LOS ANGELES, Calif.--(BUSINESS WIRE)--American Business Bank (OTCQX: AMBZ) today reported net income of $10.8 million or $1.16 per fully diluted share for the quarter ended September 30, 2024 compared to $9.5 million or $1.02 per fully diluted share for the quarter ended June 30, 2024, and $10.2 million or $1.10 per fully diluted share for the quarter ending September 30, 2023, representing increases of 13% and 6%, respectively.
Net income for the nine months ended September 30, 2024 was $30.8 million or $3.31 per fully diluted share, a decrease of $1.8 million or 6%, from $32.6 million or $3.53 per fully diluted share for the nine months ended September 30, 2023.
"Results benefitted from the Bank's valuable low-cost deposit base, of which 47 percent is non-interest bearing checking accounts at the end of the quarter. Our customers continue to grow their businesses and provide deposits for the Bank to lend in the market. The deposit growth in the second and third quarters from existing customers was significant, however, some of the deposit inflows were event-driven and will not remain on the balance sheet over the long term. We continue to focus on building an outstanding core deposit franchise which resulted in eliminating borrowings in July. The deposit pipeline of new customer relationships remains strong and should drive further growth in the fourth quarter. This has enhanced the expansion of the net interest margin by 13 bps to 3.13% for the third quarter and to 3.21% for the month of September. The key to our success continues to be attracting new business clients through our outstanding team of relationship managers.
"We are proud to provide high touch community banking services to business clients with a conservative risk approach. Our commercial real estate lending is primarily owner-occupied which is not dependent on rent rolls, but reliant on the cash flows of the operating business that occupies the property. C&I and Owner-occupied commercial real estate portfolios comprise 60% of total loans and highlight our position as the premier relationship-banking franchise for small to mid-size businesses in Southern California.
"The Bank continued to expand our team of outstanding relationship managers over the last two quarters. We now have 48 calling officers up from 40 six months ago, this bodes quite well for the future.
"The intelligent delivery of superior service continues to produce excellent risk-adjusted returns for all stakeholders," commented Leon Blankstein, ABB's CEO and Director.
For the quarter ending September 30, 2024, net interest income was $31.4 million, an 8% increase compared to the prior quarter and a 4% increase compared to the prior year quarter. Higher average balances of interest earning deposits in other financial institutions led to an increase in interest income compared to the prior quarter and the prior year quarter. In addition, net interest income in the third quarter of 2024 benefitted from the elimination of borrowings that reduced interest expense compared to the prior quarter and the prior year quarter.
The allowance for credit losses as a percentage of loans was 1.11% at September 30, 2024 and June 30, 2024. No provision was recorded for the quarter as the reduction in the reserve for unfunded loan commitments was offset by an increase in the allowance for credit losses due to growth in the loan portfolio.
For the nine months ended September 30, 2024, net income was lower compared to the nine months ended September 30, 2023 due to a decrease in net interest income, an increase in salaries and employee benefits partially offset by a decrease in the provision for loan losses.
Net Interest Margin
Net interest margin for the third quarter of 2024 increased to 3.13% from 3.00% for the prior quarter and from 3.12% for the prior year quarter. This increase is primarily due to a decline in borrowings coupled with an increase in interest earning deposits in other financial institutions. As of September 30, 2024, 63% of the loan portfolio was fixed rate with a weighted average remaining life of 70 months. Approximately 43% of variable rate loans are indexed to prime of which $384 million are adjustable within 90 days of a change in prime. The net interest margin for the month of September 2024 was 3.21%.
Net Interest Income
For the quarter ended September 30, 2024, net interest income increased by $2.3 million, or 8%, compared to the quarter ended June 30, 2024; and increased by $1.1 million, or 4%, compared to the quarter ended September 30, 2023. This increase is due to growth in interest earning deposits at the FRB along with a decline in borrowing costs offset by an increase in the cost of deposits. For the quarter ending September 30, 2024, the cost of deposits was 1.44% representing an increase of 9 bps compared to the quarter ending June 30, 2024. The Loan-to-Deposit ratio was 71% and 72% as of September 30, 2024, and 2023, respectively.
Provision for Credit Losses
The following table presents details of the provision for credit losses for the periods indicated:
| Three Months Ended | Nine Months Ended | |||||||||||||||||
| September 30, 2024 | June 30, 2024 | September 30, 2023 | September 30, 2024 | September 30, 2023 | ||||||||||||||
| (Figures in $000s) | ||||||||||||||||||
| Addition (recapture) to allowance for loan losses | $ | 266 | $ | 450 | $ | 424 | $ | 490 | $ | 2,005 | ||||||||
| Addition (recapture) to reserve for unfunded loan commitments | (266 | ) | (438 | ) | 424 | (266 | ) | 834 | ||||||||||
| Total loan-related provision | $ | - | $ | 12 | $ | 848 | $ | 224 | $ | 2,839 | ||||||||
| Addition to allowance for held-to-maturity securities | - | - | - | - | - | |||||||||||||
| Total provision for credit losses | $ | - | $ | 12 | $ | 848 | $ | 224 | $ | 2,839 | ||||||||
Non-Interest Income
The increase in non-interest income compared to the prior quarter is primarily due to the gain on sale of SBA loans and an increase in the valuation of COLI policies offset by the loss on the sale of municipal investment securities. The decrease in non-interest income compared to the prior year quarter is primarily due to the loss on sale of municipal investment securities.
