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PGC - Peapack-Gladstone Financial News Story

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Market Cap £491.6m
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Peapack-Gladstone Financial Corporation Reports Third Quarter Results, as Record Wealth Management Fee Income Drives Total Fee Income to 34% of Total Revenue

Thu 28th October, 2021 2:00pm
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-- Peapack-Gladstone Financial Corporation (NASDAQ Global Select Market: PGC)
(the “Company”) announces its third quarter 2021 results.

This earnings release should be read in conjunction with the Company’s Q3
2021 Investor Update (and Supplemental Financial Information), a copy of which
is available on our website at www.pgbank.com and via a current report on Form
8-K on the website of the Securities and Exchange Commission at www.sec.gov. 

For the nine months ended September 30, 2021, the Company recorded total
revenue of $154.13 million, net income of $41.77 million and diluted earnings
per share (“EPS”) of $2.15 compared to revenue of $143.22 million, net
income of $23.16 million and diluted EPS of $1.22, respectively, for the same
nine-month period ended September 30, 2020. The revenue improvement was driven
by increased wealth management fee income, net interest income and gain on the
sale of SBA loans, partially offset by reduced gain on sale of PPP loans.  

For the quarter ended September 30, 2021, the Company recorded total revenue
of $52.99 million, net income of $14.17 million and diluted earnings per share
(“EPS”) of $0.74, compared to revenue of $52.36 million, net income of
$13.55 million and diluted EPS of $0.71, respectively, for the same
three-month period ended September 30, 2020.

The three and nine months ended September 30, 2020 included a $7.4 million
gain on sale of PPP loans. The 2020 periods also included a much higher
provision for loan losses than the 2021 periods, due to the environment in
2020 created by the COVID-19 pandemic, which led to increased qualitative loss
factors when calculating the allowance for loan losses.

The September 2021 quarter included increased noninterest income (when
excluding the $7.4 million gain on sale of PPP loans in 2020), principally
record wealth management fee income and income from capital markets activities
(which includes mortgage banking income, SBA loan income, and corporate
advisory fee income) when compared to the same quarter in 2020.

The September 2021 quarter also included a $1.35 million swap valuation
allowance recorded in operating expenses related to an allowance for
termination of a loan level, back-to-back swap on a commercial real estate
loan placed on nonaccrual status.  

As previously disclosed, on January 28, 2021, the Company authorized the
repurchase of up to 948,735 shares, or approximately 5% of its outstanding
shares. During the third quarter of 2021 the Company purchased 227,060 shares
at an average price of $32.73 for a total cost of $7.43 million. Through
September 30, 2021, the Company has repurchased 619,815 shares at an average
price of $31.33 for a total cost of $19.42 million, under the program.

Douglas L. Kennedy, President and CEO, said, “Our third quarter results
showed continued growth in our wealth management and commercial banking
businesses. Our pipelines for both of these businesses continue to be robust
heading into the fourth quarter.”

Mr. Kennedy also said, “In addition to record growth in wealth management
fees year-to-date in 2021, we also saw strong growth in revenue from our
capital markets activities. Increases in these areas year-over-year more than
offset the $7.4 million of gains generated in 2020 from PPP loan sales.”  

EXECUTIVE SUMMARY:

The following tables summarize specified financial measures for the periods
shown.

September 2021 Year Compared to Prior Year

                                                   Nine Months Ended          Nine Months Ended                                            
                                                   September 30,              September 30,                Increase/                       
 (Dollars in millions, except per share data)      2021                       2020                         (Decrease)                      
 Net interest income                               $          100.85          $          95.87             $   4.98                5    %  
 Wealth management fee income (A)                             39.03                      30.07                 8.96                30      
 Capital markets activity (B)                                 7.10                       5.02                  2.08                41      
 Other income (C)                                             7.15                       12.26                 (5.11   )           (42  )  
 Total other income                                           53.28                      47.35                 5.93                13      
 Operating expenses (A) (D)                                   94.46                      85.71                 8.75                10      
 Pretax income before provision for loan losses               59.67                      57.51                 2.16                4       
 Provision for loan and lease losses (E)                      2.73                       30.05                 (27.32  )           (91  )  
 Pretax income                                                56.94                      27.46                 29.48               107     
 Income tax expense/(benefit) (F)                             15.17                      4.30                  10.87               253     
 Net income                                        $          41.77           $          23.16             $   18.61               80   %  
 Diluted EPS                                       $          2.15            $          1.22              $   0.93                76   %  
                                                                                                                                           
 Total Revenue (G)                                 $          154.13          $          143.22            $   10.91               8    %  
                                                                                                                                           
 Return on average assets annualized                          0.94       %               0.54       %          0.40                        
 Return on average equity annualized                          10.43      %               6.07       %          4.36                        

(A) The September 2021 nine months included nine months of wealth management
fee income and expense related to the December hires of the teams from Lucas
Capital Management (“Lucas”) and Noyes Capital Management (“Noyes”)
and three months of wealth management fee income and expense related to the
July acquisition of Princeton Portfolio Strategies Group (“PPSG”).

(B) Capital markets activity included fee income from loan level back-to-back
swaps, the SBA lending and sale program, corporate advisory activities and
mortgage banking activities. The September 2021 nine months included $1.3
million of corporate advisory fee income, the majority of which related to a
large investment banking advisory event, which closed in the March 2021
quarter. There were no fees related to loan level back-to-back swap activities
in the nine months ended September 30, 2021, compared to $1.6 million in the
same 2020 period.

(C) The 2021 nine months included a cost of $842,000 related to the
termination of interest rate swaps; a $1.4 million gain on loans held at lower
of cost or fair value; $722,000 of fee income related to the referral of PPP
loans to a third party; and $455,000 of additional BOLI income related to
receipt of life insurance proceeds.  The 2020 nine months included a $7.4
million gain on the sale of $355 million of PPP loans.

(D) The 2021 nine months included $1.5 million of severance expense related to
certain corporate restructuring within several areas of the Bank; $648,000 of
expense related to the redemption of subordinated debt; and $1.4 million
related to a swap valuation allowance. 

(E) The 2020 nine months included a provision for loan and lease losses of
$30.1 million, primarily due to the environment at that time created by the
COVID-19 pandemic.

(F) The 2020 nine months included a $3.2 million tax benefit related to the
carryback of tax NOLs to prior years when the Federal tax rate was 14% higher.

(G) Total revenue equals net interest income plus total other income.

September 2021 Quarter Compared to Prior Year Quarter

                                                   Three Months Ended             Three Months Ended                                          
                                                   September 30,                  September 30,                Increase/                      
 (Dollars in millions, except per share data)      2021                           2020                         (Decrease)                     
 Net interest income                               $           35.21              $           32.15            $   3.06               10   %  
 Wealth management fee income (A)                              13.86                          10.12                3.74               37      
 Capital markets activity (B)                                  2.06                           1.11                 0.95               86      
 Other income (C)                                              1.86                           8.98                 (7.12  )           (79  )  
 Total other income                                            17.78                          20.21                (2.43  )           (12  )  
 Operating expenses (A) (D)                                    32.18                          28.46                3.72               13      
 Pretax income before provision for loan losses                20.81                          23.90                (3.09  )           (13  )  
 Provision for loan and lease losses (E)                       1.60                           5.15                 (3.55  )           (69  )  
 Pretax income                                                 19.21                          18.75                0.46               2       
 Income tax expense                                            5.04                           5.20                 (0.16  )           (3   )  
 Net income                                        $           14.17              $           13.55            $   0.62               5    %  
 Diluted EPS                                       $           0.74               $           0.71             $   0.03               4    %  
                                                                                                                                              
 Total Revenue (F)                                 $           52.99              $           52.36            $   0.63               1    %  
                                                                                                                                              
 Return on average assets annualized                           0.95        %                  0.89        %        0.06                       
 Return on average equity annualized                           10.40       %                  10.53       %        (0.13  )                   

(A) The September 2021 quarter included a full quarter of wealth management
fee income and expense related to the December hires of the teams from Lucas
and Noyes and the July acquisition of PPSG.

(B) Capital markets activity included fee income from loan level back-to-back
swaps, the SBA lending and sale program, corporate advisory activities, and
mortgage banking activities.

(C) The quarter ended September 30, 2020 included a gain on sale of $7.4
million on the sale of $355 million of PPP loans.

(D) The September 2021 quarter included $1.4 million related to a swap
valuation allowance. 

(E) The September 2020 quarter included a provision for loan and lease losses
of $5.2 million, primarily due to the environment at that time created by the
COVID-19 pandemic.

(F) Total revenue equals net interest income plus total other income.

September 2021 Quarter Compared to Linked Quarter

                                                   Three Months Ended           Three Months Ended                                             
                                                   September 30,                June 30,                       Increase/                       
 (Dollars in millions, except per share data)      2021                         2021                           (Decrease)                      
 Net interest income                               $           35.21            $           33.85              $   1.36               4    %   
 Wealth management fee income (A)                              13.86                        13.03                  0.83               6        
 Capital markets activity (B)                                  2.06                         1.46                   0.60               41       
 Other income (C)                                              1.86                         3.18                   (1.32  )           (42  )   
 Total other income                                            17.78                        17.67                  0.11               1        
 Operating expenses (D)                                        32.18                        30.68                  1.50               5        
 Pretax income before provision for loan losses                20.81                        20.84                  (0.03  )           (0   )   
 Provision for loan and lease losses                           1.60                         0.90                   0.70               78       
 Pretax income                                                 19.21                        19.94                  (0.73  )           (4   )   
 Income tax expense                                            5.04                         5.52                   (0.48  )           (9   )   
 Net income                                        $           14.17            $           14.42              $   (0.25  )           (2   )%  
 Diluted EPS                                       $           0.74             $           0.74               $   -                  0    %   
                                                                                                                                               
 Total Revenue (E)                                 $           52.99            $           51.52              $   1.47               3    %   
                                                                                                                                               
 Return on average assets annualized                           0.95        %                0.97        %          (0.02  )                    
 Return on average equity annualized                           10.40       %                10.86       %          (0.46  )                    

(A) The September 2021 quarter included a full quarter of wealth management
fee income and expense related to the July acquisition of PPSG.

