The Company’s Board of Directors declared a quarterly cash dividend of
“The third quarter began to reflect the earnings potential of June’s
“Our purpose driven, relationship banking model also continues to resonate with businesses and organizations who maintain deposits with us. Strong third quarter deposit growth, especially in Money Markets pushed Total Assets above
“Higher than typical liquidity levels, and the resulting effect on the mix of our earning assets, put pressure our net interest margin during the quarter. As we continue to deploy this new capital into loan production and other higher yielding assets, we should better recognize the full benefit of the
“Overall credit quality remains very strong and we believe that we have adequate provisions in place to navigate the uncertain economic environment and our coming conversion to the CECL loan loss methodology,” said
Third Quarter 2022 Financial Highlights (at or for the period ended
- Net income was
$2.21 million in the third quarter of 2022, compared to$1.57 million in the third quarter a year ago, and$1.84 million in the preceding quarter. Earnings per common share was$0.25 in the third quarter of 2022, compared to$0.21 in the prior quarter, and$0.18 in the third quarter a year ago. - Pre-tax, pre-provision, pre-CDFI grant income was
$3.14 million in the third quarter of 2022, compared to$2.83 million in the second quarter of 2022, and$2.37 million in the third quarter of 2021. - Total assets increased
$264.5 million , or 35.3%, to$1.014 billion atSeptember 30, 2022 , compared to$749.7 million a year earlier, and increased$127.9 million , or 14.4%, compared to$886.4 million three months earlier. Average assets for the quarter totaled$910.4 million , an increase of$152.0 million , or 20.5%, from the third quarter a year ago and an increase of$84.8 million , or 10.3%, compared with the prior quarter. - Net interest income, before the provision for loan losses, increased 24.5% to
$7.77 million in the third quarter of 2022, compared to$6.25 million in the third quarter a year ago. There was no provision for loan losses recorded in the third quarter of 2022, compared to a$150,000 provision for loan losses in the third quarter of 2021. - Non-interest income was
$205,000 in the third quarter of 2022, compared to$376,000 in the second quarter of 2022, and$173,000 in the third quarter a year ago. - Operating revenue (net interest income before the provision for loan losses plus non-interest income) increased 24.3% to
$7.98 million in the third quarter of 2022, compared to$6.42 million in the third quarter a year ago, and increased 5.2% compared to$7.59 million in the second quarter of 2022. - Net interest margin for the third quarter was 3.48%, compared to 3.63% in the preceding quarter and 3.39% in the third quarter a year ago. The contraction in net interest margin in the third quarter of 2022 was largely due to the increase in liquidity from the capital raise during the current quarter, compared to the preceding quarter. The average interest yield on non-PPP loans in the third quarter was 4.75%, compared to 4.53% in the prior quarter. The average cost of funds in the third quarter was 0.76%, a 46 basis point increase compared to the prior quarter and a 51 basis points increase compared to the prior year quarter.
- Loans, net of unearned income, increased
$79.1 million , or 15.2%, to$597.8 million atSeptember 30, 2022 , compared to$518.7 million a year ago, and increased$7.42 million , or 1.3%, compared to$590.4 million three months earlier. Loan growth, excluding PPP, totaled$9.74 million for the quarter, driving increased interest income. AtSeptember 30, 2022 , net non-PPP loans totaled$595.8 million , a 1.7% increase compared to$586.1 million atJune 30, 2022 , and a 30.9% increase compared to$455.2 million atSeptember 30, 2021 . In addition, atSeptember 30, 2022 , the unused portion of credit commitments totaled$167.4 million compared to$153.9 million in the prior quarter and$174.8 million a year ago. - Over the last two years, the Company was an active participant in the SBA PPP, resulting in over
