Central Valley Community Bancorp Reports Earnings Results for the Nine Months and Quarter Ended September 30, 2019, and Quarterly Dividend

FRESNO, Calif.--()--The Board of Directors of Central Valley Community Bancorp (Company) (NASDAQ: CVCY), the parent company of Central Valley Community Bank (Bank), reported today unaudited consolidated net income of $16,994,000, and fully diluted earnings per common share of $1.25 for the nine months ended September 30, 2019, compared to $16,008,000 and $1.16 per fully diluted common share for the nine months ended September 30, 2018.

THIRD QUARTER FINANCIAL HIGHLIGHTS

  • Net loans increased $23.4 million or 2.57%, and total assets increased $46.3 million or 3.01% at September 30, 2019 compared to December 31, 2018.
  • Total deposits increased 2.14% to $1.31 billion at September 30, 2019 compared to December 31, 2018.
  • Total cost of deposits remains at low levels at 0.17% and 0.10% for the quarter ended September 30, 2019 and 2018, respectively.
  • Average non-interest bearing demand deposit accounts as a percentage of total average deposits was 43.24% and 42.09% for the quarters ended September 30, 2019 and 2018, respectively.
  • Capital positions remain strong at September 30, 2019 with a 11.47% Tier 1 Leverage Ratio; a 14.84% Common Equity Tier 1 Ratio; a 15.28% Tier 1 Risk-Based Capital Ratio; and a 16.13% Total Risk-Based Capital Ratio.
  • The Company declared a $0.11 per common share cash dividend, payable on November 15, 2019 to shareholders of record on November 1, 2019.
  • During the quarter ended September 30, 2019, the Company repurchased and retired a total of 188,383 shares of common stock at an average price paid per share of $20.53. During the nine months ended September 30, 2019, the Company has repurchased and retired a total of 508,983 shares at an average price paid per share of $20.01.

“Average Loans and deposits grew on a linked quarter basis, notwithstanding our normal agricultural loan pay downs in the quarter,” stated James M. Ford, President & CEO of Central Valley Community Bank and Central Valley Community Bancorp. “Our restructured sales teams are now in place with more emphasis on client revenue growth, so we believe we are positioned to finish the 2019 year strong and have a solid platform to begin 2020. As we enter 2020, the Company proudly celebrates the anniversary of our 40th year in business with solid capital levels to navigate whatever changes might be coming in interest rates and the economy.”

Net income for the nine months ended September 30, 2019 increased 6.16%, primarily driven by an increase in net interest income and an increase in net realized gains on sales and calls of investment securities, partially offset by an increase in non-interest expense and an increase in the provision for income taxes, compared to the nine months ended September 30, 2018. During the nine months ended September 30, 2019, the Company recorded a $525,000 provision for credit losses, compared to a $50,000 provision during the nine months ended September 30, 2018. Net interest income before the provision for credit losses for the nine months ended September 30, 2019 was $47,985,000, compared to $46,730,000 for the nine months ended September 30, 2018, an increase of $1,255,000 or 2.69%. The impact to interest income from the accretion of the loan marks on acquired loans was $750,000 and $906,000 for the nine months ended September 30, 2019 and 2018, respectively. In addition, net interest income before the provision for credit losses for the nine months ended September 30, 2019 was benefited by approximately $593,000 in nonrecurring income from prepayment penalties and payoff of loans previously on nonaccrual status, as compared to a $355,000 in nonrecurring income for the nine months ended September 30, 2018. Excluding these reversals and benefits, net interest income for the nine months ended September 30, 2019 increased by $1,017,000 compared to the nine months ended September 30, 2018.

During the nine months ended September 30, 2019, the Company’s shareholders’ equity increased $13,444,000, or 6.12%, compared to December 31, 2018. The increase in shareholders’ equity was driven by the retention of earnings, net of dividends paid, and an increase in net unrealized gains on available-for-sale (AFS) securities recorded, net of estimated taxes, in accumulated other comprehensive income (AOCI).

Return on average equity (ROE) for the nine months ended September 30, 2019 was 9.96%, compared to 10.16% for the nine months ended September 30, 2018. The decrease in ROE was primarily due to the increase in shareholders’ equity compared to the prior year period. The Company declared and paid $0.32 and $0.22 per share in cash dividends to holders of common stock during the nine months ended September 30, 2019 and 2018, respectively. Annualized return on average assets (ROA) was 1.44% for the nine months ended September 30, 2019 and 1.34% for the nine months ended September 30, 2018. During the nine months ended September 30, 2019, the Company’s total assets increased 3.01%, and total liabilities increased 2.49%, compared to December 31, 2018.

Non-performing assets decreased by $583,000, or 21.28%, to $2,157,000 at September 30, 2019, compared to $2,740,000 at December 31, 2018. During the nine months ended September 30, 2019, the Company recorded $134,000 in net loan charge-offs, compared to $197,000 in net recoveries for the nine months ended September 30, 2018. The net charge-off (recovery) ratio, which reflects annualized net recoveries to average loans, was 0.02% for the nine months ended September 30, 2019, compared to (0.03)% for the same period in 2018. Total non-performing assets were 0.14% and 0.18% of total assets as of September 30, 2019 and December 31, 2018, respectively.

