACL methodology and calculations in the second quarter of 2025.
Current wording
Pursuant to guidance provided in OCC Bulletin 2020-49 and Interagency Policy Statement on Allowances for Credit Losses (May 8, 2020), the Bank refined the use of qualitative factors (“Q-Factors”) in its ACL methodology and calculations in the third quarter of 2025.
Previous wording
The application of the chosen Q-Factors added a net 12 bps to the overall reserves for Q2. The model-only ACL yielded 1.21% of total reserves – and the addition of 12 bps of Q-Factors increased the final ACL to 1.33% of total loans. The Q-Factors make up 9% of the total ACL calculation in Q2, a reasonable addition for the introduction.
Current wording
Beginning in the second quarter of 2025, the Bank implemented the use of qualitative factors (“Q Factors”) in its ACL methodology and calculations. The application of the chosen Q-Factors added a net 12 bps to the overall reserves for third quarter of 2025 – unchanged from the second quarter of 2025. The model-only ACL yielded 1.10% of total reserves – and the addition of 12 bps of Q-Factors increased the final ACL to 1.22% of total loans.
Previous wording
The following table provides detail of activity in the allowance for credit losses on loans for the three and six months ended June 30, 2025 and 2024:
Current wording
The following table provides detail of activity in the allowance for credit losses on loans for the three and nine months ended September 30, 2025 and 2024:
Previous wording
For the three months ended June 30, 2025, net charge-offs decreased $1.4 million to $536,000, with a net charge-offs to average loans ratio of 0.08%, compared to $1.9 million and 0.24% for the three months ended June 30, 2024.
Current wording
For the three months ended September 30, 2025, net charge-offs decreased $1.9 million to $205,000, with a net charge-offs to average loans ratio of 0.14%, compared to $1.1 million and 0.56% for the three months ended September 30, 2024.
Previous wording
For the six months ended June 30, 2025, net charge-offs declined $2.9 million to $1.9 million, with a net charge-offs to average loans ratio of 0.55% , down from $4.7 million and 1.15% for the six months ended June 30, 2024.
Current wording
For the nine months ended September 30, 2025, net charge-offs declined $3.7 million to $2.1 million, with a net charge-offs to average loans ratio of 0.36% , down from $5.8 million and 0.96% for the nine months ended September 30, 2024.
Previous wording
The reduction in net charge-offs for both three and six months ended June 30, 2025 was primary driven by a $2.7 million decrease in charge-offs related to purchased unsecured consumer loans as the portfolio balances have declined.
Current wording
The reduction in net charge-offs for both three and nine months ended September 30, 2025 was primary driven by a $3.7 million decrease in charge-offs related to purchased unsecured consumer loans as the portfolio balances have declined.
Previous wording
The average loan balance decreased by $148.0 million, from $805.7 million for the three months ended June 30, 2024, to $657.7 million for the three months ended June 30, 2025. For the six-month period, the average loan balance decreased $139.4 million, from $823.4 million in 2024 to $684.0 million in 2025. This decrease in average loan balance for the three and six months ended June 30, 2025, reflects the Company's continued approach of limiting loan growth and allowing loans to pay down to strengthen capital ratios as the balance sheet is reduced.
Current wording
The average loan balance decreased by $63.3 million, from $783.8 million for the three months ended September 30, 2025, to $588.4 million for the three months ended September 30, 2025. For the nine-month period, the average loan balance decreased $158.3 million, from $810.1 million in 2024 to $651.8 million in 2025. This decrease in average loan balance for the three and nine months ended September 30, 2025, reflects the Company's continued approach of limiting loan growth and allowing loans to pay down to strengthen capital ratios as the balance sheet is reduced.
Previous wording
As of June 30, 2025 and June 30, 2024, the ACL was $7.8 million and $15.0 million, respectively. The decrease was due to significant charge-offs of reserved CRE and consumer loans in 2024, which also impacted the ACL to loans ratio of 1.33% as of June 30, 2025, compared to an ACL of $15.0 million and an ACL to loans ratio of 1.93% as of June 30, 2024.
Current wording
As of September 30, 2025 and September 30, 2024, the ACL was $7.2 million and $15.0 million, respectively. The decrease was due to significant charge-offs of reserved CRE and consumer loans in 2024, which also impacted the ACL to loans ratio of 1.22% as of September 30, 2025, compared to an ACL of $15.0 million and an ACL to loans ratio of 1.98% as of September 30, 2024.
Previous wording
The nonaccrual loan balance was $24.2 million as of June 30, 2025, compared to $37.4 million as of June 30, 2024. The allowance for credit losses to nonaccrual loans ratio was 32.15% as of June 30, 2025, compared to 40.11% as of June 30, 2024. The rate at June 30, 2024 was significantly higher due to reserves on individually evaluated CRE loans that were subsequently charged-off after June 30, 2024.
Current wording
The non-accrual loan balance was $26.0 million as of September 30, 2025, compared to $36.5 million as of September 30, 2024. The allowance for credit losses to non-accrual loans ratio was 27.67% as of September 30, 2025, compared to 41.10% as of September 30, 2024. The rate at September 30, 2024 was significantly higher due to reserves on individually evaluated CRE loans that were subsequently charged-off after September 30, 2024.