(B) Capital markets activity included fee income from loan level back-to-back
swaps, the SBA lending and sale program, corporate advisory and mortgage
banking activities.

(C) The quarter ended June 30, 2021 included a cost of $842,000 related to the
termination of interest rate swaps; a $1.1 million gain on the sale of PPP
loans; $722,000 of fee income related to the referral of PPP loans to a third
party; and $153,000 of additional BOLI income related to receipt of life
insurance proceeds.

(D) The September 2021 quarter included $1.4 million related to a swap
valuation allowance.   The June 2021 quarter included $648,000 of expense
related to the redemption of subordinated debt.

(E) Total revenue equals net interest income plus total other income.

The Company’s priorities include:
* Grow and expand our three primary drivers of profitability: Wealth
Management, Commercial Banking and Capital Markets businesses.
* Continued well-disciplined wealth management acquisitions. 
* Continue loan and deposit pricing discipline. 
* Continue to execute on our stock repurchase program.
* Drive Return on Assets to greater than 1% and Return on Average Tangible
Common Equity to greater than 14% over time.
Select highlights:

Peapack Private Wealth Management:
* AUM/AUA in our Peapack Private Wealth Management Division grew to $10.3
billion at September 30, 2021 (from $8.8 billion at December 31, 2020).
* Wealth Management fee income increased to $14 million for Q3 2021 (compared
to $10 million for Q3 2020).
* On July 1, 2021, we closed on the acquisition of PPSG.
Commercial Banking and Balance Sheet Management:
* At September 30, 2021, loans totaled $4.55 billion (excluding $49 million of
PPP loans), compared to $4.21 billion (excluding $196 million of PPP loans) at
December 31, 2020, reflecting growth of 8% (or 11% annualized)  
* Core deposits (which includes noninterest-bearing demand and
interest-bearing demand, savings and money market) totaled 89% of total
deposits at September 30, 2021, with an average cost of 0.17%. Noninterest
bearing demand deposit accounts (included in core deposits) totaled 18% of
total deposits. 
* The net interest margin improved by 4 basis points in Q3 2021 compared to Q2
2021 and improved 22 basis points when compared to Q3 2020.   
Capital Management:
* Continued to execute on the previously approved stock repurchase program –
during Q3 repurchased 227,060 shares at an average price of $32.73 for a total
cost of $7.4 million. (Year-to-date through September 30, 2021, the Company
has repurchased 619,815 shares). 
* Tangible book value per share increased to $26.50 at September 30, 2021 from
$25.47 at December 31, 2020, despite recent stock repurchase activity. See the
Non-GAAP financial measures reconciliation included in this release.
SUPPLEMENTAL QUARTERLY DETAILS:

Wealth Management

In the September 2021 quarter, the Bank’s wealth management business
generated a record $13.86 million in fee income, compared to $10.12 million
for the September 2020 quarter, and $13.03 million for the June 2021 quarter.

The market value of the Company’s AUM/AUA increased to $10.3 billion at
September 30, 2021 from $8.8 billion at December 31, 2020, due to $715 million
of organic new business, acquisitions, and favorable market conditions.

John P. Babcock, President of the Peapack Private Wealth Management division,
said, “2021 showed continued strong new business, new client acquisition and
client retention. We ended 2020 with a very strong Q4 and this continued into
2021 with gross inflows of $715 million for the first nine months of 2021.”
Babcock went on to note, “We continue to look to grow our wealth business
organically and through selective acquisitions. We continue to make
significant progress on our infrastructure consolidation including launching
our new trading platform, as well as adding more resources to our financial
planning team.”

Loans / Commercial Banking

At September 30, 2021, loans and leases totaled $4.55 billion (excluding $49
million of PPP loans), compared to $4.21 billion (excluding $196 million of
PPP loans) at December 31, 2020, reflecting year-to-date growth of $338
million or 8% (11% annualized). This growth was achieved despite over $400
million of accelerated prepayments over the nine-month period.  

Total C&I loans and leases (including the PPP loans) at September 30, 2021
were $1.83 billion or 40% of the total loan portfolio.

Mr. Kennedy noted, “Our commercial loan pipelines continue to be strong
going into the fourth quarter, standing at approximately $400 million with
likelihood of closing during the fourth quarter of 2021. Notwithstanding the
sale and forgiveness of PPP loans and significant payoff activity, we believe
that we will achieve high single digit loan growth for 2021, which was the
upper end of our guidance provided in the beginning of 2021.”

Mr. Kennedy also noted, “As mentioned in the past, our Corporate Advisory
business, which gives us the capability to engage in high level strategic
debt, capital and valuation analysis, is enabling us to provide a unique
boutique level of service. This business has gained momentum and also has a
robust pipeline of new business opportunities.”

Funding / Liquidity / Interest Rate Risk Management

The Company actively manages its deposit base to reduce reliance on wholesale
sourced deposits, volatility, and/or operational risk.  Total deposits at
September 30, 2021 increased $558 million to $5.38 billion from $4.82 billion
at December 31, 2020. Along with the deposit growth, the change in mix was
favorable, as noninterest bearing demand deposits increased $153 million,
interest-bearing demand increased $507 million, while higher costing CDs
declined $104 million and brokered deposits declined $25 million, when
comparing September 30, 2021 to December 31, 2020. 

Mr. Kennedy noted, “89% of our deposits are demand, savings, or money
market, and, our noninterest bearing deposits comprise 18% of our total
deposits; both metrics reinforce the “core” nature of our deposit base.”

At September 30, 2021, the Company’s balance sheet liquidity (investments,
interest-earning deposits and cash) totaled $1.5 billion (or 24% of assets).
 This level is much higher than the level at June 30, 2021 due to a
significant increase in core deposits during Q3 2021. In addition, the Company
has approximately $1.9 billion of secured funding available from the Federal
Home Loan Bank and $1.1 billion of secured funding available from the Federal
Reserve Discount Window.  The available funding from the Federal Home Loan
Bank and the Federal Reserve is secured by the Company’s loan and investment
portfolios.

Mr. Kennedy noted, “As a commercial bank, a large portion of our loans
reprice when the Fed changes rates. The 150-basis point reduction in target
Fed Funds near the end of the first quarter of 2020 reduced the Company’s
yield on assets. However, we were able to strategically reprice our deposits
over time to offset much of that decline. Further, when interest rates rise,
we expect that our net interest income will improve. Our current modeling
indicates that 42% of our loan portfolio will reprice within three months (54%
within one-year).”

Net Interest Income (NII)/Net Interest Margin (NIM)

                                                     Nine Months Ended                          Nine Months Ended                                                               
                                                     September 30, 2021                         September 30, 2020                                                              
                                                     NII                        NIM             NII                       NIM                                                   
                                                                                                                                                                                
 NII/NIM excluding the below                         $     97,655               2.53%           $     91,901              2.51%                                                 
 Prepayment premiums received on loan paydowns             1,530                0.03%                 1,005               0.02%                                                 
 Effect of maintaining excess interest earning cash        (365     )           -0.17%                (1,000  )           -0.19%                                                
 Effect of PPP loans                                       2,029                -0.04%                3,961               -0.01%                                                
 NII/NIM as reported                                 $     100,849              2.35%           $     95,867              2.33%                                                 
                                                                                                                                                                                
                                                     Three Months Ended                         Three Months Ended                        Three Months Ended                    
                                                     September 30, 2021                         June 30, 2021                             September 30, 2020                    
                                                     NII                        NIM             NII                       NIM             NII                       NIM         
                                                                                                                                                                                
 NII/NIM excluding the below                         $     34,635               2.56%           $     32,446              2.56%           $     30,327              2.45%       
 Prepayment premiums received on loan paydowns             325                  0.02%                 501                 0.04%                 104                 0.01%       
 Effect of maintaining excess interest earning cash        (46      )           -0.14%                (115    )           -0.15%                (266    )           -0.24%      
 Effect of PPP loans                                       297                  -0.02%                1,013               -0.07%                1,984               -0.02%      
 NII/NIM as reported                                 $     35,211               2.42%           $     33,845              2.38%           $     32,149              2.20%       

As shown above, the Company’s reported NIM increased 4 basis points compared
to the linked quarter. The Bank strategically lowered its cost of funds and
grew its average loan portfolio, both of which benefitted NIM.

Future net interest income and net interest margin should benefit from the
following:
* Robust loan pipelines to generate loan growth and utilize excess liquidity.
* Continued downward repricing of maturing CDs. 
* An increase in target Fed funds (should that occur).
Income from Capital Markets Activities

                                                                 Three Months Ended          Three Months Ended          Three Months Ended        
                                                                 September 30,               June 30,                    September 30,             
 (Dollars in thousands, except per share data)                   2021                        2021                        2020                      
 Gain on loans held for sale at fair value (Mortgage banking)    $           408             $           409             $           954           
 Fee income related to loan level, back-to-back swaps                        —                           —                           —             
 Gain on sale of SBA loans                                                   1,569                       932                         79            
 Corporate advisory fee income                                               84                          121                         75            
 Total capital markets activity                                  $           2,061           $           1,462           $           1,108         

Noninterest income from Capital Markets activities (detailed above) totaled
$2.06 million for the September 2021 quarter compared to $1.46 million for the
June 2021 quarter and $1.11 million for the September 2020 quarter.  The
September 2021 and June 2021 quarter results were driven by $1.57 million and
$932,000 in gains on the sale of SBA loans, respectively. The September 2020
quarter reflected increased mortgage banking activity due to greater refinance
activity in the low-rate environment. During the September 2021, June 2021 and
September 2020 quarter, the Company recorded minimal corporate advisory fee
income.  These transactions tend to be larger and take longer to complete. As
noted previously, the pipeline of such business is robust. The September 2021,
June 2021 and September 2020 quarters included no income from loan level,
back-to-back swap activities, as there has been, and will continue to be,
minimal activity for such in the current environment.

