Pacific City Financial Corporation Reports Strong 2015 Third Quarter Financial Results

LOS ANGELES--()--Pacific City Financial Corporation (the “Company”) (OTC Pink: PFCF), the holding company of Pacific City Bank, today reported net income available to common shareholders of $3.2 million, or $0.32 per diluted common share, for the third quarter of 2015. The 2015 third quarter net income of $3.2 million was in line with 2015 second quarter net income, but declined $422,000 compared with the 2014 third quarter net income of $3.6 million. Year-to-date net income totaled $9.3 million, or $0.94 per diluted common share, for the nine month period in 2015 compared to $9.1 million, or $0.97 per diluted common share, for the same period in 2014.

2015 Third Quarter Highlights

  • Net income available to common shareholders totaled $3.2 million, or $0.32 per diluted common share
  • Total assets increased $174.1 million, or 20.4%, to $1,028.9 million from $854.8 million at September 30, 2014
  • Gross loans, net of unearned fee/cost, increased $92.7 million, or 13.0%, to $808.3 million from $715.6 million at September 30, 2014
  • Total deposits increased $161.9 million, or 21.1%, to $928.4 million from $766.5 million at September 30, 2014
  • Classified assets to tier 1 and ALLL ratio improved to 6.2% from 12.95% at September 30, 2014
  • Opened first out of state full service branch in Fort Lee, New Jersey

"We are pleased to report another strong quarterly financial performance coupled with the opening of our first out of state full service branch in Fort Lee, New Jersey. Our assets exceeded $1.0 billion with an increase of our deposits to a record high of $928 million or 3% from June 30, 2015 and an increase of loans to $808 million or 2%,” stated Haeyoung Cho, President CEO. “We are very excited with the opening of our Fort Lee branch where we see an expanding market.”

2015 Third Quarter Financial Highlights  
(dollars in thousands, except per share data)
           
At or for the Three Months Ended
Sept. 30,

2015

Jun. 30,

2015

%

change

Sept. 30,

2014

%

change

 
Net income $ 3,186 $ 3,169 0.5 % $ 3,664 -13.0 %
Net income available to common shareholders $ 3,186 $ 3,169 0.5 % $ 3,608 -11.7 %
Earnings per common share (basic) $ 0.33 $ 0.32 3.1 % $ 0.38 -13.2 %
 
Net interest income $ 9,392 $ 9,259 1.4 % $ 8,257 13.7 %
Provision (Reversal) for loan loss $ 95 $ 169 -43.8 % $ (672 ) -114.1 %
Non-interest income $ 3,134 $ 3,572 -12.3 % $ 4,160 -24.7 %
Non-interest expense $ 6,836 $ 7,170 -4.7 % $ 6,331 8.0 %
 
Total assets $ 1,028,887 $ 998,136 3.1 % $ 854,769 20.4 %
Loans receivable, net of allowance and loan fee/cost $ 799,105 $ 783,534 2.0 % $ 705,653 13.2 %
Total deposits $ 928,429 $ 901,035 3.0 % $ 766,523 21.1 %
 
Return on average assets 1.24 % 1.35 % 1.75 %
Return on average stockholders' equity 13.37 % 13.87 % 17.99 %
Net interest margin 3.73 % 3.96 % 4.05 %
Efficiency ratio 54.58 % 55.88 % 50.99 %
Tangible common equity to tangible assets 9.30 % 9.27 % 9.80 % *
Tangible common equity per common share $ 9.77 $ 9.45 $ 8.58 *
 
Tier 1 leverage ratio (consolidated) 9.35 % 9.73 % 10.14 %
 
* 10% stock dividend paid on March 20, 2015 reflected retroactively.

OPERATING RESULTS FOR THE 2015 THIRD QUARTER

Net Income Summary

Net income available to common shareholders in the third quarter of 2015 remained at $3.2 million compared with the second quarter of 2015, but declined 11.7%, or $422,000, from the year-ago quarter. The decrease from the year-ago quarter was primarily due to a decrease of $1.0 million in noninterest income, an increase of $505,000 in noninterest expense, and a loan loss provision of $95,000 compared with a reversal of loan loss provision expense of $672,000, partially offset by an increase of $1.1 million in net interest income and a decrease of $685,000 in income tax provision.

