PSB Holdings, Inc. Reports First Quarter 2024 Earnings of $0.39 Per Share, Tangible Net Book Value Per Share Up 8% In Past Year

PSB Holdings, Inc.

Mon, Apr 22, 2024, 6:30 AM 20 min read

WAUSAU, Wis., April 22, 2024 (GLOBE NEWSWIRE) -- PSB Holdings, Inc. (“PSB”) (OTCQX: PSBQ), the holding company for Peoples State Bank (“Peoples”) serving Northcentral and Southeastern Wisconsin reported first quarter earnings ending March 31, 2024 of $0.39 per common share on net income of $1.6 million, compared to $0.55 per common share on net income of $2.3 million during the fourth quarter ending December 31, 2023, and $0.67 per common share on net income of $2.9 million during the first quarter ending March 31, 2023.

PSB’s first quarter 2024 operating results reflected the following changes from the fourth quarter of 2023: (1) lower net interest income as deposit and FHLB borrowing costs rose faster than interest income on loans; (2) lower non-interest income due primarily to the sale of investment securities at a loss with the proceeds reinvested into higher yielding investments; (3) higher non-interest expense related to annual salary increases in the first quarter and a reduction in vesting of incentives and benefits recorded in the prior quarter; (4) stronger capital ratios supported by additional earnings and slightly lower total assets; and (6) an increase in non-performing assets related to one borrower in the timber industry impacted by weather conditions and economic stress in that industry.

“We continue to focus on building shareholder value in a challenging environment, with common tangible book value increasing to $24.21 per share and stronger than expected loan growth prospects looking forward. However, rising funding costs remain a challenge. While new loan origination coupons have risen in the first quarter, the cost of new FHLB borrowings and continued rate increases in our existing deposits rose faster than asset yields as a whole,” stated Scott Cattanach, President and CEO.

March 31, 2024, Highlights:

Net interest income declined to $9.3 million for the quarter ended March 31, 2024, from $9.6 million for the quarter ended December 31, 2023, as increases in asset and loan yields were offset by increases in funding costs.
Tangible book value per common share increased to $24.21 at March 31, 2024, compared to $23.84 one quarter earlier and $22.43 at March 31, 2023. During the first quarter ended March 31, 2024, tangible book value per share was positively influenced by net income, intangible asset amortization, and stock repurchase activity.
Loans increased $2.9 million in the first quarter ended March 31, 2024, to $1.08 billion. Allowance for credit losses increased to 1.14% of gross loans.
Return on tangible common equity was 6.57% for the quarter ended March 31, 2024, compared to 9.64% the prior quarter and 12.63% one year earlier.
Noninterest income was $1.0 million for the quarter ended March 31, 2024, compared to $1.1 million the prior quarter. The current quarter reflected a slightly larger loss on the sale of investment securities as the Company continues to reposition the investment portfolio into higher yielding investments.
Noninterest expenses increased $967,000 in the first quarter of 2024, to $8.3 million from $7.4 million the prior quarter. The increase reflected scheduled salary increases and costs associated with vesting of other benefits. December 2023 quarterly salary costs were lowered by adjustments to post retirement and incentive accruals. March 2024 quarterly salaries and employee benefits expense was 2.3% greater than March 2023 quarterly salaries and employee benefits.

Balance Sheet and Asset Quality Review

Total assets decreased $5.5 million to $1.42 billion at March 31, 2024. Cash and cash equivalents decreased $11.9 million, to $15.9 million at March 31, 2024, compared to $27.8 million the previous quarter. The lower cash and cash equivalent level primarily reflects proceeds used to fund higher yielding loans and investments. Investment securities available for sale increased $1.5 million to $165.6 million at March 31, 2024, from $164.0 million one quarter earlier. During the first quarter, $6.3 million available for sale securities were sold with the proceeds reinvested into higher yielding investments. Total collateralized liquidity available to meet cash demands was approximately $396 million at March 31, 2024, with an additional $317 million that could be raised in a short time frame from the brokered CDs market.

Total loans receivable increased $2.9 million to $1.08 billion at March 31, 2024 due primarily to draw downs of prior quarter loans in process, although gross loans outstanding declined $7.4 million. Commercial real estate loans decreased $8.2 million to $609.6 million at March 31, 2024, from $617.9 million the prior quarter. Commercial non-real estate loans decreased $1.3 million to $159.7 million at March 31, 2024, from $161.0 million one quarter earlier. Residential real estate loans increased $1.6 million from the prior quarter to $339.8 million from $338.2 million. The loan portfolio remains well diversified with commercial real estate loans totaling 54.7% of gross loans followed by residential real estate loans at 30.5% of gross loans, commercial non-real estate loans at 14.3% and consumer loans at 0.4%.