At September 30, 2019, the allowance for credit losses was $9,495,000, compared to $9,104,000 at December 31, 2018, a net increase of $391,000 reflecting the net charge-offs and provision during the period. The allowance for credit losses as a percentage of total loans was 1.01% and 0.99% as of September 30, 2019 and December 31, 2018, respectively. Total loans includes loans acquired in the acquisitions of Folsom Lake Bank on October 1, 2017, Sierra Vista Bank on October 1, 2016 and Visalia Community Bank on July 1, 2013 that, at their respective acquisition dates, were recorded at fair value and did not have a related allowance for credit losses. The recorded value of acquired loans totaled $160,455,000 at September 30, 2019 and $189,719,000 at December 31, 2018. Excluding these acquired loans from the calculation, the allowance for credit losses to total gross loans was 1.21% and 1.25% as of September 30, 2019 and December 31, 2018, respectively, and general reserves associated with non-impaired loans to total non-impaired loans was 1.21% and 1.25%, respectively. The Company believes the allowance for credit losses is adequate to provide for probable incurred credit losses within the loan portfolio at September 30, 2019.

The Company’s net interest margin (fully tax equivalent basis) was 4.54% for the nine months ended September 30, 2019, compared to 4.40% for the nine months ended September 30, 2018. The increase in net interest margin in the period-to-period comparison resulted from the increase in the effective yield on interest earning deposits in other banks and Federal Funds sold, the increase in the effective yield on average investment securities, and the increase in the yield on the Company’s loan portfolio.

For the nine months ended September 30, 2019, the effective yield on average total earning assets increased 23 basis points to 4.73% compared to 4.50% for the nine months ended September 30, 2018, while the cost of average total interest-bearing liabilities increased to 0.35% for the nine months ended September 30, 2019 as compared to 0.18% for the nine months ended September 30, 2018. Over the same periods, the cost of average total deposits increased to 0.15% for the nine months ended September 30, 2019 compared to 0.08% for the same period in 2018.

For the nine months ended September 30, 2019, the Company’s average investment securities, including interest-earning deposits in other banks and Federal funds sold, totaled $492,766,000, a decrease of $44,785,000, or 8.33%, compared to the nine months September 30, 2018. The effective yield on average investment securities, including interest-earning deposits in other banks and Federal funds sold, increased to 3.13% for the nine months ended September 30, 2019, compared to 2.83% for the nine months ended September 30, 2018.

Total average loans (including nonaccrual), which generally yield higher rates than investment securities, increased $19,574,000, from $911,862,000 for the nine months ended September 30, 2018 to $931,436,000 for the nine months ended September 30, 2019. The effective yield on average loans increased to 5.58% for the nine months ended September 30, 2019, compared to 5.48% for the nine months ended September 30, 2018.

Total average assets for the nine months ended September 30, 2019 was $1,571,245,000 compared to $1,589,365,000 for the nine months ended September 30, 2018, a decrease of $18,120,000 or 1.14%. During the nine months ended September 30, 2019 and 2018, the loan-to-deposit ratio was 71.96% and 71.49%, respectively. Total average deposits decreased $56,006,000 or 4.16% to $1,289,192,000 for the nine months ended September 30, 2019, compared to $1,345,198,000 for the nine months ended September 30, 2018. Average interest-bearing deposits decreased $54,083,000, or 6.81%, and average non-interest bearing demand deposits decreased $1,923,000, or 0.35%, for the nine months ended September 30, 2019, compared to the nine months ended September 30, 2018. The Company’s ratio of average non-interest bearing deposits to total deposits was 42.60% for the nine months ended September 30, 2019, compared to 40.97% for the nine months ended September 30, 2018.

Non-interest income for the nine months ended September 30, 2019 increased by $3,376,000 to $11,296,000, compared to $7,920,000 for the nine months ended September 30, 2018, primarily driven by an increase of $3,919,000 in net realized gains on sales and calls of investment securities, and an increase in loan placement fees of $101,000, offset by decrease in gain on sale of credit card portfolio of $462,000, a decrease in service charge income of $145,000, and a decrease of $45,000 in other income.

Non-interest expense for the nine months ended September 30, 2019 increased $1,314,000, or 3.90%, to $34,972,000 compared to $33,658,000 for the nine months ended September 30, 2018. The net increase year over year resulted from increases in information technology of $1,376,000, salaries and employee benefits of $497,000, amortization of core deposit intangible of $240,000, directors’ expenses of $171,000, and telephone expenses of $120,000, offset by decreases in occupancy and equipment expenses of $355,000, regulatory assessments of $259,000, acquisition and integration expenses of $217,000, professional services of $133,000, and operating losses of $112,000 in 2019 compared to 2018. The increase in the information technology expenses was a result of the Company outsourcing its network maintenance and IT support during the fourth quarter of 2018. The increase in the directors’ expenses was related to the change in the discount rate used to calculate the liability for deferred compensation and split dollar plans. The decrease in regulatory assessments was the result of the Company receiving a portion of its small bank assessment credit. The FDIC automatically applies small bank assessment credits to offset regular deposit insurance assessments for assessment periods where the Deposit Insurance Fund (DIF) reserve ratio is at or above 1.38 percent.