Net Interest Income and Net Interest Margin

Net interest income before provision for loan losses in the third quarter of 2015 increased $133,000, or 1.4%, to $9.4 million compared with the previous quarter, and increased $1.1 million, or 13.7%, compared with the year-ago quarter. The increase was primarily due to the overall growth in loan balance partially offset by a decline in loan yield.

The average loan balance was $813.6 million in the third quarter of 2015 compared with $795.2 million in the second quarter of 2015, and $692.6 million in the third quarter of 2014. The Bank originated $110.2 million in new loans during the third quarter of 2015 compared with $118.7 million for the second quarter of 2015, and $149.0 million for the third quarter of 2014.

The loan yield for the third quarter of 2015 declined 3bps to 5.12% compared with 5.15% for the second quarter of 2015, and declined 12 bps compared with 5.24% for the third quarter of 2014. The decline in loan yield for third quarter of 2015 compared with the third quarter of 2014 was primarily due to the bank’s ongoing strategy to book proportionally more variable loans that generally yields lower than fixed rate loans at funding to reduce the interest rate risk associated with a rising interest rate environment.

Below is a table of fixed and variable interest rate loans accompanied with weighted average contractual rates:

                     
September 30, 2015 June 30, 2015 September 30, 2014
% to Gross

Loans *

WAVG

Contractual Rate

% to Gross

Loans *

WAVG

Contractual Rate

% to Gross

Loans *

WAVG

Contractual Rate

Fixed rate loans 40.4 % 5.12 % 43.1 % 5.12 % 48.5 % 5.12 %
Variable rate loans 59.6 % 4.32 % 56.9 % 4.34 % 51.5 % 4.55 %
* Including LHFS

Net interest margin decreased 23 bps to 3.73% in the third quarter of 2015 compared with 3.96% in the previous quarter, and decreased 32 bps compared with 4.05% in the year-ago quarter primarily due to the aforementioned decline in loan yields and an increase in average interest-bearing Federal Reserve Bank balance which yields lower than other interest earning assets. The average interest-bearing Federal Reserve Bank balance essentially doubled to $89.0 million in the third quarter of 2015 compared with $46.4 million in the second quarter of 2015, and $40.5 million in the third quarter of 2014.

Total interest expenses for the third quarter of 2015 increased $149,000, or 10.0%, to $1.6 million compared with $1.5 million in the second quarter of 2015, and increased $354,000, 27.5%, compared with $1.3 million for the year-ago quarter primarily due to an increase in average interest bearing deposit balance. The cost of interest-bearing deposits remained at 0.94% for the third compared with the second quarter of 2015, and increased 2 bps compared with the third quarter of 2014.

The cost of total deposit including non-interest bearing deposits was 0.71% for the third quarter of 2015 compared with 0.70% for the second quarter of 2015, and 0.68% for the third quarter of 2014.

Non-interest Income

Non-interest income for the third quarter of 2015 decreased $438,000, or 12.3%, to $3.1 million compared with $3.6 million in the 2015 second quarter, and decreased $1.0 million, or 24.7%, compared with $4.2 million in the year-ago quarter. The decrease was primarily due to a decrease on gain on sale of SBA loans and residential mortgage loan. The gain on sale of SBA and residential mortgage loans were $1.9 million in the third quarter of 2015, $2.5 million in the second quarter 2015, and $3.0 million in the third quarter of 2014.

The Company sold $25.5 million of guaranteed portion of SBA loans in the third quarter of 2015 compared with $25.8 million in the second quarter of 2015, and $37.6 million in the third quarter of 2014. The Company also sold $13.6 million in residential mortgage loans in the third quarter of 2015 compared with $20.0 million in the second quarter of 2015, and $2.9 million for the third quarter of 2014.

Non-interest Expenses

Non-interest expenses for the third quarter of 2015 declined $334,000, or 4.7%, to $6.8 million compared with $7.2 million in the previous quarter, and increased $505,000, or 8.0%, compared with the year-ago quarter. The decrease compared with the previous quarter was primarily due to a decrease in employee salary and benefits expenses and a decrease in marketing expenses. The increase compared with the year-ago quarter was primarily due to an increase in the salary and benefits expenses stemming from an increase in headcount in conjunction with asset growth.

