Parke Bancorp's Net Income Jumps 32.7% on Strong Loan Growth

TL;DR

**PKBK is crushing it with loan growth and higher net interest income, making it a solid regional bank play.**

AI Summary

PARKE BANCORP, INC. (PKBK) reported a strong financial performance for the nine months ended September 30, 2025, with net income attributable to the company increasing by 32.7% to $26.691 million, up from $20.114 million in the prior year period. This growth was primarily driven by a significant 26.8% increase in net interest income, which reached $54.642 million compared to $43.089 million in 2024. Interest and fees on loans rose to $99.142 million from $86.976 million, contributing substantially to total interest income of $105.379 million. However, the provision for credit losses also increased sharply to $1.938 million for the nine months ended September 30, 2025, from $546,000 in the same period of 2024, indicating a more cautious lending environment. Total assets grew to $2.172 billion as of September 30, 2025, from $2.142 billion at December 31, 2024, largely due to a $91.995 million net increase in loans. Deposits also saw a healthy increase, with total deposits reaching $1.752 billion, up from $1.631 billion at year-end 2024, driven by a $120.797 million increase in interest-bearing deposits. The company also reduced its FHLBNY borrowings by $75 million and subordinated debentures by $30 million, strengthening its balance sheet.

Why It Matters

This strong performance from Parke Bancorp, particularly the significant increase in net interest income and loan growth, signals robust regional economic activity and effective asset management. For investors, the 32.7% rise in net income and increased earnings per common share to $2.26 basic, suggests a healthy return on investment and potential for continued dividend growth. Employees benefit from a stable and growing institution, while customers see a bank actively lending, which can support local businesses and real estate. In a competitive banking landscape, PKBK's ability to grow its loan portfolio by $91.995 million while reducing higher-cost borrowings demonstrates a competitive edge and efficient capital deployment.

Risk Assessment

Risk Level: medium — The provision for credit losses increased significantly to $1.938 million for the nine months ended September 30, 2025, compared to $546,000 in the prior year, indicating potential concerns about loan quality or a more conservative outlook. Additionally, the company's investment securities held to maturity have gross unrealized losses of $1.395 million as of September 30, 2025, which, while not impacting net income directly, reflects interest rate sensitivity and could pose a risk if these securities needed to be sold.

Analyst Insight

Investors should consider PKBK's strong earnings growth and efficient balance sheet management as a positive signal. While monitoring the increased provision for credit losses, the overall financial health and strategic reduction in higher-cost debt suggest a well-managed regional bank. Consider adding PKBK to a diversified portfolio for exposure to regional banking strength.

Financial Highlights

debt To Equity

N/A

revenue

$105,379,000

operating Margin

N/A

total Assets

$2,172,134,000

total Debt

$83,403,000

net Income

$26,691,000

eps

$2.26

gross Margin

N/A

cash Position

$159,313,000

revenue Growth

+14.8%

Revenue Breakdown

Key Numbers

• $26.691M — Net Income (Increased 32.7% for the nine months ended September 30, 2025, compared to $20.114M in 2024.)
• $54.642M — Net Interest Income (Increased 26.8% for the nine months ended September 30, 2025, from $43.089M in 2024.)
• $1.938M — Provision for Credit Losses (Increased from $546K in 2024 for the nine months ended September 30, 2025, indicating higher risk assessment.)
• $1.960B — Loans, net of unearned income (Increased from $1.868B at December 31, 2024, showing strong loan growth.)
• $1.752B — Total Deposits (Increased from $1.631B at December 31, 2024, reflecting deposit growth.)
• $70.000M — FHLBNY borrowings (Decreased from $145.000M at December 31, 2024, reducing funding costs.)
• $13.403M — Subordinated debentures (Decreased from $43.300M at December 31, 2024, improving capital structure.)
• $0.90 — Basic Earnings Per Share (Q3 2025) (Increased from $0.63 in Q3 2024, demonstrating improved profitability per share.)
• $2.26 — Basic Earnings Per Share (YTD 2025) (Increased from $1.68 in YTD 2024, reflecting strong year-to-date performance.)
• 11,595,553 — Common Shares Outstanding (As of November 3, 2025, indicating share count for per share calculations.)