The Company recorded an income tax provision of $6,790,000 for the nine months ended September 30, 2019, compared to $4,934,000 for the nine months ended September 30, 2018. The effective tax rate for the nine months September 30, 2019 was 28.55% compared to 23.56% for the nine months September 30, 2018. The increase in the effective rate was a result of a decrease in tax-exempt interest.

Quarter Ended September 30, 2019

For the quarter ended September 30, 2019, the Company reported unaudited consolidated net income of $5,691,000 and earnings per diluted common share of $0.42, compared to consolidated net income of $5,752,000 and $0.42 per diluted share for the same period in 2018. The decrease in net income during the third quarter of 2019 compared to the same period in 2018 was primarily due to an increase in the provision for income taxes of $625,000, an increase in total non-interest expenses of $743,000, and an increase in provision for credit losses of $250,000, offset by an increase in net interest income of $298,000, and an increase in non-interest income of $1,259,000. The effective tax rate increased to 30.11% from 24.11% for the quarters ended September 30, 2019 and September 30, 2018, respectively. Net income for the immediately trailing quarter ended June 30, 2019 was $6,087,000, or $0.45 per diluted common share.

Annualized return on average equity (ROE) for the third quarter of 2019 was 9.77%, compared to 10.80% for the same period of 2018. The decrease in ROE reflects decrease in net income, notwithstanding an increase in shareholders’ equity. Annualized return on average assets (ROA) was 1.43% for the third quarter of 2019 compared to 1.48% for the same period in 2018. This decrease is due to a decrease in net income notwithstanding an increase in average assets.

In comparing the third quarter of 2019 to the third quarter of 2018, average total loans increased by $34,388,000, or 3.76%. During the third quarter of 2019, the Company recorded net loan charge-offs of $160,000 compared to $(105,000) net loan recoveries for the same period in 2018. The net charge-off (recovery) ratio, which reflects annualized net charge-offs to average loans, was 0.07% for the quarter ended September 30, 2019 compared to (0.05)% for the quarter ended September 30, 2018.

Average total deposits for the third quarter of 2019 decreased $12,187,000 or 0.93% to $1,303,263,000 compared to $1,315,450,000 for the same period of 2018. In comparing the third quarter of 2019 to the third quarter of 2018, average borrowed funds increased $15,516,000 or 220.02% to $22,568,000 compared to $7,052,000.

The Company’s net interest margin (fully tax equivalent basis) was 4.50% for the quarter ended September 30, 2019, compared to 4.53% for the quarter ended September 30, 2018. Net interest income, before provision for credit losses, increased $298,000, or 1.87%, to $16,205,000 for the third quarter of 2019, compared to $15,907,000 for the same period in 2018. The accretion of the loan marks on acquired loans increased interest income by $299,000 and $316,000 during the quarters ended September 30, 2019 and 2018, respectively. Net interest income during the third quarters of 2019 and 2018 benefited by approximately $250,000 and $180,000, respectively, from prepayment penalties and payoff of loans previously on nonaccrual status. The net interest margin period-to-period comparisons were impacted by the increase in the yield on total interest-bearing liabilities; offset by an increase in the yield on the average investment securities and an increase in the yield on the loan portfolio. Over the same periods, the cost of total deposits increased to 0.17% from 0.10%.

For the quarter ended September 30, 2019, the Company’s average investment securities, including interest-earning deposits in other banks and Federal funds sold, decreased by $16,953,000, or 3.37%, compared to the quarter ended September 30, 2018, and decreased by $10,093,000, or 2.03%, compared to the quarter ended June 30, 2019.

The effective yield on average investment securities, including interest earning deposits in other banks and Federal funds sold, was 3.07% for the quarter ended September 30, 2019, compared to 3.05% for the quarter ended September 30, 2018 and 3.17% for the quarter ended June 30, 2019. Total average loans, which generally yield higher rates than investment securities, increased by $34,388,000 to $948,673,000 for the quarter ended September 30, 2019, from $914,285,000 for the quarter ended September 30, 2018 and increased by $9,618,000 from $939,055,000 for the quarter ended June 30, 2019. The effective yield on average loans was 5.55% for the quarter ended September 30, 2019, compared to 5.53% and 5.55% for the quarters ended September 30, 2018 and June 30, 2019, respectively.

Total average assets for the quarter ended September 30, 2019 were $1,588,367,000 compared to $1,555,704,000 for the quarter ended September 30, 2018 and $1,584,122,000 for the quarter ended June 30, 2019, an increase of $32,663,000 and an increase of $4,245,000, or 2.10% and 0.27%, respectively.

Total average deposits decreased $12,187,000, or 0.93%, to $1,303,263,000 for the quarter ended September 30, 2019, compared to $1,315,450,000 for the quarter ended September 30, 2018. Total average deposits increased $29,104,000, or 2.28%, for the quarter ended September 30, 2019, compared to $1,274,159,000 for the quarter ended June 30, 2019. The Company’s ratio of average non-interest bearing deposits to total deposits was 43.24% for the quarter ended September 30, 2019, compared to 42.09% and 42.45% for the quarters ended September 30, 2018 and June 30, 2019, respectively.