For the nine months ended September 30, 2024, non-interest income decreased $1.2 million or 17% compared to the same period a year ago, primarily due to a reduction in the gain on sale of SBA loans. In 2023, seasoned SBA loans were sold unlike in 2024 when only current production was sold.
Non-Interest Expense
For the quarter ending September 30, 2024, total non-interest expense increased $0.8 million compared to the prior quarter and increased $1.1 million compared to the prior year quarter. This was primarily due to increases in the number of full-time equivalent employees leading to rising salary and employee benefit expenses. The efficiency ratio decreased to 53% for the third quarter of 2024 compared to 55% for the second quarter of 2024 and the third quarter of 2023.
There were 248 full time equivalent employees at September 30, 2024 compared to 235 a year ago and 243 at June 30, 2024. The Bank has 48 relationship managers in eight offices compared to 42 at June 30, 2024 and September 30, 2023.
For the nine months ended September 30, 2024, non-interest expense increased $2.5 million or 5% compared to the same period a year ago, mainly due to increases in salaries and employee benefits.
Income Taxes
The effective income tax rate was 28.1% for the quarter ended September 30, 2024, 28.0% for the quarter ended June 30, 2024, and 28.2% for the quarter ended September 30, 2023.
Balance Sheet
For the quarter ended September 30, 2024, total loans increased $22 million, or 0.9% compared to the prior quarter. The majority of this increase was in Owner-occupied commercial real estate loans mainly due to an increase in industrial and restaurant collateral type loans. The increase in construction loans is primarily related to off campus university student housing in greater Los Angeles. The increase in commercial real estate (CRE) loans was offset by a decline in Commercial and Industrial (C&I) loans mainly due to a decrease in line utilization. At September 30, 2024, the utilization rate for the Bank's commercial lines of credit decreased to 26% from 27% at June 30, 2024. The following table is the composition of CRE loans as of:
| September 30, 2024 | June 30, 2024 | ||||||
| (Figures in $000s) | |||||||
| RE - Owner-occupied | $ | 1,130,647 | $ | 1,095,538 | |||
| RE - Non-owner occupied | 736,124 | 737,525 | |||||
| Construction & Land | 88,669 | 76,760 | |||||
| Total CRE Loans | $ | 1,955,440 | $ | 1,909,822 | |||
The following table is the composition of the Owner-occupied and Non owner-occupied CRE loans by collateral type:
| as of September 30, 2024 | |||||||
| Owner-occupied | Non owner-occupied | ||||||
| (Figures in $000s) | |||||||
| Industrial | $ | 680,023 | $ | 313,918 | |||
| Office | 167,510 | 99,922 | |||||
| Retail | 22,708 | 182,038 | |||||
| Automobile Service Facilities | 64,422 | 22,632 | |||||
| Contractor's Yard | 61,651 | 4,097 | |||||
| Other | 28,640 | 38,060 | |||||
| Miscellaneous | 105,693 | 75,456 | |||||
| Total | $ | 1,130,647 | $ | 736,124 | |||
Total investment securities at September 30, 2024 were $1.1 billion including $557 million (46%) in held-to-maturity (HTM) securities based on book value. The Bank has no non-agency mortgage-backed securities in its portfolio. As of September 30, 2024, the duration of the available-for-sale (AFS) securities portfolio was 5.7 years, compared to 5.8 years as of June 30, 2024 and September 30, 2023. Accumulated other comprehensive loss (AOCI) decreased to $59.7 million as of September 30, 2024 from $74.9 million as of June 30, 2024 as market rates relevant to securities pricing declined. The duration of the held-to-maturity portfolio, which consists primarily of municipal securities, is 7.5 years. As of September 30, 2024, the unrealized after tax loss on HTM securities was $60 million.
Deposits grew by $258 million or 7% to $3.7 billion in the quarter ended September 30, 2024. For the nine months of 2024, new deposit relationships have totaled approximately $73 million from 122 new clients. The Bank's off-balance sheet products of treasury securities held for clients increased by $32 million during the third quarter of 2024 to $254 million. The Bank has no brokered or internet-solicited deposits. Non-interest bearing deposits increased from 46% of total deposits to 47% of total deposits in the third quarter. The cost of deposits for the month of September was 1.42%.
During the third quarter of 2024, total assets increased $191 million, or 4.9%, total loans increased by $22 million, or 0.9%, total deposits increased by $258 million, or 7.5%, and borrowings decreased by $100 million. There are no borrowings at the end of the third quarter of 2024.
The Federal Reserve Bank (FRB) Term Funding Program ended March 11, 2024 and was paid in full on July 31, 2024. As of September 30, 2024, the Bank has $1.6 billion in borrowing capacity including the FRB discount window and from loans pledged at the Federal Home Loan Bank of San Francisco.
Asset Quality
The following table presents asset quality overview as of the dates indicated:
| September 30, 2024 | June 30, 2024 | ||||||
| (Figures in $000s) | |||||||
| Non-performing assets (NPA) | $ | 6,969 | $ | 6,641 | |||
| Loans 90+ days past due and still accruing | - | - | |||||
| Total NPA | $ | 6,969 | $ | 6,641 | |||
| NPA as a % of total assets | 0.17 | % | 0.24 | % | |||
| Past Due as a % of total loans | 0.00 | % | 0.13 | % | |||
| Criticized as a % of total loans | 4.48 | % | 5.06 | % | |||
| Classified as a % of total loans | 0.90 | % | 1.03 | % | |||
During the third quarter of 2024, non-performing assets (NPAs) increased by $0.3 million due to an additional C&I loan. As of September 30, 2024, NPAs have a $153 thousand allowance on individually evaluated loans related to five non-performing C&I loans of which the majority have a partial guarantee by the state of California or the SBA. The decline in classified loans is mainly due to the payoff of a residential real estate loan during the quarter.
