PCB Bancorp Reports Earnings of $6.6 million for Q2 2019

LOS ANGELES--()--PCB Bancorp (the “Company”) (NASDAQ: PCB), the holding company of Pacific City Bank (the “Bank”), today reported net income of $6.6 million, or $0.40 per diluted common share for the second quarter of 2019, compared with $6.6 million, or $0.40 per diluted common share, for the previous quarter and $4.8 million, or $0.35 per diluted common share, for the year-ago quarter.

On July 1, 2019, the Company changed its corporate name to “PCB Bancorp” from “Pacific City Financial Corporation” to reflect the Company's goal to align the corporate name with the trading symbol of its common stock and simplify corporate communications while maintaining the Company's core branding.

Q2 2019 Financial Highlights

  • Net income totaled $6.6 million or $0.40 per diluted common share;
  • Total assets were $1.73 billion at June 30, 2019, an increase of $8.7 million, or 0.5%, from $1.72 billion at March 31, 2019, an increase of $29.5 million, or 1.7%, from $1.70 billion at December 31, 2018, and an increase of $107.3 million, or 6.6%, from $1.62 billion at June 30, 2018;
  • Loans held-for-investment, net of deferred costs (fees), were $1.40 billion at June 30, 2019, an increase of $52.4 million, or 3.9%, from $1.34 billion at March 31, 2019, an increase of $56.9 million, or 4.2%, from $1.34 billion at December 31, 2018, and an increase of $140.7 million, or 11.2%, from $1.25 billion at June 30, 2018;
  • Total deposits were $1.45 billion at June 30, 2019, a decrease of $1.2 million, or 0.1%, from $1.45 billion at March 31, 2019, but an increase of $2.8 million, or 0.2%, from $1.44 billion at December 31, 2018 and an increase of $19.3 million, or 1.4%, from $1.43 billion at June 30, 2018;
    • State and Brokered deposits were $117.5 million at June 30, 2019 compared to $157.5 million, $142.5 million and $152.5 million, respectively, at March 31, 2019, December 31, 2018 and June 30, 2018.
  • The Company repurchased 57,551 shares of its common stock totaling $974 thousand under the publicly announced $6.5 million share repurchase program; and
  • The Company declared an increased cash dividend of $0.06 per common share.

“We are pleased to report another strong quarterly financial performance highlighted by earnings of $6.6 million, or $0.40 per diluted common share,” stated Henry Kim, President and Chief Executive Officer. “In spite of the uncertain interest rate environment coupled with intense competition on deposits and credits, during the second quarter our held-for-investment loan balance increased $52.4 million, or 3.9%, and our retail deposit balance, excluding wholesale deposits, increased $38.8 million, or 3.0%. We maintained our net interest margin at 4.17% during the quarter and we are successfully carrying our initiative on reducing our asset sensitive balance sheet by increasing the percentage of fixed rate loans to 37.8% at June 30, 2019 compared with 34.6% at March 31, 2019.”

Financial Highlights (Unaudited)

 

 

Three Months Ended

 

Six Months Ended

($ in thousands, except per share data)

 

6/30/2019

 

3/31/2019

 

% Change

 

6/30/2018

 

% Change

 

6/30/2019

 

6/30/2018

 

% Change

Net income

 

$

 

6,601

 

 

$

 

6,564

 

 

 

0.6

%

 

$

 

4,762

 

 

 

38.6

%

 

$

 

13,165

 

 

$

 

11,026

 

 

19.4

%

Diluted earnings per common share

 

$

 

0.40

 

 

$

 

0.40

 

 

%

 

$

 

0.35

 

 

 

14.3

%

 

$

 

0.81

 

 

$

 

0.81

 

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

 

$

 

17,692

 

 

$

 

17,153

 

 

 

3.1

%

 

$

 

15,882

 

 

 

11.4

%

 

$

 

34,845

 

 

$

 

31,176

 

 

11.8

%

Provision (reversal) for loan losses

 

 

394

 

 

 

(85

)

 

 

(563.5

)%

 

 

425

 

 

 

(7.3

)%

 

 

309

 

 

 

520

 

 

(40.6

)%

Noninterest income

 

 

3,054

 

 

 

2,409

 

 

 

26.8

%

 

 

2,273

 

 

 

34.4

%

 

 

5,463

 

 

 

5,635

 

 

(3.1

)%

Noninterest expense

 

 

10,984

 

 

 

10,289

 

 

 

6.8

%

 

 

10,940

 

 

 

0.4

%

 

 

21,273

 

 

 

20,571

 

 

3.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average assets (1)

 

 

1.52

%

 

 

1.57

%

 

 

 

 

1.20

%

 

 

 

 

1.55

%

 

 

1.45

%

 

 

Return on average shareholders’ equity (1), (2)

 

 

12.01

%

 

 

12.43

%

 

 

 

 

12.74

%

 

 

 

 

12.22

%

 

 

15.07

%

 

 

Net interest margin (1)

 

 

4.17

%

 

 

4.22

%

 

 

 

 

4.08

%

 

 

 

 

4.19

%

 

 

4.20

%

 

 

Efficiency ratio (3)

 

 

52.95

%

 

 

52.60

%

 

 

 

 

60.26

%

 

 

 

 

52.78

%

 

 

55.88

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

($ in thousands, except per share data)

 

6/30/2019

 

3/31/2019

 

% Change

 

12/31/2018

 

% Change

 

6/30/2018

 

% Change

Total assets

 

$

 

1,726,486

 

 

$

 

1,717,774

 

 

0.5

%

 

$

 

1,697,028

 

 

1.7

%

 

$

 

1,619,169

 

 

6.6

%

Net loans held-for-investment

 

 

1,382,229

 

 

 

1,330,035

 

 

3.9

%

 

 

1,325,515

 

 

4.3

%

 

 

1,242,235

 

 

11.3

%

Total deposits

 

 

1,446,526

 

 

 

1,447,758

 

 

(0.1

)%

 

 

1,443,753

 

 

0.2

%

 

 

1,427,245

 

 

1.4

%

Book value per common share (2), (4)

 

$

 

13.98

 

 

$

 

13.57

 

 

3.0

%

 

$

 

13.16

 

 

6.2

%

 

$

 

11.27

 

 

24.0

%

Tier 1 leverage ratio (consolidated)

 

 

12.74

%

 

 

12.83

%

 

 

 

 

12.60

%

 

 

 

 

9.58

%

 

 

Total shareholders’ equity to total assets (2)

 

 

12.94

%

 

 

12.64

%

 

 

 

 

12.39

%

 

 

 

 

9.35

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Ratios are presented on an annualized basis.

(2)

The Company did not have any intangible equity components for the presented periods.

(3)

The ratios are calculated by dividing noninterest expense by the sum of net interest income and noninterest income.

(4)

The ratios are calculated by dividing total shareholdersequity by the number of outstanding common shares.

Result of Operations (Unaudited)

Net Interest Income and Net Interest Margin

The following table presents the components of net interest income for the periods indicated:

 

 

Three Months Ended

 

Six Months Ended

($ in thousands)

 

6/30/2019

 

3/31/2019

 

% Change

 

6/30/2018

 

% Change

 

6/30/2019

 

6/30/2018

 

% Change

Interest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and fees on loans

 

$

 

21,969

 

 

$

 

20,934

 

 

4.9

%

 

$

 

18,610

 

 

18.0

%

 

$

 

42,903

 

 

$

 

36,050

 

 

19.0

%

Interest on investment securities

 

 

1,062

 

 

 

1,093

 

 

(2.8

)%

 

 

869

 

 

22.2

%

 

 

2,155

 

 

 

1,717

 

 

25.5

%

Interest and dividend on other interest-earning assets

 

 

999

 

 

 

925

 

 

8.0

%

 

 

865

 

 

15.5

%

 

 

1,924

 

 

 

1,205

 

 

59.7

%

Total interest income

 

 

24,030

 

 

 

22,952

 

 

4.7

%

 

 

20,344

 

 

18.1

%

 

 

46,982

 

 

 

38,972

 

 

20.6

%

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest on deposits

 

 

6,200

 

 

 

5,665

 

 

9.4

%

 

 

4,292

 

 

44.5

%

 

 

11,865

 

 

 

7,458

 

 

59.1

%

Interest on borrowings

 

 

138

 

 

 

134

 

 

3.0

%

 

 

170

 

 

(18.8

)%

 

 

272

 

 

 

338

 

 

(19.5

)%

Total interest expense

 

 

6,338

 

 

 

5,799

 

 

9.3

%

 

 

4,462

 

 

42.0

%

 

 

12,137

 

 

 

7,796

 

 

55.7

%

Net interest income

 

$

 

17,692

 

 

$

 

17,153

 

 

3.1

%

 

$

 

15,882

 

 

11.4

%

 

$

 

34,845

 

 

$

 

31,176

 

 

11.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Overall, the increases in net interest income were primarily due to increases in average balance and average yield on loans, partially offset by increases in average balance and average cost of interest-bearing deposits.