The allowance for credit losses increased slightly to 1.14% of gross loans at March 31, 2024, from 1.13% the prior quarter. Annualized net charge-offs to average loans were zero for the last three quarters ending March 31, 2024, compared to net recoveries of 0.02% one year earlier. Non-performing assets increased to 0.83% of total assets at March 31, 2024, due primarily to the addition of a $5.1 million loan to a borrower in the timber industry. Specific reserves have been established on the loan relationship for potential losses. For the fifth consecutive quarter, the Bank did not own any foreclosed real estate.

Total deposits decreased $28.5 million to $1.11 billion at March 31, 2024, from $1.14 billion at December 31, 2023. The decline in deposits reflects a pay down of $9.5 million in maturing brokered deposits and national CDs and a $22.2 million decline in uninsured deposits. Insured core and time deposits increased $3.2 million during the first quarter.

The composition of deposits continued to change during the first quarter of 2024 as customers seek higher deposit rates. At March 31, 2024, money market deposits and retail time deposits increased to 41.6% of deposits, compared to 40.6% at December 31, 2023. Uninsured and uncollateralized deposits declined to 19.3% of total deposits at March 31, 2024, from 20.9% of total deposits at December 31, 2023.
FHLB advances increased to $158.3 million at March 31, 2024, compared to $134.0 million at December 31, 2023. FHLB advances were used to fund repayment of certain brokered deposit maturities and supplement local deposit changes.

Tangible stockholder equity as a percent of total tangible assets was 7.60% at March 31, 2024, compared to 7.49% at December 31, 2023, and 7.54% at March 31, 2023.

Tangible net book value per common share increased $1.78, to $24.21, at March 31, 2024, compared to $22.43 one year earlier, an increase of 7.9%. Relative to the prior quarter, tangible net book value per common share increased $0.37 due to continued earnings. New security purchases with higher yields helped offset an increase in national market interest rates that lowered the value of the securities portfolio during the first quarter. The accumulated other comprehensive loss on the investment portfolio was $20.8 million at March 31, 2024, compared to $20.7 million one quarter earlier.

Operations Review

Net interest income declined to $9.3 million (on a net margin of 2.80%) for the first quarter of 2024 from $9.6 million (on a net margin of 2.88%) for the fourth quarter of 2023, and $9.9 million (on a net margin of 3.21%) for the first quarter of 2023. Earning asset yields increased 13 basis points to 5.12% during the first quarter of 2024 from 4.99% during the fourth quarter of 2023, while interest bearing deposit and borrowing costs increased 21 basis points to 3.00% compared to 2.79% during the fourth quarter of 2023.

The increase in earning asset yields was primarily due to higher yields on loan originations and renewals during the quarter. Partially offsetting the increased yield on earning assets during the quarter was the loss of interest income of approximately $114,000 on a newly classified non-performing loan. Taxable security yields were 2.80% for the quarter ended March 31, 2024, compared to 2.72% for the quarter ended December 31, 2023, up 8 basis points. Loan yields increased during the first quarter to 5.59% from 5.43% for the fourth quarter of 2023, up 16 basis points as loans repriced to higher market rates and increased credit spreads.

Rising deposit costs for savings and demand deposits, money market deposits, time deposits and FHLB advances were responsible for the rise in the Bank’s cost of funds. Additionally, the Company accepted an increase in $26.0 million of additional seasonal high yield municipal average deposits during the first quarter, which accelerated the overall rising cost of deposits during the quarter. The municipal deposits are expected to be drawn down during the second quarter. The overall cost of all deposits was 2.14% for the quarter ended March 31, 2024, compared to 1.91% the prior quarter, up 23 basis points. FHLB advance costs rose to 4.08% during the first quarter ended March 31, 2024, from 4.01% the prior quarter, and greater use of FHLB advance funding lowered net interest margin.

Total noninterest income decreased slightly for the first quarter of 2024 to $1.04 million, from $1.10 million for the fourth quarter of 2023, due primarily to investment restructuring activity with a loss on the sale of investment securities during the first quarter of $495,000 compared to a loss of $297,000 in the fourth quarter of 2023. Mortgage banking income increased by $61,000, or 24.6%, to $308,000 in the March 2024 quarter. At March 31, 2024, the Bank serviced $366.6 million in secondary market residential mortgage loans for others which provides fee income.

