US Metro Bank Announces Third Quarter 2019 Financial Results

46% Annual Increase in Loans

40% Annual Increase in Deposits

GARDEN GROVE, Calif.--()--US Metro Bank (OTC Pink: USMT) Mr. Dong Il Kim, President and CEO, announced the bank’s financial results for the third quarter 2019, reporting year over year loan growth of $119.8 million or 46%. Deposits grew $126.5 million or 40% over the third quarter last year. The opening of the Bank’s Fullerton Branch in early December 2018 accounted for $74.3 million of the total deposit growth. The 46% loan growth from a year earlier helped the Net Interest Income increase $1.1 million or 29% for the third quarter compared to the third quarter a year earlier. SBA premium income recorded an increase over the same third quarter of last year increasing $569 thousand or 90% on higher SBA origination volumes during the third quarter 2019 compared to the third quarter a year earlier. Net income of $1,543,000 for the three months ending September 30, 2019 compares to $971,000 reported for the same three months in 2018, a year over year increase of $572 thousand or 59%. Earnings per share (EPS) of $0.10 per share on 16,230,000 shares for the quarter ended September 30, 2019 compares to EPS of $0.06 per share on 16,230,000 shares for the same time period in 2018.

The Bank reported total assets of $507.2 million as of September 30, 2019, representing a 36.8% increase compared to the reporting period ending September 30, 2018 and a 7.2% increase over the second quarter 2019. In 2017 the Bank opened a branch office on April 3, 2017 on Wilshire Boulevard in Koreatown, Los Angeles and a new branch in downtown Los Angeles’ Fashion District on November 1, 2017. On December 5, 2018 a fifth branch was opened in Buena Park (Fullerton Branch), California. As of September 30, 2019 the Wilshire branch recorded a total deposit base of $82.8 million including $15.6 million in non-interest bearing deposits. The Fashion District Branch had $72.7 million in total deposits at September 30, 2019 including $29.6 million in non-interest bearing deposits and the new Fullerton Branch recorded a deposit base of $74.3 million with $9.4 million in non-interest bearing deposits. Total Bank deposits ended the quarter at $442.1 million, a 40.0% increase from $315.6 million at September 30, 2018 and compares to $410.3 million at June 30, 2019, a 7.8% increase. Total Bank loans totaled $382.1 million compared to $262.3 million a year earlier at September 30, 2018, a 45.7% increase and increased from $324.9 million at June 30, 2019, a 17.6% increase. During the third quarter 2019 the Bank received all regulatory approvals to open its sixth branch in Torrance, California with an expected opening in late 2019.

SBA loan originations for the quarter ending September 30, 2019 were $25.1 million compared to $12.6 million for the second quarter in 2019. The Bank sold $18.9 million in SBA loans for a gain of $1.2 million for the quarter ended September 30, 2019 compared to $10.3 million in SBA loan sales and a gain of $0.6 million for the quarter ended September 30, 2018. During the first quarter 2019 the Bank opened its third SBA Loan Production Office (LPO) in New York City and in the second quarter the Bank opened its fourth SBA LPO in Atlanta, Georgia.

Loan quality remains good with non-performing assets as a percent of total assets of 0.04% compared to 0.13% as of September 30, 2018. The Bank had no Other Real Estate Owned at September 30, 2019. Allowance for loan and lease losses (ALLL) to gross loans has decreased from 1.44% as of September 30, 2018 to 1.26% as of September 30, 2019. The reason for the decrease is a 45.7% annual growth in loans from September 30, 2018. Accordingly the Bank booked $1.2 million of provision expense during 2019 as a result of the loan growth.

“The Board of Directors is pleased with the continued growth and profitability of the Bank while absorbing the additional investment expenses associated with the development of its new branches and loan production offices,” said CEO Kim. “We are excited about the planned growth of the Bank in 2019 and look forward to the continuing profitable deployment of our excess capital.”

US Metro Bank is a California chartered, full service commercial nonmember bank headquartered in Garden Grove, California with five branch offices in California - Garden Grove, Anaheim, Buena Park (Fullerton Branch), Koreatown/Los Angeles, Fashion District/Los Angeles and loan production offices in Dallas, Seattle, New York City and Atlanta. The Bank opened for business on September 15, 2006, and offers deposit and loan products (including commercial real estate, commercial and industrial and SBA loans), as well as related banking services to its targeted client base of executives, professionals, and small to medium-sized businesses, generally in the Southern California area.

This release contains forward-looking statements, including our expectations with respect to future events that are subject to various risks and uncertainties. Factors that could cause actual results to differ materially from management's projections, forecasts, estimates and expectations include: fluctuation in market rates of interest and loan and deposit pricing, adverse changes in the overall national economy as well as adverse economic conditions in our specific market areas, maintenance and development of well-established and valued client relationships and referral source relationships, and acquisition or loss of key production personnel. Other risks that can affect the Bank are detailed from time to time in our annual reports. We caution readers that the list of factors above is not exclusive. The forward-looking statements are made as of the date of this release, and we may not undertake steps to update the forward-looking statements to reflect the impact of any circumstances or events that arise after the date the forward-looking statements are made. In addition, our past results of operations are not necessarily indicative of future performance.

