People’s Bank Year-to-Date Earnings Increase 13%

MEDFORD, Ore.--()--People’s Bank of Commerce (OTCBB: PBCO) announced today its financial results for the second quarter and year-to-date 2019. The bank reported net income of $933,000 or $0.30 per basic and diluted share for the second quarter of 2019, compared to net income of $845,000 or $0.28 per share in the same quarter of 2018. Earnings for the first six months of 2019 totaled $1,772,000 or $0.58 per share compared to $1,569,000 or $0.54 per share during the first half of 2018. Earnings per diluted share for the trailing 12 months ending June 30, 2019 were $1.21 per share compared to $0.94 one year earlier, a 29% increase.

Balance Sheet June 30, 2019 versus June 30, 2018:

  • Total Loans increased 12%
  • Total Deposits increased 8%
  • Total Assets increased 9%
  • Total Equity increased 14%
  • Year to Date return on Assets as of June 30, 2019 was 1.04%
  • Year to Date return on Equity as of June 30, 2019 was 9.70%

Income Statement year-to-date June 30, 2019 versus June 30, 2018:

  • Net-interest Income before the provision for losses increased 18%
  • Pre-tax income increased 14%
  • Non-interest Income decreased 5%
  • Non-interest Expense increased 10%

President’s Comments

“Total loans and deposits continued to grow through the first half of 2019, at 9.51% and 3% respectively,” stated Ken Trautman, bank President and CEO. “The bank retooled our residential mortgage lending division in 2019 and saw a 41% increase in mortgage lending income in the first six months of 2019 versus the same period last year. Residential mortgage opportunities are expected to continue throughout the balance of this year based on the recent reduction in home loan rates.”

Provision for Credit Losses

Mr. Trautman continued, “Credit quality remains strong with no loans past due over 90 days or on non-accrual at the end of June 2019 and June 2018. At the end of the second quarter 2019, the loan loss reserve was 1.12% of loans held for investment compared to 1.13% at the end of the second quarter 2018.”

Non-Interest Income

For the quarter ending June 30, 2019, non-interest income was $1.7 million compared to $1.8 million in the same quarter one year earlier. For the first half of 2019, non-interest income was slightly lower than the previous year with $3.2 million compared to $3.4 million year-to-date in 2018. The bank’s Steelhead Finance Division generated $2.1 million in non-interest income during the first half of 2019, compared to $2.4 million in the same period the prior year.

Non-Interest Expense

For the quarter ending June 30, 2019, non-interest expense was $3.8 million compared to $3.6 million in 2018. Year-to-date non-interest expense totaled $7.6 million through June 30, 2019, compared to $6.9 million in the same period the prior year. Mr. Trautman explained, “The most significant items impacting non-interest expense during 2019 was the salary expense associated with the addition of a four person lending team in the Medford market and one time data processing fees incurred with the banks recent core processing conversion.”

Capital

As of June 30, 2019, shareholders’ equity totaled $38 million, compared to $33 million at June 30, 2018. The bank’s Tier 1 Capital ratio was 9.61% at the end of the second quarter 2019, compared to 9.22% one year ago. Tangible Book value per share was $10.91 at June 30, 2019, compared to $9.78 on June 30, 2018, when adjusted for the 5% stock dividend received in May of 2019.

About People’s Bank of Commerce

People’s Bank of Commerce’s stock trades on the over-the-counter market under the symbol PBCO. Additional information about the Bank is available in the investor section of the bank’s website at: www.peoplesbank.bank.

Founded in 1998, People’s Bank of Commerce is the only locally owned and managed community bank in Southern Oregon. People’s Bank of Commerce is a full service bank headquartered in Medford, Oregon with branches in Medford, Ashland, Central Point, Grants Pass and Klamath Falls.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995:

This release includes forward-looking statements intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally can be identified by phrases such as People’s Bank or its management "believes," "expects," "anticipates," "foresees," "forecasts," "estimates" or other words or phrases of similar import. Similarly, statements herein that describe People’s Bank’s business strategy, outlook, objectives, plans, intentions or goals also are forward-looking statements. All such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those in forward-looking statements.

People's Bank of Commerce        
Balance Sheet (unaudited)        
(dollars in thousands)

6/30/2019

 

3/31/2019

 

12/31/2018

 

9/30/2018

 

6/30/2018

Assets        
Cash and due from banks

3,747

 

 

4,736

 

 

9,382

 

 

3,928

 

 

2,431

 

Federal funds sold        
Interest-bearing deposits

18,694

 

 

30,152

 

 

17,127

 

 

21,381

 

 

15,713

 

Investment securities

22,585

 

 

20,031

 

 

25,878

 

 

24,462

 

 

26,198

 

Loans held for sale

2,013

 

 

1,157

 

 

2,084

 

 

215

 

 

1,381

 

Loans held for investment, net of unearned income

261,835

 

 

256,389

 

 

249,949

 

 

240,093

 

 

233,600

 

Allowance for loan and lease losses

(2,920

)

 

(2,880

)

 

(2,812

)

 

(2,701

)

 

(2,631

)

Loans, net

258,915

 

 

254,666

 

 

247,137

 

 

237,392

 

 

230,969

 