Noninterest expenses increased to $8.3 million for the first quarter of 2024, compared to $7.4 million for the fourth quarter of 2023. The fourth quarter of 2023 included lower salary and benefit expenses due to a recovery of post-retirement benefits and incentive accruals. The first quarter ended March 31, 2024, also reflected higher salary and benefit expenses due to annual salary increases and costs associated with various benefits.

Taxes decreased $709,000 during the first quarter to $169,000 from $878,000 one quarter earlier. The decrease reflects lower pre-tax income, the relative value of tax exempt income assets, and the benefit related to a Wisconsin state tax change that exempts certain loan interest income effectively eliminating Wisconsin tax expense.

About PSB Holdings, Inc.

PSB Holdings, Inc. is the parent company of Peoples State Bank. Peoples is a community bank headquartered in Wausau, Wisconsin, serving northcentral and southeastern Wisconsin from eleven full-service banking locations in Marathon, Oneida, Vilas, Portage, Milwaukee and Waukesha counties and a loan production office in Dane County. Peoples also provides investment and insurance products, along with retirement planning services, through Peoples Wealth Management, a division of Peoples. PSB Holdings, Inc. is traded under the stock symbol PSBQ on the OTCQX Market. More information about PSB, its management, and its financial performance may be found at www.psbholdingsinc.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on current expectations, estimates and projections about PSB’s business based, in part, on assumptions made by management and include, without limitation, statements with respect to the potential growth of PSB, its future profits, expected stock repurchase levels, future dividend rates, future interest rates, and the adequacy of its capital position. Forward-looking statements can be affected by known and unknown risks, uncertainties, and other factors, including, but not limited to, strength of the economy, the effects of government policies, including interest rate policies, risks associated with the execution of PSB’s vision and growth strategy, including with respect to current and future M&A activity, and risks associated with global economic instability. The forward-looking statements in this press release speak only as of the date on which they are made and PSB does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this release.

PSB Holdings, Inc.
Consolidated Balance Sheets
March 31, 2024, September 30, June 30, and March 31, 2023, unaudited, December 31, 2023 derived from audited financial statements

	Mar. 31,			Dec. 31,			Sep. 30,			Jun. 30,			Mar. 31,
(dollars in thousands, except per share data)		2024			2023			2023			2023			2023

Assets

Cash and due from banks	$	13,340		$	20,887		$	12,881		$	27,409		$	13,336
Interest-bearing deposits		105			1,431			668			892			538
Federal funds sold		2,439			5,462			7,764			16,138			25,766

Cash and cash equivalents		15,884			27,780			21,313			44,439			39,640
Securities available for sale (at fair value)		165,566			164,024			160,883			167,382			190,738
Securities held to maturity (fair values of $81,234, $82,514, $75,236, $81,489 and
$82,610, respectively		87,104			87,081			86,908			87,335			87,889
Equity securities		1,474			1,474			2,273			2,178			2,070
Loans held for sale		865			230			971			151			-
Loans receivable, net (allowance for credit losses of $12,494, $12,302, $12,267,
$11,922 and $11,593, respectively		1,081,394			1,078,475			1,098,019			1,048,322			973,270
Accrued interest receivable		5,467			5,136			4,716			4,274			4,062
Foreclosed assets		-			-			-			-			-
Premises and equipment, net		13,427			13,098			13,242			13,256			13,406
Mortgage servicing rights, net		1,657			1,664			1,684			1,666			1,682
Federal Home Loan Bank stock (at cost)		7,006			6,373			6,373			6,359			4,620
Cash surrender value of bank-owned life insurance		24,242			24,085			23,931			23,776			25,078
Core deposit intangible		249			273			297			321			348
Goodwill		2,541			2,541			2,541			2,541			2,541
Other assets		11,682			11,866			14,094			14,933			14,444

TOTAL ASSETS	$	1,418,558		$	1,424,100		$	1,437,245		$	1,416,933		$	1,359,788

Liabilities

Non-interest-bearing deposits	$	247,608		$	266,829		$	288,765		$	282,153		$	267,836
Interest-bearing deposits		865,744			874,973			883,474			860,981			839,757

Total deposits		1,113,352			1,141,802			1,172,239			1,143,134			1,107,593

Federal Home Loan Bank advances		158,250			134,000			128,000			133,000			113,000
Other borrowings		8,096			8,058			5,660			5,730			5,033
Senior subordinated notes		4,776			4,774			4,772			4,771			4,769
Junior subordinated debentures		12,947			12,921			12,896			12,870			12,844
Allowance for credit losses on unfunded commitments		477			577			512			712			762
Accrued expenses and other liabilities		10,247			12,681			10,258			11,783			10,576