The increases in interest and fees on loans were primarily due to increases in both average balance and average yield of loans. The increase in average yield on loans for the current quarter compared with the previous quarter was primarily due to an increase in discount accretion on retained portion of sold SBA loans due to a higher prepayment trend. The increases in average yield on loans for the three and six months ended June 30, 2019 compared with the same periods of 2018 were primarily due to new loan production with higher interest rates than the existing portfolio and Company’s high proportion of variable rate loans that had repriced along with the rising interest rate environment in 2018 and current higher market rate. The following table presents a composition of total loans by interest rate type accompanied with the weighted-average contractual rates as of the dates indicated:

 

 

6/30/2019

 

3/31/2019

 

12/31/2018

 

6/30/2018

 

 

% to Total
Loans

 

Weighted-
Average
Contractual
Rate

 

% to Total
Loans

 

Weighted-
Average
Contractual
Rate

 

% to Total
Loans

 

Weighted-
Average
Contractual
Rate

 

% to Total
Loans

 

Weighted-
Average
Contractual
Rate

Fixed rate loans

 

37.8

%

 

5.24

%

 

34.6

%

 

5.17

%

 

34.4

%

 

5.13

%

 

27.0

%

 

5.08

%

Variable rate loans

 

62.2

%

 

6.29

%

 

65.4

%

 

6.29

%

 

65.6

%

 

6.30

%

 

73.0

%

 

5.84

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The Company strategically increased the proportion of fixed rate loans during the current quarter as the interest rate environment had become stabilized and in order to better-position its balance sheet to match potential rate changes in the future.

The decrease in interest on investment securities for the current quarter compared with the previous quarter was primarily due to an increase in premium amortization on mortgage-backed securities from a higher prepayment trend in the current quarter. The increases in the three and six months ended June 30, 2019 compared with the same periods of 2018 were primarily due to increases in both average balance and average yield of investment securities. The increase in average yield on investment securities was primarily due to additional purchases of investment securities along with the rising interest rate environment in 2018 and current higher market rate. The Company purchased investment securities of $4.3 million and $36.4 million, respectively, during the current quarter and last 12-month period.

The increase in interest and dividend on other interest-earning assets for the current quarter compared with the previous quarter was primarily due to an increase in average balance, partially offset by a decrease in average yield on interest-bearing deposits in other financial institutions, as the Federal Reserve lowered its interest rate on excess reserve balance from 2.40% to 2.35% in May. The increase in the current quarter compared with the year-ago quarter was primarily due to an increase in average yield on interest-bearing deposits in other financial institutions in the current higher market rates, partially offset by a decrease in average balance. The increase for the six months ended June 30, 2019 compared with the same period of 2018 was primarily due to increases in both average balance and average yield.

The increases in total interest expense were primarily due to increases in average balance and average cost of interest-bearing deposits. The increase in average cost on interest-bearing deposits was primarily due to the rising interest rate environment in 2018 and current higher market rates, and high competition in the Company’s deposit target markets.

Provision (Reversal) for Loan Losses

Provision (reversal) for loan losses was $394 thousand for the current quarter compared with $(85) thousand for the previous quarter and $425 thousand for the year-ago quarter. For the six months ended June 30, 2019 and 2018, the Company recognized provision for loan losses of $309 thousand and $520 thousand, respectively. The Company recorded net charge-offs of $203 thousand for the current quarter compared with net recoveries of $55 thousand for the previous quarter and net charge-offs of $175 thousand for the year-ago quarter. For the six months ended June 30, 2019 and 2018, the Company recorded net charge-offs of $148 thousand and $123 thousand, respectively.

Allowance for loan losses to total loans held-for-investment ratio was 0.96% at June 30, 2019, 0.98% at March 31, 2019, 0.98% at December 31, 2018, and 1.01% at June 30, 2018. The decrease in allowance for loan losses to total loans held-for-investment ratio was primarily due to a decrease in historical loss rates and changes in qualitative adjustment factors.

Noninterest Income

The following table presents the components of noninterest income for the periods indicated:

 

 

Three Months Ended

 

Six Months Ended

($ in thousands)

 

6/30/2019

 

3/31/2019

 

% Change

 

6/30/2018

 

% Change

 

6/30/2019

 

6/30/2018

 

% Change

Gain on sale of SBA loans

 

$

 

 

1,884

 

 

$

 

 

1,104

 

 

70.7

%

 

$

 

 

863

 

 

118.3

%

 

$

 

 

2,988

 

 

$

 

 

2,912

 

 

2.6

%

Gain on sale of residential property loans

 

 

7

 

 

 

16

 

 

(56.3

)%

 

 

170

 

 

(95.9

)%

 

 

23

 

 

 

192

 

 

(88.0

)%

Gain on sale of other loans

 

 

 

 

 

%

 

 

 

%

 

 

 

 

45

 

 

(100.0

)%

Total gain on sale of loans

 

 

1,891

 

 

 

1,120

 

 

68.8

%

 

 

1,033

 

 

83.1

%

 

 

3,011

 

 

 

3,149

 

 

(4.4

)%

Service charges and fees on deposits

 

 

368

 

 

 

364

 

 

1.1

%

 

 

376

 

 

(2.1

)%

 

 

732

 

 

 

725

 

 

1.0

%

Loan servicing income

 

 

492

 

 

 

631

 

 

(22.0

)%

 

 

585

 

 

(15.9

)%

 

 

1,123

 

 

 

1,211

 

 

(7.3

)%

Other income

 

 

303

 

 

 

294

 

 

3.1

%

 

 

279

 

 

8.6

%

 

 

597

 

 

 

550

 

 

8.5

%

Total noninterest income

 

$

 

 

3,054

 

 

$

 

 

2,409

 

 

26.8

%

 

$

 

 

2,273

 

 

34.4

%

 

$

 

 

5,463

 

 

$

 

 

5,635

 

 

(3.1

)%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The increases in gain on sale of SBA loans for the three and six months ended June 30, 2019 compared with the same periods of 2018 were primarily due to an increase in sales volume, partially offset by a decrease in premium rates in the secondary market. The increase for the current quarter compared with the previous quarter was primarily due to increases in both sales volume and premium rates. The Company sold the guaranteed portion of SBA loans of $29.2 million, $21.2 million and $12.6 million, respectively, for the three months ended June 30, 2019, March 31, 2019 and June 30, 2018, and $50.4 million and $42.5 million, respectively, for the six months ended June 30, 2019 and 2018. The Company also sold residential property loans of $375 thousand, $2.4 million and $7.5 million, respectively, for the three months ended June 30, 2019, March 31, 2019 and June 30, 2018, and $2.8 million and $8.7 million, respectively, for the six months ended June 30, 2019 and 2018, as well as other real estate loans of $1.1 million for the six months ended June 30, 2018.

