2023
Annual Report
April 4, 2024
Dear Fellow Shareholders,
We are pleased to report another successful year forff
our compam ny. We generated full year net
earnings of $7.4 million, which represents the second highest year ia n the company’nn s history.
Although we faced many challenges durd ing thet
tion, increased interest expense, and a lower loan demand due to thet
year, including higher operating costs due to
higher interest rates,
r, as well as delivering exceptional products and services to our
continued inflaff
our Team remained focused on each othet
loyal customer base.
We continuenn
relationships through the deliveryrr
continued, so we can remain competitive in delivering the most modern prr
market.
to be focused on building relationships with new clients, as well as expanding existing
in technology
of value-added produdd cts and services. Investment
ring available to the
roduct offeff
Asset growth was tempered during the year,a with loan growth of $33.4 million, or 6%, compared
to 2022 year end levels. We remained focused on profitabia lity and sharea holder returns, delivering a returnrr
on average equity of 11.94%.
on average assets of 0.95%, and returnuu
Total deposits ended the year at $687.4 million, which represents a modest level of growth for the
year. Uninsured and uncollateralized deposits remain low at $97.3 million, or 14%, of total deposits. Our
liquidity position remains strong, with ample cash and borrowing capaa
city to suppu ort our futureuu
growth.
Our capital levels remain high and aboa ve well capitalized under thet
regulatory framework.rr
Asset quality metrics continue to be stable, with no deterioration being detected. We anticipate a
modest reduction in non-performing loan levels in the first quarter of 2024, based on already defined and
implemented solutions associated with two legacy credits. We expect that the higher debt and living
expenses may have an impact on consumers in the future, but we do not see any signs of deterioration or
stress in the portfolff
prepared to assist our clients with defined
mitigation strat
tegies, should they experience stret ss or financa
io. We closely monitor the portfolio and area
ial hardship.
Our investment in our Team through continued education and training will continue in 2024 so that
we can exceed our clients’ expectations and continuenn
to differff entiate ourselves from the competition.
We are thankful forff
your continuenn d support and look forff ward to a promising and profitable 2024!
Sincerely,
Linda M. Rohrer
Chairman of the Board
Robert B. White
President & Chief Executive Officff er
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Consolidated Financial Statements
December 31, 2023 and 2022
(With Independent Auditors’ Report Thereon)
Crowe LLP
Independent Member Crowe Global
INDEPENDENT AUDITOR'S REPORT
Shareholders and the Board of Directors
1st Colonial Bancorp, Inc. and Subsidiary
Mount Laurel, New Jersey
Opinion
We have audited the consolidated financial statements of 1st Colonial Bancorp, Inc. and Subsidiary, which
comprise the consolidated statements of financial condition as of December 31, 2023 and 2022, and the
related consolidated statements of operations, comprehensive income, changes in shareholders’ equity,
and cash flows for the years then ended, and the related notes to the financial statements.
In our opinion, the accompanying consolidated financial statements present fairly, in all material respects,
the financial position of 1st Colonial Bancorp, Inc. and Subsidiary as of December 31, 2023 and 2022, and
the results of their operations and their cash flows for the years then ended in accordance with accounting
principles generally accepted in the United States of America.
Basis for Opinion
We conducted our audits in accordance with auditing standards generally accepted in the United States of
America (GAAS). Our responsibilities under those standards are further described in the Auditor’s
Responsibilities for the Audit of the Financial Statements section of our report. We are required to be
independent of 1st Colonial Bancorp, Inc. and to meet our other ethical responsibilities, in accordance with
the relevant ethical requirements relating to our audits. We believe that the audit evidence we have obtained
is sufficient and appropriate to provide a basis for our audit opinion.
Emphasis of Matter
As discussed in Note 2 to the consolidated financial statements, in 2023, the entity adopted new
accounting guidance of Financial Accounting Standards Board (FASB) Accounting Standards Codification
No. 326, Financial Instruments – Credit Losses (ASC 326) using the modified retrospective method such
that prior period amounts are not adjusted and continue to be reported in accordance with previously
applicable generally accepted accounting principles. Our opinion is not modified with respect to this
matter.
Responsibilities of Management for the Financial Statements
is responsible for the preparation and fair presentation of
Management
the consolidated financial
statements in accordance with accounting principles generally accepted in the United States of America,
and for the design, implementation, and maintenance of internal control relevant to the preparation and fair
presentation of consolidated financial statements that are free from material misstatement, whether due to
fraud or error.
(Continued)
1.
In preparing the consolidated financial statements, management is required to evaluate whether there are
conditions or events, considered in theag gregate, that raise substantial doubt about 1st Colonial Bancorp,
Inc.’s ability to continue as a going concern for one year from the date the consolidated financial statements
are available to be issued.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as
a whole arefr ee from material misstatement, whether due to fraud or error, and to issue an auditor’s report
that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance
and therefore is not a guarantee that an audit conducted in accordance with GAAS will always detect a
material misstatement when it exists. The risk of not detecting amate rial misstatement resulting from fraud
is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control. Misstatements are considered material if there is a
substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a
reasonable user based on the consolidated financial statements.
In performing an audit in accordance with GAAS, we:
•
•
Exercise professional judgment and maintain professional skepticism throughout the audit.
Identify and assess the risks of material misstatement of the consolidated financial statements, whether
due to fraud or error, and design and perform audit procedures responsive to those risks. Such
procedures include examining, on ate st basis, evidence regarding the amounts and disclosures in the
consolidated financial statements.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of 1st Colonial Bancorp, Inc.’s internal control. Accordingly, no such opinion is expressed.
•
Evaluate the appropriateness of accounting policies used and the reasonableness of significant
accounting estimates made by management, as well as evaluate the overall presentation of the
consolidated financial statements.
• Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that
raise substantial doubt about 1st Colonial Bancorp, Inc.’s ability to continue as a going concern for a
reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters, the
planned scope and timing of the audit, significant audit findings, and certain internal control–related matters
that we identified during the audit.
Washington, D.C.
March 27, 2024
Crowe LLP
2.
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Consolidated Statements of Financial Condition
(Dollars in thousands, except share data)
Assets
Cash and due from banks
Federal funds sold
Total cash and cash equivalents
As of December 31,
2022
2023
$
52,707
21
52,728
$
20,377
22
20,399
Investments held to maturity (fair value of $37,045 as of December 31, 2023
and $38,114 as of December 31, 2022)
37,045
38,114
Investments available for sale ("AFS") (amortized cost of $76,746 as of
December 31, 2023 and $99,160 as of December 31, 2022)
Investment in restricted bank stock, at cost
Loans held for sale
Loans
Less allowance for credit losses
Net loans
Premises and equipment, net
Accrued interest receivable
Deferred tax assets
Bank-owned life insurance
Other assets
Total assets
Liabilities and S hareholders’ Equity
Liabilities:
Deposits
Subordinated debt, net of issuance costs
Other borrowings
Accrued interest payable
Other liabilities
Total liabilities
Shareholders’ equity:
Preferred stock. Authorized 1,000,000 shares, no shares issued
Common stock, $0 par value. Authorized 10,000,000 shares; issued
5,221,096 and 5,148,221 shares as of December 31, 2023 and
December 31, 2022, respectively, and outstanding of 4,747,479 and
4,675,244 shares as of December 31, 2023 and December 31, 2022, respectively
Additional paid-in capital
Retained earnings
Accumulated other comprehensive loss
Treasury stock at cost, 473,617 and 472,977 shares as of December 31, 2023
and December 31, 2022, respectively
Total shareholders’ equity
Total liabilities and shareholders’ equity
See accompanying notes to consolidated financial statements.
70,532
1,457
3,619
637,037
(9,690)
627,347
1,770
3,431
3,714
17,894
6,107
825,644
687,444
10,631
53,600
668
5,378
757,721
$
$
91,017
2,894
6,710
603,609
(8,331)
595,278
1,845
2,779
3,825
14,548
4,554
781,963
671,052
10,559
34,788
405
5,521
722,325
$
$
-
-
-
39,294
37,426
(4,549)
-
38,619
31,149
(5,890)
(4,248)
67,923
825,644
$
(4,240)
59,638
781,963
$
3
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Consolidated Statements of Operations
For the years ended December 31,
(Dollars in thousands, except share data)
2023
2022
Interest income:
Loans
Federal funds sold and interest-bearing deposits
Investments:
Taxable
Nontaxable
Total interest income
Interest expense:
Deposits
Subordinated debt
Other borrowings
Total interest expense
Net interest income
Provision for credit losses
Net interest income after provision for credit losses
Other income:
Gain on sales of mortgage loans held for sale
Gain on sale of guaranteed portion of SBA loans
M ortgage fee income
Bank-owned life insurance income
Service charges on deposit accounts
Gain on sales of portfolio loans
Gain (loss) on real estate owned
Other income and fees
Total other income
Other expenses:
Compensation and employee benefits
Data processing expense
Occupancy and equipment expenses
Professional services
Loan expenses
FDIC and state assessments
Advertising expense
Other operating expenses
Tot al other expenses
Income before income tax expense
Income tax expense
Net income
Earnings per share:
Basic earnings per share
Diluted earnings per share
$
36,010
702
$
27,674
142
1,623
986
39,321
11,025
824
1,122
12,971
26,350
270
26,080
667
479
510
527
103
72
-
431
2,789
11,314
2,024
1,342
894
701
511
388
1,781
18,955
9,914
2,483
7,431
1.58
1.54
$
$
$
1,679
378
29,873
2,692
872
300
3,864
26,009
1,150
24,859
909
852
595
1,440
99
-
37
419
4,351
11,220
1,731
1,231
602
596
369
206
1,862
17,817
11,393
2,895
8,498
1.82
1.76
$
$
$
Weighted average number of shares outstanding:
Basic earnings per share
Diluted earnings per share
4,705,189
4,827,793
4,681,122
4,826,184
See accompanying notes to consolidated financial statements.
4
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Consolidated Statements of Comprehensive Income
(In thousands)
Net income
Other comprehensive income (loss):
Net unrealized gain (loss) on AFS investment securities:
Net unrealized holding gain (loss) arising during the period
For the years ended December 31,
Before
tax
amount
9,914
$
2023
Tax
expense
(benefit)
$
2,483
Net of
tax
amount
7,431
$
Before
tax
amount
11,393
$
2022
Tax
expense
(benefit)
$
2,895
Net of
tax
amount
8,498
$
1,929
588
1,341
(8,517)
(2,355)
(6,162)
Total net unrealized gain (loss) on AFS investment securities
Other comprehensive income (loss)
Total comprehensive income
1,929
1,929
11,843
$
588
588
3,071
$
1,341
1,341
8,772
(8,517)
(8,517)
2,876
(2,355)
(2,355)
540
(6,162)
(6,162)
2,336
$
$
$
$
See accompanying notes to consolidated financial statements.
5
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Consolidated Statements of Changes in Shareholders’ Equity
For the years ended December 31, 2023 and 2022
(In thousands)
Additional
paid-in
capital
Retained
earnings
Accumulated
other
comprehensive
income (loss)
Treasury
stock
Total
shareholders’
equity
Balance as of Janaury 1, 2022
Stock issued
Purchase of treasury stock (78,881 shares)
Net unrealized loss on securities
available for sale, net of tax
$
Stock-based compensation
Net income
38,250
104
265
Balance as of December 31, 2022
38,619
Cumulative change in accounting principle
for the adoption of ASC 326*
Balance as of January 1, 2023
Stock issued
Purchase of treasury stock (640 shares)
Net unrealized gain on securities
available for sale, net of tax
Stock-based compensation
Net income
Balance as of December 31, 2023
38,619
306
369
$
22,651
$
272
$
(3,356)
$
8,498
31,149
(1,154)
29,995
(884)
(6,162)
(5,890)
(4,240)
(5,890)
(4,240)
(8)
1,341
$
39,294
$
7,431
37,426
$
(4,549)
$
(4,248)
$
57,817
104
(884)
(6,162)
265
8,498
59,638
(1,154)
58,484
306
(8)
1,341
369
7,431
67,923
*See Note 2 Summary of Significant Accounting Policies
See accompanying notes to consolidated financial statements.
