Pivdencom Bank http://pivdencombank.com/ Tue, 10 May 2022 10:46:09 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://pivdencombank.com/wp-content/uploads/2021/06/cropped-favicon-32x32.png Pivdencom Bank http://pivdencombank.com/ 32 32 PRIME MERIDIAN HOLDING CO Management’s Discussion and Analysis of Financial Condition and Results of Operations (Form 10-Q) https://pivdencombank.com/prime-meridian-holding-co-managements-discussion-and-analysis-of-financial-condition-and-results-of-operations-form-10-q/ Tue, 10 May 2022 10:46:09 +0000 https://pivdencombank.com/prime-meridian-holding-co-managements-discussion-and-analysis-of-financial-condition-and-results-of-operations-form-10-q/
Management's discussion and analysis is presented to aid the reader in
understanding and evaluating the financial condition and results of operations
of Prime Meridian Holding Company, and its wholly-owned subsidiary, Prime
Meridian Bank. This discussion and analysis should be read with the condensed
consolidated financial statements, the footnotes thereto, and the other
financial data included in this report and in our annual report on Form 10-K for
the year ended December 31, 2021. Results of operations for the three months
ended March 31, 2022are not necessarily indicative of results that may be
attained for any other period. The following discussion and analysis present our
financial condition and results of operations on a consolidated basis, however,
because we conduct all of our material business operations through the Bank, the
discussion and analysis relate to activities primarily conducted at the
subsidiary level.



Certain information in this report may include "forward-looking statements" as
defined by federal securities law. Words such as "may," "could," "should,"
"would," "believe," "anticipate," "estimate," "expect," "intend," "plan,"
"project," "is confident that," and similar expressions are intended to identify
these forward-looking statements. These forward-looking statements involve risk
and uncertainty and a variety of factors could cause our actual results and
experience to differ materially from the anticipated results or other
expectations expressed in these forward-looking statements. We do not have a
policy of updating or revising forward-looking statements except as otherwise
required by law, and silence by management over time should not be construed to
mean that actual events are occurring as estimated in such forward-looking
statements.



Our ability to predict results or the effect of future plans or strategies is
inherently uncertain. Factors that could have a material adverse effect on our
and our subsidiary's operations include, but are not limited to, changes in:



  • local, regional, and national economic and business conditions;


  • banking laws, compliance, and the regulatory environment;

WE and global securities markets, public debt markets and other capital

    markets;


  • monetary and fiscal policies of the U.S. Government;


  • litigation, tax, and other regulatory matters;

• the demand for banking services, loan and deposit products in our market

    area;


  • quality and composition of our loan or investment portfolios;


  • risks inherent in making loans such as repayment risk and fluctuating
    collateral values;


  • competition;

• attract and retain key personnel, including our management team and

administrators;

• technology, product distribution channels, end-user demands and customer acceptance.

    new products;


  • consumer spending, borrowing and savings habits;


  • any failure or breach of our operational systems, information systems or
    infrastructure, or those of our third-party vendors and other service
    providers; including cyber-attacks;

• natural disasters, public unrest, bad weather, pandemics, public health,

and other conditions affecting our operations or those of our customers;

• other economic, competitive, governmental, regulatory or technological aspects

the factors that affect us; and

• application and interpretation of accounting principles and guidelines.




                                       24
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GENERAL



Prime Meridian Holding Company ("PMHG") was incorporated as a Florida
corporation on May 25, 2010, and is the one-bank holding company for, and sole
shareholder of, Prime Meridian Bank (the "Bank") (collectively, the "Company").
The Bank opened for business on February 4, 2008 and was acquired by PMHG on
September 16, 2010. PMHG has no significant operations other than owning the
stock of the Bank. The Bank offers a broad array of commercial and retail
banking services through four full-service offices located in Tallahassee,
Crawfordville, and Lakeland, Florida and through its online banking platform.



As a one-bank holding company, we generate most of our revenue from interest on
loans and investments. Our primary source of funding for our loans is deposits.
Our largest expenses are interest on those deposits and salaries and employee
benefits. We measure our performance through our net interest margin, return on
average assets, and return on average equity, while maintaining appropriate
regulatory leverage and risk-based capital ratios.



The following table shows selected information for the periods ended or at the
dates indicated:



                                                        At or for the
                                     Three Months           Year            Three Months
                                        Ended               Ended              Ended
                                                        December 31,
                                    March 31, 2022          2021           March 31, 2021
Average equity as a percentage
of average assets                              8.28 %            8.67 %               9.00 %
Equity to total assets at end of
period                                         7.59              7.97                 8.48
Return on average assets(1)                    1.05              1.11                 1.32
Return on average equity(1)                   12.70             12.81                14.72
Noninterest expense to average
assets(1)                                      1.77              1.87       

1.95

Nonperforming loans to total
loans at end of period                            -                 -       

0.16

Nonperforming assets to total
assets                                            -                 -                 0.11



(1) Annualized for the three months ended March 31, 2022 and 2021



CRITICAL ACCOUNTING POLICIES



Our critical accounting policies which involve significant judgments and
assumptions that have a material impact on the carrying value of certain assets
and liabilities and used in preparation of the Condensed Consolidated Financial
Statements as of March 31, 2022, have remained unchanged from the disclosures
presented in our Annual Report on Form 10-K for the year ended December 31,
2021.



COVID-19 UPDATE



The extent to which the COVID-19 pandemic may continue to impact our business,
results of operations, and financial condition, as well as our regulatory
capital and liquidity ratios will depend on future developments. We continue to
monitor the state of the pandemic and national and local responses to ensure the
safety of our clients and employees.  At March 31, 2022, all loans which were on
payment deferrals or modifications have reverted back to their premodification
terms.





                                       25
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FINANCIAL CONDITION



Average assets totaled $852.8 million and $674.8 million for the three months
ended March 31, 2022 and 2021, respectively, an increase of $178.0 million, or
26.4%, over the comparable period in 2021. Comparing the first quarters of
2021 and 2022, 79.0% of the growth in average assets stemmed from an increase in
other interest-earning assets funded by higher deposit inflows. The average
balance of PPP loans decreased $61.2 million to $9.7 million from the first
quarter of 2021 to the first quarter of 2022.



Investment Securities. Our primary objective in managing our investment
portfolio is to maintain a portfolio of high quality, highly liquid investments
yielding competitive returns. We use the investment securities portfolio for
several purposes. It serves as a vehicle to manage interest rate and prepayment
risk, to generate interest and dividend income, to provide liquidity to meet
funding requirements, and to provide collateral for pledging to secure the
deposit of public funds at the Bank. At March 31, 2022, our debt securities
investment portfolio included U.S. government agency securities, U.S. government
treasury securities, municipal securities, mortgage-backed securities, and
asset-backed securities. As of the same date, this portfolio had a fair market
value of $107.7 million and an amortized cost value of $112.5 million. At March
31, 2022 and December 31, 2021, our investment securities portfolio represented
approximately 12.5% and 8.8% of our total assets, respectively. The average
yield on the average balance of investment securities for the three months ended
March 31, 2022 was 1.83%, compared to 1.67% for the comparable period in 2021.