Non-interest income increased $1,259,000, or 51.12%, to $3,722,000 for the third quarter of 2019 compared to $2,463,000 for the same period in 2018. For the quarter ended September 30, 2019, non-interest income included $1,685,000 net realized gains on sales and calls of investment securities compared to net realized gains of $380,000 for the same period in 2018, a $1,305,000 increase. During the third quarter of 2019 loan placement fees increased $81,000, offset by a decrease in other income of $168,000, and a decrease in service charge income of $67,000, compared to the same period in 2018. Credit card deconversion costs, which were deducted from the net gain on the sale of the credit card portfolio, were $116,000 during the quarter ended September 30, 2018. Non-interest income for the quarter ended September 30, 2019 decreased by $876,000 to $3,722,000, compared to $4,598,000 for the quarter ended June 30, 2019. The decrease compared to the trailing quarter was primarily a $774,000 decrease in net realized gains on sales and calls of investment securities, a $41,000 decrease in service charges, and a $104,000 decrease in other income.

Non-interest expense for the quarter ended September 30, 2019 increased $743,000, or 6.89%, to $11,534,000 compared to $10,791,000 for the quarter ended September 30, 2018. The net increase quarter over quarter was a result of an increase of $428,000 in information technology expenses, an increase in salaries and employee benefits of $344,000, an increase of $119,000 in telephone expenses, an increase of $78,000 in ATM/debit card expenses, an increase of $80,000 in amortization of core deposit intangibles, an increase in professional services of $61,000, and an increase of $43,000 in Internet banking expenses, partially offset by a decrease of $223,000 in regulatory assessments and a decrease in occupancy and equipment expenses of $172,000. The increase in salaries and employee benefits was the result of changes in long-term interest rates used to calculate the liability for deferred compensation plans and resulted in an additional expense of $391,000 during the quarter.

Non-interest expense for the quarter ended September 30, 2019 decreased by $238,000 compared to $11,772,000 for the trailing quarter ended June 30, 2019. The decrease compared to the trailing quarter was primarily due to a decrease in regulatory assessments of $203,000, a decrease in salaries and employee benefits of $181,000, and a decrease in occupancy and equipment expense of $135,000, partially offset by a non-recurring $120,000 increase in telephone expenses, a $67,000 increase in provision for income taxes, and a $75,000 increase in other non-interest expenses. The decrease in salaries and employee benefits of $181,000 was the result of decreased salaries, benefits, and interest on deferred compensation plans as a result of the change in the discount rate used to calculate the liability.

The Company recorded an income tax provision of $2,452,000 for the quarter ended September 30, 2019, compared to $1,827,000 for the quarter ended September 30, 2018. The effective tax rate for the quarter ended September 30, 2019 was 30.11% compared to 24.11% for the same period in 2018. The increase in the effective tax rate was the result of a decrease in tax exempt interest.

Quarterly Dividend Announcement

On October 16, 2019, the Board of Directors of the Company declared a regular quarterly cash dividend of $0.11 per share on the Company’s common stock. The dividend is payable on November 15, 2019 to shareholders of record as of November 1, 2019.

Central Valley Community Bancorp trades on the NASDAQ stock exchange under the symbol CVCY. Central Valley Community Bank, headquartered in Fresno, California, was founded in 1979 and is the sole subsidiary of Central Valley Community Bancorp. Central Valley Community Bank operates 20 full-service offices throughout California’s San Joaquin Valley and Greater Sacramento Region. Additionally, the Bank maintains Commercial Real Estate, Agribusiness and SBA Lending Departments. Central Valley Investment Services are provided by Raymond James Financial, Inc.

Members of Central Valley Community Bancorp’s and the Bank’s Board of Directors are: Daniel J. Doyle (Chairman), Daniel N. Cunningham (Vice Chairman), Edwin S. Darden, Jr., F. T. “Tommy” Elliott, IV, James M. Ford, Robert J. Flautt, Gary D. Gall, Steven D. McDonald, Louis C. McMurray, Karen Musson, and William S. Smittcamp. Sidney B. Cox is Director Emeritus.

More information about Central Valley Community Bancorp and Central Valley Community Bank can be found at www.cvcb.com. Also, visit Central Valley Community Bank on Twitter and Facebook.

Forward-looking Statements - Certain matters discussed in this press release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained herein that are not historical facts, such as statements regarding the Company’s current business strategy and the Company’s plans for future development and operations, are based upon current expectations. These statements are forward-looking in nature and involve a number of risks and uncertainties. Such risks and uncertainties include, but are not limited to (1) significant increases in competitive pressure in the banking industry; (2) the impact of changes in interest rates; (3) a decline in economic conditions at the international, national or local level on the Company’s results of operations; (4) the Company’s ability to continue its internal growth at historical rates; (5) the Company’s ability to maintain its net interest margin; (6) the quality of the Company’s earning assets; (7) changes in the regulatory environment; (8) fluctuations in the real estate market; (9) changes in business conditions and inflation; (10) changes in securities markets; and (11) the other risks set forth in the Company’s reports filed with the Securities and Exchange Commission (“SEC”), including its Annual Report on Form 10-K for the year ended December 31, 2018. Therefore, the information set forth in such forward-looking statements should be carefully considered when evaluating the business prospects of the Company.