The decreases in loan servicing income for the three and six months ended June 30, 2019 compared with the same periods of 2018 were primarily due to a lower balance of underlying loans being serviced. Underlying loans being serviced totaled $502.1 million and $540.0 million, respectively, at June 30, 2019 and 2018. The decrease for the current quarter compared with the previous quarter was primarily due to an increase in servicing asset amortization from a higher prepayment trend.

Noninterest Expense

The following table presents the components of noninterest expense for the periods indicated:

 

 

Three Months Ended

 

Six Months Ended

($ in thousands)

 

6/30/2019

 

3/31/2019

 

% Change

 

6/30/2018

 

% Change

 

6/30/2019

 

6/30/2018

 

% Change

Salaries and employee benefits

 

$

 

6,600

 

 

$

 

6,622

 

 

(0.3

)%

 

$

 

6,153

 

 

7.3

%

 

$

 

13,222

 

 

$

 

12,399

 

 

6.6

%

Occupancy and equipment

 

 

1,407

 

 

 

1,313

 

 

7.2

%

 

 

1,246

 

 

12.9

%

 

 

2,720

 

 

 

2,390

 

 

13.8

%

Professional fees

 

 

686

 

 

 

758

 

 

(9.5

)%

 

 

988

 

 

(30.6

)%

 

 

1,444

 

 

 

1,511

 

 

(4.4

)%

Marketing and business promotion

 

 

529

 

 

 

228

 

 

132.0

%

 

 

541

 

 

(2.2

)%

 

 

757

 

 

 

929

 

 

(18.5

)%

Data processing

 

 

338

 

 

 

318

 

 

6.3

%

 

 

295

 

 

14.6

%

 

 

656

 

 

 

597

 

 

9.9

%

Director fees and expenses

 

 

185

 

 

 

189

 

 

(2.1

)%

 

 

211

 

 

(12.3

)%

 

 

374

 

 

 

441

 

 

(15.2

)%

Regulatory assessments

 

 

309

 

 

 

116

 

 

166.4

%

 

 

145

 

 

113.1

%

 

 

425

 

 

 

277

 

 

53.4

%

Other expenses

 

 

930

 

 

 

745

 

 

24.8

%

 

 

1,361

 

 

(31.7

)%

 

 

1,675

 

 

 

2,027

 

 

(17.4

)%

Total noninterest expense

 

$

 

10,984

 

 

$

 

10,289

 

 

6.8

%

 

$

 

10,940

 

 

0.4

%

 

$

 

21,273

 

 

$

 

20,571

 

 

3.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Overall, the increases in salaries and employee benefits were primarily due to an increase in number of employees for supporting the expansion of the Company's infrastructure for being a public company and an enhancement of the controls and processes on Bank Secrecy Act and Anti-Money Laundering (“BSA/AML”) compliance. Comparing the current quarter with the previous quarter, the decrease was primarily due to a decrease in vacation accrual and an increase of deferred loan origination cost, which reduces salaries and benefits at origination, for a higher loan production during the current quarter, partially offset by the increase in number of employees. Comparing the three and six months ended June 30, 2019 with same periods of 2018, the increases were partially offset by decreases in bonus and vacation accruals, as well as a retirement bonus paid to the former chief executive officer of $192 thousand in the three months ended March 31, 2018.

The increases in occupancy and equipment was primarily due to increases in depreciation, occupancy lease and equipment maintenance expense. The Company opened a loan production office in Artesia, California in December 2018.

The decrease in professional fees for the current quarter compared with the previous quarter was primarily due to increased professional fees for enhancement of the Bank's controls and processes on BSA/AML compliance programs during the previous quarter, partially offset by an increase in legal fees for the Annual Meeting of Shareholders and the corporate name change. The decreases for the three and six months ended June 30, 2019 compared with the same periods of 2018 were primarily due to expenses related to the initial public offering (“IPO”) in 2018, partially offset by increases in audit fees for being a public company and expenses related to BSA/AML enhancements.

The increase in market and business promotion for the current quarter compared with the previous quarter was primarily due to an increase in advertising expense.

The increases in regulatory assessments for the three and six months ended June 30, 2019 were due to an increase in assessment rate and an adjustment made for the assessment rate increase for the previous quarter. The increase in assessment rate was primarily due to the recent consent order relating to the Bank’s compliance with BSA/AML.

The increase in other expenses for the current quarter compared with the previous quarter was primarily due to increases in other loan related legal and office expenses. The decrease for the three and six months ended June 30, 2019 compared with the same periods of 2018 was primarily due to a reimbursement paid to the SBA of $577 thousand during the year-ago quarter, partially offset by increases in other loan related legal and office expenses.

Balance Sheet (Unaudited)

Loans

The following table presents a composition of total loans (includes both loans held-for-sale and loans held-for-investment, net of deferred costs (fees)) as of the dates indicated:

($ in thousands)

 

6/30/2019

 

3/31/2019

 

% Change

 

12/31/2018

 

% Change

 

6/30/2018

 

% Change

Real estate loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial property

 

$

 

748,526

 

 

$

 

715,488

 

 

4.6

%

 

$

 

709,409

 

 

5.5

%

 

$

 

673,871

 

 

11.1

%

Residential property

 

 

240,630

 

 

 

237,115

 

 

1.5

%

 

 

233,816

 

 

2.9

%

 

 

197,229

 

 

22.0

%

SBA property

 

 

128,208

 

 

 

124,751

 

 

2.8

%

 

 

120,939

 

 

6.0

%

 

 

134,531

 

 

(4.7

)%

Construction

 

 

22,455

 

 

 

19,983

 

 

12.4

%

 

 

27,323

 

 

(17.8

)%

 

 

28,578

 

 

(21.4

)%

Commercial and industrial loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial term

 

 

105,651

 

 

 

103,866

 

 

1.7

%

 

 

102,133

 

 

3.4

%

 

 

80,730

 

 

30.9

%

Commercial lines of credit

 

 

85,197

 

 

 

77,022

 

 

10.6

%

 

 

80,473

 

 

5.9

%

 

 

72,805

 

 

17.0

%

SBA commercial term

 

 

24,762

 

 

 

26,347

 

 

(6.0

)%

 

 

27,147

 

 

(8.8

)%

 

 

28,464

 

 

(13.0

)%

Trade finance

 

 

16,334

 

 

 

14,046

 

 

16.3

%

 

 

11,521

 

 

41.8

%

 

 

7,741

 

 

111.0

%

Other consumer loans

 

 

23,794

 

 

 

24,554

 

 

(3.1

)%

 

 

25,921

 

 

(8.2

)%

 

 

30,907

 

 

(23.0

)%

Loans held-for-investment

 

 

1,395,557

 

 

 

1,343,172

 

 

3.9

%

 

 

1,338,682

 

 

4.2

%

 

 

1,254,856

 

 

11.2

%

Loans held-for-sale

 

 

440

 

 

 

3,915

 

 

(88.8

)%

 

 

5,781

 

 

(92.4

)%

 

 

20,331

 

 

(97.8

)%

Total loans

 

$

 

1,395,997

 

 

$

 

1,347,087

 

 

3.6

%

 

$

 

1,344,463

 

 

3.8

%

 

$

 

1,275,187

 

 

9.5

%

 

The increase in loans held-for-investment for the current quarter was primarily due to new funding of $109.2 million and advances on lines of credit of $30.5 million, partially offset by pay-downs and pay-offs of $87.1 million. The increase for the six months ended June 30, 2019 was primarily due to new funds of $182.4 million and advances on lines of credit of $53.9 million, partially offset by pay-downs and pay-offs of $178.9 million.

The decrease in loans held-for-sale for the current quarter was primarily due to sales of $29.5 million, partially offset by new funding of $26.1 million. The decrease in loans held-for-sale for the six months ended June 30, 2019 was primarily due to sales of $53.1 million, partially offset by new funding of $47.5 million and a loan transferred from loans held-for-investment of $303 thousand.

