Press Release

CBB Bancorp, Inc. Reports Fourth Quarter and Full Year 2019 Financial Results

Company Release - 1/29/2020 9:00 AM ET

LOS ANGELES--(BUSINESS WIRE)-- CBB Bancorp, Inc. ("CBB" or the "Company') (OTCQX: CBBI), the holding company of Commonwealth Business Bank (the "Bank"), today announced net income for the fourth quarter of 2019 of $2.9 million, or $0.28 per diluted share, a decrease of 16.5% compared to $3.4 million, or $0.33 per diluted share, in the prior quarter and a decrease of 19.9% compared to $3.7 million, or $0.35 per share of net income in the same period last year.

Additionally, CBB reported net income for the year ended December 31, 2019 of $13.3 million or $1.29 per diluted share, a decrease of 19.9% from the $16.7 million, or $1.60 per diluted share, of net income for 2018.

Fourth quarter 2019 net income resulted in a return on average assets (“ROA”) and a return on average equity (“ROE”) of 0.97% and 7.66% respectively, with both measures down from the fourth quarter of 2018. For the full-year 2019, ROA and ROE were 1.15% and 9.45%, down from 1.50% and 13.49% for the prior year. The fourth quarter and full year financial performance results were adversely impacted by a lower interest rate environment, including three interest rate cuts from the Federal Open Market Committee (“FOMC”).

Joanne Kim, President and CEO, commented, “Net interest margin compression and higher personnel costs related to compliance affected our net income for 2019. We have worked diligently to lower our funding costs since the early part of 2019, and we are beginning to see our interest-bearing costs decline.” She also commented further, “We have made substantial investments in our CBB Bank branding campaign which will continue into 2020, and have substantially strengthened our compliance division. We believe these investments will add value to our organization.”

Net Interest Income and Margin:

Net Interest Income

Net interest income for the quarter ended December 31, 2019 was $10.7 million, a decrease of $1.5 million, or 12.1% over the same period last year. For the twelve months ended December 31, 2019, net interest income decreased to $44.4 million, a decrease of $1.8 million, or 3.9% over the corresponding period last year. The decrease in net interest income was primarily driven by the decline in market interest rates. Our adjustable rate portfolio, which comprises approximately 48% of the loan portfolio, repriced downward due to the rate cuts by the FOMC. Additionally, lower market rates have triggered a higher level of loan refinancing.

Net Interest Margin

The net interest margin for the quarter ended December 31, 2019 of 3.77% compares with 4.32% in the same period last year, primarily due to loan yields falling faster than funding costs in reaction to lower market interest rates. For the year ended December 31, 2019, the margin was 3.94% compared to 4.30% for the corresponding period in 2018.

Our average loan yields decreased to 6.02% for the quarter ended December 31, 2019 compared with 6.41% or 39 basis points lower from the quarter ended December 31, 2018. Our cost of funds decreased to 1.79% for the quarter ended December 31, 2019 compared to 1.93%, or 14 basis points lower than the prior quarter but increased to 1.57%, or 22 basis points higher than the quarter ended December 31, 2018. The rate decrease from the prior quarter was primarily in certificates of deposit. We anticipate the cost of funds will come down as certificate of deposits mature and reprice.

Ms. Kim noted, “On the funding side, we continue to see heightened competition in deposit pricing despite the three rate cuts. To address this, we are taking steps to broaden and diversify our funding sources including placing more emphasis on savings and money market accounts and less emphasis on certificate of deposits.”

Provision for Loan Losses:

The provision for loan losses for the quarter and year ended December 31, 2019 was $700 thousand and $1.30 million, respectively, compared with $170 thousand and $1.37 million, respectively, for the corresponding periods last year. Nonperforming assets increased to $8.4 million compared to $410 thousand as of December 31, 2018. The coverage ratio of the allowance for loan losses to nonperforming assets continues to exceed 100%. See Table 10 for additional details and trends.

