LOS ANGELES--(BUSINESS WIRE)--CBB Bancorp, Inc. ("CBB" or the "Company') (OTCQX: CBBI), the holding company of Commonwealth Business Bank, doing business as "CBB Bank" (the "Bank"), announced today net income of $5.5 million for the second quarter 2024, or $0.51 per diluted share compared to $5.7 million in the first quarter 2024, or $0.54 per diluted share.
OVERALL RESULTS
Net income for the second quarter 2024 decreased from the first quarter primarily due to lower net interest income and gain on sale of loans, offset by a lower provision for credit losses and noninterest expenses. The return on average assets for the second quarter 2024 was 1.31% compared to 1.32% for the first quarter 2024 and 1.79% for the second quarter 2023. The return on average equity for the second quarter 2024 was 9.06% compared to 9.57% for the first quarter 2024 and 14.76% for the second quarter 2023. The efficiency ratio for the second quarter 2024 was 55.69% compared to 54.68% for the first quarter 2024 and 47.29% for the second quarter 2023.
James Hong, President and CEO, commented, "Amidst the dynamic economic environment, we are charting a course through a landscape of changes exploring new opportunities. While the rise in interest rates presents its own set of challenges, it also opens up avenues for growth. Our loan portfolios, funding costs, net interest margins, and overall revenue are being reshaped in this process. Embracing these changes, we have turned to technology as our ally. We have seen a robust increase in the adoption of online account openings, internet banking, and mobile banking among our existing and new customers. This is a testament to our resilience and adaptability in the face of adversity."
INCOME STATEMENT
Net Interest Income
Net interest income for the second quarter 2024 was $15.4 million, a decrease of $444 thousand, or 2.8%, quarter over quarter, and a decrease of $3.4 million, or 18.0% compared to the second quarter 2023.
Net interest income for the six months ended June 30, 2024 was $31.2 million, a decrease of $6.6 million or 17.6% compared to the same period last year. The decrease in net interest income was due to the higher cost of interest-bearing deposits as maturing time deposits were rolled over into higher interest rate CDs.
Net Interest Margin
The net interest margin for both the second and first quarters 2024 was 3.77% and 4.23% for the second quarter 2023. The decrease in the net interest margin compared to the same quarter 2023 was due to higher cost of funds. The cost of funds for the second quarter 2024 increased four basis points to 3.52% compared to 3.48% in the previous quarter and 2.53% in the second quarter 2023.
Provision for Credit Losses
Provision for credit losses was $200 thousand for the second quarter 2024 compared to $400 thousand in the first quarter 2024. No provision for credit losses was recorded in the second quarter 2023.
Noninterest Income
Noninterest income for the second quarter 2024 was $2.3 million, a decrease of $226 thousand compared to $2.6 million for the first quarter 2024, and a decrease of $464 thousand compared to $2.8 million for the second quarter 2023. The decrease in noninterest income was primarily the result of lower gain on sale of loans offset by higher SBA servicing fee income.
Noninterest income for the six months ended June 30, 2024 was $4.9 million, an increase of $1.0 million compared to the same period last year. The increase was primarily the result of higher gain on sale of loans and SBA servicing fee income.
Noninterest Expenses
Noninterest expenses for the second quarter 2024 were $9.9 million compared to $10.0 million for the first quarter 2024 and $10.2 million for the second quarter 2023. Noninterest expenses decreased $188 thousand and $327 thousand compared to the first quarter 2024 and the second quarter 2023, respectively.
Please refer to financial tables in this press release for additional information and trends.
Income Taxes
The Company's effective tax rate for the second quarter 2024 was 28.3% compared to 28.4% for first quarter 2024 and 28.6% for second quarter 2023.
BALANCE SHEET
Investment Securities
Investment securities were $73.1 million at June 30, 2024, an increase of $13.9 million or 23.5% from March 31, 2024, and an increase of $6.7 million or 10.0% from June 30, 2023. Management believes that the Bank currently has adequate liquidity and does not need to sell securities for liquidity purposes.
Loans Receivable
Loans receivable (including loans held-for-sale) at June 30, 2024, was $1.44 billion, an increase of $45.0 million or 3.2% from March 31, 2024, and an increase of $21.3 million or 1.5% from June 30, 2023.
Allowance for Credit Losses and Asset Quality
The Allowance for Credit Losses ("ACL") at June 30, 2024, was $16.0 million which was 1.31% of loans held-for-investment compared to $16.0 million at March 31, 2024, or 1.34% of loans held-for-investment. At June 30, 2023, ACL was $15.6 million or 1.30% of total loans held-for-investment. Total Nonperforming assets at June 30, 2024, were $5.8 million compared to $4.4 million at March 31, 2024 and $0.7 million at June 30, 2023. The ACL coverage to nonperforming assets was over 276% at June 30, 2024.
SBA Loans Held-for-Sale
Total SBA loans held-for-sale at June 30, 2024, was $209.1 million compared to $ 198.2 million March 31, 2024, and $215.1 million at June 30, 2023. We continue to assess the SBA loan market premium and plan to sell loans when it is advantageous to do so.
The Bank sold approximately $19.5 million in SBA loans with an average premium of 8.3% during the second quarter of 2024 compared to the sale of $28.2 million with an average premium of 8.4% in the first quarter of 2024. The Bank sold approximately $42.4 million of SBA loans with an average premium of 6.8% during the second quarter 2023.
Deposits
Total deposits were $1.34 billion at June 30, 2024, down $20.6 million or 1.5% from March 31, 2024, and down $182.0 million or 12.0% from June 30, 2023. DDAs were 21.6% of total deposits for both June 30, 2024 and March 31, 2024, and 28.6% at June 30, 2023. NOW and MMDA deposits comprised 18.0% of total deposits at June 30, 2024, compared to 16.9% at March 31, 2024, and 13.8% at June 30, 2023. The quarter-over-quarter and year-over-year decline in DDA can be attributed to the higher interest rate environment. Depositors were eager to capitalize on the rising interest rates, moving funds from DDA to Savings, MMDA, CD, or some combination thereof.
Borrowings
The Bank has maintained $50.0 million in Federal Home Loan Bank advances since April 16, 2020. The blended cost of FHLB advances was 0.94% as of June 30, 2024.
Capital
Stockholders' equity was $245.3 million at June 30, 2024, which increased $4.7 million or 1.9%, quarter over quarter. Tangible book value per share at June 30, 2024, was $22.94, an increase of $0.45, or 2.0%, quarter over quarter.
Each of the Company's and the Bank's regulatory capital ratios decreased, except for the leverage ratio at June 30, 2024, compared to March 31, 2024, and increased compared to June 30, 2023. Capital ratios continue to exceed the minimum levels required to be considered "Well Capitalized" under the applicable regulatory capital rules.
The Common Equity Tier 1 Risk-Based Capital Ratios at June 30, 2024, were 18.36% and 18.28% for the Company and the Bank, respectively. Total Risk-Based Capital Ratios were 19.59% and 19.50% for the Company and the Bank, respectively.
About CBB Bancorp, Inc.:
CBB Bancorp, Inc. is the holding company of Commonwealth Business Bank, a full-service commercial bank which specializes in loans to small-to-medium-sized businesses and does business as "CBB Bank." As of June 30, 2024, the Bank had eleven full-service banking offices in Los Angeles and Orange Counties in California, Dallas County in Texas and Honolulu, Hawaii; two SBA regional offices in Los Angeles and Dallas Counties; and loan production offices in Georgia and Washington. For additional information, please go to www.cbb-bank.com under the tab "About Us" and select "Investor Relations" to see the 2Q 2024 Overview.
FORWARD-LOOKING STATEMENTS:
This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. CBB Bancorp, Inc. (the "Company") intends that such forward-looking statements be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Future events are difficult to predict, and the expectations described herein are necessarily subject to risks and uncertainties that may cause actual results to differ materially and adversely from those described herein. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words "believe," "expect," "anticipate," "intend," "plan," "estimate," or words of similar meaning, or future or conditional verbs such as "will," "would," "should," "could," or "may." These forward-looking statements are not guarantees of future performance, nor should they be relied upon as representing management's views as of any subsequent date. Factors that might cause actual results to differ materially from those presented, either expressed or implied, in this news release include, but are not limited to: the Company's ability to successfully execute its business plans and achieve its objectives; changes in general economic and financial market conditions, either nationally or locally in areas in which the Company conducts its operations; changes in interest rates; continuing consolidation in the financial services industry; new litigation or changes in existing litigation; increased competitive challenges and expanding product and pricing pressures among financial institutions; legislation or regulatory changes which adversely affect the Company's operations or business; loss of key personnel; and changes in accounting policies or procedures as may be required by the Financial Accounting Standards Board or other regulatory agencies.