Key Players & Entities

• PARKE BANCORP, INC. (company) — registrant
• Parke Bank (company) — wholly-owned subsidiary
• Federal Deposit Insurance Corporation (regulator) — deposit insurer
• New Jersey Department of Banking and Insurance (regulator) — chartering authority
• President, Chief Executive Officer and Director (person) — chief operating decision maker
• $26.691 million (dollar_amount) — net income attributable to Company for nine months ended September 30, 2025
• $54.642 million (dollar_amount) — net interest income for nine months ended September 30, 2025
• $1.938 million (dollar_amount) — provision for credit losses for nine months ended September 30, 2025
• $2.172 billion (dollar_amount) — total assets as of September 30, 2025
• $1.752 billion (dollar_amount) — total deposits as of September 30, 2025

FAQ

Risk Factors

• Increased Provision for Credit Losses [medium — financial]: The provision for credit losses rose significantly to $1.938 million for the nine months ended September 30, 2025, from $546,000 in the same period of 2024. This indicates a more cautious outlook on loan portfolio quality and potential future defaults.
• Interest Rate Sensitivity [medium — regulatory]: As a financial institution, the company is exposed to fluctuations in interest rates. Changes in market interest rates can affect net interest income and the fair value of investment securities. The company's net interest income increased by 26.8%, but future rate movements could impact this trend.
• Cybersecurity and Data Breaches [high — operational]: Like all financial institutions, Parke Bancorp is vulnerable to cyberattacks and data breaches. A successful attack could lead to financial losses, reputational damage, and regulatory penalties.
• Economic Downturn Impact [medium — market]: A general economic slowdown or recession could negatively impact the company's loan portfolio through increased delinquencies and defaults, as well as reduce demand for banking services.

Industry Context

Parke Bancorp operates within the highly competitive banking sector, characterized by evolving customer preferences for digital services and a dynamic interest rate environment. Banks are focused on managing net interest margins, controlling operational costs, and navigating increasing regulatory scrutiny. Growth in loan and deposit segments, as seen by PKBK, is a key indicator of success in this landscape.

Regulatory Implications

As a financial institution, Parke Bancorp is subject to stringent regulations from federal and state authorities, including the FDIC and New Jersey Department of Banking and Insurance. Compliance with capital adequacy, liquidity, and consumer protection rules is paramount. The increase in the provision for credit losses may also draw attention from regulators regarding risk management practices.

What Investors Should Do

1. Monitor loan growth and credit quality trends.
2. Analyze the sustainability of net interest income growth.
3. Evaluate the impact of reduced borrowings on profitability.
4. Assess the company's risk management framework.

Key Dates

• 2025-09-30: Nine months ended September 30, 2025 — Reported strong net income growth of 32.7% and significant increase in net interest income by 26.8%.
• 2025-09-30: Balance Sheet Date — Total assets grew to $2.172 billion, with loans increasing by $91.995 million and deposits by $120.797 million.
• 2024-12-31: Year-end 2024 — Prior period comparative data for balance sheet items.

Glossary

Net Interest Income

The difference between interest income generated by a bank and the interest paid out to its depositors and lenders. (A primary driver of profitability for banks; PKBK saw a significant 26.8% increase.)

Provision for Credit Losses

An expense set aside by a company to cover potential losses from loans that may not be repaid. (An increase to $1.938 million signals a more conservative view on loan portfolio risk.)

FHLBNY borrowings

Borrowings from the Federal Home Loan Bank of New York, a source of funding for member financial institutions. (PKBK reduced these borrowings by $75 million, indicating a deleveraging of its funding structure.)

Subordinated debentures

A type of debt that ranks below other secured or senior debt in the event of liquidation. (PKBK reduced these by $30 million, strengthening its capital structure.)

Bank owned life insurance (BOLI)

Life insurance policies owned by a bank, typically used for employee benefit plans or as an investment. (BOLI assets increased to $32.947 million, contributing to the company's asset base.)