Noninterest Income:

Noninterest income for fourth quarter 2019 was $2.3 million compared to $1.3 million for fourth quarter 2018. The increase was due to higher gains on sale of SBA loans in 2019 and an impairment write down of loan servicing rights in 2018. For the year ended December 31, 2019, noninterest income was $9.8 million compared to $10.3 million in 2018, a decrease of $493 thousand or 4.8%. For the full year, noninterest income was lower than the prior year due lower gains on sale of SBA loans in 2019 and an impairment write down of servicing rights for 2018.

Noninterest Expense:

Noninterest expense for the quarter ended December 31, 2019 was $8.4 million compared to $8.4 million in the corresponding period last year. For the year ended December 31, 2019, noninterest expense was $34.1 million compared to $32.0 million for the corresponding period last year, an increase of $2.1 million or 6.5%. The primary contributors to the increased noninterest expenses were a $1.45 million increase in salaries and employee benefits and a $683 thousand increase in professional expense. Staffing additions primarily related to compliance and corporate administration, along with professional consulting expenses related to compliance, caused the increases.

Staffing and Salaries:

Salary expense was $5.4, million for the quarter ended December 31, 2019, compared to $5.0 million for the corresponding period last year. Salary expense for the years ended December 31, 2019 and 2018 was $21.1 million and $19.6 million, respectively. The year over year increase primarily relates to an increase in full-time equivalents (“FTE”) from 187 at December 31, 2018 to 191 FTE at December 31, 2019. The increase in FTE primarily relates to the additional compliance and corporate administration staff.

Occupancy and Equipment:

Occupancy and equipment expense for the quarter ended December 31, 2019 was $978 thousand, compared to $886 thousand in the corresponding period last year. For the year ended December 31, 2019, occupancy and equipment expense was $3.51 million compared to $3.45 million for the corresponding period last year, an increase of $65 thousand or 1.9%.

Professional Fees:

Professional fees for the quarter ended December 31, 2019 were $417 thousand, compared to $1.20 million for the corresponding period last year, a decrease of $778 thousand, or 65.1%. For the twelve months ended December 31, 2019, professional fees were $2.32 million compared to $2.59 million for the corresponding period last year, a decrease of $237 thousand or 10.5%. The additional costs in 2018 were for the implementation of Internal Control over Financial Reporting (ICFR) required by the Federal Deposit Insurance Corporation Improvement Act FDICIA, as well as professional consulting expenses resulted to compliance.

Income Taxes:

The Company’s effective tax rate for the quarter ended December 31, 2019 was approximately 28.5%, compared with 25.9% in the quarter ended December 31, 2018. The effective tax rate for the year ended December 31, 2019 was approximately 29.0%, compared with 27.9% for the year ended December 31, 2018.

Balance Sheet:

Investment Securities:

Investment securities were $94.7 million at December 31, 2019, down $9.8 million since December 31, 2018 due to principal paydowns. There were no portfolio additions.

Loans Receivable:

Loans receivable outstanding (including loans held for sale) increased from $921.5 million as of December 31, 2018 to $935.7 million as of December 31, 2019, an increase of $14.2 million or 1.5%. Average loans outstanding (including loans held for sale) increased from $922.0 million for the year ended December 31, 2018 to $930.5 million for the year ended December 31, 2019, an increase of $8.5 million or 1.0%. Ms. Kim further commented that “Organic portfolio loan growth is slowing down. We are seeing continued payoffs, both commercial and SBA loans as our borrowers take advantage of lower fixed rates offered by competitor banks due to lower market interest rates. Property owners are taking advantage of lower rates as they are refinancing for better rates.”

Allowance for Loan Losses and Asset Quality:

The allowance for loan losses at December 31, 2019 was $10.6 million, or 1.17% of portfolio loans, compared to $10.0 million, or 1.14% of portfolio loans as of December 31, 2018. Non-performing loans and other real estate owned (“REO’) as of December 31, 2019 was $8.4 million, up from $410 thousand at December 31, 2018. The increases in nonperforming loans have sufficient loan loss allowance in place at year end and the loan balances are well collateralized. See Table 10 for additional details and trends regarding asset quality.

