Form 8-K - Current report

0001849670false00018496702024-07-242024-07-24

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(D) OF

THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported):  July 24, 2024

PB Bankshares, Inc.

(Exact Name of Registrant as Specified in Charter)

Maryland		001-40612		86-3947794
(State or Other Jurisdiction of Incorporation)		(Commission File No.)		(I.R.S. Employer Identification No.)

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185 East Lincoln Highway, Coatesville, Pennsylvania		19320
(Address of Principal Executive Offices)		(Zip Code)

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Registrant’s telephone number, including area code:[phone]

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

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Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, par value $0.01		PBBK		The Nasdaq Stock Market LLC

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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

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Emerging growth company ☒

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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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Item 2.02

Results of Operations and Financial Condition

On July 24, 2024, PB Bankshares, Inc. (the “Company”) issued a press release reporting its financial results at and for the three and six months ended June 30, 2024.

A copy of the press release is attached as Exhibit 99.1 to this report and is being furnished to the Securities and Exchange Commission and shall not be deemed filed for any purpose.

Item 9.01

Financial Statements and Exhibits

(a)		Financial statements of businesses acquired. None.
(b)		Pro forma financial information. None.
(c)		Shell company transactions: None.
(d)		Exhibits.
		99.1		Press release dated July 24, 2024
		104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

​	PB BANKSHARES, INC.
​	​
DATE: July 24, 2024	By:	/s/ Lindsay Bixler
​	​	Lindsay Bixler
​	​	Executive Vice President and Chief Financial Officer

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Exhibit 99.1

FOR IMMEDIATE RELEASE

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Contact:
Lindsay S. Bixler
Executive Vice President and Chief Financial Officer

[phone]

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PB BANKSHARES, INC. ANNOUNCES 2024 SECOND QUARTER FINANCIAL RESULTS

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Coatesville, Pennsylvania, July 24, 2024 — PB Bankshares, Inc. (the “Company”) (NASDAQ: PBBK), the holding company for Presence Bank (the “Bank”), reported unaudited net income of $370,000 for the three months ended June 30, 2024 and $687,000 for the six months ended June 30, 2024 compared to $588,000 and $997,000, respectively, for the same periods in 2023. Diluted earnings per share were $0.16 for the second quarter of 2024 and $0.29 for the first six months of 2024 compared to $0.23 and $0.39, respectively, for the same periods in 2023.

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Year to Date 2024 Highlights:

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Total interest and dividend income grew by 22.6% to $11.5 million for the six months ended June 30, 2024 from $9.4 million for the six months ended June 30, 2023.

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Noninterest expense remained flat, increasing by 0.5% to $4,985,000 for the six months ended June 30, 2024 from $4,958,000 for the six months ended June 30, 2023.

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Allowance for credit losses remained strong at 1.30% of loans outstanding at June 30, 2024 compared to 1.38% of loans outstanding at December 31, 2023.

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Annualized growth rate on gross loans was 11.4% at June 30, 2024 from December 31, 2023.

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Accumulated other comprehensive loss decreased by 13.4% to $1,080,000 at June 30, 2024 compared to $1,247,000 at December 31, 2023, accounting for 2.3% of total stockholders’ equity at June 30, 2024.

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The remaining weighted average life of our debt securities available-for-sale portfolio remained short at 1.24 years at June 30, 2024.

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Tangible book value per common share excluding accumulated other comprehensive loss increased by $0.59 to $18.59 at June 30, 2024 from $18.00 at December 31, 2023*.

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The Company repurchased 115,827 shares of its common stock during the first six months of 2024, at an average price of $13.06 per share.

