Primis Financial Corp. Faces Nasdaq Compliance Challenges Following Delayed Filings

Overview

Primis Financial Corp., a publicly traded company on the Nasdaq under the symbol FRST, has recently encountered regulatory hurdles that have triggered investor concern. On November 27, 2024, the firm announced that it received an additional notice from Nasdaq stating it remains noncompliant with Listing Rule 5250(c)(1). This compliance rule requires timely submission of periodic filings, specifically the Quarterly Report on Form 10-Q, for both the second and third quarters of 2024.

Details of the Notice

The company has not yet submitted its Form 10-Qs for the quarters ended June 30 and September 30, 2024. Despite efforts to resolve these issues, the delays have raised alarms concerning the potential for delisting from the Nasdaq exchange. The additional notice also stipulates that the Company must update the Nasdaq Hearings Panel regarding its compliance status no later than November 28, 2024.

Previously, Primis Financial was granted a 180-day extension to achieve compliance, which lapsed on October 3, 2024. Following this lapse, the company was informed of a potential delisting, prompting it to appeal the decision and request a hearing. Furthermore, the Nasdaq issued a temporary stay of the delisting process, allowing time for a review scheduled for December 3, 2024.

Recent Developments

In recent weeks, Primis has made some progress by filing its delayed Form 10-K for 2023 and its Form 10-Q for the first quarter of 2024. The Company intends to file the outstanding Form 10-Qs as quickly as possible, indicating a commitment to resolving its compliance challenges. As a result of these developments, there is currently no immediate risk to the company's listing on the Nasdaq Global Select Market, and it remains optimistic about regaining compliance in the near future.

Company Profile

As of September 30, 2024, Primis Financial reported impressive figures, including total assets of $4.0 billion, total loans held for investment at $3.0 billion, and total deposits amounting to $3.3 billion. Infrastructure-wise, Primis Bank serves a diverse range of financial needs through 24 full-service branches located across Virginia and Maryland, alongside offering online and mobile banking solutions.

Challenges Ahead

Looking forward, the company acknowledges several risks associated with its forward-looking statements and the potential impact of ongoing regulatory scrutiny. The internal challenges may potentially lead to additional reporting delays, which could affect investor confidence and company valuation. Moreover, any signs of mismanagement or errors in their financial reporting could provoke regulatory penalties or legal actions.

The management stresses the importance of improving internal controls and adhering strictly to compliance measures to prevent future occurrences of this nature.

Conclusion

Primis Financial Corp. currently navigates a difficult landscape marked by compliance challenges linked to Nasdaq regulations. As they proactively address these financial reporting delays, investors remain watchful for updates that may influence future stability and growth prospects of the company. The outcome of the upcoming hearing will play a pivotal role in determining the company's path forward on Nasdaq.

In conclusion, the fate of Primis Financial's continued listing hinges significantly on their ability to meet regulatory expectations, reinforce financial practices, and communicate effectively with their stakeholders.