The Company undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent 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 | Six Months Ended | |||||||||||||||||||||||||||||||||||||
June 30, | March 31, | $ | % | June 30, | $ | % | June 30, | June 30, | $ | % | ||||||||||||||||||||||||||||
2024 | 2024 | Change | Change | 2023 | Change | Change | 2024 | 2023 | Change | Change | ||||||||||||||||||||||||||||
| Interest income | $ | 27,755 | $ | 28,463 | $ | (708 | ) | (2.5 | %) | $ | 28,664 | $ | (909 | ) | (3.2 | %) | $ | 56,218 | $ | 55,912 | $ | 306 | 0.5 | % | ||||||||||||||
| Interest expense | 12,391 | 12,655 | (264 | ) | (2.1 | %) | 9,930 | 2,461 | 24.8 | % | 25,046 | 18,098 | 6,948 | 38.4 | % | |||||||||||||||||||||||
| Net interest income | 15,364 | 15,808 | (444 | ) | (2.8 | %) | 18,734 | (3,370 | ) | (18.0 | %) | 31,172 | 37,814 | (6,642 | ) | (17.6 | %) | |||||||||||||||||||||
| Provision for credit losses | 200 | 400 | (200 | ) | (50.0 | %) | - | 200 | 100.0 | % | 600 | - | 600 | 100.0 | % | |||||||||||||||||||||||
| Net interest income after provision for credit losses | 15,164 | 15,408 | (244 | ) | (1.6 | %) | 18,734 | (3,570 | ) | (19.1 | %) | 30,572 | 37,814 | (7,242 | ) | (19.2 | %) | |||||||||||||||||||||
| Gain on sale of loans | 1,064 | 1,489 | (425 | ) | -28.5 | % | 1,952 | (888 | ) | 319.8 | % | 2,553 | 1,952 | 601 | 30.8 | % | ||||||||||||||||||||||
| Gain (loss) on sale of OREO | - | (1 | ) | 1 | (100.0 | %) | - | - | - | (1 | ) | - | (1 | ) | (100.0 | %) | ||||||||||||||||||||||
| SBA servicing fee income, net | 768 | 633 | 135 | 21.3 | % | 440 | 328 | 74.5 | % | 1,401 | 1,094 | 307 | 28.1 | % | ||||||||||||||||||||||||
| Recovery on impaired servicing liability | - | 10 | (10 | ) | (100.0 | %) | - | - | - | 10 | - | 10 | 100.0 | % | ||||||||||||||||||||||||
| Service charges and other income | 503 | 430 | 73 | 17.0 | % | 407 | 96 | 23.6 | % | 933 | 805 | 128 | 15.9 | % | ||||||||||||||||||||||||
| Noninterest income | 2,335 | 2,561 | (226 | ) | (8.8 | %) | 2,799 | (464 | ) | (16.6 | %) | 4,896 | 3,851 | 1,045 | 27.1 | % | ||||||||||||||||||||||
| Salaries and employee benefits | 5,927 | 6,024 | (97 | ) | (1.6 | %) | 5,581 | 346 | 6.2 | % | 11,951 | 11,660 | 291 | 2.5 | % | |||||||||||||||||||||||
| Occupancy and equipment | 1,114 | 1,122 | (8 | ) | (0.7 | %) | 1,122 | (8 | ) | (0.7 | %) | 2,236 | 2,246 | (10 | ) | (0.4 | %) | |||||||||||||||||||||
| Marketing expense | 403 | 402 | 1 | 0.2 | % | 409 | (6 | ) | (1.5 | %) | 805 | 783 | 22 | 2.8 | % | |||||||||||||||||||||||
| Professional expense | 440 | 412 | 28 | 6.8 | % | 436 | 4 | 0.9 | % | 852 | 890 | (38 | ) | (4.3 | %) | |||||||||||||||||||||||
| Other expenses | 1,972 | 2,084 | (112 | ) | (5.4 | %) | 2,635 | (663 | ) | (25.2 | %) | 4,056 | 4,879 | (823 | ) | (16.9 | %) | |||||||||||||||||||||
| Noninterest expense | 9,856 | 10,044 | (188 | ) | (1.9 | %) | 10,183 | (327 | ) | (3.2 | %) | 19,900 | 20,458 | (558 | ) | (2.7 | %) | |||||||||||||||||||||
| Income before income tax provision | 7,643 | 7,925 | (282 | ) | (3.6 | %) | 11,350 | (3,707 | ) | (32.7 | %) | 15,568 | 21,207 | (5,639 | ) | (26.6 | %) | |||||||||||||||||||||
| Income tax provision | 2,163 | 2,253 | (90 | ) | (4.0 | %) | 3,248 | (1,085 | ) | (33.4 | %) | 4,416 | 6,015 | (1,599 | ) | (26.6 | %) | |||||||||||||||||||||
| Net income | $ | 5,480 | $ | 5,672 | $ | (192 | ) | (3.4 | %) | $ | 8,102 | $ | (2,622 | ) | (32.4 | %) | $ | 11,152 | $ | 15,192 | $ | (4,040 | ) | (26.6 | %) | |||||||||||||
| Effective tax rate | 28.3 | % | 28.4 | % | (0.1 | %) | (0.5 | %) | 28.6 | % | (0.3 | %) | (1.1 | %) | 28.4 | % | 28.4 | % | 0.00 | % | 0.0 | % | ||||||||||||||||
| Outstanding number of shares | 10,588,136 | 10,588,136 | - | - | 10,588,136 | - | - | 10,588,136 | 10,588,136 | - | - | |||||||||||||||||||||||||||
| Weighted average shares for basic EPS | 10,588,136 | 10,588,136 | - | - | 10,588,136 | - | - | 10,588,136 | 10,582,197 | 5,939 | 0.1 | % | ||||||||||||||||||||||||||
| Weighted average shares for diluted EPS | 10,588,136 | 10,588,688 | (552 | ) | (0.0 | %) | 10,591,350 | (3,214 | ) | (0.0 | %) | 10,558,688 | 10,595,803 | (37,115 | ) | (0.4 | %) | |||||||||||||||||||||
| Basic EPS | $ | 0.51 | $ | 0.54 | $ | (0.03 | ) | (5.6 | %) | $ | 0.77 | $ | (0.26 | ) | (33.8 | %) | $ | 1.05 | $ | 1.44 | $ | (0.39 | ) | -27.1 | % | |||||||||||||
| Diluted EPS | $ | 0.51 | $ | 0.54 | $ | (0.03 | ) | (5.6 | %) | $ | 0.76 | $ | (0.25 | ) | (32.9 | %) | $ | 1.05 | $ | 1.43 | $ | (0.38 | ) | (26.6 | %) | |||||||||||||
| Return on average assets | 1.31 | % | 1.32 | % | (0.01 | %) | (0.8 | %) | 1.79 | % | (0.48 | %) | (26.8 | %) | 1.32 | % | 1.69 | % | (0.37 | %) | (21.9 | %) | ||||||||||||||||
| Return on average equity | 9.06 | % | 9.57 | % | (0.51 | %) | (5.3 | %) | 14.76 | % | (5.70 | %) |
(38.6 | %) | 9.31 | % | 14.12 | % | (4.81 | %) | (34.1 | %) | ||||||||||||||||
| Efficiency ratio¹ | 55.69 | % | 54.68 | % | 1.01 | % | 1.9 | % | 47.29 | % | 8.40 | % | 17.8 | % | 55.17 | % | 49.10 | % | 6.07 | % | 12.4 | % | ||||||||||||||||
| Yield on interest-earning assets² | 6.79 | % | 6.77 | % | 0.02 | % | 0.3 | % | 6.46 | % | 0.33 | % | 5.1 | % | 6.78 | % | 6.36 | % | 0.42 | % | 6.6 | % | ||||||||||||||||
| Cost of funds | 3.52 | % | 3.48 | % | 0.04 | % | 1.2 | % | 2.53 | % | 0.99 | % | 39.1 | % | 3.50 | % | 2.32 | % | 1.18 | % | 50.9 | % | ||||||||||||||||
| Net interest margin² | 3.77 | % | 3.77 | % | 0.00 | % | 0.0 | % | 4.23 | % | (0.46 | %) | (10.9 | %) | 3.77 | % | 4.30 | % | (0.53 | %) | (12.3 | %) | ||||||||||||||||
| 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. | |||||||||||||
| 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) | ||||||||||||||||||||||||||
June 30, | March 31, | $ | % | June 30, | $ | % | ||||||||||||||||||||
2024 | 2024 | Change | Change | 2023 | Change | Change | ||||||||||||||||||||
| ASSETS | ||||||||||||||||||||||||||