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* Refer to the appendix of Financial Highlights (Unaudited) for the Non-GAAP Financial Measure Reconciliation

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Exhibit 99.1

Income Statement

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Net interest income was $2.8 million for the three months ended June 30, 2024 and $5.4 million for the six months ended June 30, 2024 compared to $3.2 million and $6.3 million, respectively, for the same periods in 2023. The decrease for the three and six months ended June 30, 2024 compared to the same periods in 2023 was primarily due to increases in interest expense on deposits and borrowings, partially offset by increases in interest income on loans, securities and cash and federal funds sold. The increases in both interest income and interest expense were as a result of the high interest rate environment and increases in average interest earning assets and average interest bearing liabilities.

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The Company recorded a provision for credit losses of $17,000 for the three months ended June 30, 2024 and a reversal of provision for credit losses of $67,000 for the six months ended June 30, 2024 compared to a provision for credit losses of $247,000 and $430,000, respectively, for the same periods in 2023. The decrease in provision for credit losses for both the three and six months ended June 30, 2024 was primarily due to lower qualitative factor allocations within the Company’s current expected credit losses methodology and a lower required allowance for unfunded commitments due to a decline in volume of unfunded commitments. There were no loan charge-offs during the first six months of 2024 and only $6,000 of overdraft protection charge-offs. Delinquencies remain benign, reserves are deemed to be adequate as of June 30, 2024 and the allowance coverage ratio has remained strong. The allowance for credit losses was $4.5 million, or 1.30%, of loans outstanding at June 30, 2024 as compared to $4.5 million, or 1.38%, of loans outstanding at December 31, 2023. Total non-performing loans decreased to $1.3 million at June 30, 2024 compared to $1.4 million at December 31, 2023. The non-performing loans to total loans ratio decreased by seven basis points to 0.37% at June 30, 2024 from 0.44% as of December 31, 2023.

Noninterest income was $190,000 for the three months ended June 30, 2024 and $377,000 for the six months ended June 30, 2024 compared to $259,000 and $397,000, respectively, for the same periods in 2023. The primary reason for the decrease in noninterest income for the three and six months ended June 30, 2024 as compared to the same prior year periods was due to a decrease in other income. The other income decrease was due to $14,000 and $24,000 of loan related fee income for the three and six months ended June 30, 2024, respectively, as compared to $58,000 for the same periods in 2023, earned for brokering interest rate swap agreements between the Bank’s customers and counterparties unrelated to the Bank.

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Noninterest expense was $2,487,000 for the three months ended June 30, 2024 and $4,985,000 for the six months ended June 30, 2024 compared to $2,493,000 and $4,958,000, respectively, for the same periods in 2023. The decrease for the three months ended June 30, 2024 was primarily due to decreases in advertising and marketing of $34,000 primarily due to timing of community sponsorships. The increase for the six months ended June 30, 2024 was primarily due to increases in data and item processing as the Company continues to invest in our information technology infrastructure.

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Exhibit 99.1

Balance Sheet

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Total assets increased $9.3 million or 2.1% to $449.0 million at June 30, 2024 from $439.7 million at December 31, 2023. The increase in assets was primarily due to increases in cash and cash equivalents and net loans receivable, partially offset by a decrease in debt securities available-for-sale. Cash and cash equivalents increased 68.7% to $54.7 million at June 30, 2024 from $32.4 million at December 31, 2023 as a result of strong deposit growth and maturity of treasury securities during the first half of 2024. Gross loans increased $18.5 million or 5.7% to $345.1 million at June 30, 2024 from $326.6 million at December 31, 2023, primarily as a result of the increase in the commercial real estate portfolio as the Bank continues its focus on commercial lending. Management is monitoring the commercial real estate portfolio and concentrations, assessing their associated risks. As part of its risk management process, the Bank segments and stress tests its non-owner occupied commercial real estate portfolio. Approximately 84.7% or $121.1 million of this portfolio was subject to stress testing (loans having exposure under $500,000 and one- to four family investor properties are not subject to stress testing). The commercial real estate portfolio has an average Loan-to-Value ratio of 59.8% and a Debt Service Coverage ratio of 1.47 times, exclusive of any sponsor or guarantor support at June 30, 2024. The commercial real estate portfolio is diverse with respect to both property type as well as location with limited concentrations. Two segments, Office Space and Hospitality, are the subject of market scrutiny with these segments’ exposure and selected credit metrics outlined below.