Income Tax Provision

The Company’s effective income tax rate was 43.06% for the third quarter of 2015 compared with 42.3% for the second quarter of 2015, and 45.8% for the third quarter of 2014. Year-to date effective income tax rate for the nine months ended September 30, 2015 was 42.25% compared with 42.07% for the nine months ended September 30, 2014.

BALANCE SHEET SUMMARY

Total Assets

Total assets at September 30, 2015 increased $30.8 million, or 3.1%, to $1,028.9 million compared with $998.1 million at June 30, 2015, and increased $174.1 million, or 20.4%, compared with $854.8 million at September 30, 2014.

Loans

Gross loan receivable, net of deferred costs and fees, increased $15.5 million, or 2.0%, to $808.3 million at September 30, 2015 compared with $792.8 million at June 30, 2015, and increased $92.7 million, or 13.0%, compared with $715.6 million at September 30, 2014.

The following table is a list of gross loan balance by type excluding unearned loan fees and allowance for loan losses:

Loan type (in thousands)                  
  Sept. 30,

2015

Jun. 31,

2015

Percentage

Change

Sept. 30,

2014

Percentage

Change

Real estate loans $ 467,656 $ 462,103 1.2 % $ 403,154 16.0 %
Residential mortgage loans 121,777 119,607 1.8 % 115,278 5.6 %
SBA loans 107,678 103,226 4.3 % 92,771 16.1 %
Commercial industrial loans 82,452 79,436 3.8 % 73,046 12.9 %
Consumer loans   28,601   28,250 1.2 %   31,104 -8.0 %
Gross loans receivables 808,164 792,622 2.0 % 715,353 13.0 %
Held for sale loans   3,170   5,186 -38.9 %   5,717 -44.6 %
Total gross loans $ 811,334 $ 797,808 1.7 % $ 721,070 12.5 %

Investment Securities

Total investment securities portfolio balance at September 30, 2015 increased $11.1 million, or 13.8%, to $91.7 million compared with $80.6 million at June 30, 2015, and increased $24.3 million, or 36.0%, compared with $67.4 million at September 30, 2014. The increase compared with the previous quarter was primarily due to purchases of $14.3 million in investment securities during the third quarter 2015, partially offset by principal pay-down of $3.4 million.

Deposits

Total deposit balance increased $27.4 million, or 3.0%, to $928.4 million at September 30, 2015 compared with $901.0 million at June 30, 2015, and increased $161.9 million, or 21.1%, compared with $766.5 million at September 30, 2014. The ratio of demand deposits to total deposits was 25.3% at September 30, 2015 compared with 25.1% at June 30, 2015, and 26.1% at September 30, 2014.

The following is a deposit mix table by period:

Deposit mix (in thousands)                    
      September 30, 2015 June 30, 2015 September 30, 2014
Amount Percentage Amount Percentage Amount Percentage
Demand deposits $ 234,527 25.3 % $ 226,172 25.5 % $ 199,872 26.1 %
Now accounts 9,652 1.0 % 11,202 0.9 % 8,091 1.1 %
Money market accounts 222,715 24.0 % 192,862 21.7 % 146,825 19.2 %
Savings 7,323 0.8 % 7,191 0.8 % 6,722 0.9 %
Time deposits under $250K 245,356 26.4 % 253,410 12.2 % 209,171 27.3 %
Time deposits of $250K and over 112,855 12.2 % 111,196 28.0 % 98,761 12.9 %
State & Broker CDs   96,001 10.3 %   99,001 10.9 %   97,081 12.7 %
Total deposits $ 928,429 100.0 % $ 901,034 100.0 % $ 766,523 100.0 %

CREDIT QUALITY

Loan Loss Provision

The provision for loan losses in the third quarter of 2015 was $95,000 compared with $169,000 in the previous quarter, and a reversal of $672,000 in the year-ago quarter. During the third quarter of 2015, the Company recognized a net charged-off of $154,000 in loans compared with a net charged-off of $292,000 in the second quarter of 2015, and a net recovery of $101,000 in the third quarter of 2014. Annualized net charge-off ratio in the third quarter of 2015 was 0.08% compared with 0.15% in the previous quarter, and a negative 0.06% in the year-ago quarter.