Cash and due from banks | $ | 11,667 | $ | 11,612 | $ | 55 | 0.5 | % | $ | 12,704 | $ | (1,037 | ) | (8.2 | %) | |||||||||||
| Interest-earning deposits at the FRB and other banks | 101,415 | 181,366 | (79,951 | ) | (44.1 | %) | 293,394 | (191,979 | ) | (65.4 | %) | |||||||||||||||
| Investment securities¹ | 73,051 | 59,143 | 13,908 | 23.5 | % | 66,400 | 6,651 | 10.0 | % | |||||||||||||||||
| Loans held-for-sale | 209,144 | 198,167 | 10,977 | 5.5 | % | 215,083 | (5,939 | ) | (2.8 | %) | ||||||||||||||||
| Loans held-for-investment | 1,228,496 | 1,194,439 | 34,057 | 2.9 | % | 1,201,237 | 27,259 | 2.3 | % | |||||||||||||||||
| Less: Allowance for credit losses ("ACL") | (16,042 | ) | (16,048 | ) | 6 | 0.0 | % | (15,626 | ) | (416 | ) | (2.7 | %) | |||||||||||||
Loans held-for-investment, net | 1,212,454 | 1,178,391 | 34,063 | 2.9 | % | 1,185,611 | 26,843 | 2.3 | % | |||||||||||||||||
Other real estate owned ("OREO") | - | - | - | - | - | - | - | |||||||||||||||||||
| Restricted stock investments | 11,011 | 11,011 | - | - | 11,011 | - | - | |||||||||||||||||||
| Servicing assets | 7,404 | 7,560 | (156 | ) | (2.1 | %) | 8,426 | (1,022 | ) | (12.1 | %) | |||||||||||||||
| Goodwill | 2,185 | 2,185 | - | - | 2,185 | - | - | |||||||||||||||||||
| Intangible assets | 235 | 245 | (10 | ) | (4.1 | %) | 279 | (44 | ) | (15.8 | %) | |||||||||||||||
| Other assets | 26,343 | 23,581 | 2,762 | 11.7 | % | 24,537 | 1,806 | 7.4 | % | |||||||||||||||||
| Total assets | $ | 1,654,909 | $ | 1,673,261 | $ | (18,352 | ) | (1.1 | %) | $ | 1,819,630 | $ | (164,721 | ) | (9.1 | %) | ||||||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||||||||||||||||||
| Noninterest-bearing | $ | 281,243 | $ | 286,766 | $ | (5,523 | ) | (1.9 | %) | $ | 426,333 | $ | (145,090 | ) | (34.0 | %) | ||||||||||
| Interest-bearing | 1,059,146 | 1,074,198 | (15,052 | ) | (1.4 | %) | 1,096,078 | (36,932 | ) | (3.4 | %) | |||||||||||||||
| Total deposits | 1,340,389 | 1,360,964 | (20,575 | ) | (1.5 | %) | 1,522,411 | (182,022 | ) | (12.0 | %) | |||||||||||||||
| FHLB advances and other borrowing | 50,000 | 50,000 | - | - | 50,000 | - | - | |||||||||||||||||||
| Other liabilities | 19,260 | 21,727 | (2,467 | ) | (11.4 | %) | 23,956 | (4,696 | ) | (19.6 | %) | |||||||||||||||
| Total liabilities | 1,409,649 | 1,432,691 | (23,042 | ) | (1.6 | %) | 1,596,367 | (186,718 | ) | (11.7 | %) | |||||||||||||||
| Stockholders' Equity | 245,260 | 240,570 | 4,690 | 1.9 | % | 223,263 | 21,997 | 9.9 | % | |||||||||||||||||
| TOTAL LIABILITIES & STOCKHOLDERS' EQUITY | $ | 1,654,909 | $ | 1,673,261 | $ | (18,352 | ) | (1.1 | %) | $ | 1,819,630 | $ | (164,721 | ) | (9.1 | %) | ||||||||||
| CAPITAL RATIOS | ||||||||||||||||||||||||||
| Leverage ratio | ||||||||||||||||||||||||||
| Company | 14.51 | % | 13.85 | % | 0.66 | % | 4.8 | % | 12.23 | % | 2.28 | % | 18.7 | % | ||||||||||||
| Bank | 14.45 | % | 13.84 | % | 0.61 | % | 4.4 | % | 12.20 | % | 2.25 | % | 18.5 | % | ||||||||||||
| Common equity tier 1 risk-based capital ratio | ||||||||||||||||||||||||||
| Company | 18.36 | % | 18.67 | % | (0.31 | %) | (1.7 | %) | 17.08 | % | 1.28 | % | 7.5 | % | ||||||||||||
| Bank | 18.28 | % | 18.65 | % | (0.38 | %) | (2.0 | %) | 17.03 | % | 1.25 | % | 7.3 | % | ||||||||||||
| Tier 1 risk-based capital ratio | ||||||||||||||||||||||||||
| Company | 18.36 | % | 18.67 | % | (0.31 | %) | (1.7 | %) | 17.08 | % | 1.28 | % | 7.5 | % | ||||||||||||
| Bank | 18.28 | % | 18.65 | % | (0.38 | %) | (2.0 | %) | 17.03 | % | 1.25 | % | 7.3 | % | ||||||||||||
| Total risk-based capital ratio | ||||||||||||||||||||||||||
| Company | 19.59 | % | 19.92 | % | (0.34 | %) | (1.7 | %) | 18.32 | % | 1.27 | % | 6.9 | % | ||||||||||||
| Bank | 19.50 | % | 19.91 | % | (0.40 | %) | (2.0 | %) | 18.27 | % | 1.23 | % | 6.7 | % | ||||||||||||
| Tangible book value per share | $ | 22.94 | $ | 22.49 | $ | 0.45 | 2.0 | % | $ | 20.85 | $ | 2.09 | 10.0 | % | ||||||||||||
| Loans Held for Investments-to-Deposit ("LHFITD") ratio | 91.65 | % | 87.76 | % | 3.89 | % | 4.4 | % | 78.90 | % | 12.75 | % | 16.2 | % | ||||||||||||
| Net Loan-to-Deposit ("LTD") ratio | 106.06 | % | 101.15 | % | 4.91 | % | 4.9 | % | 92.00 | % | 14.06 | % | 15.3 | % | ||||||||||||
| Nonperforming assets | $ | 5,797 | $ | 4,447 | $ | 1,350 | 30.4 | % | $ | 684 | $ | 5,113 | 747.5 | % | ||||||||||||
| Nonperforming assets as a % of loans held-for-investment | 0.47 | % | 0.37 | % | 0.10 | % | 27.0 | % | 0.06 | % | 0.41 | % | 683.3 | % | ||||||||||||
| ACL as a % of loans held-for-investment | 1.31 | % | 1.34 | % | (0.03 | %) | (2.24 | %) | 1.30 | % | 0.01 | % | 0.8 | % | ||||||||||||
| ¹ Includes AFS and HTM | |
FIVE-QUARTER STATEMENT OF INCOME (Unaudited) - Table 3 | ||||||||||||||||||||
(Dollars in thousands, except per share amounts) | ||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||
June 30, | March 31, | December 31, | September 30, | June 30, | ||||||||||||||||
2024 | 2024 | 2023 | 2023 | 2023 | ||||||||||||||||
| Interest income | $ | 27,755 | $ | 28,463 | $ | 29,624 | $ | 29,450 | $ | 28,664 | ||||||||||
| Interest expense | 12,391 | 12,655 | 12,462 | 11,442 | 9,930 | |||||||||||||||
| Net interest income | 15,364 | 15,808 | 17,162 | 18,008 | 18,734 | |||||||||||||||
| Provision for credit losses | 200 | 400 | - | - | - | |||||||||||||||
| Net interest income after provision for credit losses | 15,164 | 15,408 | 17,162 | 18,008 | 18,734 | |||||||||||||||
| Gain on sale of loans | 1,064 | 1,489 | 838 | 419 | 1,952 | |||||||||||||||
| Gain (loss) on sale of OREO | - | (1 | ) | - | - | - | ||||||||||||||
| SBA servicing fee income, net | 768 | 643 | 690 | 639 | 440 | |||||||||||||||
| Service charges and other income | 503 | 430 | 436 | 402 | 407 | |||||||||||||||
| Noninterest income | 2,335 | 2,561 | 1,964 | 1,460 | 2,799 | |||||||||||||||
| Salaries and employee benefits | 5,927 | 6,024 | 5,356 | 5,569 | 5,581 | |||||||||||||||
