Adrian JohnsonTLDR:
- Primis Financial Corp to restate financials due to loan accounting errors
- Identified errors in the accounting methodology for a portfolio of consumer loans
Article Summary:
Primis Financial Corp, a commercial bank holding company, has announced that its financial statements for the year ended December 31, 2022, should not be relied upon due to loan accounting errors. The company will be restating its financials to correct errors in the application of U.S. GAAP, which includes deferring interest income on consumer loans, derecognizing credit enhancement income, and discontinuing certain recordings. As a result of these errors, a material weakness in internal controls over financial reporting has been identified. In addition, the company is facing Nasdaq delinquency issues and has been granted an extension to file overdue reports.
On a positive note, Primis Financial Corp reported strong Q2 earnings, showing a significant improvement from the previous year. The company’s total loans and deposits have also increased. Analysts predict future expenses to remain stable, and the company is planning to deconsolidate PFH to enhance its tangible book value and capital ratios.
Insights from InvestingPro indicate that Primis Financial Corp has a market capitalization of $276.44 million with a P/E ratio of 13.11 and has shown revenue growth of 19.1%. Analysts have revised earnings upwards, suggesting potential profitability this year. The company also has a consistent dividend yield of 3.54% over 13 years, which may appeal to income-focused investors.
While the company is dealing with accounting issues and Nasdaq delinquency, it still shows promise in terms of financial health and market position, according to InvestingPro.
