First Commerce Bancorp, Inc. Reports Second Quarter 2025 Results

LAKEWOOD, N.J., July 30, 2025 (GLOBE NEWSWIRE) -- First Commerce Bancorp, Inc. (the “Company”), (OTC: CMRB), the holding company for First Commerce Bank (the “Bank”), today reported net income of $1.3 million and $3.0 million for the three and six months ended June 30, 2025, respectively, as compared to $1.1 million and $2.2 million for the three and six months ended June 30, 2024, respectively. Basic earnings per common share for the three and six months ended June 30, 2025, were $0.07 and $0.15, respectively, compared to $0.05 and $0.10 for the three and six months ended June 30, 2024, respectively.

President & CEO Donald Mindiak commented, “We are encouraged by the balance sheet growth that we have achieved through the first six months of the year. Prudent loan underwriting, coupled with systematic investment portfolio activity has spearheaded growth in the loan portfolio of $137.1 million or 11.1% and $67.7 million or 60.4% growth in the investment portfolio during the semi-annual period ended June 30, 2025, while continuing to manage our liquidity and allowance levels at prudent levels. Funding for this growth has occurred through a combination of retail deposit growth as well as the usage of several wholesale funding sources. Since a material portion of the loan growth occurred late in the second quarter, we anticipate that the full operational effect of that growth will manifest itself in the operating statement through the balance of 2025. We are heartened by the incremental improvement of our profitability metrics and anticipate continued improvement through the end of the year. With a strong loan pipeline having solid credits at attractive spreads, we will continue to employ disciplined credit-risk management practices and conservative underwriting standards. Our goals remain steadfast in delivering exceptional customer service and growing franchise and shareholder value.”

Continuing, Mr. Mindiak remarked that, “Last quarter we reported that one large loan of $21.0 million was placed on non-accrual. We are pleased to report that this loan was successfully resolved in the second quarter, thereby improving our asset quality in the quarter. While a degree of uncertainty still exists due to the implementation of tariffs, as a community bank we have not seen any adverse effect on our credit quality.”      

Financial Highlights

Balance Sheet Review

Total assets increased by $138.5 million or 8.9% to $1.69 billion at June 30, 2025, from $1.55 billion at December 31, 2024. The increase in total assets was primarily related to increases in total investment securities and total loans receivable, partially offset by a decrease in cash and cash equivalents during the six months ended June 30, 2025.

Total cash and cash equivalents decreased by $64.9 million or 49.0% to $67.6 million at June 30, 2025, from $132.5 million at December 31, 2024. This decrease was primarily due to funding of loan closings and the purchases of investment securities during the six months ended June 30, 2025.

Total investment securities increased by $67.7 million or 60.4% to $179.9 million at June 30, 2025, from $112.2 million at December 31, 2024. The increase in investment securities resulted primarily from $77.9 million in purchases of investment securities, partially offset by $1.3 million in redemptions and $8.9 million in investment securities amortization.

Total loans receivable, net of allowance for credit losses increased by $136.6 million or 11.2% to $1.36 billion at June 30, 2025, from $1.22 billion at December 31, 2024. Commercial mortgage loans, and construction loans increased $120.1 million and $23.3 million, respectively, partially offset by decreases in commercial loans, residential loans and home equity loans of $1.0 million, $3.6 million and $2.3 million, respectively. The allowance for credit losses increased by $464,000 to $15.2 million or 1.11% of gross loans at June 30, 2025, as compared to $14.8 million or 1.19% of gross loans at December 31, 2024.

Total deposits increased $72.4 million or 6.2% to $1.25 billion at June 30, 2025, from $1.17 billion at December 31, 2024. Within the components of total deposits, time deposits increased $49.3 million, savings deposits increased $21.1 million, NOW deposits increased $6.5 million, and non-interest-bearing demand deposits increased $13.9 million, partially offset by a decrease of $18.4 million in money market account deposits. As an augmentation to deposit growth, Federal Home Loan Bank advances increased by $62.5 million or 35.7% to $237.5 million at June 30, 2025 from $175.0 million at December 31, 2024 which assisted in the facilitation of the loan growth discussed previously.

Stockholders’ equity decreased by $1.3 million or 0.7% to $171.0 million at June 30, 2025, from $172.3 million at December 31, 2024. The decrease in stockholders’ equity was primarily due to $5.7 million in repurchases of common stock, offset by increases of $3.0 million in retained earnings and $1.6 million in additional paid-in-capital. During the six months ended June 30, 2025, the Company repurchased 904,000 shares for approximately $5.6 million, or a weighted average price of approximately $6.23 per share.

