RED BLUFF, Calif.--()--Cornerstone Community Bank, (OTCBB: CRSB), announced today its financial results for the fourth quarter and full year ended December 31, 2012.
The Bank reported net income of $325,000 for the three months ended December 31, 2012 representing an increase of $117,000, or 56%, compared to net income of $208,000 for the same period last year. Diluted earnings per share for the three months ended December 31, 2012 were $0.25 compared to $0.17 for the same period last year. Net income for the year ended December 31, 2012 was $1,211,000, or $0.95 per diluted share compared to net income of $703,000, or $0.57 per diluted share, for the year ended December 31, 2011.
The return on average assets for the three months ended December 31, 2012 was 1.19% compared to 0.95% for the same period last year. The return on average equity was 11.16% for the three months ended December 31, 2012 compared to 8.25% for the same period last year. For the year ended December 31, 2012, the return on average assets was 1.17% and the return on average equity was 11.06% compared to 0.87% and 7.34%, respectively, for the year ended December 31, 2011.
President and CEO, Jeffrey Finck stated, “We are pleased with our 2012 performance. The significant growth in loans, deposits and net income has been a direct result of the tremendous efforts made by our employees, Board of Directors and shareholders. We thank our valued customers for their business and we look forward to continuing to provide the exceptional service they have become accustomed to.”
Net Interest Income
Net interest income of $1,107,000 for the quarter ended December 31, 2012 represented an increase of $132,000, or 14%, from $975,000 for the same quarter one year earlier. The net interest margin decreased to 4.22% during the quarter ended December 31, 2012 compared to 4.64% during the same quarter last year. For the year ended December 31, 2012, net interest income was $4,347,000 compared to $3,758,000 for the year ending December 31, 2011 representing an increase of $589,000, or 16%. The net interest margin decreased to 4.42% for the year ended December 31, 2012 compared to 4.86% for the year ended December 31, 2011.
Provision for credit losses
There was no provision for credit losses for the quarter ended December 31, 2012 compared to $110,000 for the quarter ended December 31, 2011. The provision for credit losses for the year ended December 31, 2012 was $285,000 compared to $259,000 for the year ended December 31, 2011.
The Bank’s non-interest income for the quarter ended December 31, 2012 was $168,000 compared to $84,000 for the quarter ended December 31, 2011. For the year ended December 31, 2012, non-interest income was $859,000 compared to $318,000 for the same period last year. The increase in non-interest income for the year ended December 31, 2012 was primarily due to increases in mortgage loan fee income and a severance-related accrual reversal.
Non-interest expense was $974,000 for the quarter ended December 31, 2012 compared to $894,000 for the same period one year earlier. For the year ended December 31, 2012, non-interest expense was $3,806,000 compared to $3,583,000 for the same period last year, representing an increase of $223,000, or 6%.
During the quarter ended December 31, 2012, the Bank recognized an income tax benefit of $24,000 compared to $153,000 for the same period last year. These benefits were primarily due to the recognition of deferred tax assets.
The Bank had total assets at December 31, 2012 of $111.7 million, compared to $91.3 million at December 31, 2011, representing growth of $20.4 million, or 22%.
Total loans outstanding at December 31, 2012, net of unearned income, were $73.8 million compared to $64.5 million at December 31, 2011, representing an increase of $9.3 million, or 14%.
Total deposits were $99.7 million at December 31, 2012 compared to total deposits of $80.6 million at December 31, 2011, representing an increase of $19.1 million, or 24%.
The allowance for loan losses was $1,460,000, or 1.98% of loans, net of unearned income at December 31, 2012, compared to $1,270,000, or 1.97% of loans, net of unearned income at December 31, 2011. Nonperforming assets at December 31, 2012 were $392,000 compared to $185,000 at December 31, 2011.
The bank recognized $94,000 in net loan charge-offs during the year ended December 31, 2012, representing 0.14% of average loans.
At December 31, 2012, shareholders’ equity totaled $11.8 million compared to $10.2 million at December 31, 2011. At December 31, 2012, the total risk-based capital ratio, tier one capital ratio, and leverage ratio was 14.55%, 13.29% and 10.32%, respectively, all exceeding the regulatory standards for “well-capitalized” institutions of 10.00%, 6.00% and 5.00%, respectively.