SBA Loans Held for Sale:

SBA loans held for sale at December 31, 2019 were $28.8 million, down $16.8 million from December 31, 2018. Management has decided, at least in the near term, to sell more of its SBA loan production on the balance sheet due to the higher gain on sale premium compared to previous year. These loans are classified as held for sale on the balance sheet.

SBA loan production for the quarter ended December 31, 2019 was $30.8 million compared to $50.1 million in the same quarter last year. SBA loan production was $137.0 million for the twelve months ended December 31, 2019 compared with $189.4 million in the same period last year. See the Table 7 for additional SBA loan origination and sale data. The lower production in 2019 was due in part, to the first quarter 2019 Government shutdown, which adversely affected our SBA program.

Deposits:

Total deposits were $973.3 million at December 31, 2019, a decrease of $35.3 million, or 3.5% since December 31, 2018. Of this decrease, $25.6 million, or 2.53% of the deposit decline was in wholesale certificates of deposit as a result of our continual efforts to obtain low cost core deposits. As noted above, management is taking steps to broaden and diversify its funding sources including placing more emphasis on savings and money market accounts and less emphasis on short term certificates of deposit.

Borrowings:

Borrowings at December 31, 2019 consisted of $25.0 million of Federal Home Loan Bank of San Francisco (FHLB-SF) advances due in 2020, up $15 million from December 31, 2018. Borrowing capacity at the FHLB-SF was $328 million (with $309 million or 94% being available) at December 31, 2019 compared to $359 million (with $326 million or 91% being available) as of December 31, 2018.

Capital:

Stockholder’s equity at December 31, 2019 was $148.1 million compared to $131.9 million at December 31, 2018. This represents an increase of $16.1 million or 12.3% over the prior period. Book value per share at quarter end was $14.52 compared with $13.06 at December 31, 2018, an increase of $1.46 per share or 11.2%. Capital growth during the year primarily consisted of net income of $13.3 million, unrealized gains on investment securities of $2.0 million and $789 thousand related to stock-based compensation.

All regulatory capital ratios increased at December 31, 2019 from their levels at December 31, 2018. The change in the ratios is due to net capital growth, substantially from retained earnings, growing faster than regulatory capital requirements. Additionally, all regulatory capital levels and ratios exceed the minimum required to be considered “Well Capitalized” as defined for bank regulatory purposes and in compliance with the fully phased-in Basel III requirements, which went into effect on January 1, 2019, as shown on Table 11 in this press release.

About CBB Bancorp, Inc.:

CBB Bancorp, Inc. is the holding company of Commonwealth Business Bank, a full-service commercial bank which specializes in small-to medium-sized businesses and does business as “CBB Bank.” The Bank has eight full-service branches in Los Angeles and Orange Counties in California, and Dallas County in Texas; two SBA regional offices in Los Angeles and Dallas Counties; and six loan production offices in Texas, Georgia, Colorado and Washington.

For additional information, please go to www.cbb-bank.com.

FORWARD-LOOKING STATEMENTS:

This news release contains a number of forward-looking statements. These statements may be identified by use of words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “likely,” “may,” “outlook,” “plan,” “potential,” “predict,” “project,” “should,” “will,” “would” and similar terms and phrases, including references to assumptions. Forward-looking statements are based upon various assumptions and analyses made by the Company in light of management’s experience and its perception of historical trends, current conditions and expected future developments, as well as other factors it believes are appropriate under the circumstances. These statements are not guaranteeing of future performance and are subject to risks, uncertainties and other factors (many of which are beyond the Company’s control) that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. You should not place undue reliance on such statements. Factors that could affect our results include, without limitation, the following: the timing and occurrence or non-occurrence of events may be subject to circumstances beyond the Company’s control; increases in competitive pressure among financial institutions or from non-financial institutions; changes in the interest rate environment may reduce interest margins; changes in deposit flows, loan demand or real estate values may adversely affect the business of the Company and the Bank; unanticipated or significant increases in loan losses; changes in accounting principles, policies or guidelines may cause the Company’s financial condition to be perceived differently; changes in corporate and/or individual income tax laws may adversely affect the Company’s financial condition or results of operations; general economic conditions, either nationally or locally in some or all areas in which the Company conducts business, or conditions in the securities markets or the banking industry may be less favorable than the Company currently anticipates; legislation or regulatory changes may adversely affect the Company’s business; technological changes may be more difficult or expensive than the Company anticipates; there may be failures or breaches of information technology security systems; success or consummation of new business initiatives may be more difficult or expensive than the Company anticipates; or litigation or other matters before regulatory agencies, whether currently existing or commencing in the future, may delay the occurrence or non-occurrence of events longer than the Company anticipates. The Company undertakes no obligation to revise any forward-looking statement contain herein to reflect any future events or circumstances, except to the extent required by law.