The allowance for loan losses to total gross loans ratio was 1.14% at September 30, 2015 compared with 1.17% at June 30, 2015, and 1.39% at September 30, 2014.

Non-performing Assets

Non-performing loans (“NPL”) balance remained at $2.8 million at September 30, 2015 compared with June 30, 2015, and declined $526,000 compared with $3.3 million at September 30, 2014. Non-performing loans to gross loans ratios of 0.35% at September 30, 2015 did not change from June 30, 2015, and the ratio was 0.46% at September 30, 2014.

OREO balance at September 30, 2015 and June 30, 2015 was zero compared with $549,000 at September 30, 2014.

The following tables summarize composition of non-performing loans and non-performing assets:

Non-performing loans composition (Dollars in thousands)        
       
Sept. 30,

2015

Jun. 30,

2015

Percentage

Change

Sept. 30,

2014

Percentage

Change

Real estate loans $ 83 $ 87 -4.6 % $ 101 -17.8 %
Commercial and industrial loans 1,023 858 19.2 % 1,008 1.5 %
SBA loans 1,620 1,791 -9.5 % 2,095 -22.7 %
Consumer loans & others   69   66 4.5 %   117 -41.0 %
$ 2,795 $ 2,802 -0.2 % $ 3,321 -15.8 %
Non-performing assets (Dollars in thousands)
                       
Sept. 30,

2015

Jun. 30,

2015

%

Change

  Sept. 30,

2014

%

Change

 
Non-performing loans (NPL) $ 2,795 $ 2,802 -0.2 % $ 3,321 -15.8 %
Non-performing TDR (included in NPL) $ 1,995 $ 1,816 9.9 % $ 2,566 -22.3 %
Gross loans including deferred loan fees/cost $ 808,304 $ 792,792 2.0 % $ 715,578 13.0 %
NPL/Gross loans 0.35 % 0.35 % 0.46 %
OREO $ - $ - - $ 549 -100.0 %
Performing TDR $ 2,951 $ 3,186 -7.4 % $ 7,460 -60.4 %
NPA (NPL+OREO) $ 2,795 $ 2,802 -0.2 % $ 3,870 -27.8 %
Total assets $ 1,028,887 $ 998,136 3.1 % $ 854,769 20.4 %
 
NPA (NPL+OREO)/Gross loans 0.35 % 0.35 % 0.54 %
NPA (NPL+OREO)/Total assets 0.27 % 0.28 % 0.45 %

Classified Assets

Classified loans at September 30, 2015 decreased $465,000 to $6.4 million compared with $6.9 million at June 30, 2015, and decreased $5.2 million compared with $11.6 million at September 30, 2014.

Classified assets to total assets ratio decreased 7 bps to 0.62% at September 30, 2015 compared with 0.69% at June 30, 2015, and decreased 80 bps compared with 1.43% at September 30, 2014.

The following tables provide some detail on classified loans and classified assets.

Classified loans (Dollars in thousands)                
 
    Sept. 30

2015

Jun. 30,

2015

Percentage

Change

Sept. 30,

2014

Percentage

Change

Substandard (Classified) $ 6,423 $ 6,888 -6.8 % $ 11,641 -44.8 %
Special mention   6,196   4,281 44.7 %   2,066 199.9 %
Total criticized 12,619 11,169 13.0 % 13,707 -7.9 %
 
Watch   22,504   31,987 -29.6 %   22,052 2.0 %
Total problem loans $ 35,123 $ 43,156 -18.6 % $ 35,759 -1.8 %
Classified assets (Dollars in thousands)
             
Sept. 30,

2015

Jun. 30,

2015

%

Change

  Sept. 30,

2014

%

Change

 
Classified assets $ 6,423 $ 6,888 -6.8 % $ 12,190 -47.3 %
Classified loans/Gross loans 0.79 % 0.87 % 1.63 %
Classified loans + Mention/Gross loans 1.56 % 1.41 % 1.92 %
Classified loans + Mention+Watch/Gross loans 4.35 % 5.44 % 5.00 %
Tier 1 + ALLL $ 104,376 $ 101,746 2.6 % $ 94,158 10.9 %
Classified loans/Tier 1 + ALLL 6.15 % 6.77 % 12.36 %
Classified assets/Tier 1 + ALLL 6.15 % 6.77 % 12.95 %
Classified assets/Total assets 0.62 % 0.69 % 1.43 %

