February 1, 2024

Dear Marine Shareholders:

I am pleased to announce that Marine Bank continues to be the bank of choice in the communities we serve. Our team of outstanding bankers work diligently to offer banking solutions to meet the specific needs of local businesses and individuals. Thanks to their efforts, client loyalty has surged – even in these challenging times.

Our financial performance has been recognized by Bauer Financial, the premier bank-rating organization, with a 4-Stars, Excellent rating. The financial results below are for Marine Bank’s parent, Marine Bancorp of Florida, Inc.

Year Ended December 31, 2023 Financial Summary:

million $

Year Ended 12/31/2023

Year Ended 12/31/2022

% change

Net Income




Total Assets




million $

Total Loans




Total Deposits




Total Checking + NOW



- 14%


Marine Bancorp Tangible Book Value Per Common Share




Earnings Per Share




Return on Shareholders’ Equity




Return on Shareholders’ Equity, pre-AOCI adjustment




million $

Non-Performing Assets




Quarter Over Quarter 2023 Financial Summary:.

million $

Quarter Ended


Quarter Ended 9/30/2023

Quarter Ended 6/30/2023

Quarter Ended 3/31/2023

Quarterly Net Income





Total Assets





million $

Total Loans





Total Deposits





Total Checking + NOW






Year-to-Date Earnings Per Share





Financial Results

Net income for the year ending December 31, 2023 was $4.614 million, down from $5.381 million from the previous year, a 14% year-over-year decrease. The decrease in earnings is due primarily to the rising interest rate environment and the resulting increasing cost of funds (our interest expense increased faster than our interest income). The interest rate increases, also significantly slowed housing sales, thus negatively impacting our residential loan origination business.

The $1.231 million decrease in net interest income was offset primarily by a $700,000 decrease in provision for loan loss expenses.

The net income of the fourth quarter of 2023 is down slightly from the net income of the third quarter of 2023 due to slowing loan growth, reduced secondary mortgage loan sale income and the increasing cost of funds and increasing expenses.

Asset and Loan Growth

Total Assets increased $18 million, or 3%, from December 2022 to December 2023. Total Loans grew $30 million or 7% during the same period.

This growth rate improved in the fourth quarter of 2023 compared to the third quarter of 2023 as Total Assets increased $15 million and Total Loans increased $12 million quarter over quarter.

Helping to facilitate our clients’ financial dreams is the most rewarding part of our business. In 2023, Marine Bank originated the following number of loans:

  • 122 Residential Real Estate Mortgages  
  • 7 Consumer Loans and
  • 113 Commercial Real Estate and Business Loans  

While these are nice numbers for a shareholder’s letter, each loan is a personal success story of a new home, a new or expanding business creating jobs for our residents or a new investment to set up the client for a comfortable retirement. We take this social responsibility very seriously.

Deposit Growth

Total deposits as of December 31, 2023, were $583 million compared to $577 million the same time last year, an increase of $6 million or 1%. The deposit mix is changing as clients seek a higher return on their deposits. We have seen a 14% reduction in the aggregate balances of lower cost demand deposit accounts as they have migrated to money market accounts and substantial growth of $42 million in higher rate certificates of deposit.

We continue to attract new clients to our popular business and personal checking accounts due to our outstanding personal service and technological conveniences. In 2023 we added 1,249 new checking accounts. Continued core deposit growth and controlling our cost of funds were our primary challenges in 2023 and will continue into 2024. This is where our deposit base of 44% in checking accounts benefits our shareholders.

Our new clients typically come to us seeking relief from the big non-personal banks and they are delighted to experience the Marine Bank difference.

Given the banking circumstances last year, our clients are very conscious of FDIC insurance and our Marine Bank Team is adept at helping them structure their deposits to gain the maximum possible insurance coverage. Additionally, we offer a reciprocal deposit service that helps our clients obtain FDIC insurance into the millions of dollars. If you have any questions, please let us know how we can help you.