| Occupancy and equipment | 1,114 | 1,122 | 1,128 | 1,103 | 1,122 | |||||||||||||||
| Marketing expense | 403 | 402 | 250 | 475 | 409 | |||||||||||||||
| Professional expense | 440 | 412 | 360 | 443 | 436 | |||||||||||||||
| Other expenses | 1,972 | 2,084 | 2,363 | 2,579 | 2,635 | |||||||||||||||
| Noninterest expense | 9,856 | 10,044 | 9,457 | 10,169 | 10,183 | |||||||||||||||
| Income before income tax expense | 7,643 | 7,925 | 9,669 | 9,299 | 11,350 | |||||||||||||||
| Income tax expense | 2,163 | 2,253 | 2,670 | 2,630 | 3,248 | |||||||||||||||
| Net income | $ | 5,480 | $ | 5,672 | $ | 6,999 | $ | 6,669 | $ | 8,102 | ||||||||||
| Effective tax rate | 28.3 | % | 28.4 | % | 27.6 | % | 28.3 | % | 28.6 | % | ||||||||||
| Outstanding number of shares | 10,588,136 | 10,588,136 | 10,588,136 | 10,588,136 | 10,588,136 | |||||||||||||||
| Weighted average shares for basic EPS | 10,588,136 | 10,588,136 | 10,588,136 | 10,588,136 | 10,588,136 | |||||||||||||||
| Weighted average shares for diluted EPS | 10,588,136 | 10,588,688 | 10,588,937 | 10,594,155 | 10,591,351 | |||||||||||||||
| Basic EPS | $ | 0.51 | $ | 0.54 | $ | 0.66 | $ | 0.63 | $ | 0.77 | ||||||||||
| Diluted EPS | $ | 0.51 | $ | 0.54 | $ | 0.66 | $ | 0.63 | $ | 0.76 | ||||||||||
FIVE-QUARTER SALARIES BENEFIT METRICS (Unaudited) - Table 4 | ||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
At or for the Three Months Ended | ||||||||||||||||||||
June 30, | March 31, | December 31, | September 30, | June 30, | ||||||||||||||||
2024 | 2023 | 2023 | 2023 | 2023 | ||||||||||||||||
| Salaries and benefits | $ | 5,927 | $ | 6,024 | $ | 5,356 | $ | 5,569 | $ | 5,581 | ||||||||||
| FTE at the end of period | 172 | 168 | 169 | 172 | 165 | |||||||||||||||
| Average FTE during the period | 171 | 169 | 169 | 168 | 164 | |||||||||||||||
| Salaries and benefits/average FTE¹ | $ | 139 | $ | 143 | $ | 126 | $ | 131 | $ | 137 | ||||||||||
| Salaries and benefits/average assets¹ | 1.42 | % | 1.41 | % | 1.18 | % | 1.22 | % | 1.23 | % | ||||||||||
| Noninterest expense/average assets¹ | 2.36 | % | 2.35 | % | 2.08 | % | 2.22 | % | 2.25 | % | ||||||||||
1 | Annualized | |
FIVE-QUARTER BALANCE SHEET (Unaudited) - Table 5 | ||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
June 30, | March 31, | December 31, | September 30, | June 30, | ||||||||||||||||
2024 | 2024 | 2023 | 2023 | 2023 | ||||||||||||||||
| ASSETS | ||||||||||||||||||||
| Cash and due from banks | $ | 11,667 | $ | 11,612 | $ | 14,282 | $ | 11,188 | $ | 12,704 | ||||||||||
| Interest-earning deposits at the FRB and other banks | 101,415 | 181,366 | 233,255 | 335,016 | 293,394 | |||||||||||||||
| Investment securities | 73,051 | 59,143 | 59,883 | 61,617 | 66,400 | |||||||||||||||
| Loans held-for-sale | 209,144 | 198,167 | 218,258 | 219,355 | 215,083 | |||||||||||||||
| Loans held-for-investment | 1,228,496 | 1,194,439 | 1,204,009 | 1,201,230 | 1,201,237 | |||||||||||||||
| Less: Allowance for credit losses | (16,042 | ) | (16,048 | ) | (15,291 | ) | (15,284 | ) | (15,626 | ) | ||||||||||
Loans held-for-investment, net | 1,212,454 | 1,178,391 | 1,188,718 | 1,185,946 | 1,185,611 | |||||||||||||||
Other real estate owned | - | - | 55 | 55 | - | |||||||||||||||
| Restricted stock investments | 11,011 | 11,011 | 11,011 | 11,011 | 11,011 | |||||||||||||||
| Servicing assets | 7,404 | 7,560 | 7,673 | 7,873 | 8,426 | |||||||||||||||
| Goodwill | 2,185 | 2,185 | 2,185 | 2,185 | 2,185 | |||||||||||||||
| Intangible assets | 235 | 245 | 255 | 267 | 279 | |||||||||||||||
| Other assets | 26,343 | 23,581 | 24,838 | 24,799 | 24,537 | |||||||||||||||
| Total assets | $ | 1,654,909 | $ | 1,673,261 | $ | 1,760,413 | $ | 1,859,312 | $ | 1,819,630 | ||||||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||||||||||||
| Noninterest-bearing | $ | 281,243 | $ | 286,766 | $ | 305,923 | $ | 406,033 | $ | 426,333 | ||||||||||
| Interest-bearing | 1,059,146 | 1,074,198 | 1,147,662 | 1,143,257 | 1,096,078 | |||||||||||||||
| Total deposits | 1,340,389 | 1,360,964 | 1,453,585 | 1,549,290 | 1,522,411 | |||||||||||||||
| FHLB advances | 50,000 | 50,000 | 50,000 | 50,000 | 50,000 | |||||||||||||||
| Other liabilities | 19,260 | 21,727 | 21,114 | 31,141 | 23,956 | |||||||||||||||
| Total liabilities | 1,409,649 | 1,432,691 | 1,524,699 | 1,630,431 | 1,596,367 | |||||||||||||||
| Stockholders' Equity | 245,260 | 240,570 | 235,714 | 228,881 | 223,263 | |||||||||||||||
| TOTAL LIABILITIES & STOCKHOLDERS' EQUITY | $ | 1,654,909 | $ | 1,673,261 | $ | 1,760,413 | $ | 1,859,312 | $ | 1,819,630 | ||||||||||
| FIVE-QUARTER LOANS RECEIVABLE COMPONENTS (Unaudited) - Table 6 | ||||||||||||||||||||||||||||||
| (Dollars in thousands) | ||||||||||||||||||||||||||||||
| June 30, 2024 | March 31, 2024 | December 31, 2023 | September 30, 2023 | June 30, 2023 | ||||||||||||||||||||||||||
| Balance | % | Balance | % | Balance | % | Balance | % | Balance | % | |||||||||||||||||||||
| Construction | $ | 33,918 | 2.8 | % | $ | 37,216 | 3.1 | % | $ | 34,886 | 2.9 | % | $ | 30,924 | 2.6 | % | $ | 20,106 | 1.7 | % | ||||||||||
| Commercial real estate | 1,035,425 | 84.3 | % | 1,005,765 | 84.2 | % | 1,010,495 | 83.9 | % | 1,005,735 | 83.7 | % | 1,014,785 | 84.5 | % | |||||||||||||||
| Commercial and industrial | 108,742 | 8.9 | % | 101,784 | 8.5 | % | 108,123 | 9.0 | % | 113,374 | 9.4 | % | 114,106 | 9.4 | % | |||||||||||||||
| Home mortgage | 44,987 | 3.7 | % | 44,389 | 3.7 | % | 44,920 | 3.7 | % | 45,452 | 3.8 | % | 45,987 | 3.8 | % | |||||||||||||||
| Consumer | 782 | 0.1 | % | 668 | 0.1 | % | 630 | 0.1 | % | 616 | 0.1 | % | 1,074 | 0.1 | % | |||||||||||||||
| Gross loans held-for-investment | 1,223,854 | 99.6 | % | 1,189,822 | 99.6 | % | 1,199,054 | 99.6 | % | 1,196,101 | 99.6 | % | 1,196,058 | 99.6 | % | |||||||||||||||
| Deferred loan fees/costs, net | 4,642 | 0.4 | % | 4,617 | 0.4 | % | 4,955 | 0.4 | % | 5,129 | 0.4 | % | 5,179 | 0.4 | % | |||||||||||||||
