OAKLAND, Calif., May 02, 2022 (GLOBE NEWSWIRE) — Bay Community Bancorp, (OTCPink: CBOBA) (the �Company), parent company of Community Bank of the Bay, (the Bank) a San Francisco Bay Area commercial bank and certified Community Development Financial Institution (CDFI) with full-service offices in Oakland, Danville and San Mateo, today reported earnings of $1.62 million for the first quarter of 2022, compared to $1.68 million for the first quarter of 2021. Strong core loan and deposit growth, together with interest and fee income from the loan forgiveness phase of the Small Business Administration’s (SBA) Paycheck Protection Program (PPP) loans, contributed to profitability for the quarter. All financial results are unaudited.
The Companys Board of Directors declared a quarterly cash dividend of $0.045 per share. The dividend is payable on June 6, 2022 to shareholders of record on May 25, 2022. This marks the fifth consecutive, and first increase in the cash dividend payment since the Company initiated quarterly cash dividends on April 30, 2021.
We reported another quarter of core loan growth and our ongoing outreach efforts to existing clients and prospects has produced a robust loan pipeline that we expect to recognize in the coming quarters, stated William S. Keller, President and CEO. Operating revenue increased during the first quarter compared to a year ago, driven by increased earning assets, lower overall cost of funds and stable DDA balances, while non-interest expenses, exclusive of last years PPP related offsets, increased 7.6% as we built capacity to support near term growth.
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. As of March 31, 2022, the Company had received payments from the SBA for forgiveness of $141.4 million for 910 PPP borrowers. At quarter end, the Company had a total of $16.9 million in gross PPP loans remaining on its books. Approximately $596,000 of the fee income recognized during the first quarter of 2022 was related to these PPP loan payoffs, compared to $829,000 of the fee income recognized during the prior quarter. At March 31, 2022, approximately $445,000 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.
Higher than typical liquidity levels, primarily due to larger deposit balances and the resulting effect on the mix of our earning assets, continued to pressure our net interest margin, said Keller. However, as PPP loan balances run off and we recognize the benefit of the March 16 rate increase enacted by the Federal Reserve, we expect to see our NIM improve in future quarters, especially with the potential for additional rate increases throughout the year. The Companys net interest margin was 3.58% in the first quarter of 2022, compared to 3.69% in the preceding quarter, and 3.74% in the first quarter a year ago. PPP loan fees and interest added 26 basis points to the net interest margin for the first quarter of 2022, compared to adding 34 basis points in the preceding quarter.
Due to rebounding economic activity, especially in industry segments that were the most affected by the pandemic, and a $220,000 recovery of a previous charge off in one of those segments, the Company did not record a provision for loan losses for the quarter ended March 31, 2022, said Mukhtar Ali, Chief Credit Officer. Our loan loss reserves represent 1.31% of total non-guaranteed loans at March 31, 2022, compared to 1.36% a year earlier. We communicate with our borrows regularly and we continue to be impressed by their capabilities and resilience. As a result we believe that we have adequate provisions in place to navigate the ongoing economic transition. The Bank had no past due loans or loans on deferral at March 31, 2022.
First Quarter 2022 Financial Highlights (at or for the period ended March 31, 2022)
On December 14, 2021 at the annual Freedmans Bank Forum in Washington, D.C. Secretary of the Treasury Janet L. Yellen and Vice President Kamala Harris announced that $8.7 billion in Emergency Capital Investments had been granted to 186 MDI and CDFI banks and credit unions to, among other things, provide loans, grants, and forbearance for small businesses, minority-owned businesses, and consumers, especially low-income and underserved communities that may have been disproportionately impacted by the economic effects of the COVID-19 pandemic.
We are proud to be one of only five banks and six credit unions in California to be approved by the US Treasury for investment under ECIP. We are currently working directly with Treasury to close their investment by June 30, 2022, at which time we will announce more details including the final investment amount, said Keller. We look forward to working with Treasury and are excited by the increased services and lending capabilities that we will be able to provide to our clients and the communities we serve as a result . Management and the board have worked diligently to prepare for this investment capital, and we are confident that any investment, whether it is preferred stock from Treasury or common stock from shareholders, will only serve to enhance our existing business model.