6
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Consolidated Statements of Cash Flows
For the years ended December 31, 2023 and 2022
(In thousands)
Cash flows from operating activities:
Net income
Adjustments to reconcile net income to net cash provided by (used in)
operating activities:
2023
2022
$
7,431
$
8,498
Depreciation and amortization
Net amortization of premium on investment securities
Net accretion of deferred fees and costs on loans
Amortization of issuance costs on long-term debt
Stock-based compensation expense
Gain on sale of investment securities
Gain on sales of mortgage loans held for sale
Gain on sales of guaranteed portion of SBA loans
Provision for credit losses
Cash disbursed for mortgage banking activities
Cash received for mortgage banking activities
Proceeds from sales of portfolio loans
(Gains) losses on sales of portfolio loans
Net (gain) loss on sales of OREO
Net (gain) loss on disposals of premises and equipment
Increase in cash value of bank-owned life insurance, net
Decrease in deferred income tax benefit
Changes in assets and liabilities:
Increase in accrued interest receivable
Increase in other assets
Increase in accrued interest payable
(Decrease) increase in other liabilities
Total adjustments
Net cash provided by operating activities
Cash flows from investing activities:
Proceeds from maturities and calls of AFS investment securities
Proceeds from sales of AFS investment securities
Proceeds from principal repayment of AFS investment securities
Proceeds from maturities of securities held to maturity
Proceeds from sales of short-term investments
Purchases of securities available for sale
Purchases of securities held to maturity
Redemption (purchase) of restricted bank stock
Proceeds from sale of real estate owned-
Increase in loans receivable, net(39,
Proceeds from the sale of premises and equipment
Capital expenditures
Proceeds from bank owned life insurance policies
Purchase of life insurance policies
Net cash used in investing activities
7
487
114
(656)
72
369
-
(667)
(479)
270
(58,329)
62,087
7,287
(72)
-
(6)
(527)
41
(652)
(2,073)
263
(142)
7,387
14,818
15,000
-
7,300
36,602
-
-
(35,533)
1,437
571)
11
(417)
1,181
(4,000)
(17,990)
323
184
(1,278)
119
265
-
(909)
(852)
1,150
(89,549)
93,723
-
-
(37)
68
(1,440)
66
(1,115)
(1,262)
102
1,723
1,281
9,779
-
-
10,469
16,498
-
(16,856)
(36,136)
(1,420)
76
(99,360)
-
(1,164)
3,052
-
(124,841)
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Consolidated Statements of Cash Flows - Continued
For the years ended December 31, 2023 and 2022
Cash flows from financing activities:
Net increase in deposits
Net increase (decrease) in short-term borrowings
Proceeds from long-term borrowings, net of issuance costs
Acquisition of treasury stock(8)
Proceeds from exercise of stock options
Stock issuance costs-
Net cash provided by financing activities
Net (decrease) increase in cash and cash equivalents
Cash and cash equivalents at beginning of year
2023
2022
16,391
18,812
-
306
35,501
32,329
20,399
60,576
34,788
-
(884)
104
-
94,584
(20,478)
40,877
Cash and cash equivalents at end of year
$
52,728
$
20,399
Supplemental disclosures:
Cash paid during the year for:
Interest
Income taxes paid
Noncash items:
Net change in unrealized loss (gain) on securities available for sale, net of
tax benefit of $588 for 2023 and $2,355 for 2022
Transfer to real estate owned
Lease liabilities for obtaining right of use assets
See accompanying notes to the consolidated financial statements.
$
$
12,708
3,025
1,341
-
-
$
$
3,063
3,957
(6,162)
39
1,745
8
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
Note 1. Nature of Operations
1st Colonial Bancorp, Inc. (the “Company”, “We” or “Our”) is a Pennsylvania corporation headquartered in Mount
Laurel, New Jersey, and the parent company of 1st Colonial Community Bank (the “Bank”). The Bank opened for
business on June 30, 2000 and provides a wide range of business and consumer financial services through its two New
Jersey branch offices located in Collingswood and Westville and its location in Limerick, Pennsylvania.
The Company was organized as the holding company for the Bank, in connection with the reorganization approved
by the Bank’s shareholders at the annual meeting on June 12, 2002. As a bank holding company registered under the
Bank Holding Company Act of 1956, the Company is subject to the supervision and regulation of the Board of
Governors of the Federal Reserve System (the “FRB”). The Bank was a national bank until November 1, 2012 when
it was granted a state charter by the New Jersey Department of Banking and Insurance. The Bank’s deposits are insured
by the Federal Deposit Insurance Corporation (“FDIC”). The Company’s operations and those of the Bank are subject
to supervision and regulation by FRB, the FDIC, and the New Jersey Department of Banking and Insurance. The
principal activity of the Bank is to provide its local communities with general commercial and retail banking services.
The Bank is managed as one business segment.
Subsequent Events
The Company has evaluated subsequent events for recognition and disclosure through March 27, 2024, which is the
date the financial statements were available to be issued. No subsequent events occurred requiring accrual or
disclosure.
Note 2. Summary of Significant Accounting Policies
Basis of Presentation
The accompanying consolidated financial statements include the accounts of the parent company, 1st Colonial
Bancorp, Inc. and its wholly owned subsidiary, 1st Colonial Community Bank. The accounting and reporting policies
of the Company conform to U.S. generally accepted accounting principles (“GAAP”) and, where applicable, to
accounting and reporting guidelines prescribed by bank regulatory authorities. Prior period amounts have been
reclassified, where necessary, to conform to current year classification.
Use of Estimates
The preparation of consolidated financial statements in conformity with GAAP requires management to make
estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the consolidated financial statements and the reported amounts of income and expenses
during the reporting period. Actual results could differ from those estimates.
Significant Concentration of Credit Risk
Credit risk is one of our most significant risks. It is critical for consistent profitability that we effectively manage credit
risk. Most of the Company’s activities are with customers located within the Mid-Atlantic region of the country. “Note
4 – Investment Securities” to the Consolidated Financial Statements discusses the types of securities in which the
Company invests. “Note 5 – Loans Receivable” to the Consolidated Financial Statements discusses the types of
lending in which we engage. We do not have any portion of our business dependent on a single or limited number of
customers, the loss of which would have a material adverse effect on our business. We have 90% of our investment
portfolio in securities issued by government sponsored entities.
No substantial portion of loans is concentrated within a single industry or group of related industries, except a
significant majority of loans are secured by real estate. There are numerous risks associated with commercial and
consumer lending that could impact the borrower’s ability to repay on a timely basis. They include but are not limited
to: the owner’s business expertise, changes in local, national, and in some cases international economies, competition,
government regulation, and the general financial stability of the borrowing entity. Our commercial real estate,
9
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
construction and land development, and commercial and industrial loans comprised 28%, 6% and 5%, respectively,
of the loan portfolio.
We attempt to mitigate these risks through conservative underwriting policies and procedures which include an
analysis of the borrower’s business and industry history, its financial position, as well as that of the business owner.
We will also require the borrower to provide current financial information on the operation of the business periodically
over the life of the loan. In addition, most commercial loans are secured by assets of the business or those of the
business owner, which can be liquidated if the borrower defaults, along with the personal surety of the business owner.
Cash and Cash Equivalents
For purposes of reporting cash flows, cash and cash equivalents include cash, deposits with other financial institutions
with maturities fewer than 90 days, and federal funds sold. Net cash flows are reported for customer loan and deposit
transactions, interest bearing deposits in other financial institutions, and federal funds purchased and repurchase
agreements.
Investments
Debt securities that management has the positive intent and ability to hold until maturity are classified as held to
maturity (“HTM”) and are carried at their remaining unpaid principal balance, net of unamortized premiums or
unaccreted discounts. Securities not classified as held to maturity are classified as available-for-sale (“AFS”) and are
stated at fair value, with unrealized gains and losses reported in accumulated other comprehensive income (loss), net
of tax.
Premiums are amortized and discounts are accreted to interest income using a level yield method over the estimated
remaining term of the underlying security. Gains and losses are determined using the specific identification method
and are accounted for on a trade date basis.
On January 1, 2023, we adopted Accounting Standards Update No. 2016-13, “Financial Instruments-Credit Losses
(Topic 326) Measurement of Credit Losses on Financial Instruments” (“CECL”) issued by the Financial Accounting
Standards Board (“FASB”). Under CECL expected credit losses on both HTM and AFS securities are to be recognized
through a valuation allowance to the Allowance for Credit Losses (“ACL), instead of a direct write-down to the
amortized cost basis of the security.
HTM securities: Approximately 99% of our HTM securities portfolio is comprised of municipal bond anticipation
notes (“BANs”) that are payable ultimately from ad valorem taxes to be levied upon all the taxable real property within
the municipality issuing the BAN and have a maturity date of one year or less. As of December 31, 2023 no HTM
debt securities required an ACL.
AFS securities: For AFS debt securities in an unrealized loss position we first assess whether we intend to sell, or it is
more likely than not that we will be required to sell the security before recovery of its amortized cost basis. If either
of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is written down to fair
value through income. For AFS debt securities that do not meet the aforementioned criteria, we evaluate whether the
decline in fair value has resulted form credit losses or other factors. We will record the portion of the impairment
related to credit losses (if any) in the ACL with an offsetting entry to the Provision for credit losses of our Consolidated
Income Statement. Any portion of the impairment not related to credit losses is recorded through other comprehensive
income (“OCI”).
We evaluate declines in the fair value of securities at least on a quarterly basis. The evaluation is a quantitative and
subjective process. Management considers numerous factors, including but not limited to: (1) the extent to which the
fair value is less than the amortized cost, (2) our intent to hold or sell the security, (3) the financial condition and
results of the issuer including changes in capital, (4) the credit rating of the issuer, (5) industry trends specific to the
security, and (6) timing of debt maturity and status of debt payments.
10
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
In determining our intent not to sell and whether it is more likely than not that we will be required to sell the
investments before recovery of their amortized cost basis, we consider the following factors: current liquidity and
availability of other non-pledged assets that permits the investment to be held for an extended period of time but not
necessarily until maturity, capital planning, and any specific asset liability committee goals or guidelines related to
the disposition of specific investments.
Restricted Bank Stock
The Bank is a member of the Federal Home Loan Bank (“FHLB”) system. The Bank is required to acquire and hold
shares of capital stock in the FHLB based upon a percentage of the Bank’s FHLB borrowings, unused borrowing
capacity, and the amount of residential first mortgage loans sold to the FHLB. The FHLB stock is carried at cost and
is included in bank stock in the consolidated statements of financial condition. The Bank evaluates FHLB stock for
impairment based on the ultimate recoverability of par value rather than by recognizing temporary declines in value.
The Bank is required to maintain an investment in Atlantic Community Bankers Bank (“ACBB”) stock. The ACBB
stock is carried at cost because it does not have a readily determinable fair value. The Bank had $40 thousand in ACBB
stock as of December 31, 2023 and 2022, respectively.
Mortgage Loans Held for Sale
We originate and sell residential mortgage loans with servicing released to the secondary market. This activity enables
us to fulfill the credit needs of the community while reducing its overall exposure to interest rate and credit risk. These
loans are reported at fair market value.
Loans Receivable
Loans receivable are classified as loans held for investment (“LHFI”) when management has the intent and ability to
hold the loan or lease for the foreseeable future or until maturity or payoff. LHFI are stated at their outstanding unpaid
principal balances, net of an allowance for credit losses and any deferred fees or costs. Interest income is accrued on
the principal amount outstanding. Loan origination fees and related direct costs are deferred and amortized to interest
income over the term of the respective loan as a yield adjustment.