Three Months of Operations

Net interest income increased by $1.3 million or 15.6% to $9.6 million for the three months ended June 30, 2025, from $8.3 million for the three months ended June 30, 2024. The increase in net interest income was primarily due to an increase in total interest income of $1.9 million as a result of an increase in average interest earning assets, partially offset by an increase in total interest expense of $648,000 as a result of an increase in average interest-bearing liabilities.

Total interest income increased by $1.9 million or 9.8% to $21.7 million for the three months ended June 30, 2025, from $19.8 million for the three months ended June 30, 2024. Interest income on loans, including fees, increased $462,000 or 2.6% to $18.4 million for the three months ended June 30, 2025, as compared to $18.0 million for the three months ended June 30, 2024. The increase in interest income on loans, including fees, resulted primarily from an increase in the average balance of loans receivable of $42.9 million or 3.4% to $1.29 billion for the three months ended June 30, 2025, as compared to $1.25 billion for the three months ended June 30, 2024. Average yield on loans receivable was 5.71% for the three months ended June 30, 2025, decreasing seven basis points year over year. Interest income on investment securities increased by $1.6 million or 224.4% to $2.3 million for the three months ended June 30, 2025, as compared to $712,000 for the same period in the prior year, as a result of purchasing and replacing paydowns of investment securities with higher yielding investment securities. The average balance of investment securities portfolio increased by $103.3 million or 134.7% to $180.0 million for the three months ended June 30, 2025, as compared to $76.7 million for the same period in the prior year. The average yield on investment securities increased by 142 basis points to 5.13% for the three months ended June 30, 2025, as compared to 3.71% for the same period in the prior year. Interest income on interest-bearing deposits with other banks decreased by $117,000 or 12.3% to $828,000 for the three months ended June 30, 2025, as compared to $945,000 for the same period in the prior year. This decrease resulted primarily from a decline in average yield of eighty-four basis points to 4.19% for the three months ended June 30, 2025, as compared to 5.03% for the same period in the prior year. The average balance of interest-bearing deposits with banks increased by $3.8 million or 5.1% to $79.3 million for the three months ended June 30, 2025, as compared to $75.5 million for the same period in the prior year.

Total interest expense increased by $648,000 or 5.7% to $12.1 million for the three months ended June 30, 2025, from $11.5 million for the three months ended June 30, 2024. The increase in interest expense occurred primarily as a result of an increase in average balance of interest-bearing liabilities of $138.1 million or 12.4%, to $1.25 billion for the three months ended June 30, 2025, from $1.12 billion for the three months ended June 30, 2024. Despite the increase in average balance of interest-bearing liabilities, the average cost of interest-bearing liabilities decreased to 3.87% for the three months ended June 30, 2025, as compared to 4.12% for the three months ended June 30, 2024. The increase in average balance of interest-bearing liabilities included a $85.5 million increase in average interest-bearing deposit liabilities and a $52.6 million increase in average wholesale borrowings for the three months ended June 30, 2025. The increase in interest-bearing liabilities was primarily used to facilitate asset growth and maintain an increased level of liquidity consistent with regulatory guidance.

During the second quarter of 2025, the Company recorded a $712,000 provision for credit losses as compared to a $300,000 provision for credit losses for the same period in the prior year. The increase in provision for credit losses for the second quarter of 2025, was primarily due to the increase in gross loans and management’s evaluation of both quantitative and qualitative factors which impact the CECL model calculations. The Company recorded a $401,000 provision for credit losses on loans, a $271,000 provision for credit losses for unfunded commitments and a $40,000 provision for credit losses on corporate securities held-to-maturity. Management believes that the allowance for credit losses on loans and investment securities at June 30, 2025, and 2024 were appropriate.

Net interest margin increased by nine basis points to 2.47% for the three months ended June 30, 2025, compared to 2.38% for the three months ended June 30, 2024. The increase in the net interest margin was primarily due to a decrease in the average cost of interest-bearing liabilities to 3.87% for the three months ended June 30, 2025 from 4.12% for the three months ended June 30, 2024, partially offset by a slight decrease in the yield on average earning assets of six basis points to 5.58% for the three months ended June 30, 2025 from 5.64% for the three months ended June 30, 2024.

Non-interest income increased by $24,000 or 4.3% to $586,000 for the three months ended June 30, 2025, from $562,000 for the three months ended June 30, 2024. The increase in total non-interest income resulted primarily from an increase in service charges and fees of $60,000, partially offset by a decrease of $44,000 in other income.

