GlobeNewswire Inc | Jul 28, 2021 09:00AM EDT

July 28, 2021

Bedminster, NJ, July 28, 2021 (GLOBE NEWSWIRE) -- via NewMediaWire -- Peapack-Gladstone Financial Corporation (NASDAQ Global Select Market: PGC) (the Company) announces its second quarter 2021 results.

This earnings release should be read in conjunction with the Companys Q2 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 six months ended June 30, 2021, the Company recorded total revenue of $101.14 million, net income of $27.60 million and diluted earnings per share (EPS) of $1.42 compared to $90.87 million, $9.62 million and $0.51, respectively, for the same six-month period ended June 30, 2020.

For the quarter ended June 30, 2021, the Company recorded total revenue of $51.52 million, net income of $14.42 million and diluted earnings per share (EPS) of $0.74, compared to $44.59 million, $8.24 million and $0.43, respectively, for the same three-month period ended June 30, 2020.

The quarter ended June 30, 2021 included increased noninterest income, principally wealth management income and income from capital markets activities (which includes mortgage banking income, loan level back-to-back swap income, SBA loan income, and corporate advisory fee income) when compared to the same quarter in 2020. The 2021 quarter also included a significantly reduced provision for loan losses when compared to the same quarter last year. The decreased provision in the June 2021 quarter was 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 June 2021 quarter included a $1.13 million gain on the sale of Paycheck Protection Program (PPP) loans; fee income of $722,000 relating to PPP loan referrals to a third party; and $153,000 of additional BOLI income related to receipt of life insurance proceeds. These positives were substantially offset by a $842,000 cost (included as a negative to noninterest income) related to the termination of two interest rate swaps, and $648,000 of accelerated expense related to the prepayment of $50.0 million of subordinated notes. Both actions will have a positive impact on earnings going forward.

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 second quarter of 2021 the Company purchased 234,722 shares at an average price of $32.40 for a total cost of $7.60 million under this program. Since announced, the Company has purchased 392,755 shares at an average price of $30.51 for a total cost of $11.98 million under this program.

Douglas L. Kennedy, President and CEO, said, Our capital is strong and we believe that purchasing the Companys stock is an opportunity for us to effectively manage our excess capital, while taking advantage of the Companys valuation relative to peers.

Mr. Kennedy also said, During 2021 the Company participated in the 2021 round of the PPP, which provided much needed funding to qualifying small businesses and organizations. During the six months of 2021 we assisted with over $181 million of PPP loans - $57 million processed and funded by the Bank, and another $124 million referred directly to a third party for processing and funding. During the second quarter, the Company sold the $57 million of loans to the same third party to create additional capacity to process our strong loan pipeline.

EXECUTIVE SUMMARY:

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

June 2021 Year Compared to Prior Year

Six Six Months Months Ended Ended June30, June30, Increase/ (Dollars inmillions, 2021 2020 (Decrease) except pershare data)Net interest $ 65.64 $ 63.72 $ 1.92 3 %incomeWealthmanagement fee 25.17 19.95 5.22 26 income (A)Capital markets 5.03 3.85 1.18 31 activity (B)Other income 5.30 3.35 1.95 58 (C)Total other 35.50 27.15 8.35 31 incomeOperating 62.28 57.25 5.03 9 expenses (D)Pretax incomebefore 38.86 33.62 5.24 16 provision forloan lossesProvision forloan and lease 1.13 24.90 (23.77 ) (95 )losses (E)Pretax income 37.73 8.72 29.01 333 Income taxexpense/ 10.13 (0.90 ) 11.03 N/A (benefit) (F)Net income $ 27.60 $ 9.62 $ 17.98 187 %Diluted EPS $ 1.42 $ 0.51 $ 0.91 178 % Total Revenue $ 101.14 $ 90.87 $ 10.27 11 %(G) Return onaverage assets 0.93 % 0.35 % 0.58 annualizedReturn onaverage equity 10.45 % 3.80 % 6.65 annualized

-- The June 2021 six months included wealth management fee income and expense related to the December lift outs of teams from Lucas Capital Management (Lucas) and Noyes Capital Management (Noyes) - approximately $1.2 million of wealth management fee income and approximately $700,000 of operating expenses were recorded in 2021 from these teams. -- Capital markets activity includes loan level back-to-back swap activities, the SBA lending and sale program, corporate advisory activities and mortgage banking activities. There were no fees related to loan level back-to-back swap activities in the six months ended June 30, 2021, compared to $1.6 million in the same 2020 period. The three months ended March 31, 2021 included $1.1 million of corporate advisory fee income related to a large investment banking advisory event which closed in that quarter. -- Included a cost of $842,000 related to the termination of interest rate swaps; $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 2021 six months included $1.5 million of severance expense related to certain corporate restructuring within several areas of the Bank and $648,000 of expense related to the redemption of subordinated debt. -- The 2020 year included a provision for loan and lease losses of $24.9 million, primarily due to the environment at that time created by the COVID-19 pandemic. -- The 2020 year 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. -- Total revenue equals net interest income plus total other income.

June 2021 Quarter Compared to Prior Year Quarter

Three Three Months Months Ended Ended June30, June30, Increase/ (Dollars inmillions, except 2021 2020 (Decrease) per share data)Net interest $ 33.85 $ 31.97 $ 1.88 6 %incomeWealthmanagement fee 13.03 10.00 3.03 30 income (A)Capital markets 1.46 1.08 0.38 35 activity (B)Other income (C) 3.18 1.54 1.64 106 Total other 17.67 12.62 5.05 40 incomeOperating 30.68 29.01 1.67 6 expenses (D)Pretax incomebefore provision 20.84 15.58 5.26 34 for loan lossesProvision forloan and lease 0.90 4.90 (4.00 ) (82 )losses (E)Pretax income 19.94 10.68 9.26 87 Income tax 5.52 2.44 3.08 126 expenseNet income $ 14.42 $ 8.24 $ 6.18 75 %Diluted EPS $ 0.74 $ 0.43 $ 0.31 72 % Total Revenue $ 51.52 $ 44.59 $ 6.93 16 %(F) Return onaverage assets 0.97 % 0.56 % 0.41 annualizedReturn onaverage equity 10.86 % 6.56 % 4.30 annualized

-- The June 2021 quarter included a full quarter of wealth management fee income and expense related to the December lift outs of teams from Lucas and Noyes - approximately $625,000 of wealth management fee income and approximately $350,000 of operating expenses were recorded in the 2021 quarter. -- Capital markets activity includes loan level back-to-back swap activities, the SBA lending and sale program, corporate advisory activities, and mortgage banking activities. -- The quarter ended June 30, 2021 included a cost of $842,000 related to the termination of certain 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. -- The June 2021 quarter includes $648,000 of expense related to the redemption of subordinated debt. -- The June 2020 quarter included a provision for loan and lease losses of $4.9 million, primarily due to the environment at that time created by the COVID-19 pandemic. -- Total revenue equals net interest income plus total other income.