The Bank has reviewed its loan portfolio for exposure to office space given the uncertainty and potential risks associated with vacancy, future demand, and repricing risk for these assets. The Bank’s exposure to this segment is minimal with only $9.3 million in non-owner-occupied office space at June 30, 2024. Notably the five loans comprising the office segment are all medical related, which the Company believes has not suffered the decline in value that the general office market has experienced. The office space loan portfolio has an average Loan-to-Value ratio of 71.9% and Debt Service Coverage ratio of 1.50 times, exclusive of any sponsor or guarantor support at June 30, 2024.

The Bank’s hospitality portfolio is also an area of market focus. Loan exposure to this segment totaled $20.5 million (six hotel properties) at June 30, 2024. The average Loan-to-Value ratio was low at 51.2% with a strong Debt Service Coverage ratio of 2.04 times, exclusive of any sponsor or guarantor support at June 30, 2024. Guarantor support for the hospitality sector is strong and loans are supported by experienced hotel operators.

Debt securities available-for-sale decreased $32.0 million or 47.0% to $36.1 million at June 30, 2024 as a result of short-term treasury securities purchased during the fourth quarter of 2023 maturing in the first half of 2024 and the proceeds of which have remained in cash and cash equivalents as of June 30, 2024. The remaining weighted average life of our debt securities available-for-sale portfolio was 1.24 years at June 30, 2024.

We experienced strong deposit growth of $14.0 million or 4.2% to $347.0 million at June 30, 2024 from $333.0 million at December 31, 2023 as a result of organic core deposit gathering strategies with the growth being from local businesses and individuals. Uninsured and uncollateralized deposits totaled approximately $37.9 million or 10.9% of the Bank’s total deposits, as of June 30, 2024. The Company maintains highly liquid sources of available funds in addition to cash and

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Exhibit 99.1

cash equivalents, including unused borrowing capacity with the Federal Home Loan Bank of Pittsburgh and the Federal Reserve Bank of Philadelphia and available federal funds lines with other banks, as well as unpledged available-for-sale debt securities. At June 30, 2024, available funding from these sources totaled 578.2% of uninsured and uncollateralized deposits. Stockholders’ equity decreased $389,000 to $46.6 million at June 30, 2024 from $47.0 million at December 31, 2023 as a result of stock buybacks of 115,827 shares for $1.5 million during the first six months of 2024, partially offset by year to date net income of $687,000. The Company’s accumulated other comprehensive loss resulting from the unrealized losses on debt securities available-for-sale was 2.3% of total stockholders’ equity at June 30, 2024, which is low compared to the banking industry. The Bank’s stand-alone stockholders’ equity increased $1.1 million to $40.0 million at June 30, 2024 from $38.9 million at December 31, 2023 primarily as a result of year to date net income for the Bank.

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Forward-Looking Statements

Certain statements contained herein constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.  Such statements may be identified by words such as “may,” “will,” “would,” “intend,” “believe,” “expect,” “plan,” “estimate,” “anticipate,” “continue,” or similar terms or variations on those terms, or the negative of those terms.

These forward-looking statements are based on current beliefs and expectations of the Company’s and the Bank’s management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond the Company’s and the Bank’s control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. Actual results may differ materially from those set forth in the forward-looking statements as a result of numerous factors.  Factors that could cause such differences to exist include, but are not limited to: risks related to the real estate and economic environment, particularly in the market areas in which the Company and the Bank operate; fiscal and monetary policies of the U.S. Government; inflation; changes in government regulations affecting financial institutions, including regulatory compliance costs; geopolitical instability and capital requirements; fluctuations in the adequacy of the allowance for credit losses; decreases in deposit levels necessitating increased borrowing to fund loans and investments; operational risks including, but not limited to, cybersecurity, fraud and natural disasters; the risk that the Company may not be successful in the implementation of its business strategy; changes in prevailing interest rates; credit risk management; asset-liability management; and other risks described in the Company’s filings with the Securities and Exchange Commission, which are available at the SEC’s website, www.sec.gov.