Total liabilities		1,308,145			1,314,813			1,334,337			1,312,000			1,254,577

Stockholders' equity

Preferred stock - no par value:
Authorized - 30,000 shares; no shares issued or outstanding
Outstanding - 7,200 shares, respectively		7,200			7,200			7,200			7,200			7,200
Common stock - no par value with a stated value of $1.00 per share:
Authorized - 18,000,000 shares; Issued - 5,490,798 shares
Outstanding - 4,147,649, 4,164,735, 4,174,197, 4,190,252 and
4,241,501 shares, respectively		1,830			1,830			1,830			1,830			1,830
Additional paid-in capital		8,466			8,460			8,421			8,382			8,311
Retained earnings		134,271			132,666			131,624			130,396			128,968
Accumulated other comprehensive income (loss), net of tax		(20,775	)		(20,689	)		(26,190	)		(23,240	)		(22,515	)
Treasury stock, at cost - 1,343,149, 1,326,063, 1,316,601, 1,300,546 and
1,249,297 shares, respectively		(20,579	)		(20,180	)		(19,977	)		(19,635	)		(18,583	)

Total stockholders' equity		110,413			109,287			102,908			104,933			105,211

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	1,418,558		$	1,424,100		$	1,437,245		$	1,416,933		$	1,359,788

PSB Holdings, Inc.
Consolidated Statements of Income
	Quarter Ended
(dollars in thousands,	Mar. 31,			Dec. 31,			Sep. 30,		Jun. 30,			Mar. 31,
except per share data - unaudited)		2024			2023			2023		2023			2023

Interest and dividend income:
Loans, including fees	$	15,109		$	14,888		$	14,263	$	12,709		$	11,773
Securities:
Taxable		1,197			1,147			1,114		1,327			1,331
Tax-exempt		526			532			533		535			537
Other interest and dividends		343			320			238		145			148

Total interest and dividend income		17,175			16,887			16,148		14,716			13,789

Interest expense:
Deposits		6,082			5,526			4,817		3,661			2,989
FHLB advances		1,450			1,349			1,321		1,200			547
Other borrowings		60			54			51		48			62
Senior subordinated notes		59			59			59		58			62
Junior subordinated debentures		251			254			255		242			234

Total interest expense		7,902			7,242			6,503		5,209			3,894

Net interest income		9,273			9,645			9,645		9,507			9,895
Provision for credit losses		95			100			150		100			100

Net interest income after provision for credit losses		9,178			9,545			9,495		9,407			9,795

Noninterest income:
Service fees		336			360			349		378			361
Mortgage banking income		308			247			345		311			325
Investment and insurance sales commissions		121			100			158		287			365
Net loss on sale of securities		(495	)		(297	)		-		(279	)		-
Increase in cash surrender value of life insurance		157			154			155		149			157
Life insurance death benefit		-			-			-		533			-
Other noninterest income		617			540			675		605			742

Total noninterest income		1,044			1,104			1,682		1,984			1,950

Noninterest expense:
Salaries and employee benefits		5,123			4,244			4,514		4,884			5,006
Occupancy and facilities		721			675			689		698			699
Loss (gain) on foreclosed assets		-			1			-		4			(50	)
Data processing and other office operations		1,022			1,001			953		951			880
Advertising and promotion		129			244			161		166			162
Core deposit intangible amortization		24			24			24		27			34
Other noninterest expenses		1,306			1,169			1,113		1,202			1,073

Total noninterest expense		8,325			7,358			7,454		7,932			7,804

Income before provision for income taxes		1,897			3,291			3,723		3,459			3,941
Provision for income taxes		169			878			2,374		652			941

Net income	$	1,728		$	2,413		$	1,349	$	2,807		$	3,000
Preferred stock dividends declared	$	122		$	122		$	122	$	122		$	122

Net income available to common shareholders	$	1,606		$	2,291		$	1,227	$	2,685		$	2,878
Basic earnings per common share	$	0.39		$	0.55		$	0.29	$	0.64		$	0.67
Diluted earnings per common share	$	0.39		$	0.55		$	0.29	$	0.64		$	0.67

PSB Holdings, Inc.
Quarterly Financial Summary
(dollars in thousands, except per share data)		Quarter ended
		Mar. 31,			Dec. 31,			Sep. 30,			Jun. 30,			Mar. 31,
Earnings and dividends:			2024			2023			2023			2023			2023