June 2021 Quarter Compared to Linked Quarter

Three Three Months Months Ended Ended June30, March31, Increase/ (Dollars inmillions, 2021 2021 (Decrease) except pershare data)Net interest $ 33.85 $ 31.79 $ 2.06 6 %incomeWealthmanagement fee 13.03 12.13 0.90 7 incomeCapital markets 1.46 3.57 (2.11 ) (59 )activity (A)Other income 3.18 2.12 1.06 50 (B)Total other 17.67 17.82 (0.15 ) (1 )incomeOperating 30.68 31.59 (0.91 ) (3 )expenses (C)Pretax incomebefore 20.84 18.02 2.82 16 provision forloan lossesProvision forloan and lease 0.90 0.23 0.67 291 lossesPretax income 19.94 17.79 2.15 12 Income tax 5.52 4.61 0.91 20 expenseNet income $ 14.42 $ 13.18 $ 1.24 9 %Diluted EPS $ 0.74 $ 0.67 $ 0.07 10 % Total Revenue $ 51.52 $ 49.61 $ 1.91 4 %(D) Return onaverage assets 0.97 % 0.89 % 0.08 annualizedReturn onaverage equity 10.86 % 10.03 % 0.83 annualized

-- Capital markets activity includes loan level back-to-back swap activities, the SBA lending and sale program, corporate advisory and mortgage banking activities. The three months ended March 31, 2021 included $1.1 million of corporate advisory fee income related to a large investment banking advisory event which closed in that quarter. -- The quarter ended June 30, 2021 included a cost of $842,000 related to the termination of interest rate swaps; $1.1 million gain on the sale of PPP loans; and $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. -- The June 2021 quarter includes $648,000 of expense related to the redemption of subordinated debt. The quarter ended March 31, 2021 included $1.5 million of severance expense related to certain corporate restructuring within several areas of the Bank. -- Total revenue equals net interest income plus total other income.

The Companys near-term priorities include:

-- Grow and expand our three primary drivers of profitability: Wealth Management, Commercial Banking and Capital Markets businesses. -- Maintain loan and deposit pricing discipline to protect and grow our Net Interest Margin. -- Continue to execute on our stock repurchase program. -- Generate fee income at 35% - 45% of total bank revenue. -- Drive ROA to greater than 1% and return on average tangible common equity to greater than 14%.

Highlights of the Companys quarterly accomplishments follow:

Peapack Private Wealth Management:

-- AUM/AUA in our Peapack Private Wealth Management Division grew to $9.8 billion at June 30, 2021 (from $8.8 billion at December 31, 2020 and $7.5 billion at December 31, 2019). -- Wealth Management Fee Income increased to $13 million for Q2 2021 (compared to $10 million for Q2 2020). -- On July 1, 2021, closed on the acquisition of Princeton Portfolio Strategies Group (PPSG), a registered investment advisor headquartered in Princeton NJ with approximately $520 million of AUM/AUA.

Commercial Banking and Balance Sheet Management:

-- During Q2 2021, loans, excluding PPP loans, grew by $293 million (7% growth linked quarter: 28% annualized). -- Core deposits (which includes demand, savings and money market) totaled 88% of total deposits at June 30, 2021. The total cost of interest-bearing deposits improved to 0.34% for Q2 2021 compared to 0.40% for Q1 2021. Noninterest bearing DDA (included in core deposits) totaled 20% of total deposits. -- Net interest margin improved by 10 basis points in Q2 2021 from Q1 2021. -- $50 million of 6% subordinated debt (set to reprice to 5% on July 1, 2021) was fully redeemed on June 30, 2021. -- $40 million of interest rate swaps with an all-in cost of approximately 1.50% were terminated. -- Sold $57 million of PPP loans recognizing a gain of $1.1 million. -- Received $722,000 of fee income in Q2 2021 for the referral of PPP loans to a third party for origination. (The sale and referral of PPP loans created additional capacity for the Company to process its strong loan pipeline).

Credit and Capital Management:

-- During Q2, non-performing assets declined $6 million; classified loans declined $15 million; and loans subject to special mention declined $17 million. NPAs stood at just 0.10% of assets at June 30, 2021. -- Continued to execute on the previously approved stock repurchase program during Q2 repurchased 234,722 shares at an average price of $32.40 for a total cost of $7.6 million. (Year-to-date through June 30, 2021, the Company has repurchased 392,755 shares). -- Tangible book value per share increased to $26.30 at June 30, 2021, despite the stock repurchase activity at prices above tangible book value.



SUPPLEMENTAL QUARTERLY DETAILS

Wealth Management Business

In the June 2021 quarter, the Banks wealth management business generated $13.03 million in fee income, compared to $10.00 million for the June 2020 quarter, and $12.13 million for the March 2021 quarter.

The market value of the Companys AUM/AUA increased to $9.8 billion at June 30, 2021 from $8.8 billion at December 31, 2020, and $7.2 billion at June 30, 2020 due to new business as well as positive market action.

In the quarter ended June 30, 2021 the Company announced the acquisition of PPSG, a registered investment advisor headquartered in Princeton, New Jersey. Upon joining the Company on July 1, 2021, PPSG had approximately $520 million of AUM/AUA.

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 over $240 million for Q2 2021. Babcock went on to note, We continue to look to grow our wealth business organically and through selective acquisitions. And, we continue to make significant progress on our infrastructure consolidation including launching our new trading platform and a new CRM system, as well as adding more resources to our financial planning team.

Loans / Commercial Banking

Total loans of $4.58 billion at June 30, 2021 (including PPP loans of $84 million) increased $144 million from $4.44 billion (including PPP loans of $233 million) at March 31, 2021. Excluding the decline in PPP loans during the June quarter, loans grew $293 million, or 7% on a linked quarter basis (28% annualized). During the quarter, multifamily loans grew $241 million and C&I loans grew $47 million.

Total C&I loans (including the PPP loans) at June 30, 2021 were $1.88 billion or 41% of the total loan portfolio. While C&I origination levels have been strong throughout 2021, paydown and payoff activity has also been robust, including paydowns of several large lines of credit, as well as the Companys workout and asset recovery efforts, including the workout and recovery of several nonaccrual and/or classified credits in 2021.

Mr. Kennedy noted, Our commercial loan pipelines are strong going into the third quarter, standing at approximately $250 million with likelihood of closing during the third quarter of 2021.

Mr. Kennedy also noted, As I have mentioned in the past, our Corporate Advisory business, which gives us the capability to engage in high level strategic debt, capital and valuation analysis, enables us to provide a unique boutique level of service, giving us a competitive advantage over many of our peers. Our Corporate Advisory pipelines are also strong. Notwithstanding the sale and forgiveness of PPP loans and significant payoff activity, we believe that we will achieve high single digit loan growth, which was the upper end of our guidance provided in the beginning of 2021.

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 June 30, 2021 were $4.90 billion. While total deposits did not increase significantly over the last year, the mix changed favorably, as noninterest bearing demand deposits increased $48 million and interest-bearing demand increased $174 million, while brokered deposits declined $45 million, and higher costing CDs declined $187 million, when comparing June 30, 2021 to June 30, 2020.