| Loans held-for-investment | $ | 1,228,496 | 100.0 | % | $ | 1,194,439 | 100.0 | % | $ | 1,204,009 | 100.0 | % | $ | 1,201,230 | 100.0 | % | $ | 1,201,237 | 100.0 | % | ||||||||||
| Loans held-for-sale | $ | 209,144 | $ | 198,167 | $ | 218,258 | $ | 219,355 | $ | 215,083 | ||||||||||||||||||||
| Total loans receivable | $ | 1,437,640 | $ | 1,392,606 | $ | 1,422,267 | $ | 1,420,585 | $ | 1,416,320 | ||||||||||||||||||||
FIVE-QUARTER SBA LOAN PRODUCTIONS/SALES DATA (Unaudited) - Table 7 | |||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||||||||||||||
June 30, | March 31, | December 31, | September 30, | June 30, | June 30, | June 30, | |||||||||||||||||||||||
2024 | 2024 | 2023 | 2023 | 2023 | 2024 | 2023 | |||||||||||||||||||||||
| SBA loans held-for-sale at beginning of the quarter/year | $ | 198,167 | $ | 218,258 | $ | 219,355 | $ | 215,083 | $ | 243,753 | $ | 218,258 | $ | 230,431 | |||||||||||||||
| SBA loans originated/transferred from/to held-for-investment during the quarter/year | 34,366 | 14,589 | 27,022 | 16,260 | 18,273 | 48,955 | 35,163 | ||||||||||||||||||||||
| SBA loans sold during the quarter/year | (19,508 | ) | (28,164 | ) | (21,749 | ) | (9,245 | ) | (42,437 | ) | (47,672 | ) | (42,437 | ) | |||||||||||||||
| SBA loans principal paydown/payoff, net of advance | (3,881 | ) | (6,516 | ) | (6,370 | ) | (2,743 | ) | (4,506 | ) | (10,397 | ) | (8,074 | ) | |||||||||||||||
| SBA loans held-for-sale at end of the quarter/year | $ | 209,144 | $ | 198,167 | $ | 218,258 | $ | 219,355 | $ | 215,083 | $ | 209,144 | $ | 215,083 | |||||||||||||||
| Gain on sale of SBA loans | $ | 1,064 | $ | 1,489 | $ | 838 | $ | 419 | $ | 1,952 | $ | 2,553 | $ | 1,952 | |||||||||||||||
| Premium on sale (weighted average) | 8.3 | % | 8.4 | % | 6.8 | % | 8.3 | % | 6.8 | % | 8.4 | % | 6.8 | % | |||||||||||||||
| SBA loan production | $ | 45,126 | $ | 18,089 | $ | 37,821 | $ | 24,270 | $ | 24,013 | $ | 63,215 | $ | 45,732 | |||||||||||||||
FIVE QUARTER SBA SERVICING ASSETS AND SERVICING FEES (Unaudited) - Table 8 | ||||||||||||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||||
June 30, | March 31, | December 31, | September 30, | June 30, | June 30, | June 30, | ||||||||||||||||||||||||
2024 | 2024 | 2023 | 2023 | 2023 | 2024 | 2023 | ||||||||||||||||||||||||
| SBA servicing assets @ beginning of the quarter/year | $ | 7,560 | $ | 7,673 | $ | 7,873 | $ | 8,426 | $ | 8,528 | $ | 7,673 | $ | 9,232 | ||||||||||||||||
| Newly added SBA servicing assets from SBA loans sold | 395 | 555 | 430 | 182 | 806 | 950 | 806 | |||||||||||||||||||||||
| Regular quarterly/annual servicing assets amortization | (335 | ) | (332 | ) | (356 | ) | (371 | ) | (379 | ) | (667 | ) | (782 | ) | ||||||||||||||||
| SBA servicing assets amortized from SBA loans paid off/charged off | (216 | ) | (336 | ) | (274 | ) | (364 | ) | (529 | ) | (552 | ) | (830 | ) | ||||||||||||||||
| Subtotal before impairment | 7,404 | 7,560 | 7,673 | 7,873 | 8,426 | 7,404 | 8,426 | |||||||||||||||||||||||
| Reversal of valuation allowance on servicing assets | - | - | - | - | - | - | - | |||||||||||||||||||||||
| SBA servicing assets @ the end of the quarter/year | $ | 7,404 | $ | 7,560 | $ | 7,673 | $ | 7,873 | $ | 8,426 | $ | 7,404 | $ | 8,426 | ||||||||||||||||
FIVE-QUARTER DEPOSIT COMPONENTS (Unaudited) - Table 9 | ||||||||||||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||||||||
June 30, 2024 | March 31, 2024 | December 31, 2023 | September 30, 2023 | June 30, 2023 | ||||||||||||||||||||||||||
Balance | % | Balance | % | Balance | % | Balance | % | Balance | % | |||||||||||||||||||||
| Noninterest-bearing demand | $ | 281,243 | 21.0 | % | $ | 286,766 | 21.1 | % | $ | 305,923 | 21.1 | % | $ | 406,033 | 26.2 | % | $ | 426,333 | 28.0 | % | ||||||||||
| Interest-bearing demand | 7,901 | 0.6 | % | 6,709 | 0.5 | % | 7,504 | 0.5 | % | 6,395 | 0.4 | % | 9,056 | 0.6 | % | |||||||||||||||
| NOW & MMDA | 240,951 | 18.0 | % | 229,642 | 16.9 | % | 237,548 | 16.3 | % | 227,283 | 14.7 | % | 210,429 | 13.8 | % | |||||||||||||||
| Savings | 80,360 | 6.0 | % | 84,999 | 6.2 | % | 88,689 | 6.1 | % | 78,969 | 5.1 | % | 62,324 | 4.1 | % | |||||||||||||||
| TCDs of $250K and under | 295,109 | 22.0 | % | 299,944 | 22.0 | % | 315,920 | 21.7 | % | 312,704 | 20.2 | % | 298,520 | 19.6 | % | |||||||||||||||
| TCDs of $250K over | 314,119 | 23.4 | % | 339,482 | 25.0 | % | 353,866 | 24.4 | % | 373,345 | 24.1 | % | 368,262 | 24.2 | % | |||||||||||||||
| Wholesale deposits | 120,706 | 9.0 | % | 113,422 | 8.3 | % | 144,135 | 9.9 | % | 144,561 | 9.3 | % | 147,487 | 9.7 | % | |||||||||||||||
| Total Deposits | $ | 1,340,389 | 100.0 | % | $ | 1,360,964 | 100.0 | % | $ | 1,453,585 | 100.0 | % | $ | 1,549,290 | 100.0 | % | $ | 1,522,411 | 100.0 | % | ||||||||||
| Recap: | ||||||||||||||||||||||||||||||
| Noninterest-bearing demand | $ | 281,243 | 21.0 | % | $ | 286,766 | 21.1 | % | $ | 305,923 | 21.0 | % | $ | 406,033 | 26.2 | % | $ | 426,333 | 28.0 | % | ||||||||||
| Interest-bearing demand | 7,901 | 0.6 | % | 6,709 | 0.5 | % | 7,504 | 0.5 | % | 6,395 | 0.4 | % | 9,056 | 0.6 | % | |||||||||||||||
| NOW & MMDA | 217,339 | 16.2 | % | 229,642 | 16.9 | % | 237,548 | 16.3 | % | 227,283 | 14.7 | % | 210,429 | 13.8 | % | |||||||||||||||
| Savings | 80,360 | 6.0 | % | 84,999 | 6.2 | % | 88,689 | 6.1 | % | 78,969 | 5.1 | % | 62,324 | 4.1 | % | |||||||||||||||
| TCDs of $250K and under | 295,109 | 22.0 | % | 299,944 | 22.0 | % | 315,920 | 21.7 | % | 312,704 | 20.2 | % | 298,520 | 19.6 | % | |||||||||||||||
| Core Deposits | 881,952 | 65.8 | % | 908,060 | 66.7 | % | 955,584 | 65.7 | % | 1,031,384 | 66.6 | % | 1,006,662 | 66.1 | % | |||||||||||||||
| TCDs of $250K over | 314,119 | 23.4 | % | 339,482 | 24.9 | % | 353,866 | 24.3 | % | 373,345 | 24.1 | % | 368,262 | 24.2 | % | |||||||||||||||
| ICS MMDA | 23,612 | 1.8 | % | |||||||||||||||||||||||||||