Schedules and Financial Data: All tables and data to follow;

STATEMENT OF INCOME AND PERFORMANCE HIGHLIGHT (Unaudited) - Table 1

(Dollars in thousands, except per share amounts)

Three Months Ended

 

Twelve Months Ended

December 31,

 

September 30,

 

$

%

 

December 31,

 

$

%

 

December 31,

 

December 31,

 

$

%

 

2019

 

 

 

2019

 

 

Change

Change

 

 

2018

 

 

Change

Change

 

 

2019

 

 

 

2018

 

 

Change

Change

 
Interest income

$

15,254

 

$

15,888

 

$

(634

)

(4.0

%)

$

16,256

 

$

(1,002

)

(6.2

%)

$

63,022

 

$

59,347

 

$

3,675

 

6.2

%

Interest expense

 

4,517

 

 

4,977

 

 

(460

)

(9.2

%)

 

4,035

 

 

482

 

11.9

%

 

18,656

 

 

13,188

 

 

5,468

 

41.5

%

Net interest income

 

10,737

 

 

10,911

 

 

(174

)

(1.6

%)

 

12,221

 

 

(1,484

)

(12.1

%)

 

44,366

 

 

46,159

 

 

(1,793

)

(3.9

%)

 
Provision for loan losses

 

700

 

 

300

 

 

400

 

133.3

%

 

170

 

 

530

 

311.8

%

 

1,300

 

 

1,370

 

 

(70

)

(5.1

%)

Net interest income after provision for loan losses

 

10,037

 

 

10,611

 

 

(574

)

(5.4

%)

 

12,051

 

 

(2,014

)

(16.7

%)

 

43,066

 

 

44,789

 

 

(1,723

)

(3.8

%)

 
Gain on sale of loans

 

1,481

 

 

1,396

 

 

85

 

6.1

%

 

996

 

 

485

 

48.7

%

 

6,153

 

 

7,847

 

 

(1,694

)

(21.6

%)

Gain (loss) on sale of OREO

 

-

 

 

-

 

 

-

 

-

 

 

-

 

 

-

 

-

 

 

(14

)

 

(43

)

 

29

 

67.4

%

SBA servicing fee income, net

 

413

 

 

523

 

 

(110

)

(21.0

%)

 

179

 

 

234

 

130.7

%

 

1,751

 

 

1,286

 

 

465

 

36.2

%

SBA servicing right impairment

 

-

 

 

-

 

 

-

 

-

 

 

(374

)

 

374

 

100.0

%

 

-

 

 

(908

)

 

908

 

100.0

%

Service charges and other income

 

416

 

 

505

 

 

(89

)

(17.6

%)

 

484

 

 

(68

)

(14.0

%)

 

1,955

 

 

2,156

 

 

(201

)

(9.3

%)

Noninterest income

 

2,310

 

 

2,424

 

 

(114

)

(4.7

%)

 

1,285

 

 

1,025

 

79.8

%

 

9,845

 

 

10,338

 

 

(493

)

(4.8

%)

 
Salaries and employee benefits

 

5,355

 

 

5,132

 

 