For additional information on the 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 Rapid Response Program please visit
https://www.cdfifund.gov/programs-training/programs/rrp
About Bay Community Bancorp
Bay Community Bancorp (OTCPink: CBOBA) is the parent company of Community Bank of the Bay, a San Francisco Bay Area commercial bank with full-service offices in Oakland, Danville and San Mateo. Community Bank of the Bay serves the financial needs of closely held businesses and professional service firms, as well as their owner-operators and non-profit organizations throughout the San Francisco Bay Area. Community Bank of the Bay is a member of the FDIC, an SBA Preferred Lender, and a CDARS depository institution, headquartered in Oakland, with full-service branches in Danville and San Mateo. It is Californias first FDIC-insured certified Community Development Financial Institution and one of only three operating in the Bay Area. The bank is recognized for establishing the Bay Area Green Fund to provide financing to sustainable businesses and projects and supports environmentally responsible values. Additional information on the bank is available online at www.BankCBB.com.
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 California and other factors beyond the Bank’s control. Such risks and uncertainties could cause results for subsequent interim periods or for the entire year to differ materially from those indicated. Readers should not place undue reliance on the forward-looking statements, which reflect management’s view only as of the date hereof. The Bank does not undertake, and specifically disclaims, any obligation to update or revise any forward-looking statements, whether to reflect new information, future events, or otherwise, except as required by law.
Contacts:
William S. Keller, President & CEO
510-433-5404
wkeller@BankCBB.com
FINANCIAL TABLES TO FOLLOW:
BAY COMMUNITY BANCORP | |||||||||||||||||||||
UNAUDITED SUMMARY FINANCIAL STATEMENTS | |||||||||||||||||||||
(Dollars in thousands, except earnings per share) | |||||||||||||||||||||
INCOME STATEMENT | Three Months Ended | ||||||||||||||||||||
2022 | 2021 | Qtr over Qtr | 2021 | Qtr over Yr Ago Qtr | |||||||||||||||||
Mar 31 | Dec 31 | % Change | Mar 31 | % Change | |||||||||||||||||
Interest income | $ | 6,900 | $ | 7,051 | -2.1 | % | $ | 6,574 | 5.0 | % | |||||||||||
Interest expense | 410 | 395 | 3.8 | % | 493 | -16.8 | % | ||||||||||||||
Net interest income before provision | 6,490 | 6,656 | -2.5 | % | 6,081 | 6.7 | % | ||||||||||||||
Provision for Loan Losses | – | 200 | -100.0 | % | 250 | -100.0 | % | ||||||||||||||
Net interest income after provision | 6,490 | 6,456 | 0.5 | % | 5,831 | 11.3 | % | ||||||||||||||
Non-interest income | 180 | 226 | -20.4 | % | 208 | -13.5 | % | ||||||||||||||
Non-interest expense | 4,361 | 4,192 | 4.0 | % | 3,665 | 19.0 | % | ||||||||||||||
Income before provision for income taxes | 2,309 | 2,490 | -7.3 | % | 2,374 | -2.7 | % | ||||||||||||||
Provision for income taxes | 683 | 736 | -7.2 | % | 691 | -1.2 | % | ||||||||||||||
Net income | $ | 1,626 | $ | 1,754 | -7.3 | % | $ | 1,683 | -3.4 | % | |||||||||||
Basic earnings per common share | $ | 0.18 | $ | 0.20 | -7.3 | % | $ | 0.19 | -4.5 | % | |||||||||||