Mr. Kennedy noted, 88% of our deposits are demand, savings, or money market, and, our noninterest bearing deposits comprise 20% of our total deposits; both metrics reinforce the core nature of our deposit base.

At June 30, 2021, the Companys balance sheet liquidity (investments, interest-earning deposits and cash) totaled $1.1 billion (or 18% of assets). The Company has approximately $1.7 billion of secured funding available from the Federal Home Loan Bank and $1.0 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 Companys 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 Companys yield earned 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 68% of our loan portfolio reprices within 2 years - 44% would reprice within 90 days, another 12% within 3 to 12 months and another 12% repricing within year two.

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

Six Months Ended Six Months Ended June30, 2021 June30, 2020 NII NIM NII NIM NII/NIMexcluding $ 63,001 2.51% $ 61,403 2.54% the belowPrepaymentpremiumsreceived on 1,205 0.05% 901 0.04% loanpaydownsEffect ofmaintainingexcess (300 ) -0.18% (563 ) -0.15% interestearningcashEffect of 1,732 -0.06% 1,977 -0.02% PPP loansNII/NIM as $ 65,638 2.32% $ 63,718 2.41% reported Three Months Ended Three Months Ended Three Months Ended June30, 2021 March 31, 2021 June30, 2020 NII NIM NII NIM NII NIM NII/NIMexcluding $ 32,446 2.56% $ 30,565 2.49% $ 29,881 2.45% the belowPrepaymentpremiumsreceived on 501 0.04% 704 0.05% 376 0.03% loanpaydownsEffect ofmaintainingexcess (115 ) -0.15% (195 ) -0.21% (263 ) -0.19% interestearningcashEffect of 1,013 -0.07% 719 -0.05% 1,977 -0.02% PPP loansNII/NIM as $ 33,845 2.38% $ 31,793 2.28% $ 31,971 2.27% reported

As shown above, the Companys reported NIM increased 10 basis points compared to the linked quarter. The Bank strategically lowered its cost of deposits and used much of its excess liquidity to grow loans, both of which benefitted NIM.

Future net interest income and net interest margin should benefit from the following:

-- Full realization of the second quarter loan growth, as well as robust loan pipelines. -- Continued downward repricing of maturing CDs. -- Redemption of $50 million of subordinated debt during the June quarter. -- Termination of $40 million notional interest rate swaps during the June quarter.

Income from Capital Markets Activities

Three Three Three Months Months Months Ended Ended Ended June30, March31, June30, (Dollars in thousands, except per 2021 2021 2020 share data)Gain on loans held for sale at $ 409 $ 1,025 $ 550 fair value (Mortgage banking)Fee income related to loan level, ? ? 202 back-to-back swapsGain on sale of SBA loans 932 1,449 258 Corporate advisory fee income 121 1,098 65 Total capital markets activity $ 1,462 $ 3,572 $ 1,075

Noninterest income from Capital Markets activities (SBA lending and sale program, mortgage banking activity, corporate advisory activity and loan level back-to-back swap activities) totaled $1.46 million for the June 2021 quarter compared to $3.57 million for the March 2021 quarter and $1.08 million for the June 2020 quarter. The June 2021 and March 2021 quarter results were driven by $932,000 and $1.45 million gain on sale of SBA loans, respectively. The March 2021 quarter reflected increased mortgage banking activity due to greater refinance activity in the low rate environment. During the March 2021 quarter, the Company recorded $1.1 million of corporate advisory fee income related to a large investment banking advisory event which closed in that quarter. These transactions tend to be larger and take longer to complete. As noted previously, the pipeline of such business is fairly robust. The June 2021 and March 2021 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. The June 2020 quarter included $202,000 of such income.

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

The June 2021 quarter included approximately $153,000 and the March 2021 quarter included approximately $302,000 of Bank Owned Life Insurance income due to receipt of life insurance proceeds. Such proceeds were nontaxable. The June 2021 quarter included $1.13 million gain on the sale of PPP loans, while the March 2021 quarter included a $282,000 gain on sale of $8 million of loans that had payment issues and were classified as held for sale as of December 31, 2020. The Company also received $722,000 of fee income related to referral of PPP loans to a third party. Partially offsetting the above items in the June 2021 quarter, the Company recorded a one-time $842,000 cost on the termination of $40 million notional interest rate swaps with an all-in cost of 1.50%.

Operating Expenses

The Companys total operating expenses were $30.68 million for the quarter ended June 30, 2021, compared to $31.59 million for the March 2021 quarter and $29.01 million for the June 2020 quarter. The June 2021 quarter included $648,000 of expense related to the redemption of subordinated debt. The March 2021 quarter included $1.5 million of severance expense related to certain corporate restructuring within several areas of the Bank. The June and March 2021 quarter included a full quarters worth of expense related to Lucas and Noyes (approximately $350,000 in each quarter).

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 June 30, 2021 was 27.69%, as compared to 25.94% for the March 2021 quarter and 22.85% for the quarter ended June 30, 2020. The March 31, 2021 quarter benefitted from life insurance proceeds that were not taxable and from the vesting of restricted stock at prices higher than grant prices. The effective tax rate for the June 2020 quarter was impacted by reduced taxable income due to the environment created by the Pandemic.

The effective tax rate for the six months of 2021 was 26.87% compared to a net tax benefit recorded for the first six 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 Q2 2021 Investor Update (and Supplemental Financial Information).

Nonperforming assets at June 30, 2021 (which does not include troubled debt restructured loans that are performing in accordance with their terms) were $6.0 million, or 0.10% of total assets, down from $11.8 million, or 0.20% of total assets, at March 31, 2021 and down significantly from $26.7 million, or 0.43% of total assets, at June 30, 2020.

For the quarter ended June 30, 2021, the Companys provision for loan and lease losses was $900,000 compared to $225,000 for the March 2021 quarter and $4.90 million for the June 2020 quarter. The decreased provision for loan and lease losses in the 2021 quarters when compared to the 2020 quarters reflects 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. Loan deferrals entered into during the COVID-19 pandemic have come down significantly from the prior year (declined from $914 million at June 30, 2020 to $37 million at June 30, 2021). The Companys provision for loan and lease losses (and its allowance for loan and lease losses) also reflects, among other things, the Companys assessment of asset quality metrics, net charge-offs/recoveries, and the composition of the loan portfolio.

At June 30, 2021, the allowance for loan and lease losses was $63.51 million (1.39% of total loans), compared to $67.31 million at December 31, 2020 (1.53% of total loans), and $66.07 million at June 30, 2020 (1.35% of total loans). The Company has elected to take additional time to adopt CECL and will implement effective January 1, 2022.

Capital

The Companys capital position during the June 2021 quarter was benefitted by net income of $14.42 million which was offset by the purchase of shares through the Companys stock repurchase program. During the second quarter of 2021, the Company purchased 234,722 shares at an average price of $32.40 for a total cost of $7.6 million. GAAP Capital at June 30, 2021 was also benefitted by a decrease in the unrealized loss on securities from March 31, 2021 to June 30, 2021, due to market value appreciation of the AFS investment securities portfolio.