The loan portfolio has approximately 10% in office collateral of which the majority is owner-occupied, and substantially all are three stories or under and located in suburban markets.
The following table represents the allowance for credit losses for loans as of and for the dates and periods indicated:
| Three Months Ended | Nine Months Ended | ||||||||||||||||||
| September 30, 2024 | June 30, 2024 | September 30, 2023 | September 30, 2024 | September 30, 2023 | |||||||||||||||
| (Figures in $000s) | |||||||||||||||||||
| Balance, beginning of period | $ | 28,843 | $ | 28,335 | $ | 27,172 | $ | 28,460 | $ | 29,635 | |||||||||
| Cumulative effect of change in accounting principle - CECL | - | - | - | - | (3,885 | ) | |||||||||||||
| Charge-offs | (4 | ) | - | (15 | ) | (103 | ) | (194 | ) | ||||||||||
| Recoveries | - | 58 | 20 | 258 | 40 | ||||||||||||||
| Net (charge-offs) / recoveries | $ | (4 | ) | $ | 58 | $ | 5 | $ | 155 | $ | (154 | ) | |||||||
| Provision | 266 | 450 | 424 | 490 | 2,005 | ||||||||||||||
| Balance, end of period | $ | 29,105 | $ | 28,843 | $ | 27,601 | $ | 29,105 | $ | 27,601 | |||||||||
| Allowance as a % of loans | 1.11 | % | 1.11 | % | 1.10 | % | 1.11 | % | 1.10 | % | |||||||||
The allowance for credit losses for loans increased to $29.1 million during the third quarter of 2024 primarily as a result of an increase in the loan portfolio. There was a $4 thousand charge off in the third quarter of 2024 compared to charge offs of $15 thousand during the prior year quarter. The Bank recovered $258 thousand in the first half of 2024; the majority of which had been charged off in the fourth quarter of 2023. The Bank has four restructured loans totaling $4.1 million involving borrowers experiencing financial difficulty.
ABOUT AMERICAN BUSINESS BANK
American Business Bank, headquartered in downtown Los Angeles, offers a wide range of financial services to the business marketplace. Clients include wholesalers, manufacturers, service businesses, professionals and non-profits. American Business Bank has seven Loan Production Offices in strategic locations including: North Orange County in Anaheim, Orange County in Irvine, South Bay in Torrance, San Fernando Valley in Woodland Hills, Riverside County in Corona, Inland Empire in Ontario and LA Coastal in Long Beach.
FORWARD LOOKING STATEMENTS
This communication contains certain forward-looking information about American Business Bank that is intended to be covered by the safe harbor for "forward-looking statements" provided by the Private Securities Litigation Reform Act of 1995. Such statements include future financial and operating results, expectations, intentions and other statements that are not historical facts. Such statements are based on information available at the time of this communication and are based on current beliefs and expectations of the Bank's management and are subject to significant risks, uncertainties and contingencies, many of which are beyond our control. Actual results may differ materially from those set forth in the forward-looking statements due to a variety of factors, including various risk factors. We are under no obligation (and expressly disclaim any such obligation) to update or alter our forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
| American Business Bank | ||||||||||||||||||||
| Figures in $000, except share and per share amounts | ||||||||||||||||||||
| BALANCE SHEETS (unaudited) | ||||||||||||||||||||
September | June | December | September | |||||||||||||||||
2024 | 2024 | 2023 | 2023 | |||||||||||||||||
| Assets: | ||||||||||||||||||||
| Cash and Due from Banks | $ | 109,214 | $ | 84,836 | $ | 32,354 | $ | 71,351 | ||||||||||||
| Interest Earning Deposits in Other Financial Institutions | 168,521 | 15,511 | 10,804 | 12,111 | ||||||||||||||||
| Investment Securities: | ||||||||||||||||||||
| US Agencies | 73,265 | 79,700 | 91,226 | 97,828 | ||||||||||||||||
| Mortgage Backed Securities | 400,381 | 390,886 | 413,870 | 398,645 | ||||||||||||||||