	Interest income	$	17,175		$	16,887		$	16,148		$	14,716		$	13,789
	Interest expense	$	7,902		$	7,242		$	6,503		$	5,209		$	3,894
	Net interest income	$	9,273		$	9,645		$	9,645		$	9,507		$	9,895
	Provision for credit losses	$	95		$	100		$	150		$	100		$	100
	Other noninterest income	$	1,044		$	1,104		$	1,682		$	1,984		$	1,950
	Other noninterest expense	$	8,325		$	7,358		$	7,454		$	7,932		$	7,804
	Net income available to common shareholders	$	1,606		$	2,291		$	1,227		$	2,685		$	2,878

	Basic earnings per common share (3)	$	0.39		$	0.55		$	0.29		$	0.64		$	0.67
	Diluted earnings per common share (3)	$	0.39		$	0.55		$	0.29		$	0.64		$	0.67
	Dividends declared per common share (3)	$	-		$	0.30		$	-		$	0.30		$	-
	Tangible net book value per common share (4)	$	24.21		$	23.84		$	22.25		$	22.64		$	22.43

	Semi-annual dividend payout ratio	n/a				38.14	%	n/a				27.38	%	n/a
	Average common shares outstanding		4,154,702			4,168,924			4,186,940			4,218,226			4,275,160


Balance sheet - average balances:
	Loans receivable, net of allowances for credit loss	$	1,081,936		$	1,081,851		$	1,076,158		$	1,000,349		$	964,029
	Assets	$	1,429,437		$	1,424,240		$	1,425,522		$	1,367,363		$	1,336,511
	Deposits	$	1,138,010		$	1,148,399		$	1,149,624		$	1,098,039		$	1,124,091
	Stockholders' equity	$	109,473		$	105,060		$	105,745		$	106,762		$	103,406


Performance ratios:
	Return on average assets (1)		0.49	%		0.67	%		0.38	%		0.82	%		0.91	%
	Return on average common stockholders' equity (1)		6.32	%		9.29	%		4.94	%		10.82	%		12.13	%
	Return on average tangible common
	stockholders' equity (1)(4)		6.57	%		9.64	%		5.17	%		11.23	%		12.63	%
	Net loan charge-offs to average loans (1)		0.00	%		0.00	%		0.00	%		-0.07	%		-0.02	%
	Nonperforming loans to gross loans		1.08	%		0.54	%		0.55	%		0.60	%		0.62	%
	Nonperforming assets to total assets		0.83	%		0.42	%		0.42	%		0.45	%		0.45	%
	Allowance for credit losses to gross loans		1.14	%		1.13	%		1.10	%		1.12	%		1.18	%
	Nonperforming assets to tangible equity
	plus the allowance for credit losses (4)		10.59	%		5.38	%		5.87	%		5.96	%		5.76	%
	Net interest rate margin (1)(2)		2.80	%		2.88	%		2.88	%		2.98	%		3.21	%
	Net interest rate spread (1)(2)		2.12	%		2.20	%		2.27	%		2.46	%		2.77	%
	Service fee revenue as a percent of
	average demand deposits (1)		0.54	%		0.52	%		0.50	%		0.58	%		0.52	%
	Noninterest income as a percent
	of gross revenue		5.73	%		6.14	%		9.43	%		11.88	%		12.39	%
	Efficiency ratio (2)		78.93	%		67.04	%		64.58	%		68.09	%		65.02	%
	Noninterest expenses to average assets (1)		2.34	%		2.05	%		2.07	%		2.33	%		2.37	%
	Average stockholders' equity less accumulated
	other comprehensive income (loss) to
	average assets		8.98	%		8.88	%		9.00	%		9.33	%		9.32	%
	Tangible equity to tangible assets (4)		7.60	%		7.49	%		6.98	%		7.22	%		7.54	%

Stock price information:

	High	$	22.50		$	22.30		$	22.50		$	21.38		$	25.75
	Low	$	20.05		$	20.10		$	20.35		$	19.75		$	20.00
	Last trade value at quarter-end	$	21.25		$	22.11		$	21.15		$	20.35		$	21.15

(1) Annualized
(2) The yield on federally tax-exempt loans and securities is computed on a tax-equivalent basis using a federal tax rate of 21%.
(3) Due to rounding, cumulative quarterly per share performance may not equal annual per share totals.
(4) Tangible stockholders' equity excludes goodwill and core deposit intangibles.