Loans. Our primary earning asset is our loan portfolio and our primary source of
income is the interest earned on the loan portfolio. Our loan portfolio consists
of commercial real estate loans, construction loans, and commercial loans made
to small-to-medium sized companies and their owners, as well as residential real
estate loans, including first and second mortgages, and consumer loans. Our goal
is to maintain a high-quality portfolio of loans through sound underwriting and
lending practices. We work diligently to attract new lending clients through
direct solicitation by our loan officers, utilizing relationship networks from
existing clients, competitive pricing, and innovative structure. Our loans are
priced based upon the degree of risk, collateral, loan amount, and maturity.



Excluding $10.2 million in PPP loan forgiveness during the first quarter of
2022, the Company's net loan growth was essentially flat from year-end. Strong
loan production ($32.8 million in new fundings) and $19.9 million in draws on
existing facilities were offset by approximately $41.9 million in loan
prepayments and $11.9 million in curtailments and amortization. At March 31,
2022, PPP loans comprised $4.9 million, or 1.0%, of total loans.  The remaining
fees to be collected on this balance, net of costs, totals $274,000.  In total,
approximately 83.4% of the total loan portfolio was collateralized by commercial
and residential real estate mortgages at March 31, 2022 compared to 82.7% at
December 31, 2021.



Nonperforming assets.  At March 31, 2022 and December 31, 2021, the Company had
no nonperforming assets. We generally place loans on nonaccrual status when they
become 90 days or more past due, unless they are well secured and in the process
of collection. We also place loans on nonaccrual status if they are less than 90
days past due if the collection of principal or interest is in doubt. When a
loan is placed on nonaccrual status, any interest previously accrued, but not
collected, is reversed from income. At March 31, 2022, and December 31, 2021,
the Bank had no loans on nonaccrual status. Accounting standards require the
Company to identify loans as impaired loans when, based on current information
and events, it is probable that the Company will be unable to collect the
scheduled payments of principal or interest when due according to the
contractual terms of the loan agreement. These standards require that impaired
loans be valued at the present value of expected future cash flows, discounted
at the loan's effective interest rate, using one of the following methods: the
observable market price of the loan or the fair value of the underlying
collateral if the loan is collateral dependent. We implement these standards in
our monthly review of the adequacy of the allowance for loan losses and identify
and value impaired loans in accordance with GAAP.



Allowance for Loan Losses. Management's policy is to maintain the allowance for
loan losses at a level sufficient to absorb probable losses inherent in the loan
portfolio as of the balance sheet date. The allowance is increased by the
provision for loan losses and decreased by charge-offs, net of recoveries.
During the first quarter of 2022, the Bank reported a $371,000 credit for loan
losses due to flat loan growth (excluding PPP activity) and a $284,000 net
recovery during the quarter which reduced the historical loss factor on
commercial loans by 19 basis points. Management believes the allowance for loan
losses, which was $5.9 million or 1.22% of gross loans (excluding PPP
loans) at March 31, 2022 is adequate to cover losses inherent in the loan
portfolio.



Deposits. Deposits are the major source of the Company's funds for lending and
other investment purposes. Total deposits at March 31, 2022 were $787.9 million,
an increase of $25.0 million, or 3.3%, from December 31, 2021, with growth
coming from savings, NOW, and money-market accounts and attributed to expansion
of existing relationships and the addition of new clients. Management believes
that the potential exists for our deposit levels to fluctuate in the near future
due to the unprecedented level of liquidity in the market following the stimulus
efforts put in place to curtail the negative economic impact of the COVID-19
pandemic. The average balance of noninterest-bearing deposits accounted for
26.9% of the average balance of total deposits for the three months ended March
31, 2022, compared to 28.6% for the three months ended March 31, 2021.



Borrowings. The Bank has an agreement with the Federal Home Loan Bank of Atlanta
("FHLB") and pledges its qualified loans as collateral which would allow the
Bank, as of March 31, 2022, to borrow up to $86.5 million. In addition, the
Bank maintains unsecured lines of credit with correspondent banks that totaled
$47.0 million at March 31, 2022. There were no outstanding balances under any of
these lines at March 31, 2022.



In 2020, the Company entered into a Promissory Note (the "Note") and a Security
Agreement with Thomasville National Bank ("TNB"). Pursuant to the Note, the
Company obtained a $15 million revolving line of credit with a 5-year term. The
interest rate adjusts daily to the then-current Wall Street Journal Prime Rate
and was 3.50% at March 31, 2022.  Pursuant to the Security Agreement, the
Company has pledged to TNB all of the outstanding shares of common stock of the
Company's wholly-owned subsidiary, the Bank.  At March 31, 2022, the Company had
a $3,975,000 outstanding loan balance and incurred $31,000 in year-to-date
interest expense under this line.



                                       26
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RESULTS OF OPERATIONS



Net interest income constitutes the principal source of income for the Bank and
results from the excess of interest income on interest-earning assets over
interest expense on interest-bearing liabilities. The principal interest-earning
assets are investment securities and loans. Interest-bearing liabilities
primarily consist of time deposits, interest-bearing checking accounts, savings
deposits, and money-market accounts. Funds attracted by these interest-bearing
liabilities are invested in interest-earning assets. Accordingly, net interest
income depends upon the volume of average interest-earning assets and average
interest-bearing liabilities as well as the interest rates earned or paid on
these assets and liabilities. The following tables set forth information
regarding: (i) the total dollar amount of interest and dividend income of the
Company from interest-earning assets and the resultant average yields; (ii) the
total dollar amount of interest expense on interest-bearing liabilities and the
resultant average costs; (iii) net interest income; (iv) interest-rate spread;
(v) net interest margin; and (vi) weighted-average yields and rates. Yields and
costs were derived by dividing annualized income or expense by the average
balance of assets or liabilities. The yields and costs depicted in the table
include the amortization of fees, which are considered to constitute adjustments
to yields.



As shown in the following table, there was compression in the Company's net
interest margin for the three month period ended March 31, 2022 due to a shift
in the asset mix towards lower-yielding earning assets triggered by excess
liquidity in the market and the resulting high level of cash balances on the
Bank's balance sheet.


                                                For the Three Months Ended March 31,
                                          2022                                         2021
                                       Interest                                     Interest
                         Average         and           Yield/         Average         and           Yield/
(dollars in
thousands)               Balance      Dividends        Rate(5)        Balance      Dividends        Rate(5)
Interest-earning
assets:
Loans(1)                $ 489,263     $    5,684            4.65 %   $ 484,455     $    5,699            4.71 %
Loans held for sale        10,550            100            3.79        13,370            106            3.17
Debt securities
available for sale         84,088            385            1.83        59,629            249            1.67
Other(2)                  230,348            124            0.22        89,646             49            0.22

Total

earning interest

assets                    814,249     $    6,293            3.09 %     647,100     $    6,103            3.77 %
Noninterest-earning
assets                     38,599                                       27,743
Total assets            $ 852,848                                    $ 674,843

Interest-bearing
liabilities:
Savings, NOW and
money-market deposits   $ 517,506     $      335            0.26 %   $ 379,031     $      401            0.42 %
Time deposits              48,920             68            0.56        54,456            136            1.00

Total

interest bearing

deposits                  566,426            403            0.28       433,487            537            0.50
Other borrowings            3,717             31            3.34            17              -               -
Total
interest-bearing
liabilities               570,143     $      434            0.30 %     433,504     $      537            0.50 %

Not bearing interest

deposits                  208,793                                      

173,997

Not bearing interest

liabilities                 3,328                                        

6,638

Stockholders' equity       70,584                                       

60,704

Total liabilities and
stockholders' equity    $ 852,848                                    $ 