| State and Municipals | 78,504 | 81,884 | 91,949 | 91,064 | ||||||||||||||||
| Corporate Bonds | 14,371 | 14,478 | 14,157 | 13,866 | ||||||||||||||||
| Securities Available-for-Sale, at Fair Value | 566,521 | 566,948 | 611,202 | 601,403 | ||||||||||||||||
| Mortgage Backed Securities | 169,623 | 172,984 | 178,985 | 181,623 | ||||||||||||||||
| State and Municipals | 383,483 | 384,048 | 390,184 | 390,764 | ||||||||||||||||
| Allowance for Credit Losses, Held-To-Maturity | (55 | ) | (55 | ) | (55 | ) | (55 | ) | ||||||||||||
| Securities Held-to-Maturity, at Amortized Cost, | 553,051 | 556,977 | 569,114 | 572,332 | ||||||||||||||||
| Net of Allowance for Credit Losses | ||||||||||||||||||||
| Federal Home Loan Bank Stock, at Cost | 15,000 | 15,000 | 15,000 | 15,000 | ||||||||||||||||
| Total Investment Securities | 1,134,572 | 1,138,925 | 1,195,316 | 1,188,735 | ||||||||||||||||
| Loans Receivable: | ||||||||||||||||||||
| Commercial Real Estate | 1,955,440 | 1,909,822 | 1,884,085 | 1,853,527 | ||||||||||||||||
| Commercial and Industrial | 461,980 | 487,557 | 491,698 | 477,960 | ||||||||||||||||
| Residential Real Estate | 198,259 | 196,194 | 197,281 | 172,411 | ||||||||||||||||
| Installment and Other | 7,411 | 7,471 | 6,577 | 7,107 | ||||||||||||||||
| Total Loans Receivable | 2,623,090 | 2,601,044 | 2,579,641 | 2,511,005 | ||||||||||||||||
| Allowance for Credit Losses | (29,105 | ) | (28,843 | ) | (28,460 | ) | (27,601 | ) | ||||||||||||
| Loans Receivable, Net | 2,593,985 | 2,572,201 | 2,551,181 | 2,483,404 | ||||||||||||||||
| Furniture, Equipment and Leasehold Improvements, Net | 4,831 | 4,684 | 4,589 | 4,845 | ||||||||||||||||
| Bank/Corporate Owned Life Insurance | 29,714 | 29,396 | 28,898 | 28,400 | ||||||||||||||||
| Other Assets | 79,151 | 83,096 | 79,582 | 85,315 | ||||||||||||||||
| Total Assets | $ | 4,119,988 | $ | 3,928,649 | $ | 3,902,724 | $ | 3,874,161 | ||||||||||||
| Liabilities: | ||||||||||||||||||||
| Non-Interest Bearing Demand Deposits | $ | 1,745,491 | $ | 1,597,426 | $ | 1,699,560 | $ | 1,796,743 | ||||||||||||
| Interest Bearing Transaction Accounts | 376,033 | 394,051 | 388,152 | 331,315 | ||||||||||||||||
| Money Market and Savings Deposits | 1,297,950 | 1,202,143 | 1,145,389 | 1,124,590 | ||||||||||||||||
| Certificates of Deposit | 295,865 | 263,587 | 264,312 | 250,032 | ||||||||||||||||
| Total Deposits | 3,715,339 | 3,457,207 | 3,497,413 | 3,502,680 | ||||||||||||||||
| Federal Home Loan Bank Advances / Other Borrowings | - | 100,000 | 55,000 | 40,000 | ||||||||||||||||
| Other Liabilities | 47,107 | 40,570 | 36,257 | 52,204 | ||||||||||||||||
| Total Liabilities | $ | 3,762,446 | $ | 3,597,777 | $ | 3,588,670 | $ | 3,594,884 | ||||||||||||
| Shareholders' Equity: | ||||||||||||||||||||
| Common Stock | $ | 209,679 | $ | 209,042 | $ | 208,048 | $ | 207,451 | ||||||||||||
| Retained Earnings | 207,523 | 196,743 | 176,747 | 165,372 | ||||||||||||||||
| Accumulated Other Comprehensive Income / (Loss) | (59,660 | ) | (74,913 | ) | (70,741 | ) | (93,546 | ) | ||||||||||||
| Total Shareholders' Equity | $ | 357,542 | $ | 330,872 | $ | 314,054 | $ | 279,277 | ||||||||||||
| Total Liabilities and Shareholders' Equity | $ | 4,119,988 | $ | 3,928,649 | $ | 3,902,724 | $ | 3,874,161 | ||||||||||||
| Standby Letters of Credit | $ | 46,460 | $ | 43,420 | $ | 43,178 | $ | 41,823 | ||||||||||||
| Per Share Information: | ||||||||||||||||||||
| Common Shares Outstanding | 9,101,654 | 9,100,023 | 9,041,911 | 9,039,092 | ||||||||||||||||
| Book Value Per Share | $ | 39.28 | $ | 36.36 | $ | 34.73 | $ | 30.90 | ||||||||||||
| Tangible Book Value Per Share | $ | 39.28 | $ | 36.36 | $ | 34.73 | $ | 30.90 | ||||||||||||
| American Business Bank | |||||||||||||
| Figures in $000, except share and per share amounts | |||||||||||||
| INCOME STATEMENTS (unaudited) | |||||||||||||
| For the three months ended: | |||||||||||||
September | June | September | |||||||||||
2024 | 2024 | 2023 | |||||||||||
| Interest Income: | |||||||||||||
| Interest and Fees on Loans | $ | 35,513 | $ | 34,358 | $ | 32,332 | |||||||