PSB Holdings, Inc.
Consolidated Statements of Comprehensive Income

				Quarter Ended
				Mar. 31,			Dec. 31,			Sep. 30,			Jun. 30,			Mar. 31,
(dollars in thousands - unaudited)					2024			2023			2023			2023			2023

Net income				$	1,728		$	2,413		$	1,349		$	2,807		$	3,000

Other comprehensive income, net of tax:

	Unrealized gain (loss) on securities available
		for sale			(615	)		5,278			(3,085	)		(1,186	)		1,601

	Reclassification adjustment for security
		loss included in net income			391			280			-			220			-

	Accretion of unrealized loss included in net
		income on securties available for sale
		deferred tax adjustment for Wisconsin
		Act 19			(35	)		-			-			-			-

	Amortization of unrealized loss included in net
		income on securities available for sale
		transferred to securities held to maturity			91			91			91			107			129
			&nb...sp;
	Unrealized gain (loss) on interest rate swap				123			(109	)		79			172			(1	)

	Reclassification adjustment of interest rate
		swap settlements included in earnings			(41	)		(39	)		(35	)		(38	)		(24	)


Other comprehensive income (loss)					(86	)		5,501			(2,950	)		(725	)		1,705

Comprehensive income (loss)				$	1,642		$	7,914		$	(1,601	)	$	2,082		$	4,705

PSB Holdings, Inc.
Nonperforming Assets as of:
	Mar 31,			Dec 31,			Sep 30,			Jun 30,			Mar 31,
(dollars in thousands)		2024			2023			2023			2023			2023

Nonaccrual loans (excluding restructured loans)	$	11,498		$	5,596		$	5,807		$	6,000		$	5,773
Nonaccrual restructured loans		30			34			42			50			57
Restructured loans not on nonaccrual		304			310			256			261			265
Accruing loans past due 90 days or more		-			-			-			-			-

Total nonperforming loans		11,832			5,940			6,105			6,311			6,095
Other real estate owned		-			-			-			-			-

Total nonperforming assets	$	11,832		$	5,940		$	6,105		$	6,311		$	6,095

Nonperforming loans as a % of gross loans receivable		1.08	%		0.54	%		0.55	%		0.60	%		0.62	%
Total nonperforming assets as a % of total assets		0.83	%		0.42	%		0.42	%		0.45	%		0.45	%
Allowance for credit losses as a % of nonperforming loans		105.59	%		207.10	%		200.93	%		188.91	%		190.21	%

PSB Holdings, Inc.
Nonperforming Assets >= $500,000 net book value before specific reserves
At March 31, 2024
(dollars in thousands)
		Gross
Collateral Description	Asset Type	Principal

Real estate - Buffet Style Restaurant	Nonaccrual	$	2,611
Real estate - Independent Auto Repair	Nonaccrual		611
Real estate - Dealership	Nonaccrual		5,053


Total listed nonperforming assets		$	8,275
Total bank wide nonperforming assets		$	11,832
Listed assets as a % of total nonperforming assets			70	%

PSB Holding, Inc.
Loan Composition by Collateral Type
Quarter-ended (dollars in thousands)	Mar 31, 2024			Dec 31, 2023			Sep 30, 2023			Jun 30, 2023			Mar 31, 2023

Commercial:
Commercial and instrustrial	$	118,821		$	117,207		$	138,299		$	145,434		$	133,427
Agriculture		12,081			12,304			12,464			13,326			12,434
Municipal		28,842			31,530			27,186			25,222			6,430

Total Commercial		159,744			161,041			177,949			183,982			152,291

Commercial Real Estate:
Commercial real estate		546,257			536,209			539,488			490,657			469,395
Construction and development		63,375			81,701			86,456			99,769			103,108

Total Commercial Real Estate		609,632			617,910			625,944			590,426			572,503

Residential real estate:
Residential		274,300			274,453			274,632			274,692			261,415
Construction and development		34,158			33,960			33,141			41,485			26,480
HELOC		31,357			29,766			29,044			26,220			25,001

Total Residential Real Estate		339,815			338,179			336,817			342,397			312,896

Consumer installment		4,867			4,357			4,350			4,142			4,079

Subtotals - Gross loans		1,114,058			1,121,487			1,145,060			1,120,947			1,041,769
Loans in process of disbursement		(20,839	)		(31,359	)		(35,404	)		(61,308	)		(57,448	)

Subtotals - Disbursed loans		1,093,219			1,090,128			1,109,656			1,059,639			984,321
Net deferred loan costs		669			649			630			605			542
Allowance for credit losses		(12,494	)		(12,302	)		(12,267	)		(11,922	)		(11,593	)

Total loans receivable	$	1,081,394		$	1,078,475		$	1,098,019		$	1,048,322		$	973,270

PSB Holding, Inc.
Selected Commercial Real Estate Loans by Purpose
	Mar 31,				Dec 31,				Sept 30,				June 30,				Mar 31,
(dollars in thousands)		2024				2023				2023				2023				2023

