3rd Quarter 2023 Shareholder Newsletter
Letter from the CEO
Dear Shareholders,I trust this letter finds you well, and I appreciate the opportunity to update you on our performance in the third quarter of 2023, which was marked by notable achievements and a couple of challenges.Before diving into the specifics of this quarter, I want to express my gratitude for your continued support and confidence in Parkside Financial Bank & Trust. We are committed to navigating challenges and making the most of the opportunities to ensure our continued growth and success. Please feel free to reach out to our team with any questions or comments.Sincerely,
James C. Wagner
Chief Executive Officer | Parkside Financial Bank & Trust
Table of Contents |
Commercial Bank
Our commercial bank continues to exhibit consistently strong growth, with both loans and client deposits growing in a very competitive environment.
Loan Growth
In the third quarter, our loans grew a record $57 million, ending the quarter at $745 million. This contributed to impressive year-to-date loan growth of $114 million and $160 million, or 27%, when compared to the same period in 2022. The increase in loans led to year-to-date net interest income of $22.3 million, up $3.8 million when compared to the same period last year.
Our growth is well-diversified, thanks to our teams in Denver, St. Louis, and from our New Hampshire Search Fund team. As we look ahead, we are confident we will meet our year-end loan target, showing that our strategic, growth-oriented investments are yielding the expected results.
Client Deposits
Client deposits totaled $647 million as of September 30th, marking a decrease of $89 million, or 12%, from year-end. We typically experience around 15% in seasonal deposit runoff in the first half of the year and then bounce back in the second half of the year. With a recent upturn in client deposits, we expect deposits to stabilize going forward.
Loan Loss
In July, we experienced our first loan loss in several years, taking a $1.8million charge-off. While we have experienced exceptionally low loan losses (just 0.09% of average loans over the life of the portfolio) we are in the business of lending money, as such, there will be loan losses.
Because of our increased revenue, we completely replenished our reserves during the third quarter, and we remain on track to achieve a budgeted $6 million net income for 2023.
Because of our increased revenue, we completely replenished our reserves during the third quarter, and we remain on track to achieve a budgeted $6 million net income for 2023.
Trust & Family Office
Our Trust & Family Office division has experienced noteworthy growth, with assets under management exceeding $1.9 billion, making significant progress toward the coveted $2 billion milestone. Furthermore, the division's monthly recurring revenue (“run rate”), is up $55 thousand per month, compared to the previous quarter, reaching a run rate of nearly $750 thousand per month.
TFO Revenue Growth
This growth is not an isolated event, but part of a consistent upward trajectory in the Trust & Family Office division's financial performance.
Over the last three years, the division has demonstrated consistent revenue growth, with its year-to-date September 2023 revenue amounting to $6.3 million, marking a substantial year-over-year increase of $569 thousand, or 10%, compared to the same period in 2022. This growth follows a positive trend that started in September 2022, with year-to-date revenue of $5.7 million, reflecting a $279 thousand increase, or 5% compared to the first nine months of 2021.
Over the last three years, the division has demonstrated consistent revenue growth, with its year-to-date September 2023 revenue amounting to $6.3 million, marking a substantial year-over-year increase of $569 thousand, or 10%, compared to the same period in 2022. This growth follows a positive trend that started in September 2022, with year-to-date revenue of $5.7 million, reflecting a $279 thousand increase, or 5% compared to the first nine months of 2021.
Denver Office
We are thrilled to announce that Tait Johnson, who has over 16 years of wealth management expertise and most recently served as Vice President and Head of Office at Goldman Sachs in Vail, has joined Parkside as a Trust & Family Office Advisor in our Denver office. He will focus on providing tailored financial solutions for high-net-worth individuals and families. He joined us in mid-September and has already closed over $225 thousand in annualized new business as of mid-October.
Looking Ahead
With the Trust & Family Office and Banking divisions showing great momentum, we are excited about our continued growth and new opportunities ahead. Our commitment to maintaining a sound financial position remains unwavering, ensuring we are well-prepared for any future developments.
We appreciate your trust in Parkside Financial Bank & Trust and the dedication of our team. We look forward to an even brighter future as we enter the last quarter of 2023.
Our Growing Team
We continue to expand our team!
Parkside most recently welcomed these exceptional employees in Q3 2023:
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Shelby Cross
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CRM Manager/Data Analyst |
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Jamie Hilliard
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Trust & Family Office Operations Specialist |
| Senior Vice President | Trust & Family Office Advisor | |
| Executive Vice President | Chief Banking Officer |
Financial Information
Investments are not insured by the FDIC or any federal government agency, provide no bank guarantee, are not a deposit and may lose value. *The Company is aware of the following recent transactions in the Company’s stock. No assurances can be given that such information reflects all transactions in the Company’s stock during the period or that such transactions accurately and completely reflect the value of the Company’s stock. Such information is provided for convenience and should not be relied upon. The Company does not make a market in or otherwise trade in its stock. However, the Company can assist in the settlement of transactions in its stock between buyers and sellers who have independently negotiated the terms of their transactions.