Year-Over-Year Comparison

Parke Bancorp has demonstrated robust year-over-year performance for the nine months ended September 30, 2025. Net income surged by 32.7% to $26.691 million, fueled by a significant 26.8% increase in net interest income to $54.642 million. Total assets grew modestly to $2.172 billion, with substantial increases in both loans ($1.960 billion) and deposits ($1.752 billion). A key positive development is the reduction in borrowings, with FHLBNY borrowings down by $75 million and subordinated debentures by $30 million, indicating a stronger balance sheet. However, the provision for credit losses also saw a sharp rise, signaling increased caution regarding credit risk.

Key Financial Figures

• $0.10 — ch Registered Common Stock, par value $0.10 per share PKBK The Nasdaq Stock Mar

Filing Documents

• pkbk20250930_10q.htm (10-Q) — 3181KB
• ex_856026.htm (EX-31.1) — 13KB
• ex_856027.htm (EX-31.2) — 12KB
• ex_856028.htm (EX-32) — 8KB
• 0001437749-25-033355.txt ( ) — 13253KB
• pkbk-20250930.xsd (EX-101.SCH) — 43KB
• pkbk-20250930_cal.xml (EX-101.CAL) — 53KB
• pkbk-20250930_def.xml (EX-101.DEF) — 366KB
• pkbk-20250930_lab.xml (EX-101.LAB) — 310KB
• pkbk-20250930_pre.xml (EX-101.PRE) — 394KB
• pkbk20250930_10q_htm.xml (XML) — 3921KB

Financial Statements

Financial Statements 1 Consolidated Balance Sheets as of September 30, 2025 and December 31, 2024 (unaudited) 1 Consolidated Statements of Income for the three and nine months ended September 30, 2025 and 2024 (unaudited) 2 Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2025 and 2024 (unaudited) 3 Consolidated Statements of Equity for the three and nine months ended September 30, 2025 and 2024 (unaudited) 4 Consolidated Statements of Cash Flow for the nine months ended September 30, 2025 and 2024 (unaudited) 6

Notes to Consolidated Financial Statements (unaudited)

Notes to Consolidated Financial Statements (unaudited) 7 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 23 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 34 Item 4.

Controls and Procedures

Controls and Procedures 34 Part II OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 34 Item 1A.

Risk Factors

Risk Factors 35 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 35 Item 3. Defaults Upon Senior Securities 35 Item 4. Mine Safety Disclosures 35 Item 5. Other Information 35 Item 6. Exhibits 36

SIGNATURES

SIGNATURES 37 Table of Contents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements Parke Bancorp, Inc. and Subsidiaries Consolidated Balance Sheets (unaudited) (Dollars in thousands except per share data) September 30, December 31, 2025 2024 Assets Cash and due from banks $ 6,370 $ 4,624 Interest bearing deposits with banks 152,943 216,903 Cash and cash equivalents 159,313 221,527 Investment securities available for sale, at fair value 5,066 5,551 Investment securities held to maturity, net of allowance for credit losses of $ 0 at September 30, 2025 and December 31, 2024 (fair value of $ 7,405 at September 30, 2025 and $ 7,492 at December 31, 2024) 8,793 9,209 Total investment securities 13,859 14,760 Loans, net of unearned income 1,960,153 1,868,153 Less: Allowance for credit losses ( 33,904 ) ( 32,573 ) Net loans 1,926,249 1,835,580 Accrued interest receivable 10,677 9,659 Premises and equipment, net 5,573 5,316 Restricted stock 5,366 8,619 Bank owned life insurance (BOLI) 32,947 29,070 Deferred tax asset 9,074 9,113 Other real estate owned (OREO) 1,562 1,562 Other 7,514 7,030 Total assets $ 2,172,134 $ 2,142,236 Liabilities and Shareholders' Equity Liabilities Deposits Noninterest-bearing deposits $ 184,771 $ 184,037 Interest-bearing deposits 1,567,810 1,447,013 Total deposits 1,752,581 1,631,050 FHLBNY borrowings 70,000 145,000 Subordinated debentures 13,403 43,300 Accrued interest payable 5,189 7,968 Other 16,124 14,845 Total liabilities 1,857,297 1,842,163 Shareholders' Equity Preferred stock, 1,000,000 shares authorized, $ 1,000 liquidation value Series B non-cumulative convertible; 325 shares outstanding at September 30, 2025 and December 31, 2024 325 325 Common stock, $ 0.10 par value; authorized 15,000,000 shares; Issued: 12,372,075 shares and 12,313,489 shares at September 30, 2025 and December 31, 2024, respectively 1,237 1,231 Additional paid-in capital 138,607 137,784 Retained earnings 188,684 168,3