The Companys and Banks capital ratios at June 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 Companys 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 Companys existing 6% subordinated debt and acquisitions of wealth management firms. Throughout the first half of 2021, the Company repurchased $12 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 Princeton Portfolio Strategies Group.

The Company employs quarterly capital stress testing run under multiple scenarios, including a no growth, severely adverse case. In such case as of March 31, 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 the Q2 2021 Investor Update (and Supplemental Financial Information).

On July 27, 2021, the Company declared a cash dividend of $0.05 per share payable on August 24, 2021 to shareholders of record on August 10, 2021.

ABOUT THE COMPANY

Peapack-Gladstone Financial Corporation is a New Jersey bank holding company with total assets of $5.8 billion and assets under management/administration of $9.8 billion as of June 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 banks 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 managements confidence and strategies and managements 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 value in our investment portfolio; -- impact on our business 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 nonperforming 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 theCOVID-19 outbreak 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 of 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 Companys 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 CORPORATIONSELECTED CONSOLIDATED FINANCIAL DATA(Dollars in Thousands, except share data)(Unaudited)

For the Three Months Ended June 30, March 31, Dec 31, Sept 30, June 30, 2021 2021 2020 2020 2020 Income Statement Data:Interest income $ 39,686 $ 38,239 $ 38,532 $ 40,174 $ 41,649 Interest 5,841 6,446 6,797 8,025 9,678 expenseNet interest 33,845 31,793 31,735 32,149 31,971 incomeWealthmanagement fee 13,034 12,131 10,791 10,119 9,996 incomeService charges 896 846 859 785 695 and feesBank owned life 466 611 313 314 318 insuranceGain on loansheld for saleat fair value 409 1,025 1,470 954 550 (Mortgagebanking) (A)Gain/(loss) onloans held forsale at lower 1,125 282 ? 7,429 ? of cost or fair value(B)Fee incomerelated to loanlevel, ? ? ? ? 202 back-to-back swaps (A)Gain on sale of 932 1,449 375 79 258 SBA loans (A)Corporateadvisory fee 121 1,098 50 75 65 income (A)Loss on swap (842 ) ? ? ? ? terminationOther income 1,495 643 590 456 417 (C)Securitiesgains/(losses), 42 (265 ) (42 ) ? 125 netTotal other 17,678 17,820 14,406 20,211 12,626 incomeSalaries andemployee 19,910 21,990 19,902 19,202 19,186 benefits (D)Premises and 4,074 4,113 4,189 4,109 4,036 equipmentFDIC insurance 529 585 665 605 455 expenseFHLB prepayment ? ? 4,784 ? ? penaltyValuationallowance loans ? ? 4,425 ? ? held for sale(E)Other expenses 6,171 4,906 5,284 4,545 5,337 Total operating 30,684 31,594 39,249 28,461 29,014 expensesPretax incomebefore 20,839 18,019 6,892 23,899 15,583 provision forloan lossesProvision forloan and lease 900 225 2,350 5,150 4,900 losses (F)Income/(loss)before income 19,939 17,794 4,542 18,749 10,683 taxesIncome tax 5,521 4,616 1,512 5,202 2,441 expenseNet income $ 14,418 $ 13,178 $ 3,030 $ 13,547 $ 8,242 Total revenue $ 51,523 $ 49,613 $ 46,141 $ 52,360 $ 44,597 (G)Per Common Share Data:Earnings per $ 0.76 $ 0.70 $ 0.16 $ 0.72 $ 0.44 share (basic)Earnings per 0.74 0.67 0.16 0.71 0.43 share (diluted)Weightedaverage numberof common sharesoutstanding:Basic 18,963,237 18,950,305 18,947,864 18,908,337 18,872,070 Diluted 19,439,439 19,531,689 19,334,569 19,132,650 19,059,822 Performance Ratios:Return onaverage assets 0.97 % 0.89 % 0.21 % 0.89 % 0.56 %annualized(ROAA)Return onaverage equity 10.86 % 10.03 % 2.32 % 10.53 % 6.56 %annualized(ROAE)Return onaveragetangible common 11.83 % 10.94 % 2.51 % 11.41 % 7.13 %equity (ROATCE)(H)Net interestmargin 2.38 % 2.28 % 2.25 % 2.20 % 2.27 %(tax-equivalentbasis)GAAP efficiency 59.55 % 63.68 % 85.06 % 54.36 % 65.06 %ratio (I)Operatingexpenses / 2.06 % 2.14 % 2.66 % 1.86 % 1.97 %average assetsannualized

-- 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. -- Includes gain on sale $355 million and $57 million of PPP loans completed in the September 2020 and June 2021 quarters, respectively. -- Includes income of $722,000 from the referral of PPP loans to a third-party firm during the June 2021 quarter. -- The March 2021 quarter included $1.5 million of severance expense related to corporate restructuring. -- 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. -- The March 2020, June 2020 and September 2020 quarters included a higher provision for loan and lease losses primarily due to the environment created by the COVID-19 pandemic. -- Total revenue equals net interest income plus total other income. -- 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. -- Calculated as total operating expenses as a percentage of total revenue. For Non-GAAP efficiency ratio, see Non-GAAP financial measures reconciliation included in these tables.

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

For the Six Months Ended June 30, Change 2021 2020 $ % Income Statement Data:Interest income $ 77,925 $ 87,044 $ (9,119 ) -10 %Interest expense 12,287 23,326 (11,039 ) -47 %Net interest 65,638 63,718 1,920 3 %incomeWealth management 25,165 19,951 5,214 26 %fee incomeService charges 1,742 1,511 231 15 %and feesBank owned life 1,077 646 431 67 %insuranceGain on loans heldfor sale at fair 1,434 842 592 70 %value (Mortgagebanking) (A)Gain on loans heldfor sale at lower 1,407 (3 ) 1,410 -47000 %of cost or fairvalue (B)Fee income relatedto loan level, ? 1,620 (1,620 ) -100 %back-to-back swaps(A)Gain on sale of 2,381 1,312 1,069 81 %SBA loans (A)Corporate advisory 1,219 75 1,144 1525 %fee income (A)Loss on swap (842 ) ? (842 ) N/A terminationOther income (C) 2,138 866 1,272 147 %Securities gains/ (223 ) 323 (546 ) -169 %(losses), netTotal other income 35,498 27,143 8,355 31 %Salaries andemployee benefits 41,900 38,412 3,488 9 %(D)Premises and 8,187 8,079 108 1 %equipmentFDIC insurance 1,114 705 409 58 %expenseOther expenses 11,077 10,053 1,024 10 %Total operating 62,278 57,249 5,029 9 %expensesPretax incomebefore provision 38,858 33,612 5,246 16 %for loan lossesProvision for loanand lease losses 1,125 24,900 (23,775 ) -95 %(E)Income before 37,733 8,712 29,021 333 %income taxesIncome tax expense 10,137 (903 ) 11,040 -1223 %/(benefit) (F)Net income $ 27,596 $ 9,615 $ 17,981 187 % Total revenue (G) $ 101,136 $ 90,861 $ 10,275 11 %Per Common Share Data:Earnings per share $ 1.46 $ 0.51 $ 0.95 186 %(basic)Earnings per share 1.42 0.51 0.91 178 %(diluted)Weighted averagenumber of common sharesoutstanding:Basic 18,956,807 18,865,206 91,601 0 %Diluted 19,473,150 18,991,056 482,094 3 %Performance Ratios:Return on averageassets annualized 0.93 % 0.35 % 0.58 % 166 %(ROAA)Return on averageequity annualized 10.45 % 3.80 % 6.65 % 175 %(ROAE)Return on averagetangible common 11.39 % 4.13 % 7.25 % 175 %equity (ROATCE)(H)Net interestmargin 2.32 % 2.41 % (0.09 ) -4 %(tax-equivalent %basis)GAAP efficiency 61.58 % 63.01 % (1.43 ) -2 %ratio (I) %Operating expenses/ average assets 2.10 % 2.07 % 0.03 % 2 %annualized