Capital

The following table illustrates Pacific City Bank capital ratios:

Capital Ratios            
 
September 30, 2015 June 30, 2015 September 30, 2014  
Tier 1 Leverage Capital Ratio (Bank) 9.17 % 9.50 % 9.83 %
Common Equity Tier 1 Capital Ratio (Bank) 12.18 % 11.92 %

NA

Tier 1 Risk-Based Capital Ratio (Bank) 12.18 %

11.92

% 12.10 %
Total Risk-Based Capital Ratio (Bank) 13.39 % 13.16 % 13.35 %

About Pacific City Financial Corporation

Headquartered in Los Angeles, California, Pacific City Financial Corporation is the parent company of Pacific City Bank, a full-service commercial bank with nine branch offices and six loan production offices in Lynwood and Bellevue, Washington; Chicago, Illinois; Annandale, Virginia; Atlanta, Georgia; and Orange County, California. Pacific City Bank specializes in commercial banking for small to medium-size businesses by providing commercial real estate loans, small business loans and lines of credit, trade finance loans, auto loans, residential mortgage loans, and SBA loans. Pacific City Bank serves a diverse customer base through its branches in the Greater Los Angeles Area and New Jersey and its Loan Production Offices in five States.

Safe Harbor Statement

This press release may contain forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from the projected, including descriptions of plans or objectives of its management for future operations, products or services, and forecasts of its revenues, earnings or other measures of economic performance. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.”

Pacific City Financial Corporation
Consolidated Balance Sheets (Unaudited)
(Dollars In thousands)
                   
September 30,

2015

June 30,

2015

%

change

  September 30,

2014

%

change

 
Assets
Cash and due from banks $ 12,987 $ 14,862 -12.6 % $ 13,132 -1.1 %
Interest-bearing deposits in financial institutions   96,881     88,757   9.2 %   38,671   150.5 %
Total cash and cash equivalents   109,868     103,619   6.0 %   51,803   112.1 %
 
Investment securities, available-for-sale 74,113 64,496 14.9 % 56,687 30.7 %
Investment securities, held-to-maturity   17,603     16,093   9.4 %   10,756   63.7 %
Total investment securities   91,716     80,589   13.8 %   67,443   36.0 %
 
Loans held for sale 3,170 5,186 -38.9 % 5,717 -44.6 %
 
Loans receivable, net of deferred loan costs (fees) 808,304 792,792 2.0 % 715,578 13.0 %
Less: allowance for loan losses   (9,199 )   (9,258 ) -0.6 %   (9,925 ) -7.3 %
Net loans receivables   799,105     783,534   2.0 %   705,653   13.2 %
 
Premises and equipment, net 2,235 1,914 16.8 % 2,071 7.9 %
Other real estate owned, net - - NA 549 NA
Federal Home Loan Bank and other bank stock 4,922 4,922 0.0 % 4,036 22.0 %
Deferred tax assets, net 4,900 5,661 -13.4 % 4,894 0.1 %
Servicing assets 7,188 7,113 1.1 % 6,640 8.3 %
Accrued interest receivables 2,299 2,196 4.7 % 2,020 13.8 %
Others   3,484     3,402   2.4 %   3,943   -11.6 %
Total assets $ 1,028,887   $ 998,136   3.1 % $ 854,769  

 

20.4 %
 
Liabilities
Deposits
Noninterest-bearing demand $ 234,527 $ 226,172 3.7 % $ 199,872 17.3 %
Savings, NOW, and money market accounts 239,690 211,256 13.5 % 161,638 48.3 %
Time deposits under $250,000 274,557 285,611 -3.9 % 246,252 11.5 %
Time deposits of $250,000 and over   179,655     177,996   0.9 %   158,761   13.2 %
Total deposits   928,429     901,035   3.0 %   766,523   21.1 %
Borrowings - - - - -
Accrued interest payable 1,177 1,036 13.6 % 1,050 12.1 %
Other liabilities   3,608     3,577   0.9 %   3,426   5.3 %
Total liabilities $ 933,214   $ 905,648   3.0 % $ 770,999   21.0 %
 