Other Noninterest Income (other than Wealth Management fee income and Income
from Capital Markets Activities)

                Other noninterest income (as defined above)
totaled $1.86 million, $3.18 million, and $8.98 million, for the September
2021, June 2021, and September 2020 quarters, respectively. The June 2021
quarter included $153,000 of Bank Owned life Insurance income due to receipt
of life insurance proceeds; a $1.13 million gain on the sale of PPP loans; and
$722,000 of fee income related to referral of PPP loans to a third party. This
was partially offset by an $842,000 cost on the termination of $40 million
notional interest rate swaps with an all-in cost of 1.50%. The September 2020
quarter included a $7.43 million gain on the sale of PPP loans.

Operating Expenses

The Company’s total operating expenses were $32.18 million for the quarter
ended September 30, 2021, compared to $30.68 million for the June 2021 quarter
and $28.46 million for the September 2020 quarter. The September 2021 quarter
included $1.35 million related to a swap valuation allowance.  The September
2021 quarter also included a full quarter’s worth of expense related to the
teams hired from Lucas and Noyes and the acquisition of PPSG. The June 2021
quarter included $648,000 of expense related to the redemption of subordinated
debt.  The June 2021 quarter also included a full quarter’s worth of
expense related to the teams hired from Lucas and Noyes.

Mr. Kennedy noted, “While we continue to manage expenses closely and
prudently, we will invest in digital enhancements to improve the client
experience and grow and expand our core wealth management and commercial
banking businesses, including lift-outs, strategic hires, and wealth M&A.”

Income Taxes

The effective tax rate for the three months ended September 30, 2021 was
26.22%, as compared to 27.69% for the June 2021 quarter and 27.75% for the
quarter ended September 30, 2020.

The effective tax rate for the nine months of 2021 was 26.65% compared to
15.65% for the first nine months of 2020.  During the first quarter of 2020,
the Company recorded a $3.34 million tax benefit, principally due to a $3.2
million Federal income tax benefit that resulted from a tax NOL carryback. The
Company had a $23 million operating loss for tax purposes in 2018 (when the
Federal tax rate was 21%) resulting from accelerated tax depreciation. Under
the CARES Act, the Company was allowed to carry this NOL back to a period when
the Federal tax rate was 35%, generating a permanent tax benefit. 

Asset Quality / Provision for Loan and Lease Losses

For further details, see the Q3 2021 Investor Update (and Supplemental
Financial Information).

Nonperforming assets (which does not include troubled debt restructured loans
that are performing in accordance with their terms) at September 30, 2021 were
$25.9 million, or 0.42% of total assets, compared to $11.5 million, or 0.19%
of total assets, at December 31, 2020. A single large commercial real estate
loan with a large retail component, and on deferral, was placed on nonaccrual
status as of September 30, 2021.  

For the quarter ended September 30, 2021, the Company’s provision for loan
and lease losses was $1.6 million compared to $900,000 for the June 2021
quarter and $5.15 million for the September 2020 quarter. The decreased
provision for loan and lease losses in the 2021 quarters when compared to the
2020 quarter reflect the reduced qualitative loss factors related to the
unemployment rate and amount of loan deferrals and other economic qualitative
factors due to the COVID-19 pandemic, when calculating the allowance for loan
losses. Loans on deferral, and accruing, entered into during the COVID-19
pandemic have come down significantly from the prior year (declined from $914
million at June 30, 2020 to $13 million at September 30, 2021). The
Company’s provision for loan and lease losses, and its allowance for loan
and lease losses (ALLL) also reflect, among other things, the Company’s
assessment of asset quality metrics, net charge-offs/recoveries, and the
composition of the loan portfolio.

At September 30, 2021, the allowance for loan and lease losses was $65.13
million (1.42% of total loans), compared to $63.51 million at June 30, 2021
(1.39% of loans) and $67.31 million at December 31, 2020 (1.53% of total
loans).  See page 16 in the Q3 2021 Investor Update (and Supplemental
Financial Information) for a rollforward of the Company’s ALLL from June 30,
2021 to September 30, 2021. The Company will adopt CECL effective January 1,
2022 and does not expect a material adjustment upon adoption.

Capital

The Company’s capital position during the September 2021 quarter was
benefitted by net income of $14.17 million, which was offset by the purchase
of shares through the Company’s stock repurchase program and the quarterly
dividend. During the third quarter of 2021, the Company repurchased 227,060
shares at an average price of $32.73 for a total cost of $7.4 million.  GAAP
Capital at September 30, 2021 was also impacted by an increase in the
unrealized loss on securities from June 30, 2021 to September 30, 2021, due to
a rise in medium-term Treasury yields as of September 30, 2021.

The Company’s and Bank’s capital ratios at September 30, 2021 all remain
strong.  Such ratios remain well above regulatory well capitalized standards.

As previously announced, in the fourth quarter of 2020, the Company
successfully completed a private placement of $100 million in fixed-to
floating rate subordinated notes due 2030 at a rate of 3.5%. Such funds
benefitted the Company’s Regulatory Tier 2 Capital. At the time, the Company
noted the proceeds raised would be used for general corporate purposes, which
could include stock repurchases, the redemption of the Company’s existing 6%
subordinated debt and acquisitions of wealth management firms. Throughout the
first nine months of 2021, the Company repurchased $19 million of stock.  On
June 30, 2021 the Company redeemed its 6% subordinated debt. On July 1, 2021
the Company closed on the acquisition of PPSG.

The Company employs quarterly capital stress testing run under multiple
scenarios, including a no growth, severely adverse case. In such case as of
June 30, 2021, the Bank remains well capitalized over a two-year stress
period. With a Pandemic stress overlay on this case, the Bank still remains
well capitalized over the two-year stress period. For further details, see
page 26 in the Q3 2021 Investor Update (and Supplemental Financial
Information).

On October 27, 2021, the Company declared a cash dividend of $0.05 per share
payable on November 26, 2021 to shareholders of record on November 10, 2021.

ABOUT THE COMPANY

Peapack-Gladstone Financial Corporation is a New Jersey bank holding company
with total assets of $6.2 billion and assets under management/administration
of $10.3 billion as of September 30, 2021.  Founded in 1921,
Peapack-Gladstone Bank is a commercial bank that provides innovative wealth
management, commercial and retail solutions, including residential lending and
online platforms, to businesses and consumers.  Peapack Private, the bank’s
wealth management division, offers comprehensive financial, tax, fiduciary and
investment advice and solutions, to individuals, families, privately-held
businesses, family offices and not-for-profit organizations, which help them
to establish, maintain and expand their legacy.  Together, Peapack-Gladstone
Bank and Peapack Private offer an unparalleled commitment to client service. 
Visit www.pgbank.com and www.peapackprivate.com for more information.

The foregoing may contain forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995.  Such statements are not
historical facts and include expressions about management’s confidence and
strategies and management’s expectations about new and existing programs and
products, investments, relationships, opportunities and market conditions. 
These statements may be identified by such forward-looking terminology as
“expect,” “look,” “believe,” “anticipate,” “may” or
similar statements or variations of such terms.  Actual results may differ
materially from such forward-looking statements.  Factors that may cause
results to differ materially from such forward-looking statements include, but
are not limited to:
* our inability to successfully grow our business and implement our strategic
plan, including an inability to generate revenues to offset the increased
personnel and other costs related to the strategic plan;
* the impact of anticipated higher operating expenses in 2021 and beyond;
* our inability to successfully integrate wealth management firm acquisitions;
* our inability to manage our growth;
* our inability to successfully integrate our expanded employee base;
* an unexpected decline in the economy, in particular in our New Jersey and
New York market areas;
* declines in our net interest margin caused by the interest rate environment
and/or our highly competitive market;
* declines in the value in our investment portfolio;
* impact from a pandemic event on our business, operations, customers,
allowance for loan losses and capital levels;
* higher than expected increases in our allowance for loan and lease losses;
* higher than expected increases in loan and lease losses or in the level of
delinquent, nonperforming, classified and criticized loans;
* changes in interest rates;
* decline in real estate values within our market areas;
* legislative and regulatory actions (including the impact of the Dodd-Frank
Wall Street Reform and Consumer Protection Act, Basel III and related
regulations) that may result in increased compliance costs;
* successful cyberattacks against our IT infrastructure and that of our IT and
third-party providers;
* higher than expected FDIC insurance premiums;
* adverse weather conditions;
* our inability to successfully generate new business in new geographic
markets;
* a reduction in our lower-cost funding sources;
* our inability to adapt to technological changes; 
* claims and litigation pertaining to fiduciary responsibility, environmental
laws and other matters;
* our inability to retain key employees;
* demands for loans and deposits in our market areas;
* adverse changes in securities markets;
* changes in accounting policies and practices; and
* other unexpected material adverse changes in our operations or earnings.
Further, given its ongoing and dynamic nature, it is difficult to predict the
full impact of the COVID-19 pandemic on our business. The extent of such
impact will depend on future developments, which are highly uncertain,
including when the coronavirus can be controlled and abated and when and
whether the gradual reopening of businesses will result in a meaningful
increase in economic activity.  As the result of the COVID-19 pandemic and
the related adverse local and national economic consequences, we could be
subject to any of the following risks, any of which could have a material,
adverse effect on our business, financial condition, liquidity, and results of
operations:
* demand for our products and services may decline, making it difficult to
grow assets and income; 
* if the economy is unable to substantially reopen, and higher levels of
unemployment continue for an extended period of time, loan delinquencies,
problem assets, and foreclosures may increase, resulting in increased charges
and reduced income; 
* collateral for loans, especially real estate, may decline in value, which
could cause loan losses to increase; 
* our allowance for loan losses may increase if borrowers experience financial
difficulties, which will adversely affect our net income; 
* the net worth and liquidity of loan guarantors may decline, impairing their
ability to honor commitments to us; 
* a material decrease in net income or a net loss over several quarters could
result in an elimination or a decrease in the rate of our quarterly cash
dividend; 
* our wealth management revenues may decline with continuing market turmoil; 
* a worsening of business and economic conditions or in the financial markets
could result in an impairment of certain intangible assets, such as goodwill;
* the unanticipated loss or unavailability of key employees due to the
outbreak, which could harm our ability to operate our business or execute our
business strategy, especially as we may not be successful in finding and
integrating suitable successors;
* we may face litigation, regulatory enforcement and reputation risk as a
result of our participation in the PPP and the risk that the SBA may not fund
some or all PPP loan guaranties;
* our cyber security risks are increased as the result of an increase in the
number of employees working remotely; and 
* FDIC premiums may increase if the agency experience additional resolution
costs.
A discussion of these and other factors that could affect our results is
included in our SEC filings, including our Annual Report on Form 10-K for the
year ended December 31, 2020.  We undertake no duty to update any
forward-looking statement to conform the statement to actual results or
changes in the Company’s expectations.