-- 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. -- Includes gain on sale of PPP loans of $57 million completed in the six months ended June 30, 2021. -- Includes income of $722,000 from the referral of PPP loans to a third-party firm during 2021. -- The six months ended June 30, 2021 included $1.5 million of severance expense related to corporate restructuring. -- The six months ended June 30, 2020 included a higher provision for loan and lease losses primarily due to the environment created by the COVID-19 pandemic. -- 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. -- Total revenue equals net interest income plus total other income. -- 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. -- Calculated as total operating expenses as a percentage of total revenue. For Non-GAAP efficiency ratio, see Non-GAAP financial measures reconciliation included in these tables.

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

As of June 30, March 31, Dec 31, Sept 30, June 30, 2021 2021 2020 2020 2020ASSETS Cash and due from $ 12,684 $ 8,159 $ 10,629 $ 8,400 $ 5,608banksFederal funds sold ? 102 102 102 102Interest-earning 190,778 468,276 642,591 670,863 617,117depositsTotal cash and cash 203,462 476,537 653,322 679,365 622,827equivalentsSecurities 823,820 875,301 622,689 596,929 539,742available for saleEquity security 14,894 14,852 15,117 15,159 15,159FHLB and FRB stock, 12,901 13,699 13,709 18,433 18,598at costResidential 504,181 498,884 520,188 532,120 536,015mortgageMultifamily 1,420,043 1,178,940 1,127,198 1,168,796 1,178,494mortgageCommercial mortgage 702,777 697,599 694,034 722,678 761,910Commercial loans 1,880,830 1,982,570 1,975,337 1,930,984 2,316,125(A)Consumer loans 31,889 36,519 37,016 51,859 53,111Home equity lines 44,062 45,624 50,547 52,194 54,006of creditOther loans 204 199 225 260 272Total loans 4,583,986 4,440,335 4,404,545 4,458,891 4,899,933Less: Allowancesfor loan and lease 63,505 67,536 67,309 66,145 66,065lossesNet loans 4,520,481 4,372,799 4,337,236 4,392,746 4,833,868Premises and 23,261 23,260 21,609 21,668 21,449equipmentOther real estate ? 50 50 50 50ownedAccrued interest 23,117 23,916 22,495 22,192 15,956receivableBank owned life 46,605 46,448 46,809 46,645 46,479insuranceGoodwill and other 43,156 43,524 43,891 39,622 39,943intangible assetsFinance lease 3,956 4,143 4,330 4,517 4,704right-of-use assetsOperating lease 9,569 10,186 9,421 10,011 10,810right-of-use assetsOther assets (B) 66,466 64,912 99,764 110,770 111,630TOTAL ASSETS $ 5,791,688 $ 5,969,627 $ 5,890,442 $ 5,958,107 $ 6,281,215 LIABILITIES Deposits: Noninterest-bearing $ 959,494 $ 908,922 $ 833,500 $ 838,307 $ 911,989demand depositsInterest-bearing 1,978,497 1,987,567 1,849,254 1,858,529 1,804,102demand depositsSavings 147,227 141,743 130,731 127,737 123,140Money market 1,213,992 1,256,605 1,298,885 1,251,349 1,183,603accountsCertificates of 446,143 474,668 530,222 586,801 629,941deposit ? RetailCertificates ofdeposit ? Listing 31,631 31,631 32,128 32,677 35,327ServiceSubtotal ?customer? 4,776,984 4,801,136 4,674,720 4,695,400 4,688,102depositsIB Demand ? 85,000 110,000 110,000 130,000 130,000BrokeredCertificates of 33,791 33,777 33,764 33,750 33,736deposit ? BrokeredTotal deposits 4,895,775 4,944,913 4,818,484 4,859,150 4,851,838Short-term ? 15,000 15,000 15,000 15,000borrowingsFHLB advances (C) ? ? ? 105,000 105,000Paycheck ProtectionProgram Liquidity 83,586 168,180 177,086 183,790 535,837.00Facility (D)Finance lease 6,299 6,528 6,753 6,976 7,196liabilityOperating lease 9,902 10,509 9,737 10,318 11,116liabilitySubordinated debt, 132,557 181,837 181,794 83,585 83,529net (E)Other liabilities 125,110 120,219 154,466 156,472 163,719(B)Due to brokers ? ? ? 15,088 ?TOTAL LIABILITIES 5,253,229 5,447,186 5,363,320 5,435,379 5,773,235Shareholders? 538,459 522,441 527,122 522,728 507,980equityTOTAL LIABILITIES ANDSHAREHOLDERS? $ 5,791,688 $ 5,969,627 $ 5,890,442 $ 5,958,107 $ 6,281,215EQUITYAssets undermanagement and / oradministration at

Peapack-GladstoneBank?s Private $ 9.8 $ 9.4 $ 8.8 $ 7.6 $ 7.2Wealth Management Division (marketvalue, not includedabove-dollars inbillions)

-- Includes PPP loans of $84 million at June 30, 2021, $233 million at March 31, 2021, $196 million at December 31, 2020, $202 million at September 30, 2020 and $547 million at June 30, 2020. -- 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. -- The Company prepaid $105 million of FHLB advances with a weighted-average rate of 3.20% during the December 2020 quarter. -- Represents funding provided by the Federal Reserve for pledged PPP loans. -- The increase was due to the completion of a $100 million subordinated debt offering in December 22, 2020. The Company redeemed $50 million of subordinated debt on June 30, 2021.