About Cornerstone Community Bank
Cornerstone Community Bank is a California state-chartered bank with its headquarters office in Red Bluff and a branch office in Redding. The Bank provides commercial banking services, including a wide variety of deposit products and real estate, construction, commercial and consumer loans to small businesses, professionals and individuals. Additional information about the Bank is available on its website at www.bankcornerstone.com
This press release contains forward-looking statements. These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of the management of Cornerstone Community Bank and on information available to management at the time these statements were made. There are a number of factors, many of which are beyond Cornerstone Community Bank’s control, which could cause actual conditions, events or results to differ significantly from those described in the forward-looking statements. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, among others, the following possibilities: (1) competitive pressures among depository and other financial institutions may increase significantly; (2) revenues may be lower than expected; (3) changes in the interest rate environment may reduce interest margins; (4) general economic conditions, either nationally or regionally, may be less favorable than expected, resulting in, among other things, a deterioration in credit quality and/or a reduced demand for credit; (5) legislative or regulatory changes, including changes in accounting standards and tax laws, may adversely affect the businesses in which Cornerstone Community Bank is engaged; (6) competitors may have greater financial resources and develop products that enable such competitors to compete more successfully than Cornerstone Community Bank; and (7) adverse changes may occur in the securities markets or with respect to inflation. Forward-looking statements speak only as of the date they are made. Except as required by law, Cornerstone Community Bank does not undertake to update forward-looking statements to reflect subsequent circumstances or events.
|CORNERSTONE COMMUNITY BANK|
|CONSOLIDATED BALANCE SHEETS (UNAUDITED)|
|(Dollars in Thousands)|
|Cash and due from banks||$||3,091||$||2,389||$||3,507||$||3,542||$||1,957|
|Federal funds sold||-||-||-||-||-|
|Loans held for sale||791||573||336||379||-|
|Loans, net of unearned income||73,820||72,240||68,459||63,433||64,504|
|Allowance for loan losses||(1,460||)||(1,469||)||(1,325||)||(1,246||)||(1,270||)|
|Premises and equipment, net||1,070||1,126||1,165||1,172||1,226|
|Money market and savings||37,634||39,509||42,072||37,762||32,322|
|Time deposits of less than $100,000||8,965||9,047||8,949||7,851||8,841|
|Time deposits of $100,000 or more||15,795||14,991||14,628||15,076||14,718|
|Additional paid-in capital||801||772||741||714||685|
|Accumulated other comprehensive income (loss)||470||454||349||153||176|
|Total shareholders' equity||11,791||11,421||10,871||10,395||10,170|
|Total liabilities and shareholders' equity||$||111,692||$||106,945||$||102,825||$||97,318||$||91,347|
|Tier I leverage ratio||10.32||%||10.12||%||10.26||%||10.64||%||10.89||%|
|Tier I risk-based capital ratio||13.29||%||13.17||%||13.03||%||13.51||%||13.27||%|
|Total risk-based capital ratio||14.55||%||14.43||%||14.29||%||14.77||%||14.52||%|
|Total equity / total assets||10.56||%||10.68||%||10.57||%||10.68||%||11.13||%|
|Book value per share||$||9.83||$||9.52||$||9.06||$||8.66||$||8.48|
|CORNERSTONE COMMUNITY BANK|
|CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)|
|(Dollars in Thousands)|
|Three months ended||Year ended|
|Federal funds sold||-||-||-||-||-|
|Total interest income||1,277||1,242||1,142||5,055||4,414|
|Money market and savings||90||99||91||382||380|
|Total interest expense||170||179||167||708||656|
|Net interest income||1,107||1,063||975||4,347||3,758|
|Provision for credit losses||-||150||110||285||259|
Net interest income after provision for credit losses
|Service charges on deposit accounts||25||23||23||100||84|
|Gain on sale of SBA loans||-||-||-||-||37|
|Gain on sale of securities||-||-||-||-||37|
|Other non-interest income||143||431||61||759||160|
|Total non-interest income||168||454||84||859||318|
|Salaries and benefits||529||497||466||2,003||1,935|
|Premises and fixed assets||120||125||109||478||403|
|Total operating expenses||974||977||894||3,806||3,583|
|Income before income taxes||301||390||55||1,115||234|
|EARNINGS PER SHARE|
|Basic earnings per share||$||0.27||$||0.35||$||0.17||$||1.01||$||0.59|
|Diluted earnings per share||$||0.25||$||0.32||$||0.17||$||0.95||$||0.57|
|Average common shares outstanding||1,200,000||1,200,000||1,200,000||1,200,000||1,200,000|
Average common and equivalent shares outstanding
|Return on average assets||1.19||%||1.54||%||0.95||%||1.17||%||0.87||%|
|Return on average equity||11.16||%||14.88||%||8.25||%||11.06||%||7.34||%|
|Net interest margin||4.22||%||4.10||%||4.64||%||4.42||%||4.86||%|