| Interest on Investment Securities | 7,176 | 7,431 | 7,787 | ||||||||||
| Interest on Interest Earning Deposits | |||||||||||||
| in Other Financial Institutions | 2,129 | 839 | 279 | ||||||||||
| Total Interest Income | 44,818 | 42,628 | 40,398 | ||||||||||
| Interest Expense: | |||||||||||||
| Interest on Interest Bearing Transaction Accounts | 1,220 | 1,077 | 704 | ||||||||||
| Interest on Money Market and Savings Deposits | 9,083 | 7,900 | 6,019 | ||||||||||
| Interest on Certificates of Deposits | 2,785 | 2,408 | 1,964 | ||||||||||
| Interest on Federal Home Loan Bank Advances | |||||||||||||
| and Other Borrowings | 363 | 2,203 | 1,433 | ||||||||||
| Total Interest Expense | 13,451 | 13,588 | 10,120 | ||||||||||
| Net Interest Income | 31,367 | 29,040 | 30,278 | ||||||||||
| Provision for Credit Losses | - | 12 | 848 | ||||||||||
| Net Interest Income after Provision for Credit Losses | 31,367 | 29,028 | 29,430 | ||||||||||
| Non-Interest Income: | |||||||||||||
| Deposit Fees | 1,108 | 1,077 | 937 | ||||||||||
| International Fees | 433 | 418 | 439 | ||||||||||
| Gain (Loss) on Sale of Investment Securities, Net | (587 | ) | (397 | ) | (63 | ) | |||||||
| Gain on Sale of SBA Loans, Net | 187 | 12 | 143 | ||||||||||
| Bank/Corporate Owned Life Insurance Income (Expense) | 318 | 212 | 98 | ||||||||||
| Other | 454 | 367 | 398 | ||||||||||
| Total Non-Interest Income | 1,913 | 1,689 | 1,952 | ||||||||||
| Non-Interest Expense: | |||||||||||||
| Salaries and Employee Benefits | 12,622 | 12,052 | 11,487 | ||||||||||
| Occupancy and Equipment | 1,206 | 1,195 | 1,200 | ||||||||||
| Professional Services | 2,172 | 2,079 | 2,136 | ||||||||||
| Promotion Expenses | 720 | 680 | 794 | ||||||||||
| Other | 1,565 | 1,509 | 1,587 | ||||||||||
| Total Non-Interest Expense | 18,285 | 17,515 | 17,204 | ||||||||||
| Earnings before income taxes | 14,995 | 13,202 | 14,178 | ||||||||||
| Income Tax Expense | 4,215 | 3,703 | 3,996 | ||||||||||
| NET INCOME | $ | 10,780 | $ | 9,499 | $ | 10,182 | |||||||
| Per Share Information: | |||||||||||||
| Earnings Per Share - Basic | $ | 1.16 | $ | 1.03 | $ | 1.11 | |||||||
| Earnings Per Share - Diluted | $ | 1.16 | $ | 1.02 | $ | 1.10 | |||||||
| Weighted Average Shares - Basic | 9,279,741 | 9,259,753 | 9,211,933 | ||||||||||
| Weighted Average Shares - Diluted | 9,318,868 | 9,298,130 | 9,240,346 | ||||||||||
| American Business Bank | |||||||||
| Figures in $000, except share and per share amounts | |||||||||
| INCOME STATEMENTS (unaudited) | |||||||||
For the nine months ended: | |||||||||
September | September | ||||||||
2024 | 2023 | ||||||||
| Interest Income: | |||||||||
| Interest and Fees on Loans | $ | 103,535 | $ | 93,355 | |||||
| Interest on Investment Securities | 22,265 | 23,436 | |||||||
| Interest on Interest Earning Deposits | |||||||||
| in Other Financial Institutions | 3,218 | 739 | |||||||
| Total Interest Income | 129,018 | 117,530 | |||||||
| Interest Expense: | |||||||||
| Interest on Interest Bearing Transaction Accounts | 3,299 | 1,342 | |||||||
| Interest on Money Market and Savings Deposits | 24,247 | 12,572 | |||||||
| Interest on Certificates of Deposits | 7,481 | 3,255 | |||||||
| Interest on Federal Home Loan Bank Advances | |||||||||
| and Other Borrowings | 4,164 | 9,394 | |||||||
| Total Interest Expense | 39,191 | 26,563 | |||||||
| Net Interest Income | 89,827 | 90,967 | |||||||
| Provision for Credit Losses | 224 | 2,839 | |||||||
| Net Interest Income after Provision for Credit Losses | 89,603 | 88,128 | |||||||
| Non-Interest Income: | |||||||||
| Deposit Fees | 3,172 | 2,954 | |||||||
| International Fees | 1,257 | 1,150 | |||||||
| Gain (Loss) on Sale of Investment Securities, Net | (1,094 | ) | (652 | ) | |||||
| Gain on Sale of SBA Loans, Net | 256 | 989 | |||||||
| Bank/Corporate Owned Life Insurance Income (Expense) | 816 | 732 | |||||||
| Other | 1,309 | 1,738 | |||||||
| Total Non-Interest Income | 5,716 | 6,911 | |||||||
| Non-Interest Expense: | |||||||||
| Salaries and Employee Benefits | 36,323 | 34,449 | |||||||