LHFI are segmented into commercial real estate loans, construction and development loans, commercial loans,
residential loans, and consumer loans. The commercial real estate loan segment consists of owner-occupied and non-
owner occupied commercial real estate loans and multi-family real estate loans. The construction and development
loan segment consists of residential and commercial acquisition and development loans. Commercial loans, which are
also generally known as commercial and industrial loans, include permanent and short-term working capital and
machinery or equipment financing. The residential loan segment consists of primary or secondary home mortgage
loans, home equity lines of credit, and home equity loans.
Commercial Real Estate Loans: The commercial real estate loan portfolio consists primarily of loans secured by office
buildings, retail and industrial use buildings, strip shopping centers, mixed-use and other properties used for
commercial purposes primarily located in our market area. Although terms for commercial real estate and multi-family
loans vary, the underwriting standards generally allow for terms up to 10 years with the interest rate being reset in the
sixth year and with monthly amortization not greater than 25 years and loan-to-value ratios of not more than 80%.
Interest rates are either fixed or adjustable and are predominantly based upon the prime rate or the five-year U.S.
Treasury rate plus a margin. Prepayment fees are charged on most loans in the event of early repayment. Generally,
the personal guarantees of the principals are obtained as additional collateral for commercial real estate and multi-
family real estate loans.
Construction and Development Loans: We originate construction loans to builders and developers predominantly in
our market area. Construction and development loans are riskier than other loan types because they are more
speculative in nature. Deteriorating economic or environmental conditions can negatively affect a project.
Construction loans are also more difficult to evaluate and monitor. In order to mitigate some of the risks inherent in
construction lending, limits are placed on the number of units that can be built on a speculative basis based upon the
11
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
reputation and financial position of the builder, his/her present obligations, the location of the property and prior sales
in the development and the surrounding area. Additionally, the construction budget is reviewed prior to loan
origination and the properties under construction are inspected. During the construction phase of a real estate project,
the loan requires interest payments only.
Commercial: Our commercial business loans generally have been made to small
to mid-sized businesses
predominantly located in our market area. The commercial business loans are either a revolving line of credit or for a
fixed term. Interest rates are adjustable, indexed to a published prime rate of interest, or fixed. Generally, equipment,
machinery, real property or other corporate assets secure such loans. Personal guarantees from the business principals
are generally obtained as additional collateral.
Residential Loans: We originate residential mortgage loans that we retain in our loan portfolio to diversify credit risk.
We have also acquired residential mortgages through pool purchases. The mortgages we originate or acquire are
secured primarily by properties located in our primary market and surrounding areas. We originate home equity loans
and home equity lines of credit in our market area. The collateral must be the borrower’s primary or secondary
residence. Home equity lines of credit are variable rate and are indexed to the prime rate. Our home equity loans are
either first or second liens and have a fixed rate. We have originated some home equity lines of credit or home equity
loans for investment homes. Residential loans also include business loans secured by primary liens on one-to four
family real estate collateral.
Consumer Loans: We originate cash-secured and unsecured loans and lines of credit to individuals. Unsecured
consumer loans generally have a higher interest rate than residential loans because they have additional credit risk
associated with them.
Loans are reported as non-accrual if they are past due as to principal or interest payments for a period of 90 days or
more. Exceptions may be made if a loan is deemed by management to be well collateralized and in the process of
collection. Loans that are on a current payment status may also be classified as non-accrual if there is serious doubt
as to the borrower’s ability to continue interest or principal payments. When a loan is placed on non-accrual all unpaid
interest is reversed from interest income. Interest payments received on nonaccrual loans are normally applied against
principal. Excess proceeds received over the principal amounts due on non-accrual loans are recognized as income on
a cash basis. We recognize income under the accrual basis when the principal payments on the loans become current
and the collateral on the loan is sufficient to cover the outstanding obligation to the Company. If these factors do not
exist, we do not recognize income. Generally, loans are restored to accrual status when the loan is brought current,
has performed in accordance with the contractual terms for a reasonable period of time (generally six months) and the
ultimate collectability of the total contractual principal and interest is no longer in doubt. The past due status of all
classes of loans receivable is determined based on contractual due dates for loan payments.
Allowance for Credit Losses
CECL Adoption
On January 1, 2023, we adopted ASU 2016-13, Financial Instruments - Credit Losses (“ASC Topic 326”):
Measurement of Credit Losses on Financial Instruments, as amended, which replaces the incurred loss methodology
with an expected loss methodology that is referred to as the current expected credit loss (“CECL”) methodology. The
measurement of expected credit losses under CECL is applicable to financial assets measured at amortized cost,
including loan receivables and HTM debt securities. It also applies to off-balance sheet (“OBS”) credit exposures,
such as loan commitments, standby letters of credit, financial guarantees, and other similar instruments.
The Company adopted ASC 326 using the modified retrospective method for all financial assets measured at amortized
cost basis and OBS credit exposures. Results for the 2023 reporting period are presented under ASC 326 while prior
reporting periods continue to be reported in accordance with previously applicable GAAP. We recorded a net increase
of $1.6 million to the ACL on January 1, 2023 as result of the adoption of CECL. Retained earnings decreased $1.2
and deferred tax assets increased by $434 thousand. Included in the $1.6 million increase to the ACL was $436
thousand for certain OBS credit exposures.
12
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
The following table illustrates the impact of ASC 326.
(In thousands)
Assets
Loans:
January 1, 2023
As reported
Impact of
Under
Pre-ASC 326
ASC 326
ASC 326
Adoption
Adoption
Commercial real estate
$
(1,961)
$
(3,403)
$
1,442
Construction and land development
Commercial
Residential real estate
Consumer
Allowance for credit losses on loans
Deferred tax assets, net
Liabilities
(1,011)
(1,824)
(4,657)
(30)
(9,483)
4,259
(54)
(455)
(2,063)
(22)
(1,152)
434
(957)
(1,369)
(2,594)
(8)
(8,331)
3,825
-
Allowance for credit losses on OBS commitments
$
993
$
557
$
436
Shareholders' Equity
Retained Earnings
29,995
31,149
(1,154)
Management estimates the ACL using relevant available information from internal and external sources, relating to
past events, current conditions, and reasonable and supportable forecasts. Historical credit loss experience provides
the basis for the estimation of credit losses. We have incorporated the use of peer institution data to inform regression
analysis designed to quantify the impact of reasonable and supportable forecasts in our models.
Adjustments to historical loss information are made to address various risk characteristics of our loan portfolio such
as changes in lending policies and procedures, trends in delinquencies and other non-performing loans, changes in
economic conditions and collateral values, changes in growth trends or concentrations of loan segments, and other
external factors such as regulatory environment.
Loans are either evaluated on a collective (pool) basis or on an individual basis for expected credit losses.
The ACL is measured on a collective pool basis when similar characteristics exist. The Company has identified five
portfolio segments based on the Federal Call Code segmentation and measures the allowance for ACL using
discounted cash flow. All periods during the reasonable and supportable forecast period utilize a forecasted loss rate.
We have elected to forecast the first four quarters of the credit loss estimate and revert to a long-run average of each
considered economic factor as permitted under CECL. The reversion period is four quarters.
We will evaluate loans individually when they do not share similar risk characteristics with loans evaluated on a pool
basis. Loans can be identified for individual evaluation based on nonaccrual status, delinquency, risk rating or
modification. Loans individually evaluated are excluded from the pool evaluation. We have elected to exclude accrued
interest receivable from the measurement of its ACL. When a loan is placed on non-accrual status, any outstanding
accrued interest is reversed against interest income.
The estimated fair values of substantially all of our individually evaluated loans are measured based on the estimated
fair value of the loan’s collateral. We obtain third-party appraisals or valuations to establish the fair value of real estate
13
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
collateral. Appraised values are discounted to arrive at the estimated selling price of the collateral, which is considered
to be the estimated fair value less estimated costs to sell the property. For commercial and industrial loans secured by
non-real estate collateral, such as accounts receivable, inventory and equipment, estimated fair values are determined
based on the borrower’s financial statements, inventory reports, accounts receivable aging or equipment appraisals or
invoices. Indications of value from these sources are generally discounted based on the age of the financial information
or the quality of the assets. When the fair value of the loan is less than the carrying value, a specific reserve is
established in the ACL for the difference.
OBS Commitments: The ACL on OBS commitments is a liability for credit losses on commitments to originate or
fund loans. It is included in “Other liabilities” on the consolidated balance sheets. Expected credit losses are estimated
over the contractual period in which the Company is exposed to credit risk via a commitment that cannot be
unconditionally canceled. In addition, the estimate of the liability considers the likelihood that funding will occur. The
ACL on unfunded commitments is adjusted through provision for credit losses on consolidated statements of
operations. Because the business processes and risks associated with unfunded commitments are essentially the same
as loans, the Company uses the same process to estimate the liability.
Premises and Equipment
Premises and equipment are recorded at cost less accumulated depreciation and amortization. Depreciation is
computed using the straight-line method over the expected useful lives of the assets. Amortization of leasehold
improvements is computed using the straight-line method over the shorter of the useful lives or the remaining lease
term. Software costs, furniture, and equipment have depreciable lives of 3 to 10 years. Building and improvements
have estimated useful lives of 5 to 35 years. The costs of maintenance and repairs are expensed as they are incurred,
and renewals and betterments are capitalized.
Leases
Our leases are operating leases and are predominantly related to real estate. As a lessee we record, for all leases with
a lease term of more than 12 months, an asset representing our right to use the underlying asset and a liability to make
lease payments. The right-of-use (“ROU”) asset is included in other assets and the lease liability is included in other
liabilities on the balance sheet. The amortization of operating lease ROU assets and the accretion of operating lease
liabilities are reported together as fixed lease expense and are included in occupancy and equipment expense within
other expense. The fixed lease expense is recognized on a straight-line basis over the life of the lease. The Company
has elected to exclude leases with original terms of less than one year from the operating lease ROU assets and lease
liabilities.
Other Real Estate Owned
Other real estate owned (“OREO”) is comprised of properties acquired through foreclosure proceedings or acceptance
of a deed in lieu of foreclosure. Real estate owned is recorded at the lower of the carrying value of the loan or the fair
value of the property, net of estimated selling costs. Costs relating to the development or improvement of properties
are capitalized, while expenses related to the operation and maintenance of properties are expensed as incurred. Gains
or losses upon dispositions are reflected in earnings as realized. The Bank had no OREO as of December 31, 2023
and 2022.
Bank-Owned Life Insurance
We have bank-owned life insurance (“BOLI”) policies on certain officers and key employees. These policies are
reflected on the consolidated statements of financial condition at their cash surrender value, or the amount that can be
realized. Income from these policies and changes in the cash surrender value are recorded in non-interest income.
During 2023, we surrendered a $1.0 million policy due to a significantly below market yield. We paid a $28 thousand
tax penalty upon the redemption and reinvested the proceeds in a new BOLI policy. During 2022, we received $3.1
million in insurance proceeds related to three former employees covered by BOLI policies and recorded $1.0 million
in income from these proceeds. Income from the insurance proceeds is included in BOLI income on our Consolidated
Statements of Operations.
14
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
Earnings Per Share
Basic earnings per share is calculated as net income divided by the weighted average number of shares outstanding,
net of treasury stock, during the period. Dilutive earnings per share include dilutive common stock equivalents as
computed under the treasury stock method using average common stock prices.
Mortgage Banking Derivatives
Commitments to fund mortgage loans (interest rate lock commitments) to be sold in the secondary market and forward
commitments for the future delivery of these mortgage loans are accounted for as freestanding derivatives. The fair
value of the interest rate lock is recorded at the time the commitment to fund the mortgage loan is executed and is
adjusted for the expected exercise of the commitment before the loan is funded. In order to hedge the change in interest
rates resulting from its commitment to fund the loans, we enter into forward commitments for the future delivery of
mortgage loans when interest rate locks are entered into. We utilize a third-party model to determine the fair value of
rate lock commitments or forward sale contracts. This model uses investor bids and the probability that the rate lock
commitments will close. Net derivative assets and liabilities are recorded within other assets or other liabilities,
respectively, on the consolidated balance sheets, with changes in fair value during the period recorded within net
change in the fair value of derivative instruments on the consolidated statements of income.