 

CENTRAL VALLEY COMMUNITY BANCORP

CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

 

 

September 30,

 

December 31,

 

September 30,

(In thousands, except share amounts)

 

2019

 

2018

 

2018

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

Cash and due from banks

 

$

38,344

 

 

$

24,954

 

 

$

29,748

 

Interest-earning deposits in other banks

 

4,603

 

 

6,725

 

 

17,528

 

Federal funds sold

 

90

 

 

48

 

 

31

 

Total cash and cash equivalents

 

43,037

 

 

31,727

 

 

47,307

 

Available-for-sale investment securities

 

469,927

 

 

463,905

 

 

434,697

 

Equity securities

 

7,507

 

 

7,254

 

 

7,184

 

Loans, less allowance for credit losses of $9,495, $9,104 and $9,025 at September 30, 2019, December 31, 2018, and September 30, 2018, respectively

 

933,008

 

 

909,591

 

 

902,852

 

Bank premises and equipment, net

 

7,804

 

 

8,484

 

 

8,869

 

Bank owned life insurance

 

30,047

 

 

28,502

 

 

28,329

 

Federal Home Loan Bank stock

 

6,062

 

 

6,843

 

 

6,843

 

Goodwill

 

53,777

 

 

53,777

 

 

53,777

 

Core deposit intangibles

 

2,051

 

 

2,572

 

 

2,746

 

Accrued interest receivable and other assets

 

30,907

 

 

25,181

 

 

26,822

 

Total assets

 

$

1,584,127

 

 

$

1,537,836

 

 

$

1,519,426

 

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

Non-interest bearing

 

$

572,736

 

 

$

550,657

 

 

$

534,636

 

Interest bearing

 

737,010

 

 

731,641

 

 

740,893

 

Total deposits

 

1,309,746

 

 

1,282,298

 

 

1,275,529

 

Short-term borrowings

 

5,000

 

 

10,000

 

 

 

Junior subordinated deferrable interest debentures

 

5,155

 

 

5,155

 

 

5,155

 

Accrued interest payable and other liabilities

 

31,044

 

 

20,645

 

 

25,307

 

Total liabilities

 

1,350,945

 

 

1,318,098

 

 

1,305,991

 

Shareholders’ equity:

 

 

 

 

 

 

Preferred stock, no par value; 10,000,000 shares authorized, none issued and outstanding

 

 

 

 

 

 

Common stock, no par value; 80,000,000 shares authorized; issued and outstanding: 13,301,395, 13,754,965, and 13,796,489, at September 30, 2019, December 31, 2018, and September 30, 2018, respectively

 

94,516

 

 

103,851

 

 

104,506

 

Retained earnings

 

132,935

 

 

120,294

 

 

116,255

 

Accumulated other comprehensive income (loss), net of tax

 

5,731

 

 

(4,407

)

 

(7,326

)

Total shareholders’ equity

 

233,182

 

 

219,738

 

 

213,435

 

Total liabilities and shareholders’ equity

 

$

1,584,127

 

 

$

1,537,836

 

 

$

1,519,426

 

 

CENTRAL VALLEY COMMUNITY BANCORP

CONSOLIDATED INCOME STATEMENTS

(Unaudited)

 

 

 

 

 

 

 

For the Three Months Ended,

 

For the Nine Months Ended

 

 

September 30,

 

June 30,

 

September 30,

 

September 30,

(In thousands, except share and per share amounts)

 

2019

 

2019

 

2018

 

2019

 

2018

INTEREST INCOME:

 

 

 

 

 

 

 

 

 

 

Interest and fees on loans

 

$

13,238

 

 

$

12,955

 

 

$

12,691

 

 

$

38,747

 

 

$

37,216

 

Interest on deposits in other banks

 

74

 

 

59

 

 

170

 

 

283

 

 

312

 

Interest and dividends on investment securities:

 

 

 

 

 

 

 

 

 

 

Taxable

 

3,462

 

 

3,337

 

 

2,533

 

 

9,821

 

 

7,277

 

Exempt from Federal income taxes

 

153

 

 

429

 

 

896

 

 

1,144

 

 

3,008

 

Total interest income

 

16,927

 

 

16,780

 

 

16,290

 

 

49,995

 

 

47,813

 

INTEREST EXPENSE:

 

 

 

 

 

 

 

 

 

 

Interest on deposits

 

566

 

 

469

 

 

320

 

 

1,428

 

 

810

 

Interest on junior subordinated deferrable interest debentures

 

51

 

 

55

 

 

52

 

 

163

 

 

147

 

Other

 

105

 

 

310

 

 

11

 

 

419

 

 

126

 

Total interest expense

 

722

 

 

834

 

 

383

 

 

2,010

 

 

1,083

 

Net interest income before provision for credit losses

 

16,205

 

 