| Wholesale deposits | 120,706 | 9.0 | % | 113,422 | 8.3 | % | 144,135 | 9.9 | % | 144,561 | 9.3 | % | 147,487 | 9.7 | % | |||||||||||||||
| Noncore Deposits | 458,437 | 34.2 | % | 452,904 | 33.3 | % | 498,001 | 34.3 | % | 517,906 | 33.4 | % | 515,749 | 33.9 | % | |||||||||||||||
| Total Deposits | $ | 1,340,389 | 100.0 | % | $ | 1,360,964 | 100.0 | % | $ | 1,453,585 | 100.0 | % | $ | 1,549,290 | 100.0 | % | $ | 1,522,411 | 100.0 | % | ||||||||||
FIVE-QUARTER SELECTED LOAN AND ASSET QUALITY HIGHLIGHTS (Unaudited) - Table 10 | ||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
2nd Qtr. | 1st Qtr. | 4th Qtr. | 3rd Qtr. | 2nd Qtr. | ||||||||||||||||
2024 | 2024 | 2023 | 2023 | 2023 | ||||||||||||||||
| Allowance for Credit Losses | ||||||||||||||||||||
| Balance at beginning of period | $ | 16,048 | $ | 15,291 | $ | 15,284 | $ | 15,626 | $ | 15,627 | ||||||||||
| CECL transition provision | - | - | - | - | - | |||||||||||||||
| Provision for credit losses | 200 | 743 | - | - | - | |||||||||||||||
| Charge-offs | (257 | ) | (2 | ) | (350 | ) | (11 | ) | ||||||||||||
| Recoveries | 51 | 14 | 9 | 8 | 10 | |||||||||||||||
| Balance at the end of period | $ | 16,042 | $ | 16,048 | $ | 15,291 | $ | 15,284 | $ | 15,626 | ||||||||||
| Nonperforming Assets:¹ | ||||||||||||||||||||
| Over 90 days still accruing | $ | - | $ | 1,605 | $ | 399 | $ | 2 | $ | 39 | ||||||||||
| Nonaccrual loans | 5,797 | 2,842 | 2,030 | 616 | 645 | |||||||||||||||
| Total nonperforming loans | 5,797 | 4,447 | 2,429 | 618 | 684 | |||||||||||||||
| Other real estate owned | $ | - | - | 55 | 55 | - | ||||||||||||||
| Total nonperforming assets | $ | 5,797 | $ | 4,447 | $ | 2,484 | $ | 673 | $ | 684 | ||||||||||
| Classified Assets:¹ | ||||||||||||||||||||
| Substandard | $ | 12,762 | $ | 11,912 | $ | 11,063 | $ | 10,105 | $ | 10,491 | ||||||||||
| Doubtful | - | - | - | - | - | |||||||||||||||
| Loss | ||||||||||||||||||||
| Total classified loans | $ | 12,762 | $ | 11,912 | $ | 11,063 | $ | 10,105 | $ | 10,491 | ||||||||||
| Other real estate owned | $ | - |
| - | 55 | 55 | - | |||||||||||||
| Total classified assets | $ | 12,762 | $ | 11,912 | $ | 11,118 | $ | 10,160 | $ | 10,491 | ||||||||||
| Performing modified loans:¹ | $ | 464 | $ | 3,811 | $ | 3,336 | $ | 3,336 | $ | 3,336 | ||||||||||
| Delinquent Loans:¹ | ||||||||||||||||||||
| Loans 30-89 days past due | $ | 8,613 | $ | 16,907 | $ | 5,981 | $ | 10,620 | $ | 4,420 | ||||||||||
| 90 days or more past due and still accruing | - | 1,605 | 399 | 2 | 39 | |||||||||||||||
| Nonaccrual | 5,797 | 2,842 | 2,030 | 616 | 645 | |||||||||||||||
| Total delinquent loans | $ | 14,410 | $ | 21,354 | $ | 8,410 | $ | 11,238 | $ | 5,104 | ||||||||||
| Asset Quality Ratios: | ||||||||||||||||||||
| Net (recoveries) charge-offs to average loans² | 0.06 | % | 0.00 | % | 0.00 | % | 0.10 | % | 0.00 | % | ||||||||||
| Nonaccrual loans to loans held-for-investment | 0.47 | % | 0.24 | % | 0.17 | % | 0.05 | % | 0.05 | % | ||||||||||
| Nonperforming loans to loans held-for-investment | 0.47 | % | 0.37 | % | 0.20 | % | 0.05 | % | 0.06 | % | ||||||||||
| Nonperforming assets to total assets | 0.35 | % | 0.27 | % | 0.14 | % | 0.04 | % | 0.04 | % | ||||||||||
| Classified loans to loans held-for-investment | 1.04 | % | 1.00 | % | 0.92 | % | 0.84 | % | 0.87 | % | ||||||||||
| Classified loans to Tier 1 and ACL | 4.93 | % | 4.69 | % | 4.45 | % | 4.18 | % | 4.44 | % | ||||||||||
| Classified assets to total assets | 0.77 | % | 0.71 | % | 0.63 | % | 0.55 | % | 0.58 | % | ||||||||||
| Classified assets to Tier 1 and ACL | 4.93 | % | 4.69 | % | 4.47 | % | 4.20 | % | 4.44 | % | ||||||||||
| ACL to loans held-for-investment | 1.31 | % | 1.34 | % | 1.27 | % | 1.27 | % | 1.30 | % | ||||||||||
| ACL to nonaccrual loans | 276.73 | % | 564.67 | % | 753.25 | % | 2481.17 | % | 2422.64 | % | ||||||||||
| ACL to nonperforming loans | 276.73 | % | 360.87 | % | 629.52 | % | 2473.14 | % | 2284.50 | % | ||||||||||
| ACL to nonperforming assets | 276.73 | % | 360.87 | % | 615.58 | % | 2271.03 | % | 2284.50 | % | ||||||||||
| Texas ratio ³ | 2.24 | % | 1.75 | % | 1.00 | % | 0.28 | % | 0.29 | % | ||||||||||
¹ | Net of SBA guaranteed balance | ||
² | Includes loans held-for-sale | ||
³ | Nonperforming assets divided by tangible common equity and ACL | ||
| Allowance for Credit Losses on Off-Balance Sheet Items: | ||||||||||||||||||||
| Balance at beginning of period | $ | 324 | $ | 667 | $ | 667 | $ | 667 | $ | 667 | ||||||||||
| Provision for credit losses on off-balance sheet items | (343 | ) | - | - | - | |||||||||||||||
| Balance at the end of period | $ | 324 | $ | 324 | $ | 667 | $ | 667 | $ | 667 | ||||||||||
| Loans held-for-sale | 209,144 | 198,167 | 218,258 | 219,355 | 215,083 | |||||||||||||||
| Loans held-for-investment | 1,228,496 | 1,194,439 | 1,204,009 | 1,201,230 | 1,201,237 | |||||||||||||||
| Loans receivable | 1,437,640 | 1,392,606 | 1,422,267 | 1,420,585 | 1,416,320 | |||||||||||||||
| Total assets | 1,654,909 | 1,673,261 | 1,760,413 | 1,859,312 | 1,819,630 | |||||||||||||||
| Tier 1 and ACL | 258,882 | 254,188 | 248,565 | 241,713 | 236,425 | |||||||||||||||
| Tangible Common Equity | 242,840 | 238,140 | 233,274 | 226,429 | 220,799 | |||||||||||||||
| ACL | $ | 16,042 | $ | 16,048 | $ | 15,291 | $ | 15,284 | $ | 15,626 | ||||||||||
| Nonperforming assets to loans held-for-investment | 0.47 | % | 0.37 | % | 0.21 | % | 0.1 | % | 0.06 | % | ||||||||||
FIVE-QUARTER CAPITAL RATIOS (Unaudited) - Table 11 | ||||||||||||||||||||||||||
Well Capitalized | Adequately Capitalized | June 30, | March 31, | December 31, | September 30, | June 30, | ||||||||||||||||||||
Regulatory | BASEL III | |||||||||||||||||||||||||
Requirement | Fully Phased In | 2024 | 2024 | 2023 | 2023 | 2023 | ||||||||||||||||||||
| Leverage ratio | ||||||||||||||||||||||||||
| Company | N/A | N/A | 14.51 | % | 13.85 | % | 12.98 | % | 12.53 | % | 12.23 | % | ||||||||||||||