674 843


Net earning assets      $ 244,106                                    $ 213,596
Net interest income                   $    5,859                                   $    5,566
Interest rate spread
(3)                                                         2.79 %                                       3.27 %
Net interest
margin(4)                                                   2.88 %                                       3.44 %

Ratio of
interest-earning
assets to average
interest-bearing
liabilities                142.81 %                                     149.27 %



(1)   Includes nonaccrual loans
(2)   Other interest-earning assets include
federal funds sold, interest-bearing deposits and
FHLB stock.
(3)  Interest rate spread is the difference
between the total interest-earning asset yield
and the rate paid on total interest-bearing
liabilities.
(4)   Net interest margin is net interest income
divided by total average interest-earning assets,
annualized
(5)   Annualized




                                       27
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Comparison of Operating Results for the Three Months Ended March 31, 2022
And 2021

Earnings Summary
(dollars in thousands)
                                                                Change 1Q'22 vs. 1Q'21
                                       1Q'22       1Q'21         Amount         Percentage
Net Interest Income                  $ 5,859     $ 5,566     $      293                5.3 %
Provision (credit) for loan losses      (371 )         -           (371 )                -
Noninterest income                       518         672           (154 )            (22.9 )
Noninterest expense                    3,780       3,297            483               14.6
Income Taxes                             727         707             20                2.8
Net earnings                         $ 2,241     $ 2,234     $        7                0.3 %




Compared to the same period a year ago, net earnings were relatively flat as
higher interest income from securities and deposits with banks, lower interest
expense, and the credit for loan losses were offset by lower noninterest income,
higher noninterest expense and slightly higher income taxes.



Net Interest Income



Our operating results depend primarily on our net interest income, which is the
difference between interest and dividend income on interest-earning assets such
as loans and securities, and interest expense on interest-bearing liabilities
such as deposits.



Interest income
(dollars in thousands)
                                                    Change 1Q'22 vs. 1Q'21
                           1Q'22       1Q'21         Amount         Percentage
Interest income:
Loans                    $ 5,784     $ 5,805     $      (21 )             (0.4 %)
Securities                   385         249            136               54.6
Other                        124          49             75              153.1
Total interest income    $ 6,293     $ 6,103     $      190                3.1 %
Interest expense:
Deposits                     403         537     $     (134 )            (25.0 %)
Other borrowings              31           -             31                N/A
Total interest expense       434         537           (103 )            (19.2 )
Net interest income      $ 5,859     $ 5,566     $      293                5.3 %




Compared to the first quarter of 2021, the increase in net interest income
resulted from higher interest income on securities and deposits with banks
(driven by both volume and rate) and lower interest expense (due to management's
strategic reduction of deposit costs in the first quarter). Fee and interest
income from PPP loans declined $529,000 when compared to the first quarter of
2021 as the majority of PPP loans have moved through the forgiveness
process. Despite higher balances of interest-bearing liabilities, total interest
expense declined $103,000 from the first quarter of 2021 as the average rate
paid on interest-bearing liabilities declined 20 basis points from the first
quarter of 2021. The Company's net interest margin of 2.88% was down 56 basis
points from the first quarter of 2021, primarily attributed to the shift in the
earning asset mix from PPP loans to cash.



                                       28
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Provision for Loan Losses



The provision for loan losses is charged to earnings to increase the total loan
loss allowance to a level deemed appropriate by management. The provision is
based upon the volume and type of lending conducted by the Bank, industry
standards, general economic conditions, particularly as they relate to our
market areas, and other factors related to our historic loss experience and the
collectability of the loan portfolio. Excluding PPP activity, net loan growth
from December 31, 2021 was essentially flat. In addition, the Bank realized
a $284,000 net recovery during the first quarter of 2022 which reduced the
historical loss factor on commercial loans by 19 basis points.  The combination
of these factors led to a $371,000 credit for loan losses in the first quarter
of 2022.



While management believes the estimates and assumptions used in its
determination of the adequacy of the allowance are reasonable, there can be no
assurance that such estimates and assumptions will not be proven incorrect in
the future, or that the actual amount of future losses will not exceed the
amount of the established allowance for loan losses, or that any increased
allowance for loan losses that may be required will not adversely impact our
financial condition and results of operations. In addition, the determination of
the amount of our allowance for loan losses is subject to review by bank
regulators, as part of the routine examination process, which may result in
additions to our provision for loan losses based upon their judgment of
information available to them at the time of examination.



Noninterest income
(dollars in thousands)                                                       Change 1Q'22 vs. 1Q'21
                                                1Q'22          1Q'21         Amount          Percentage
Service charges and fees on deposit
accounts                                   $       68     $       53     $       15                28.3 %
Debit card/ATM revenue, net                       129            109             20                18.3
Mortgage banking revenue, net                     165            301           (136 )             (45.2 )
Income from bank-owned life insurance              95             63             32                50.8
Gain on sale of debt securities
available for sale                                  -            108           (108 )            (100.0 )
Other income                                       61             38             23                60.5
Total noninterest income                   $      518     $      672     $     (154 )             (22.9 %)



Compared to a year ago, the two main drivers of the decline in non-interest income were lower income from mortgage banks and the lack of a gain on the sale of available-for-sale debt securities. The decline in Mortgage Banking revenue was anticipated given rising rates and the high level of refinancing activity that occurred in 2021.



Noninterest expense
(dollars in thousands)                                            Change 1Q'22 vs. 1Q'21
                                          1Q'22       1Q'21        Amount        Percentage

Salaries and benefits $2,160 $1,852 $308

           16.6 %
Occupancy and equipment                     408         386            22               5.7
Professional fees                           146         130            16              12.3
Marketing                                   167         140            27              19.3
FDIC Assessment                             124          70            54              77.1
Software maintenance and amortization       242         250            (8 )            (3.2 )
Other                                       533         469            64              13.6
Total noninterest expense               $ 3,780     $ 3,297     $     483              14.6 %




Compared to the same period a year ago, nearly half of the increase in total
noninterest expense is attributed to increased salaries.  The Bank reported
higher head count with 99 full-time equivalents (FTEs) at March 31, 2022
compared to 88 FTEs a year ago.  Annual raises, higher group insurance costs,
higher incentive accrual, and increases to other employee benefit accounts also
contributed to the overall increase.



Income Taxes



Income taxes are based on amounts reported in the condensed consolidated
statements of earnings after adjustments for nontaxable income and nondeductible
expenses and consist of taxes currently due plus deferred taxes on temporary
differences in the recognition of income and expense for tax and financial
statement purposes. Income taxes were $727,000 for the three months ended March
31, 2022, compared to income taxes of $707,000 for the three months ended March
31, 2021, with the increase attributed to slightly higher pre-tax earnings
in 2022. The effective tax rate was 24.5% in the first quarter of 2022 versus
24.0% in the first quarter of 2021.



                                       29
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LIQUIDITY



Liquidity describes our ability to meet financial obligations, including lending
commitments and contingencies, which arise during the normal course of business.
Liquidity is primarily needed to meet the borrowing and deposit withdrawal
requirements of the Company's clients, as well as meet current and planned
expenditures. Management monitors the liquidity position daily.