15,946

 

 

15,907

 

 

47,985

 

 

46,730

 

PROVISION FOR CREDIT LOSSES

 

250

 

 

300

 

 

 

 

525

 

 

50

 

Net interest income after provision for credit losses

 

15,955

 

 

15,646

 

 

15,907

 

 

47,460

 

 

46,680

 

NON-INTEREST INCOME:

 

 

 

 

 

 

 

 

 

 

Service charges

 

672

 

 

713

 

 

739

 

 

2,075

 

 

2,220

 

Net realized gains (loss) on sale of credit card portfolio

 

 

 

 

 

(116

)

 

 

 

462

 

Appreciation in cash surrender value of bank owned life insurance

 

184

 

 

190

 

 

175

 

 

545

 

 

522

 

Interchange fees

 

374

 

 

384

 

 

381

 

 

1,101

 

 

1,106

 

Loan placement fees

 

288

 

 

220

 

 

207

 

 

647

 

 

546

 

Net realized gains on sales and calls of investment securities

 

1,685

 

 

2,459

 

 

380

 

 

5,196

 

 

1,277

 

Federal Home Loan Bank dividends

 

109

 

 

118

 

 

119

 

 

348

 

 

358

 

Other income

 

410

 

 

514

 

 

578

 

 

1,384

 

 

1,429

 

Total non-interest income

 

3,722

 

 

4,598

 

 

2,463

 

 

11,296

 

 

7,920

 

NON-INTEREST EXPENSES:

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

6,731

 

 

6,912

 

 

6,387

 

 

20,133

 

 

19,636

 

Occupancy and equipment

 

1,317

 

 

1,452

 

 

1,489

 

 

4,248

 

 

4,603

 

Professional services

 

404

 

 

280

 

 

343

 

 

1,011

 

 

1,144

 

Data processing expense

 

390

 

 

401

 

 

409

 

 

1,186

 

 

1,259

 

Directors’ expenses

 

184

 

 

193

 

 

158

 

 

552

 

 

381

 

ATM/Debit card expenses

 

270

 

 

186

 

 

192

 

 

647

 

 

569

 

Information technology

 

614

 

 

605

 

 

186

 

 

1,996

 

 

620

 

Regulatory assessments

 

(69

)

 

134

 

 

154

 

 

217

 

 

476

 

Advertising

 

190

 

 

198

 

 

192

 

 

590

 

 

569

 

Internet banking expenses

 

215

 

 

199

 

 

172

 

 

608

 

 

542

 

Amortization of core deposit intangibles

 

174

 

 

173

 

 

94

 

 

521

 

 

281

 

Other expense

 

1,114

 

 

1,039

 

 

1,015

 

 

3,263

 

 

3,578

 

Total non-interest expenses

 

11,534

 

 

11,772

 

 

10,791

 

 

34,972

 

 

33,658

 

Income before provision for income taxes

 

8,143

 

 

8,472

 

 

7,579

 

 

23,784

 

 

20,942

 

PROVISION FOR INCOME TAXES

 

2,452

 

 

2,385

 

 

1,827

 

 

6,790

 

 

4,934

 

Net income

 

$

5,691

 

 

$

6,087

 

 

$

5,752

 

 

$

16,994

 

 

$

16,008

 

 

 

 

 

 

 

 

 

 

 

 

Net income per common share:

 

 

 

 

 

 

 

 

 

 

Basic earnings per common share

 

$

0.43

 

 

$

0.45

 

 

$

0.42

 

 

$

1.26

 

 

$

1.17

 

Weighted average common shares used in basic computation

 

13,360,030

 

 

13,533,724

 

 

13,715,141

 

 

13,515,109

 

 

13,692,657

 

Diluted earnings per common share

 

$

0.42

 

 

$

0.45

 

 

$

0.42

 

 

$

1.25

 

 

$

1.16

 

Weighted average common shares used in diluted computation

 

13,450,187

 

 

13,635,834

 

 

13,836,828

 

 

13,615,552

 

 

13,821,828

 

Cash dividends per common share

 

$

0.11

 

 

$

0.11

 

 

$

0.08

 

 

$

0.32

 

 

$

0.22

 

 

CENTRAL VALLEY COMMUNITY BANCORP

CONDENSED CONSOLIDATED INCOME STATEMENTS

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

Sept. 30

 

Jun. 30

 

Mar. 31

 

Dec. 31,

 

Sept. 30

For the three months ended

 

2019

 

2019

 

2019

 

2018

 

2018

(In thousands, except share and per share amounts)

 

 

 

 

 

 

 

 

 

 

Net interest income

 

$

16,205

 

 

$

15,946

 

 

$

15,835

 

 

$

15,973

 

 

$

15,907

 

Provision for (reversal of) credit losses

 

250

 

 

300

 

 

(25

)

 

 

 

 

Net interest income after provision for credit losses

 

15,955

 

 

15,646

 

 

15,860

 

 

15,973

 

 

15,907

 

Total non-interest income

 

3,722

 

 

4,598

 

 

2,976

 

 

2,404

 

 

2,463

 

Total non-interest expense

 

11,534

 

 

11,772

 

 

