Grandpoint Capital, Inc., the holding company for Grandpoint Bank and its divisions, Bank of Tucson, Regents Bank and The Biltmore Bank of Arizona, reported net income of $24.4 million for the year ended December 31, 2017. Total assets at December 31, 2017, were $3.2 billion. In addition, the board of directors declared its ninth consecutive quarterly cash dividend. The cash dividend of $0.15 per share will be payable on or about February 14, 2018, to shareholders of record as of January 31, 2018.

“We had a strong year in 2017 as we continued to build our business at a sustainable, measured pace,” said Don M. Griffith, Chairman and CEO of Grandpoint Capital, Inc., and Grandpoint Bank. “We saw substantial growth in our core deposits, which speaks to the strength of our long-standing client relationships, and we continued to operate a very safe bank, building our balance sheet with quality assets.

“During the fourth quarter 2017, we had several nonrecurring items that reduced our tangible book value, capital ratios and earnings,” said Griffith. “In November, we declared a one-time special dividend of $1.25 per share, and in December, we had to charge off $6.6 million of our deferred tax assets to reflect the reduction in federal income tax rates on corporations. In spite of these major adjustments, we still achieved a return on average assets of 0.76% and a return on average tangible equity of 7.52%, and we reported basic earnings per share of $0.74 and tangible book value per share of $8.75.” The lower federal tax rate will increase earnings by almost 20% in 2018 and beyond.

At December 31, 2017, deposits totaled $2.4 billion of which 46% is comprised of non-interest-bearing deposits. During 2017, we focused on developing a more liquid and stable deposit base by replacing non-core high-cost money market accounts with core business demand deposit relationships.

Total loans were $2.4 billion, and asset quality remained strong during the quarter as the Bank continued to maintain a prudent and disciplined risk strategy. Grandpoint Bank’s capital ratios remain in excess of the regulatory minimums, with a Leverage Ratio of 9.18% and Total Risk-Based Capital Ratio of 11.30% at December 31, 2017.

In December 2017, Grandpoint Bank received a superior 5-star rating from independent rating and research firm BauerFinancial for the eighteenth consecutive quarter. The latest rating was based on September 30, 2017, financial data. The 5-star rating, for strength, stability and soundness, is only awarded to the nation’s strongest banks.

Grandpoint Capital, Inc. and Grandpoint Bank are headquartered in Los Angeles. Calif. Grandpoint Bank and its divisions operate in southern California, Arizona and Vancouver, Wash.

More information about Grandpoint is available at www.grandpointbank.com.

 
Grandpoint Capital, Inc. and Subsidiaries
Consolidated Balance Sheets
Dollars in $1,000's
                 
June 30, December 31,
  2010     2010     2011     2012     2013     2014     2015     2016     2017  
 
Cash and due from banks $ 3,501 $ 27,791 $ 22,324 $ 43,714 $ 41,177 $ 37,688 $ 25,113 $ 28,919 $ 32,238
Interest-bearing deposits in banks   72,825     33,604     127,803     291,545     171,408     314,005     171,625     213,365     151,556  
Cash and Cash Equivalents 76,326 61,395 150,127 335,259 212,585 351,693 196,738 242,284 183,794
Investment Securities 3,284 97,399 208,939 318,501 230,591 266,479 573,260 579,275 502,615
Loans:
Construction 481 18,327 20,324 54,315 79,588 110,286 130,801 194,471 137,165
Single family residential - 32,753 86,257 193,913 248,727 281,678 269,823 220,519 171,360
Multifamily loans 2,513 26,097 60,718 135,966 215,956 397,712 599,470 715,786 719,698
Commercial real estate 7,792 248,343 429,224 738,540 777,875 814,430 862,014 905,534 946,072
Commercial and industrial 2,005 83,847 136,492 295,199 371,341 375,607 412,051 322,419 345,475
Consumer   -     3,673     6,226     21,984     23,289     12,846     9,138     7,876     43,712  
Total Loans 12,791 413,040 739,241 1,439,917 1,716,776 1,992,559 2,283,297 2,366,605 2,363,482
Deferred loan fees, costs and discounts (137 ) (13,861 ) (15,580 ) (25,373 ) (18,410 ) (4,543 ) 3,550 3,199 65
Allowance for loan losses   -     (1,050 )   (5,722 )   (8,867 )   (12,087 )   (14,018 )   (17,245 )   (18,552 )   (18,939 )
Net Loans 12,654 398,129 717,939 1,405,677 1,686,279 1,973,998 2,269,602 2,351,252 2,344,608
Goodwill 2,563 17,923 37,863 51,432 53,101 53,323 53,323 53,323 53,323
Core deposit and other intangibles 133 2,724 6,857 11,822 12,765 11,063 9,209 7,493 5,865
Deferred Tax Assets - 4,056 12,011 30,997 30,981 30,206 24,749 23,818 15,686
Other assets   2,981     19,005     24,959     50,195     48,987     79,210     70,107     69,491     88,043  
Total Assets $ 97,941   $ 600,631   $ 1,158,695   $ 2,203,883   $ 2,275,289   $ 2,765,972   $ 3,196,988   $ 3,326,936   $ 3,193,934  
Deposits:
Demand deposits $ 3,664 $ 136,024 $ 327,638 $ 736,831 $ 764,936 $ 792,896 $ 852,263 $ 926,594 $ 1,090,900
NOW accounts 547 22,651 57,302 88,994 132,743 136,003 139,660 148,071 145,591
Money market accounts 7,984 246,043 473,107 723,125 689,318 1,029,519 1,165,748 1,106,229 843,920
Savings accounts 1,353 4,703 9,403 20,587 36,914 35,505 39,979 47,426 44,837
Time deposits   5,618     78,353     112,407     298,226     313,788     411,908     348,068     347,775     251,681  
Total Deposits 19,166 487,774 979,857 1,867,763 1,937,699 2,405,831 2,545,718 2,576,095 2,376,929
Other liabilities 2,840 10,400 14,084 18,596 15,496 27,233 10,594 12,696 12,353
Other Borrowings - - 3,000 10,500 11,000 - 275,000 350,000 450,000
Subordinated debenture payable - 5,155 5,155 5,155 5,155 5,155 5,155 5,155 5,155
Shareholders' Equity:
Common stock, par value 95 116 181 323 324 324 329 330 332
Additional Paid-In Capital 88,729 108,628 171,236 306,060 308,882 310,860 316,623 318,904 320,935
Unrealized gain (loss) on investment securities 23 (52 ) 150 1,410 (3,756 ) (1,090 ) (3,834 ) (1,009 ) (646 )
Retained earnings (deficit)   (12,912 )   (16,073 )   (21,233 )   (5,924 )   489     17,659     47,403     64,765     28,876  
Total Grandpoint Capital Shareholders' Equity 75,935 92,619 150,334 301,869 305,939 327,753 360,521 382,990 349,497
Noncontrolling interest   -     4,683     6,265     -     -     -     -     -     -  
Total Shareholders' Equity   75,935     97,302     156,599     301,869     305,939     327,753     360,521     382,990     349,497  
Total Liabilities and Shareholders' Equity $ 97,941   $ 600,631   $ 1,158,695   $ 2,203,883   $ 2,275,289   $ 2,765,972   $ 3,196,988   $ 3,326,936   $ 3,193,934  
 