$158.0 million in PPP loans originated over the course of the two rounds of the program. At quarter end, the Company had a total of$2.0 million in gross PPP loans remaining on its books. Approximately$60,000 of the fee income recognized during the third quarter of 2022 was related to these PPP loan payoffs, compared to$313,000 of the fee income recognized during the prior quarter. AtSeptember 30, 2022 , approximately$50,000 in net unrecognized fee income remained to be recognized in relation to the PPP loan portfolio, which is predominantly expected during the next few quarters. - Total deposits increased
$149.1 million , or 22.8%, to$803.6 million atSeptember 30, 2022 , compared to$654 .4 million a year ago, and increased$131.1 million , or 19.5%, compared to$672.5 million three months earlier. Noninterest bearing demand deposit accounts decreased 10.6% compared to a year ago and represented 28.5% of total deposits. Savings, NOW and money market accounts increased 26.4% compared to a year ago and represented 53.2% of total deposits. Due to rising interest rates, CDs increased 143.5% compared to a year ago and comprised 18.4% of the total deposit portfolio, atSeptember 30, 2022 . For the quarter, the overall cost of deposits was 76 basis points (“bp”) compared to 30 bp in the prior quarter, and 25 bp in the third quarter a year ago. - Asset quality remained very strong with no nonperforming loans at
September 30, 2022 or atJune 30, 2022 . This compares to nonperforming loans at 0.006% of total loans atSeptember 30, 2021 . - The allowance for loan losses was
$6.91 million , or 1.16% of total loans atSeptember 30, 2022 , compared to$6.08 million , or 1.17% of total loans atSeptember 30, 2021 . The allowance, as a percentage of non-guaranteed loans, was 1.17% atSeptember 30, 2022 , compared to 1.37% a year ago. The allowance for loan losses reflects management’s assessment of the current economic environment. - Primarily due to the capital raise, total equity increased 172.1% to
$181.9 million as ofSeptember 30, 2022 , compared to$66.9 million a year ago. The Bank’s capital levels remained well aboveFDIC “Well Capitalized” standards as ofSeptember 30, 2022 , with a Tier 1 capital ratio of 29.02%; Common Equity Tier 1 capital ratio of 10.69%; Total capital ratio of 30.11%; and Leverage ratio of 20.76%. - Book value per common share totaled
$7.27 as ofSeptember 30, 2022 , compared to$7.54 per common share a year ago. - Declared a quarterly cash dividend of
$0.045 per share. The dividend is payableDecember 5, 2022 to shareholders of record onNovember 28, 2022 .
On
On
While the ECIP capital investment was an extraordinary event brought on by the Federal response to the pandemic, the Bank has maintained a long and important relationship with the US Treasury’s
For additional information on the US Treasury’s ECIP Program please visit
https://home.treasury.gov/policy-issues/coronavirus/assistance-for-small-businesses/emergency-capital-investment-program
For additional information on the CDFI Fund’s Rapid Response Program please visit
https://www.cdfifund.gov/programs-training/programs/rrp
For additional information on the CDFI Fund’s Equitable Recovery Program please visit
https://www.cdfifund.gov/programs-training/programs/erp
About
Forward-Looking Statements
This release may contain forward-looking statements, such as, among others, statements about plans, expectations and goals concerning growth and improvement. Forward-looking statements are subject to risks and uncertainties. Such risks and uncertainties may include but are not necessarily limited to fluctuations in interest rates, inflation, government regulations and general economic conditions, including the real estate market in
FINANCIAL TABLES TO FOLLOW:
UNAUDITED SUMMARY FINANCIAL STATEMENTS | ||||||||||||||||||||
(Dollars in thousands, except earnings per share) | ||||||||||||||||||||
INCOME STATEMENT | Three Months Ended | |||||||||||||||||||
2022 | 2022 | Qtr over Qtr | 2021 | Qtr over Yr Ago Qtr | ||||||||||||||||
% Change | % Change | |||||||||||||||||||
Interest income | $ | 9,151 | $ | 7,756 | 18.0 | % | $ | 6,677 | 37.1 | % | ||||||||||
Interest expense | 1,377 | 544 | 153.1 | % | 432 | 218.8 | % | |||||||||||||
Net interest income before provision | 7,774 | 7,212 | 7.8 | % | 6,245 | 24.5 | % | |||||||||||||