223

 

4.3

%

 

4,988

 

 

367

 

7.4

%

 

21,052

 

 

19,605

 

 

1,447

 

7.4

%

Occupancy and equipment

 

978

 

 

869

 

 

109

 

12.5

%

 

886

 

 

92

 

10.4

%

 

3,510

 

 

3,445

 

 

65

 

1.9

%

Marketing expense

 

119

 

 

302

 

 

(183

)

(60.6

%)

 

433

 

 

(314

)

(72.5

%)

 

1,155

 

 

995

 

 

160

 

16.1

%

Professional expense

 

417

 

 

691

 

 

(274

)

(39.7

%)

 

1,195

 

 

(778

)

(65.1

%)

 

2,320

 

 

2,593

 

 

(273

)

(10.5

%)

Other expenses

 

1,487

 

 

1,203

 

 

284

 

23.6

%

 

901

 

 

586

 

65.0

%

 

6,081

 

 

5,398

 

 

683

 

12.7

%

Noninterest expense

 

8,356

 

 

8,197

 

 

159

 

1.9

%

 

8,403

 

 

(47

)

(0.6

%)

 

34,118

 

 

32,036

 

 

2,082

 

6.5

%

 
Income before income tax expense

 

3,991

 

 

4,838

 

 

(847

)

(17.5

%)

 

4,933

 

 

(942

)

(19.1

%)

 

18,793

 

 

23,091

 

 

(4,298

)

(18.6

%)

 
Income tax expense

 

1,137

 

 

1,421

 

 

(284

)

(20.0

%)

 

1,278

 

 

(141

)

(11.0

%)

 

5,449

 

 

6,433

 

 

(984

)

(15.3

%)

 
Net income

$

2,854

 

$

3,417

 

$

(563

)

(16.5

%)

$

3,655

 

$

(801

)

(21.9

%)

$

13,344

 

$

16,658

 

$

(3,314

)

(19.9

%)

 
Effective tax rate

 

28.5

%

 

29.4

%

 

(0.9

%)

(3.0

%)

 

25.9

%

 

2.6

%

10.0

%

 

29.0

%

 

27.9

%

 

1.1

%

4.1

%

 
Outstanding number of shares

 

10,197,380

 

 

10,170,760

 

 

26,620

 

0.3

%

 

10,102,161

 

 

95,219

 

0.9

%

 

10,197,380

 

 

10,102,161

 

 

95,219

 

0.9

%

 
Weighted average shares for basic EPS

 

10,188,700

 

 

10,141,086

 

 

47,614

 

0.5

%

 

10,098,618

 

 

90,082

 

0.9

%

 

10,139,648

 

 

10,051,485

 

 

88,163

 

0.9

%

Weighted average shares for diluted EPS

 

10,336,793

 

 

10,321,937

 

 

14,856

 

0.1

%

 

10,390,326

 

 

(53,533

)

(0.5

%)

 

10,335,831

 

 

10,412,833

 

 

(77,002

)

(0.7

%)

 
Basic EPS

$

0.28

 

$

0.34

 

$

(0.06

)

-17.6

%

$

0.36

 

$

(0.08

)

(22.2

%)

$

1.32

 

$

1.66

 

$

(0.34

)

(20.5

%)

Diluted EPS

$

0.28

 

$

0.33

 

$

(0.05

)

-15.2

%

$

0.35

 

$

(0.07

)

(20.0

%)

$

1.29

 

$

1.60

 

$

(0.31

)

(19.4

%)

 
Return on average assets

 

0.97

%

 

1.15

%

 

(0.18

%)

(15.65

%)

 

1.25

%

 

(0.28

%)

(22.40

%)

 

1.15

%

 

1.50

%

 

(0.35

%)

(23.33

%)

Return on average equity

 

7.66

%

 

9.44

%

 

(1.78

%)

(18.86

%)

 

11.16

%

 

(3.50

%)

(31.36

%)

 

9.45

%

 

13.49

%

 

(4.04

%)

(29.95

%)

