CONTACT: Mark W. Jaindl, Chairman and CEO
Allentown, PA, April 9, 2025
American Bank Incorporated (OTC Pink: AMBK), the parent company of American Bank, today announced earnings for the quarter ended March 31, 2025. Net income for the quarter was $2,369,000, or $0.36 per diluted share, an increase of $486,000 or 25.8% from $1,883,000, or $0.29 per diluted share, for the same quarter in the prior year. The increase in net income for the quarter was primarily attributable to increases in net interest income and non-interest income, offset by increases in the provision for credit losses and non-interest expense. The increased provision was primarily the result of record loan growth experienced quarter over quarter. Furthermore, the provision increased during the quarter as a result of macro-economic factors considered in the forecasting and qualitative components of the Company's determination of the allowance. The Company did not experience deterioration in asset quality during the quarter as total non-accruing loans as a percentage of total loans decreased to 0.10% at March 31, 2025, compared to 0.42% at March 31, 2024.
Total assets increased $109.4 million or 12.2% to $1.0 billion as of March 31, 2025 compared to $896.6 million as of March 31, 2024. Net loans increased $64.5 million or 8.6% from March 31, 2024 due to growth in the commercial and residential loan portfolios. Investment securities available-for-sale decreased $13.2 million or 18.2% from March 31, 2024 due to the Company’s decision to fund loan originations with proceeds from maturing investments. Total deposits increased $104.8 million or 14.8% from March 31, 2024, while total borrowings declined $875,000 or 1.1%.
Return on average assets for the quarter ended March 31, 2025 increased to 0.96% from 0.83% for the same period in 2024. Return on average equity for the quarter ended March 31, 2025 increased to 9.67% from 8.19% for the same period in 2024. The increases in the foregoing ratios were the result of increases in net income, average assets and average equity.
President and CEO Mark Jaindl stated, “We are very pleased to report a strong quarter to start 2025, as evidenced by the 26% increase in net income year over year. This growth reflects the consistency and strength of our core operations. While we saw a higher provision for credit losses due to loan growth and the broader economic inputs utilized to determine the allowance, we did not sacrifice loan quality and remain committed to steady loan growth, especially within our commercial and residential lending areas.”
Jaindl continued, “As was previously announced, we reached $1 billion in assets in mid-March. While we celebrate this milestone, we remain committed to providing a personalized, superior banking experience to our customers, the community we serve, and our shareholders, as we continue to grow thoughtfully and sustainably.”
Net interest income for the quarter ended March 31, 2025 was $6.7 million, an increase of $1.3 million or 24.4% from the quarter ended March 31, 2024. Net interest income increased primarily due to loan growth year-over-year, interest rate increases in our loan portfolio, and a decrease in interest expense paid on borrowings, offset by an increase in interest expense paid to its depositors. Net interest margin increased 28 basis points to 2.80% at March 31, 2025 from 2.52% for the quarter ended March 31, 2024.
The provision for credit losses was $622,000 for the quarter ended March 31, 2025 compared to $9,000 for the quarter ended March 31, 2024. The provision for credit losses for the quarter ended March 31, 2025 was primarily due to the growth in the loan portfolio and increases in qualitative factors in the allowance for credit losses. American Bank has an allowance for credit losses of $8.1 million or 0.99% of loans outstanding at March 31, 2025 compared to $7.5 million or 1.00% of loans outstanding at March 31, 2024. Although loan quality remained strong, there were $840,000 in non-accruing loans at March 31, 2025 compared to $3.2 million at March 31, 2024. One commercial relationship was placed on non-accrual during the third quarter of 2023, and the Bank has initiated foreclosure proceedings which will likely result in non-accruing loans falling to zero in the second quarter of 2025.
Non-interest income increased $235,000 or 47.3% to $732,000 for the quarter ended March 31, 2025 compared to the same quarter in 2024. The increase was primarily attributable to gains on other real estate owned of approximately $239,000.
Non-interest expense increased $318,000 or 9.1% to $3.8 million for the quarter ended March 31, 2025 compared to the same quarter in 2024. The increase in non-interest expense was primarily due to increases in occupancy costs, professional services, and costs associated with other real estate owned. American Bank’s operating expense to total average assets ratio increased to 1.55% for the quarter ended March 31, 2025 compared to 1.54% for the prior period. American Bank’s operating expense to average assets ratio remains one of the lowest in the country.
Income tax expense increased $124,000 or 26.6% to $591,000 for the quarter ended March 31, 2025 compared to the same quarter in 2024. The effective tax rate of 20.0% for the quarter ended March 31, 2025 was comparable to the effective tax rate of 19.9% for the quarter ended March 31, 2024.
American Bank continues to be a "well capitalized" institution as measured by all regulatory capital standards.
Selected Financial Information
About American Bank
American Bank, headquartered in Allentown, PA, is a locally owned community bank dedicated to serving customers in the Lehigh Valley for over 25 years. American Bank is an early innovator of online banking technology and continues that tradition by providing customers across the country online services that make banking easy and convenient. Their online banking service, AmericanBank Online (available at AMBK.com), allows customers to bank using a full range of real-time online banking services including online bill pay, online ACH, transfers between accounts, transaction history, check images and e-Statements. At a time when customers need the ability to bank on the go, American Bank also has mobile banking and mobile deposit for consumer and business customers. To further enhance customers’ online experience, American Bank’s Virtual Assistant, “Penny,” is conversational artificial intelligence (AI) technology available via the website or mobile app and provides convenient, 24/7 access to information and resources.
American Bank offers a complete selection of deposit and loan products and convenient services to suit the needs of consumers and businesses. Dedicated to providing customers superior, personalized customer service, American Bank offers some of the best loan and deposit rates available and as a result, has received the Bankrate.com® Top Tier award for consistently offering annual percentage yields (APYs) that were among the highest reported.
In addition, it is recognized as a 5-Star Superior rated financial institution (the highest rating possible) by Bauer Financial Inc., designating it as one of the strongest banks in the nation and was named one of the safest banks in the nation by MSN Money. American Bank was ranked #1 by the Morning Call’s Top Workplaces in the Lehigh Valley and has been named one of the Best Places to Work in Pennsylvania.
AmericanBank Online is a registered trademark for the Internet financial services provided by American Bank, a state-chartered, FDIC-insured, full-service financial institution serving customers throughout the United States. American Bank is a member of the Federal Reserve System. American Bank is FDIC insured and an Equal Housing Lender.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995
Statements in this press release regarding American Bank’s business which are not historical facts, including expectations regarding future financial results, are “forward-looking statements” that involve risks and uncertainties which could cause actual results to differ materially from such statements.