Non-interest expense increased by $576,000 or 8.0% to $7.8 million for the three months ended June 30, 2025, compared to $7.2 million for the three months ended June 30, 2024. Salaries and employee benefits increased by $194,000 or 4.3% to $4.7 million for the three months ended June 30, 2025, as compared to $4.5 million for the three months ended June 30, 2024. The increase in salaries and employee benefits resulted primarily due to a slight increase in headcount necessary to assist in the growth of the Bank and annual merit increases, partially offset by a decrease in health insurance costs year over year. Occupancy and equipment expense increased by $171,000 or 18.7% to $1.1 million for the three months ended June 30, 2025, as compared to $913,000 for the three months ended June 30, 2024, primarily due to additional lease expense related to the Company leasing additional office space to relocate its corporate offices. Advertising and marketing expense decreased by $38,000 or 34.5% to $74,000 for the three months ended June 30, 2025, as compared to $112,000 for the three months ended June 30, 2024, as a result of reduction in marketing consultant services. Professional fees decreased $47,000 or 9.7% to $427,000 for the three months ended June 30, 2025  as compared to $474,000 for the three months ended June 30, 2024 , primarily due to a reduction in audit and consulting fees. Data processing expense increased by $33,000 or 10.9% to $333,000 for the three months ended June 30, 2025, compared to $300,000 for the three months ended June 30, 2024, primarily as a result of adding new services and annual cost increases. FDIC insurance assessment increased $92,000 or 52.6% to $267,000, for the three months ended June 30, 2025, from $175,000 for the three months ended June 30, 2024, as a result of an increase in the assessment rate. Other operating expenses increased by $171,000 or 22.2% to $940,000 for the three months ended June 30, 2025, from $769,000 for the three months ended June 30, 2024, primarily due to increases in various components of other operating expenses. Other operating expenses are primarily comprised of loan related expenses, dues and subscriptions, digital banking expenses, sponsorships, training and education, postage, meals and entertainment, software maintenance and depreciation, and miscellaneous expenses. Management's focus continues to remain on prudently managing its operating expenses, while executing on our organic growth initiative.

The income tax provision increased by $98,000 or 33.9% to $385,000 for the three months ended June 30, 2025, from $287,000 for the three months ended June 30, 2024. The increase in the income tax provision resulted primarily from an increase in the pre-tax income year over year of $334,000 or 24.3% to $1.7 million for the three months ended June 30, 2025 from $1.4 million for the three months ended June 30, 2024. The effective tax rate for the quarter ended June 30, 2025, was 22.5% compared to 20.9% for the quarter ended June 30, 2024. The effective tax yield for the quarter ended June 30, 2024, was impacted by a reduction in New York state tax apportionment.

Six Months of Operations

Net interest income increased by $1.7 million or 10.1% to $18.3 million for the six months ended June 30, 2025, from $16.6 million for the six months ended June 30, 2024. The increase in net interest income was primarily due to an increase in total interest income of $3.4 million as a result of an increase in average interest earning assets, partially offset by an increase in total interest expense of $1.7 million as a result of an increase in average interest-bearing liabilities.

Total interest income increased by $3.4 million or 8.6% to $42.2 million for the six months ended June 30, 2025, from $38.8 million for the six months ended June 30, 2024. Interest income on loans, including fees, increased $172,000 or 0.5% to $35.8 million for the six months ended June 30, 2025, as compared to $35.6 million for the six months ended June 30, 2024. The increase in interest income on loans, including fees, resulted primarily from an increase in the average balance of loans receivable of $16.7 million or 1.3% to $1.27 billion for the six months ended June 30, 2025, as compared to $1.25 billion for the six months ended June 30, 2024. Average yield on loans receivable was 5.69% for the six months ended June 30, 2025, a decrease of three basis points year over year. Interest income on interest-bearing deposits with other banks increased by $222,000 or 13.9% to $1.8 million for the six months ended June 30, 2025, as compared to $1.6 million for the same period in the prior year. This increase resulted from a higher average balance of interest-bearing deposits with banks of $23.7 million or 36.6% to $88.5 million for the six months ended June 30, 2025, as compared to $64.8 million for the same period in the prior year. Interest income on investment securities increased by $2.9 million or 227.1% to $4.2 million for the six months ended June 30, 2025, as compared to $1.3 million for the same period in the prior year, as a result of purchasing and replacing paydowns of investment securities with higher yielding investment securities. The average balance of the investment securities portfolio increased by $92.7 million or 126.5% to $165.9 million for the six months ended June 30, 2025, as compared to $73.2 million for the same period in the prior year. The average yield on investment securities increased by 154 basis points to 5.02% for the six months ended June 30, 2025, as compared to 3.48% for the same period in the prior year. Dividend income on FHLB stock increased by $66,000 or 19.4% to $406,000 for the six months ended June 30, 2025, as compared to $340,000 for the same period in the prior year, primarily as a result of an increase in average balance of restricted stock of $2.0 million or 25.1% to $10.2 million for the six months ended June 30, 2025, as compared to $8.1 million for the same period in the prior year.