 
 
FINANCIAL HIGHLIGHTS (unaudited)
 
At or for the Three Months Ended

 

 

9/30/2019

 

6/30/2019

 

% Change

 

9/30/2018

 

% Change

Net Income

$

1,543

 

$

1,120

 

 

37.77

%

$

970

 

59.07

%

Net Income Per Share (Basic)

$

0.10

 

$

0.07

 

 

42.86

%

$

0.06

 

66.67

%

ROAA (Annualized)

 

1.26

%

 

0.98

%

 

0.28

%

 

1.08

%

0.18

%

ROAE (Annualized)

 

11.06

%

 

8.25

%

 

2.81

%

 

7.55

%

3.51

%

Assets

$

507,248

 

$

473,110

 

 

7.22

%

$

370,728

 

36.82

%

Gross Loans

$

382,091

 

$

324,922

 

 

17.59

%

$

262,285

 

45.68

%

Net Loans

$

377,269

 

$

320,640

 

 

17.66

%

$

258,517

 

45.94

%

Deposits

$

442,098

 

$

410,273

 

 

7.76

%

$

315,611

 

40.08

%

Non-Interest Bearing Deposits

$

112,854

 

$

85,714

 

 

31.66

%

$

71,266

 

58.36

%

Efficiency Ratio

 

57.26

%

 

63.89

%

 

-6.63

%

 

63.62

%

-6.36

%

Net Interest Margin

 

4.08

%

 

3.79

%

 

0.29

%

 

4.31

%

-0.23

%

 
 
BALANCE SHEET (unaudited)
(All amounts in thousands except per share information)
Assets 9/30/2019 9/30/2018 Y-O-Y Change
Cash and Due From Bank

$

13,757

 

$

11,417

 

$

2,340

 

 

20.5

%

Investments and Fed Funds Sold

$

101,641

 

$

90,767

 

 

10,874

 

 

12.0

%

Loans Outstanding

 

382,091

 

 

262,285

 

 

119,806

 

 

45.7

%

Loan Loss Reserve

 

(4,822

)

 

(3,768

)

 

(1,054

)

 

28.0

%

Other Assets

 

14,581

 

 

10,027

 

 

4,554

 

 

45.4

%

Total Assets

$

507,248

 

$

370,728

 

$

136,520

 

 

36.8

%

 
Liabilities and Capital 9/30/2019 9/30/2018 Y-O-Y Change
Deposits

$

442,098

 

$

315,611

 

$

126,487

 

 

40.1

%

Borrowings

 

5,437

 

 

1,500

 

 

3,937

 

 

262.5

%

Other Liabilities

 

3,203

 

 

1,811

 

 

1,392

 

 

76.9

%

Equity

 

56,510

 

 

51,806

 

 

4,704

 

 

9.1

%

Total Liabilities and Capital

$

507,248

 

$

370,728

 

$

136,520

 

 

36.8

%

 
STATEMENT OF OPERATIONS Three Months Ended
Income Statement 9/30/2019 9/30/2018 Q-O-Q Change
Interest Income

$

6,566

 

$

4,626

 

$

1,940

 

 

41.9

%

Interest Expense

 

1,778

 

 

911

 

 

867

 

 

95.2

%

Net Interest Income

 

4,788

 

 

3,715

 

 

1,073

 

 

28.9

%

Provision for Loan Losses

 

600

 

 

250

 

 

350

 

 

140.0

%

Other Income

 

1,749

 

 

1,048

 

 

701

 

 

66.9

%

Operating Expenses

 

3,743

 

 

3,030

 

 

713

 

 

23.5

%

Tax

 

651

 

 

512

 

 

139

 

 

27.1

%

Net Income

$

1,543

 

$

971

 

$

572

 

 

58.9

%

Net Income Per Share (Basic)

$

0.10

 

$

0.06

 

Ending Common Shares O/S

 

16,230,000

 

 

16,230,000

 

 
STATEMENT OF OPERATIONS Nine Months Ended
Income Statement 9/30/2019 9/30/2018 Y-O-Y Change
Interest Income

$

17,844

 

$

12,561

 

$

5,283

 

 

42.1

%

Interest Expense

 

4,803

 

 

2,226

 

 

2,577

 

 

115.8

%

Net Interest Income

 

13,041

 

 

10,335

 

 

2,706

 

 

26.2

%

Provision for Loan Losses

 

1,200

 

 

660

 

 

(540

)

 

N/A

 

Other Income

 

3,991

 

 

3,793

 

 

198

 

 

5.2

%

Operating Expenses

 

10,636

 

 

8,959

 

 

1,677

 

 

18.7

%

Tax

 

1,602

 

 

1,487

 

 

115

 

 

NM

 

Net Income*

$

3,594

 

$

3,022

 

$

1,652

 

 

54.7

%

Net Income Per Share (Basic)

$

0.22

 

$

0.19

 

Ending Common Shares O/S

 

16,230,000

 

 

16,230,000

 

 
Ratios 9/30/2019 9/30/2018 Y-O-Y Change
Net Loan to Deposits

 

85.34

%

 

81.91

%

 

3.43

%

ALLL/Gross Loans

 

1.26

%

 

1.44

%

 

-0.17

%

NPAs/Total Assets

 

0.04

%

 

0.13

%

 

-0.09

%

Tier One Leverage Ratio

 

11.19

%

 

13.81

%

 

-2.62

%

Book Value Per Share (Basic)

$3.48

 

$3.19

 

$0.29

 

YTD ROAA (annualized)

 

1.06

%

 

1.19

%

 

-0.13

%

YTD ROAE (annualized)

 

8.80

%

 

8.00

%

 

0.80

%

 

 

Contacts

Dong Il Kim
(714) 620-8888

Contacts

Dong Il Kim
(714) 620-8888