Income Taxes
The Company and the Bank file a consolidated federal income tax return and a consolidated New Jersey income tax
return. The Company and the Bank file separate Pennsylvania tax returns. Income taxes are allocated to the Company
and the Bank based on the contribution of their income or use of their loss in the consolidated return. As of December
31, 2023, tax years 2020 through 2022 are subject to federal examination by the IRS and years 2019 through 2022 are
subject to state examination by various state taxing authorities. Tax regulations are subject to interpretation of the
related tax laws and regulations and require significant judgment to apply.
Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between
the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, as well as
operating loss carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply
to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect
on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the
enactment date. A valuation allowance is established against deferred tax assets when, in the judgment of management,
it is more likely than not that such deferred tax assets will not become available.
We account for income taxes in accordance with FASB ASC Topic 740-10, “Accounting for Uncertainty in Income
Taxes”, (“ASC 740”) which includes guidance related to accounting for uncertainty in income taxes, which sets out a
consistent framework to determine the appropriate level of tax reserves to maintain for uncertain tax positions. We
had no unrecognized tax benefits or accrued interest and penalties as of December 31, 2023 and 2022. We classify
interest and penalties as an element of tax expense.
Share-Based Compensation
The Company accounts for all share-based payments to be recognized as compensation expense in the consolidated
financial statements based on their fair values at the grant date. That expense will be recognized on a straight-line
basis over the period during which services are provided in exchange for the award, known as the requisite service
period (usually, the vesting period).
Recent Accounting Pronouncements
In June 2016, FASB issued Accounting Standards Update No. 2016-13, “Financial Instruments-Credit Losses (Topic
326) Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”). The amendments in ASU 2016-13
replace the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit
losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss
estimates. The amendments affect financial assets such as loans, debt securities, trade receivables, net investments in
15
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
leases, off-balance-sheet credit exposures, reinsurance receivables, and any other financial assets not excluded from
the scope that have the contractual right to receive cash.
The amendments in ASU 2016-13 require the measurement of expected credit losses to based on relevant information
about past events, including historical experience, current conditions, and reasonable and supportable forecasts that
affect the collectability of the reported amount. An entity must use judgment in determining the relevant information
and estimation methods that are appropriate in its circumstances.
As cited previously under Allowance for Credit Losses, the Company adopted the amendments in ASU 2016-13 on
January 1, 2023.
In March 2022, FASB issued ASU 2022-02 Financial Instruments - Credit Losses (Topic 326): Troubled Debt
Restructurings and Vintage Disclosures ("ASU 2022-02"). This update reduces the complexity of accounting for TDRs
by eliminating certain accounting guidance, enhancing disclosures and improving the consistency of vintage
disclosures. The Company adopted ASU 2022-02 on January 1, 2023, and it did not have a material impact on its
consolidated financial statements.
Note 3. Cash and Due from Banks
The Bank was required to maintain $50 thousand in cash reserves at its correspondent banks as of December 31, 2023
and 2022.
Note 4. Investment Securities
A comparison of amortized cost and fair value of investment securities held to maturity and securities available for
sale as of December 31, 2023 and 2022 is as follows:
As of December 31, 2023
(In thousands)
Investments HTM:
Municipal securities
Corporate bonds
Total HTM
Amortized
cost
Gross
unrecognized
gains
Gross
unrecognized
losses
Fair
value
Allowance
for credit
losses
$
$
36,545
500
37,045
$
$
-
-
-
$
$
-
-
-
$
$
36,545
500
37,045
Gross
Gross
Allowance
Amortized
cost
unrealized
gains
unrealized
losses
for credit
losses
$
$
$
$
-
-
-
Fair
value
4,954
23,746
31,602
10,230
70,532
Investments AFS:
U.S. Treasuries
U.S. government securities
Agency mortgage-backed securities
Corporate bonds
Total AFS
$
$
4,999
25,500
34,804
11,443
76,746
$
$
-
-
6
-
6
$
$
(45)
(1,754)
(3,208)
(1,213)
(6,220)
$
$
-
-
-
-
-
16
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
There was no allowance for credit losses on debt securities as of December 31, 2023.
As of December 31, 2022
(In thousands)
Investments HTM:
Municipal securities
Corporate bonds
Total
Investments AFS:
U.S. Treasuries
U.S. government securities
Agency mortgage-backed securities
Corporate bonds
Total
HTM unrecognized/ AFS unrealized
Amortized
Cost
Gross
gains
Gross
losses
Fair
value
$
$
$
$
37,614
500
38,114
14,956
30,490
42,272
11,442
99,160
$
$
$
$
-
-
-
-
-
1
-
1
$
$
$
$
-
-
-
(224)
(2,889)
(4,270)
(761)
(8,144)
$
$
$
$
37,614
500
38,114
14,732
27,601
38,003
10,681
91,017
The scheduled maturities of investment securities held to maturity and securities available for sale as of
December 31, 2023 are as follows:
(In thousands)
HTM Investments
AFS Investmemts
Amortized
Cost
Fair
value
Amortized
Cost
Fair
value
Due in one year or less
$
36,013
$
36,013
$
4,999
$
4,955
Due after one year up to five years
Due after five years up to ten years
Due after ten years
Subtotal
Agency mortgage-backed securities
532
500
-
532
500
-
37,045
37,045
-
-
26,500
24,678
9,470
973
41,942
34,804
8,551
747
38,931
31,601
Tot al
$
37,045
$
37,045
$
76,746
$
70,532
There were no proceeds from the sale of securities available for sale during 2023 and 2022, respectively. There were
no realized gains or losses in 2023 and 2022.
As of December 31, 2023 and 2022, investment securities with a market value of $82.0 million and $74.9 million,
respectively, were pledged as collateral for uninsured municipal deposits and the FHLB for potential borrowings.
17
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
The following table summarizes debt securities AFS in an unrealized loss position for which an allowance for credit
losses has not been recorded at December 31, 2023, aggregated by major security type and length of time in a
continuous unrealized loss position.
As of December 31, 2023
(In thousands)Fa
Investments AFS:
U.S. Treasuries
U.S. government securities
Agency mortgage-backed securities
Corporate bonds
Total
Less than 12 months
Gross
unrealized
losses
Number
of
positions
ir value
12 months or longer
Gross
unrealized
losses
Number
of
positions
Fair value
Total
Gross
unrealized
losses
Number
of
positions
Fair value
$
$
-
-
-
-
-
$
$
-
-
-
-
-
-
-
-
-
-
$
4,954
23,746
$
31,229
8,231
$
68,160
$
(45)
(1,754)
(3,208)
(1,213)
(6,220)
1
6
53
10
70
$
4,954
23,746
$
(45)
(1,754)
31,229
8,231
(3,208)
(1,213)
$
68,160
$
(6,220)
1
6
53
10
70
Gross unrecognized and unrealized losses and fair value, aggregated by investment category and length of time that
individual securities have been in continuous unrecognized and unrealized loss positions as of December 31, 2022 are
as follows:
As of December 31, 2022
(In thousands)
Investments HTM :
M unicipal securities
Corporate bonds
Tot al
Investments AFS:
U.S. Treasuries
U.S. government securities
Agency mortgage-backed
securities
Corporate bonds
Less than 12 months
Gross
unrecognized/
unrealized
losses
Fair value
Number
of
positions
Fair value
12 months or longer
Gross
unrecognized/
unrealized
losses
Number
of
positions
Total
Gross
unrecognized/
unrealized
losses
Number
of
positions
$
$
$
-
-
-
14,732
4,807
12,140
8,681
$
$
$
-
-
-
(224)
(183)
(578)
(761)
-$
-
-$
$
$
-
-
-
-$
$
22,794
-
(2,706)
25,553
(3,692)
-
-
-
-
-
-
6
9
-
-
-
3
1
46
10
60
Fair value
-$
-
-$
$
14,732
27,601
37,693
8,681
$
$
$
-
-
-
(224)
(2,889)
(4,270)
(761)
-
-
-
3
7
55
10
75
Tot al
$
40,360
$
(1,746)
$
48,347
$
(6,398)
15
$
88,707
$
(8,144)
Our corporate bonds are mostly comprised of financial institutions’ subordinated debt securities. Unrealized losses on
corporate bonds have not been recognized into income because the issuers’ bonds are investment grade, management
does not intend to sell, and it is likely that we will not be required to sell the security before recovery of its amortized
cost basis. The decline in fair value is largely due to changes in interest rates and other market conditions. These
financial institutions are well capitalized under the regulatory framework for prompt corrective action.
18
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
Note 5. Loans Receivable and Allowance for Credit Losses
Loans receivable consist of the following as of December 31, 2023 and 2022:
(In thousands)
Commercial real estate
Construction and land development
Commercial
Residential real estate
Consumer
Subtotal
Allowance for credit losses(9
December 31,
December 31,
2023
2022
$
$
177,062
38,815
34,077
385,841
1,242
637,037
,690)
166,721
63,756
35,184
336,911
1,037
603,609
(8,331)
Loans, net
$
627,347
$
595,278
The Bank is subject to a loans-to-one-borrower limitation of 15% of capital funds. As of December 31, 2023, the
loans-to-one-borrower limitation was $12.3 million compared to $11.1 million as of December 31, 2022. As of
December 31, 2023 and 2022, there are no loans outstanding or committed to any one borrower that individually or
in the aggregate exceed those limits.
The Bank lends primarily to customers in its local market area. Most loans are mortgage loans. Mortgage loans include
loans secured by commercial and residential real estate and construction loans. Accordingly, lending activities could
be affected by changes in the general economy, the regional economy, or real estate values. As of December 31, 2023
and 2022, mortgage loans totaled $601.7 million and $567.3 million, respectively. Mortgage loans represent 94.5%
and 94.0% of total gross loans as of December 31, 2023 and 2022, respectively.
Allowance for Credit Losses
The following table presents the activity in the allowance for credit losses by portfolio segment for the year ended
December 31, 2023:
December 31, 2023
(In thousands)
Allowance for credit losses:
Beginning balance prior to the adoption of
ASC 326
Impact of adopting ASC 326
Credit loss expense (credit)
Charge-offs
Recoveries
Ending balance
Construction
Commercial
and land
Commercial
real estate
development
and industrial
Residential
real estate
Consumer
Total
$
3,403
$
957
$
1,369
$
2,594
$
8
$
8,331
(1,442)
456
(192)
264
$
2,489
$
54
(146)
-
29
894
$
455
(688)
(213)
61
984
2,063
627
(62)
46
$
5,268
$
22
26
(4)
3
55
1,152
275
(471)
403
$
9,690
The following table details the roll forward of the allowance for loan losses and the loan portfolio disaggregated by
loan portfolio classification for the twelve-months ended December 31, 2022:
19
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
December 31, 2022
(In thousands)
Beginning balance2,8
Charge-offs
Recoveries
Provision (credit)
Ending balance
Ending balance: related to loans individually
evaluated for impairment
Ending balance: related to loans
collectively evaluated for impairment
Loan Balances
Ending balance
Ending balance: individually evaluated for
impairment
Ending balance: collectively evaluated for
impairment
Construction
Commercial
and land
Commercial
real estate
development
and industrial
Residential
real estate
Consumer
Total
$
$
$
$
$
$
$
08
(88)
177
506
3,403
452
2,951
166,721
1,168
165,553
$
$
$
$
$
$
$
825
(78)
1
209
957
-
957
63,756
1,567
62,189
$
$
$
$
$
$
$
1,387
$
1,870
$
(18)
154
(154)
1,369
732
637
35,184
732
34,452
(20)
142
602
2,594
21
2,573
336,911
1,375
335,536
$
$
$
$
$
$
$
$
$
$
$
$
16
(8)
13
(13)
8
-
8
1,037
-
1,037
$
6,906
(212)
487
1,150
8,331
1,205
7,126
603,609
4,842
598,767
$
$
$
$
$
$
The following tables details the impaired loans by loan classification as of and for the year ended December 31, 2022:
(In thousands)
With no related allowance recorded:
Commercial real estate
Construction
Commercial
Residential real estate
Total:
With an allowance recorded:
Commercial real estate
Construction and land development
Commercial
Residential real estate
Total:2,4
As of and for the year ended December 31, 2022
Unpaid
principal
balance
Recorded
investment
Related
allowance
Average
recorded
Interest
income
investment
recognized
Interest income
recognized
cash basis
$
$
$
$
1,004
2,097
-
1,062
4,163
828
-
1,550
69
47
$
$
$
$
$
$
$
656
1,567
-
990
3,213
828
-
732
69
$
$
$
-
-
-
-
-
452
-
732
21
1,629
$
1,205
$
792
1,687
106
769
3,354
64
6
642
5
717
$
$
$
$
53
$
-
-
13
66
-
-
-
-
-
$
$
$
129
11
14
56
210
-
-
-
-
-
20
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
Nonaccrual Loans
The following table presents the amortized cost basis of loans on nonaccrual status and loans past due over 89 days
still accruing as of December 31, 2023:
(In thousands)
Nonaccrual
With No
Allowance
for Credit
Loss
Nonaccrual
with
Allowance
for Credit
Loss
Loans Past
Due Over
89 Days
Still
Accruing
Commercial real estate
$
2,170
$
151
$
Construction and land development
Commercial
Residential real estate
Consumer
Tot al
-
105
804
-
1,467
173
-
-
$
3,079
$
1,791
$
-
-
-
-
-
-
The Company recognized $101 thousand of interest income on nonaccrual loans during the year ended December 31,
2023.