11,667

 

 

11,410

 

 

10,791

 

Provision for income taxes

 

2,452

 

 

2,385

 

 

1,953

 

 

1,686

 

 

1,827

 

Net income

 

$

5,691

 

 

$

6,087

 

 

$

5,216

 

 

$

5,281

 

 

$

5,752

 

Basic earnings per common share

 

$

0.43

 

 

$

0.45

 

 

$

0.38

 

 

$

0.38

 

 

$

0.42

 

Weighted average common shares used in basic computation

 

13,360,030

 

 

13,533,724

 

 

13,646,489

 

 

13,721,087

 

 

13,715,141

 

Diluted earnings per common share

 

$

0.42

 

 

$

0.45

 

 

$

0.38

 

 

$

0.38

 

 

$

0.42

 

Weighted average common shares used in diluted computation

 

13,450,187

 

 

13,635,834

 

 

13,755,615

 

 

13,834,662

 

 

13,836,828

 

 

CENTRAL VALLEY COMMUNITY BANCORP

SELECTED RATIOS

(Unaudited)

 

 

 

Sept. 30,

 

Jun. 30,

 

Mar. 31,

 

Dec. 31,

 

Sept. 30,

As of and for the three months ended

 

2019

 

2019

 

2019

 

2018

 

2018

(Dollars in thousands, except per share amounts)

 

 

 

 

 

 

 

 

 

 

Allowance for credit losses to total loans

 

1.01

%

 

0.98

%

 

0.99

%

 

0.99

%

 

0.99

%

Non-performing assets to total assets

 

0.14

%

 

0.15

%

 

0.10

%

 

0.18

%

 

0.27

%

Total non-performing assets

 

$

2,157

 

 

$

2,442

 

 

$

1,548

 

 

$

2,740

 

 

$

4,133

 

Total nonaccrual loans

 

$

2,157

 

 

$

2,442

 

 

$

1,548

 

 

$

2,740

 

 

$

4,133

 

Net loan charge-offs (recoveries)

 

$

160

 

 

$

13

 

 

$

(39

)

 

$

(79

)

 

$

(105

)

Net charge-offs (recoveries) to average loans (annualized)

 

0.07

%

 

0.01

%

 

(0.02

)%

 

(0.03

)%

 

(0.05

)%

Book value per share

 

$

17.53

 

 

$

17.18

 

 

$

16.63

 

 

$

15.98

 

 

$

15.47

 

Tangible book value per share

 

$

13.33

 

 

$

13.02

 

 

$

12.52

 

 

$

11.87

 

 

$

11.37

 

Tangible common equity

 

$

177,354

 

 

$

175,678

 

 

$

171,279

 

 

$

163,389

 

 

$

156,911

 

Cost of total deposits

 

0.17

%

 

0.15

%

 

0.12

%

 

0.10

%

 

0.10

%

Interest and dividends on investment securities exempt from Federal income taxes

 

$

153

 

 

$

429

 

 

$

562

 

 

$

530

 

 

$

896

 

Net interest margin (calculated on a fully tax equivalent basis) (1)

 

4.50

%

 

4.50

%

 

4.63

%

 

4.55

%

 

4.53

%

Return on average assets (2)

 

1.43

%

 

1.54

%

 

1.35

%

 

1.37

%

 

1.48

%

Return on average equity (2)

 

9.77

%

 

10.68

%

 

9.42

%

 

9.82

%

 

10.80

%

Loan to deposit ratio

 

71.96

%

 

74.20

%

 

71.32

%

 

71.64

%

 

71.49

%

Efficiency ratio

 

62.07

%

 

63.64

%

 

63.92

%

 

60.80

%

 

58.65

%

Tier 1 leverage - Bancorp

 

11.47

%

 

11.43

%

 

11.69

%

 

11.48

%

 

11.16

%

Tier 1 leverage - Bank

 

11.36

%

 

11.36

%

 

11.64

%

 

11.32

%

 

11.06

%

Common equity tier 1 - Bancorp

 

14.84

%

 

14.72

%

 

15.13

%

 

15.13

%

 

15.17

%

Common equity tier 1 - Bank

 

15.13

%

 

15.08

%

 

15.50

%

 

15.38

%

 

15.51

%

Tier 1 risk-based capital - Bancorp

 

15.28

%

 

15.16

%

 

15.58

%

 

15.59

%

 

15.64

%

Tier 1 risk-based capital - Bank

 

15.13

%

 

15.08

%

 

15.50

%

 

15.38

%

 

15.51

%

Total risk-based capital - Bancorp

 

16.13

%

 

16.00

%

 

16.41

%

 

16.44

%

 

16.51

%

Total risk based capital - Bank

 

15.98

%

 

15.91

%

 

16.34

%

 

16.23

%

 

16.37

%

 (1)

Net Interest Margin is computed by dividing annualized quarterly net interest income by quarterly average interest-bearing assets.

 (2)

Computed by annualizing quarterly net income.