Capital
Common stock 84,587 84,476 0.1 % 74,669 13.3 %
Additional paid in capital 2,353 2,400 -2.0 % 2,406 -2.2 %
Retained earnings 8,695 5,803 49.8 % 7,157 0.21
Other comprehensive (loss) income   38     (191 ) -119.7 %   (462 ) -108.1 %
Total capital   95,673     92,488   3.4 %   83,770   14.2 %
 
Total liabilities & capital $ 1,028,887   $ 998,136   3.1 % $ 854,769   20.4 %
Pacific City Financial Corporation
Consolidated Income Statements (Unaudited)
(Dollars in thousands, except share and per share data)
               
Three Months Ended
September 30,

2015

June 30,

2015

Percentage

Change

September 30,

2014

Percentage

Change

Interest income
Interest and fees on loans $ 10,501 $ 10,204 2.9 % $ 9,144 14.8 %
Interest on investments 361 296 22.0 % 301 19.9 %
Interest on others   170   250 -32.0 %   98   73.6 %
Total interest income   11,032   10,750 2.6 %   9,543   15.6 %
 
Interest expense
Interest on deposits 1,640 1,491 10.0 % 1,272 28.9 %
Interest on borrowings   -   - -     14   -100.0 %
Total interest expenses   1,640   1,491 10.0 %   1,286   27.5 %
 
Net interest income 9,392 9,259 1.4 % 8,257 13.7 %
 
Provision (Reversal) for loan losses 95 169 -43.8 % (672 ) -114.1 %
 
Net interest income after PLL   9,297   9,090 2.3 %   8,929   4.1 %
 
Non-interest income
Gain on sale of SBA loans 1,669 2,086 -20.0 % 3,031 -44.9 %
Gain on sale of residential mortgage loans 264 400 -34.1 % 2 13083.5 %
Service charges on deposits 365 386 -5.5 % 362 0.8 %
Loan servicing fees 516 467 10.6 % 459 12.5 %
Other   320   233 37.1 %   306   4.4 %
Total non-interest income   3,134   3,572 -12.3 %   4,160   -24.7 %
 
Non-interest expense
Employee salaries & benefits 4,164 4,387 -5.1 % 3,773 10.4 %
Occupancies and fixed assets 932 876 6.4 % 841 10.8 %
Legal & professional 531 592 -10.3 % 504 5.4 %
FDIC assessment 120 126 -4.8 % 86 39.9 %
Marketing expenses 195 286 -31.8 % 246 -20.6 %
Data and item processing expenses 215 218 -1.4 % 195 10.2 %
Loan related expenses 101 165 -38.8 % 179 -43.7 %
Others   578   520 11.2 %   507   14.0 %
Total non-interest expenses   6,836   7,170 -4.7 %   6,331   8.0 %
 
Net income before taxes 5,595 5,492 1.9 % 6,758 -17.2 %
 
Income tax provision   2,409   2,323 3.7 %   3,094   -22.1 %
 
Net income $ 3,186 $ 3,169 0.5 % $ 3,664   -13.0 %
 
Dividend, accretion of disc, & interest on dividend   -   - -     (56 ) -100.0 %
 
Net income available for common shareholders $ 3,186 $ 3,169 0.5 % $ 3,608   -11.7 %
 
Earnings (loss) per common shares
 
Basic $ 0.33 $ 0.32 3.1 % $ 0.38 -13.2 %
Diluted $ 0.32 $ 0.32 -0.4 % $ 0.38 -15.8 %
 
Average shares outstanding
 
Basic 9,788,314 9,782,198 9,400,121
Diluted 9,872,360 9,859,855 9,447,645
Pacific City Financial Corporation
Consolidated Income Statements (Unaudited)
(Dollars in thousands, except share and per share data)
           
Nine Months Ended
September 30, 2015 September 30, 2014 Percentage Change
Interest income
Interest and fees on loans $ 30,331 $ 25,927 17.0 %
Interest on investments 945 909 3.9 %
Interest on others   521     245   112.6 %
Total interest income   31,797     27,081   17.4 %
 