 
Efficiency ratio¹

 

64.05

%

 

61.47

%

 

2.58

%

4.20

%

 

62.22

%

 

1.83

%

2.95

%

 

62.94

%

 

56.70

%

 

6.24

%

11.01

%

Yield on interest-earning assets²

 

5.35

%

 

5.49

%

 

(0.14

%)

(2.55

%)

 

5.73

%

 

(0.38

%)

(6.63

%)

 

5.58

%

 

5.53

%

 

0.05

%

0.90

%

Cost of funds

 

1.79

%

 

1.93

%

 

(0.14

%)

(7.25

%)

 

1.57

%

 

0.22

%

14.03

%

 

1.85

%

 

1.35

%

 

0.50

%

37.04

%

Net interest margin²

 

3.77

%

 

3.78

%

 

(0.01

%)

(0.26

%)

 

4.32

%

 

(0.55

%)

(12.64

%)

 

3.94

%

 

4.30

%

 

(0.36

%)

(8.37

%)

¹

Represents the ratio of noninterest expense less other real estate owned operations to the sum of net interest income before provision for credit losses and total noninterest income, less gains/(loss) on sale of securities, other-than-temporary impairment recovery/(loss) on investment securities and gain/(loss) from other real estate owned.

²

Amounts calculated on a fully taxable equivalent basis using the current statutory federal tax rate

BALANCE SHEET, CAPITAL AND OTHER DATA (Unaudited) - Table 2

(Dollars in thousands)

 

December 31,

 

September 30,

 

$

%

 

December 31,

 

$

%

2019

 

2019

 

Change

Change

 

2018

 

Change

Change

ASSETS
Cash and due from banks

$ 10,059

$ 12,448

$ (2,389)

(19.2%)

$ 11,029

$ (970)

(8.8%)

Interest-earning deposits at the FRB and other banks

93,259

72,907

20,352

27.9%

97,211

(3,952)

(4.1%)

Investment securities¹

94,640

97,141

(2,501)

(2.6%)

104,431

(9,791)

(9.4%)

Loans held-for-sale, at the lower of cost or fair value

28,826

42,132

(13,306)

(31.6%)

45,665

(16,839)

(36.9%)

 
Loans receivable

906,875

905,004

1,871

0.2%

875,797

31,078

3.5%

Allowance for loan losses

(10,596)

(9,978)

(618)

(6.2%)

(10,023)

(573)

(5.7%)

Loans receivable, net

896,279

895,026

1,253

0.1%

865,774

30,505

3.5%

 
OREO

362

11

351

3190.9%

25

337

1348.0%

Restricted stock investments

8,194

8,194

-

-

7,879

315

4.0%

Servicing assets

9,697

9,953

(256)

(2.6%)

10,541

(844)

(8.0%)

Other assets

21,372

21,885

(513)

(2.3%)

18,519

2,853

15.4%

Total assets

$ 1,162,688

$ 1,159,697

$ 2,991

0.3%

$ 1,161,074

$ 1,614

0.1%

 
LIABILITIES AND STOCKHOLDERS' EQUITY
Noninterest-bearing

$ 209,484

$ 200,034

$ 9,450

4.7%

$ 206,764

$ 2,720

1.3%

Interest-bearing

763,822

789,280

(25,458)

(3.2%)

801,830

(38,008)

(4.7%)

Total deposits

973,306

989,314

(16,008)

(1.6%)

1,008,594

(35,288)

(3.5%)

 
FHLB advances

25,000

10,000

15,000

150.0%

10,000

15,000

150.0%

Other liabilities

16,298

15,164

1,134

7.5%

10,567

5,731

54.2%

Total liabilities

1,014,604

1,014,478

126

0.0%

1,029,161

(14,557)

(1.4%)