Our liquidity is derived primarily from our deposit base, scheduled amortization
and prepayments of loans and investment securities, funds provided by
operations, and capital. Additionally, as a commercial bank, we are expected to
maintain an adequate liquidity position. The liquidity position may consist of
cash on hand, cash on demand deposit with correspondent banks, federal funds
sold, and unpledged marketable securities such as United States government
agency securities, municipal securities, mortgage-backed securities, and
asset-backed securities.



The Bank also has external sources of funds through the FHLB, unsecured lines of
credit with correspondent banks, and the State of Florida's Qualified Public
Deposit ("QPD") Program. At March 31, 2022, the Bank had access to approximately
$86.5 million of available lines of credit secured by qualifying collateral with
the FHLB, in addition to $47.0 million in unsecured lines of credit maintained
with correspondent banks.


The Company has a $15 million revolving line of credit with TNB. From March 31, 2022the Company’s outstanding borrowings under this line amount to $3,975,000.




Some of our securities are pledged to collateralize certain deposits through our
participation in the State of Florida's QPD program. The market value of
securities pledged to the QPD program was $13.6 million at March 31, 2022
compared to $11.9 million at December 31, 2021. Our primary liquid assets,
excluding assets pledged to the QPD program, accounted for 37.9% and 35.1% of
total assets at March 31, 2022 and December 31, 2021, respectively.



Our core deposits consist of noninterest-bearing accounts, NOW accounts,
money-market accounts, time deposits $250,000 or less, and savings accounts. We
closely monitor our level of certificates of deposit greater than $250,000 and
other large deposits. At March 31, 2022, total deposits were $787.9 million, of
which $20.0 million were in certificates of deposits greater than $250,000,
excluding Individual Retirement Accounts (IRAs). We maintain a Contingency
Funding Plan ("CFP") that identifies liquidity needs and weighs alternate
courses of action designed to address those needs in emergency situations. We
perform a monthly cash flow analysis and stress test the CFP to evaluate the
expected funding needs and funding capacity during a liquidity stress event. We
believe that the sources of available liquidity are adequate to meet all
reasonably immediate short-term and intermediate-term demands and do not know of
any trends, events, or uncertainties that may result in a significant adverse
effect on our liquidity position.



CAPITAL RESOURCES



Stockholders' equity was $65.8 million at March 31, 2022 compared to
$67.0 million at December 31, 2021. The $1.3 million change in equity is mostly
attributed to a $3.3 million increase in the unrealized losses of our investment
portfolio, partially offset by retention of earnings. In 2020, the Company
obtained a $15 million revolving line of credit with TNB. At its discretion, the
Company may take draws on that line and may contribute the proceeds as capital
to the Bank.  During the first quarter of 2022, the Company made a $400,000 draw
under this line that was used to partially fund the $567,000 cash dividend to
shareholders. At March 31, 2022, the Company had a $3,975,000 outstanding loan
balance and incurred year-to-date interest expense of $31,000 under this
revolving line of credit.


At March 31, 2022, the Bank was considered to be "well capitalized" under the
FDIC's Prompt Corrective Action regulations with an 8.56% Tier 1 Leverage
Capital Ratio, a 13.60% Equity Tier 1 Risk-Based Capital Ratio, a 13.60% Tier 1
Risk-Based Capital Ratio, and a 14.70% Total Risk-Based Capital Ratio, all above
the minimum ratios to be considered "well capitalized."



The following is a summary at March 31, 2022 and December 31, 2021 of the
regulatory capital requirements to be "well capitalized" and the Bank's capital
position.



                                                            For Capital Adequacy               For Well Capitalized
                                  Actual                          Purposes                           Purposes
(dollars in
thousands)               Amount        Percentage         Amount          Percentage        Amount           Percentage
As of March 31, 2022
Tier 1 Leverage
Capital                 $  72,985             8.56 %   $     34,098              4.00 %   $    42,623               5.00 %
Common Equity Tier 1
Risk-based Capital         72,985            13.60           24,145              4.50          34,876               6.50
Tier 1 Risk-based
Capital                    72,985            13.60           32,193              6.00          42,924               8.00
Total Risk-based
Capital                    78,872            14.70           42,924              8.00          53,655              10.00

As of December 31,
2021
Tier 1 Leverage
Capital                 $  70,548             8.53 %   $     33,071              4.00 %   $    41,338               5.00 %
Common Equity Tier 1
Risk-based Capital         70,548            13.45           23,596              4.50          34,083               6.50
Tier 1 Risk-based
Capital                    70,548            13.45           31,461              6.00          41,948               8.00
Total Risk-based
Capital                    76,522            14.59           41,948              8.00          52,435              10.00




                                       30
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The Bank is also subject to the following capital threshold requirements under the FDIC Quick Remedies Regulations.



                                                   Threshold Ratios
                                                               Common
                                                               Equity
                                         Total      Tier 1     Tier 1    Tier 1
                                       Risk-Based Risk-Based Risk-Based Leverage
                                        Capital    Capital    Capital   Capital
Capital Category                         Ratio      Ratio      Ratio     Ratio

Well capitalized                         10.00%     8.00%      6.50%     5.00%

Adequately Capitalized                   8.00%      6.00%      4.50%     4.00%

Undercapitalized                        < 8.00%    < 6.00%    < 4.50%   < 4.00%

Significantly underfunded < 6.00% < 4.00% < 3.00% < 3.00%


Critically Undercapitalized                Tangible Equity/Total Assets ? 2%



Until PMHG has $3 billion in total consolidated assets, it will not be subject to any consolidated capital requirement.

OFF-BALANCE SHEET ARRANGEMENTS




Refer to Note 10 in the notes to condensed consolidated financial statements
included in this Form 10-Q for the period ending March 31, 2022 for a discussion
of off-balance sheet arrangements.

© Edgar Online, source Previews

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UK’s high inflation could last ‘for years rather than months’, economist warns | Inflation https://pivdencombank.com/uks-high-inflation-could-last-for-years-rather-than-months-economist-warns-inflation/ Mon, 09 May 2022 22:17:00 +0000 https://pivdencombank.com/uks-high-inflation-could-last-for-years-rather-than-months-economist-warns-inflation/

Pressure on UK households from high inflation could be greater and last longer than expected, amid a series of economic shocks from Brexit, Covid and Russia’s war in Ukraine, economists have warned .

Michael Saunders, a member of the Bank of England’s Monetary Policy Committee (MPC), said inflation was “uncomfortably high” as households come under pressure from soaring energy, food and utility bills. fuel.

The Independent Economist, who voted for a bigger increase in borrowing costs last week than most of his MPC colleagues, said he fears expectations of higher inflation are no longer taking root longer than expected.

“Energy price cuts are painful. They hit those with the lowest incomes the most,” he said.

His warning was echoed by Andy Haldane, the Bank’s former chief economist who now heads the Royal Society for Arts think tank, who said high inflation rates could last “for years rather than month”.

Haldane, who was among the most prominent economists to sound the alarm over inflation risks before he left the Bank last year, told LBC radio station he wanted tougher action to be taken. earlier.

When asked if inflation could exceed 10% or go even higher, he replied: “It is possible. I’m afraid it might…I’m a little afraid, it might also last a little while. It won’t come and go in a few months. I think it could take years rather than months.

Threadneedle Street raised its benchmark rate by 0.25 percentage points to a 13-year high of 1% last week to tackle soaring inflation, despite warnings there were growing risks of recession caused by the cost of living crisis.

