California Bank of Commerce (OTCBB:CABC) announced unaudited financial results for the Quarter and Full Year ending December 31, 2011. The Bank achieved record levels of pre-tax Net Income as well as Total Loans, Total Deposits, and Total Assets for the Fourth Quarter and Full Year 2011.

"Our Bank continues to grow its Loan and Deposit book steadily. We have now achieved a scale that affords us ample new commercial business opportunities throughout the Bay Area. We finished 2011 well positioned for the future," commented John Rossell, President and CEO.

Highlights: 2011 versus 2010

  • Total Loans grew $32 million or 18%, to $208 million
  • Total Deposits grew $60 million or 33%, to $244 million
  • Net Interest Income grew $1.5 million or 20%, to $9.1 million
  • Net Interest Margin improved by 16 basis points to 3.73% from 3.57%
  • Pre-tax Income grew $1.2 million or 368% to $1.5 million

Highlights: Fourth Quarter 2011 versus Third Quarter 2011

  • Total Loans grew $7 million or 4%, to $208 million
  • Total Deposits grew $24 million or 11%, to $244 million
  • Net Interest Income grew $170,000 or 7% to $2.5 million
  • Pre-tax Income grew $176,000 or 47% to $555,000

Highlights: Fourth Quarter 2011 versus Fourth Quarter 2010

  • Net Interest Income grew $583,000 or 30% to $2.5 million
  • Pre-tax Income grew $596,000 to $555,000 from a loss of ($41,000) for the Fourth Quarter of 2010

2011 Earnings and Margins

Net Income for the Full Year 2011 was $ 788,000 or $0.29 per share, before preferred stock dividends of $0.06 per share compared with $3,366,000 for the Full Year 2010, or $1.22 per share, before preferred stock dividends of $0.08 per share. Net Income for the Full Year 2010 included a tax benefit of $3,051,000 or $1.11 per share, related to the tax benefit associated with the Bank's start-up losses.

Pre-tax Income for the Full Year 2011 was $1,476,000 versus $315,000 for the Full Year 2010.

Net Interest Income for the Full Year 2011 was $9.1 million, compared to $7.6 million last year. The increase was due both to loan growth and to improved net interest margins.

Net Interest Margin was 3.73% for the Full Year 2011 versus 3.57% for the same period last year. Yield on Loans was 5.43% in 2011, up 10 basis points compared to 5.33% in 2010. Investment yields declined sharply from last year, as short and intermediate term rates declined over the course of a volatile year. The Cost of Interest Bearing Deposits was 0.74% for the Full Year 2011, down 13 basis points from 0.87% in 2010.

2011 Overhead Expenses

Non Interest Expense grew 24% year-over-year, due in part to the addition of two new business units - CBC Business Credit, an asset based lending group, and the Dental and Medical Practice Financing Group. Despite these additions, for the Full Year 2011, the Bank maintained a ratio of Total Non-interest Expense to Average Total Assets of 2.87%. Total Assets per Employee improved year over year averaging $7.3 million per employee for 2011 versus $7.2 million in 2010.

2011 Balance Sheet Growth

Total Loans were a record $208 million at December 31, 2011, increasing 18% over December 31, 2010. Total Deposits also recorded an all time high in 2011, reaching $244 million at December 31, 2011, up 33% or $60 million over December 31, 2010. Non-Interest bearing Deposits of $55 million at year-end, 2011, constituted 22% of Total Deposits and were up 35% over December 31, 2010.

Total Assets were $299 million at December 31, 2011, up 25% over December 31, 2010. The Bank's liquidity position remained strong, with $83 million in Cash and Investments, or 28% of Total Assets at December 31, 2011.

Asset Quality

During the course of 2011, the Bank reduced Non-Performing Assets (NPA) from their peak in the Fourth Quarter of 2010. At December 31, 2011, the Bank's NPAs to Total Assets Ratio was 0.33% compared to 0.85% at December 31, 2010. The Bank holds no foreclosed assets. The Bank concluded the Fourth Quarter 2011 with a Loan Loss Reserve equal to 2.01% of Total Loans, affording a coverage ratio of Loan Loss Reserves to Non-Accrual Loans of 4.23X, in comparison to a ratio of 2.13X at December 31, 2010.

Capital

During the course of 2011, the Bank added $11 million of new preferred stock at a dividend rate of 1%, from the Government's Small Business Loan Fund (SBLF). These proceeds were used to permanently retire $4.2 million of TARP preferred stock, which had borne a dividend rate of 5%, and to strengthen the Bank's Tier-1 Capital position to allow for continued growth.