The following table present the recorded investment in nonaccrual and loans past due over 89 days still on accrual by
class of loans as of December 31, 2022:
(In thousands)
Nonaccrual
Loans Past
Due Over
89 Days Still
Accruing
Commercial real estate
$
Construction and land development
Commercial
Residential real estate
Consumer
Total
$
1,168
1,567
732
1,098
-
$
4,565
$
-
-
-
-
-
-
The following tables present an aging analysis of past due payments for each loan portfolio classification as of
December 31, 2023 and December 31, 2022:
December 31, 2023
(In thousands)
Commercial real estate
Construction and land development
Commercial
Residential real estate
Consumer
Total
30-59 Days
Past Due
$
1,872
-
35
1,655
3
3,565
$
60-89 Days
Past Due
$
-
-
88
-
-
88
$
90+ Days
Past Due
$
1,869
1,467
604
501
-
4,441
$
Total
Past Due
$
3,741
1,467
727
2,156
3
8,094
$
Loans Not
Past Due
$
173,321
37,348
33,350
383,685
1,239
628,943
$
Total
177,062
38,815
34,077
385,841
1,242
637,037
$
$
21
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
December 31, 2022
(In thousands)
Commercial real estate
Construction and land development
Commercial250
Residential real estate
Consumer
Total
30-59 Days
Past Due
290
$
-
64
-
604
$
60-89 Days
Past Due
2,660
$
-
-
316
-
2,976
$
90+ Days
Past Due
$
-
1,567
893
741
-
3,201
$
Total
Past Due
2,950
$
1,567
1,143
1,121
-
6,781
$
Loans Not
Past Due
163,771
$
62,189
34,041
335,790
1,037
596,828
$
Total
166,721
63,756
35,184
336,911
1,037
603,609
$
$
Loan Modifications to Borrowers Experiencing Financial Difficulty
On January 1, 2023, the Corporation adopted ASU 2022-02. Loan modifications reported below do not include
modifications with insignificant payment delays. Occasionally the Company modifies loans to borrowers in financial
distress by providing a modification to their original loan terms. The modification can include principal forgiveness,
a term extension, an other-then-insignificant payment delay or an interest rate reduction. When principal forgiveness
is granted, the amount of forgiveness is charged-off against the ACL.
In some cases, the Company provides multiple types of concessions on one loan. For the loans included in the
combination columns below multiple types of modifications have been made on the same loan within the current
reporting period.
The following table presents the amortized cost basis of loans at December 31, 2023 that were both experiencing
financial difficulty and modified during the year ended December 31, 2023, by class and by type of modification. The
percentage of the amortized cost basis of loans that were modified to borrowers in financial distress as compared to
the amortized cost basis of each class of financing receivable is also presented below.
(In thousands)
Commercial real estate
Commercial
Construction and land development
Residential real estate
Consumer
Total
Principal
Forgiveness
-
$
-
-
-
-
-
$
Payment
Delay
$
$
315
-
-
419
-
734
Term
Extension
-
$
59
-
-
-
59
$
Interest Rate
Reduction
43
$
-
-
-
-
43
$
Combination Combination
Term
Term
$
Payment
Delay
Extension and Extension and
Interest Rate
Reduction
654
$
37
-
-
-
691
483
-
-
125
-
608
$
$
Total
Class of
Financing
Receivable
0.8%
0.2%
0.0%
0.1%
0.0%
0.3%
There are no commitments to lend additional amounts to the borrowers included in the previous table.
We closely monitor the performance of the loans that are modified to borrowers experiencing financially difficulty to
understand the effectiveness of our modification efforts. Only one modified commercial loan in the amount of $59
thousand was past due for 81 days as of December 31, 2023.
Credit Quality Indicators
We categorize loans into risk categories based on relevant information about the ability of borrowers to service their
debt such as: current financial condition, repayment sources, payment history and value of collateral. Commercial,
22
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
commercial real estate, and construction and development loans are evaluated annually or when credit deficiencies
arise, such as delinquent loan payments. Credit quality risk ratings include the following regulatory classifications:
Special Mention – Loans classified as special mention have a potential weakness that deserves management’s close
attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the
loan or of the bank’s credit position at some future date.
Substandard – Loans classified as substandard are inadequately protected by the current net worth and payment
capacity of the obligor or of the collateral pledged, if any. Substandard loans have a well-defined weakness or
weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the bank
will sustain some loss if the deficiencies are not corrected.
Doubtful – Loans classified as doubtful have all weaknesses inherent in those classified as substandard, with the added
characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts,
conditions, and values, highly questionable, and improbable.
Loans not classified as special mention, substandard, or doubtful are pass-rated loans.
The following table summarizes designated internal risk categories by portfolio segment and loan class, by origination
year, in the current period:
Term Loans Amortized Cost Basis by Origination Year
Revolving
Revolving
Loans
Loans
Amortized
Converted
2023
2022
2021
Prior
Cost Basis
To Term
Total
(In thousands)
As of December 31, 2023
Commercial real estate
Pass
Special mention
Substandard
$
16,376
$
47,582
$
43,126
$
63,374
-
-
-
-
499
3,618
1,478
438
Tot al commercial real estate loans
$
16,376
$
47,582
$
47,243
$
65,290
Commercial real estate
Current period gross write offs
$
-
$
-
$
-
$
192
$
$
$
571
-
-
571
-
Construction and land development
Pass
Special mention
Substandard
$
19,623
$
15,355
$
4,476
$
2,364
$
4,225
-
-
-
-
-
-
-
1,467
-
-
Tot al construction and land development
$
19,623
$
15,355
$
4,476
$
3,831
$
4,225
Construction and land development:
Current period gross write offs
$
-
$
-
$
-
$
-
$
-
23
$
$
$
$
$
$
-
-
-
-
-
-
-
-
-
-
$
171,029
1,977
4,056
$
177,062
$
192
$
46,043
-
1,467
$
47,510
$
-
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
Term Loans Amortized Cost Basis by Origination Year
Revolving
Revolving
Loans
Loans
Amortized
Converted
(In thousands)
2023
2022
2021
Prior
Cost Basis
To Term
Total
As of December 31, 2023 (cont.)
Commercial
Pass
Special mention
Substandard
$
2,378
$
5,613
$
1,845
$
12,607
$
10,926
-
-
-
200
-
1
35
-
66
406
Tot al commercial
$
2,378
$
5,813
$
1,846
$
12,642
$
11,398
Commercial:
Current period gross write offs
$
45
$
-
$
168
$
-
$
-
$
$
$
-
-
-
-
-
$
33,369
101
607
$
34,077
$
213
The Company considers the performance of the loan portfolio and its impact on the ACL. For residential and consumer
loan classes, we also evaluate credit quality based on the aging status of the loan, which was previously presented,
and by payment activity. The following table presents the amortized cost in residential and consumer loans based on
payment activity:
Term Loans Amortized Cost Basis by Origination Year
Revolving
Revolving
Loans
Loans
Amortized
Converted
2023
2022
2021
Prior
Cost Basis
To Term
Total
$
$
$
$
$
$
1,074
$
385,038
163
803
1,237
$
385,841
-
-
-
-
-
$
62
$
$
$
1,242
-
1,242
4
As of December 31, 2023
Residential real estate
Payment performance
Performing
Nonperforming
$
56,213
$
83,996
$
74,802
$
83,450
$
85,503
-
136
-
404
100
Total residential real estate
$
56,213
$
84,132
$
74,802
$
83,854
$
85,603
Residential real estate:
Current period gross write offs
Consumer
Payment performance
Performing
Nonperforming
Total consumer
Consumer:
Current period gross write offs
$
$
$
$
-
$
-
$
-
$
62
$
-
8
-
8
-
$
$
$
665
-
665
-
$
$
$
40
-
40
-
$
$
$
482
-
482
4
$
$
$
47
-
47
-
24
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
The following tables present risk ratings for each loan portfolio classification as of December 31, 2022
December 31, 2022
(In thousands)Pass
Commercial real estate
Construction and land development
Commercial34,343
$
164,961
60,013
Total
$
259,317
Special
Mention
$
592
2,176
109
2,877
$
Substandard
$
Doubtful
$
-
-
-
-
$
Non-accrual
$
1,168
1,567
732
3,467
$
Total
166,721
63,756
35,184
265,661
$
$
-
-
-
-
$
The following tables present the recorded investment in residential and consumer loans based on payment activity:
December 31, 2022
(In thousands)
Residential real estate
Consumer
Performing
335,813
$
933
336,746
$
Nonaccrual
1,098
$
-
1,098
$
Total
336,911
1,037
337,948
$
$
Total
Note 6. Premises and Equipment, Net
Premises and equipment as of December 31, 2023 and 2022 are summarized as follows (dollars in thousands):
(In thousands)
Land
Buildings and leasehold improvements
Furniture, fixtures and equipment
Premises and equipment, gross
Less accumulated depreciation and amortization
Premises and equipment, net
Estimated
Useful Lives
5 - 35 years
3 - 10 years
As of December 31,
2023
2022
$
122
1,232
2,370
3,724
$
122
1,104
2,134
3,360
(1,954)
(1,515)
$
1,770
$
1,845
Depreciation expense was $487 thousand and $323 thousand for the years ended December 31, 2023 and 2022,
respectively, and is recorded in occupancy and equipment expenses.
25
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
Note 7. Deposits
Deposits consist of the following major classifications as of December 31, 2023 and 2022:
(Dollars in thousand)
Non-interest checking
Interest checking
Money market deposits
Savings deposits
Certificates of deposit ($250 and over)
Certificates of deposit (less than $250)
Brokered deposits
Total deposits
As of December 31,
2023
2022
$
69,435
$
85,716
378,140
332,032
14,597
49,190
22,612
72,471
80,999
49,952
68,987
25,518
61,397
47,450
$
687,444
$
671,052
The Bank has a concentration of deposits from local municipalities. Municipal deposits, which are mostly
interest-checking accounts, were $309.1 million or 45.0% of total deposits as of December 31, 2023, and $298.7
million or 44.5% of total deposits as of December 31, 2022. Municipal deposit accounts in excess of $250 thousand
are collateralized by investment securities with a market value of $82.0 million as of December 31, 2023 and a $173.0
million FHLB Municipal Letter of Credit.
