FRBA First Bank

First Bank (Nasdaq Global Market: FRBA) today announced that the Kroll Bond Rating Agency (KBRA), a Nationally Recognized Statistical Rating Organization (NRSRO) registered with the U.S. Securities and Exchange Commission (SEC), has affirmed the Bank’s credit ratings and stable outlook.

The Bank’s favorable ratings and a stable outlook were maintained with a Deposit rating of BBB+, Senior Unsecured Debt rating of BBB+, Subordinated Debt rating of BBB, Short-Term Deposit rating of K2 and a Short-Term Debt rating of K2. KBRA’s report and additional details on their rating scale can be found at their website at www.krollbondratings.com. According to KBRA’s report, “First Bank’s ratings are supported by its seasoned management team that has been successfully executing the Bank’s strategic objectives in recent years, including the utilization of M&A and organic growth to build scale within footprint, as well as enhancing the core deposit franchise, both of which have tremendously improved FRBA’s earnings capacity. Through balance sheet growth and positive operating leverage, as well as cost-savings from acquisitions and branch rationalization, the Bank has been able to meaningfully reduce operating expenses relative to average assets in recent years.

“Moreover, the hiring of a Chief Deposit Officer, and focus on growing core deposits, notably commercial accounts, has facilitated FRBA’s improved deposit composition over the years, with time deposits decreasing from a peak of 47% of total deposits at YE17 to just 23% as of 2Q21. Meanwhile, noninterest-bearing accounts have grown from 17% to 26% during this same period. As such, the Bank’s cost of deposits has declined considerably (30 bps for 2Q21) and currently track closer in line with local peers, which has allowed for substantial NIM expansion in recent periods. Lastly, through the expansion of a few business lines, loan swaps and SBA lending, FRBA has also bolstered its fee income levels as well. Altogether, given these improvements across the board, First Bank currently reflects strong profitability, with ROA of 1.55% through 1H21, though more impressively a PPNR ROA of 1.95% for the same period vs. 1.43% pre-pandemic (2019).”

First Bank’s President and Chief Executive Officer, Patrick L. Ryan stated, “KBRA’s credit ratings review of First Bank has once again confirmed the strength of our balance sheet, disciplined approach to underwriting and effective business model and growth strategy. Their analysis cites our consistent strong credit quality metrics, with a low level of non-performing assets and nominal charge-offs, solid organic loan and deposit growth as well as a history of effective integration of acquisitions which has resulted in meaningful cost-savings. We believe that KBRA’s expectation that our bottom-line results will remain favorable in the near-term provides additional validation of our approach to building franchise value for our shareholders.”

About Kroll Bond Rating Agency

KBRA was established in 2010 in an effort to restore trust in credit ratings by creating new standards for assessing risk and by offering accurate and transparent ratings. KBRA is registered with the SEC as a NRSRO and is recognized by the National Association of Insurance Commission as a Credit Rating Provider. KBRA is a full-service rating agency whose mission is to set a standard of excellence and integrity.

About First Bank

First Bank is a New Jersey state-chartered bank with 16 full-service branches in Cinnaminson, Cranbury, Delanco, Denville, Ewing, Flemington, Hamilton, Lawrence, Pennington, Randolph, Somerset and Williamstown, New Jersey; and Doylestown, Trevose, Warminster and West Chester, Pennsylvania. With $2.4 billion in assets as of June 30, 2021, First Bank offers a full range of deposit and loan products to individuals and businesses throughout the New York City to Philadelphia corridor. First Bank's common stock is listed on the Nasdaq Global Market under the symbol “FRBA”. 

Forward Looking Statements

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

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