The Bank said the measure of the annual rise in the cost of living could exceed 10% later this year, but would likely fall back towards its 2% target within three years as the economic shocks of Covid and of the war in Ukraine are gradually fading. .

Saunders, who along with two other members of the nine-member MPC was in the minority calling for a harsher rate hike of 0.5 percentage points, said it would be better to raise the costs of borrow more aggressively now to stop persistently high rates of inflation in the future.

“I place considerable weight on risks which, unless controlled by monetary policy, domestic capacity and inflationary pressures would likely be larger and more persistent than central forecasts,” he said in a statement. speech to the Resolution Foundation think tank.

Such a plan could help avoid more aggressive hikes to hit the 2% target in the future, which “could be very costly in economic terms,” he said.

Saunders, who is due to leave the MPC in August, said the UK economy was suffering a “series of major shocks” from Brexit, the Covid pandemic and soaring energy prices, as well as the effects longer term of an aging population.

Labor shortages and lack of business investment could have been exacerbated by leaving the EU, he said, at a time when a mismatch between supply and demand in the labor market forced employers to increase workers’ wages.

“Brexit-related costs appear to have played some role, although this effect has diminished recently as one-off cost increases start to fade from the annual comparison,” he said.

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Driven by unemployment at the lowest level in 40 years and record vacancies, Threadneedle Street expects average wage growth to reach 6% this year. However, this remains well below inflation, adding pressure on workers, while average wage settlements are expected to fall next year.

Haldane, who headed Boris Johnson’s upgrade task force for six months between leaving the Bank and joining RSA this spring, said there were “more than equal chances “that the British economy falls into recession.

“We could find ourselves heading south rather than north,” he added.

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Banks weighing the central database of fraud attempts https://pivdencombank.com/banks-weighing-the-central-database-of-fraud-attempts/ Mon, 09 May 2022 18:24:00 +0000 https://pivdencombank.com/banks-weighing-the-central-database-of-fraud-attempts/ Banks seek to set up a pool of borrowers who have attempted to defraud. The database may also contain details of customers who hid information or manipulated their books in order to obtain loans from different lenders.

A senior bank official said such a database will be on the lines of the Central Fraud Registry (CFR) set up by the Reserve Bank and will have the participation of public and private banks. “Preliminary discussions have taken place, we still have to finalize the structure,” he said.

According to the existing standards, banks are not required to report attempted fraud cases to the RBI, but they must file the report on individual cases of attempted fraud involving amount of ₹1 crore and above before the reporting committee. audit of their board of directors.

The CFR, an online and searchable database, is set up by the regulator based on fraud monitoring reports, filed by selected banks and financial institutions.

The RBI has advised banks to put in place appropriate systems and procedures to ensure that the information available through the database is used for credit risk governance and fraud risk management.

Another executive familiar with the developments said corporate and retail borrowers can be part of this new database.

Experts believe that such a database will help real borrowers and banks in the long run. “This will discourage borrowers who would now know that seeking credit through unscrupulous means can prevent their access to all banks and financial institutions,” said Hitesh Pandey, managing director of Synemerge Solutions, an advisory firm.

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US unveils additional sanctions targeting Russian media, funding and elites https://pivdencombank.com/us-unveils-additional-sanctions-targeting-russian-media-funding-and-elites/ Sun, 08 May 2022 16:42:56 +0000 https://pivdencombank.com/us-unveils-additional-sanctions-targeting-russian-media-funding-and-elites/

The United States, the European Union and the Group of Seven countries will impose additional sanctions on Russia targeting the country’s media, elites and state-controlled services that help finance the war in Ukraine, said a senior Biden administration official on Sunday.

The announcement came as Biden virtually met with G-7 leaders and Ukrainian President Volodymyr Zelenskyy to reinforce their shared commitment to strengthening the war-torn country’s position on the battlefield and at the negotiating table.

The United States will sanction three of Russia’s most-watched state-controlled TV channels – Joint Stock Company Channel One Russia, Television Station Russia-1 and Joint Stock Company NTV Broadcasting Company, the official said, adding that the stations have been among the biggest recipients of foreign income, which fuels the Russian state.

The administration will also bar US individuals from providing accounting, trust, and business formation or management consulting services to anyone in the Russian Federation in an effort to limit key services to Moscow’s businesses and elites whose wealth generates revenue for Russia and who are trying to hide that money and evade sanctions, the official said.

The action builds on previous restrictions on the export of goods in the aerospace, marine, electronics, technology and defense sectors.

In addition, the United States will further restrict Russian exports by sanctioning Promtekhnologiya, a company that produces guns and other weapons used in military operations in Ukraine, as well as seven shipping companies and a marine towing company, the official said. responsible. The Nuclear Regulatory Commission will also suspend export licenses for certain nuclear materials to Russia.

The United States will issue a new rule to impose additional sanctions on Russia’s industrial sector, including a wide range of raw materials and equipment, such as wood products, industrial engines and motors, to limit the the country’s access to these items as well as the revenue that could support its military capabilities, the official continued.

The G-7, which includes the United States, Britain, France, Germany, Italy, Japan and Canada, has also pledged to phase out or ban Russian oil imports. and pledged to work alongside the United States to ensure a stable global energy supply, the official said. mentioned. The Biden administration banned Russian energy imports in early March.

Finally, the United States imposed new visa restrictions on Russian military officials and Moscow-backed authorities allegedly implicated in human rights abuses, violations of international humanitarian law or public corruption in Ukraine, the manager said.

The administration also sanctioned executives of Sberbank, Russia’s largest financial institution, as well as Gazprombank, which facilitates the business of Russia’s Gazprom, one of the world’s largest natural gas exporters, and Moscow Industrial. Bank and its subsidiaries.

Other G-7 leaders have also pledged to take further action against Russian state media, banks and elites, and will act to prevent the provision of key services to Moscow, according to a joint statement shared by the White House.

Sanctions against Russia previously imposed by the United States and its allies and partners have already weighed heavily on the country’s economy, access to technology and supply chains, the official said, adding that this news measures “will increase these costs”.

The virtual meeting of the world’s major economies came as Biden urges Congress to provide an additional $33 billion in military and humanitarian aid to Ukraine in anticipation of the fighting, which began Feb. 24 when Russia launched an invasion, will continue for months.

During their call, which lasted about 70 minutes, the G-7 leaders assured Zelenskyy that they were ready to take further steps to help Ukraine “secure its free and democratic future”, according to the report. communicated.

Zelenskyy reiterated his goal of ensuring a full withdrawal of Russian forces and equipment from Ukraine as well as security guarantees to prevent future attacks, the G-7 leaders said, adding that Kyiv and international partners began discussions on ways to ensure a post-war peace settlement.

“In the coming weeks, we will step up our collective short-term financial support to help Ukraine fill funding gaps and provide basic services to its people, while developing options – together with the Ukrainian authorities. and international financial institutions – to support long-term recovery and reconstruction,” they added.

White House press secretary Jen Psaki underscored the importance of the timing of the G-7 meeting on Friday, saying Russian President Vladimir Putin had “projected his desire” to use the Day of Justice celebrations. Victory for his country on Monday to declare Ukraine’s defeat. The G-7 leaders, in turn, said in their statement that they held the meeting on VE Day, marking the anniversary of Germany’s surrender in World War II, in a show of unity for Ukraine.