The Company and the Bank caution not to place undue reliance on any such forward-looking statements, which speak only as of the date made. The Company disclaims any obligation to publicly release any revision made to any forward-looking statement to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.

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Exhibit 99.1

About PB Bankshares, Inc. and Presence Bank

PB Bankshares, Inc. is the holding company for Presence Bank. Presence Bank was founded in 1919 and currently operates four banking offices and two loan production offices in Chester, Lancaster and Dauphin Counties, Pennsylvania.

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Exhibit 99.1

PB Bankshares, Inc.

Financial Highlights (Unaudited)

(Dollars in thousands, except per share data)

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Earnings Summary (for the three months ended)

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June 30,

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March 31,

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December 31,

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September 30,

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June 30,

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2024

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2024

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2023

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2023

2023

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Interest and dividend income

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$

5,931

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$

5,614

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$

5,277

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$

5,139

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$

5,047

Interest expense

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3,145

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2,982

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2,471

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2,098

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1,825

Net interest income

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2,786

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2,632

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2,806

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3,041

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3,222

Provision for credit losses

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17

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(84)

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62

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140

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247

Noninterest income

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190

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187

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203

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185

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259

Noninterest expense

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2,487

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2,498

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2,413

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2,432

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2,493

Income before income taxes

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472

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405

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534

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654

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​

741

Income taxes

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102

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88

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125

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141

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153

Net income

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370

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317

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​

409

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513

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588

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Earnings per common share - basic

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$

0.16

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$

0.13

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$

0.17

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$

0.21

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$

0.24

Earnings per common share - diluted

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$

0.16

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$

0.13

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$

0.17

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$

0.21

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$

0.23

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Earnings Summary (for the six months ended)	​	​	​	​	​	​	​
​	​	June 30,		​	June 30,		​
​		2024		​	2023
​		​	​	​	​	​
Interest and dividend income	​	$	11,545	​	$	9,416	​
Interest expense	​		6,127	​		3,149	​
Net interest income	​		5,418	​		6,267	​
Provision for credit losses	​		(67)	​		430	​
Noninterest income	​		377	​		397	​
Noninterest expense	​	​	4,985	​	​	4,958	​
Income before income taxes	​	​	877	​	​	1,276	​
Income taxes	​	​	190	​	​	279	​
Net income	​	​	687	​	​	997	​
​	​		​	​		​	​
Earnings per common share - basic	​	$	0.29	​	$	0.40	​
Earnings per common share - diluted	​	$	0.29	​	$	0.39	​

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Exhibit 99.1

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Balance Sheet Highlights (as of)

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June 30,

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March 31,

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December 31,

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September 30,

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June 30,

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2024

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2024

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2023

2023

2023

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Total assets

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$

449,045

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$

450,434

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$

439,748

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$

409,212

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$

412,573

Cash and cash equivalents

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54,731

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66,787

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32,438

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25,185

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42,501

Debt securities available-for-sale, at fair value

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36,068

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32,138

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68,115

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40,667

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34,828

Loans receivable, net of allowance for credit losses

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339,999

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333,288

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321,382

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325,350

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317,306

Deposits

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346,960

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348,389

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332,966

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306,521

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312,091

Total stockholders’ equity

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46,600

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46,769

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46,989

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46,582

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46,177

Accumulated other comprehensive loss

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(1,080)

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(1,250)

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(1,247)

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(1,771)

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(1,770)