Credit Quality

The following table presents compositions of non-performing loans and non-performing assets as of the dates indicated:

($ in thousands)

 

6/30/2019

 

3/31/2019

 

% Change

 

12/31/2018

 

% Change

 

6/30/2018

 

% Change

Nonaccrual loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Real estate loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial property

 

$

 

 

 

$

 

 

 

%

 

$

 

 

 

%

 

$

 

240

 

 

(100.0

)%

Residential property

 

 

 

 

 

%

 

 

302

 

 

(100.0

)%

 

 

 

%

SBA property

 

 

1,372

 

 

 

1,011

 

 

35.7

%

 

 

540

 

 

154.1

%

 

 

1,203

 

 

14.0

%

Commercial and industrial loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial lines of credit

 

 

 

 

 

%

 

 

 

%

 

 

39

 

 

(100.0

)%

SBA commercial term

 

 

16

 

 

 

186

 

 

(91.4

)%

 

 

203

 

 

(92.1

)%

 

 

519

 

 

(96.9

)%

Consumer loans

 

 

41

 

 

 

74

 

 

(44.6

)%

 

 

16

 

 

156.3

%

 

 

25

 

 

64.0

%

Total nonaccrual loans held-for-investment

 

 

1,429

 

 

 

1,271

 

 

12.4

%

 

 

1,061

 

 

34.7

%

 

 

2,026

 

 

(29.5

)%

Loans past due 90 days or more and still accruing

 

 

 

 

 

%

 

 

 

%

 

 

 

%

Non-performing loans (“NPLs”)

 

 

1,429

 

 

 

1,271

 

 

12.4

%

 

 

1,061

 

 

34.7

%

 

 

2,026

 

 

(29.5

)%

Other real estate owned (“OREO”)

 

 

395

 

 

 

395

 

 

%

 

 

 

%

 

 

 

%

Non-performing assets (“NPAs”)

 

$

 

1,824

 

 

$

 

1,666

 

 

9.5

%

 

$

 

1,061

 

 

71.9

%

 

$

 

2,026

 

 

(10.0

)%

Loans past due and still accruing:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans past due 30 to 59 days and still accruing

 

$

 

804

 

 

$

 

950

 

 

(15.4

)%

 

$

 

368

 

 

118.5

%

 

$

 

145

 

 

454.5

%

Loans past due 60 to 89 days and still accruing

 

 

5

 

 

 

12

 

 

(58.3

)%

 

 

9

 

 

(44.4

)%

 

 

185

 

 

(97.3

)%

Loans past due 90 days or more and still accruing

 

 

 

 

 

%

 

 

 

%

 

 

 

%

Total loans past due and still accruing

 

$

 

809

 

 

$

 

962

 

 

(15.9

)%

 

 

377

 

 

114.6

%

 

$

 

330

 

 

145.2

%

Troubled debt restructurings (“TDRs”):

 

 

 

 

 

 

 

 

 

 

 

 

 

Accruing TDRs

 

$

 

391

 

 

$

 

412

 

 

(5.1

)%

 

$

 

432

 

 

(9.5

)%

 

$

 

453

 

 

(13.7

)%

Nonaccrual TDRs

 

 

131

 

 

 

127

 

 

3.1

%

 

 

131

 

 

%

 

 

548

 

 

(76.1

)%

Total TDRs

 

$

 

522

 

 

$

 

539

 

 

(3.2

)%

 

$

 

563

 

 

(7.3

)%

 

$

 

1,001

 

 

(47.9

)%

NPLs to loans held-for-investment

 

 

0.10

%

 

 

0.09

%

 

 

 

 

0.08

%

 

 

 

 

0.16

%

 

 

NPAs to total assets

 

 

0.11

%

 

 

0.10

%

 

 

 

 

0.06

%

 

 

 

 

0.13

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Classified Assets

Classified loans were $7.5 million at June 30, 2019, an increase of $435 thousand, or 6.2%, from $7.0 million at March 31, 2019, an increase of $1.2 million, or 20.0%, from $6.2 million at December 31, 2018, and an increase of $3.2 million, or 72.7%, from $4.3 million at June 30, 2018. Classified assets, which consist of classified loans and OREO, and the classified assets to total assets ratios were $7.9 million and 0.46%, respectively, at June 30, 2019, $7.4 million and 0.43%, respectively, at March 31, 2019, and $4.3 million and 0.27%, respectively, at June 30, 2018.

Investment Securities

Total investment securities were $165.2 million at June 30, 2019, a decrease of $2.4 million, or 1.5%, from $167.7 million at March 31, 2019, a decrease of $3.5 million, or 2.1%, from $168.8 million at December 31, 2018, but an increase of $12.7 million, or 8.3%, from $152.5 million at June 30, 2018. The decrease for the current quarter was primarily due to principal pay-downs and calls of $8.1 million and net premium amortization of $218 thousand, partially offset by purchases of $4.3 million and an increase in fair value of securities available-for-sale of $1.6 million. The decrease for the six months ended June 30, 2019 was primarily due to principal pay-downs and calls of $14.3 million and net premium amortization of $407 thousand, partially offset by purchases of $8.4 million and an increase in fair value of securities available-for-sale of $2.8 million.

Deposits

The following table presents deposit mix as of the dates indicated:

 

 

6/30/2019

 

3/31/2019

 

12/31/2018

 

6/30/2018

($ in thousands)

 

Amount

 

% to Total

 

Amount

 

% to Total

 

Amount

 

% to Total

 

Amount

 

% to Total

Noninterest-bearing demand deposits

 

$

 

339,603

 

 

23.5

%

 

$

 

330,645

 

 

22.8

%

 

$

 

329,270

 

 

22.8

%

 

$

 

347,342

 

 

24.3

%

Interest-bearing deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOW

 

 

12,638

 

 

0.9

%

 

 

13,045

 

 

0.9

%

 

 

24,683

 

 

1.7

%

 

 

13,812

 

 

1.0

%

Money market accounts

 

 

311,865

 

 

21.6

%

 

 

272,085

 

 

18.8

%

 

 

280,733

 

 

19.4

%

 

 

259,098

 

 

18.2

%

Savings

 

 

6,844

 

 

0.5

%

 

 

9,510

 

 

0.7

%

 

 

8,194

 

 

0.6

%

 

 

9,886

 

 

0.7

%

Time deposits of $250,000 or less

 

 

453,286

 

 

31.2

%

 

 

455,270

 

 

31.4

%

 

 

477,134

 

 

33.0

%

 

 

492,053

 

 

34.4

%

Time deposits of more than $250,000

 

 

204,780

 

 

14.2

%

 

 

209,693

 

 

14.5

%

 

 

181,239

 

 

12.6

%

 

 

152,554

 

 

10.7

%

State and brokered deposits

 

 

117,510

 

 

8.1

%

 

 

157,510

 

 

10.9

%

 

 

142,500

 

 

9.9

%

 

 

152,500

 

 

10.7

%

Total interest-bearing deposits

 

 

1,106,923

 

 

76.5

%

 

 

1,117,113

 

 

77.2

%

 

 

1,114,483

 

 

77.2

%

 

 

1,079,903

 

 

75.7

%

Total deposits

 

$

 

1,446,526

 

 

100.0

%

 

$

 

1,447,758

 

 

100.0

%

 

$

 

1,443,753

 

 

100.0

%

 

$

 

1,427,245

 

 

100.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The decrease for the current quarter was primarily due to closed accounts of $99.2 million and net balance decreases of $1.3 million on existing accounts, partially offset by new accounts of $96.6 million. The increase for the six months ended June 30, 2019 was primarily due to new accounts of $229.7 million, partially offset by closed accounts of $194.6 million and net balance decreases of $15.8 million on existing accounts. In order to reduce the reliance on wholesale deposits, the Company reduced state and brokered deposits by $40.0 million, or 34.0%, during the current quarter.

Operating Lease Assets and Liabilities

On January 1, 2019, the Company adopted Accounting Standard Update (“ASU”) 2016-02, “Leases (Topic 842),” and all subsequent ASUs that are related to Topic 842. The Company adopted this ASU using the optional transition method with a cumulative effect adjustment to retained earnings without restating prior financial statements for comparable amounts. As a result, the Company recognized right-of-use assets and liabilities of $9.6 million and $10.6 million, respectively, with a cumulative effect adjustment of $53 thousand to retained earnings at the date of adoption.