Although we believe that the expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee future results, levels of
activity, performance or achievements.

 (Tables to follow)
PEAPACK-GLADSTONE FINANCIAL CORPORATION
SELECTED CONSOLIDATED FINANCIAL DATA
(Dollars in Thousands, except share data)
 (Unaudited)

                                                                         For the Three Months Ended                                                                                                       
                                                                         Sept 30,                   June 30,                   March 31,                  Dec 31,                   Sept 30,              
                                                                         2021                       2021                       2021                       2020                      2020                  
 Income Statement Data:                                                                                                                                                                                   
 Interest income                                                         $      40,067              $      39,686              $      38,239              $     38,532              $      40,174         
 Interest expense                                                               4,856                      5,841                      6,446                     6,797                      8,025          
 Net interest income                                                            35,211                     33,845                     31,793                    31,735                     32,149         
 Wealth management fee income                                                   13,860                     13,034                     12,131                    10,791                     10,119         
 Service charges and fees                                                       959                        896                        846                       859                        785            
 Bank owned life insurance                                                      311                        466                        611                       313                        314            
 Gain on loans held for sale at fair value (Mortgage banking) (A)               408                        409                        1,025                     1,470                      954            
 Gain/(loss) on loans held for sale at lower of cost or fair value(B)           —                          1,125                      282                       —                          7,429          
 Fee income related to loan level, back-to-back swaps (A)                       —                          —                          —                         —                          —              
 Gain on sale of SBA loans (A)                                                  1,569                      932                        1,449                     375                        79             
 Corporate advisory fee income (A)                                              84                         121                        1,098                     50                         75             
 Loss on swap termination                                                       —                          (842        )              —                         —                          —              
 Other income (C)                                                               660                        1,495                      643                       590                        456            
 Securities gains/(losses), net                                                 (70         )              42                         (265        )             (42         )              —              
 Total other income                                                             17,781                     17,678                     17,820                    14,406                     20,211         
 Salaries and employee benefits (D)                                             19,859                     19,910                     21,990                    19,902                     19,202         
 Premises and equipment                                                         4,459                      4,074                      4,113                     4,189                      4,109          
 FDIC insurance expense                                                         555                        529                        585                       665                        605            
 FHLB prepayment penalty                                                        —                          —                          —                         4,784                      —              
 Valuation allowance loans held for sale (E)                                    —                          —                          —                         4,425                      —              
 Swap valuation allowance                                                       1,350                      —                          —                         —                          —              
 Other expenses                                                                 5,962                      6,171                      4,906                     5,284                      4,545          
 Total operating expenses                                                       32,185                     30,684                     31,594                    39,249                     28,461         
 Pretax income before provision for loan losses                                 20,807                     20,839                     18,019                    6,892                      23,899         
 Provision for loan and lease losses (F)                                        1,600                      900                        225                       2,350                      5,150          
 Income before income taxes                                                     19,207                     19,939                     17,794                    4,542                      18,749         
 Income tax expense                                                             5,036                      5,521                      4,616                     1,512                      5,202          
 Net income                                                              $      14,171              $      14,418              $      13,178              $     3,030               $      13,547         
                                                                                                                                                                                                          
 Total revenue (G)                                                       $      52,992              $      51,523              $      49,613              $     46,141              $      52,360         
 Per Common Share Data:                                                                                                                                                                                   
 Earnings per share (basic)                                              $      0.76                $      0.76                $      0.70                $     0.16                $      0.72           
 Earnings per share (diluted)                                                   0.74                       0.74                       0.67                      0.16                       0.71           
 Weighted average number of common shares outstanding:                                                                                                                                                    
 Basic                                                                          18,763,316                 18,963,237                 18,950,305                18,947,864                 18,908,337     
 Diluted                                                                        19,273,831                 19,439,439                 19,531,689                19,334,569                 19,132,650     
 Performance Ratios:                                                                                                                                                                                      
 Return on average assets annualized (ROAA)                                     0.95        %              0.97        %              0.89        %             0.21        %              0.89        %  
 Return on average equity annualized (ROAE)                                     10.40       %              10.86       %              10.03       %             2.32        %              10.53       %  
 Return on average tangible common equity (ROATCE) (H)                          11.43       %              11.83       %              10.94       %             2.51        %              11.41       %  
 Net interest margin (tax-equivalent basis)                                     2.42        %              2.38        %              2.28        %             2.25        %              2.20        %  
 GAAP efficiency ratio (I)                                                      60.74       %              59.55       %              63.68       %             85.06       %              54.36       %  
 Operating expenses / average assets annualized                                 2.16        %              2.06        %              2.14        %             2.66        %              1.86        %  

(A) Gain on loans held for sale at fair value (mortgage banking), fee income
related to loan level, back-to-back swaps, gain on sale of SBA loans and
corporate advisory fee income are all included in “capital markets
activity” as referred to within the earnings release.

(B) Includes gain on sale of $355 million and $57 million of PPP loans
completed in the September 2020 and June 2021 quarters, respectively.

(C) Includes income of $722,000 from the referral of PPP loans to a
third-party firm during the June 2021 quarter.

(D) The March 2021 quarter included $1.5 million of severance expense related
to corporate restructuring.

(E) The December 2020 quarter reflects a $4.4 million write-down of a
commercial real estate held for sale loan associated with an assisted living
facility.

(F) The September 2020 and December 2020 quarters included a higher provision
for loan and lease losses primarily due to the environment created by the
COVID-19 pandemic.

(G) Total revenue equals net interest income plus total other income.

(H) Return on average tangible common equity is calculated by dividing
tangible common equity by annualized net income.  See Non-GAAP financial
measures reconciliation included in these tables.

(I) Calculated as total operating expenses as a percentage of total revenue. 
For Non-GAAP efficiency ratio, see the Non-GAAP financial measures
reconciliation included in these tables.

PEAPACK-GLADSTONE FINANCIAL CORPORATION
SELECTED CONSOLIDATED FINANCIAL DATA
(Dollars in Thousands, except share data)
 (Unaudited)

                                                                     For the Nine Months Ended                                                                  
                                                                     September 30,                                            Change                            
                                                                     2021                             2020                    $                    %            
 Income Statement Data:                                                                                                                                         
 Interest income                                                     $      117,992                   $      127,218          $   (9,226   )           -7    %  
 Interest expense                                                           17,143                           31,351               (14,208  )           -45   %  
 Net interest income                                                        100,849                          95,867               4,982                5     %  
 Wealth management fee income                                               39,025                           30,070               8,955                30    %  
 Service charges and fees                                                   2,701                            2,296                405                  18    %  
 Bank owned life insurance                                                  1,388                            960                  428                  45    %  
 Gain on loans held for sale at fair value (Mortgage banking) (A)           1,842                            1,796                46                   3     %  
 Gain on loans held for sale at lower of cost or fair value (B)             1,407                            7,426                (6,019   )           -81   %  
 Fee income related to loan level, back-to-back swaps (A)                   —                                1,620                (1,620   )           -100  %  
 Gain on sale of SBA loans (A)                                              3,950                            1,391                2,559                184   %  
 Corporate advisory fee income (A)                                          1,303                            215                  1,088                506   %  
 Loss on swap termination                                                   (842        )                    —                    (842     )       N/A          
 Other income (C)                                                           2,798                            1,257                1,541                123   %  
 Securities gains/(losses), net                                             (293        )                    323                  (616     )           -191  %  
 Total other income                                                         53,279                           47,354               5,925                13    %  
 Salaries and employee benefits (D)                                         61,759                           57,614               4,145                7     %  
 Premises and equipment                                                     12,646                           12,188               458                  4     %  
 FDIC insurance expense                                                     1,669                            1,310                359                  27    %  
 Swap valuation allowance                                                   1,350                            —                    1,350            N/A          
 Other expenses                                                             17,039                           14,598               2,441                17    %  
 Total operating expenses                                                   94,463                           85,710               8,753                10    %  
 Pretax income before provision for loan losses                             59,665                           57,511               2,154                4     %  
 Provision for loan and lease losses (E)                                    2,725                            30,050               (27,325  )           -91   %  
 Income before income taxes                                                 56,940                           27,461               29,479               107   %  
 Income tax expense (F)                                                     15,173                           4,299                10,874               253   %  
 Net income                                                          $      41,767                    $      23,162           $   18,605               80    %  
                                                                                                                                                                
 Total revenue (G)                                                   $      154,128                   $      143,221          $   10,907               8     %  
 Per Common Share Data:                                                                                                                                         
 Earnings per share (basic)                                          $      2.21                      $      1.23             $   0.98                 80    %  
 Earnings per share (diluted)                                               2.15                             1.22                 0.93                 76    %  
 Weighted average number of common shares outstanding:                                                                                                          
 Basic                                                                      18,891,601                       18,879,688           21,913               0     %  
 Diluted                                                                    19,390,522                       19,052,605           337,917              2     %  
 Performance Ratios:                                                                                                                                            
 Return on average assets annualized (ROAA)                                 0.94        %                    0.54        %        0.40     %           74    %  
 Return on average equity annualized (ROAE)                                 10.43       %                    6.07        %        4.36     %           72    %  
 Return on average tangible common equity (ROATCE) (H)                      11.40       %                    6.59        %        4.81     %           73    %  
 Net interest margin (tax-equivalent basis)                                 2.35        %                    2.33        %        0.02     %           1     %  
 GAAP efficiency ratio (I)                                                  61.29       %                    59.84       %        1.45     %           2     %  
 Operating expenses / average assets annualized                             2.12        %                    1.99        %        0.13     %           7     %  

(A) Gain on loans held for sale at fair value (mortgage banking), fee income
related to loan level, back-to-back swaps, gain on sale of SBA loans and
corporate advisory fee income are all included in “capital markets
activity” as referred to within the earnings release.