 
Stockholders' Equity

148,084

145,219

2,865

2.0%

131,913

16,171

12.3%

TOTAL LIABILITIES & STOCKHOLDERS' EQUITY

$ 1,162,688

$ 1,159,697

$ 2,991

0.3%

$ 1,161,074

$ 1,614

0.1%

 
CAPITAL RATIOS
Leverage ratio
Company

12.59%

12.14%

0.45%

3.71%

11.39%

1.20%

10.54%

Bank

12.55%

12.10%

0.45%

3.72%

11.36%

1.19%

10.48%

Common equity tier 1 risk-based capital ratio
Company

14.96%

14.71%

0.25%

1.70%

14.27%

0.69%

4.84%

Bank

14.91%

14.66%

0.25%

1.71%

14.24%

0.67%

4.71%

Tier 1 risk-based capital ratio
Company

14.96%

14.71%

0.25%

1.70%

14.27%

0.69%

4.84%

Bank

14.91%

14.66%

0.25%

1.71%

14.24%

0.67%

4.71%

Total risk-based capital ratio
Company

16.13%

15.80%

0.33%

2.09%

15.42%

0.71%

4.60%

Bank

16.08%

15.75%

0.33%

2.10%

15.38%

0.70%

4.55%

Book value per share

$ 14.52

$ 14.28

$ 0.24

1.7%

$ 13.06

$ 1.46

11.2%

Loan-to-Deposit (LTD) ratio

93.17%

91.48%

1.69%

1.85%

86.83%

6.34%

7.30%

Nonperforming assets

8,392

5,134

3,258

63.5%

410

$ 7,982

1946.83%

Nonperforming assets as a % of loans receivable

0.89%

0.57%

0.32%

56.14%

0.04%

0.85%

2125.00%

ALLL as a % of loans receivable

1.17%

1.10%

0.07%

6.36%

1.14%

0.03%

2.63%

¹

Includes AFS and HTM

FIVE-QUARTER STATEMENT OF INCOME (Unaudited) - Table 3
(Dollars in thousands, except per share amounts)
Three Months Ended

December 31,

 

September 30,

 

June 30,

 

March 31,

 

December 31,

2019

 

2019

 

2019

 

2019

 

2018

 
Interest income

$ 15,254

$ 15,888

$ 16,296

$ 15,584

$ 16,256

Interest expense

4,517

4,977

4,865

4,297

4,035

Net interest income

10,737

10,911

11,431

11,287

12,221

 
Provision for loan losses

700

300

300

-

170

Net interest income after provision for loan losses

10,037

10,611

11,131

11,287

12,051

 
Gain on sale of loans

1,481

1,396

2,109

1,167

996

Gain (loss) on sale of OREO

-

-

(4)

(10)

-

SBA servicing fee income, net

413

523

312

503

179

SBA servicing right impairment

-

-

-

-

(374)

Service charges and other income

416

505

577

457

484

Noninterest income

2,310

2,424

2,994

2,117

1,285

 
Salaries and employee benefits

5,355

5,132

5,467

5,098

4,988

Occupancy and equipment

978

869

831

832

886

Marketing expense

119

302

989

520

433

Professional expense

417

691

574

638

1,195

Other expenses

1,487

1,203

1,340

1,276

901

Noninterest expense

8,356

8,197

9,201

8,364

8,403

 
Income before income tax expense

3,991

4,838

4,924

5,040

4,933

 
Income tax expense

1,137

1,421

1,441

1,450

1,278

 
Net income

$ 2,854

$ 3,417

$ 3,483

$ 3,590

$ 3,655

 
Effective tax rate

28.5%

29.4%

29.3%

28.8%

25.9%

 
Outstanding number of shares

10,197,380

10,170,760

10,140,760

10,107,485

10,102,161

 
Weighted average shares for basic EPS

10,188,700

10,141,086

10,125,622

10,102,220

10,098,618

Weighted average shares for diluted EPS

10,336,793

10,321,937

10,341,488

10,359,833

10,390,326

 
Basic EPS

$ 0.28

$ 0.34

$ 0.34

$ 0.36

$ 0.36

Diluted EPS

$ 0.28

$ 0.33

$ 0.33

$ 0.35

$ 0.35

QUARTERLY SALARIES BENEFIT METRICS (Unaudited) - Table 4
(Dollars in thousands)