Provision for Loan Losses | - | 400 | -100.0 | % | 150 | -100.0 | % | |||||||||||||
Net interest income after provision | 7,774 | 6,812 | 14.1 | % | 6,095 | 27.5 | % | |||||||||||||
Non-interest income | 205 | 376 | -45.5 | % | 173 | 18.5 | % | |||||||||||||
Non-interest expense | 4,835 | 4,583 | 5.5 | % | 4,045 | 19.5 | % | |||||||||||||
Income before provision for income taxes | 3,144 | 2,605 | 20.7 | % | 2,223 | 41.4 | % | |||||||||||||
Provision for income taxes | 930 | 769 | 20.9 | % | 654 | 42.2 | % | |||||||||||||
Net income | $ | 2,214 | $ | 1,836 | 20.6 | % | $ | 1,569 | 41.1 | % | ||||||||||
Basic earnings per common share | $ | 0.25 | $ | 0.21 | 23.2 | % | $ | 0.18 | 43.2 | % | ||||||||||
Weighted average common shares outstanding | 8,685,400 | 8,871,052 | 8,811,945 | |||||||||||||||||
Return on average assets | 0.96 | % | 0.89 | % | 0.82 | % | ||||||||||||||
Return on average common equity | 13.37 | % | 11.02 | % | 9.39 | % | ||||||||||||||
UNAUDITED SUMMARY FINANCIAL STATEMENTS | ||||||||||||||||||||
(Dollars in thousands, except book value per share) | ||||||||||||||||||||
BALANCE SHEET | At Period End | |||||||||||||||||||
2022 | 2021 | Qtr over Qtr | 2021 | Year over Year | ||||||||||||||||
ASSETS | % Change | % Change | ||||||||||||||||||
Total cash and investments | 396,257 | 278,106 | 42.5 | % | 217,429 | 82.2 | % | |||||||||||||
Loans, net of unearned income | 597,790 | 590,368 | 1.3 | % | 518,702 | 15.2 | % | |||||||||||||
Loan loss reserve | (6,911 | ) | (6,902 | ) | 0.1 | % | (6,081 | ) | 13.6 | % | ||||||||||
Other assets | 27,114 | 24,824 | 9.2 | % | 19,669 | 37.9 | % | |||||||||||||
Total Assets | $ | 1,014,250 | $ | 886,396 | 14.4 | % | $ | 749,719 | 35.3 | % | ||||||||||
LIABILITIES AND SHAREHOLDERS EQUITY | ||||||||||||||||||||
Non-interest bearing demand deposits | 228,651 | 238,608 | -4.2 | % | 255,813 | -10.6 | % | |||||||||||||
Interest bearing deposits | 574,930 | 433,921 | 32.5 | % | 398,632 | 44.2 | % | |||||||||||||
Total deposits | 803,581 | 672,529 | 19.5 | % | 654,445 | 22.8 | % | |||||||||||||
Total borrowings and other liabilities | 28,785 | 27,887 | 3.2 | % | 28,422 | 1.3 | % | |||||||||||||
Total Liabilities | $ | 832,366 | $ | 700,416 | 18.8 | % | $ | 682,867 | 21.9 | % | ||||||||||
Preferred equity | 119,413 | 119,413 | 0.0 | % | - | n/a% | ||||||||||||||
Common equity | 62,471 | 66,567 | -6.2 | % | 66,852 | -6.6 | % | |||||||||||||
Total Equity | $ | 181,884 | $ | 185,980 | -2.2 | % | $ | 66,852 | 172.1 | % | ||||||||||
Total Liabilities and Total Equity | $ | 1,014,250 | $ | 886,396 | 14.4 | % | $ | 749,719 | 35.3 | % | ||||||||||
Book value per common share | $ | 7.27 | $ | 7.50 | -3.1 | % | $ | 7.54 | -3.5 | % | ||||||||||
SELECTED FINANCIAL DATA | |||||||||
(In thousands of dollars, except for ratios and per share amounts) | |||||||||
Unaudited | |||||||||
At or for the Three Months Ended | |||||||||
2022 | 2022 | 2021 | |||||||
ASSET QUALITY RATIOS | |||||||||
Net (charge-offs) recoveries | 8 | 2 | - | ||||||
Net (charge-offs) recoveries to average loans | 0.001 | % | 0.000 | % | 0.000 | % | |||
Non-performing loans as a % of loans | 0.000 | % | 0.000 | % | 0.006 | % | |||
Non-performing assets as a % of assets | 0.000 | % | 0.000 | % | 0.004 | % | |||
Allowance for loan losses as a % of total loans | 1.16 | % | 1.17 | % | 1.17 | % | |||
Allowance for loan losses as a % of total unguaranteed loans | 1.17 | % | 1.19 | % | 1.37 | % | |||
Allowance for loan losses as a % of non-performing loans | n/a | n/a | 19508 | % | |||||
AVERAGE BALANCE SHEET DATA | |||||||||
Average assets | 910,388 | 825,630 | 758,371 | ||||||
Average total loans | 596,001 | 545,985 | 520,637 | ||||||
Average total deposits | 697,174 | 695,944 | 660,673 | ||||||
Average shareholders' common equity | 65,688 | 66,833 | 66,315 | ||||||
FINANCIAL RATIOSSTATISTICS | |||||||||
Return on average assets | 0.96 | % | 0.89 | % | 0.82 | % | |||
Return on average common equity | 13.37 | % | 11.02 | % | 9.39 | % | |||
Net interest margin | 3.48 | % | 3.63 | % | 3.39 | % | |||
Efficiency ratio | 60.60 | % | 60.40 | % | 63.03 | % | |||
Contacts:
510-433-5404
wkeller@BankCBB.com
Source:
2022 GlobeNewswire, Inc., source