Pacific Mercantile Bancorp reported unaudited consolidated financial results for the fourth quarter and year ended December 31, 2017. For the quarter, the company reported total interest income of $13,812,000 against $10,612,000 a year ago. Net interest income was $11,270,000 against $9,150,000 a year ago. Net interest income after provision for loan and lease losses was $11,270,000 against $9,150,000 a year ago. Income before income taxes was $2,171,000 against $150,000 a year ago. Net income was $2,412,000 or $0.10 per basic and diluted share against $309,000 or $0.01 per basic and diluted share a year ago. Return on average assets was 0.77% against 0.11% a year ago. Return on average equity was 8.55% against 1.22% a year ago.

For the year, the company reported total interest income of $51,573,000 against $41,000,000 a year ago. Net interest income was $43,742,000 against $35,523,000 a year ago. Net interest income after provision for loan and lease losses was $43,742,000 against $15,653,000 a year ago. Income before income taxes was $10,358,000 against loss of $17,811,000 a year ago. Net income was $10,449,000 or $0.45 per basic and diluted share against loss of $34,643,000 or $1.51 per basic and diluted share a year ago. Return on average assets was 0.88% against negative return on average assets of 3.13% a year ago. Return on average equity was 9.78% against negative return on average equity of 27.56% a year ago. The increase in net income is primarily the result of an $8.2 million increase in net interest income, resulting from $118.1 million increase in gross loans for the year and an increase of $1.4 million in noninterest income as a result of an increase in service and loan related fees. Additionally, net income increased as a result of no provision for loan and lease losses in 2017 as compared to a provision of $19.9 million during 2016, resulting from an improvement in asset quality, and an income tax benefit of $91,000 for the year ended December 31, 2017 as compared to an income tax provision of $16.8 million during the same period in 2016 related to the establishment of a full valuation allowance on deferred tax asset in the prior year.

For the quarter, the company reported net charge-offs of $852,000, compared with net charge-offs of $2.1 million for the three months ended September 30, 2017.