Interest expense
Interest on deposits 4,613 3,627 27.2 %
Interest on borrowings   -     40   -100.0 %
Total interest expenses   4,613     3,667   25.8 %
 
Net interest income 27,184 23,414 16.1 %
 
(Reversal) Provision for loan losses (20 ) (1,772 ) -98.9 %
 
Net interest income after PLL   27,204     25,186   8.0 %
 
Non-interest income
Gain on sale of SBA loans 5,270 6,283 -16.1 %
Gain on sale of residential mortgage loans 964 275 250.5 %
Service charges on deposits 1,109 973 14.0 %
Loan servicing fees 1,541 1,305 18.1 %
Net gain on OREO - 33 -100.0 %
Other   757     635   19.2 %
Total non-interest income   9,641     9,504   1.4 %
 
Non-interest expense
Employee salaries & benefits 12,567 11,100 13.2 %
Occupancies and fixed assets 2,656 2,405 10.4 %
Legal & professional 1,805 1,304 38.4 %
FDIC assessment 367 300 22.4 %
Marketing expenses 755 699 8.1 %
Data and item processing expenses 652 582 12.0 %
Loan related expenses 400 493 -18.9 %
Others   1,571     1,474   6.6 %
Total non-interest expenses   20,773     18,357   13.2 %
 
Net income before taxes 16,072 16,333 -1.6 %
 
Income tax provision   6,790     6,872   -1.2 %
 
Net income $ 9,282   $ 9,461   -1.9 %
 
Dividend, accretion of disc, & interest on dividend   -     (336 ) -100.0 %
 
Net income available for common shareholders $ 9,282   $ 9,125   1.7 %
 
Earnings (loss) per common shares
 
Basic $ 0.95 $ 0.98 -2.9 %
Diluted $ 0.94 $ 0.97 -3.2 %
 
Average shares outstanding
 
Basic 9,780,549 9,336,074
Diluted 9,853,161 9,375,972
Pacific City Financial Corporation
Average Balance, Average Yield, and Average Rate
(Dollars in thousands)
             
Three Months Ended
September 30, 2015 June 30, 2015 September 30, 2014
Average

Balance

Interest

Income/

Expense

Average

Yield/

Rate

Average

Balance

Interest

Income/

Expense

Average

Yield/

Rate

Average

Balance

Interest

Income/

Expense

Average

Yield/

Rate

Assets
Interest-earning assets:
Gross loans, net of deferred loan fees $ 813,578 $ 10,500 5.12 % $ 795,161 $ 10,204 5.15 % $ 692,613 $ 9,145 5.24 %
US government agencies 13,975 71 2.04 % 9,081 34 1.48 % 3,614 18 2.05 %
Mortgage backed securities 42,021 184 1.75 % 37,202 167 1.80 % 37,619 177 1.88 %
Collateralized mortgage obligation 22,552 82 1.46 % 21,992 81 1.47 % 26,579 102 1.54 %
Muni bonds 5,741 24 1.66 % 3,784 14 1.51 % 245 2 3.27 %
Interest bearing deposit & others   89,941     57 0.25 %   47,522     30 0.25 %   41,587     26 0.25 %
Total interest-earning assets $ 987,808   $ 10,918 4.39 % $ 914,742   $ 10,530 4.62 % $ 802,257   $ 9,470 4.68 %
Noninterest-earning assets:
Cash and cash equivalents $ 13,973 $ 14,919 $ 14,120
Allowances for loan losses (9,279 ) (9,663 ) (10,861 )
Other assets   25,048     25,024     24,330  
$ 29,742   $ 30,280   $ 27,589  
 
Total assets $ 1,017,550   $ 945,022   $ 829,846  
 
Liabilities and Stockholders' Equity
Interest-bearing liabilities:
Deposits:
Money market & NOW accounts $ 224,565 $ 488 0.86 % $ 192,014 $ 405 0.85 % $ 151,315 $ 305 0.80 %
Savings 6,994 5 0.30 % 6,978 5 0.29 % 6,897 5 0.29 %
Time deposits   457,533     1,146 0.99 %   435,930     1,082 1.00 %   393,050     962 0.97 %
$ 689,092   $ 1,639 0.94 % $ 634,922   $ 1,492 0.94 % $ 551,262   $ 1,272 0.92 %
Borrowings:
Other borrowings: - - NA 212 0 0.00 % - - NA
Subordinated debentures   -     - NA   -     - NA   844     13 6.32 %
$ -   $ - NA $ 212   $ 0 0.00 % $ 844   $ 13 6.32 %
 
