Provident Bancorp Reports $7.3 Million Net Income, 33.8% Decrease for Fiscal Year 2024

Provident Bancorp, Inc. reported a net income of $7.3 million for the fiscal year ending December 31, 2024, a decrease of 33.8% from the previous year's net income of $10.9 million. The company's total assets decreased by 4.6% to $1.59 billion, down from $1.67 billion in 2023. This decline was primarily attributed to reductions in cash and cash equivalents, as well as net loans, which fell to $1.31 billion from $1.32 billion. The decrease in net interest and dividend income, which totaled $50.5 million for 2024, was a significant factor in the reduced profitability, reflecting a $7.7 million drop compared to the prior year.

In terms of operational changes, Provident Bancorp has shifted its focus towards traditional commercial real estate and in-market commercial lending, while significantly reducing its exposure to enterprise value lending and ceasing its digital asset loan portfolio. The company’s commercial real estate loans increased by 19.3% to $559.3 million, representing 42.16% of the total loan portfolio. Conversely, enterprise value loans decreased by 28.6% to $309.8 million, and construction and land development loans saw a substantial decline of 63.9% to $28.1 million.

The company also experienced a notable change in its deposit structure, with total deposits decreasing by 1.7% to $1.31 billion. This decline was primarily driven by a significant reduction in brokered deposits and deposits obtained through listing services, which fell by 23.2% and 65.2%, respectively. However, retail deposits increased by 11.2%, indicating a shift in the company's deposit strategy. As of December 31, 2024, the company had 178 full-time employees, a decrease from 192 in the previous year, reflecting ongoing adjustments to align with its strategic focus.

Looking ahead, Provident Bancorp remains committed to enhancing its core banking operations while managing risks associated with its lending portfolio. The company has indicated that it will continue to monitor economic conditions closely, particularly in its primary markets of Northeastern Massachusetts and Southern New Hampshire, as these factors significantly influence its loan performance and overall financial health. The management's outlook suggests a cautious approach to growth, emphasizing prudent underwriting standards and a focus on maintaining a diversified loan portfolio.