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

As of June 30, March 31, Dec 31, Sept 30, June 30, 2021 2021 2020 2020 2020 Asset Quality:Loans pastdue over 90days and $ ? $ ? $ ? $ ? $ ? stillaccruingNonaccrual 5,962 11,767 11,410 8,611 26,697 loans (A)Other real ? 50 50 50 50 estate ownedTotalnonperforming $ 5,962 $ 11,817 $ 11,460 $ 8,661 $ 26,747 assets Nonperformingloans to 0.13 % 0.27 % 0.26 % 0.19 % 0.54 %total loansNonperformingassets to 0.10 % 0.20 % 0.19 % 0.15 % 0.43 %total assets Performing $ 190 $ 197 $ 201 $ 2,278 $ 2,376 TDRs (B)(C) Loans pastdue 30through 89days and $ 1,678 $ 1,622 $ 5,053 $ 6,609 $ 3,785 stillaccruing (D)(E) Loans subjectto special $ 148,601 $ 166,013 $ 162,103 $ 129,700 $ 27,922 mention Classified $ 11,178 $ 25,714 $ 37,771 $ 41,263 $ 63,562 loans Impaired $ 6,498 $ 11,964 $ 16,204 $ 15,514 $ 33,708 loans Allowance forloan and lease losses:Beginning of $ 67,536 $ 67,309 $ 66,145 $ 66,065 $ 63,783 periodProvision forloan and 900 225 2,350 5,150 4,900 lease losses(Charge-offs)/recoveries, (4,931 ) 2 (1,186 ) (5,070 ) (2,618 )netEnd of period $ 63,505 $ 67,536 $ 67,309 $ 66,145 $ 66,065 ALLL tononperforming 1065.16 % 573.94 % 589.91 % 768.15 % 247.46 %loansALLL to total 1.39 % 1.52 % 1.53 % 1.48 % 1.35 %loansGeneral ALLLto total 1.38 % 1.45 % 1.47 % 1.48 % 1.26 %loans (F)

-- Excludes one commercial loan held for sale of $5.6 million at both 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. -- Amounts reflect TDRs that are paying according to restructured terms. -- Amount excludes $3.9 million at June 30, 2021, $3.9 million at March 31, 2021, $4.0 million at December 31, 2020, $5.2 million at September 30, 2020 and $23.2 million at June 30, 2020 of TDRs included in nonaccrual loans. -- Excludes a residential loan held for sale of $93,000 at December 31, 2020. -- 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. -- Total ALLL less specific reserves equals general ALLL.

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

June30, December 31, June30, 2021 2020 2020 Capital Adequacy Equity to total 9.30 % 8.95 % 8.09 %assets (A)(J)Tangible Equityto tangible 8.62 % 8.27 % 7.50 %assets (B)Tangible Equityto tangibleassets excluding 8.74 % 8.55 % 8.22 % PPP loans(C)Book value per $ 28.60 $ 27.78 $ 26.87 share (D)Tangible BookValue per share $ 26.30 $ 25.47 $ 24.76 (E)

June30, December 31, June30, 2021 2020 2020RegulatoryCapital ? HoldingCompanyTier I $ 499,344 8.67% $ 483,535 8.53% $ 468,898 8.57%leverageTier Icapital to 499,344 11.45 483,535 11.93 468,898 11.35risk-weightedassetsCommon equitytier Icapital ratio 499,315 11.45 483,500 11.93 468,863 11.35 torisk-weightedassetsTier I & IIcapital to 686,543 15.74 716,210 17.67 604,258 14.62risk-weightedassets RegulatoryCapital ? BankTier I $ 583,208 10.13% $ 549,575 9.71% $ 534,794 9.79%leverage (F)Tier Icapital to 583,208 13.37 549,575 13.55 534,794 12.96risk-weightedassets (G)Common equitytier Icapital ratio 583,179 13.37 549,540 13.55 534,759 12.95 torisk-weightedassets (H)Tier I & IIcapital to 637,858 14.62 600,478 14.81 586,574 14.21risk-weightedassets (I)

-- Equity to total assets is calculated as total shareholders equity as a percentage of total assets at period end. -- 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. -- 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. -- Book value per common share is calculated by dividing shareholders equity by period end common shares outstanding -- 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. -- Regulatory well capitalized standard = 5.00% ($288 million) -- Regulatory well capitalized standard = 8.00% ($349 million) -- Regulatory well capitalized standard = 6.50% ($284 million) -- Regulatory well capitalized standard = 10.00% ($436 million) -- PPP loans with a balance of $84 million at June 30, 2021, $196 million at December 31, 2020 and $547 million at June 30, 2020 increased total assets.

PEAPACK-GLADSTONE FINANCIAL CORPORATIONLOANS CLOSED(Dollars in Thousands)(Unaudited)

For the Quarters Ended June 30, March 31, Dec 31, Sept 30, June 30, 2021 2021 2020 2020 2020 Residential loans $ 37,083 $ 15,814 $ 22,316 $ 32,599 $ 18,627 retainedResidential loans 25,432 45,873 64,630 54,521 37,061 soldTotal residential 62,515 61,687 86,946 87,120 55,688 loansCommercial real 12,243 38,363 ? 1,613 748 estateMultifamily 255,820 85,009 1,184 1,500 11,960 Commercial (C&I) 141,285 129,141 218,235 118,048 99,294 loans (A) (B)SBA (C) 15,976 58,730 8,355 4,962 595,651 Wealth lines of 3,200 2,475 3,925 2,000 500 credit (A)Total commercial 428,524 313,718 231,699 128,123 708,153 loansInstallment loans 25 63 690 253 950 Home equity lines 4,140 1,899 2,330 4,759 4,280 of credit (A)Total loans closed $ 495,204 $ 377,367 $ 321,665 $ 220,255 $ 769,071

For the Six Months Ended June 30, June 30, 2021 2020Residential loans retained $ 52,897 $ 33,458Residential loans sold 71,305 56,452Total residential loans 124,202 89,910Commercial real estate 50,606 9,606Multifamily 340,829 73,958Commercial (C&I) loans (A) (B) 270,426 142,202SBA (C) 74,706 609,481Wealth lines of credit (A) 5,675 3,750Total commercial loans 742,242 838,997Installment loans 88 1,206Home equity lines of credit (A) 6,039 7,912Total loans closed $ 872,571 $ 938,025

-- Includes loans and lines of credit that closed in the period but not necessarily funded. -- Includes equipment finance. -- 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 quarter ended June 30, 2020.

PEAPACK-GLADSTONE FINANCIAL CORPORATIONAVERAGE BALANCE SHEETUNAUDITEDTHREE MONTHS ENDED(Tax-Equivalent Basis, Dollars in Thousands)