Total interest expense increased by $1.7 million or 7.5% to $23.9 million for the six months ended June 30, 2025, from $22.3 million for the six months ended June 30, 2024. The increase in interest expense occurred primarily as a result of an increase in average balance of interest-bearing liabilities of $128.5 million or 11.7%, to $1.23 billion for the six months ended June 30, 2025, from $1.10 billion for the six months ended June 30, 2024. Despite the increase in the average balance of interest-bearing liabilities, the average cost of interest-bearing liabilities decreased to 3.93% for the six months ended June 30, 2025, as compared to 4.07% for the six months ended June 30, 2024. The increase in average balance of interest-bearing liabilities included an $85.5 million increase in average interest-bearing deposit liabilities and a $43.0 million increase in average wholesale borrowings for the six months ended June 30, 2025. The increase in interest-bearing liabilities was primarily used to maintain an increased level of liquidity consistent with regulatory guidance and support the loan growth.

During the six months ended June 30, 2025, the Company recorded $795,000 provision for credit losses as compared to $308,000 provision for credit losses for the same period in the prior year. Based on the results of the CECL model and management’s evaluation of both quantitative and qualitative factors as well as the loan growth for the six months ended June 30, 2025, the Company recorded a provision for loan losses of $414,000 on loans, a $290,000 provision for credit losses for unfunded commitments and a $91,000 provision for credit losses on corporate securities held-to-maturity. Based upon the aforementioned analyses, management believes that the allowance for credit losses on loans and investment securities at June 30, 2025, and 2024 were appropriate.

Net interest margin for the six months ended June 30, 2025, was 2.40% compared to 2.39% for the six months ended June 30, 2024. The average yield on interest-earning assets declined 4 basis points to 5.55% for the six months ended June 30, 2025, as compared to 5.59% for the same period in the prior year. Average cost of interest-bearing liabilities declined fourteen basis points to 3.93% from 4.07% for the same period in the prior year, despite an increase in the average balance of interest-bearing liabilities of $128.5 million or 11.7% to $1.23 billion for the six months ended June 30, 2025, from $1.10 billion six months ended June 30, 2024.

Non-interest income increased by $895,000 or 82.5% to $2.0 million for the six months ended June 30, 2025, from $1.1 million for the six months ended June 30, 2024. The increase in total non-interest income resulted primarily from an increase in other income of $719,000 as a result of a non-recurring gain of $778,000 on the sale of a Company owned property recorded in the first quarter of 2025. Excluding this non-recurring gain, other income would have decreased $59,000 when compared to the same period in the prior year. Service charges and fees increased by $162,000 or 38.6% to $582,000 for the six months ended June 30, 2025, from $420,000 for the same period in the prior year, primarily due to an increase in loan fees of $56,000 and an increase in deposit accounts fees of $102,000.

Non-interest expense increased by $1.2 million or 8.4% to $15.7 million for the six months ended June 30, 2025, compared to $14.4 million for the six months ended June 30, 2024. Salaries and employee benefits increased by $432,000 or 4.8% to $9.4 million for the six months ended June 30, 2025, as compared to $9.0 million for the six months ended June 30, 2024. The increase in salaries and employee benefits resulted primarily due to a slight increase in headcount necessary to assist in the growth of the Bank and annual merit increases, partially offset by a decrease in health insurance costs year over year. Occupancy and equipment expense increased by $416,000 or 22.8% to $2.2 million for the six months ended June 30, 2025, as compared to $1.8 million for the six months ended June 30, 2024, primarily due to additional lease expense related to the Company leasing additional office space to relocate its corporate offices. Advertising and marketing expense decreased by $61,000 or 32.2% to $129,000 for the six months ended June 30, 2025, as compared to $190,000 for the six months ended June 30, 2024, as a result of reduction in marketing consultant services. Data processing expense increased by $90,000 or 15.4% to $675,000 for the six months ended June 30, 2025, compared to $585,000 for the six months ended June 30, 2024, primarily as a result of adding new services and annual cost increases. FDIC insurance assessment increased $118,000 or 31.9% to $488,000 for the six months ended June 30, 2025, from $370,000 for the six months ended June 30, 2024, as a result of an increase in the assessment rate. Other operating expenses increased by $253,000 or 16.6% to $1.8 million for the six months ended June 30, 2025, from $1.5 million for the six months ended June 30, 2024, primarily due to minor increases in various components of other operating expenses. Other operating expenses are primarily comprised of loan related expenses, communications, dues and subscriptions, digital banking expenses, sponsorships, training and education, postage, meals and entertainment, software maintenance and depreciation, and miscellaneous expenses. Management's focus continues to remain on prudently managing its operating expenses while executing on our organic growth initiative.