Premises and equipment, net

20,736

 

 

21,086

 

 

16,807

 

 

16,387

 

 

16,165

 

Other assets

31,185

 

 

30,894

 

 

31,110

 

 

32,730

 

 

34,064

 

Total assets

357,875

 

 

361,565

 

 

349,525

 

 

336,495

 

 

326,921

 

         
         
Liabilities        
Deposits        
Demand noninterest-bearing

136,211

 

 

128,937

 

 

124,866

 

 

120,679

 

 

131,743

 

Demand interest-bearing

46,690

 

 

56,175

 

 

48,813

 

 

44,661

 

 

29,300

 

Money market and savings

105,310

 

 

110,237

 

 

117,714

 

 

112,728

 

 

107,634

 

Time deposits of less than $250,000

17,915

 

 

16,750

 

 

15,300

 

 

15,017

 

 

16,136

 

Time deposits of more than $250,000

2,682

 

 

1,873

 

 

1,317

 

 

2,081

 

 

2,074

 

Total deposits

308,808

 

 

313,972

 

 

308,010

 

 

295,166

 

 

286,887

 

Other liabilities

11,308

 

 

11,137

 

 

6,062

 

 

7,290

 

 

7,022

 

Total liabilities

320,116

 

 

325,109

 

 

314,072

 

 

302,456

 

 

293,909

 

         
Capital        
Common stock, surplus, retained earnings

37,913

 

 

36,863

 

 

36,011

 

 

34,920

 

 

33,891

 

Accumulated other comprehensive income (loss)

212

 

 

(2

)

 

(113

)

 

(319

)

 

(278

)

Unearned ESOP Shares

(366

)

 

(405

)

 

(445

)

 

(562

)

 

(601

)

Total shareholders' equity

37,759

 

 

36,456

 

 

35,453

 

 

34,039

 

 

33,012

 

         
Total Liabilities and Equity

357,875

 

 

361,565

 

 

349,525

 

 

336,495

 

 

326,921

 

         
memo:        
Total intangible assets and goodwill

3,486

 

 

3,486

 

 

3,486

 

 

3,468

 

 

3,468

 

         
Current shares outstanding

3,122,155

 

 

2,955,964

 

 

2,953,464

 

 

2,915,752

 

 

2,902,164

 

People's Bank of Commerce      
Income Statement (unaudited)      
Three Months Ended Twelve Months Ended
(dollars in thousands)

6/30/2019

 

3/31/2019

 

6/30/2018

6/30/2019

 

6/30/2018

Interest Income      
Loans

3,543

 

3,475

 

2,957

13,513

 

10,986

Investments

130

 

156

 

170

600

 

690

Federal funds sold and due from banks

92

 

108

 

108

543

 

338

Total interest income

3,765

 

3,739

 

3,235

14,657

 

12,014

       
Interest Expense      
Deposits

350

 

347

 

188

1,216

 

572

Other

6

 

5

 

84

163

 

144

Total interest expense

356

 

352

 

272

1,378

 

716

       
Net interest income

3,409

 

3,387

 

2,963

13,278

 

11,298

Provision for credit losses

39

 

59

 

102

280

 

283

Net Interest Income after provision for credit losses

3,370

 

3,328

 

2,861

12,999

 

11,015

       
Non-Interest Income      
Service charges on deposit accounts

78

 

67

 

78

299

 

298

Mortgage lending income

261

 

210

 

159

751

 

744

Steelhead Finance income

1,062

 

1,051

 

1,312

4,631

 

3,797

Gain (loss) on other real estate

-

 

-

 

-

 

25

Other non-interest income

274

 

227

 

289

818

 

823

Total non-interest income

1,675

 

1,555

 

1,838

6,499

 

5,687

       
Non-Interest Expense      
Salary and Benefits

2,425

 

2,380

 

2,216

9,448

 

7,720

Premises and fixed assets

547

 

549

 

474

2,110

 

1,650

Other

844

 

838

 

893

3,335

 

3,095

Total non-interest expense

3,816

 

3,767

 

3,583

14,894

 

12,465

       
Net income before taxes

1,229

 

1,116

 

1,116

4,604

 

4,237

Income taxes

296

 

277

 

271

1,003

 

1,660

Net income

933

 

839

 

845

3,601

 

2,577

       
Basic earnings per share

0.30

 

0.28

 

0.28

1.21

 

0.95

Diluted earnings per share

0.30

 

0.28

 

0.28

1.21

 

0.94

Average common shares outstanding

3,110,261

 

2,955,964

 

3,042,691

2,975,770

 

2,716,167

       
Performance Measures      
Return on average assets

1.06%

 

0.94%

 

1.06%

1.04%

 

0.84%

Return on average equity

10.09%

 

9.29%

 

10.55%

9.73%

 

8.13%

Net interest margin

4.60%

 

4.33%

 

4.19%

4.27%

 

4.20%

Efficiency ratio

75.06%

 

76.22%

 

74.63%

75.31%

 

73.39%

 

Contacts

Ken Trautman, President and CEO
(541) 774-7654, ken@peoplesbank.bank

Contacts

Ken Trautman, President and CEO
(541) 774-7654, ken@peoplesbank.bank