	Total Exposure		% of Portfolio (1)		Total Exposure		% of Portfolio (1)		Total Exposure		% of Portfolio (1)		Total Exposure		% of Portfolio (1)		Total Exposure		% of Portfolio (1)
Multi Family	$	142,001	14.4	%	$	132,386	13.2	%	$	133,466	13.3	%	$	119,573	12.4	%	$	121,559	13.0	%
Industrial and Warehousing		85,409	8.6			83,817	8.3			88,906	8.9			84,049	8.7			78,934	8.5
Retail		33,177	3.4			35,419	3.5			35,281	3.5			34,004	3.5			34,427	3.7
Hotels		35,105	3.6			36,100	3.6			31,819	3.2			33,329	3.5			31,069	3.3
Office		6,655	0.7			6,701	0.7			6,746	0.7			8,395	0.9			8,544	0.9

(1) Percentage of commercial and commercial real estate portfolio and commitments.

PSB Holdings, Inc.
Deposit Composition

Insured and Collateralized Deposits	March 31,				December 31,				September 30,				June 30,				March 31,
(dollars in thousands)		2024				2023				2023				2023				2023
	$		%		$		%		$		%		$		%		$		%

Non-interest bearing demand	$	199,077	17.8	%	$	197,571	17.3	%	$	209,133	17.8	%	$	201,351	17.6	%	$	205,350	18.6	%
Interest-bearing demand and savings		318,672	28.7	%		317,984	27.8	%		307,620	26.3	%		310,006	27.1	%		329,364	29.7	%
Money market deposits		143,167	12.9	%		142,887	12.5	%		135,910	11.6	%		126,851	11.1	%		128,576	11.6	%
Retail and local time deposits <= $250		148,404	13.3	%		149,145	13.1	%		144,733	12.3	%		140,572	12.3	%		136,090	12.3	%

Total core deposits		809,320	72.7	%		807,587	70.7	%		797,396	68.0	%		778,780	68.1	%		799,380	72.2	%
Retail and local time deposits > $250		24,508	2.3	%		23,000	2.0	%		22,750	1.9	%		20,250	1.8	%		17,000	1.5	%
Broker & national time deposits <= $250		2,229	0.2	%		3,470	0.3	%		3,222	0.3	%		3,965	0.3	%		5,953	0.5	%
Broker & national time deposits > $250		61,752	5.5	%		70,020	6.1	%		88,614	7.6	%		93,956	8.2	%		74,485	6.8	%

Totals	$	897,809	80.7	%	$	904,077	79.1	%	$	911,982	77.8	%	$	896,951	78.4	%	$	896,818	81.0	%

PSB Holdings, Inc.
Deposit Composition

Uninsured Deposits	March 31,				December 31,				September 30,				June 30,				March 31,
(dollars in thousands)		2024				2023				2023				2023				2023
	$		%		$		%		$		%		$		%		$		%

Non-interest bearing demand	$	48,532	4.4	%	$	69,258	6.1	%	$	79,632	6.8	%	$	80,802	7.1	%	$	62,486	5.6	%
Interest-bearing demand and savings		20,535	1.8	%		20,316	1.8	%		22,847	1.9	%		22,604	2.0	%		24,854	2.2	%
Money market deposits		124,766	11.2	%		124,518	10.9	%		133,653	11.4	%		127,871	11.2	%		109,894	10.0	%
Retail and local time deposits <= $250		-	0.0	%		-	0.0	%		-	0.0	%		-	0.0	%		-	0.0	%

Total core deposits		193,833	17.4	%		214,092	18.8	%		236,132	20.1	%		231,277	20.3	%		197,234	17.8	%
Retail and local time deposits > $250		21,710	1.9	%		23,633	2.1	%		24,120	2.1	%		14,906	1.3	%		13,541	1.2	%
Broker & national time deposits <= $250		-	0.0	%		-	0.0	%		-	0.0	%		-	0.0	%		-	0.0	%
Broker & national time deposits > $250		-	0.0	%		-	0.0	%		-	0.0	%		-	0.0	%		-	0.0	%

Totals	$	215,543	19.3	%	$	237,725	20.9	%	$	260,252	22.2	%	$	246,183	21.6	%	$	210,775	19.0	%


PSB Holdings, Inc.
Deposit Composition

Total Deposits	March 31,				December 31,				September 30,				June 30,				March 31,
(dollars in thousands)		2024				2023				2023				2023				2023
	$		%		$		%		$		%		$		%		$		%