In a late-night video on Saturday, Zelenskyy warned that Russia would likely step up its attacks over the weekend into Monday.

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This Billion Dollar Crypto Loan Is Easy To Obtain, But Disappears In A Flash https://pivdencombank.com/this-billion-dollar-crypto-loan-is-easy-to-obtain-but-disappears-in-a-flash/ Sun, 08 May 2022 11:00:00 +0000 https://pivdencombank.com/this-billion-dollar-crypto-loan-is-easy-to-obtain-but-disappears-in-a-flash/ A hacker who stole the decentralized stablecoin platform Beanstalk in April had a powerful tool at his disposal: a billion-dollar loan taken out with no collateral, no proof of income and no identity verification. The loan had to be repaid in less than a second, but that was all it took to steal tens of millions of dollars.

The hacker used what is called a flash loan, a cheap, instant and anonymous form of financing based on cryptocurrencies.

These flash loans have beneficial uses, including helping traders trying to capitalize on price differences between cryptocurrencies on different exchanges. In that sense, they are very similar to the funding that an investment bank might provide to an investment fund to make bets on different stocks or currencies.

The WSJ’s Dion Rabouin looks at the future of cryptocurrencies. Photo composition: Elizabeth Smelov

But flash loans also have a dark side. There have been a series of recent thefts using flash loans. In addition to the Beanstalk theft revealed last month, a decentralized finance platform called Rari Capital said a hacker used a flash loan to help steal around $80 million from it. And Cream Finance said in October that a hacker used a flash loan to help steal around $130 million from its platform.

Decentralized finance, or DeFi, is a growing area of ​​the cryptocurrency world that provides funding and liquidity to people who trade in its markets. In a sense, flash loans are similar to funding that banks might provide to algorithmic traders who enter and exit positions in milliseconds.

A DeFi platform, such as Aave or Uniswap, is software that allows users to build and support applications. Users of different apps and services deposit cryptocurrency into accounts within each service. The combined assets on a platform are the pools from which flash loans are made.

Services such as borrowing and lending are handled by “smart contracts”, pieces of code that are written to automate an agreement. These replace a loan application or bank application that would be used in traditional finance.

Flash loans are not a retail tool, however. To use a flash loan, someone must be able to code a contract and execute it. The flash loan part of the Beanstalk hack, for example, involved nearly two dozen steps.

“There is so much more profit in harmful uses.”


— Hassan Bassiri, fund manager, Arca

What puts the flash in a flash loan is the repayment period: It is almost immediate. A flash loan is both granted and repaid within the same transaction. The loan life cycle is about as long as it takes a computer to process a transaction.

It’s not a lot of time. But in an automated world, all you have to do is make a trade.

The smart contract contains written terms that guarantee repayment. If the borrower does not repay the loan, the contract cancels the transaction before it is confirmed, as well as any market maneuver to which it was linked. It is as if the loan never took place and is therefore an all or nothing proposition. For this reason, there is virtually no credit risk for lenders.

And since there is no credit risk, the amounts that can be borrowed are only limited by the amount of capital held on a specific DeFi platform. Aave, for example, has approximately $21 billion in liquidity across its services, held in a variety of cryptocurrencies.

In theory, flash loans allow people to use borrowed funds much as financiers do in traditional markets, like an activist investor would use the funding to acquire a business, or the way George Soros used borrowed money to bet against the pound sterling.

But their speed, the absence of guarantees required and the anonymity allowed make them very different in practice. “They open up the potential for things you couldn’t even do in traditional markets and weren’t possible in crypto before,” said Max Galka, founder and CEO of crypto analytics firm Elementus.

There are several DeFi platforms that allow flash loans, but Aave, where the loans come from, is the biggest. Since 2020, Aave has processed 52,000 flash loans totaling $15.6 billion in market value, according to Elementus. Borrowers pay a small fee for the loan.

This is small compared to the total value of the crypto market of $1.8 trillion. But even a few hundred million can be enough to manipulate or attack some of the smaller and less liquid assets in the crypto market.

For coders who understand how to use flash loans, the potential for malpractice is enormous, said Hassan Bassiri, fund manager at Arca, a crypto-focused investment manager. Because DeFi is such a new field, many services have poor security or poorly written code, or both, making the potential for abuse even greater.

“You’re not going to make $80 million in 30 seconds of work doing arbitrage,” Bassiri said. “There is so much more profit in harmful uses.”

The Beanstalk incident is an example of a hacker using a flash loan to temporarily take over a crypto project. Beanstalk is a stablecoin platform, which means that each token is pegged to the US dollar, where the investors are also the owners. Each person who buys a token receives one voting share. Investors can propose and vote to make changes to the platform.

A day before the attack, the hacker offered to send money from Beanstalk to Ukraine as help, although the code was instead directed to a wallet controlled by the hacker.

The Beanstalk hacker borrowed $1 billion in a flash loan from the Aave platform, in several different crypto denominations, which the hacker used to buy Beanstalk and temporarily take control of the voting mechanism. The Beanstalk founders declined to comment. Aave did not respond to a request for comment.

At the time of the attack, the hacker had to do several things quickly with a computer program: take out the flash loan, buy enough tokens to give the person a voting majority, and vote to approve the previous day’s proposal. Then the hacker sent the funds to another location and sold the Beanstalk tokens to repay the original loan.

The result: the hacker drained around $76 million worth of cryptocurrency in the blink of an eye.

Write to Paul Vigna at Paul.Vigna@wsj.com

Copyright ©2022 Dow Jones & Company, Inc. All rights reserved. 87990cbe856818d5eddac44c7b1cdeb8

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Rishi Sunak can fight recession risks with cost-of-living support package | Larry Elliot https://pivdencombank.com/rishi-sunak-can-fight-recession-risks-with-cost-of-living-support-package-larry-elliot/ Sun, 08 May 2022 10:36:00 +0000 https://pivdencombank.com/rishi-sunak-can-fight-recession-risks-with-cost-of-living-support-package-larry-elliot/

LLess than three months after Russian troops crossed the Ukrainian border, the economic implications of the war are gradually being felt. There have been other conflicts since 1945, but it is hard to imagine one that had such a dramatic and sudden impact. The only real comparison is with the 1973 Yom Kippur War.

Support for Ukraine is widespread in the West, among governments and the public, but it is only now that the consequences of sanctions and embargoes are beginning to be felt. This week, the US Federal Reserve and the Bank of England raised interest rates in the face of annual inflation rates heading towards 10%. The European Central Bank will follow in the coming months.

The threat of recession is obvious. Central banks say they are powerless to stop rising global energy prices from driving up the cost of living, but believe they can prevent high inflation from taking hold. Former Chancellor of the Exchequer Norman Lamont once said that higher unemployment was a “price to pay” for controlling inflation, and that sentiment still persists.

Last year, central banks assumed that inflationary pressures would be temporary. There would be bottlenecks as demand increased as countries emerged from lockdown and supply struggled to keep up, but any problems would soon disappear. Analogies have been made with the audience leaving a theater at the end of a play: there is a rush at the exit but it doesn’t take long before everyone is out in the street.

In fact, things were a bit more complex than that, with more pent-up demand resulting from the lack of spending opportunities during the coronavirus pandemic than central banks thought and more degraded supply chains. The imbalance between demand and supply has since been exacerbated by two factors – the war in Ukraine and China’s zero-tolerance approach to Covid 19 – but it was already driving up inflation in the second half of 2021.