Interest expense on deposits consisted of the following for the years ended December 31, 2023 and 2022:
(In thousands)
Interest checking
Money market deposits
Savings deposits
Certificates of deposit
2023
2022
$
4,833
$
481
411
5,300
781
244
314
1,353
2,692
Total interest expense on deposits
$
11,025
$
The following is a schedule of certificates of deposit, which includes the brokered deposits, by maturities as of
December 31, 2023:
(In thousands)
2024
2025
2026
2027
2028
As of
December 31, 2023
$
168,358
4,707
2,606
409
2
Total certificates of deposits
$
176,082
26
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
Note 8. Borrowing Availability
Federal Home Loan Bank
The Bank is a member of the FHLB of New York and has access to overnight and term advances. As of December
31, 2023, we had $173.0 million in short-term municipal letters of credit outstanding and $33.0 million in additional
borrowing capacity. The FHLB line of credit is secured with residential and commercial mortgage loans totaling
$253.5 million. As of December 31, 2022, we had $165.0 million in short-term municipal letters of credit outstanding
and $33.5 million in additional borrowing capacity. The FHLB line of credit is secured with residential and
commercial mortgage loans totaling $240.2 million. As of December 31, 2023, $0 million was outstanding against the
FHLB line of credit compared to $33 million, with an interest rate of 4.61%, as of December 31, 2022. The average
balance of FHLB advances was $4.0 million and $9.4 million for 2023 and 2022, respectively, with average rates paid
of 4.33% and 3.09% for the respective periods.
Federal Reserve Bank
As of December 31, 2023, we had $140.4 million in borrowing capacity at the FRB. The FRB line of credit is secured
with commercial, construction and residential and commercial mortgage loans totaling $195.6 million. As of
December 31, 2022, we had $114.1 million in borrowing capacity at the FRB. The FRB line of credit is secured with
commercial, construction and residential and commercial mortgage loans totaling $170.7 million. As of December
31, 2023, $53.6 million, with an interest rate of 5.50%, was outstanding against the FRB line of credit compared to $0
as of December 31, 2022. The average balance of FRB advances was $17.8 million and $125 thousand for 2023 and
2022, respectively. For 2023 the average rate paid was 5.34% compared to 4.50% for 2022.
Subordinated Debt
On August 26, 2020, the Company issued $10.750 million of 7.00% fixed-to-floating rate subordinated notes with a
maturity date of September 1, 2030. The subordinated notes, which qualify as Tier 2 capital, bear interest at an annual
rate of 7.00%, payable semi-annually in arrears and a floating rate of interest equivalent to the 3-month Secured
Overnight Financing Rate (SOFR) plus 6.89% payable quarterly in arrears commencing on September 1, 2025. The
subordinated debt issuance costs of approximately $359 thousand are being amortized over five years on a straight-
line basis into interest expense. The carrying value of subordinated debt was $10.6 million as of December 31, 2023
and December 31, 2022.
Other Lines of Credit
As of December 31, 2023 and 2022, the Bank had an unsecured line of credit with Atlantic Community Bankers Bank
(“ACBB”) in the aggregate amount of $8.0 million. As of December 31, 2023, $0 was outstanding against the ACBB
line of credit compared to $1.8 million, with an interest rate of 4.75% as of December 31, 2022. The average balance
of the ACBB line was $20 thousand and $146 thousand for 2023 and 2022, respectively, with average rates paid of
5.33% and 1.48% for the respective periods..
As of December 31, 2023 and 2022, 1st Colonial Bancorp, Inc. had a secured line of credit with ACBB in the aggregate
amount of $2.5 million. The ACBB line is secured with 100% of the voting stock of 1st Colonial Community Bank.
As of December 31, 2023 and 2022, there were no outstanding balances against this line.
27
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
Note 9. Earnings Per Share
The following is a reconciliation of the numerators and denominators of the basic and diluted earnings per share
calculation for the years ended December 31, 2023 and 2022:
(In thousands, except for per share data)
2023:
Basic earnings per share
Effect of dilutive stock equivalents
Diluted earnings per share
2022:
Basic earnings per share
Effect of dilutive stock equivalents
Diluted earnings per share
Net
Income
Average
shares
Per share
Amount
$
$
$
$
7,431
-
7,431
8,498
-
8,498
4,705,189
122,604
4,827,793
4,681,122
145,062
4,826,184
$
$
$
$
1.58
(0.04)
1.54
1.82
(0.06)
1.76
Basic earnings per share is calculated on the basis of weighted average number of shares outstanding. Diluted earnings
per share is calculated on the basis of weighted average number of shares outstanding and common stock equivalents
(“CSEs”) that would arise from the exercise of dilutive securities. For 2023, the Company granted a total of 57,728
restricted stock unit awards, which are considered CSEs. Options to purchase 278,232 and 373,132 shares of common
stock were outstanding as of December 31, 2023 and 2022, respectively. There were no antidilutive options excluded
from the earnings per share calculations for 2023 and 2022.
Note 10. Derivative and Hedging Activity
Commitments to fund certain fixed rate mortgage loans (interest rate lock commitments) to be sold in the secondary
market and forward commitments for the future delivery of mortgage loans to third party investors are considered
derivatives. During 2022 we began the practice of entering into forward commitments for the future delivery of
residential mortgage loans when interest rate lock commitments are entered into in order to economically hedge the
effect of changes in interest rates resulting from our commitments to fund the loans. Interest rate lock commitments
and forward sales commitments are recorded within other assets and/or other liabilities on the consolidated balance
sheets, with changes in fair values recorded within gains on sale of mortgage loans on the consolidated statements of
operations.
28
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
The following table reflects the amount and fair value of mortgage banking derivatives included in the Consolidated
Balance Sheet as of December 31, 2023 and 2022.
(In thousands)
Amount
ValueAm
ount
Value
December 31, 2023
December 31, 2022
Included in other assets
Interest Rate Lock Commitments
Forward commitments
Total included in other assets
$
$
Included in other liabilities
Interest Rate Lock Commitments
Forward commitments
Total included in other liabilities
$
3,149
-
3,149
-
3,000
3,000
$
$
$
Note 11. Fair Value of Financial Instruments
94
-
94
-
21
21
$
$
$
2,351
2,250
4,601
-
-
-
$
$
$
54
10
64
-
-
-
Under FASB ASC Topic 820 “Fair Value Measurements and Disclosures” (“ASC Topic 820”), fair values are based
on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between
market participants at the measurement date. When available, management uses quoted market prices to determine
fair value. If quoted prices are not available, fair value is based upon valuation techniques such as matrix pricing or
other models that use, where possible, current market-based or independently sourced market parameters, such as
interest rates. If observable market-based inputs are not available, we use unobservable inputs to determine appropriate
valuation adjustments using discounted cash flow methodologies.
Management uses its best judgment in estimating the fair value of our financial instruments; however, there are
inherent weaknesses in any estimation technique. The estimated fair value amounts have been measured as of their
respective period end and have not been re-evaluated or updated for purposes of these financial statements subsequent
to those respective dates. As such, the estimated fair values of these financial instruments subsequent to the respective
reporting dates may be different than the amounts reported at each period-end.
ASC Topic 820 provides guidance for estimating fair value when the volume and level of activity for an asset or
liability has significantly declined and for identifying circumstances when a transaction is not orderly. ASC Topic 820
establishes a fair value hierarchy that prioritizes the inputs to valuation methods used to measure fair value. The
hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities
(Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of
the fair value hierarchy under ASC Topic 820 are as follows:
Level 1:
Level 2:
Unadjusted quoted prices in active markets that are accessible at the measurement date for
identical, unrestricted assets or liabilities.
Quoted prices in markets that are not active, or inputs that are observable either directly or
indirectly, for substantially the full term of the asset or liability. Level 2 includes debt
securities with quoted prices that are traded less frequently then exchange-traded instruments.
Valuation techniques include matrix pricing which is a mathematical technique used widely
in the industry to value debt securities without relying exclusively on quoted market prices
for the specific securities but rather by relying on the securities’ relationship to other
benchmark quoted prices.
29
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
Level 3:
Prices or valuation techniques that require inputs that are both significant to the fair value
measurement and unobservable (i.e., supported with little or no market activity).
A financial instrument’s level within the fair value hierarchy is based on the lowest level of input that is significant to
the fair value measurement. We did not have transfers of financial instruments within the fair value hierarchy during
the years ended December 31, 2023 and 2022.
Items Measured on a Recurring Basis
Fair value for Level 1 securities is determined by obtaining quoted market prices in active markets. U.S. Treasuries
are classified as Level 1.
Level 2 securities include obligations of U.S. government-sponsored agencies and debt securities with quoted prices,
which are traded less frequently than exchange-traded instruments, whose value is determined using matrix pricing
with inputs that are observable in the market or can be derived principally from or corroborated by observable market
data. The prices were obtained from third party vendors. This category generally includes our mortgage-backed
securities and CMOs issued by U.S. government and government-sponsored agencies, and corporate bonds.
Additionally, the fair value of our forward commitments is based on market pricing and is classified as Level 2.
Level 3 includes our interest rate lock commitments. The determination of fair value of includes assumptions, that are
significant and unobservable, about the probability that the loans behind the rate lock commitments will close.
Items Measured on a Nonrecurring Basis
Loans individually evaluated are based on the fair value of the underlying collateral, less costs to sell. When the
collateral value less costs to sell is less than the carrying value of the loan, a specific reserve (valuation allowance) is
established. OREO is carried at the lower of cost or fair value. Fair value is based upon independent market prices,
appraised values of the collateral or management’s estimation of the value of the real estate. These assets are included
as Level 3 fair values, based upon the lowest level of input that is significant to the fair value measurements.