(B) Includes gain on sale of PPP loans of $57 million and $355 million
completed in the nine months ended September 30, 2021 and 2020, respectively.

(C) Includes income of $722,000 from the referral of PPP loans to a
third-party firm during the nine months ended September 2021.

(D) The nine months ended September 30, 2021 included $1.5 million of
severance expense related to corporate restructuring.

(E) The nine months ended September 30, 2020 included a higher provision for
loan and lease losses primarily due to the environment created by the COVID-19
pandemic.

(F) 2020 included a $3.2 million tax benefit related to the carryback of tax
NOLs to prior years when the Federal tax rate was 14% higher.

(G) Total revenue equals net interest income plus total other income.

(H) Return on average tangible common equity is calculated by dividing
tangible common equity by annualized net income.  See Non-GAAP financial
measures reconciliation included in these tables.

(I) Calculated as total operating expenses as a percentage of total revenue. 
For Non-GAAP efficiency ratio, see the Non-GAAP financial measures
reconciliation included in these tables.

PEAPACK-GLADSTONE FINANCIAL CORPORATION
 CONSOLIDATED STATEMENTS OF CONDITION
(Dollars in Thousands)
(Unaudited)

                                                                                                                                                                              As of                                                                                                              
                                                                                                                                                                              Sept 30,                June 30,                March 31,               Dec 31,                Sept 30,            
                                                                                                                                                                              2021                    2021                    2021                    2020                   2020                
 ASSETS                                                                                                                                                                                                                                                                                          
 Cash and due from banks                                                                                                                                                      $      9,299            $      12,684           $      8,159            $     10,629           $      8,400        
 Federal funds sold                                                                                                                                                                  —                       —                       102                    102                     102          
 Interest-earning deposits                                                                                                                                                           606,913                 190,778                 468,276                642,591                 670,863      
 Total cash and cash equivalents                                                                                                                                                     616,212                 203,462                 476,537                653,322                 679,365      
 Securities available for sale                                                                                                                                                       843,779                 823,820                 875,301                622,689                 596,929      
 Equity security                                                                                                                                                                     14,824                  14,894                  14,852                 15,117                  15,159       
 FHLB and FRB stock, at cost                                                                                                                                                         12,950                  12,901                  13,699                 13,709                  18,433       
 Residential mortgage                                                                                                                                                                510,878                 504,181                 498,884                520,188                 532,120      
 Multifamily mortgage                                                                                                                                                                1,497,683               1,420,043               1,178,940              1,127,198               1,168,796    
 Commercial mortgage                                                                                                                                                                 680,107                 702,777                 697,599                694,034                 722,678      
 Commercial loans (A)                                                                                                                                                                1,833,532               1,880,830               1,982,570              1,975,337               1,930,984    
 Consumer loans                                                                                                                                                                      30,689                  31,889                  36,519                 37,016                  51,859       
 Home equity lines of credit                                                                                                                                                         42,512                  44,062                  45,624                 50,547                  52,194       
 Other loans                                                                                                                                                                         245                     204                     199                    225                     260          
 Total loans                                                                                                                                                                         4,595,646               4,583,986               4,440,335              4,404,545               4,458,891    
 Less: Allowances for loan and lease losses                                                                                                                                          65,133                  63,505                  67,536                 67,309                  66,145       
 Net loans                                                                                                                                                                           4,530,513               4,520,481               4,372,799              4,337,236               4,392,746    
 Premises and equipment                                                                                                                                                              23,123                  23,261                  23,260                 21,609                  21,668       
 Other real estate owned                                                                                                                                                             —                       —                       50                     50                      50           
 Accrued interest receivable                                                                                                                                                         22,790                  23,117                  23,916                 22,495                  22,192       
 Bank owned life insurance                                                                                                                                                           46,510                  46,605                  46,448                 46,809                  46,645       
 Goodwill and other intangible assets                                                                                                                                                49,333                  43,156                  43,524                 43,891                  39,622       
 Finance lease right-of-use assets                                                                                                                                                   3,769                   3,956                   4,143                  4,330                   4,517        
 Operating lease right-of-use assets                                                                                                                                                 10,307                  9,569                   10,186                 9,421                   10,011       
 Other assets (B)                                                                                                                                                                    66,175                  66,466                  64,912                 99,764                  110,770      
 TOTAL ASSETS                                                                                                                                                                 $      6,240,285        $      5,791,688        $      5,969,627        $     5,890,442        $      5,958,107    
                                                                                                                                                                                                                                                                                                 
 LIABILITIES                                                                                                                                                                                                                                                                                     
 Deposits:                                                                                                                                                                                                                                                                                       
 Noninterest-bearing demand deposits                                                                                                                                          $      986,765          $      959,494          $      908,922          $     833,500          $      838,307      
 Interest-bearing demand deposits                                                                                                                                                    2,355,892               1,978,497               1,987,567              1,849,254               1,858,529    
 Savings                                                                                                                                                                             168,831                 147,227                 141,743                130,731                 127,737      
 Money market accounts                                                                                                                                                               1,287,686               1,213,992               1,256,605              1,298,885               1,251,349    
 Certificates of deposit – Retail                                                                                                                                                    426,981                 446,143                 474,668                530,222                 586,801      
 Certificates of deposit – Listing Service                                                                                                                                           31,382                  31,631                  31,631                 32,128                  32,677       
 Subtotal “customer” deposits                                                                                                                                                        5,257,537               4,776,984               4,801,136              4,674,720               4,695,400    
 IB Demand – Brokered                                                                                                                                                                85,000                  85,000                  110,000                110,000                 130,000      
 Certificates of deposit – Brokered                                                                                                                                                  33,804                  33,791                  33,777                 33,764                  33,750       
 Total deposits                                                                                                                                                                      5,376,341               4,895,775               4,944,913              4,818,484               4,859,150    
 Short-term borrowings                                                                                                                                                               —                       —                       15,000                 15,000                  15,000       
 FHLB advances (C)                                                                                                                                                                   —                       —                       —                      —                       105,000      
 Paycheck Protection Program Liquidity Facility (D)                                                                                                                                  48,496                  83,586                  168,180                177,086                 183,790      
 Finance lease liability                                                                                                                                                             6,063                   6,299                   6,528                  6,753                   6,976        
 Operating lease liability                                                                                                                                                           10,644                  9,902                   10,509                 9,737                   10,318       
 Subordinated debt, net (E)                                                                                                                                                          132,629                 132,557                 181,837                181,794                 83,585       
 Other liabilities (B)                                                                                                                                                               123,098                 125,110                 120,219                154,466                 156,472      
 Due to brokers                                                                                                                                                                      —                       —                       —                      —                       15,088       
 TOTAL LIABILITIES                                                                                                                                                                   5,697,271               5,253,229               5,447,186              5,363,320               5,435,379    
 Shareholders’ equity                                                                                                                                                                543,014                 538,459                 522,441                527,122                 522,728      
 TOTAL LIABILITIES AND                                                                                                                                                                                                                                                                           
 SHAREHOLDERS’ EQUITY                                                                                                                                                         $      6,240,285        $      5,791,688        $      5,969,627        $     5,890,442        $      5,958,107    
 Assets under management and / or administration at Peapack-Gladstone Bank ’ s Private Wealth Management Division (market value, not included above-dollars in billions)      $      10.3             $      9.8              $      9.4              $     8.8              $      7.6          

(A) Includes PPP loans of $49 million at September 30, 2021, $84 million at
June 30, 2021, $233 million at March 31, 2021, $196 million at December 31,
2020, and $202 million at September 30, 2020.

(B) The change in other assets and other liabilities was primarily due to the
change in the fair value of our back-to-back swap program.

(C) The Company prepaid $105 million of FHLB advances with a weighted-average
rate of 3.20% during the December 2020 quarter.

(D) Represents funding provided by the Federal Reserve for pledged PPP loans.

(E) The increase was due to the completion of a $100 million subordinated debt
offering in December 2020.  The Company redeemed $50 million of subordinated
debt on June 30, 2021.



PEAPACK-GLADSTONE FINANCIAL CORPORATION
SELECTED BALANCE SHEET DATA
(Dollars in Thousands)
(Unaudited)

                                                                As of                                                                                                     
                                                                Sept 30,              June 30,              March 31,             Dec 31,              Sept 30,           
                                                                2021                  2021                  2021                  2020                 2020               
 Asset Quality:                                                                                                                                                           
 Loans past due over 90 days and still accruing                 $      —              $      —              $      —              $     —              $      —           
 Nonaccrual loans (A)                                                  25,925                5,962                 11,767               11,410                8,611       
 Other real estate owned                                               —                     —                     50                   50                    50          
 Total nonperforming assets                                     $      25,925         $      5,962          $      11,817         $     11,460         $      8,661       
                                                                                                                                                                          
 Nonperforming loans to total loans                                    0.56     %            0.13     %            0.27     %           0.26     %            0.19     %  
 Nonperforming assets to total assets                                  0.42     %            0.10     %            0.20     %           0.19     %            0.15     %  
                                                                                                                                                                          
 Performing TDRs (B)(C)                                         $      416            $      190            $      197            $     201            $      2,278       
                                                                                                                                                                          
 Loans past due 30 through 89 days and still accruing (D)(E)    $      1,193          $      1,678          $      1,622          $     5,053          $      6,609       
                                                                                                                                                                          
 Loans subject to special mention                               $      115,935        $      148,601        $      166,013        $     162,103        $      129,700     
                                                                                                                                                                          
 Classified loans                                               $      51,937         $      11,178         $      25,714         $     37,771         $      41,263      
                                                                                                                                                                          
 Impaired loans                                                 $      26,341         $      6,498          $      11,964         $     16,204         $      15,514      
                                                                                                                                                                          
 Allowance for loan and lease losses:                                                                                                                                     
 Beginning of period                                            $      63,505         $      67,536         $      67,309         $     66,145         $      66,065      
 Provision for loan and lease losses                                   1,600                 900                   225                  2,350                 5,150       
 (Charge-offs)/recoveries, net                                         28                    (4,931   )            2                    (1,186   )            (5,070   )  
 End of period                                                  $      65,133         $      63,505         $      67,536         $     67,309         $      66,145      
                                                                                                                                                                          
 ALLL to nonperforming loans                                           251.24   %            1065.16  %            573.94   %           589.91   %            768.15   %  
 ALLL to total loans                                                   1.42     %            1.39     %            1.52     %           1.53     %            1.48     %  
 General ALLL to total loans (F)                                       1.26     %            1.38     %            1.45     %           1.47     %            1.48     %  

(A) Excludes one commercial loan held for sale of $5.6 million at September
30, 2021, June 30, 2021 and March 31, 2021. Excludes residential and
commercial loans held for sale of $8.5 million at December 31, 2020. 
Excludes one commercial loan held for sale of $10.0 million at September 30,
2020.