Shareholders’ Equity

Shareholders’ equity was $223.4 million at June 30, 2019, an increase of $6.2 million, or 2.8%, from $217.2 million at March 31, 2019, an increase of $13.1 million, or 6.2%, from $210.3 million at December 31, 2018, and an increase of $72.0 million, or 47.5%, from $151.4 million at June 30, 2018. The increases for the three and six months ended June 30, 2019 were primarily due to retention of earnings and increases in other comprehensive income, share-based compensation expense and stock options exercised, partially offset by repurchase of common stock and cash dividends paid on common stock. The year-over-year increase was primarily due to the IPO completed in August 2018 and retention of earnings, partially offset by repurchase of common stock and cash dividends paid on common stock.

On March 28, 2019, the Company’s Board of Directors approved the repurchase of up to $6.5 million of the Company’s common stock through March 27, 2020. During the current quarter, the Company repurchased 57,551 shares of its common stock totaling $974 thousand.

Capital Ratios

Based on changes to the Federal Reserve’s definition of a “Small Bank Holding Company” that increased the threshold to $3 billion in assets in August 2018, the Company is not currently subject to separate minimum capital measurements. At such time as the Company reaches the $3 billion asset level, it will again be subject to capital measurements independent of the Bank. For comparison purposes, the Company’s ratios are included in following discussion. The following table presents capital ratios for the Company and the Bank as of dates indicated:

 

 

6/30/2019

 

3/31/2019

 

12/31/2018

 

6/30/2018

PCB Bancorp

 

 

 

 

 

 

 

 

Common tier 1 capital (to risk-weighted assets)

 

16.20

%

 

16.52

%

 

16.28

%

 

12.43

%

Total capital (to risk-weighted assets)

 

17.18

%

 

17.53

%

 

17.31

%

 

13.46

%

Tier 1 capital (to risk-weighted assets)

 

16.20

%

 

16.52

%

 

16.28

%

 

12.43

%

Tier 1 capital (to average assets)

 

12.74

%

 

12.83

%

 

12.60

%

 

9.58

%

Pacific City Bank

 

 

 

 

 

 

 

 

Common tier 1 capital (to risk-weighted assets)

 

16.07

%

 

16.41

%

 

16.19

%

 

12.37

%

Total capital (to risk-weighted assets)

 

17.05

%

 

17.42

%

 

17.21

%

 

13.40

%

Tier 1 capital (to risk-weighted assets)

 

16.07

%

 

16.41

%

 

16.19

%

 

12.37

%

Tier 1 capital (to average assets)

 

12.64

%

 

12.74

%

 

12.53

%

 

9.53

%

 

 

 

 

 

 

 

 

 

About PCB Bancorp

PCB Bancorp, formerly known as Pacific City Financial Corporation, is the bank holding company for Pacific City Bank, a California state chartered bank, offering a full suite of commercial banking services to small to medium-sized businesses, individuals and professionals, primarily in Southern California, and predominantly in Korean-American and other minority communities.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements. These forward-looking statements represent plans, estimates, objectives, goals, guidelines, expectations, intentions, projections and statements of our beliefs concerning future events, business plans, objectives, expected operating results and the assumptions upon which those statements are based. Forward-looking statements include without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements, and are typically identified with words such as ‘‘may,’’ “could,” “should,” “will,” “would,” “believe,” “anticipate,” “estimate,” “expect,” “aim,” “intend,” “plan,” or words or phases of similar meaning. We caution that the forward-looking statements are based largely on our expectations and are subject to a number of known and unknown risks and uncertainties that are subject to change based on factors which are, in many instances, beyond our control. These and other important factors are detailed in various securities law filings made periodically by the Company, copies of which are available from the Company without charge. Actual results, performance or achievements could differ materially from those contemplated, expressed, or implied by the forward-looking statements. Any forward-looking statements presented herein are made only as of the date of this press release, and we do not undertake any obligation to update or revise any forward-looking statements to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise, except as required by law.

PCB Bancorp and Subsidiary

Consolidated Balance Sheets (Unaudited)

($ in thousands, except share and per share data)

 

 

 

6/30/2019

 

3/31/2019

 

% Change

 

12/31/2018

 

% Change

 

6/30/2018

 

% Change

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

 

$

 

19,080

 

 

$

 

22,106

 

 

(13.7

)%

 

$

 

24,121

 

 

(20.9

)%

 

$

 

33,800

 

 

(43.6

)%

Interest-bearing deposits in financial institutions

 

 

114,205

 

 

 

151,481

 

 

(24.6

)%

 

 

138,152

 

 

(17.3

)%

 

 

134,846

 

 

(15.3

)%

Total cash and cash equivalents

 

 

133,285

 

 

 

173,587

 

 

(23.2

)%

 

 

162,273

 

 

(17.9

)%

 

 

168,646

 

 

(21.0

)%

Securities available-for-sale, at fair value

 

 

142,539

 

 

 

144,353

 

 

(1.3

)%

 

 

146,991

 

 

(3.0

)%

 

 

132,106

 

 

7.9

%

Securities held-to-maturity

 

 

22,685

 

 

 

23,311

 

 

(2.7

)%

 

 

21,760

 

 

4.3

%

 

 

20,390

 

 

11.3

%

Total investment securities

 

 

165,224

 

 

 

167,664

 

 

(1.5

)%

 

 

168,751

 

 

(2.1

)%

 

 

152,496

 

 

8.3

%

Loans held-for-sale

 

 

440

 

 

 

3,915

 

 

(88.8

)%

 

 

5,781

 

 

(92.4

)%

 

 

20,331

 

 

(97.8

)%

Loans held-for-investment, net of deferred loan costs (fees)

 

 

1,395,557

 

 

 

1,343,172

 

 

3.9

%

 

 

1,338,682

 

 

4.2

%

 

 

1,254,856

 

 

11.2

%

Allowance for loan losses

 

 

(13,328

)

 

 

(13,137

)

 

1.5

%

 

 

(13,167

)

 

1.2

%

 

 

(12,621

)

 

5.6

%

Net loans held-for-investment

 

 

1,382,229

 

 

 

1,330,035

 

 

3.9

%

 

 

1,325,515

 

 

4.3

%

 

 

1,242,235

 

 

11.3

%

Premises and equipment, net

 

 

4,334

 

 

 

4,259

 

 

1.8

%

 

 

4,588

 

 

(5.5

)%

 

 

4,892

 

 

(11.4

)%

Federal Home Loan Bank and other bank stock

 

 

8,345

 

 

 

7,433

 

 

12.3

%

 

 

7,433

 

 

12.3

%

 

 

7,433

 

 

12.3

%

Other real estate owned, net

 

 

395

 

 

 

395

 

 

%

 

 

 

%

 

 

 

%

Deferred tax assets, net

 

 

3,241

 

 

 

3,251

 

 

(0.3

)%

 

 

3,377

 

 

(4.0

)%

 

 

4,360

 

 

(25.7

)%

Servicing assets

 

 

7,230

 

 

 

7,485

 

 

(3.4

)%

 

 

7,666

 

 

(5.7

)%

 

 

8,390

 

 

(13.8

)%

Operating lease assets

 

 

10,105

 

 

 

9,132

 

 

10.7

%

 

 

 

%

 

 

 

%

Accrued interest receivable and other assets

 

 

11,658

 

 

 

10,618

 

 

9.8

%

 

 

11,644

 

 

0.1

%

 

 

10,386

 

 

12.2

%

Total assets

 

$

 

1,726,486

 

 

$

 

1,717,774

 

 

0.5

%

 

$

 

1,697,028

 

 

1.7

%

 

$

 

1,619,169

 

 

6.6

%

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing demand

 

$

 

339,603

 

 

$

 

330,645

 

 

2.7

%

 