Notes to Consolidated Financial Statements (Unaudited)

Notes to Consolidated Financial Statements (Unaudited) NOTE 1. ORGANIZATION Parke Bancorp, Inc. (the "Company, we, us, our") is a bank holding company headquartered in Sewell, New Jersey. Through subsidiaries, the Company provides individuals, corporations and other businesses and institutions with commercial and retail banking services, principally loans and deposits. The Company was incorporated in January 2005 under the laws of the State of New Jersey for the sole purpose of becoming the holding company of Parke Bank (the "Bank"). The Bank is a commercial bank, which was incorporated on August 25, 1998, and commenced operations on January 28, 1999. The Bank is chartered by the New Jersey Department of Banking and Insurance and its deposits are insured by the Federal Deposit Insurance Corporation. The Bank maintains its principal office at 601 Delsea Drive, Sewell, New Jersey, and has six additional branch office locations; 501 Tilton Road, Northfield, New Jersey, 567 Egg Harbor Road, Washington Township, New Jersey, 67 East Jimmie Leeds Road, Galloway Township, New Jersey, 1150 Haddon Avenue, Collingswood, New Jersey, 1610 Spruce Street, Philadelphia, Pennsylvania, and 1032 Arch Street, Philadelphia, Pennsylvania. The Bank also has a loan office located at 1817 East Venango Street, Philadelphia, Pennsylvania. NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Financial Statement Presentation: We prepared our consolidated financial statements in accordance with accounting principles generally accepted in the United States of America ("GAAP"). The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, Parke Bank (including certain partnership interests). Parke Capital Trust I, Parke Capital Trust II and Parke Capital Trust III are wholly-owned subsidiaries but are not consolidated as they do not meet the requirements for consolidation under applicable accounting guidance. We have eliminat

Description of Securities

Description of Securities Value Losses Value Losses Value Losses (Dollars in thousand) Available for sale: Residential mortgage-backed securities $ 5 $ — $ 4,136 $ 314 $ 4,141 $ 314 Total available for sale $ 5 $ — $ 4,136 $ 314 $ 4,141 $ 314 As of December 31, 2024 Less Than 12 Months 12 Months or Greater Total Fair Unrealized Fair Unrealized Fair Unrealized

Description of Securities

Description of Securities Value Losses Value Losses Value Losses (Dollars in thousands) Available for sale: Residential mortgage-backed securities $ 80 $ 1 $ 4,973 $ 455 $ 5,053 $ 456 Total available for sale $ 80 $ 1 $ 4,973 $ 455 $ 5,053 $ 456 10 Table of Contents On at least a quarterly basis, we review all debt securities that are in an unrealized loss position for a credit loss. An investment security is deemed impaired if the fair value of the investment is less than its amortized cost. Amortized cost includes adjustments (if any) made to the cost basis of an investment for accretion, amortization, and previous other-than-temporary impairments. For individual debt securities classified as available for sale, we determine whether a decline in fair value below the amortized cost has resulted from a credit loss or other factors. If the decline in fair value is due to credit, we will record the portion of the impairment loss relating to credit through an allowance for credit losses. Impairment that has not been recorded through an allowance for credit losses is recorded through other comprehensive income, net of applicable taxes. The Company's unrealized loss for the debt securities classified as available for sale is comprised of 2 securities in the less than 12 months loss position and 14 securities in the 12 months or greater loss position at September 30, 2025 . These securities are mortgage-backed securities that had unrealized losses issued or guaranteed by the US government or US government sponsored entities. The unrealized losses associated with those mortgage-backed securities are generally driven by changes in interest rates and are not due to credit losses given the explicit or implicit guarantees provided by the U.S. government. The Company classifies the held-to-maturity debt securities into the following major security types: residential mortgage backed, and state and political subdivisions. These securities are highly rated wi

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