(B) Amounts reflect TDRs that are paying according to restructured terms.

(C) Amount excludes $4.0 million at September 30, 2021, $3.9 million at June
30, 2021, $3.9 million at March 31, 2021, $4.0 million at December 31, 2020
and $5.2 million at September 30, 2020 of TDRs included in nonaccrual loans.

(D) Excludes a residential loan held for sale of $93,000 at December 31, 2020.

(E) December 31, 2020 includes $1.3 million of residential loans that are
classified as delinquent due to an escrow payment shortage due to a recent
change in escrow payment requirement.

(F) Total ALLL less specific reserves equals general ALLL.

PEAPACK-GLADSTONE FINANCIAL CORPORATION
SELECTED BALANCE SHEET DATA
(Dollars in Thousands)
(Unaudited)

                                                               September 30,                 December 31,                  September 30,               
                                                               2021                          2020                          2020                        
 Capital Adequacy                                                                                                                                      
 Equity to total assets (A)(J)                                                   8.70   %                      8.95   %                      8.77   %  
 Tangible Equity to tangible assets (B)                                          7.97   %                      8.27   %                      8.16   %  
 Tangible Equity to tangible assets excluding PPP loans (C)                      8.04   %                      8.55   %                      8.45   %  
 Book value per share (D)                                                  $     29.15                   $     27.78                   $     27.62     
 Tangible Book Value per share (E)                                         $     26.50                   $     25.47                   $     25.53     



                                                                   September 30,                           December 31,                          September 30,                     
                                                                   2021                                    2020                                  2020                              
 Regulatory Capital – Holding Company                                                                                                                                              
 Tier I leverage                                                   $    501,188            8.56%           $    483,535            8.53%         $    483,782            8.54%     
 Tier I capital to risk-weighted assets                                 501,188            10.97                483,535            11.93              483,782            11.76     
 Common equity tier I capital ratio to risk-weighted assets             501,159            10.97                483,500            11.93              483,747            11.75     
 Tier I & II capital to risk-weighted assets                            691,044            15.12                716,210            17.67              618,993            15.04     
                                                                                                                                                                                   
 Regulatory Capital – Bank                                                                                                                                                         
 Tier I leverage (F)                                               $    594,610            10.15%          $    549,575            9.71%         $    547,761            9.68%     
 Tier I capital to risk-weighted assets (G)                             594,610            13.01                549,575            13.55              547,761            13.33     
 Common equity tier I capital ratio to risk-weighted assets (H)         594,581            13.01                549,540            13.55              547,726            13.33     
 Tier I & II capital to risk-weighted assets (I)                        651,841            14.26                600,478            14.81              599,314            14.58     

(A) Equity to total assets is calculated as total shareholders’ equity as a
percentage of total assets at period end.

(B) Tangible equity and tangible assets are calculated by excluding the
balance of intangible assets from shareholders’ equity and total assets,
respectively. Tangible equity as a percentage of tangible assets at period end
is calculated by dividing tangible equity by tangible assets at period end. 
See Non-GAAP financial measures reconciliation included in these tables.

(C) Tangible equity and tangible assets excluding PPP loans are calculated by
excluding the balance of intangible assets from shareholders’ equity and
excluding the balance of intangible assets and PPP loans from total assets.
Tangible equity as a percentage of tangible assets excluding PPP loans at
period end is calculated by dividing tangible equity by tangible assets
excluding PPP loans at period end.  See Non-GAAP financial measures
reconciliation included in these tables.

(D) Book value per common share is calculated by dividing shareholders’
equity by period end common shares outstanding

(E) Tangible book value per share excludes intangible assets.  Tangible book
value per share is calculated by dividing tangible equity by period end common
shares outstanding.  See Non-GAAP financial measures reconciliation tables.

(F) Regulatory well capitalized standard = 5.00% ($293 million)

(G) Regulatory well capitalized standard = 8.00% ($366 million)

(H) Regulatory well capitalized standard = 6.50% ($297 million)

(I) Regulatory well capitalized standard = 10.00% ($457 million)

(J) PPP loans with a balance of $49 million at September 30, 2021, $196
million at December 31, 2020 and $202 million at September 30, 2020 increased
total assets.

PEAPACK-GLADSTONE FINANCIAL CORPORATION
LOANS CLOSED
(Dollars in Thousands)
(Unaudited)



                                    For the Quarters Ended                                                                                           
                                    Sept 30,                June 30,                March 31,               Dec 31,                Sept 30,          
                                    2021                    2021                    2021                    2020                   2020              
 Residential loans retained         $      36,845           $      37,083           $      15,814           $     22,316           $      32,599     
 Residential loans sold                    24,041                  25,432                  45,873                 64,630                  54,521     
 Total residential loans                   60,886                  62,515                  61,687                 86,946                  87,120     
 Commercial real estate                    14,944                  12,243                  38,363                 —                       1,613      
 Multifamily                               120,716                 255,820                 85,009                 1,184                   1,500      
 Commercial (C&I) loans (A) (B)            143,121                 141,285                 129,141                218,235                 118,048    
 SBA (C)                                   11,570                  15,976                  58,730                 8,355                   4,962      
 Wealth lines of credit (A)                10,020                  3,200                   2,475                  3,925                   2,000      
 Total commercial loans                    300,371                 428,524                 313,718                231,699                 128,123    
 Installment loans                         178                     25                      63                     690                     253        
 Home equity lines of credit (A)           2,535                   4,140                   1,899                  2,330                   4,759      
 Total loans closed                 $      363,970          $      495,204          $      377,367          $     321,665          $      220,255    



                                    For the Nine Months Ended                           
                                    Sept 30,                        Sept 30,            
                                    2021                            2020                
 Residential loans retained         $      89,742                   $      66,057       
 Residential loans sold                    95,346                          110,973      
 Total residential loans                   185,088                         177,030      
 Commercial real estate                    65,550                          11,219       
 Multifamily                               461,545                         75,458       
 Commercial (C&I) loans (A) (B)            413,547                         260,250      
 SBA (C)                                   86,276                          614,443      
 Wealth lines of credit (A)                15,695                          5,750        
 Total commercial loans                    1,042,613                       967,120      
 Installment loans                         266                             1,459        
 Home equity lines of credit (A)           8,574                           12,671       
 Total loans closed                 $      1,236,541                $      1,158,280    

(A) Includes loans and lines of credit that closed in the period but not
necessarily funded.

(B) Includes equipment finance.

(C) Includes PPP loans of $9.2 million for the quarter ended June 30, 2021,
$47 million for the quarter ended March 31, 2021 and $596 million for the nine
months ended September 30, 2020.

PEAPACK-GLADSTONE FINANCIAL CORPORATION
AVERAGE BALANCE SHEET
UNAUDITED
THREE MONTHS ENDED
(Tax-Equivalent Basis, Dollars in Thousands)

                                                 September 30, 2021                                             September 30, 2020                                           
                                                 Average                  Income/                               Average                  Income/                             
                                                 Balance                  Expense               Yield           Balance                  Expense               Yield         
 ASSETS:                                                                                                                                                                     
 Interest-earning assets:                                                                                                                                                    
 Investments:                                                                                                                                                                
 Taxable (A)                                     $     820,574            $     2,824                1.38  %    $     553,607            $     2,182                1.58  %  
 Tax-exempt (A) (B)                                    6,035                    64                   4.24             9,127                    116                  5.08     
                                                                                                                                                                             
 Loans (B) (C):                                                                                                                                                              
 Mortgages                                             503,621                  3,779                3.00             529,500                  4,437                3.35     
 Commercial mortgages                                  2,133,259                16,114               3.02             1,929,319                15,115               3.13     
 Commercial                                            1,826,368                16,553               3.63             2,134,399                17,653               3.31     
 Commercial construction                               24,596                   198                  3.22             4,395                    55                   5.01     
 Installment                                           32,219                   245                  3.04             52,659                   377                  2.86     
 Home equity                                           43,182                   357                  3.31             53,373                   444                  3.33     
 Other                                                 252                      5                    7.94             283                      7                    9.89     
 Total loans                                           4,563,497                37,251               3.27             4,703,928                38,088               3.24     
 Federal funds sold                                    —                        —                    —                102                      —                    0.25     
 Interest-earning deposits                             413,623                  142                  0.14             652,832                  159                  0.10     
 Total interest-earning assets                         5,803,729                40,281               2.78  %          5,919,596                40,545               2.74  %  
 Noninterest-earning assets:                                                                                                                                                 
 Cash and due from banks                               8,592                                                          7,479                                                  
 Allowance for loan and lease losses                   (64,100    )                                                   (68,110    )                                           
 Premises and equipment                                23,311                                                         21,511                                                 
 Other assets                                          201,287                                                        242,017                                                
 Total noninterest-earning assets                      169,090                                                        202,897                                                
 Total assets                                    $     5,972,819                                                $     6,122,493                                              
                                                                                                                                                                             