| Occupancy and Equipment | 3,610 | 3,592 | |||||||
| Professional Services | 6,214 | 5,867 | |||||||
| Promotion Expenses | 1,927 | 1,841 | |||||||
| Other | 4,499 | 4,276 | |||||||
| Total Non-Interest Expense | 52,573 | 50,025 | |||||||
| Earnings before income taxes | 42,746 | 45,014 | |||||||
| Income Tax Expense | 11,970 | 12,422 | |||||||
| NET INCOME | $ | 30,776 | $ | 32,592 | |||||
| Per Share Information: | |||||||||
| Earnings Per Share - Basic | $ | 3.32 | $ | 3.55 | |||||
| Earnings Per Share - Diluted | $ | 3.31 | $ | 3.53 | |||||
| Weighted Average Shares - Basic | 9,258,937 | 9,181,813 | |||||||
| Weighted Average Shares - Diluted | 9,303,605 | 9,229,089 | |||||||
| American Business Bank | |||||||||||||||
| Figures in $000 | |||||||||||||||
| QUARTERLY AVERAGE BALANCE SHEETS AND YIELD ANALYSIS (unaudited) | |||||||||||||||
| For the three months ended: | |||||||||||||||
| September 2024 | June 2024 | ||||||||||||||
| Average | Interest | Average | Average | Interest | Average | ||||||||||
| Balance | Inc/Exp | Yield/Rate | Balance | Inc/Exp | Yield/Rate | ||||||||||
| Interest Earning Assets: | |||||||||||||||
| Interest Earning Deposits in Other Financial Institutions | $ | 156,041 | $ | 2,129 | 5.43 | % | $ | 61,618 | $ | 839 | 5.48 | % | |||
| Investment Securities: | |||||||||||||||
| US Agencies | 76,670 | 1,045 | 5.45 | % | 83,020 | 1,170 | 5.64 | % | |||||||
| Mortgage Backed Securities | 650,264 | 3,032 | 1.87 | % | 662,880 | 3,129 | 1.89 | % | |||||||
| State and Municipals | 470,564 | 2,582 | 2.19 | % | 477,603 | 2,617 | 2.19 | % | |||||||
| Corporate Bonds | 16,250 | 188 | 4.63 | % | 16,250 | 188 | 4.64 | % | |||||||
| Securities Available-for-Sale and Held-to-Maturity | 1,213,748 | 6,847 | 2.26 | % | 1,239,753 | 7,104 | 2.29 | % | |||||||
| Federal Home Loan Bank Stock | 15,000 | 329 | 8.76 | % | 15,000 | 327 | 8.72 | % | |||||||
| Total Investment Securities | 1,228,748 | 7,176 | 2.34 | % | 1,254,753 | 7,431 | 2.37 | % | |||||||
| Loans Receivable: | |||||||||||||||
| Commercial Real Estate | 1,929,129 | 24,257 | 5.00 | % | 1,888,292 | 23,086 | 4.92 | % | |||||||
| Commercial and Industrial | 462,791 | 8,028 | 6.90 | % | 478,868 | 8,088 | 6.79 | % | |||||||
| Residential Real Estate | 196,130 | 3,164 | 6.42 | % | 196,740 | 3,115 | 6.37 | % | |||||||
| Installment and Other | 8,349 | 64 | 3.03 | % | 8,628 | 69 | 3.23 | % | |||||||
| Total Loans Receivable | 2,596,399 | 35,513 | 5.44 | % | 2,572,528 | 34,358 | 5.37 | % | |||||||
| Total Interest Earning Assets | $ | 3,981,188 | $ | 44,818 | 4.41 | % | $ | 3,888,899 | $ | 42,628 | 4.34 | % | |||
| Liabilities: | |||||||||||||||
| Non-Interest Bearing Demand Deposits | 1,671,657 | - | 0.00 | % | 1,607,544 | - | 0.00 | % | |||||||
| Interest Bearing Transaction Accounts | 394,184 | 1,220 | 1.23 | % | 384,339 | 1,077 | 1.13 | % | |||||||
| Money Market and Savings Deposits | 1,265,785 | 9,083 | 2.85 | % | 1,145,701 | 7,900 | 2.77 | % | |||||||
| Certificates of Deposit | 288,357 | 2,785 | 3.84 | % | 261,401 | 2,408 | 3.70 | % | |||||||
| Total Deposits | 3,619,983 | 13,088 | 1.44 | % | 3,398,985 | 11,385 | 1.35 | % | |||||||
| Federal Home Loan Bank Advances / Other Borrowings | 25,598 | 363 | 5.64 | % | 162,533 | 2,203 | 5.45 | % | |||||||
| Total Interest Bearing Deposits and Borrowings | 1,973,924 | 13,451 | 2.71 | % | 1,953,974 | 13,588 | 2.80 | % | |||||||
| Total Deposits and Borrowings | $ | 3,645,581 | $ | 13,451 | 1.47 | % | $ | 3,561,518 | $ | 13,588 | 1.53 | % | |||
| Net Interest Income | $ | 31,367 | $ | 29,040 | |||||||||||
| Net Interest Rate Spread | 2.94 | % | 2.81 | % | |||||||||||
| Net Interest Margin | 3.13 | % | 3.00 | % | |||||||||||
| American Business Bank | |||||||||||||||
| Figures in $000 | |||||||||||||||
| QUARTERLY AVERAGE BALANCE SHEETS AND YIELD ANALYSIS (unaudited) | |||||||||||||||
| For the three months ended: | |||||||||||||||
| September 2024 | September 2023 | ||||||||||||||
| Average | Interest | Average | Average | Interest | Average | ||||||||||
| Balance | Inc/Exp | Yield/Rate | Balance | Inc/Exp | Yield/Rate | ||||||||||