Credit Quality

Credit quality continues to be very strong. As of December 31, 2023, we had one loan on non-accrual with a balance of $1.4 million and no loss expected. We continue to add to our reserve for loan losses and it is a healthy 1.44% of gross loans.


For the year ending December 31, 2023, Return on Shareholders’ Equity (ROE), prior to the AOCI adjustment, was 9.09% as compared to 11.92% for the same period ended December 31, 2022. Earnings per share were $2.52, versus $2.96 for the same period in 2022, a decrease of $0.44 per share or 15%.

Profitability was lower in the fourth quarter of 2023 versus the third quarter of 2023 due to the increasing cost of funds, as noted above.

Common Stock Book Value

The common stock tangible book value increased to $19.99 per share on December 31, 2023, from $15.33 in the same period last year, an increase of 30%. As the previous shareholder letter mentioned, rising interest rates have caused book value reductions in the Bank’s investment portfolio. These unrealized losses, also referred to as AOCI, are reflected as a reduction in equity, resulting in changes to the tangible book value calculation. Year over year, saw a modest $3.8 million improvement in the recorded AOCI.

The inclusion of the AOCI losses (or mark-to-market value) on one segment of the balance sheet is a GAAP accounting requirement. This requirement excludes loans, which is our biggest income source, any appreciated real estate and the entire liability and funding side of the balance sheet. If deposits were included, Marine’s deposit book of 44% checking accounts, would significantly increase in value as rates rise, given that they are a zero-rate cost funding source. We, of course, follow the accounting rules, but I hope this puts the decline in value per share into perspective.

The Current Economic Environment

This year continues to be challenging. The economy constantly sends mixed signals, e.g., low unemployment with reducing but still relatively high inflation. Housing sales volume is declining but prices are stable. The
Federal Reserve seems poised to lower interest rates to maintain economic growth while attempting to restrain inflation but from our lens consumers are suffering an affordability shock that will ultimately curtail spending. Can the Fed achieve the desired soft landing, or do they overshoot and create a recession? We are preparing the Bank for either outcome.

Meanwhile, the Florida economy continues to chug along, seemingly ignoring the national trends. As the only community bank headquartered in the growing Central East Coast Florida market, we believe that Marine Bank is in a strong position to benefit from the growth in these communities.

New Board Chairman

In order to better position Marine for the future, your Board of Directors decided to separate the CEO and Board Chair positions. Accordingly, in January Dan Richey was elected the Non-Executive Chairman of the Board of both for Marine Bank and Marine Bancorp of Florida, Inc. Please join us in welcoming Dan to this position.

Marine Bancorp of Florida, Inc. Annual Meeting

The annual meeting for Marine Bancorp of Florida, Inc. will be held on Wednesday, April 24th at 4:30 pm at Marine Bank at 571 Beachland Boulevard, Vero Beach. Please mark your calendars. The proxy materials will be sent out in March.

Marine Stock Trading

Your Marine Bancorp of Florida stock is listed on the OTC market under the ticker symbol of MBOF. If you have any questions or inquiries regarding buying, selling or your current ownership in Marine Bank, please contact Michael Acampora of D.A. Davidson, a banking industry specialist in providing market making services at (904) 456-6153 or macampora@dadco.com. 

Wealth Management

The new year is the perfect time to evaluate your financial goals. Through our partnership with Warren Capital Management, led by Sue Tompkins, a local and highly skilled investment advisor, Marine Bank’s clients have access to financial planning, investment management, trust, and estate services.  If you have not already done so, please contact us at (772) 231-6611 to set up an appointment to review your portfolio and investment goals.

What You Can Do

Never before have your referrals been so critical. With more than 99% of service survey respondents saying they would recommend Marine Bank, you can be confident in recommending your friends, family and business associates.  Rest assured that we will exceed their expectations.

As always, please follow our social media pages on Facebook and LinkedIn. They provide value-added banking and financial related information and news about your Bank. Your “likes” and “shares” are important, so please follow us!

Sincerely yours,

Bill Penney Signature                                                                                                               

William J. Penney
President, CEO & Chairman

Dan Richey Signature

Daniel R. Richey
Chairman of the Board