 

 

 

CENTRAL VALLEY COMMUNITY BANCORP

AVERAGE BALANCES AND RATES

(Unaudited)

 

 

 

For the Three Months Ended

 

For the Nine Months Ended

AVERAGE AMOUNTS

 

September 30,

 

June 30,

 

September 30,

 

September 30,

 

September 30,

(Dollars in thousands)

 

2019

 

2019

 

2018

 

2019

 

2018

Federal funds sold

 

$

82

 

 

$

119

 

 

$

22

 

 

$

102

 

 

$

39

 

Interest-bearing deposits in other banks

 

13,943

 

 

11,195

 

 

33,939

 

 

16,531

 

 

23,509

 

Investments

 

472,227

 

 

485,031

 

 

469,244

 

 

476,133

 

 

514,003

 

Loans (1)

 

946,136

 

 

936,602

 

 

910,164

 

 

928,874

 

 

907,779

 

Earning assets

 

1,432,388

 

 

1,432,947

 

 

1,413,369

 

 

1,421,640

 

 

1,445,330

 

Allowance for credit losses

 

(9,423

)

 

(9,234

)

 

(9,005

)

 

(9,261

)

 

(8,873

)

Nonaccrual loans

 

2,537

 

 

2,453

 

 

4,121

 

 

2,562

 

 

4,083

 

Other non-earning assets

 

162,865

 

 

157,956

 

 

147,219

 

 

156,304

 

 

148,825

 

Total assets

 

$

1,588,367

 

 

$

1,584,122

 

 

$

1,555,704

 

 

$

1,571,245

 

 

$

1,589,365

 

 

 

 

 

 

 

 

 

 

 

 

Interest bearing deposits

 

$

739,765

 

 

$

733,291

 

 

$

761,736

 

 

$

739,950

 

 

$

794,033

 

Other borrowings

 

22,568

 

 

53,952

 

 

7,052

 

 

27,490

 

 

14,203

 

Total interest-bearing liabilities

 

762,333

 

 

787,243

 

 

768,788

 

 

767,440

 

 

808,236

 

Non-interest bearing demand deposits

 

563,498

 

 

540,868

 

 

553,714

 

 

549,242

 

 

551,165

 

Non-interest bearing liabilities

 

29,459

 

 

28,078

 

 

20,174

 

 

27,012

 

 

19,914

 

Total liabilities

 

1,355,290

 

 

1,356,189

 

 

1,342,676

 

 

1,343,694

 

 

1,379,315

 

Total equity

 

233,077

 

 

227,933

 

 

213,028

 

 

227,551

 

 

210,050

 

Total liabilities and equity

 

$

1,588,367

 

 

$

1,584,122

 

 

$

1,555,704

 

 

$

1,571,245

 

 

$

1,589,365

 

 

 

 

 

 

 

 

 

 

 

 

AVERAGE RATES

 

 

 

 

 

 

 

 

 

 

Federal funds sold

 

2.15

%

 

2.40

%

 

1.95

%

 

2.32

%

 

1.79

%

Interest-earning deposits in other banks

 

2.12

%

 

2.11

%

 

1.99

%

 

2.28

%

 

1.77

%

Investments

 

3.10

%

 

3.20

%

 

3.13

%

 

3.16

%

 

2.88

%

Loans (3)

 

5.55

%

 

5.55

%

 

5.53

%

 

5.58

%

 

5.48

%

Earning assets

 

4.70

%

 

4.73

%

 

4.64

%

 

4.73

%

 

4.50

%

Interest-bearing deposits

 

0.30

%

 

0.26

%

 

0.17

%

 

0.26

%

 

0.14

%

Other borrowings

 

2.76

%

 

2.71

%

 

3.52

%

 

2.82

%

 

2.56

%

Total interest-bearing liabilities

 

0.38

%

 

0.42

%

 

0.20

%

 

0.35

%

 

0.18

%

Net interest margin (calculated on a fully tax equivalent basis) (2)

 

4.50

%

 

4.50

%

 

4.53

%

 

4.54

%

 

4.40

%

(1)

Average loans do not include nonaccrual loans.

(2)

Calculated on a fully tax equivalent basis, which includes Federal tax benefits relating to income earned on municipal bonds of $41, $114, and $238, for the three months ended September 30, 2019, June 30, 2019, and September 30, 2018, respectively. The Federal tax benefits relating to income earned on municipal bonds totaled $305 and $800 for the nine months ended September 30, 2019 and 2018, respectively.

(3)

Loan yield includes loan fees (costs) for the three months ended September 30, 2019, June 30, 2019, and September 30, 2018 of $72, $(42), and $176, respectively. Loan yield includes loan fees (costs) for the nine months ended September 30, 2019 and 2018 of $56 and $404, respectively.

 

 

Contacts

Investor Contact:
Dave Kinross
Executive Vice President and Chief Financial Officer
Central Valley Community Bancorp
559-323-3420

Media Contact:
Debbie Nalchajian-Cohen
Marketing Director
Central Valley Community Bancorp
559-222-1322

$Cashtags

Contacts

Investor Contact:
Dave Kinross
Executive Vice President and Chief Financial Officer
Central Valley Community Bancorp
559-323-3420

Media Contact:
Debbie Nalchajian-Cohen
Marketing Director
Central Valley Community Bancorp
559-222-1322