| Interest Earning Assets: | |||||||||||||||
| Interest Earning Deposits in Other Financial Institutions | $ | 156,041 | $ | 2,129 | 5.43 | % | $ | 21,319 | $ | 279 | 5.19 | % | |||
| Investment Securities: | |||||||||||||||
| US Agencies | 76,670 | 1,045 | 5.45 | % | 101,829 | 1,325 | 5.21 | % | |||||||
| Mortgage Backed Securities | 650,264 | 3,032 | 1.87 | % | 696,633 | 3,236 | 1.86 | % | |||||||
| State and Municipals | 470,564 | 2,582 | 2.19 | % | 498,134 | 2,745 | 2.20 | % | |||||||
| Corporate Bonds | 16,250 | 188 | 4.63 | % | 16,250 | 188 | 4.63 | % | |||||||
| Securities Available-for-Sale and Held-to-Maturity | 1,213,748 | 6,847 | 2.26 | % | 1,312,846 | 7,494 | 2.28 | % | |||||||
| Federal Home Loan Bank Stock | 15,000 | 329 | 8.76 | % | 15,000 | 293 | 7.82 | % | |||||||
| Total Investment Securities | 1,228,748 | 7,176 | 2.34 | % | 1,327,846 | 7,787 | 2.35 | % | |||||||
| Loans Receivable: | |||||||||||||||
| Commercial Real Estate | 1,929,129 | 24,257 | 5.00 | % | 1,842,818 | 21,974 | 4.73 | % | |||||||
| Commercial and Industrial | 462,791 | 8,028 | 6.90 | % | 480,743 | 7,734 | 6.38 | % | |||||||
| Residential Real Estate | 196,130 | 3,164 | 6.42 | % | 170,576 | 2,558 | 5.95 | % | |||||||
| Installment and Other | 8,349 | 64 | 3.03 | % | 8,537 | 66 | 3.07 | % | |||||||
| Total Loans Receivable | 2,596,399 | 35,513 | 5.44 | % | 2,502,674 | 32,332 | 5.13 | % | |||||||
| Total Interest Earning Assets | $ | 3,981,188 | $ | 44,818 | 4.41 | % | $ | 3,851,839 | $ | 40,398 | 4.10 | % | |||
| Liabilities: | |||||||||||||||
| Non-Interest Bearing Demand Deposits | 1,671,657 | - | 0.00 | % | 1,824,291 | - | 0.00 | % | |||||||
| Interest Bearing Transaction Accounts | 394,184 | 1,220 | 1.23 | % | 324,710 | 704 | 0.86 | % | |||||||
| Money Market and Savings Deposits | 1,265,785 | 9,083 | 2.85 | % | 1,062,607 | 6,019 | 2.25 | % | |||||||
| Certificates of Deposit | 288,357 | 2,785 | 3.84 | % | 228,872 | 1,964 | 3.40 | % | |||||||
| Total Deposits | 3,619,983 | 13,088 | 1.44 | % | 3,440,480 | 8,687 | 1.00 | % | |||||||
| Federal Home Loan Bank Advances / Other Borrowings | 25,598 | 363 | 5.64 | % | 105,087 | 1,433 | 5.41 | % | |||||||
| Total Interest Bearing Deposits and Borrowings | 1,973,924 | 13,451 | 2.71 | % | 1,721,276 | 10,120 | 2.33 | % | |||||||
| Total Deposits and Borrowings | $ | 3,645,581 | $ | 13,451 | 1.47 | % | $ | 3,545,567 | $ | 10,120 | 1.13 | % | |||
| Net Interest Income | $ | 31,367 | $ | 30,278 | |||||||||||
| Net Interest Rate Spread | 2.94 | % | 2.97 | % | |||||||||||
| Net Interest Margin | 3.13 | % | 3.12 | % | |||||||||||
| American Business Bank | |||||||||||||||
| Figures in $000 | |||||||||||||||
| QUARTERLY AVERAGE BALANCE SHEETS AND YIELD ANALYSIS (unaudited) | |||||||||||||||
| For the nine months ended: | |||||||||||||||
| September 2024 | September 2023 | ||||||||||||||
| Average | Interest | Average | Average | Interest | Average | ||||||||||
| Balance | Inc/Exp | Yield/Rate | Balance | Inc/Exp | Yield/Rate | ||||||||||
| Interest Earning Assets: | |||||||||||||||
| Interest Earning Deposits in Other Financial Institutions | $ | 79,252 | $ | 3,218 | 5.42 | % | $ | 20,366 | $ | 739 | 4.85 | % | |||
| Investment Securities: | |||||||||||||||
| US Agencies | 82,882 | 3,500 | 5.63 | % | 109,975 | 3,783 | 4.59 | % | |||||||
| Mortgage Backed Securities | 662,348 | 9,360 | 1.88 | % | 708,057 | 9,977 | 1.88 | % | |||||||
| State and Municipals | 477,708 | 7,855 | 2.19 | % | 501,330 | 8,297 | 2.21 | % | |||||||
| Corporate Bonds | 16,250 | 565 | 4.63 | % | 16,250 | 558 | 4.58 | % | |||||||
| Securities Available-for-Sale and Held-to-Maturity | 1,239,188 | 21,280 | 2.29 | % | 1,335,612 | 22,615 | 2.26 | % | |||||||
| Federal Home Loan Bank Stock | 15,000 | 985 | 8.76 | % | 15,000 | 821 | 7.30 | % | |||||||
| Total Investment Securities | 1,254,188 | 22,265 | 2.37 | % | 1,350,612 | 23,436 | 2.31 | % | |||||||
| Loans Receivable: | |||||||||||||||
| Commercial Real Estate | 1,898,713 | 70,161 | 4.94 | % | 1,805,477 | 62,741 | 4.65 | % | |||||||