The income tax provision increased by $120,000 or 17.9% to $788,000 for the six months ended June 30, 2025, from $668,000 for the six months ended June 30, 2024. This increase in the income tax provision resulted primarily from an increase in the pre-tax income of $873,000 or 30.0% to $3.8 million for the six months ended June 30, 2025 from $2.9 million for the six months ended June 30, 2024 year over year. In addition, the effective tax yield declined year over year as a result of a reduction in New York state tax apportionment. The effective tax rate for the six months ended June 30, 2025, was 20.8% compared to 22.9% for the same period in the prior year.

Asset Quality

The allowance for credit losses increased by $464,000 or 3.1% to $15.2 million or 1.11% of gross loans at June 30, 2025, as compared to $14.8 million or 1.19% of gross loans at December 31, 2024, and $14.9 million or 1.18% at June 30, 2024. During the first six months of 2025, the Company added a $414,000 provision to the allowance for credit losses and had net recoveries of $50,000. Based on the results of the CECL model and management’s evaluation of both quantitative and qualitative factors during the six months ended June 30, 2025, changes in the allowance for credit losses were adjusted accordingly.

The Bank had non-accrual loans totaling $17.9 million or 1.30% of gross loans at June 30, 2025, as compared to $16.6 million or 1.34% of gross loans at December 31, 2024, and $37.9 million or 3.02% of gross loans at March 31, 2025. Non-accrual loans decreased by $20.0 million from March 31, 2025, as a result of one commercial real estate loan in the amount of approximately $21.0 million which was resolved and placed on accrual status during the second quarter of 2025. The allowance for credit losses was 85.0% of non-accrual loans at June 30, 2025, compared to 88.7%, at December 31, 2024, and 39.1% at March 31, 2025.

About First Commerce Bancorp, Inc.

First Commerce Bancorp, Inc, is a financial services organization headquartered in Lakewood, New Jersey. The Bank, the Company’s wholly owned subsidiary, provides businesses and individuals a wide range of loans, deposit products and retail and commercial banking services through its branch network located in Allentown, Bordentown, Closter, Englewood, Fairfield, Freehold, Jackson, Lakewood, Robbinsville and Teaneck, New Jersey. For more information, please go to www.firstcommercebk.com.

Forward-Looking Statements

This release, like many written and oral communications presented by First Commerce Bancorp Inc., and our authorized officers, may contain certain forward-looking statements regarding our prospective performance and strategies within the meaning of Section 27A of the Securities Act of 1933 as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and are including this statement for purposes of said safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe future plans, strategies, and expectations of the Company, are generally identified by use of the words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “plan,” “project,” “seek,” “strive,” “try,” or future or conditional verbs such as “could,” “may,” “should,” “will,” “would,” or similar expressions. Our ability to predict results or the actual effects of our plans or strategies is inherently uncertain. Accordingly, actual results may differ materially from anticipated results.

In addition to the factors previously disclosed in prior Company communications and those identified elsewhere, the following factors, among others, could cause actual results to differ materially from forward-looking statements or historical performance: the impact of changes in interest rates and in the credit quality and strength of underlying collateral and the effect of such changes on the market value of First Commerce Bank’s investment securities portfolio; changes in asset quality and credit risk; the inability to sustain revenue and earnings growth; difficult market conditions and unfavorable economic trends in the United States generally, and particularly in the market areas in which First Commerce Bank operates and in which its loans are concentrated, including the effects of declines in housing market values; inflation; customer acceptance of the Bank’s products and services; customer borrowing, repayment, investment and deposit practices; customer disintermediation; the introduction, withdrawal, success and timing of business initiatives; competitive conditions; the inability to realize cost savings or revenues or to implement integration plans and other consequences associated with certain corporate initiatives; economic conditions; and the impact, extent and timing of technological changes, capital management activities, and actions of governmental agencies and legislative and regulatory actions and reforms.