Non-interest bearing demand	$	247,609	22.2	%	$	266,829	23.4	%	$	288,765	24.7	%	$	282,153	24.7	%	$	267,836	24.2	%
Interest-bearing demand and savings		339,207	30.5	%		338,300	29.6	%		330,467	28.2	%		332,610	29.1	%		354,218	32.0	%
Money market deposits		267,933	24.1	%		267,405	23.4	%		269,563	22.8	%		254,722	22.3	%		238,470	21.5	%
Retail and local time deposits <= $250		148,404	13.3	%		149,145	13.1	%		144,738	12.4	%		140,572	12.3	%		136,090	12.3	%

Total core deposits		1,003,153	90.1	%		1,021,679	89.5	%		1,033,533	88.1	%		1,010,057	88.4	%		996,614	90.0	%
Retail and local time deposits > $250		46,218	4.2	%		46,633	4.1	%		46,870	4.0	%		35,156	3.1	%		30,541	2.8	%
Broker & national time deposits <= $250		2,229	0.2	%		3,470	0.3	%		3,222	0.3	%		3,965	0.3	%		5,953	0.5	%
Broker & national time deposits > $250		61,752	5.5	%		70,020	6.1	%		88,614	7.6	%		93,956	8.2	%		74,485	6.7	%

Totals	$	1,113,352	100.0	%	$	1,141,802	100.0	%	$	1,172,239	100.0	%	$	1,143,134	100.0	%	$	1,107,593	100.0	%

PSB Holdings, Inc.
Average Balances ($000) and Interest Rates
(dollars in thousands)


	Quarter ended March 31, 2024							Quarter ended December 31, 2023							Quarter ended March 31, 2023
	Average					Yield /		Average					Yield /		Average					Yield /
	Balance			Interest		Rate		Balance			Interest		Rate		Balance			Interest		Rate
Assets
Interest-earning assets:
Loans (1)(2)	$	1,094,321		$	15,199	5.59	%	$	1,094,152		$	14,974	5.43	%	$	976,395		$	11,788	4.90	%
Taxable securities		171,788			1,197	2.80	%		167,366			1,147	2.72	%		199,705			1,331	2.70	%
Tax-exempt securities (2)		80,434			666	3.33	%		80,922			673	3.30	%		81,932			680	3.37	%
FHLB stock		6,499			165	10.21	%		6,373			158	9.84	%		3,059			50	6.63	%
Other		12,885			178	5.56	%		11,846			162	5.43	%		9,024			98	4.40	%

Total (2)		1,365,927			17,405	5.12	%		1,360,659			17,114	4.99	%		1,270,115			13,947	4.45	%

Non-interest-earning assets:
Cash and due from banks		17,367							16,243							17,255
Premises and equipment,
net		13,183							13,243							13,332
Cash surrender value ins		24,144							23,990							24,982
Other assets		21,201							22,406							23,193
Allowance for credit
losses		(12,385	)						(12,301	)						(12,366	)

Total	$	1,429,437						$	1,424,240						$	1,336,511

Liabilities & stockholders' equity
Interest-bearing liabilities:
Savings and demand
deposits	$	350,497		$	1,672	1.92	%	$	327,036		$	1,296	1.57	%	$	373,557		$	1,053	1.14	%
Money market deposits		274,186			1,897	2.78	%		272,087			1,820	2.65	%		225,624			830	1.49	%
Time deposits		264,657			2,513	3.82	%		273,332			2,410	3.50	%		245,562			1,106	1.83	%
FHLB borrowings		142,926			1,450	4.08	%		133,560			1,349	4.01	%		68,833			547	3.22	%
Other borrowings		8,554			60	2.82	%		6,999			54	3.06	%		10,025			62	2.51	%
Senior sub. notes		4,775			59	4.97	%		4,773			59	4.90	%		5,159			62	4.87	%
Junior sub. debentures		12,934			251	7.81	%		12,909			254	7.81	%		12,832			234	7.40	%

Total		1,058,529			7,902	3.00	%		1,030,696			7,242	2.79	%		941,592			3,894	1.68	%

Non-interest-bearing liabilities:
Demand deposits		248,670							275,944							279,348
Other liabilities		12,765							12,540							12,208
Stockholders' equity		109,473							105,060							103,363

Total	$	1,429,437						$	1,424,240						$	1,336,511

Net interest income				$	9,503						$	9,872						$	10,053
Rate spread						2.12	%						2.20	%						2.77	%
Net yield on interest-earning assets						2.80	%						2.88	%						3.21	%

(1) Nonaccrual loans are included in the daily average loan balances outstanding.
(2) The yield on federally tax-exempt loans and securities is computed on a tax-equivalent basis using a federal tax rate of 21%.

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