Weighted average common shares outstanding | 8,871,052 | 8,871,052 | 8,765,089 | ||||||||||||||||||
Return on average assets | 0.87 | % | 0.94 | % | 0.97 | % | |||||||||||||||
Return on average common equity | 9.72 | % | 10.33 | % | 10.65 | % | |||||||||||||||
BAY COMMUNITY BANCORP | |||||||||||||||||||||
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 | Mar 31 | Dec 31 | % Change | Mar 31 | % Change | ||||||||||||||||
Total cash and investments | $ | 247,559 | $ | 164,326 | 50.7 | % | $ | 197,828 | 25.1 | % | |||||||||||
Loans, net of unearned income | 521,675 | 538,831 | -3.2 | % | 541,589 | -3.7 | % | ||||||||||||||
Loan loss reserve | (6,500 | ) | (6,281 | ) | 3.5 | % | (5,679 | ) | 14.5 | % | |||||||||||
Other assets | 28,823 | 18,678 | 54.3 | % | 28,336 | 1.7 | % | ||||||||||||||
Total Assets | $ | 791,557 | $ | 715,554 | 10.6 | % | $ | 762,074 | 3.9 | % | |||||||||||
LIABILITIES AND SHAREHOLDERS EQUITY | |||||||||||||||||||||
Non-interest bearing demand deposits | 241,902 | 237,541 | 1.8 | % | 255,310 | -5.3 | % | ||||||||||||||
Interest bearing deposits | 456,592 | 372,693 | 22.5 | % | 406,326 | 12.4 | % | ||||||||||||||
Total deposits | 698,494 | 610,234 | 14.5 | % | 661,636 | 5.6 | % | ||||||||||||||
Total borrowings and other liabilities | 26,021 | 37,287 | -30.2 | % | 37,216 | -30.1 | % | ||||||||||||||
Total Liabilities | $ | 724,515 | $ | 647,521 | 11.9 | % | $ | 698,852 | 3.7 | % | |||||||||||
Total equity | 67,042 | 68,033 | -1.5 | % | 63,222 | 6.0 | % | ||||||||||||||
Total Liabilities and Total Equity | $ | 791,557 | $ | 715,554 | 10.6 | % | $ | 762,074 | 3.9 | % | |||||||||||
Book value per common share | $ | 7.56 | $ | 7.67 | -1.5 | % | $ | 7.20 | 5.0 | % | |||||||||||
SELECTED FINANCIAL DATA | |||||||||||||
(In thousands of dollars, except for ratios and per share amounts) | |||||||||||||
Unaudited | |||||||||||||
At or for the Three Months Ended | |||||||||||||
2022 | 2021 | 2021 | |||||||||||
Mar 31 | Dec 31 | Mar 31 | |||||||||||
ASSET QUALITY RATIOS | |||||||||||||
Net (charge-offs) recoveries | $ | 220 | $ | – | $ | (268 | ) | ||||||
Net (charge-offs) recoveries to average loans | 0.042 | % | 0.000 | % | -0.051 | % | |||||||
Non-performing loans as a % of loans | 0.004 | % | 0.005 | % | 0.021 | % | |||||||
Non-performing assets as a % of assets | 0.003 | % | 0.003 | % | 0.015 | % | |||||||
Allowance for loan losses as a % of total loans | 1.25 | % | 1.17 | % | 1.05 | % | |||||||
Allowance for loan losses as a % of total unguaranteed loans | 1.31 | % | 1.28 | % | 1.36 | % | |||||||
Allowance for loan losses as a % of non-performing loans | 28966 | % | 23402 | % | 5069 | % | |||||||
AVERAGE BALANCE SHEET DATA | |||||||||||||
Average assets | $ | 759,409 | $ | 741,266 | $ | 685,225 | |||||||
Average total loans | $ | 525,647 | $ | 521,103 | $ | 522,595 | |||||||
Average total deposits | $ | 660,149 | $ | 644,639 | $ | 581,577 | |||||||
Average shareholders’ equity | $ | 67,820 | $ | 67,395 | $ | 62,704 | |||||||
FINANCIAL RATIOSSTATISTICS | |||||||||||||
Return on average assets | 0.87 | % | 0.94 | % | 0.97 | % | |||||||
Return on average equity | 9.72 | % | 10.33 | % | 10.65 | % | |||||||
Net interest margin | 3.58 | % | 3.69 | % | 3.74 | % | |||||||
Efficiency ratio | 65.38 | % | 60.91 | % | 58.28 | % | |||||||
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