These global shocks affect countries in different ways. As Bank Governor Andrew Bailey pointed out this week, the United States is facing what looks like a demand shock, with a tight labor market, strong consumer spending and less exposure. to energy prices due to their status as major gas producers. The Eurozone experiences a supply shock because it has a weaker labor market than the United States and is more exposed to rising energy prices. Britain has elements of both: it is experiencing a supply shock from the rising cost of energy and food but, like the United States, it has low unemployment.

The EU must develop a new energy strategy as it weans itself off Russian oil and gas. Photography: Hannibal Hanschke/Getty Images

Everywhere, however, the story is one of higher inflation, slower growth and tough choices for policymakers. Olaf Scholz, the German chancellor, has been criticized for wanting to limit the damage caused to his country’s economy by the war. In truth, it simply asks an obvious question: how much pain can governments impose on their populations before support begins to wane?

This question only becomes more relevant as collateral damage increases. For now, the impact of war is being cushioned by the opening up of economies as the Omicron variant of Covid 19 becomes less of a threat. Unemployment will continue to fall in the US, UK and Eurozone for a few months. Things get complicated later.

The end of the Cold War in the early 1990s allowed Western governments to cut defense spending and reallocate money elsewhere. Fewer tanks and warships meant more could be spent on health and education without taxes having to be raised. If, as seems likely, the Cold War returns, tougher choices will have to be made, and at a time when aging populations intensify pressures for increased spending.

There are other long term implications of the war. The EU must develop a new energy strategy on the hoof as it weans itself off Russian oil and gas. Long global supply chains look less attractive than they did pre-Covid, and self-sufficiency is back in fashion. Both of these factors threaten to push prices higher, at least in the short term.

It is clear that it is not easy to adopt an appropriate policy in these circumstances and that delicate decisions are taken by central banks and ministries of finance. Central banks will suffer a loss of credibility if they allow an inflationary spiral to take hold, but the monetary overpower that pushes their economies deeper into recession won’t do much for their reputation either.

However, the real responsibility lies with finance ministers, because fiscal policy – ​​tax and spending decisions – is more effective in the current circumstances than monetary policy.

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In the UK, Rishi Sunak seems in no rush to add to the limited support he gave in the spring statement, preferring to wait for the autumn budget to act. Pressure for a summer mini-budget is likely to increase, however, as by August a new energy price cap will be announced to take effect in October. That looks like adding an extra £800 a year to the average household’s bill, bringing it to around £2,800. Millions more will fall into fuel poverty.

It is not a question of whether there is more help, but how generous this support is and when it will be deployed. It is unrealistic for governments to imagine that support for Ukraine will continue at its current high levels as queues begin to grow and living standards begin to really erode.

There is a trade-off here: if foreign policy is to remain hawkish toward Russia, then domestic policy must become more dove in helping those most affected by the economic consequences of war.

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CryptoPunk Owner Secures $3.3M NFT Loan on Nexo By BTC Peers https://pivdencombank.com/cryptopunk-owner-secures-3-3m-nft-loan-on-nexo-by-btc-peers/ Sat, 07 May 2022 10:00:00 +0000 https://pivdencombank.com/cryptopunk-owner-secures-3-3m-nft-loan-on-nexo-by-btc-peers/

CryptoPunk owner secures $3.3M NFT loan on Nexo

Much like the era of DeFi lending, NFT-backed lending is increasingly becoming a norm. An anonymous CryptoPunk owner was able to use two of his pixelated avatars as collateral to secure a loan of over $3.3 million.

The said loan was issued by crypto lending platform Nexo at an annual interest rate of 21%. It involved a number of parties, including DeFi and NFT lending platform Arcade and investment manager Meta4Capital. “With this multilateral partnership, we are demonstrating the fusion between traditional, decentralized and crypto finance,” said Nexo’s Head of DeFi Strategy, Kiril Nikolov.

According to Bloomberg, the transaction demonstrates how sophisticated the NFT lending market has become.

The complex deal was structured with Nexo, a centralized crypto lender, issuing the loan on Arcade, a peer-to-peer marketplace for NFT loans.

For the uninitiated, NFT-backed loans are quite similar to traditional loans, with the digital asset being used as collateral. In the case of Nexo, users can get instant liquidity between 10% and 20% of the value of their CryptoPunk or Bored Ape Yacht Club NFT.

Liquidity is usually in stablecoins or ETH and NFTs will not be liquidated even if their value drops after the funds have been borrowed. However, unlike traditional finance where borrowing rates and annualized rates are based on your credit history, rates often range from 12% to 15% in NFT loan markets and depend on the NFT offered, as well as the market conditions.

If a borrower fails to repay the loan and interest at the end of the loan period, the lender may collect the underlying NFT.

Continue Reading on BTC Peers

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TMC the metals (NASDAQ: TMC) and Public Joint Stock Company Mining and Metallurgical Company Norilsk Nickel (OTCMKTS: NILSY) Critical Survey https://pivdencombank.com/tmc-the-metals-nasdaq-tmc-and-public-joint-stock-company-mining-and-metallurgical-company-norilsk-nickel-otcmkts-nilsy-critical-survey/ Sat, 07 May 2022 08:19:44 +0000 https://pivdencombank.com/tmc-the-metals-nasdaq-tmc-and-public-joint-stock-company-mining-and-metallurgical-company-norilsk-nickel-otcmkts-nilsy-critical-survey/

TMC the metals (NASDAQ:TMC – Get Rating) and Public Joint Stock Company Mining and Metallurgical Company Norilsk Nickel (OTCMKTS:NILSY – Get Rating) are both basic materials companies, but which business is superior? We will compare the two companies based on the strength of their analyst recommendations, profitability, valuation, institutional ownership, earnings, dividends and risk.

Benefits and evaluation

This table compares the gross revenue, earnings per share, and valuation of TMC the metals and Public Joint Stock Company Mining and Metallurgical Company Norilsk Nickel.

Gross revenue Price/sales ratio Net revenue Earnings per share Price/earnings ratio
TMC metals N / A N / A -$141.30 million N / A N / A
Public Joint Stock Company Norilsk Nickel Mining and Metallurgical Company $15.55 billion 0.30 $3.39 billion N / A N / A

Public Joint Stock Company Mining and Metallurgical Company Norilsk Nickel has higher revenues and profits than TMC Metals.

Risk and Volatility

TMC the metals has a beta of 1.47, indicating that its stock price is 47% more volatile than the S&P 500. In comparison, Public Joint Stock Company Mining and Metallurgical Company Norilsk Nickel has a beta of 0.99, indicating that its stock price is 1% less volatile than the S&P 500.

Insider and Institutional Ownership

34.0% of the shares of TMC the metals are held by institutional investors. In comparison, 0.1% of the shares of the public joint-stock company of mining and metallurgical company Norilsk Nickel are held by institutional investors. 30.2% of the shares of TMC the metals are held by insiders of the company. Strong institutional ownership indicates that large fund managers, endowments, and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares the net margins, return on equity and return on assets of TMC the metals and Public Joint Stock Company Mining and Metallurgical Company Norilsk Nickel.