$

 

329,270

 

 

3.1

%

 

$

 

347,342

 

 

(2.2

)%

Savings, NOW and money market accounts

 

 

331,357

 

 

 

294,650

 

 

12.5

%

 

 

313,610

 

 

5.7

%

 

 

282,796

 

 

17.2

%

Time deposits of $250,000 or less

 

 

480,786

 

 

 

492,770

 

 

(2.4

)%

 

 

519,634

 

 

(7.5

)%

 

 

544,553

 

 

(11.7

)%

Time deposits of more than $250,000

 

 

294,780

 

 

 

329,693

 

 

(10.6

)%

 

 

281,239

 

 

4.8

%

 

 

252,554

 

 

16.7

%

Total deposits

 

 

1,446,526

 

 

 

1,447,758

 

 

(0.1

)%

 

 

1,443,753

 

 

0.2

%

 

 

1,427,245

 

 

1.4

%

Federal Home Loan Bank advances

 

 

35,000

 

 

 

30,000

 

 

16.7

%

 

 

30,000

 

 

16.7

%

 

 

30,000

 

 

16.7

%

Operating lease liabilities

 

 

11,131

 

 

 

10,133

 

 

9.8

%

 

 

 

%

 

 

 

%

Accrued interest payable and other liabilities

 

 

10,429

 

 

 

12,672

 

 

(17.7

)%

 

 

12,979

 

 

(19.6

)%

 

 

10,493

 

 

(0.6

)%

Total liabilities

 

 

1,503,086

 

 

 

1,500,563

 

 

0.2

%

 

 

1,486,732

 

 

1.1

%

 

 

1,467,738

 

 

2.4

%

Commitments and contingent liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shareholders’ equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock

 

 

170,769

 

 

 

171,407

 

 

(0.4

)%

 

 

171,067

 

 

(0.2

)%

 

 

125,579

 

 

36.0

%

Additional paid-in capital

 

 

3,366

 

 

 

3,336

 

 

0.9

%

 

 

3,299

 

 

2.0

%

 

 

3,206

 

 

5.0

%

Retained earnings

 

 

48,927

 

 

 

43,288

 

 

13.0

%

 

 

37,577

 

 

30.2

%

 

 

25,258

 

 

93.7

%

Accumulated other comprehensive loss, net

 

 

338

 

 

 

(820

)

 

(141.2

)%

 

 

(1,647

)

 

(120.5

)%

 

 

(2,612

)

 

(112.9

)%

Total shareholders’ equity

 

 

223,400

 

 

 

217,211

 

 

2.8

%

 

 

210,296

 

 

6.2

%

 

 

151,431

 

 

47.5

%

Total liabilities and shareholders’ equity

 

$

 

1,726,486

 

 

$

 

1,717,774

 

 

0.5

%

 

$

 

1,697,028

 

 

1.7

%

 

$

 

1,619,169

 

 

6.6

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Outstanding common shares

 

 

15,980,655

 

 

 

16,011,151

 

 

 

 

 

15,977,754

 

 

 

 

 

13,435,214

 

 

 

Book value per common share (1)

 

$

 

13.98

 

 

$

 

13.57

 

 

 

 

$

 

13.16

 

 

 

 

$

 

11.27

 

 

 

Total loan to total deposit ratio

 

 

96.51

%

 

 

93.05

%

 

 

 

 

93.12

%

 

 

 

 

89.35

%

 

 

Noninterest-bearing deposits to total deposits

 

 

23.48

%

 

 

22.84

%

 

 

 

 

22.81

%

 

 

 

 

24.34

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

The ratios are calculated by dividing total shareholders equity by the number of outstanding common shares. The Company did not have any intangible equity components for the presented periods.

PCB Bancorp and Subsidiary

Consolidated Statements of Income (Unaudited)

($ in thousands, except share and per share data)

 

 

Three Months Ended

 

Six Months Ended

 

6/30/2019

 

3/31/2019

 

% Change

 

6/30/2018

 

% Change

 

6/30/2019

 

6/30/2018

 

% Change

Interest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and fees on loans

$

 

 

21,969

 

 

$

 

 

20,934

 

 

4.9

%

 

$

 

 

18,610

 

 

18.0

%

 

$

 

 

42,903

 

 

$

 

 

36,050

 

 

19.0

%

Interest on investment securities

 

1,062

 

 

 

1,093

 

 

(2.8

)%

 

 

869

 

 

22.2

%

 

 

2,155

 

 

 

1,717

 

 

25.5

%

Interest and dividend on other interest-earning assets

 

999

 

 

 

925

 

 

8.0

%

 

 

865

 

 

15.5

%

 

 

1,924

 

 

 

1,205

 

 

59.7

%

Total interest income

 

24,030

 

 

 

22,952

 

 

4.7

%

 

 

20,344

 

 

18.1

%

 

 

46,982

 

 

 

38,972

 

 

20.6

%

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest on deposits

 

6,200

 

 

 

5,665

 

 

9.4

%

 

 

4,292

 

 

44.5

%

 

 

11,865

 

 

 

7,458

 

 

59.1

%

Interest on other borrowings

 

138

 

 

 

134

 

 

3.0

%

 

 

170

 

 

(18.8

)%

 

 

272

 

 

 

338

 

 

(19.5

)%

Total interest expense

 

6,338

 

 

 

5,799

 

 

9.3

%

 

 

4,462

 

 

42.0

%

 

 

12,137

 

 

 

7,796

 

 

55.7

%

Net interest income

 

17,692

 

 

 

17,153

 

 

3.1

%

 

 

15,882

 

 

11.4

%

 

 

34,845

 

 

 

31,176

 

 

11.8

%

Provision (reversal) for loan losses

 

394

 

 

 

(85

)

 

(563.5

)%

 

 

425

 

 

(7.3

)%

 

 

309

 

 

 

520

 

 

(40.6

)%

Net interest income after provision for loan losses

 

17,298

 

 

 

17,238

 

 

0.3

%

 

 

15,457

 

 

11.9

%

 

 

34,536

 

 

 

30,656

 

 

12.7

%

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain on sale of SBA loans

 

1,884

 

 

 

1,104

 

 

70.7

%

 

 

863

 

 

118.3

%

 

 

2,988

 

 

 

2,912

 

 

2.6

%

Gain on sale of residential property loans

 

7

 

 

 

16

 

 

(56.3

)%

 

 

170

 

 

(95.9

)%

 

 

23

 

 

 

192

 

 

(88.0

)%

Gain on sale of other loans

 

 

 

 

%

 

 

 

%

 

 

 

 

45

 

 

(100.0

)%

Service charges and fees on deposits

 

368

 

 

 

364

 

 

1.1

%

 

 

376

 

 

(2.1

)%

 

 

732

 

 

 

725

 

 

1.0

%

Servicing income

 

492

 

 

 

631

 

 

(22.0

)%

 

 

585

 

 

(15.9

)%

 

 

1,123

 

 

 

1,211

 

 

(7.3

)%

Other income

 

303

 

 

 

294

 

 

3.1

%

 

 

279

 

 

8.6

%

 

 

597

 

 

 

550

 

 

8.5

%

Total noninterest income

 

3,054

 

 

 

2,409

 

 

26.8

%

 

 

2,273

 

 

34.4

%

 

 

5,463

 

 

 

5,635

 

 

(3.1

)%

Noninterest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

6,600

 

 

 

6,622

 

 

(0.3

)%

 

 

6,153

 

 

7.3

%

 

 

13,222

 

 

 

12,399

 

 

6.6

%

Occupancy and equipment

 

1,407

 

 

 

1,313

 

 

7.2

%

 

 

1,246

 

 

12.9

%

 

 

2,720

 

 

 

2,390

 

 

13.8

%

Professional fees

 

686

 

 

 

758

 

 

(9.5

)%

 

 

988

 

 

(30.6

)%

 

 

1,444

 

 

 

1,511

 

 

(4.4

)%

Marketing and business promotion

 

529

 

 

 

228

 