 LIABILITIES:                                                                                                                                                                
 Interest-bearing deposits:                                                                                                                                                  
 Checking                                        $     2,098,827          $     1,177                0.22  %    $     1,828,780          $     1,130                0.25  %  
 Money markets                                         1,257,760                683                  0.22             1,235,040                920                  0.30     
 Savings                                               152,759                  20                   0.05             125,016                  16                   0.05     
 Certificates of deposit – retail                      461,917                  836                  0.72             642,732                  2,529                1.57     
 Subtotal interest-bearing deposits                    3,971,263                2,716                0.27             3,831,568                4,595                0.48     
 Interest-bearing demand – brokered                    85,000                   385                  1.81             130,000                  636                  1.96     
 Certificates of deposit – brokered                    33,796                   266                  3.15             33,742                   267                  3.17     
 Total interest-bearing deposits                       4,090,059                3,367                0.33             3,995,310                5,498                0.55     
 Borrowings                                            64,332                   57                   0.35             475,465                  1,221                1.03     
 Capital lease obligation                              6,147                    74                   4.82             7,054                    84                   4.76     
 Subordinated debt                                     132,588                  1,358                4.10             83,552                   1,222                5.85     
 Total interest-bearing liabilities                    4,293,126                4,856                0.45  %          4,561,381                8,025                0.70  %  
 Noninterest-bearing liabilities:                                                                                                                                            
 Demand deposits                                       997,450                                                        872,560                                                
 Accrued expenses and other liabilities                137,387                                                        173,816                                                
 Total noninterest-bearing liabilities                 1,134,837                                                      1,046,376                                              
 Shareholders’ equity                                  544,856                                                        514,736                                                
 Total liabilities and shareholders’ equity      $     5,972,819                                                $     6,122,493                                              
 Net interest income                                                      $     35,425                                                   $     32,520                        
 Net interest spread                                                                                 2.33  %                                                        2.04  %  
 Net interest margin (D)                                                                             2.42  %                                                        2.20  %  

(A) Average balances for available for sale securities are based on amortized
cost.

(B) Interest income is presented on a tax-equivalent basis using a 21% federal
tax rate.

(C) Loans are stated net of unearned income and include nonaccrual loans.

(D) Net interest income on a tax-equivalent basis as a percentage of total
average interest-earning assets.

PEAPACK-GLADSTONE FINANCIAL CORPORATION
AVERAGE BALANCE SHEET
UNAUDITED
THREE MONTHS ENDED
(Tax-Equivalent Basis, Dollars in Thousands)

                                                 September 30, 2021                                             June 30, 2021                                                
                                                 Average                  Income/                               Average                  Income/                             
                                                 Balance                  Expense               Yield           Balance                  Expense               Yield         
 ASSETS:                                                                                                                                                                     
 Interest-earning assets:                                                                                                                                                    
 Investments:                                                                                                                                                                
 Taxable (A)                                     $     820,574            $     2,824                1.38  %    $     884,374            $     3,020                1.37  %  
 Tax-exempt (A) (B)                                    6,035                    64                   4.24             6,891                    81                   4.70     
                                                                                                                                                                             
 Loans (B) (C):                                                                                                                                                              
 Mortgages                                             503,621                  3,779                3.00             498,594                  3,826                3.07     
 Commercial mortgages                                  2,133,259                16,114               3.02             1,941,330                15,056               3.10     
 Commercial                                            1,826,368                16,553               3.63             1,942,802                16,984               3.50     
 Commercial construction                               24,596                   198                  3.22             20,952                   180                  3.44     
 Installment                                           32,219                   245                  3.04             34,319                   255                  2.97     
 Home equity                                           43,182                   357                  3.31             45,042                   377                  3.35     
 Other                                                 252                      5                    7.94             219                      5                    9.13     
 Total loans                                           4,563,497                37,251               3.27             4,483,258                36,683               3.27     
 Federal funds sold                                    —                        —                    —                91                       —                    0.06     
 Interest-earning deposits                             413,623                  142                  0.14             428,464                  97                   0.09     
 Total interest-earning assets                         5,803,729                40,281               2.78  %          5,803,078                39,881               2.75  %  
 Noninterest-earning assets:                                                                                                                                                 
 Cash and due from banks                               8,592                                                          10,360                                                 
 Allowance for loan and lease losses                   (64,100    )                                                   (67,593    )                                           
 Premises and equipment                                23,311                                                         23,307                                                 
 Other assets                                          201,287                                                        182,421                                                
 Total noninterest-earning assets                      169,090                                                        148,495                                                
 Total assets                                    $     5,972,819                                                $     5,951,573                                              
                                                                                                                                                                             
 LIABILITIES:                                                                                                                                                                
 Interest-bearing deposits:                                                                                                                                                  
 Checking                                        $     2,098,827          $     1,177                0.22  %    $     1,980,688          $     944                  0.19  %  
 Money markets                                         1,257,760                683                  0.22             1,235,464                727                  0.24     
 Savings                                               152,759                  20                   0.05             144,044                  18                   0.05     
 Certificates of deposit – retail                      461,917                  836                  0.72             488,148                  1,027                0.84     
 Subtotal interest-bearing deposits                    3,971,263                2,716                0.27             3,848,344                2,716                0.28     
 Interest-bearing demand – brokered                    85,000                   385                  1.81             105,604                  456                  1.73     
 Certificates of deposit – brokered                    33,796                   266                  3.15             33,783                   264                  3.13     
 Total interest-bearing deposits                       4,090,059                3,367                0.33             3,987,731                3,436                0.34     
 Borrowings                                            64,332                   57                   0.35             166,343                  182                  0.44     
 Capital lease obligation                              6,147                    74                   4.82             6,380                    76                   4.76     
 Subordinated debt                                     132,588                  1,358                4.10             181,317                  2,147                4.74     
 Total interest-bearing liabilities                    4,293,126                4,856                0.45  %          4,341,771                5,841                0.54  %  
 Noninterest-bearing liabilities:                                                                                                                                            
 Demand deposits                                       997,450                                                        948,851                                                
 Accrued expenses and other liabilities                137,387                                                        129,980                                                
 Total noninterest-bearing liabilities                 1,134,837                                                      1,078,831                                              
 Shareholders’ equity                                  544,856                                                        530,971                                                
 Total liabilities and shareholders’ equity      $     5,972,819                                                $     5,951,573                                              
 Net interest income                                                      $     35,425                                                   $     34,040                        
 Net interest spread                                                                                 2.33  %                                                        2.21  %  
 Net interest margin (D)                                                                             2.42  %                                                        2.38  %  

(A) Average balances for available for sale securities are based on amortized
cost.

(B) Interest income is presented on a tax-equivalent basis using a 21% federal
tax rate.

(C) Loans are stated net of unearned income and include nonaccrual loans.

(D) Net interest income on a tax-equivalent basis as a percentage of total
average interest-earning assets.

PEAPACK-GLADSTONE FINANCIAL CORPORATION
AVERAGE BALANCE SHEET
UNAUDITED
NINE MONTHS ENDED
(Tax-Equivalent Basis, Dollars in Thousands)

                                                 September 30, 2021                                              September 30, 2020                                            
                                                 Average                  Income/                                Average                  Income/                              
                                                 Balance                  Expense                Yield           Balance                  Expense                Yield         
 ASSETS:                                                                                                                                                                       
 Interest-earning assets:                                                                                                                                                      
 Investments:                                                                                                                                                                  
 Taxable (A)                                     $     822,262            $     8,473                 1.37  %    $     467,881            $     6,749                 1.92  %  
 Tax-exempt (A) (B)                                    6,961                    243                   4.65             9,930                    376                   5.05     
                                                                                                                                                                               
 Loans (B) (C):                                                                                                                                                                
 Mortgages                                             501,276                  11,559                3.07             531,563                  13,510                3.39     
 Commercial mortgages                                  1,972,723                45,590                3.08             1,989,256                49,745                3.33     
 Commercial                                            1,900,231                49,992                3.51             1,977,597                54,450                3.67     
 Commercial construction                               20,418                   516                   3.37             4,440                    187                   5.62     
 Installment                                           34,724                   777                   2.98             53,165                   1,212                 3.04     
 Home equity                                           45,672                   1,133                 3.31             54,627                   1,512                 3.69     
 Other                                                 239                      15                    8.37             321                      23                    9.55     
 Total loans                                           4,475,283                109,582               3.26             4,610,969                120,639               3.49     
 Federal funds sold                                    64                       —                     0.13             102                      —                     0.25     
 Interest-earning deposits                             465,287                  367                   0.11             468,064                  820                   0.23     
 Total interest-earning assets                         5,769,857                118,665               2.74  %          5,556,946                128,584               3.09  %  
 Noninterest-earning assets:                                                                                                                                                   
 Cash and due from banks                               10,018                                                          6,149                                                   
 Allowance for loan and lease losses                   (67,592    )                                                    (58,896    )                                            
 Premises and equipment                                23,087                                                          21,373                                                  
 Other assets                                          203,344                                                         212,716                                                 
 Total noninterest-earning assets                      168,857                                                         181,342                                                 
 Total assets                                    $     5,938,714                                                 $     5,738,288                                               
                                                                                                                                                                               
 LIABILITIES:                                                                                                                                                                  
 Interest-bearing deposits:                                                                                                                                                    
 Checking                                        $     1,996,663          $     3,099                 0.21  %    $     1,706,558          $     6,219                 0.49  %  
 Money markets                                         1,250,933                2,204                 0.23             1,211,720                5,374                 0.59     
 Savings                                               140,066                  55                    0.05             118,291                  47                    0.05     
 Certificates of deposit – retail                      494,255                  3,333                 0.90             672,308                  9,370                 1.86     
 Subtotal interest-bearing deposits                    3,881,917                8,691                 0.30             3,708,877                21,010                0.76     
 Interest-bearing demand – brokered                    100,110                  1,334                 1.78             153,358                  2,259                 1.96     
 Certificates of deposit – brokered                    33,783                   791                   3.12             33,729                   794                   3.14     
 Total interest-bearing deposits                       4,015,810                10,816                0.36             3,895,964                24,063                0.82     
 Borrowings                                            138,448                  448                   0.43             330,324                  3,360                 1.36     
 Capital lease obligation                              6,376                    229                   4.79             7,266                    261                   4.79     
 Subordinated debt                                     165,053                  5,650                 4.56             83,496                   3,667                 5.86     
 Total interest-bearing liabilities                    4,325,687                17,143                0.53  %          4,317,050                31,351                0.97  %  
 Noninterest-bearing liabilities:                                                                                                                                              
 Demand deposits                                       932,088                                                         763,414                                                 
 Accrued expenses and other liabilities                143,045                                                         149,187                                                 
 Total noninterest-bearing liabilities                 1,075,133                                                       912,601                                                 
 Shareholders’ equity                                  533,894                                                         508,637                                                 
 Total liabilities and shareholders’ equity      $     5,934,714                                                 $     5,738,288                                               
 Net interest income                                                      $     101,522                                                   $     97,233                         
 Net interest spread                                                                                  2.21  %                                                         2.12  %  
 Net interest margin (D)                                                                              2.35  %                                                         2.33  %  

(A) Average balances for available for sale securities are based on amortized
cost.