Total interest-bearing liabilities $ 689,092   $ 1,639 0.94 % $ 635,134   $ 1,492 0.94 % $ 552,106     1,285 0.92 %
Noninterest-bearing liabilities:
Demand deposits $ 229,390 $ 214,262 $ 192,546
Other liabilities   4,552     4,003     4,373  
$ 233,942   $ 218,265   $ 196,919  
 
Total liabilities $ 923,034   $ 853,399   $ 749,025  
 
Stockholders' equity $ 94,516   $ 91,623   $ 80,821  
 
Total liabilities and stockholders' equity $ 1,017,550   $ 945,022   $ 829,846  
 
Net interest income $ 9,279 $ 9,038 $ 8,185
 
Cost of funds 0.71 % 0.70 % 0.68 %
 
Net interest spread 3.44 % 3.68 % 3.76 %
 
Net interest margin 3.73 % 3.96 % 4.05 %
Pacific City Financial Corporation
Average Balance, Average Yield, and Average Rate
(Dollars in thousands)
                 
Nine Months Ended
September 30, 2015 September 30, 2014
Average

Balance

Interest

Income/

Expense

Average

Yield/

Rate

Average

Balance

Interest

Income/

Expense

Average

Yield/

Rate

Assets
Interest-earning assets:
Gross loans, net of deferred loan fees $ 791,484 $ 30,331 5.12 % $ 654,236 $ 25,927 5.30 %

 

 

US government agencies 10,078 123 1.63 % 3,428 51 1.99 %

 

 

Mortgage backed securities 38,389 536 1.86 % 36,532 525 1.92 %
Collateralized mortgage obligation 21,738 242 1.48 % 27,851 325 1.56 %
Muni bonds 3,573 44 1.65 % 246 7 3.66 %
Interest bearing deposit & others   60,548     114 0.25 %   36,118     67 0.25 %
Total interest-earning assets $ 925,810   $ 31,390 4.53 % $ 758,411   $ 26,902 4.74 %
Noninterest-earning assets:
Cash and cash equivalents $ 14,374 $ 15,586
Allowances for loan losses (9,515 ) (11,676 )
Other assets   24,432     24,232  
$ 29,291   $ 28,142  
 
Total assets $ 955,101   $ 786,553  
 
Liabilities and Stockholders' Equity
Interest-bearing liabilities:
Deposits:
Money market & NOW accounts $ 200,600 $ 1,278 0.85 % $ 141,789 $ 832 0.78 %
Savings 6,795 15 0.30 % 6,840 15 0.29 %
Time deposits   437,696     3,320 1.01 %   378,011     2,779 0.98 %
$ 645,091   $ 4,613 0.96 % $ 526,640   $ 3,626 0.92 %
Borrowings:
Other borrowings 71 0 0.17 % 1 0 0.00 %
Subordinated debentures   -     - -     850     40 6.29 %
$ 71   $ 0 0.17 % $ 851   $ 40 6.29 %
 
Total interest-bearing liabilities $ 645,162   $ 4,613 0.96 % $ 527,491   $ 3,666 0.93 %
Noninterest-bearing liabilities:
Demand deposits $ 213,872 $ 176,828
Other liabilities   4,556     3,333  
$ 218,428   $ 180,161  
 
Total liabilities $ 863,590   $ 707,652  
 
Stockholders' equity $ 91,512   $ 78,901  
 
Total liabilities and stockholders' equity $ 955,101   $ 786,553  
 
Net interest income $ 26,777 $ 23,236
 
Cost of funds 0.72 % 0.70 %
 
Net interest spread 3.58 % 3.81 %
 
Net interest margin 3.87 % 4.10 %

Contacts

Pacific City Financial Corporation
Timothy Chang
Senior Vice President & Chief Financial Officer
213-210-2000

Contacts

Pacific City Financial Corporation
Timothy Chang
Senior Vice President & Chief Financial Officer
213-210-2000