For financial assets measured at fair value on a recurring and nonrecurring basis, the fair value measurements by level
within the fair value hierarchy used as of December 31, 2023 and December 31, 2022 are as follows:
30
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
Fair Value M easurements Using:
Quoted Prices
in Active
Significant
M arkets for
Other
Significant
Identical
Observable
Unobservable
Assets
Level 1
Inputs
Level 2
Inputs
Level 3
Total
$
4,954
$
-
$
-
-
-
-
-
-
-
-
-
23,746
31,602
10,230
3,619
-
3,619
$
21
21
-
-
$
$
$
$
$
$
$
$
$
$
$
$
$
$
-
-
-
-
-
94
94
-
-
5,502
5,502
$
$
$
$
$
$
4,954
23,746
31,602
10,230
70,532
3,619
94
3,713
21
21
5,502
5,502
As of December 31, 2023
(In thousands)
Asset s measured at fair value on a recurring basis
Investment securities:
U.S. Treasuries
U.S. government agencies
Agency mortgage-backed securities
Corporate bonds
Tot al investments AFS4,954
65,578
Mortgage loans held for sale
Interest rate lock commitments
Total assets measured at fair value on a recurring basis
Liabilities measured at fair value on a recurring basis
Forward commitments
Total liabilities measured at fair value on a recurring basis
Assets measured at fair value on a non-recurring basis
Individually evaluated loans
Total assets measured at fair value on a non-recurring basis
31
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
As of December 31, 2022
(In thousands)
Assets measured at fair value on a recurring basis
Investment securities:
U.S. Treasuries
U.S. government agencies
Agency mortgage-backed securities
Corporate bonds
Tot al investments AFS
Mortgage loans held for sale
Interest rate lock commitments
Forward commitments
Fair Value M easurements Using:
Quoted Prices
in Active
Significant
M arkets for
Other
Significant
Identical
Observable
Unobservable
Assets
Level 1
Inputs
Level 2
Inputs
Level 3
Total
$
14,732
$
-
$
-
-
-
14,732
-
-
-
27,601
38,003
10,681
76,285
6,710
-
10
-
-
-
-
-
-
54
-
54
$
14,732
27,601
38,003
10,681
91,017
6,710
54
10
$
97,791
Total assets measured at fair value on a recurring basis
$
14,732
$
83,005
$
Assets measured at fair value on a non-recurring basis
Loans indiviually measured for impairment
Total assets measured at fair value on a non-recurring basis
$
$
-
-
$
$
-
-
$
$
4,842
4,842
$
$
4,842
4,842
The following tables present additional quantitative information about assets measured at fair value on a nonrecurring
basis and for which we have utilized Level 3 inputs to determine fair value as of December 31, 2023 and December
31, 2022:
As of December 31, 2023
(Dollars in thousands)
Valuation
Unobservable
Fair Value
Techniques
Input
Range of
Inputs
Weighted
Average
Individually evaluated loans
$
5,502
Appraisal
Liquidation expenses
0%-17.8% discount
13.39%
Qualitative Information about Level 3 Fair Value M easurements
of collateral
As of December 31, 2022
(Dollars in thousands)
Valuation
Unobservable
Fair Value
Techniques
Input
Range of
Inputs
Weighted
Average
Loans indiviually measured for impairment
$
4,842
Appraisal
Liquidation expenses
0%-12.9% discount
6.82%
Qualitative Information about Level 3 Fair Value M easurements
of collateral
32
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
The estimated fair value of the Company’s financial instruments as of December 31, 2023 and 2022 was as follows:
Fair Value M easurements
As of December 31, 2023
Quoted Prices
in Active
Significant
M arkets for
Other
Significant
Identical
Observable
Unobservable
(In thousands)
Financial Assets:
Carrying
value
Estimated
fair value
Assets
Level 1
Inputs
Level 2
Inputs
Level 3
Cash and cash equivalents
$
Investments held to maturity
Investments available for sale
Restricted bank stock, at cost
M ortgage loans held for sale
52,728
37,045
70,532
1,457
3,619
$
52,728
37,045
70,532
NA
3,619
Loans receivable, net
627,347
577,512
Interest rate lock commitments
Accrued interest receivable
Financial liabilities:
Demand deposits
M oney market deposits
Savings deposits
Certificates of deposit
Subordinated debt, net
Other borrowings
Forward commitments
Accrued interest payable
94
3,431
447,575
14,597
49,190
176,082
10,631
53,600
21
668
94
3,431
447,575
14,597
49,190
176,779
9,819
53,600
21
668
$
52,728
$
-
$
-
-
-
-
-
-
-
-
-
-
-
-
-
-
36,545
70,532
-
3,619
-
-
-
447,575
14,597
49,190
176,779
9,819
53,600
21
668
-
500
-
NA
-
577,512
94
3,431
-
-
-
-
-
-
-
-
33
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
Fair Value M easurements
As of December 31, 2022
Quoted Prices
in Active
Significant
M arkets for
Other
Significant
Identical
Observable
Unobservable
(In thousands)
Financial Assets:
Carrying
value
Estimated
fair value
Assets
Level 1
Inputs
Level 2
Inputs
Level 3
Cash and cash equivalents
$
Investments held to maturity
Investments available for sale
Restricted bank stock, at cost
M ortgage loans held for sale
20,399
38,114
91,017
2,894
6,710
$
20,399
38,114
91,017
NA
6,710
Loans receivable, net
595,278
548,529
Interest rate lock commitments
Forward commitments
Accrued interest receivable
Financial liabilities:
Demand deposits
M oney market deposits
Savings deposits
Certificates of deposit
Subordinated debt, net
Other borrowings
Accrued interest payable
54
10
2,779
417,748
49,952
68,987
134,365
10,559
34,788
405
54
10
2,779
417,748
49,952
68,987
134,881
9,773
34,792
405
$
20,399
$
-
$
-
-
-
-
-
-
-
-
-
-
-
-
-
-
37,614
91,017
-
6,710
-
-
10
-
417,748
49,952
68,987
134,881
9,773
34,792
405
-
500
-
NA
-
548,529
54
-
2,779
-
-
-
-
-
-
34
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
Note 12. Income Taxes
The components of income tax expense (benefit) are stated below:
(In thousands)
Income tax expense (benefit)
For the years ended December 31,
2023
2022
Federal
Current
Deferred
State
Current
Deferred
$
$
1,832
(110)
1,722
692
69
761
Total income tax expense
$
2,483
$
1,731
57
1,788
1,098
9
1,107
2,895
The following is a reconciliation between expected tax expense at the statutory rate of 21% for 2023 and 2022 and
actual tax expense:
(In thousands)
For the years ended December 31,
2023
2022
Computed tax expense at statutory rate
$
2,082
$
2,393
Adjustments resulting from:
State tax, net of federal benefit
Tax-exempt interest income
Bank owned life insurance
Stock-based compensation
Other
601
(206)
(21)
(14)
41
875
(97)
(303)
(3)
30
Income tax expense2,483
$
$
2,895
35
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
Significant deferred tax assets and liabilities of the Bank as of December 31, 2023 and 2022 are as follows:
(In thousands)
Deferred tax assets:
As of December 31,
2023
2022
Allowance for loan losses
$
2,556
$
Deferred rent
Unrealized losses on AFS debt securities
Share-based compensation cost
Unfunded loan commitments
Non-accrual interest
Other
Deferred tax assets
Deferred tax liabilities:
Depreciation
Prepaid expenses
Deferred loan costs
Total deferred tax liabilities
Net deferred tax asset, included in other
assets
38
1,639
151
261
12
10
4,667
(380)
(18)
(555)
(953)
2,304
11
2,234
134
157
9
11
4,860
(459)
(31)
(545)
(1,035)
$
3,714
$
3,825
The realizability of deferred tax assets is dependent upon various factors, including the generation of future taxable
income, the existence of taxes paid and recoverable, the reversal of deferred tax liabilities, and tax planning strategies.
In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some
portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent
upon the generation of future taxable income during the periods in which the net operating loss carryforwards are
available and the temporary differences representing net future deductibles reverse. Based upon these and other factors
management has determined that it is more likely than not that the Company will realize the benefits of the deferred
tax assets that exist as of December 31, 2023.
As of December 31, 2023 and 2022, the Company had no material unrecognized tax benefits or accrued interest and
penalties. The Company’s policy is to account for interest as a component of interest expense and penalties as a
component of other expense.
As of December 31, 2023, the years 2020 – 2022 are open for federal examination and years 2019-2022 are open for
state examinations.
Note 13. Leases
The Company has operating leases for a retail branch, our operation and administration center (main office) and certain
equipment. On commencement date of a new lease, the Company recognizes a ROU asset, which represents the right
to use an underlying asset for the lease term, and a lease liability, which represents an obligation to make lease
payments arising from the lease. The ROU assets are included in other assets and lease liabilities are included in other
liabilities. No new leases were executed in 2023. During 2022 we executed a new lease for the main office and
relocated to Mount Laurel, New Jersey in November. The new lease is for 92 months. Additionally, we extended the
Collingswood location’s lease for another five years. The Company’s leases have remaining lease terms of one month
to 7.5 years, some of which include options to extend the leases for up to five years. Because we may need to expand
our office space, the extension options were excluded from the calculations of the ROU asset and lease liability.
36
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
The following table presents the ROU assets and the lease liability for the years ended December 31, 2023 and 2022.
(In thousands)
ROU asset
Lease liabilitity1,8
For the years ended December 31,
2023
2022
$
$
1,667
12
$
$
1,971
2,011
The following table presents operating lease costs for the years ended December 31, 2023 and 2022.
(In thousands)
Operating lease cost
For the years ended December 31,
2023
2022
$
$
413
413
$
$
323
323
A maturity analysis of operating lease liabilities and reconciliation of the undiscounted cash flows to the total of
operating lease liabilities is as follows:
(In thousands)
As of December 31,
2023
2022
2023
2024
2025
2026
2027
Thereafter
Total lease payments
Less imputed interest
$
$
361
432
354
347
256
400
2,150
(338)
308
361
432
354
347
655
2,457
(446)
Total
$
1,812
$
2,011
Note 14. Commitments and Contingencies
Financial Instruments with Off-Balance-Sheet Risk
The Bank is a party to financial instruments with off-balance-sheet risk in the normal course of business. These
financial instruments include commitments to extend credit to meet the financing needs of its customers. Such
commitments have been made in the normal course of business and at current prevailing market terms. The
commitments, once funded, are principally to originate commercial loans and other loans secured by real estate. The
Bank uses the same credit policies in making commitments and conditional obligations as it does for on-balance-sheet
instruments.
37
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
Commitments issued to potential borrowers of the Bank as of December 31, 2023 and 2022 were as follows:
(In thousands)
Fixed rate commitments
Variable/adjustable rate commitments
Total commitments
Legal Proceedings
As of December 31,
2023
2022
$
$
2,805
137,350
140,155
$
$
4,291
133,994
138,285
Within the normal course of business, the Company may be a party to various claims or legal proceedings.
Management is not aware of any litigation that would have a material adverse effect on the consolidated financial
statements. There are no proceedings pending other than routine litigation incident to the business of the Company.
Note 15. Related-Party Transactions
Directors and executive officers of the Company, including their immediate families and companies in which they
have a direct or indirect material interest, are considered to be related parties. In the ordinary course of business, the
Company engages in various related party transactions, including extending credit and deposit accounts. Federal
banking regulations require that any extensions of credit to insiders and their related interests not be offered on terms
more favorable than would be offered to non-related borrowers of similar creditworthiness. The Company relies on
the directors and executive officers for the identification of their associates.
The aggregate amount of loans to related parties was $1.1 million and $1.0 million as of December 31, 2023 and 2022,
respectively. During 2023 and 2022, new loans and credit line advances to such related parties amounted to $296
thousand and $335 thousand, respectively, and repayments amounted to $26 thousand and $13 thousand, respectively.
Approximately $125 thousand is no longer classified as related party due to a change in composition of related parties.
The aggregate amount of deposits from related parties was $27.3 million and $51.1 million as of December 31, 2023
and 2022, respectively.
The Bank engaged in certain property inspection and construction services with an entity that is affiliated with a
director of the Bank. Such aggregate services amounted to fees of $14 thousand and $20 thousand for the years ended
December 31, 2023 and 2022, respectively. In management’s opinion, the terms of the services provided were
substantially equivalent to that which would have been obtained from unaffiliated parties.
Note 16. Employee Benefits
The Bank instituted a qualified defined contribution plan (‘the 401(K) Plan”) for all current employees in August 2005.
All eligible employees are 100% vested in any required safe harbor contributions. The Bank made safe harbor
contributions in the amount of $293 thousand and $289 thousand during 2023 and 2022, respectively.
Note 17. Share-Based Compensation
During 2020, the shareholders approved the 1st Colonial Bancorp, Inc. 2020 Equity Incentive Plan (“2020 Equity
Plan”). The Board of Directors approved the 2020 Equity Plan for the purpose of enabling the Company to continue
to recruit and retain highly qualified personnel, to provide those personnel with an incentive for productivity, and to
provide those personnel with an opportunity to share in the growth and value of the Company. Accordingly, the board
of directors has reserved 400,000 shares of our common stock for issuance upon the grant or exercise of awards
pursuant to the 2020 Equity Plan. The Board of Directors believes that the shares authorized by the 2020 Equity Plan
are needed to ensure the continued availability of equity-based compensation and that the 2020 Equity Plan will
enhance the effectiveness of the Bank’s equity compensation program by authorizing the award of restricted stock and
the use of other stock-based compensation techniques. The exercise price of options granted under this program is
required to be equal to at least the fair market value of common stock as of the grant date. The 2020 Equity Plan allows
for the Compensation Committee of the Board of Directors to determine the type of incentive to be awarded, its term,
38
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
vesting and restrictions on shares. As of December 31, 2023, 286,228 options and restricted stock units were
outstanding under this plan.
Compensation expense for equity grants is recognized over the requisite service period. During 2023 and 2022, we
recognized $369 thousand and $265 thousand, respectively, in compensation expense for equity grants. As of
December 31, 2023, approximately $1.2 million remained to be recognized in compensation expense over a weighted-
average period of approximately three years.