June30, 2021 June30, 2020 Average Income/ Average Income/ Balance Expense Yield Balance Expense Yield ASSETS: Interest-earning assets:Investments: Taxable (A) $ 884,374 $ 3,020 1.37 % $ 437,288 $ 2,108 1.93 %Tax-exempt (A) (B) 6,891 81 4.70 10,137 129 5.09 Loans (B) (C): Mortgages 498,594 3,826 3.07 530,087 4,497 3.39 Commercial 1,941,330 15,056 3.10 2,083,310 16,147 3.10 mortgagesCommercial 1,942,802 16,984 3.50 2,038,530 18,204 3.57 Commercial 20,952 180 3.44 3,296 44 5.34 constructionInstallment 34,319 255 2.97 52,859 371 2.81 Home equity 45,042 377 3.35 54,869 453 3.30 Other 219 5 9.13 318 7 8.81 Total loans 4,483,258 36,683 3.27 4,763,269 39,723 3.34 Federal funds sold 91 ? 0.06 102 ? 0.25 Interest-earning 428,464 97 0.09 497,764 109 0.09 depositsTotalinterest-earning 5,803,078 39,881 2.75 % 5,708,560 42,069 2.95 %assetsNoninterest-earning assets:Cash and due from 10,360 5,437 banksAllowance for loan (67,593 ) (64,109 ) and lease lossesPremises and 23,307 21,462 equipmentOther assets 182,421 234,357 Totalnoninterest-earning 148,495 197,147 assetsTotal assets $ 5,951,573 $ 5,905,707 LIABILITIES: Interest-bearing deposits:Checking $ 1,980,688 $ 944 0.19 % $ 1,748,753 $ 1,642 0.38 %Money markets 1,235,464 727 0.24 1,207,816 1,473 0.49 Savings 144,044 18 0.05 118,878 16 0.05 Certificates of 488,148 1,027 0.84 676,498 3,147 1.86 deposit ? retailSubtotalinterest-bearing 3,848,344 2,716 0.28 3,751,945 6,278 0.67 depositsInterest-bearing 105,604 456 1.73 150,330 700 1.86 demand ? brokeredCertificates of 33,783 264 3.13 33,729 264 3.13 deposit ? brokeredTotalinterest-bearing 3,987,731 3,436 0.34 3,936,004 7,242 0.74 depositsBorrowings 166,343 182 0.44 330,514 1,127 1.36 Capital lease 6,380 76 4.76 7,270 87 4.79 obligationSubordinated debt 181,317 2,147 4.74 83,496 1,222 5.85 Totalinterest-bearing 4,341,771 5,841 0.54 % 4,357,284 9,678 0.89 %liabilitiesNoninterest-bearing liabilities:Demand deposits 948,851 873,926 Accrued expensesand other 129,980 171,814 liabilitiesTotalnoninterest-bearing 1,078,831 1,045,740 liabilitiesShareholders? 530,971 502,683 equityTotal liabilitiesand shareholders? $ 5,951,573 $ 5,905,707 equityNet interest income $ 34,040 $ 32,391 Net interest spread 2.21 % 2.06 %Net interest margin 2.38 % 2.27 %(D)

-- Average balances for available for sale securities are based on amortized cost. -- Interest income is presented on a tax-equivalent basis using a 21% federal tax rate. -- Loans are stated net of unearned income and include nonaccrual loans. -- Net interest income on a tax-equivalent basis as a percentage of total average interest-earning assets.

PEAPACK-GLADSTONE FINANCIAL CORPORATIONAVERAGE BALANCE SHEETUNAUDITEDTHREE MONTHS ENDED(Tax-Equivalent Basis, Dollars in Thousands)

June30, 2021 March 31, 2021 Average Income/ Average Income/ Balance Expense Yield Balance Expense Yield ASSETS: Interest-earning assets:Investments: Taxable (A) $ 884,374 $ 3,020 1.37 % $ 761,187 $ 2,629 1.38 %Tax-exempt (A) (B) 6,891 81 4.70 7,980 98 4.91 Loans (B) (C): Mortgages 498,594 3,826 3.07 501,590 3,954 3.15 Commercial 1,941,330 15,056 3.10 1,840,363 14,420 3.13 mortgagesCommercial 1,942,802 16,984 3.50 1,932,692 16,455 3.41 Commercial 20,952 180 3.44 15,606 139 3.56 constructionInstallment 34,319 255 2.97 37,695 276 2.93 Home equity 45,042 377 3.35 48,853 399 3.27 Other 219 5 9.13 246 5 8.13 Total loans 4,483,258 36,683 3.27 4,377,045 35,648 3.26 Federal funds sold 91 ? 0.06 102 ? 0.25 Interest-earning 428,464 97 0.09 555,331 128 0.09 depositsTotalinterest-earning 5,803,078 39,881 2.75 % 5,701,645 38,503 2.70 %assetsNoninterest-earning assets:Cash and due from 10,360 11,129 banksAllowance for loan (67,593 ) (71,160 ) and lease lossesPremises and 23,307 22,634 equipmentOther assets 182,421 228,134 Totalnoninterest-earning 148,495 190,737 assetsTotal assets $ 5,951,573 $ 5,892,382 LIABILITIES: Interest-bearing deposits:Checking $ 1,980,688 $ 944 0.19 % $ 1,908,380 $ 978 0.20 %Money markets 1,235,464 727 0.24 1,259,597 794 0.25 Savings 144,044 18 0.05 135,202 17 0.05 Certificates of 488,148 1,027 0.84 533,488 1,470 1.10 deposit ? retailSubtotalinterest-bearing 3,848,344 2,716 0.28 3,836,667 3,259 0.34 depositsInterest-bearing 105,604 456 1.73 110,000 493 1.79 demand ? brokeredCertificates of 33,783 264 3.13 33,769 261 3.09 deposit ? brokeredTotalinterest-bearing 3,987,731 3,436 0.34 3,980,436 4,013 0.40 depositsBorrowings 166,343 182 0.44 186,006 209 0.45 Capital lease 6,380 76 4.76 6,608 79 4.78 obligationSubordinated debt 181,317 2,147 4.74 181,795 2,145 4.72 Totalinterest-bearing 4,341,771 5,841 0.54 % 4,354,845 6,446 0.59 %liabilitiesNoninterest-bearing liabilities:Demand deposits 948,851 848,325 Accrued expensesand other 129,980 163,569 liabilitiesTotalnoninterest-bearing 1,078,831 1,011,894 liabilitiesShareholders? 530,971 525,643 equityTotal liabilitiesand shareholders? $ 5,951,573 $ 5,892,382 equityNet interest income $ 34,040 $ 32,057 Net interest spread 2.21 % 2.11 %Net interest margin 2.38 % 2.28 %(D)

-- Average balances for available for sale securities are based on amortized cost. -- Interest income is presented on a tax-equivalent basis using a 21% federal tax rate. -- Loans are stated net of unearned income and include nonaccrual loans. -- Net interest income on a tax-equivalent basis as a percentage of total average interest-earning assets.

PEAPACK-GLADSTONE FINANCIAL CORPORATIONAVERAGE BALANCE SHEETUNAUDITEDSIX MONTHS ENDED(Tax-Equivalent Basis, Dollars in Thousands)

