Community Bank, founded in 1945, is an independent Southern California regional community bank, with assets of $3.6 billion and is headquartered in Pasadena with 16 business centers.
David R. Misch, Chief Executive Officer, commented, “We are very pleased with Bank’s 2015 full year performance and its trajectory for future years. It is a testament to the strength of the Bank’s model, its focused strategy and the effort of its fine staff.”
Annual and quarterly earnings both reached record levels in Community Bank’s 70 year history, including restructuring charges.
The following is a recap of annual and quarterly results for 2015 and 2014 including “proforma” earnings, which exclude the impact of the balance sheet restructuring done in June 2015. The restructuring involved the payoff of $153 million in FHLB advances funded by security sales with a one-time net cost of $3.8 million.
For the YEARS ended December 31,: | Proforma | Actual | Actual | |||||||||||||||
2015 | 2015 | 2014 | ||||||||||||||||
Net income | $ | 31,086 | $ | 27,765 | $ | 25,806 | ||||||||||||
Return on average equity | 10.06 | % | 9.08 | % | 9.22 | % | ||||||||||||
Return on average assets | 0.87 | % | 0.79 | % | 0.75 | % | ||||||||||||
Net interest margin | 3.20 | % | 3.30 | % | 3.20 | % | ||||||||||||
Efficiency ratio | 59.26 | % | 68.07 | % | 64.49 | % | ||||||||||||
For the QUARTERS ended December 31,: | Proforma | Actual | Actual | |||||||||||||||
2015 | 2015 | 2014 | ||||||||||||||||
Net income | $ | 8,441 | $ | 8,693 | $ | 7,012 | ||||||||||||
Return on average equity | 10.58 | % | 11.11 | % | 9.48 | % | ||||||||||||
Return on average assets | 0.92 | % | 0.99 | % | 0.79 | % | ||||||||||||
Net interest margin | 3.11 | % | 3.32 | % | 3.27 | % | ||||||||||||
Efficiency ratio | 56.48 | % | 55.69 | % | 65.73 | % | ||||||||||||
Other highlights:
- Total core deposits increased 2.9% to $2.26 billion as of December 31, 2015 as compared to $2.19 billion as of December 31, 2014. At December 31, 2015, core deposits represented 87% of total deposits. (Note: The Bank defines core deposits as those deposits generated by its branch network including specialty areas. It excludes deposits placed primarily with financial institutions through the Treasury area of the Bank). Non-interest bearing deposits increased 3.9% to $916.7 million as of December 31, 2015 as compared to $882.6 million as of December 31, 2014.
- Total loans as of December 31, 2015 increased 6.5% to $2.43 billion as compared to $2.28 billion as of December 31, 2014. Further, despite a 21% drop in non-performing loans, no amounts were released or added to the reserve for loan losses, for the year 2015.
- From a capital perspective, Community Bank’s capital ratios continue to significantly exceed regulatory requirements to be considered “well capitalized” for regulatory purposes. The ratios as of December 31, 2015 were: 1) Tier 1 Leverage of 8.97%; 2) Tier 1 Common Equity of 10.57%; 3) Tier 1 Risk-based Capital of 10.57% and, 4) Total Risk-based Capital of 11.82%.
Declaration of Dividend:
- The Board of Directors declared a $0.48 per share cash dividend (aggregating approximately $1.5 million) on its outstanding common stock. The dividend was approved at the regularly scheduled Board of Directors meeting held on January 28, 2016. It will be payable on or about March 1, 2016 to common shareholders of record as of February 12, 2016.
Marshall Laitsch, the Bank’s Chairman, commented, “Speaking on behalf of the Cook family and the Board, we are all excited about the direction of the Bank and our 2015 results speak to that.”
Community Bank, partnering to be YOUR community bank, has offices in Anaheim, Burbank, Century City, Commerce, Corona, Fontana, Glendale, Huntington Beach, Irvine, Ontario, Pasadena, Redlands, Santa Clarita, Santa Fe Springs, South Bay, and Woodland Hills. For more information, visit the Community Bank Website at www.cbank.com.
This press release contains certain forward-looking statements, including certain plans, expectations, goals and projections (including statements relating to growth, profitability and future dividends), which are subject to numerous assumptions, risks and uncertainties. You can identify such forward-looking statements by use of the terms “believes,” “plus,” “expects,” “anticipates,” “intends,” “hopes,” “should,” “estimates,” or words of similar meaning. Actual results could differ materially from those contained in or implied by such statements for a variety of factors including: changes in international, national and regional economic conditions including, in particular, changes in the California economy; changes in economic policy; movements in interest rates; changes in the management of the Bank; the condition of our loan portfolio including any deterioration in the portfolio, increased loan delinquency rates, etc.; competitive pressures on product pricing and services; failure to maintain effective internal controls; our income and level of profitability; success and timing of business strategies; natural disasters including earthquakes; changes in consumer confidence; the nature and extent of governmental actions, and legislative reforms; the impact of regulatory and legal proceedings and rapidly changing technology and evolving banking industry standards. The Bank does not update any of its forward-looking statements except as required by law.