Previous wording
As of June 30, 2025, non-accrual loans decreased to $24.2 million, compared to $25.9 million as of December 31, 2024. The non-accrual loans at June 30, 2025 was comprised of 166 borrowers. Of these, 14 loans were individually evaluated, and the specific reserve was zero. All individually evaluated loans were collateral dependent loans, the Bank has obtained appraisal reports from independent licensed appraisal firms and discounted those values based on the Bank’s experience selling OREO properties and for estimated selling costs to determine estimated impairment. No individually evaluated loans were cash flow dependent loans.
Current wording
As of September 30, 2025, non-accrual loans decreased to $26.0 million, compared to $28.7 million as of December 31, 2024. The non-accrual loans at September 30, 2025 was comprised of 177 borrowers. Of these, 20 loans were individually evaluated, and the specific reserve was $1.7 million. All individually evaluated loans were collateral dependent loans, the Bank has obtained appraisal reports from independent licensed appraisal firms and discounted those values based on the Bank’s experience selling Other Real Estate Owned(“OREO”) properties and for estimated selling costs to determine estimated impairment. No individually evaluated loans were cash flow dependent loans.
Previous wording
As of December 31, 2024, the $25.9 million of non-accrual loans was comprised of 335 borrowers. Of which, 14 loans were individually evaluated, and a specific reserve of $463,000 was established.
Current wording
As of December 31, 2024, the $28.7 million of non-accrual loans was comprised of 335 borrowers. Of which, 14 loans were individually evaluated, and a specific reserve of $0.5 million was established.
Previous wording
As of June 30, 2025 and December 31, 2024, the credit card loans held for sale from Digital Payments division totaled $15.0 million and $11.4 million, respectively. The credit card loans expected to be held for no longer than three days before being sold. The credit card receivable are fully cash-secured by deposits at Patriot. The credit card loans are sold to the third party as a whole loan sale transaction, priced at Par, thus there is no servicing asset or gain or loss on sale.
Current wording
As of September 30, 2025 and December 31, 2024, the credit card loans held for sale from Digital Payments division totaled $18.4 million and $11.4 million, respectively. The credit card loans are expected to be held for no longer than three days before being sold. The credit card receivable are fully cash-secured by deposits at Patriot. The credit card loans are sold to the third party as a whole loan sale transaction, priced at Par, thus there is no servicing asset or gain or loss on sale.
Previous wording
As of June 30, 2025 and December 31, 2024, the Company reported residential mortgage loans held for sale totaling $283,000 and $4.3 million, respectively. These loans are recorded at the lower of aggregate cost or market value. For the three and six months ended June 30, 2025, a total gain on sale of $43,000 was recorded. A servicing asset of $62,000 was recognized as of June 30, 2025. In April 2025, the Company decided to close the Residential Mortgage Division.
Current wording
As of September 30, 2025 and December 31, 2024, the Company reported residential mortgage loans held for sale totaling $0 and $4.3 million, respectively. These loans are recorded at the lower of aggregate cost or market value. For the three and nine months ended September 30, 2025, a total gain on sale of $0 and $79,000 was recorded, respectively. A servicing asset of $72,000 was recognized as of September 30, 2025. In April 2025, the Company decided to close the Residential Mortgage Division.
Previous wording
The effective tax benefit rate for the three months ended June 30, 2025 was (0.97)%, compared to the effective tax benefit rate for the three months ended June 30, 2024 of (23.07)%. The effective tax benefit rates for the six months ended June 30, 2025 and June 30, 2024 were (0.61)% and (20.25)%, respectively. The Company’s effective rate for the three and six months ended June 30, 2025 was affected by the change in the valuation allowance and for the three and six months ended June 30, 2024 was affected by state taxes and non-deductible expenses.
Current wording
The effective tax benefit rate for the three months ended September 30, 2025 was (0.19)%, compared to the effective tax provision rate for the three months ended September 30, 2024 of 1067.85%. The effective tax benefit and provision rates for the nine months ended September 30, 2025 and September 30, 2024 were (0.51)% and 363.40%, respectively. The Company’s effective rate for the three and nine months ended September 30, 2025 was affected by the change in the valuation allowance and for the three and nine months ended September 30, 2024 was affected by state taxes and non-deductible expenses and the full valuation allowance against all of the DTAs in the third quarter of 2024.
Previous wording
As of June 30, 2025, Patriot had available approximately $48.4 million of Federal net operating loss carryforwards (“NOL”) that are offset by $15.5 million in §382 limitations imposed by the Internal Revenue Code. After applying the limitation, Patriot has $32.9 million post-change NOL which do not expire. Patriot has not performed an analysis on the post-change NOL, but the potential impact of any additional limitation would not be material to the financial statements due to the fact that the NOL are fully offset by a valuation allowance.