June30, 2021 June 30, 2020 Average Income/ Average Income/ Balance Expense Yield Balance Expense Yield ASSETS: Interest-earning assets:Investments: Taxable (A) $ 823,120 $ 5,649 1.37 % $ 424,547 $ 4,567 2.15 %Tax-exempt (A) (B) 7,433 179 4.82 10,335 260 5.03 Loans (B) (C): Mortgages 500,084 7,780 3.11 532,601 9,073 3.41 Commercial 1,891,125 29,476 3.12 2,019,559 34,629 3.43 mortgagesCommercial 1,937,776 33,439 3.45 1,898,334 36,798 3.88 Commercial 18,294 319 3.49 4,462 132 6 constructionInstallment 35,997 531 2.95 53,421 835 3.13 Home equity 46,937 776 3.31 55,261 1,067 3.86 Other 233 10 8.58 341 16 9.38 Total loans 4,430,446 72,331 3.27 4,563,979 82,550 3.62 Federal funds sold 96 ? 0.11 102 ? 0.25 Interest-earning 491,547 225 0.09 374,665 661 0.35 depositsTotalinterest-earning 5,752,642 78,384 2.73 % 5,373,628 88,038 3.28 %assetsNoninterest-earning assets:Cash and due from 10,743 5,477 banksAllowance for loan (69,367 ) (54,238 ) and lease lossesPremises and 22,972 21,304 equipmentOther assets 204,390 197,904 Totalnoninterest-earning 168,738 170,447 assetsTotal assets $ 5,921,380 $ 5,544,075 LIABILITIES: Interest-bearing deposits:Checking $ 1,944,734 $ 1,922 0.20 % $ 1,644,776 $ 5,089 0.62 %Money markets 1,247,464 1,521 0.24 1,199,932 4,454 0.74 Savings 139,648 35 0.05 114,892 31 0.05 Certificates of 510,693 2,497 0.98 687,258 6,841 1.99 deposit ? retailSubtotalinterest-bearing 3,842,539 5,975 0.31 3,646,858 16,415 0.90 depositsInterest-bearing 107,790 949 1.76 165,165 1,623 1.97 demand ? brokeredCertificates of 33,776 525 3.11 33,722 527 3.13 deposit ? brokeredTotalinterest-bearing 3,984,105 7,449 0.37 3,845,745 18,565 0.97 depositsBorrowings 176,120 391 0.44 256,956 2,139 1.66 Capital lease 6,493 155 4.77 7,373 177 4.80 obligationSubordinated debt 181,555 4,292 4.73 83,467 2,445 5.86 Totalinterest-bearing 4,348,273 12,287 0.57 % 4,193,541 23,326 1.11 %liabilitiesNoninterest-bearing liabilities:Demand deposits 898,866 708,242 Accrued expensesand other 145,920 136,738 liabilitiesTotalnoninterest-bearing 1,044,786 844,980 liabilitiesShareholders? 528,322 505,554 equityTotal liabilitiesand shareholders? $ 5,921,381 $ 5,544,075 equityNet interest income $ 66,097 $ 64,712 Net interest spread 2.16 % 2.17 %Net interest margin 2.32 % 2.41 %(D)

-- Average balances for available for sale securities are based on amortized cost. -- Interest income is presented on a tax-equivalent basis using a 21% federal tax rate. -- Loans are stated net of unearned income and include nonaccrual loans. -- Net interest income on a tax-equivalent basis as a percentage of total average interest-earning assets.

PEAPACK-GLADSTONE FINANCIAL CORPORATIONNON-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 June 30, March 31, Dec 31, Sept 30, June 30, Tangible BookValue Per 2021 2021 2020 2020 2020 ShareShareholders? $ 538,459 $ 522,441 $ 527,122 $ 522,728 $ 507,980 equityLess:Intangible 43,156 43,524 43,891 39,622 39,943 assets, netTangible 495,303 478,917 483,231 483,106 468,037 equity Period endshares 18,829,877 19,034,870 18,974,703 18,924,953 18,905,135 outstandingTangible bookvalue per $ 26.30 $ 25.16 $ 25.47 $ 25.53 $ 24.76 shareBook value 28.60 27.45 27.78 27.62 26.87 per share TangibleEquity to TangibleAssetsTotal assets $ 5,791,688 $ 5,969,627 $ 5,890,442 $ 5,958,107 $ 6,281,215 Less:Intangible 43,156 43,524 43,891 39,622 39,943 assets, netTangible 5,748,532 5,926,103 5,846,551 5,918,485 6,241,272 assetsLess: PPP 83,766 232,721 195,574 201,991 547,004 LoansTangibleAssets 5,664,766 5,693,382 5,650,977 5,716,494 5,694,268 excluding PPPLoansTangibleequity to 8.62 % 8.08 % 8.27 % 8.16 % 7.50 %tangibleassetsTangibleequity totangible 8.74 % 8.41 % 8.55 % 8.45 % 8.22 %assetsexcluding PPPloansEquity to 9.30 % 8.75 % 8.95 % 8.77 % 8.09 %assets (A)

-- 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. Equity to total assets would be 8.86% if PPP loans of $547 million were excluded from total assets as of June 30, 2020.

Three Months Ended June 30, March 31, Dec 31, Sept 30, June 30, Return onAverage 2021 2021 2020 2020 2020 TangibleEquityNet income $ 14,418 $ 13,178 $ 3,030 $ 13,547 $ 8,242 Averageshareholders? $ 530,971 $ 525,643 $ 523,446 $ 514,736 $ 502,683 equityLess:Average 43,366 43,742 40,336 39,811 40,139 intangibleassets, netAveragetangible 487,605 481,901 483,110 474,925 462,544 equity Return onaverage 11.83 % 10.94 % 2.51 % 11.41 % 7.13 %tangiblecommon equity

For the Six Months Ended June 30, June 30, Return on Average Tangible Equity 2021 2020 Net income $ 27,596 $ 9,615 Average shareholders? equity $ 528,322 $ 505,554 Less: Average intangible assets, net 43,553 40,299 Average tangible equity 484,769 465,255 Return on average tangible common equity 11.39 % 4.13 %

Three Months Ended June 30, March Dec 31, Sept 30, June 30, 31,Efficiency 2021 2021 2020 2020 2020 RatioNet interest $ 33,845 $ 31,793 $ 31,735 $ 32,149 $ 31,971 incomeTotal other 17,678 17,820 14,406 20,211 12,626 incomeLess: Loss/(gain) on loans held forsaleat lower ofcost or fair (1,125 ) (282 ) ? (7,429 ) ? valueLess: Incomefrom life (153 ) (302 ) ? ? ? insuranceproceedsLess: Loss/(gain) on swap 842 ? ? ? ? terminationAdd:Securities (42 ) 265 42 ? (125 )(gains)/losses, netTotalrecurring 51,045 49,294 46,183 44,931 44,472 revenue Operating 30,684 31,594 39,249 28,461 29,014 expensesLess: FHLBprepayment ? ? 4,784 ? ? penalty Valuationallowance ? ? 4,425 ? ? loans held forsale Write-offof 648 ? ? ? ? subordinateddebt costs Severance ? 1,532 ? ? ? expenseTotaloperating 30,036 30,062 30,040 28,461 29,014 expense Efficiency 58.84 % 60.99 % 65.05 % 63.34 % 65.24 %ratio

For the Six Months Ended June 30, June 30, Efficiency Ratio 2021 2020 Net interest income $ 65,638 $ 63,718 Total other income 35,498 27,143 Add: Securities (gains)/losses, net 223 (323 )Less: Loss/(gain) on swap termination 842 ? Less: Income from life insurance proceeds (455 ) ? Less: Loss/(gain) on loans held for sale at lower of cost or fair value (1,407 ) 3 Total recurring revenue 100,339 90,541 Operating expenses 62,278 57,249 Less: Write-off of subordinated debt costs 648 ? Severance expense 1,532 ? Total operating expense 60,098 57,249 Efficiency ratio 59.89 % 63.23 %

Contact:

Jeffrey J. Carfora, SEVP and CFO

Peapack-Gladstone Financial Corporation

T: 908-719-4308