COMMUNITY BANK | ||||||||||||||||||||||||||||||||||
Financial Highlights - Income Statement and Ratios (Unaudited) | ||||||||||||||||||||||||||||||||||
(Amounts in Thousands, except per share data) | ||||||||||||||||||||||||||||||||||
For the quarters ended | For the quarters ended | |||||||||||||||||||||||||||||||||
December 31, | December 31, | |||||||||||||||||||||||||||||||||
Proforma (A) | Actual | Dollar | Percent | Actual | Actual | Dollar | Percent | |||||||||||||||||||||||||||
INCOME STATEMENT | 2015 | 2014 | Change | Change | 2015 | 2014 | Change | Change | ||||||||||||||||||||||||||
Interest income | $ | 31,602 | $ | 32,456 | $ | (854 | ) | (2.6 | %) | $ | 30,630 | $ | 32,456 | $ | (1,826 | ) | (5.6 | %) | ||||||||||||||||
Interest expense | 4,172 | 4,426 | (254 | ) | (5.7 | %) | 2,765 | 4,426 | (1,661 | ) | (37.5 | %) | ||||||||||||||||||||||
Net interest income | 27,430 | 28,030 | (600 | ) | (2.1 | %) | 27,865 | 28,030 | (165 | ) | (0.6 | %) | ||||||||||||||||||||||
Provision for loan losses | - | - | - | - | - | - | - | - | ||||||||||||||||||||||||||
Net interest income after provision | 27,430 | 28,030 | (600 | ) | (2.1 | %) | 27,865 | 28,030 | (165 | ) | (0.6 | %) | ||||||||||||||||||||||
Non-interest income | 3,212 | 4,039 | (827 | ) | (20.5 | %) | 3,212 | 4,039 | (827 | ) | (20.5 | %) | ||||||||||||||||||||||
Non-interest expense | 17,307 | 20,508 | (3,201 | ) | (15.6 | %) | 17,307 | 20,508 | (3,201 | ) | (15.6 | %) | ||||||||||||||||||||||
Income before income tax | 13,335 | 11,561 | 1,774 | 15.3 | % | 13,770 | 11,561 | 2,209 | 19.1 | % | ||||||||||||||||||||||||
Income tax | 4,894 | 4,549 | 345 | 7.6 | % | 5,077 | 4,549 | 528 | 11.6 | % | ||||||||||||||||||||||||
Net income | $ | 8,441 | $ | 7,012 | $ | 1,429 | 20.4 | % | $ | 8,693 | $ | 7,012 | $ | 1,681 | 24.0 | % | ||||||||||||||||||
For the years ended | For the years ended | |||||||||||||||||||||||||||||||||
December 31, | December 31, | |||||||||||||||||||||||||||||||||
Proforma (A) | Actual | Dollar | Percent | Actual | Actual | Dollar | Percent | |||||||||||||||||||||||||||
INCOME STATEMENT | 2015 | 2014 | Change | Change | 2015 | 2014 | Change | Change | ||||||||||||||||||||||||||
Interest income | $ | 127,412 | $ | 125,093 | $ | 2,319 | 1.9 | % | $ | 125,468 | $ | 125,093 | $ | 375 | 0.3 | % | ||||||||||||||||||
Interest expense | 16,943 | 18,994 | (2,051 | ) | (10.8 | %) | 14,129 | 18,994 | (4,865 | ) | (25.6 | %) | ||||||||||||||||||||||
Net interest income | 110,469 | 106,099 | 4,370 | 4.1 | % | 111,339 | 106,099 | 5,240 | 4.9 | % | ||||||||||||||||||||||||
Provision for loan losses | - | - | - | - | - | - | - | - | ||||||||||||||||||||||||||
Net interest income after provision | 110,469 | 106,099 | 4,370 | 4.1 | % | 111,339 | 106,099 | 5,240 | 4.9 | % | ||||||||||||||||||||||||
Non-interest income | 12,887 | 11,992 | 895 | 7.5 | % | 17,701 | 11,992 | 5,709 | 47.6 | % | ||||||||||||||||||||||||
Non-interest expense | 72,810 | 75,592 | (2,782 | ) | (3.7 | %) | 84,224 | 75,592 | 8,632 | 11.4 | % | |||||||||||||||||||||||
Income before income tax | 50,546 | 42,499 | 8,047 | 18.9 | % | 44,816 | 42,499 | 2,317 | 5.5 | % | ||||||||||||||||||||||||