(B) Interest income is presented on a tax-equivalent basis using a 21% federal
tax rate.

(C) Loans are stated net of unearned income and include nonaccrual loans.

(D) Net interest income on a tax-equivalent basis as a percentage of total
average interest-earning assets.

PEAPACK-GLADSTONE FINANCIAL CORPORATION
NON-GAAP FINANCIAL MEASURES RECONCILIATION

Tangible book value per share and tangible equity as a percentage of tangible
assets at period end are non-GAAP financial measures derived from GAAP-based
amounts.  We calculate tangible equity and tangible assets by excluding the
balance of intangible assets from shareholders’ equity and total assets,
respectively.  We calculate tangible book value per share by dividing
tangible equity by period end common shares outstanding, as compared to book
value per common share, which we calculate by dividing shareholders’ equity
by period end common shares outstanding.  We calculate tangible equity as a
percentage of tangible assets at period end by dividing tangible equity by
tangible assets at period end.  We believe that this is consistent with the
treatment by bank regulatory agencies, which exclude intangible assets from
the calculation of risk-based capital ratios.

The efficiency ratio is a non-GAAP measure of expense control relative to
recurring revenue.  We calculate the efficiency ratio by dividing total
noninterest expenses, excluding other real estate owned provision, as
determined under GAAP, by net interest income and total noninterest income as
determined under GAAP, but excluding net gains/(losses) on loans held for sale
at lower of cost or fair value and excluding net gains on securities from this
calculation, which we refer to below as recurring revenue.  We believe that
this provides a reasonable measure of core expenses relative to core revenue.

We believe that these non-GAAP financial measures provide information that is
important to investors and that is useful in understanding our financial
position, results and ratios.  Our management internally assesses our
performance based, in part, on these measures.  However, these non-GAAP
financial measures are supplemental and are not a substitute for an analysis
based on GAAP measures.  As other companies may use different calculations
for these measures, this presentation may not be comparable to other similarly
titles measures reported by other companies.  A reconciliation of the
non-GAAP measures of tangible common equity, tangible book value per share and
efficiency ratio to the underlying GAAP numbers is set forth below.

(Dollars in thousands, except share data)

                                                           Three Months Ended                                                                                                               
                                                           Sept 30,                   June 30,                   March 31,                  Dec 31,                   Sept 30,              
 Tangible Book Value Per Share                             2021                       2021                       2021                       2020                      2020                  
 Shareholders’ equity                                      $      543,014             $      538,459             $      522,441             $     527,122             $      522,728        
 Less: Intangible assets, net                                     49,333                     43,156                     43,524                    43,891                     39,622         
 Tangible equity                                                  493,681                    495,303                    478,917                   483,231                    483,106        
                                                                                                                                                                                            
 Period end shares outstanding                                    18,627,910                 18,829,877                 19,034,870                18,974,703                 18,924,953     
 Tangible book value per share                             $      26.50               $      26.30               $      25.16               $     25.47               $      25.53          
 Book value per share                                             29.15                      28.60                      27.45                     27.78                      27.62          
                                                                                                                                                                                            
 Tangible Equity to Tangible Assets                                                                                                                                                         
 Total assets                                              $      6,240,285           $      5,791,688           $      5,969,627           $     5,890,442           $      5,958,107      
 Less: Intangible assets, net                                     49,333                     43,156                     43,524                    43,891                     39,622         
 Tangible assets                                                  6,190,952                  5,748,532                  5,926,103                 5,846,551                  5,918,485      
 Less: PPP Loans                                                  48,721                     83,766                     232,721                   195,574                    201,991        
 Tangible Assets excluding PPP Loans                              6,142,231                  5,664,766                  5,693,382                 5,650,977                  5,716,494      
 Tangible equity to tangible assets                               7.97        %              8.62        %              8.08        %             8.27        %              8.16        %  
 Tangible equity to tangible assets excluding PPP loans           8.04        %              8.74        %              8.41        %             8.55        %              8.45        %  
 Equity to assets (A)                                             8.70        %              9.30        %              8.75        %             8.95        %              8.77        %  

(A) Equity to total assets would be 8.77% if PPP loans of $47 million were
excluded from total assets as of September 30, 2021. Equity to total assets
would be 9.43% if PPP loans of $84 million were excluded from total assets as
of June 30, 2021. Equity to total assets would be 9.11% if PPP loans of $233
million were excluded from total assets of March 31, 2021. Equity to total
assets would be 9.26% if PPP loans of $196 million were excluded from total
assets as of December 31, 2020. Equity to total assets would be 9.08% if PPP
loans of $202 million were excluded from total assets as of September 30,
2020.



                                             Three Months Ended                                                                                                
                                             Sept 30,                June 30,                March 31,               Dec 31,                Sept 30,           
 Return on Average Tangible Equity           2021                    2021                    2021                    2020                   2020               
 Net income                                  $      14,171           $      14,418           $      13,178           $     3,030            $      13,547      
                                                                                                                                                               
 Average shareholders’ equity                $      544,856          $      530,971          $      525,643          $     523,446          $      514,736     
 Less: Average intangible assets, net               48,757                  43,366                  43,742                 40,336                  39,811      
 Average tangible equity                            496,099                 487,605                 481,901                483,110                 474,925     
                                                                                                                                                               
 Return on average tangible common equity           11.43    %              11.83    %              10.94    %             2.51     %              11.41    %  



                                             For the Nine Months Ended                        
                                             Sept 30,                      Sept 30,           
 Return on Average Tangible Equity           2021                          2020               
 Net income                                  $      41,767                 $      23,162      
                                                                                              
 Average shareholders’ equity                $      533,894                $      508,637     
 Less: Average intangible assets, net               45,306                        40,135      
 Average tangible equity                            488,588                       468,502     
                                                                                              
 Return on average tangible common equity           11.40    %                    6.59     %  



                                            Three Months Ended                                                                                           
                                            Sept 30,               June 30,               March 31,              Dec 31,               Sept 30,          
 Efficiency Ratio                           2021                   2021                   2021                   2020                  2020              
 Net interest income                        $      35,211          $      33,845          $      31,793          $     31,735          $      32,149     
 Total other income                                17,781                 17,678                 17,820                14,406                 20,211     
 Add:                                                                                                                                                    
 Securities (gains)/losses, net                    70                     (42     )              265                   42                     —          
 Less:                                                                                                                                                   
 Loss/(gain) on loans held for sale                                                                                                                      
 at lower of cost or fair value                    —                      (1,125  )              (282    )             —                      (7,429  )  
 Income from life insurance proceeds               —                      (153    )              (302    )             —                      —          
 Loss/(gain) on swap termination                   —                      842                    —                     —                      —          
 Total recurring revenue                           53,062                 51,045                 49,294                46,183                 44,931     
                                                                                                                                                         
 Operating expenses                                32,185                 30,684                 31,594                39,249                 28,461     
 Less:                                                                                                                                                   
 FHLB prepayment penalty                           —                      —                      —                     4,784                  —          
 Valuation allowance loans held for sale           —                      —                      —                     4,425                  —          
 Write-off of subordinated debt costs              —                      648                    —                     —                      —          
 Swap valuation allowance                          1,350                  —                      —                     —                      —          
 Severance expense                                 —                      —                      1,532                 —                      —          
 Total operating expense                           30,835                 30,036                 30,062                30,040                 28,461     
                                                                                                                                                         
 Efficiency ratio                                  58.11   %              58.84   %              60.99   %             65.05   %              63.34   %  



                                         For the Nine Months Ended                        
                                         Sept 30,                      Sept 30,           
 Efficiency Ratio                        2021                          2020               
 Net interest income                     $      100,849                $      95,867      
 Total other income                             53,279                        47,354      
 Add:                                                                                     
 Securities (gains)/losses, net                 293                           (323     )  
 Less:                                                                                    
 Loss/(gain) on swap termination                842                           —           
 Income from life insurance proceeds            (455     )                    —           
 Loss/(gain) on loans held for sale                                                       
 at lower of cost or fair value                 (1,407   )                    (7,426   )  
 Total recurring revenue                        153,401                       135,472     
                                                                                          
 Operating expenses                             94,463                        85,710      
 Less:                                                                                    
 Write-off of subordinated debt costs           648                           —           
 Swap valuation allowance                       1,350                         —           
 Severance expense                              1,532                         —           
 Total operating expense                        90,933                        85,710      
                                                                                          
 Efficiency ratio                               59.28    %                    63.27    %  



Contact:

Jeffrey J. Carfora, SEVP and CFO

Peapack-Gladstone Financial Corporation

T: 908-719-4308
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