| Bank | 5.00 | % | 4.00 | % | 14.45 | % | 13.84 | % | 12.96 | % | 12.50 | % | 12.20 | % | ||||||||||||
| Common equity tier 1 risk-based capital ratio | ||||||||||||||||||||||||||
| Company | N/A | N/A | 18.36 | % | 18.67 | % | 18.08 | % | 17.61 | % | 17.08 | % | ||||||||||||||
| Bank | 6.50 | % | 7.00 | % | 18.28 | % | 18.65 | % | 18.05 | % | 17.57 | % | 17.03 | % | ||||||||||||
| Tier 1 risk-based capital ratio | ||||||||||||||||||||||||||
| Company | N/A | N/A | 18.36 | % | 18.67 | % | 18.08 | % | 17.61 | % | 17.08 | % | ||||||||||||||
| Bank | 8.00 | % | 8.50 | % | 18.28 | % | 18.65 | % | 18.05 | % | 17.57 | % | 17.03 | % | ||||||||||||
| Total risk-based capital ratio | ||||||||||||||||||||||||||
| Company | N/A | N/A | 19.59 | % | 19.92 | % | 19.30 | % | 18.83 | % | 18.32 | % | ||||||||||||||
| Bank | 10.00 | % | 10.50 | % | 19.50 | % | 19.91 | % | 19.27 | % | 18.79 | % | 18.27 | % | ||||||||||||
| Tangible common equity/total assets | 14.70 | % | 14.25 | % | 13.27 | % | 12.19 | % | 12.15 | % | ||||||||||||||||
| Tangible common equity per share | $ | 22.94 | $ | 22.49 | $ | 22.03 | $ | 21.39 | $ | 20.85 | ||||||||||||||||
FIVE-QUARTER MARGIN ANALYSIS (Unaudited) - Table 12 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
June 30, 2024 | March 31, 2024 | December 31, 2023 | September 30, 2023 | June 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Avg Balance | Interest | Yield | Avg Balance | Interest | Yield | Avg Balance | Interest | Yield | Avg Balance | Interest | Yield | Avg Balance | Interest | Yield | ||||||||||||||||||||||||||||||||||||||||
| Number of Days in the Period | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| INTEREST-EARNING ASSETS | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Loans Receivable¹ | $ | 1,418,458 | $ | 24,887 | 7.06 | % | $ | 1,415,924 | $ | 24,906 | 7.07 | % | $ | 1,410,971 | $ | 24,926 | 7.01 | % | $ | 1,417,148 | $ | 24,734 | 6.92 | % | $ | 1,444,608 | $ | 24,661 | 6.85 | % | ||||||||||||||||||||||||
| Investment securities ² | 70,052 | 723 | 4.15 | % | 59,554 | 575 | 3.88 | % | 60,094 | 563 | 3.72 | % | 64,587 | 577 | 3.54 | % | 67,958 | 595 | 3.51 | % | ||||||||||||||||||||||||||||||||||
| Interest-earning deposits at the FRB and other banks | 146,956 | 1,995 | 5.46 | % | 207,155 | 2,817 | 5.47 | % | 288,769 | 3,973 | 5.46 | % | 293,081 | 3,994 | 5.41 | % | 258,236 | 3,296 | 5.12 | % | ||||||||||||||||||||||||||||||||||
| Other earning assets | 11,011 | 200 | 7.31 | % | 11,011 | 214 | 7.82 | % | 11,011 | 212 | 7.64 | % | 11,011 | 196 | 7.06 | % | 10,825 | 163 | 6.04 | % | ||||||||||||||||||||||||||||||||||
| Total interest-earning assets ² | 1,646,477 | 27,805 | 6.79 | % | 1,693,644 | 28,512 | 6.77 | % | 1,770,845 | 29,674 | 6.65 | % | 1,785,827 | 29,501 | 6.55 | % | 1,781,627 | 28,715 | 6.46 | % | ||||||||||||||||||||||||||||||||||
| NONINTEREST-EARNING ASSETS | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Cash and due from banks | 12,907 | 12,172 | 12,567 | 13,045 | 12,792 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Other noninterest-earning assets | 33,263 | 31,967 | 32,985 | 33,331 | 34,060 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Total noninterest-earning assets | 46,170 | 44,139 | 45,552 | 46,376 | 46,852 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Less: Allowance for credit losses | (16,058 | ) | (15,322 | ) | (15,291 | ) | (15,622 | ) | (15,627 | ) | ||||||||||||||||||||||||||||||||||||||||||||
| TOTAL ASSETS | $ | 1,676,589 | $ | 1,722,461 | $ | 1,801,106 | $ | 1,816,581 | $ | 1,812,852 | ||||||||||||||||||||||||||||||||||||||||||||
| INTEREST-BEARING DEPOSITS | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Interest-bearing demand | $ | 11,864 | $ | 6 | 0.20 | % | $ | 12,680 | $ | 6 | 0.19 | % | $ | 12,657 | $ | 7 | 0.22 | % | $ | 12,347 | $ | 6 | 0.19 | % | $ | 14,522 | $ | 7 | 0.19 | % | ||||||||||||||||||||||||
| Money market | 230,261 | 2,272 | 3.97 | % | 229,441 | 2,285 | 4.01 | % | 222,289 | 2,158 | 3.85 | % | 211,152 | 1,907 | 3.58 | % | 192,872 | 1,414 | 2.94 | % | ||||||||||||||||||||||||||||||||||
| Savings | 82,215 | 700 | 3.42 | % | 84,854 | 724 | 3.43 | % | 82,403 | 664 | 3.20 | % | 70,579 | 494 | 2.78 | % | 63,786 | 324 | 2.04 | % | ||||||||||||||||||||||||||||||||||
| Time deposits | 759,954 | 9,296 | 4.92 | % | 801,122 | 9,523 | 4.78 | % | 824,900 | 9,515 | 4.58 | % | 820,335 | 8,916 | 4.31 | % | 839,198 | 8,068 | 3.86 | % | ||||||||||||||||||||||||||||||||||
| Total interest-bearing deposits | 1,084,294 | 12,274 | 4.55 | % | 1,128,097 | 12,538 | 4.47 | % | 1,142,249 | 12,344 | 4.29 | % | 1,114,413 | 11,323 | 4.03 | % | 1,110,378 | 9,813 | 3.54 | % | ||||||||||||||||||||||||||||||||||
| Borrowings | 50,013 | 117 | 0.94 | % | 50,000 | 117 | 0.94 | % | 50,001 | 118 | 0.94 | % | 50,001 | 119 | 0.94 | % | 50,000 | 117 | 0.94 | % | ||||||||||||||||||||||||||||||||||
| Total interest-bearing liabilities | 1,134,307 | 12,391 | 4.39 | % | 1,178,097 | 12,655 | 4.32 | % | 1,192,250 | 12,462 | 4.15 | % | 1,164,414 | 11,442 | 3.90 | % | 1,160,378 | 9,930 | 3.43 | % | ||||||||||||||||||||||||||||||||||
| Noninterest-bearing deposits | 279,765 | 284,867 | 350,656 | 397,791 | 411,432 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Other liabilities | 19,287 | 21,112 | 25,602 | 27,519 | 20,934 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Stockholders' equity | 243,230 | 238,385 | 232,598 | 226,857 | 220,108 | |||||||||||||||||||||||||||||||||||||||||||||||||
| TOTAL LIABILITIES & STOCKHOLDERS' EQUITY | $ | 1,676,589 | $ | 1,722,461 | $ | 1,801,106 | $ | 1,816,581 | $ | 1,812,852 | ||||||||||||||||||||||||||||||||||||||||||||
| Net interest income² | $ | 15,414 | $ | 15,857 | $ | 17,212 | $ | 18,059 | $ | 18,785 | ||||||||||||||||||||||||||||||||||||||||||||