Net margins Return on equity return on assets
TMC metals N / A -151.33% -18.72%
Public Joint Stock Company Norilsk Nickel Mining and Metallurgical Company N / A N / A N / A

Analyst Recommendations

This is a summary of recent ratings and price targets for TMC the metals and Public Joint Stock Company Mining and Metallurgical Company Norilsk Nickel, as provided by MarketBeat.

Sales Ratings Hold odds Buy reviews Strong buy odds Rating
TMC metals 0 3 0 0 2.00
Public Joint Stock Company Norilsk Nickel Mining and Metallurgical Company 1 3 1 0 2.00

TMC Metals currently has a consensus price target of $3.75, indicating a potential upside of 155.10%. Public Joint Stock Mining and Metallurgical Company Norilsk Nickel has a consensus price target of $33.00, indicating a potential upside of 992.72%. Given the possible higher upside of the mining and metallurgical joint stock company Norilsk Nickel, analysts clearly believe that the mining and metallurgical joint stock company Norilsk Nickel is more favorable than TMC for metals.

Summary

Public Joint Stock Mining and Metallurgical Company Norilsk Nickel beats TMC metals on 6 out of 9 factors compared between the two stocks.

About TMC Metals (Get a rating)

TMC the metals company Inc. is committed to the exploration of battery grade metals. It mainly explores nickel sulfate, cobalt sulfate, copper and manganese products. The Company, through its subsidiaries, holds exploration rights to three polymetallic nodule contract areas in the Clarion Clipperton area of ​​the Pacific Ocean. TMC the metals company Inc. was founded in 2021 and is based in Vancouver, Canada.

About the public joint-stock company Norilsk Nickel Mining and Metallurgical Company (Get a rating)

Public Joint Stock Company Mining and Metallurgical Company Norilsk Nickel logoPublic Joint Stock Company Mining and Metallurgical Company Norilsk Nickel, together with its subsidiaries, operates as a metallurgical and mining company in Europe, Asia, North and South America, Russia and the CIS countries. The Company operates through GMK Group, South Cluster, KGMK Group, NN Harjavalta, GRK Bystrinskoye, Other Mining and Other Non-Metallurgical segments. It explores, extracts and refines ore and non-metallic minerals; and the sale of base and precious metals produced from ore. The Company’s products include nickel, palladium, copper, platinum, cobalt, rhodium, iridium, ruthenium, silver, gold, selenium, tellurium, sulfur, sulphate sodium and sodium chloride. It is also involved in the leasing of goods and equipment, gas extraction and transportation, power generation and distribution, ore extraction and processing, construction, mining and metallurgical repairs, production of spare parts, geological works and constructions, distribution, research, fuel supply, river navigation. , and airport companies, as well as acts as an airline. Public Joint Stock Company Mining and Metallurgical Company Norilsk Nickel was incorporated in 1997 and is based in Moscow, Russia.



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Wells Fargo wins commercial loan lawsuit dismissal https://pivdencombank.com/wells-fargo-wins-commercial-loan-lawsuit-dismissal/ Sat, 07 May 2022 00:14:00 +0000 https://pivdencombank.com/wells-fargo-wins-commercial-loan-lawsuit-dismissal/

May 6 (Reuters) – A federal judge on Friday dismissed class action lawsuits alleging Wells Fargo & Co (WFC.N), the fourth-largest U.S. bank, deceived or defrauded shareholders over its business loans.

U.S. District Judge William Alsup in San Francisco said shareholders failed to sufficiently allege that Wells Fargo unjustifiably inflated the quality of its loans, understated loss reserves or misrepresented its lending practices.

Shareholders claimed they lost billions of dollars in Wells Fargo stock as the San Francisco-based bank gradually revealed in 2020 the “previously unknown level of risk” in its commercial loans.

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The proposed class covers shareholders in the three years ending October 13, 2020, a period when Wells Fargo stock price fell 54%.

But the judge found that Wells Fargo had underwriting standards that “have been found to be broadly accurate or conservative, and not inflationary”, and have not misled shareholders about the amount of loans relative to the companies’ value. borrowers.

Because he found no false or misleading statements, Alsup did not say whether Wells Fargo intended to defraud anyone.

He said the shareholders, led by the Hawaii State Employees Retirement System, could file an amended lawsuit to address the shortcomings in their case.

Attorneys for the shareholders did not immediately respond to requests for comment. Wells Fargo and its attorneys did not immediately respond to similar requests.

Since 2018, Wells Fargo has operated under consent orders from the Federal Reserve and two other U.S. financial regulators to improve governance and oversight. The Fed also capped the bank’s assets at $1.95 trillion.

The bank has faced widespread criticism over its practices since 2016, including for opening accounts without customer permission and charging borrowers for car insurance they didn’t need.

The case is Hawaii State Employees Retirement System v. Wells Fargo & Co, US District Court, Northern District of California, No. 20-07674.

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Reporting by Jonathan Stempel in New York; Editing by David Gregorio

Our standards: The Thomson Reuters Trust Principles.

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Pension industry fears Russia-Ukraine conflict https://pivdencombank.com/pension-industry-fears-russia-ukraine-conflict/ Fri, 06 May 2022 09:48:30 +0000 https://pivdencombank.com/pension-industry-fears-russia-ukraine-conflict/

Soaring oil prices and the outbreak of the Russian-Ukrainian conflict have contributed to the uncertainty facing financial markets. This could potentially have negative implications for the Namibian pension fund industry’s investment assets.

The sector’s investment assets weathered threats stemming from Covid-19, higher than expected inflation rates and relatively tighter central bank policies during the review period.

According to the April 2022 Financial Stability Report released by the Bank of Namibia last week, investment returns were recorded at 15.6% in 2021, rising from 6.7% and 5.8% in 2020 and 2019, respectively.

“Strong performance was seen in particular in the first and fourth quarters of 2021. The performance in the first quarter of 2021 was due to the deployment of the Covid-19 vaccine as well as a relatively large stimulus from the US government,” reads the article. The report.

Additionally, financial markets weathered the threat of the Omicron variant Covid-19 as well as the prospect of tighter central bank policies to end the fourth quarter of 2021 positively.

The sector remained operationally resilient throughout 2021, despite the effects of interest rate hikes in various jurisdictions, among others. During the period under review, the assets of the pension fund sub-sector increased by 17.9% to reach N$212.9 billion at the end of December 2021 due to the favorable performance of the financial markets. In terms of investment mix, the pension fund industry held at least 45.7% of its assets in equities during the reporting period. Bonds and insurance policies made up the rest of the subsector’s top three investment vehicles.

“The reduction in equity exposure over time has coincided with revisions to the investment regulations governing these funds. Chief among the revisions was the phased increase in the minimum domestic holding requirement from 35% in 2014 to 45%, effective March 2019.

Inherently, shocks in the financial markets will channel the most severe distress to the investment assets of the subsector, given the composition of the industry’s investments. The Financial Institutions Supervisory Authority of Namibia (Namfisa) therefore monitors developments in financial markets in relation to inflation and geopolitics,” the report adds.

Regarding the geographical distribution of funds, the exposure of the pension fund sub-sector to the domestic economy increased during 2021.

The industry’s national exposure increased from 45.6% in December 2020 to 49.4% in December 2021. He noted that the proportional growth in national assets is attributable to national holding requirements mandated by legislation. Pension fund investment assets held in the domestic economy amounted to N$104.6 billion as of December 2021, including N$107.0 billion held outside Namibia during the same period reference.