| Commercial and Industrial | 470,906 | 23,855 | 6.77 | % | 490,777 | 22,854 | 6.23 | % | |||||||
| Residential Real Estate | 196,348 | 9,323 | 6.34 | % | 173,067 | 7,550 | 5.83 | % | |||||||
| Installment and Other | 8,736 | 196 | 3.00 | % | 7,912 | 210 | 3.56 | % | |||||||
| Total Loans Receivable | 2,574,703 | 103,535 | 5.37 | % | 2,477,233 | 93,355 | 5.04 | % | |||||||
| Total Interest Earning Assets | $ | 3,908,143 | $ | 129,018 | 4.34 | % | $ | 3,848,211 | $ | 117,530 | 4.03 | % | |||
| Liabilities: | |||||||||||||||
| Non-Interest Bearing Demand Deposits | 1,642,483 | - | 0.00 | % | 1,794,366 | - | 0.00 | % | |||||||
| Interest Bearing Transaction Accounts | 386,897 | 3,299 | 1.14 | % | 302,062 | 1,342 | 0.59 | % | |||||||
| Money Market and Savings Deposits | 1,179,180 | 24,247 | 2.75 | % | 1,066,488 | 12,572 | 1.58 | % | |||||||
| Certificates of Deposit | 268,489 | 7,481 | 3.72 | % | 144,986 | 3,255 | 3.00 | % | |||||||
| Total Deposits | 3,477,049 | 35,027 | 1.35 | % | 3,307,902 | 17,169 | 0.69 | % | |||||||
| Federal Home Loan Bank Advances / Other Borrowings | 103,433 | 4,164 | 5.38 | % | 251,363 | 9,394 | 5.00 | % | |||||||
| Total Interest Bearing Deposits and Borrowings | 1,937,999 | 39,191 | 2.70 | % | 1,764,899 | 26,563 | 2.01 | % | |||||||
| Total Deposits and Borrowings | $ | 3,580,480 | $ | 39,191 | 1.46 | % | $ | 3,559,264 | $ | 26,563 | 1.00 | % | |||
| Net Interest Income | $ | 89,827 | $ | 90,967 | |||||||||||
| Net Interest Rate Spread | 2.88 | % | 3.03 | % | |||||||||||
| Net Interest Margin | 3.07 | % | 3.16 | % | |||||||||||
| American Business Bank | |||||||||||||||||
| Figures in $000 | |||||||||||||||||
| SUPPLEMENTAL DATA (unaudited) | |||||||||||||||||
September | June | December | September | ||||||||||||||
2024 | 2024 | 2023 | 2023 | ||||||||||||||
| Performance Ratios: | |||||||||||||||||
| Quarterly: | |||||||||||||||||
| Return on Average Assets (ROAA) | 1.07 | % | 0.97 | % | 1.17 | % | 1.05 | % | |||||||||
| Return on Average Equity (ROAE) | 12.64 | % | 11.93 | % | 16.05 | % | 14.20 | % | |||||||||
| Efficiency Ratio | 53.20 | % | 54.86 | % | 48.45 | % | 54.59 | % | |||||||||
| Year-to-Date | |||||||||||||||||
| Return on Average Assets (ROAA) | 1.04 | % | 1.02 | % | 1.13 | % | 1.12 | % | |||||||||
| Return on Average Equity (ROAE) | 12.66 | % | 12.67 | % | 15.70 | % | 15.58 | % | |||||||||
| Efficiency Ratio | 54.13 | % | 54.63 | % | 50.82 | % | 51.62 | % | |||||||||
| Capital Adequacy: | |||||||||||||||||
| Total Risk Based Capital Ratio | 12.99 | % | 12.84 | % | 12.37 | % | 12.66 | % | |||||||||
| Common Equity Tier 1 Capital Ratio | 12.11 | % | 11.94 | % | 11.47 | % | 11.73 | % | |||||||||
| Tier 1 Risk Based Capital Ratio | 12.11 | % | 11.94 | % | 11.47 | % | 11.73 | % | |||||||||
| Tier 1 Leverage Ratio | 10.17 | % | 10.14 | % | 9.64 | % | 9.41 | % | |||||||||
| Tangible Common Equity / Tangible Assets | 8.68 | % | 8.42 | % | 8.05 | % | 7.21 | % | |||||||||
| Asset Quality Overview | |||||||||||||||||
| Non-Performing Loans | $ | 6,969 | $ | 6,641 | $ | 7,859 | $ | 5,315 | |||||||||
| Loans 90+ Days Past Due and Still Accruing | - | - | - | - | |||||||||||||
| Total Non-Performing Loans | 6,969 | 6,641 | 7,859 | 5,315 | |||||||||||||
| Loans Modified with Financial Difficulty | $ | 4,120 | $ | 4,696 | $ | 231 | $ | 233 | |||||||||
| Other Real Estate Owned | - | - | - | - | |||||||||||||
| ACL / Loans Receivable | 1.11 | % | 1.11 | % | 1.10 | % | 1.10 | % | |||||||||
| Non-Performing Loans / Total Loans Receivable | 0.27 | % | 0.36 | % | 0.30 | % | 0.21 | % | |||||||||
| Non-Performing Assets / Total Assets | 0.17 | % | 0.24 | % | 0.20 | % | 0.14 | % | |||||||||
| Net Charge-Offs (Recoveries) quarterly | $ | 4 | $ | (58 | ) | $ | 190 | $ | (5 | ) | |||||||
| Net Charge-Offs (Recoveries) year-to-date | $ | (155 | ) | $ | (159 | ) | $ | 344 | $ | 154 | |||||||
| Net Charge-Offs (Recoveries) year-to-date / Average Loans Receivable | (0.01 | %) | (0.01 | %) | 0.01 | % | 0.01 | % | |||||||||
Contacts
Karen Schoenbaum
EVP/CFO
(213) 430-4000
www.americanbb.bank