| Net interest spread | 2.40 | % | 2.45 | % | 2.50 | % | 2.65 | % | 3.03 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Effect of noninterest-bearing sources | 1.37 | % | 1.32 | % | 1.36 | % | 1.36 | % | 1.20 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Net interest margin² | 3.77 | % | 3.77 | % | 3.86 | % | 4.01 | % | 4.23 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Cost of deposits | $ | 1,364,059 | $ | 12,274 | 3.62 | % | $ | 1,412,964 | $ | 12,538 | 3.57 | % | $ | 1,492,905 | $ | 12,344 | 3.28 | % | $ | 1,512,204 | $ | 11,323 | 2.97 | % | $ | 1,521,810 | $ | 9,813 | 2.59 | % | ||||||||||||||||||||||||
| Cost of funds | $ | 1,414,072 | $ | 12,391 | 3.52 | % | $ | 1,462,964 | $ | 12,655 | 3.48 | % | $ | 1,542,906 | $ | 12,462 | 3.20 | % | $ | 1,562,205 | $ | 11,442 | 2.91 | % | $ | 1,571,810 | $ | 9,930 | 2.53 | % | ||||||||||||||||||||||||
' | Loan held-for-investment, plus loans held-for-sale | |
² | Amounts calculated on a fully taxable equivalent basis using the current statutory federal tax rate | |
FIVE-QUARTER COMPONENTS OF YIELD ON LOANS (Unaudited) - Table 13 | |||||||||||||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||||||||
Three Months Ended | |||||||||||||||||||||||||||||||||||||||
June 30, 2024 | March 31, 2024 | December 31, 2023 | September 30, 2023 | June 30, 2023 | |||||||||||||||||||||||||||||||||||
Amount | Yield | Amount | Yield | Amount | Yield | Amount | Yield | Amount | Yield | ||||||||||||||||||||||||||||||
| Contractual yield | $ | 24,271 | 6.88 | % | $ | 24,138 | 6.86 | % | $ | 24,235 | 6.81 | % | $ | 23,932 | 6.70 | % | $ | 23,767 | 6.60 | % | |||||||||||||||||||
| SBA discount accretion | 736 | 0.21 | % | 926 | 0.26 | % | 845 | 0.24 | % | 921 | 0.25 | % | 1,124 | 0.31 | % | ||||||||||||||||||||||||
| Prepayment penalties and late fees | 36 | 0.01 | % | 67 | 0.01 | % | 40 | 0.01 | % | 18 | 0.01 | % | 60 | 0.02 | % | ||||||||||||||||||||||||
| Amortization of net deferred costs | (156 | ) | -0.04 | % | (225 | ) | -0.06 | % | (194 | ) | -0.05 | % | (137 | ) | -0.04 | % | (290 | ) | -0.08 | % | |||||||||||||||||||
| As reported yield on loans | $ | 24,887 | 7.06 | % | $ | 24,906 | 7.07 | % | $ | 24,926 | 7.01 | % | $ | 24,734 | 6.92 | % | $ | 24,661 | 6.85 | % | |||||||||||||||||||
MARGIN ANALYSIS (Unaudited) - Table 14 | |||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||
Six Months Ended | |||||||||||||||||||||
June 30, 2024 | June 30, 2023 | ||||||||||||||||||||
Avg Balance | Interest | Yield | Avg Balance | Interest | Yield | ||||||||||||||||
| Number of Days in the Period | |||||||||||||||||||||
| INTEREST-EARNING ASSETS | |||||||||||||||||||||
| Loans Receivable ¹ | $ | 1,417,191 | $ | 49,793 | 7.07 | % | $ | 1,473,184 | $ | 49,040 | 6.71 | % | |||||||||
| Investment securities ² | 64,803 | 1,298 | 4.03 | % | 69,046 | 1,172 | 3.42 | % | |||||||||||||
| Interest-earning deposits at the FRB and other banks | 177,056 | 4,812 | 5.47 | % | 224,651 | 5,474 | 4.91 | % | |||||||||||||
| Other earning assets | 11,011 | 414 | 7.56 | % | 10,475 | 327 | 6.30 | % | |||||||||||||
| Total interest-earning assets ² | 1,670,061 | 56,317 | 6.78 | % | 1,777,356 | 56,013 | 6.36 | % | |||||||||||||
| NONINTEREST-EARNING ASSETS | |||||||||||||||||||||
| Cash and due from banks | 12,540 | 13,523 | |||||||||||||||||||
| Other noninterest-earning assets | 32,122 | 35,296 | |||||||||||||||||||
| Total noninterest-earning assets | 44,662 | 48,819 | |||||||||||||||||||
| Less: Allowance for credit losses | (15,690 | ) | (15,590 | ) | |||||||||||||||||
| TOTAL ASSETS | $ | 1,699,033 | $ | 1,810,585 | |||||||||||||||||
| INTEREST-BEARING DEPOSITS | |||||||||||||||||||||
| Interest-bearing demand | $ | 12,271 | $ | 12 | 0.20 | % | $ | 16,261 | $ | 16 | 0.20 | % | |||||||||
| Money market | 229,851 | 4,557 | 3.99 | % | 212,261 | 2,883 | 2.74 | % | |||||||||||||
| Savings | 83,534 | 1,424 | 3.43 | % | 59,704 | 488 | 1.65 | % | |||||||||||||
| Time deposits | 780,539 | 18,819 | 4.85 | % | 818,251 | 14,478 | 3.57 | % | |||||||||||||
| Total interest-bearing deposits | 1,106,195 | 24,812 | 4.51 | % | 1,106,477 | 17,865 | 3.26 | % | |||||||||||||
| Borrowings | 50,007 | 234 | 0.9 | % | 50,000 | 233 | 0.94 | % | |||||||||||||
| Total interest-bearing liabilities | 1,156,202 | 25,046 | 4.36 | % | 1,156,477 | 18,098 | 3.16 | % | |||||||||||||
| Noninterest-bearing deposits | 282,316 | 418,273 | |||||||||||||||||||
| Other liabilities | 19,707 | 18,904 | |||||||||||||||||||
| Stockholders' equity | 240,808 | 216,931 | |||||||||||||||||||
| TOTAL LIABILITIES & STOCKHOLDERS' EQUITY | $ | 1,699,033 | $ | 1,810,585 | |||||||||||||||||
| Net interest income² | $ | 31,271 | $ | 37,915 | |||||||||||||||||
| Net interest spread | 2.42 | % | 3.20 | % | |||||||||||||||||
| Effect of noninterest-bearing sources | 1.35 | % | 1.10 | % | |||||||||||||||||
| Net interest margin² | 3.77 | % | 4.30 | % | |||||||||||||||||
| Cost of deposits | $ | 1,388,511 | $ | 24,812 | 3.59 | % | $ | 1,524,750 | $ | 17,865 | 2.36 | % | |||||||||
| Cost of funds | $ | 1,438,518 | $ | 25,046 | 3.50 | % | $ | 1,574,750 | $ | 18,098 | 2.32 | % | |||||||||
¹ | Loan held-for-investment, plus loans held-for-sale | |
² | Amounts calculated on a fully taxable equivalent basis using the current statutory federal tax rate | |
COMPONENTS OF YIELD ON LOANS (Unaudited) - Table 15 | ||||||||||||||
(Dollars in thousands) | ||||||||||||||
Six Months Ended | ||||||||||||||
June 30, 2024 | June 30, 2023 | |||||||||||||
Amount | Yield | Amount | Yield | |||||||||||
| Contractual yield | $ | 48,409 | 6.87 | % | $ | 47,410 | 6.49 | % | ||||||
| SBA discount accretion | 1,662 | 0.24 | % | 2,061 | 0.28 | % | ||||||||
| Prepayment penalties and late fees | 103 | 0.01 | % | 90 | 0.01 | % | ||||||||
| Amortization of net deferred costs | (381 | ) | -0.05 | % | (521 | ) | -0.07 | % | ||||||
| As reported yield on loans | $ | 49,793 | 7.07 | % | $ | 49,040 | 6.71 | % | ||||||
Contacts
Richard Koh, EVP & CFO
(323) 988-3037
RichardK@cbb-bank.com