 

132.0

%

 

 

541

 

 

(2.2

)%

 

 

757

 

 

 

929

 

 

(18.5

)%

Data processing

 

338

 

 

 

318

 

 

6.3

%

 

 

295

 

 

14.6

%

 

 

656

 

 

 

597

 

 

9.9

%

Director fees and expenses

 

185

 

 

 

189

 

 

(2.1

)%

 

 

211

 

 

(12.3

)%

 

 

374

 

 

 

441

 

 

(15.2

)%

Regulatory assessments

 

309

 

 

 

116

 

 

166.4

%

 

 

145

 

 

113.1

%

 

 

425

 

 

 

277

 

 

53.4

%

Other expenses

 

930

 

 

 

745

 

 

24.8

%

 

 

1,361

 

 

(31.7

)%

 

 

1,675

 

 

 

2,027

 

 

(17.4

)%

Total noninterest expense

 

10,984

 

 

 

10,289

 

 

6.8

%

 

 

10,940

 

 

0.4

%

 

 

21,273

 

 

 

20,571

 

 

3.4

%

Income before income taxes

 

9,368

 

 

 

9,358

 

 

0.1

%

 

 

6,790

 

 

38.0

%

 

 

18,726

 

 

 

15,720

 

 

19.1

%

Income tax expense

 

2,767

 

 

 

2,794

 

 

(1.0

)%

 

 

2,028

 

 

36.4

%

 

 

5,561

 

 

 

4,694

 

 

18.5

%

Net income

$

 

 

6,601

 

 

$

 

 

6,564

 

 

0.6

%

 

$

 

 

4,762

 

 

38.6

%

 

$

 

 

13,165

 

 

$

 

 

11,026

 

 

19.4

%

Earnings per common share

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

$

 

 

0.41

 

 

$

 

 

0.41

 

 

 

 

$

 

 

0.35

 

 

 

 

$

 

 

0.82

 

 

$

 

 

0.82

 

 

 

Diluted

$

 

 

0.40

 

 

$

 

 

0.40

 

 

 

 

$

 

 

0.35

 

 

 

 

$

 

 

0.81

 

 

$

 

 

0.81

 

 

 

Average common shares outstanding

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

16,017,089

 

 

 

15,999,464

 

 

 

 

 

13,432,775

 

 

 

 

 

16,008,325

 

 

 

13,425,557

 

 

 

Diluted

 

16,330,039

 

 

 

16,271,269

 

 

 

 

 

13,628,677

 

 

 

 

 

16,303,274

 

 

 

13,607,834

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividend paid per common share

$

 

 

0.06

 

 

$

 

 

0.05

 

 

 

 

$

 

 

0.03

 

 

 

 

$

 

 

0.11

 

 

$

 

 

0.06

 

 

 

Return on average assets (1)

 

1.52

%

 

 

1.57

%

 

 

 

 

1.20

%

 

 

 

 

1.55

%

 

 

1.45

%

 

 

Return on average shareholders’ equity (1), (2)

 

12.01

%

 

 

12.43

%

 

 

 

 

12.74

%

 

 

 

 

12.22

%

 

 

15.07

%

 

 

Efficiency ratio (3)

 

52.95

%

 

 

52.60

%

 

 

 

 

60.26

%

 

 

 

 

52.78

%

 

 

55.88

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Ratios are presented on an annualized basis.

(2)

The Company did not have any intangible equity components for the presented periods.

(3)

The ratios are calculated by dividing noninterest expense by the sum of net interest income and noninterest income.

PCB Bancorp and Subsidiary

Average Balance, Average Yield, and Average Rate (Unaudited)

($ in thousands)

 

 

Three Months Ended

 

 

6/30/19

 

3/31/19

 

6/30/18

 

 

Average
Balance

 

Interest
Income/
Expense

 

Avg.
Yield/R
ate

 

Average
Balance

 

Interest
Income/
Expense

 

Avg.
Yield/R
ate

 

Average
Balance

 

Interest
Income/
Expense

 

Avg.
Yield/R
ate

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total loans (1)

 

$

 

 

1,378,910

 

 

$

 

 

21,969

 

 

6.39

%

 

$

 

 

1,342,168

 

 

$

 

 

20,934

 

 

6.33

%

 

$

 

 

1,236,075

 

 

$

 

 

18,610

 

 

6.04

%

Mortgage-backed securities

 

 

53,027

 

 

 

325

 

 

2.46

%

 

 

54,908

 

 

 

358

 

 

2.64

%

 

 

65,708

 

 

 

378

 

 

2.31

%

Collateralized mortgage obligation

 

 

21,297

 

 

 

140

 

 

2.64

%

 

 

22,142

 

 

 

147

 

 

2.69

%

 

 

52,455

 

 

 

309

 

 

2.36

%

SBA loan pool securities

 

 

87,787

 

 

 

559

 

 

2.55

%

 

 

84,523

 

 

 

549

 

 

2.63

%

 

 

23,212

 

 

 

141

 

 

2.44

%

Municipal bonds (2)

 

 

5,880

 

 

 

38

 

 

2.59

%

 

 

5,888

 

 

 

39

 

 

2.69

%

 

 

6,552

 

 

 

41

 

 

2.51

%

Other interest-earning assets

 

 

154,661

 

 

 

999

 

 

2.59

%

 

 

140,464

 

 

 

925

 

 

2.67

%

 

 

175,615

 

 

 

865

 

 

1.98

%

Total interest-earning assets

 

 

1,701,562

 

 

 

24,030

 

 

5.66

%

 

 

1,650,093

 

 

 

22,952

 

 

5.64

%

 

 

1,559,617

 

 

 

20,344

 

 

5.23

%

Noninterest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

 

18,342

 

 

 

 

 

 

 

18,678

 

 

 

 

 

 

 

18,530

 

 

 

 

 

Allowance for loan losses

 

 

(13,163

)

 

 

 

 

 

 

(13,118

)

 

 

 

 

 

 

(12,446

)

 

 

 

 

Other assets

 

 

35,843

 

 

 

 

 

 

 

34,696

 

 

 

 

 

 

 

27,460

 

 

 

 

 

Total noninterest-earning assets

 

 

41,022

 

 

 

 

 

 

 

40,256

 

 

 

 

 

 

 

33,544

 

 

 

 

 

Total assets

 

$

 

 

1,742,584

 

 

 

 

 

 

$

 

 

1,690,349

 

 

 

 

 

 

$

 

 

1,593,161

 

 

 

 

 

Liabilities and Shareholders’ Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOW and money market accounts

 

$

 

 

323,285

 

 

 

1,339

 

 

1.66

%

 

$

 

 

293,245

 

 

 

1,132

 

 

1.57

%

 

$

 

 

279,515

 

 

 

773

 

 

1.11

%

Savings

 

 

9,146

 

 

 

14

 

 

0.61

%

 

 

8,469

 

 

 

8

 

 

0.38

%

 

 

8,739

 

 

 

6

 

 

0.28

%

Time deposits

 

 

811,247

 

 

 

4,847

 

 

2.40

%

 

 

813,934

 

 

 

4,525

 

 

2.25

%

 

 

790,430

 

 

 

3,513

 

 

1.78

%

Total interest-bearing deposits

 

 

1,143,678

 

 

 

6,200

 

 

2.17

%

 

 

1,115,648

 

 

 

5,665

 

 

2.06

%

 

 

1,078,684

 

 

 

4,292

 

 

1.60

%

Federal Home Loan Bank advances

 

 

30,166

 

 

 

138

 

 

1.83

%

 

 

30,074

 

 

 

134

 

 

1.81

%

 

 

39,782

 

 

 

170

 

 

1.71

%

Total interest-bearing liabilities

 

 

1,173,844

 

 

 

6,338

 

 

2.17

%

 

 

1,145,722

 

 

 

5,799

 

 

2.05

%

 

 

1,118,466

 

 

 

4,462

 

 

1.60

%

Noninterest-bearing liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing demand

 

 

326,813

 

 

 