At or for the Three Months Ended

December 31,

 

September 30,

 

June 30,

 

March 31,

 

December 31,

 

2019

 

2019

 

2019

 

2019

 

2018

 

 

Salaries and benefits

$ 5,355

$ 5,132

$ 5,467

$ 5,098

$ 4,988

FTE at the end of period

190

190

192

186

187

Average FTE during the period

191

191

192

185

185

Salaries and benefits/average FTE¹

$ 111

$ 106

$ 114

$ 112

$ 107

Salaries and benefits/average assets¹

1.83%

1.72%

1.87%

1.82%

1.71%

Noninterest expense/average assets¹

2.85%

2.75%

3.15%

2.99%

2.87%

¹

Annualized

FIVE-QUARTER BALANCE SHEET (Unaudited) - Table 5

(Dollars in thousands)

 

 

 

 

 

 

 

 

 

December 31,

 

September 30,

 

June 30,

 

March 31,

 

December 31,

2019

 

2019

 

2019

 

2019

 

2018

ASSETS
Cash and due from banks

$ 10,059

$ 12,448

$ 12,369

$ 10,837

$ 11,029

Interest-earning deposits at the FRB and other banks

93,259

72,907

127,199

111,305

97,211

Investment securities¹

94,640

97,141

99,758

101,825

104,431

Loans held-for-sale, at the lower of cost or fair value

28,826

42,132

46,875

45,275

45,665

 
Loans receivable

906,875

905,004

881,614

874,330

875,797

Allowance for loan losses

(10,596)

(9,978)

(10,019)

(9,760)

(10,023)

Loans receivable, net

896,279

895,026

871,595

864,570

865,774

 
OREO

362

11

11

15

25

Restricted stock investments

8,194

8,194

8,194

7,879

7,879

Servicing assets

9,697

9,953

10,174

10,303

10,541

Other assets

21,372

21,885

22,662

25,610

18,519

Total assets

$ 1,162,688

$ 1,159,697

$ 1,198,837

$ 1,177,619

$ 1,161,074

 
 
LIABILITIES AND STOCKHOLDERS' EQUITY
Noninterest-bearing

$ 209,484

$ 200,034

$ 202,657

$ 198,940

$ 206,764

Interest-bearing

763,822

789,280

829,088

816,603

801,830

Total deposits

973,306

989,314

1,031,745

1,015,543

1,008,594

 
FHLB advances

25,000

10,000

10,000

10,000

10,000

Other liabilities

16,298

15,164

15,990

15,595

10,567

Total liabilities

1,014,604

1,014,478

1,057,735

1,041,138

1,029,161

 
Stockholders' Equity

148,084

145,219

141,102

136,481

131,913

TOTAL LIABILITIES & STOCKHOLDERS' EQUITY

$ 1,162,688

$ 1,159,697

$ 1,198,837

$ 1,177,619

$ 1,161,074

¹

Includes AFS and HTM

FIVE-QUARTER LOANS RECEIVABLE COMPONENTS (Unaudited) - Table 6

(Dollars in thousands)

December 31,

 

September 30,

 

June 30, 2019

 

March 31, 2019

 

December 31, 2018

Balance

 

%

 

Balance

 

%

 

Balance

 

%

 

Balance

 

%

 

Balance

 

%

 
Construction

$ 16,957

1.9%

$ 18,477

2.0%

$ 17,853

2.0%

$ 15,043

1.7%

$ 12,327

1.4%

Commercial real estate

746,969

82.4%

725,096

80.1%

691,859

78.5%

695,367

79.5%

703,088

80.3%

Commercial and industrial

135,412

14.9%

153,306

16.9%

164,089

18.6%

156,352

17.9%

152,381

17.4%

Consumer

5,184

0.6%

5,389

0.6%

5,366

0.6%

5,015

0.6%

5,548

0.6%

Gross loans

904,522

99.7%

902,268

99.7%