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Performance Ratios (as of and for the three months ended)																​
​	​	June 30,		​	March 31,		​	December 31,		​	September 30,		​	June 30,		​
​		2024		​	2024		​	2023			2023			2023
​		​	​	​	​	​	​	​
Return on average assets (annualized)	​	​	0.33	%	​	0.29	%	​	0.38	%	​	0.49	%	​	0.58	%
Return on average equity (annualized)	​	​	2.80	%	​	2.71	%	​	3.14	%	​	4.00	%	​	4.67	%
Net interest margin (annualized)	​	​	2.54	%	​	2.44	%	​	2.74	%	​	3.00	%	​	3.29	%
Allowance to non-accrual loans	​	​	353.77	%	​	334.21	%	​	317.45	%	​	548.89	%	​	507.53	%
Allowance to total loans outstanding at the end of the period	​	​	1.30	%	​	1.32	%	​	1.38	%	​	1.35	%	​	1.34	%
Net charge-offs to average loans outstanding during the period (annualized)	​		—	%		—	%		—	%		—	%		0.09	%
Total non-performing loans to total loans	​		0.37	%		0.39	%		0.44	%		0.25	%		0.26	%
Total non-accrual loans to total loans	​		0.37	%		0.39	%		0.44	%		0.25	%		0.26	%
Total non-performing assets to total assets	​		0.28	%		0.30	%		0.32	%		0.20	%		0.21	%
Tier 1 capital (to average assets)	​	​	9.20	%	​	9.25	%	​	9.78	%	​	9.74	%	​	9.84	%
Book value per common share	​	$	18.17	​	$	17.78	​	$	17.53	​	$	16.97	​	$	16.71	​
Tangible book value per common share*	​	$	18.17	​	$	17.78	​	$	17.53	​	$	16.97	​	$	16.71	​
Tangible book value per common share (excluding accumulated other comprehensive loss)*	​	$	18.59	​	$	18.26	​	$	18.00	​	$	17.62	​	$	17.35	​

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Exhibit 99.1

*Non-GAAP Financial Measure Reconciliation

The following table reconciles, as of the dates set forth below, stockholders’ equity (on a GAAP basis) to tangible book value and tangible book value excluding accumulated other comprehensive loss and calculates our tangible book value per common share and tangible book value per common share excluding accumulated other comprehensive loss. Book value is equal to tangible book value due to the Company having no intangible assets.

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​	​	June 30,		​	March 31,		​	December 31,		​	September 30,		​	June 30,		​
​		2024		​	2024		​	2023			2023			2023
​		​	​	​	​	​	​	​
Tangible common equity	​	$	46,600	​	$	46,769	​	$	46,989	​	$	46,582	​	$	46,177	​
Adjustment for accumulated other comprehensive loss	​	$	(1,080)	​	$	(1,250)	​	$	(1,247)	​	$	(1,771)	​	$	(1,770)	​
Tangible common equity excluding accumulated other comprehensive loss	​	$	47,680	​	$	48,019	​	$	48,236	​	$	48,353	​	$	47,947	​
Common shares outstanding	​	​	2,564,140	​	​	2,629,967	​	​	2,679,967	​	​	2,744,967	​	​	2,763,122	​
Tangible book value per common share	​	$	18.17	​	$	17.78	​	$	17.53	​	$	16.97	​	$	16.71	​
Tangible book value per common share excluding accumulated other comprehensive loss	​	$	18.59	​	$	18.26	​	$	18.00	​	$	17.62	​	$	17.35	​

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Document and Entity Information	Jul. 24, 2024
Document and Entity Information [Abstract]
Document Type	8-K
Document Period End Date	Jul. 24, 2024
Entity Registrant Name	PB Bankshares, Inc.
Entity Incorporation, State or Country Code	MD
Entity File Number	001-40612
Entity Tax Identification Number	86-3947794
Entity Address, Address Line One	185 East Lincoln Highway
Entity Address, City or Town	Coatesville
Entity Address State Or Province	PA
Entity Address, Postal Zip Code	19320
City Area Code	610
Local Phone Number	384-8282
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, par value $0.01
Trading Symbol	PBBK
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Central Index Key	0001849670
Amendment Flag	false

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