The Bank's overall capital position remains strong, with all regulatory capital ratios in excess of the regulatory "well capitalized" standards. Tier-1 Leverage ratio was 11.4% at December 31, 2011 compared to 10.7% on the same date last year. Total Risk Based Capital was 15.2% at December 31, 2011 compared to 12.1% last year.

Concluding CEO Comment

"Our Bank has concluded another outstanding year, our fourth full year of operations. The Bank's reputation is now well established and growing, thanks to a dedicated and experienced staff and to a clientele that sees in us the same valuable partner that we see in them," said Rossell.

About California Bank of Commerce

California Bank of Commerce was designed and built to provide a unique banking experience for its clients. The Bank offers a broad range of commercial banking services to closely held businesses and professionals throughout the San Francisco Bay Area. For more information on California Bank of Commerce and our unique banking experience, call us at 925-283-2265, or visit us at www.californiabankofcommerce.com.

CALIFORNIA BANK OF COMMERCE
UNAUDITED SUMMARY FINANCIAL STATEMENTS

INCOME STATEMENT
($ Thousands)

         
Three Months Ended Twelve Months Ended
31-Dec-11 30-Sep-11 31-Dec-10 31-Dec-11 31-Dec-10
Interest income $ 2,949 $ 2,771 $ 2,336 $ 10,689 $ 9,196
Interest expense   (418 )   (410 )   (387 )   (1,555 )   (1,556 )
Net interest income before provision $ 2,531 $ 2,361 $ 1,949 $ 9,134 $ 7,640
Provision to the Loan Loss Reserve   (160 )   (381 )   (812 )   (1,154 )   (2,095 )
Net interest income after provision $ 2,371 $ 1,980 $ 1,137 $ 7,980 $ 5,545
 
Non-interest income 215 199 278 834 707
Non-interest expense   (2,031 )   (1,800 )   (1,456 )   (7,338 )   (5,937 )
Income before tax provision 555 379 (41 ) 1,476 315
(Provision) Benefit for income taxes   (242 )   (179 )   3,051     (688 )   3,051  
Net income - Period $ 313   $ 200   $ 3,010   $ 788   $ 3,366  
 
 
Earnings Per Common Share
Income per Common share $ 0.114 $ 0.073 $ 1.095 $ 0.287 $ 1.224
Basic Income (loss) per Common share $ 0.102 $ 0.066 $ 1.075 $ 0.229 $ 1.145
 
Weighted average shares outstanding 2,750,000 2,750,000 2,750,000 2,750,000 2,750,000
 

CALIFORNIA BANK OF COMMERCE
UNAUDITED SUMMARY FINANCIAL STATEMENTS

BALANCE SHEET
($ Thousands)

       
Assets 31-Dec-11 30-Sep-11 31-Dec-10 12 Month
% Change
Total Cash and Investments $ 84,731 $ 69,850 $ 61,669 37%
Loans, net of deferred costs/fees 208,119 200,740 175,791 18%
Loan Loss Reserve (4,175 ) (3,990 ) (4,327 ) -4%
Other   9,865     9,903     6,550   51%
Total Assets $ 298,540   $ 276,503   $ 239,683   25%
 
Liabilities & Shareholders' Equity
Non-interest Bearing Deposits $ 55,465 $ 54,339 $ 41,091 35%
Interest Bearing Deposits   188,438     165,129     142,526   32%
Total Deposits $ 243,903 $ 219,468 $ 183,617 33%
Total Borrowings and Other Liabilities   19,999     22,663     29,107   -31%
Total Liabilities $ 263,902 $ 242,131 $ 212,724 24%
 
Shareholder's Equity $ 34,638   $ 34,372   $ 26,959   28%
 
Total Liabilities & Shareholders' Equity $ 298,540   $ 276,503   $ 239,683   25%
 
 
Book Value per Common Share $ 8.61 $ 8.51 $ 8.34 3%
 
Quarterly Information
Net Interest Margin 3.63 % 3.69 % 3.58 %
Yield on Earning Assets 4.22 % 4.33 % 4.26 %
Cost of Interest Bearing Liabilities 0.85 % 0.90 % 0.94 %
 
Loan Loss Reserve to Total Loans 2.01 % 1.99 % 2.47 %
NPAs to Total Assets 0.33 % 0.40 % 0.85 %
 
Leverage Ratio 11.4 % 12.3 % 10.7 %
Tier 1 Risk Based Capital Ratio 13.9 % 14.2 % 10.8 %
Total Risk Based Capital Ratio 15.2 % 15.4 % 12.1 %
 
Non Interest Expense to Avg. Total Assets 2.77 % 2.69 % 2.51 %
Efficiency Ratio 74.0 % 70.3 % 65.4 %

California Bank of Commerce
John Rossell or Mark DeVincenzi, 925-283-2265