Tangible book value $ 73,239 $ 76,655 $ 107,764 $ 238,615 $ 240,073 $ 263,367 $ 297,989 $ 322,174 $ 290,309
Shares outstanding 9,543,057 11,660,098 18,183,867 32,353,019 32,424,261 32,445,179 32,894,185 33,022,742 33,174,924
Book value per share $ 7.96 $ 7.94 $ 8.27 $ 9.33 $ 9.44 $ 10.10 $ 10.96 $ 11.60 $ 10.53
Tangible book value per share $ 7.67 $ 6.57 $ 5.93 $ 7.38 $ 7.40 $ 8.12 $ 9.06 $ 9.76 $ 8.75
 
               
Grandpoint Capital, Inc. and Subsidiaries
Consolidated Income Statements
Dollars in $1,000's
 
Year Ended December 31,
  2010     2011     2012     2013     2014     2015     2016     2017  
 
Interest Income $ 2,117 $ 44,715 $ 69,166 $ 93,618 $ 102,882 $ 114,714 $ 123,511 $ 128,367
Interest Expense   204     4,174     4,109     4,248     4,826     5,883     8,256     12,242  
Net Interest Income 1,913 40,541 65,057 89,370 98,056 108,831 115,255 116,125
 
Provision for Loan Losses 1,050 6,046 5,494 3,799 4,317 3,732 1,135 335
Noninterest Income 5,927 4,726 8,074 7,061 6,049 6,660 5,946 7,955
 
Noninterest Expense:
Salaries and Benefits 6,898 22,343 34,891 44,292 40,270 38,719 40,462 47,406
Occupancy Expenses 1,021 3,102 4,591 5,380 5,569 5,186 5,405 5,439
Furniture and Equipment Expenses 883 2,077 2,991 3,352 3,610 3,288 3,283 3,435
Promotion Expenses 738 1,178 1,385 1,941 1,620 1,217 1,292 1,358
Data Processing Expenses 307 1,264 2,020 2,580 1,862 1,908 2,015 2,120
Professional Services 1,292 2,826 3,820 4,263 2,406 2,709 2,683 3,105
M&A, Conversion and Restructuring Costs 2,346 5,984 947 10,304 3,988 - 300 236
Office Supplies and Costs 293 787 1,284 1,481 1,755 1,422 1,358 1,390
Assessments and Insurance 215 1,428 1,880 2,195 2,377 2,464 2,388 1,859
Loan Expenses - - 1,785 1,703 3,108 1,849 1,499 1,227
Other Expenses   259     3,104     2,924     4,400     4,239     3,889     3,909     4,055  
  14,252     44,093     58,518     81,891     70,804     62,651     64,594     71,630  
 
Income before Income Taxes (7,462 ) (4,872 ) 9,119 10,741 28,984 49,108 55,472 52,115
Income Taxes   (374 )   -     (6,316 )   4,328     11,814     19,364     22,286     27,673  
 
Net Income   (7,088 )   (4,872 )   15,435     6,413   $ 17,170   $ 29,744   $ 33,186   $ 24,442  
 
EPS - basic $ (1.19 ) $ (0.35 ) $ 0.61 $ 0.20 $ 0.53 $ 0.91 $ 1.01 $ 0.74
ROAA -2.36 % -0.53 % 0.96 % 0.29 % 0.70 % 1.00 % 1.03 % 0.76 %
ROATE -11.29 % -4.08 % 6.82 % 2.10 % 5.24 % 10.52 % 10.71 % 7.52 %
Efficiency Ratio 181.79 % 97.41 % 80.02 % 84.92 % 68.01 % 54.25 % 53.29 % 57.73 %