Current wording
As of September 30, 2025, Patriot had available approximately $48.9 million of Federal net operating loss carryforwards (“NOL”) that are offset by $15.5 million in §382 limitations imposed by the Internal Revenue Code. After applying the limitation, Patriot has $33.4 million post-change NOL which do not expire. Patriot has not performed an analysis on the post-change NOL, but the potential impact of any additional limitation would not be material to the financial statements due to the fact that the NOL are fully offset by a valuation allowance.
Previous wording
Patriot has approximately $66.7 million of NOLs available for Connecticut tax purposes at June 30, 2025, which may be used to offset up to 50% of taxable income in any year. Approximately $63.2 million of the NOL will expire between 2030 and 2044 and approximately $3.3 million of the NOL will expire in 2055.
Current wording
Patriot has approximately $63.5 million of NOLs available for Connecticut tax purposes at September 30, 2025, which may be used to offset up to 50% of taxable income in any year. Approximately $63.2 million of the NOL will expire between 2030 and 2044 and approximately $3.3 million of the NOL will expire beginning in 2055.
Previous wording
Total deposits decreased by $135.7 million, from $966.6 million as of December 31, 2024, to $830.9 million as of June 30, 2025. The reduction was primarily driven by management focus on allowing high-cost non-relationship deposits to decrease, along with $28.7 million in deposits which were sold through the IntraFi network as of June 30, 2025. There were no such deposit sales as of December 31, 2024.
Current wording
Total deposits decreased by $135.7 million, from $966.6 million as of December 31, 2024, to $830.9 million as of September 30, 2025.
Previous wording
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 uninsured deposits to total deposits excluding Digital Payments deposits. 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 by excluding Digital Payments deposits, management can present a view of uninsured deposits that better reflects the Company's traditional deposit base, providing investors with useful information for understanding our uninsured deposits position and financial stability. Digital Payments deposits are analyzed for FDIC insurance at the Program Manager level. Certain accounts are reciprocal deposits through the IntraFi network and therefore the entire deposit balances qualify for FDIC insurance. The remaining deposit balances are aggregated at the Program Manager level, and any deposits exceeding $250,000 are considered uninsured.
Current wording
In addition to evaluating the Company's financial performance in accordance with U.S. GAAP, management may evaluate certain non-GAAP financial measures, such as uninsured deposits to total deposits excluding Digital Payments deposits. A computation and reconciliation of non-GAAP financial measures used for these purposes is contained in the accompanying Reconciliation of U.S. GAAP to Non-GAAP Measures tables. We believe that by excluding Digital Payments deposits, management can present a view of uninsured deposits that better reflects the Company's traditional deposit base, providing investors with useful information for understanding our uninsured deposits position and financial stability. Digital Payments deposits are analyzed for FDIC insurance at the Program Manager level. Certain accounts are reciprocal deposits through the IntraFi network and therefore the entire deposit balances qualify for FDIC insurance. The remaining deposit balances are aggregated at the Program Manager level, and any deposits exceeding $250,000 are considered uninsured.
Previous wording
Reconciliation of GAAP to Non-GAAP Measures (unaudited):
Current wording
Reconciliation of U.S. GAAP to Non-GAAP Measures (unaudited):
Previous wording
Total borrowings were $22.3 million and $33.1 million as of June 30, 2025 and December 31, 2024, respectively. Borrowings consist primarily of FHLB advances, senior notes, subordinated notes, junior subordinated debentures and a note payable. The senior notes, subordinated notes and junior subordinated debentures contain affirmative covenants that require the Company to maintain its and its subsidiaries’ legal entity and tax status, pay its income tax obligations on a timely basis, and comply with SEC and FDIC reporting requirements.
Current wording
Total borrowings were $16.4 million and $33.1 million as of September 30, 2025 and December 31, 2024, respectively. Borrowings consist primarily of Federal Home Loan Bank (“FHLB”) advances, senior notes, subordinated notes, junior subordinated debentures and a note payable. The senior notes, subordinated notes and junior subordinated debentures contain affirmative covenants that require the Company to maintain its and its subsidiaries’ legal entity and tax status, pay its income tax obligations on a timely basis, and comply with SEC and FDIC reporting requirements.
Showing the first 40 of 76 pairs. Open the source sections for the rest.
Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
$15.9 million Home Equity Line of Credit loans and $28.9 million purchased residential restate loans, resulting in a recognized net loss of $1.0 million on the sale. No loans were sold during the three and nine months ended September 30, 2024.
Current report — wording carried from elsewhere
On July 25, 2025, Unity Bancorp Inc. (“Unity”) notified the Company of its desire to convert the entire outstanding principal balance and accrued unpaid interest of the Senior Notes, totaling $2,005,027, into 2,673,369 shares of Common Stock at a conversion price of $0.75 per share. Similarly, on July 26, 2025, American Bank Incorporated (“AmBank”) provided notice to convert its outstanding principal balance and accrued unpaid interest of its Senior Note, amounting to $803,443, into 1,071,258 shares of Common Stock at the same conversion price of $0.75 per share.
Current report — wording carried from elsewhere
As of December 31, 2024, the Bank did not meet any of its regulatory capital requirements.