🔒CT bank outlines major turnaround efforts in shareholder letter

Stamford-based Patriot Bank, which has been working to stabilize its operations after years of financial strain, says it raised nearly $100 million in equity in 2025, replaced most of its senior leadership team and returned to profitability late in the year, according to an annual letter to shareholders released this week. In the Jan. 1 letter, CEO Steven Sugarman said the bank completed a major recapitalization in March 2025 and began what he described as a “wholesale restructuring” of its business, a process expected to continue through the first half of 2026. Patriot’s overhaul follows a turbulent period for the Stamford-based bank. In March 2025, the company announced that then-CEO David Lowery would step down as it explored a potential merger and other capital-raising options. At the time, Patriot also disclosed plans to raise more than $50 million in a private placement to strengthen its balance sheet and said it had entered into an agreement with the Office of the Comptroller of the Currency to submit a strategic plan aimed at improving its financial condition. Patriot Bank, a subsidiary of publicly traded Patriot National Bancorp Inc., reported a Tier 1 capital ratio of more than 18% as of Sept. 30, according to the letter. Sugarman said the bank believes it is now “one of the most strongly capitalized banks of its size” in its markets. The bank replaced much of its senior leadership in 2025, adding a new president, chief financial officer, chief credit officer and chief risk officer, among other executives. Patriot also added seven new directors to its board, Sugarman said. As part of the restructuring, Patriot exited what it described as legacy loan programs and launched three new lending lines focused on commercial real estate, high-net-worth credit lines and asset-backed rediscount loans. The bank also sold higher-risk loan portfolios, increased its allowance for loan losses and worked to resolve inherited problem assets, according to the letter. Sugarman said Patriot closed more than $100 million in loans in 2025 after relaunching its lending platform and executed more than $200 million in term sheets. He said the new loans and deposits generated “attractive” net interest margins, though the bank did not disclose full-year financial results in the letter. Patriot also restructured its deposit business to focus on high-net-worth individuals and family offices, launching a concierge-style banking platform and a relationship-based “Founders Club” program that offers preferred pricing and services to large clients. In addition to its traditional retail and commercial banking operations, Patriot has expanded its institutional banking business, which provides banking and payments services to fintech firms and non-depository financial institutions. Sugarman said that unit has become the bank’s largest source of non-interest income and that annualized digital payments revenue has increased more than 25% since the recapitalization. Sugarman said Patriot returned to profitability late in 2025 and is targeting consolidated profitability in 2026, including costs associated with its publicly traded holding company. Looking ahead, Patriot plans to open a client-facing office in Beverly Hills, California, in the first quarter of 2026, in addition to its existing presence in Fairfield County and New York. Management is also evaluating potential offices in Florida and Texas to serve what the bank described as a mobile, high-net-worth client base. Sugarman said the bank does not expect to raise additional common equity in the near term to support organic growth and believes its current capital base could support roughly $2 billion in assets over the next two years, assuming improved earnings. The CEO also said Patriot may pursue acquisitions in the future, citing management’s prior experience with bank mergers, though no specific transactions were announced.