The authorization of the 2020 Equity Plan terminated two other stock option programs, the 2013 Outside Director
Plan and the 2013 Employee Stock Option Plan. No new options or awards will be granted under the 2013 Plans.
Under the 2013 Outside Director Plan, 92,187 options remain outstanding as of December 31, 2023 for nonemployee
directors. The exercise price of options granted under this program was required to be equal to at least the fair market
value of common stock as of the grant date. All options granted under this plan vest in five equal annual installments
or upon retirement. These options expire 10 years from the grant date.
Under the 2013 Employee Stock Option Plan, 14,745 options remain outstanding as of December 31, 2023 for key
employees. The exercise price of options granted under this program was equal to at least the fair market value of
common stock as of the grant date. All options granted under this plan vest in five equal annual installments, upon
retirement or a change in control of the Company. These options expire 10 years from the grant date.
The fair value of each stock option award is estimated on the date of the grant using the Black-Scholes option-pricing
model. The risk-free interest rate for the expected term of the stock option awarded is based on the U.S. Treasury
yield curve in effect at the time of the grant. The volatility of the Company’s stock is based on a combination of
historical volatility and peer data over a span of time equal to the expected life of stock option awards, which is the
period of time the Company estimates that stock options granted will remain outstanding. The simplified method
averages an award’s weighted average vesting period and its contractual term. There were no stock option awards
granted in 2023 and 2022.
A summary status of the Company’s stock option plans as of December 31, 2023 and 2022, and the changes during
the years then ended, is as follows:
2023
2022
Weighted
Weighted
(1)
Average
Exercise
Price
Options
Average
Aggregate
Remaining
Intrinsic
Term (yrs)
Value
Options
Weighted
Average
Exercise
Price
Options outstanding at beginning of year
373,132
$
7.60
5.7
407,592
$
7.58
Granted
Exercised
Forfeited or expired(36,077)
8.21
-
(58,823)
Options outstanding at the end of the year
Options exercisable at the end of the year
278,232
180,532
$
$
-
5.20
8.02
7.73
-
(18,160)
(16,300)
373,132
220,432
$
$
-
5.77
9.33
7.60
7.01
5.4
4.4
$
$
1,148
799
(1) The aggregate intrinsic value of a stock option in the table above (shown in thousands) represents the total
pre-tax intrinsic value (the amount by which the current market value of the underlying stock exceeds the
exercise price of the option) that would have been received by the option holders had they exercised their
options on December 31, 2023. The intrinsic value varies based on the changes in the market value in the
Company’s stock.
The Company issues new shares upon the exercise of stock options.
39
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
The following table provides detail for non-vested stock options under the 2020 Equity Plan as of December 31, 2023:
Weighted
Average
Exercise
Price
Options
Non-vested options December 31, 2022
152,700
$
8.44
Granted
Forfeited
Vested
-
(22,500)
(32,500)
Non-vested options December 31, 2023
97,700
$
-
7.21
8.90
8.57
The following table summarizes the activity for the Company’s restricted stock unit awards as of December 31, 2023:
Outstanding as of December 31, 2022
Granted
Forfeited
Vested
Weighted
Restricted
Average
stock
units
77,786
57,728
(6,534)
(14,052)
Fair
Value
$
10.58
11.46
11.34
10.34
Outstanding as of December 31, 2023
114,928
$
11.01
Note 18. Shareholders’ Equity and Regulatory Capital
Shareholders’ Equity
In November 2021, the Company announced and adopted a stock repurchase program that was completed in May
2022 with a total of 193,381 shares repurchased for a cost of $2.0 million, or an average cost of $10.30 per share.
Under this repurchase program 114,500 shares were purchased in 2021 and 78,881 shares were repurchased in 2022.
On August 8, 2023, the Company announced and adopted another stock repurchase program that will expire in July
2024. As of December 31, 2023 640 shares were repurchased for a cost of $8 thousand.
Dividend Policy
Company
The Company has not paid a cash dividend since its inception in June 2000. Any payment of cash dividends to its
shareholders would be dependent on the payment of a cash dividend from the Bank to the Company. The payment of
cash dividends by the Bank to the Company is limited under federal banking law. The Company’s future dividend
policy is subject to the discretion of its board of directors and will depend upon a number of factors, including future
earnings, financial conditions, cash needs, and general business conditions. Holders of common stock will be entitled
to receive dividends as and when declared by the board of directors out of funds legally available for that purpose.
Bank
The amount of dividends that may be paid by the Bank depends upon the Bank’s earnings and capital position, and is
limited by New Jersey and federal law, regulations, and policies. As a state-chartered bank subject to New Jersey and
FDIC regulations, the Bank cannot pay any dividend if the dividend would reduce the required surplus of the Bank as
40
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
defined in New Jersey statutes. As a matter of policy, the FDIC expects state banks to follow the national bank dividend
limits, which allow a bank to pay dividends up to the amount of net profits of the current year plus the retained net
profits from the last two years. Amounts in excess of that would require prior approval of the FDIC. In addition, the
FDIC and the state of New Jersey have authority to further limit any dividends to be paid by the Bank in a specific
case. No specific dividend restrictions have been imposed on the Bank at this time.
Regulatory Capital
The Bank is subject to various regulatory capital requirements administered by the federal banking agencies. Failure
to meet minimum capital requirements can initiate certain mandatory – and possibly additional discretionary – actions
by regulators that, if undertaken, could have a direct material effect on the Bank’s consolidated financial statements.
Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet
specific capital guidelines that
liabilities, and certain
off-balance-sheet items as calculated under regulatory accounting practices. The net unrealized gain or loss on
available for sale securities is not included in computing regulatory capital. The Bank’s capital amounts and
classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other
factors.
involve quantitative measures of the Bank’s assets,
A banking organization must hold a capital conservation buffer comprised of Common Equity Tier 1 above its minimum
risk-based capital requirements in an amount greater than 2.5% of total risk-weighted assets. At year end 2023 and 2022,
the most recent regulatory notifications categorized the Bank as well capitalized under the regulatory framework for
prompt corrective action. There are no conditions or events since that notification that management believes have
changed the institution’s category.
The Bank’s actual capital amounts and ratios as of December 31, 2023 and 2022 are presented in the following table:
(Dollars in thousands)
Tot al risk-based capital
As of December 31, 2023
As of December 31, 2022
Tier 1 risk-based capital
As of December 31, 2023
As of December 31, 2022
Tier 1 leverage capital
As of December 31, 2023
As of December 31, 2022
Tier 1 common equity risk-based capital
As of December 31, 2023
As of December 31, 2022
Actual
For capital adequacy
purposes
For capital adequacy
purposes with capital
conservation buffer
To be well capitalized under
prompt corrective action
provision
Amount
Ratio
Amount
Ratio*
Amount
Ratio*
Amount
Ratio
$
$
$
$
$
$
$
$
86,824
82,086
79,815
74,817
79,815
74,817
79,815
74,817
15.554%
14.141%
14.298%
12.889%
10.015%
9.742%
14.298%
12.889%
$
$
$
$
$
$
$
$
44,657
46,439
33,493
34,829
31,878
30,718
25,120
26,122
8.00%
8.00%
6.00%
6.00%
4.00%
4.00%
4.50%
4.50%
$
$
$
$
$
$
$
$
58,612
60,951
47,448
49,342
31,878
30,718
39,075
40,634
10.500%
10.500%
8.500%
8.500%
4.000%
4.000%
7.000%
7.000%
$
$
$
$
$
$
$
$
55,821
58,049
44,657
46,439
39,847
38,398
36,284
37,732
10.00%
10.00%
8.00%
8.00%
5.00%
5.00%
6.50%
6.50%
41
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
Note 19. Parent Company Financial Information
A summary of the statements of financial condition as of December 31, 2023 and 2022 is as follows:
(In thousands)
Assets
Cash in subsidiary
Investment in subsidiary
Deferred tax asset
Other assets
Tot al assets
Liabilities and S hareholders’ Equity
Subordinated debt, net of issuance costs
Accrued interest payable
Other liabilities
Shareholders' equity
Tot al liabilities and shareholders’ equity
As of December 31,
2023
2022
$
$
$
$
3,981
74,401
151
296
78,829
10,631
251
24
67,923
78,829
$
$
$
$
1,148
68,927
135
257
70,467
10,559
251
19
59,638
70,467
A summary of the statements of operations for the years ended December 31, 2023 and 2022 is as follows:
(In thousands)
Equity income from subsidiary
Dividend income
Total income
Other expenses:
Interest on subordinated debt
Other operating expenses
Total other expenses
Income before income tax benefit
Income tax benefit
Net income
2023
2022
$
$
5,286
3,400
8,686
824
474
1,298
7,388
(43)
7,431
$
$
9,649
-
9,649
872
350
1,222
8,427
(71)
8,498
42
1ST COLONIAL BANCORP, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
A summary of the statements of cash flows for the years ended December 31, 2023 and 2022 is as follows:
(In thousands)
Cash flows from operating activities:
Net income
Adjustments to reconcile net income to net cash provided
by (used in) operating activities:
Equity in income from subsidiary
Stock-based compensation expense
Increase deferred income tax benefit
Amortization of issuance costs on long-term debt
Increase in other assets
Increase in other liabilities
Total adjustments
Net cash provided by (used in) operating activities
Cash flows from investing activities:
Investment in subsidiary
Net cash used in investing activities-
Cash flows from financing activities:
Acquisition of treasury stock
Proceeds from sale of stock
Net cash provided by (used in) financing activities
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
Cash paid during the year for:
Interest
Income taxes paid
2023
2022
$
7,431
$
8,498
(5,286)
369
(17)
72
(39)
5
(4,896)
2,535
-
(8)
306
298
2,833
1,148
3,981
3,726
2,782
$
$
(9,649)
265
(21)
120
(56)
3
(9,338)
(840)
-
-
(884)
104
(780)
(1,620)
2,768
1,148
3,726
2,782
$
$
Supplemental disclosures:
Net change in unrealized gains on securities available for sale, net
tax benefit of $588 for 2023 and $2,355 for 2022
$
1,341
$
(6,162)
43
Administrative Office
1000 Atrium Way
Suite 200
Mount Laurel, NJ 08054
(856) 858-1100
Collingswood Branch
1040 Haddon Avenue
Collingswood, NJ 08108
(856) 858-8604
Westville Branch
321 Broadway
Westville, NJ 08093
(856) 456-6544
Limerick Branch
440 Linfield Trappe
Road
Limerick, PA 19456
(610) 226-3000
Stock Listing
1st Colonial Bancorp, Inc.'s Common Stock is traded under the Symbol "FCOB"
Board of Directors
Linda M. Rohrer, Chairman
Thomas A. Clark, III, Esquire
Harvey Johnson, Esquire
Thomas R. Brugger
John J. Donnelly, IV
Stanley H. Molotsky
Curt Byerley
Michael C. Haydinger
Shelley Y. Simms
Executive Officers
Robert B. White, President and Chief Executive Officer
Mary Kay Shea, Executive Vice President and Chief Financial Officer
Senior Management
1st Colonial Community
Bank
Gino Brown, SVP Residential Mortgage Lending
Matthew McGonigal, SVP Director of Digital Experience and Operations
William Pizzichil, SVP Managing Director of Risk
Randolph D. Wolfe, SVP Chief Revenue Officer
Auditors
Counsel
Crowe LLP
1455 Pennsylvania Avenue NW Suite 700
Washington, DC 20004
Stradley Ronon Stevens & Young LLP
A Pennsylvania Limited Liability Partnership
2005 Market Street, Suite 2600
Philadelphia, Pennsylvania 19103-7018
Registrar and Transfer
Agent
Pacific Stock Transfer Company
6725 Via Austi Parkway
Suite 300
Las Vegas, Nevada 89119
Telephone (800) 785-7782
1000 Atrium Way
Suite 200
Mt. Laurel, NJ 08054
877.785.8550
1 S T C O L O N I A L . C O M