 

 

 

 

308,071

 

 

 

 

 

 

 

315,232

 

 

 

 

 

Other liabilities

 

 

21,441

 

 

 

 

 

 

 

22,322

 

 

 

 

 

 

 

9,533

 

 

 

 

 

Total noninterest-bearing liabilities

 

 

348,254

 

 

 

 

 

 

 

330,393

 

 

 

 

 

 

 

324,765

 

 

 

 

 

Total liabilities

 

 

1,522,098

 

 

 

 

 

 

 

1,476,115

 

 

 

 

 

 

 

1,443,231

 

 

 

 

 

Total shareholders’ equity

 

 

220,486

 

 

 

 

 

 

 

214,234

 

 

 

 

 

 

 

149,930

 

 

 

 

 

Total liabilities and shareholders’ equity

 

$

 

 

1,742,584

 

 

 

 

 

 

$

 

 

1,690,349

 

 

 

 

 

 

$

 

 

1,593,161

 

 

 

 

 

Net interest income

 

 

 

$

 

 

17,692

 

 

 

 

 

 

$

 

 

17,153

 

 

 

 

 

 

$

 

 

15,882

 

 

 

Net interest spread (3)

 

 

 

 

 

3.49

%

 

 

 

 

 

3.59

%

 

 

 

 

 

3.63

%

Net interest margin (4)

 

 

 

 

 

4.17

%

 

 

 

 

 

4.22

%

 

 

 

 

 

4.08

%

Total deposits

 

$

 

 

1,470,491

 

 

$

 

 

6,200

 

 

1.69

%

 

$

 

 

1,423,719

 

 

$

 

 

5,665

 

 

1.61

%

 

$

 

 

1,393,916

 

 

$

 

 

4,292

 

 

1.24

%

Total funding (5)

 

$

 

 

1,500,657

 

 

$

 

 

6,338

 

 

1.69

%

 

$

 

 

1,453,793

 

 

$

 

 

5,799

 

 

1.62

%

 

$

 

 

1,433,698

 

 

$

 

 

4,462

 

 

1.25

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Total loans include both loans held-for-sale and loans held-for-investment, net of deferred loan costs (fees).

(2)

The yield on municipal bonds has not been computed on a tax-equivalent basis.

(3)

Net interest spread is calculated by subtracting average rate on interest-bearing liabilities from average yield on interest-earning assets.

(4)

Net interest margin is calculated by dividing annualized net interest income by average interest-earning assets.

(5)

Total funding is the sum of interest-bearing liabilities and noninterest-bearing deposits. The cost of total funding is calculated as annualized total interest expense divided by average total funding.

PCB Bancorp and Subsidiary

Average Balance, Average Yield, and Average Rate (Unaudited)

($ in thousands)

 

 

 

Six Months Ended

 

 

6/30/19

 

6/30/18

 

 

Average
Balance

 

Interest
Income/
Expense

 

Avg.
Yield/R
ate

 

Average
Balance

 

Interest
Income/
Expense

 

Avg.
Yield/R
ate

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

Total loans (1)

 

$

 

1,360,641

 

 

$

 

42,903

 

 

6.36

%

 

$

 

1,228,015

 

 

$

 

36,050

 

 

5.92

%

Mortgage-backed securities

 

 

86,164

 

 

 

1,108

 

 

2.59

%

 

 

66,591

 

 

 

769

 

 

2.33

%

Collateralized mortgage obligation

 

 

53,962

 

 

 

683

 

 

2.55

%

 

 

51,719

 

 

 

589

 

 

2.30

%

SBA loan pool securities

 

 

21,717

 

 

 

287

 

 

2.66

%

 

 

23,778

 

 

 

278

 

 

2.36

%

Municipal bonds (2)

 

 

5,884

 

 

 

77

 

 

2.64

%

 

 

6,567

 

 

 

81

 

 

2.49

%

Other interest-earning assets

 

 

147,601

 

 

 

1,924

 

 

2.63

%

 

 

120,107

 

 

 

1,205

 

 

2.02

%

Total interest-earning assets

 

 

1,675,969

 

 

 

46,982

 

 

5.65

%

 

 

1,496,777

 

 

 

38,972

 

 

5.25

%

Noninterest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

 

18,509

 

 

 

 

 

 

 

19,425

 

 

 

 

 

Allowance for loan losses

 

 

(13,141

)

 

 

 

 

 

 

(12,406

)

 

 

 

 

Other assets

 

 

35,215

 

 

 

 

 

 

 

27,105

 

 

 

 

 

Total noninterest-earning assets

 

 

40,583

 

 

 

 

 

 

 

34,124

 

 

 

 

 

Total assets

 

$

 

1,716,552

 

 

 

 

 

 

$

 

1,530,901

 

 

 

 

 

Liabilities and Shareholders’ Equity

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

 

 

 

 

NOW and money market accounts

 

$

 

308,348

 

 

 

2,471

 

 

2.54

%

 

$

 

288,680

 

 

 

1,533

 

 

1.07

%

Savings

 

 

8,810

 

 

 

22

 

 

2.59

%

 

 

8,686

 

 

 

12

 

 

0.28

%

Time deposits

 

 

812,583

 

 

 

9,372

 

 

5.66

%

 

 

722,654

 

 

 

5,913

 

 

1.65

%

Total interest-bearing deposits

 

 

1,129,741

 

 

 

11,865

 

 

2.12

%

 

 

1,020,020

 

 

 

7,458

 

 

1.47

%

Federal Home Loan Bank advances

 

 

30,120

 

 

 

272

 

 

1.82

%

 

 

39,890

 

 

 

338

 

 

1.71

%

Total interest-bearing liabilities

 

 

1,159,861

 

 

 

12,137

 

 

2.11

%

 

 

1,059,910

 

 

 

7,796

 

 

1.48

%

Noninterest-bearing liabilities

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing demand

 

 

317,493

 

 

 

 

 

 

 

314,450

 

 

 

 

 

Other liabilities

 

 

21,880

 

 

 

 

 

 

 

8,962

 

 

 

 

 

Total noninterest-bearing liabilities

 

 

339,373

 

 

 

 

 

 

 

323,412

 

 

 

 

 

Total liabilities

 

 

1,499,234

 

 

 

 

 

 

 

1,383,322

 

 

 

 

 

Total shareholders’ equity

 

 

217,318

 

 

 

 

 

 

 

147,579

 

 

 

 

 

Total liabilities and shareholders’ equity

 

$

 

1,716,552

 

 

 

 

 

 

$

 

1,530,901

 

 

 

 

 

Net interest income

 

 

 

$

 

34,845

 

 

 

 

 

 

$

 

31,176

 

 

 

Net interest spread (3)

 

 

 

 

 

3.54

%

 

 

 

 

 

3.77

%

Net interest margin (4)

 

 

 

 

 

4.19

%

 

 

 

 

 

4.20

%

Total deposits

 

$

 

1,447,234

 

 

$

 

11,865

 

 

1.65

%

 

$

 

1,334,470

 

 

$

 

7,458

 

 

1.13

%

Total funding (5)

 

$

 

1,477,354

 

 

$

 

12,137

 

 

1.66

%

 

$

 

1,374,360

 

 

$

 

7,796

 

 

1.14

%

(1)

 

Total loans include both loans held-for-sale and loans held-for-investment, net of deferred loan costs (fees).

(2)

 

The yield on municipal bonds has not been computed on a tax-equivalent basis.

(3)

Net interest spread is calculated by subtracting average rate on interest-bearing liabilities from average yield on interest-earning assets.

(4)

Net interest margin is calculated by dividing annualized net interest income by average interest-earning assets.

(5)

Total funding is the sum of interest-bearing liabilities and noninterest-bearing deposits. The cost of total funding is calculated as annualized total interest expense divided by average total funding.

 

Contacts

Timothy Chang
Executive Vice President & Chief Financial Officer
213-210-2000

Contacts

Timothy Chang
Executive Vice President & Chief Financial Officer
213-210-2000