Income tax | 19,460 | 16,693 | 2,767 | 16.6 | % | 17,051 | 16,693 | 358 | 2.1 | % | ||||||||||||||||||||||||
Net income | $ | 31,086 | $ | 25,806 | $ | 5,280 | 20.5 | % | $ | 27,765 | $ | 25,806 | $ | 1,959 | 7.6 | % | ||||||||||||||||||
Selected Financial Data and Highlights (Unaudited) | |||||||||||||||||||||||||||||||
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For the quarters ended | For the years ended | ||||||||||||||||||||||||||||||
December 31, | December 31, | ||||||||||||||||||||||||||||||
Proforma (A) | Actual | Actual | Proforma (A) | Actual | Actual | ||||||||||||||||||||||||||
2015 | 2015 | 2014 | 2015 | 2015 | 2014 | ||||||||||||||||||||||||||
Return on average equity | 10.58 | % | 11.11 | % | 9.48 | % | 10.06 | % | 9.08 | % | 9.22 | % | |||||||||||||||||||
Return on average assets | 0.92 | % | 0.99 | % | 0.79 | % | 0.87 | % | 0.79 | % | 0.75 | % | |||||||||||||||||||
Net interest margin | 3.11 | % | 3.32 | % | 3.27 | % | 3.20 | % | 3.30 | % | 3.20 | % | |||||||||||||||||||
Efficiency ratio | 56.48 | % | 55.69 | % | 65.73 | % | 59.26 | % | 68.07 | % | 64.49 | % | |||||||||||||||||||
Book value per common share | $ | 101.34 | $ | 99.38 | $ | 94.81 | |||||||||||||||||||||||||
Basic earnings per common share | $ | 2.70 | $ | 2.78 | $ | 2.24 | $ | 9.94 | $ | 8.88 | $ | 8.26 | |||||||||||||||||||
Diluted earnings per common share | $ | 2.70 | $ | 2.78 | $ | 2.24 | $ | 9.94 | $ | 8.88 | $ | 8.25 | |||||||||||||||||||
December 31, | |||||||||||||||||||||||||||||||
Proforma (A,B) | Actual (B) | Actual | Minimum Ratios for a | ||||||||||||||||||||||||||||
CAPITAL RATIOS | 2015 | 2015 | 2014 | Well-Capitalized Bank | |||||||||||||||||||||||||||
Tier 1 leverage capital | 8.67 | % | 8.97 | % | 8.24 | % | 5.00 | % | |||||||||||||||||||||||
Tier 1 risk-based capital | 10.59 | % | 10.57 | % | 10.62 | % | 8.00 | % | |||||||||||||||||||||||
Total risk-based capital | 11.84 | % | 11.82 | % | 11.87 | % | 10.00 | % | |||||||||||||||||||||||
Tier 1 common capital | 10.59 | % | 10.57 | % | 10.62 | % | 6.50 | % | |||||||||||||||||||||||
As of December 31, | |||||||||||||||||||||||||||||||
Proforma (A) | Actual | Actual | |||||||||||||||||||||||||||||
OTHER SELECTED DATA | 2015 | 2015 | 2014 | ||||||||||||||||||||||||||||
Other real estate owned | $ | 8,089 | $ | 8,089 | $ | 5,055 | |||||||||||||||||||||||||
Nonperforming loans | $ | 11,979 | $ | 11,979 | $ | 15,256 | |||||||||||||||||||||||||
Reserve for loan losses to total loans | 1.50 | % | 1.50 | % | 1.55 | % | |||||||||||||||||||||||||
Reserve for loan losses to nonperforming loans | 303.26 | % | 303.26 | % | 231.57 | % | |||||||||||||||||||||||||
Nonperforming loans to total loans | 0.49 | % | 0.49 | % | 0.67 | % | |||||||||||||||||||||||||
Nonperforming assets to total assets | 0.54 | % | 0.57 | % | 0.57 | % | |||||||||||||||||||||||||
(A) | Proforma information is shown to reflect the Bank's performance results excluding the impact of the Balance Sheet restructuring strategy executed in June as described in the June 12, 2015 press release. | |
(B) | The risk based and common capital ratios reflect the impact of Basel III standards, effective January 1, 2015, which approximates a decrease of 20bps. |
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