American Business Bank Announces Record Net Income in 2019

Net Interest Income increases 17% over prior year

Full Year 2019 Highlights

  • Total loans increased $237 million or 19%
  • Total deposits increased $191 million or 10%
  • Non-interest bearing demand deposits were 50% of total deposits
  • Nonperforming assets to total assets negligible at 0.09%
  • Continued status as well-capitalized, the highest regulatory category

Fourth Quarter 2019 Highlights

  • Net interest income increased by $1.4 million or 7% over the prior year quarter
  • Net organic loan growth of $58 million or 16% annualized
  • Deposit growth of $66 million or 12% annualized
  • Cost of deposits at 0.24%

LOS ANGELES--()--AMERICAN BUSINESS BANK (OTCQX: AMBZ) today reported record net income for the full year 2019 of $22.1 million or $2.73 per fully diluted share compared to $16.4 million or $2.09 per fully diluted share for the full year 2018, an increase of 35%. The increase was due to significant loan and core deposit growth in 2018 and 2019 resulting in increased net interest income.

“The Bank’s strong growth in 2019 and the transformational increases of 2018 resulted in the highest net income in the Bank’s history. Leveraging new back office technology in 2020 and moving into our new headquarters this last year will facilitate future efficient growth. The Bank is well positioned to keep its eye on the long game and grow with our customers,” said Leon Blankstein, AMBZ’s President, CEO and Director.

“Loan growth in the fourth quarter of 2019 was centered in relationship driven C&I and commercial real estate loans, a result of our discipline and commitment to our proven business model. We always stick to the fundamentals in all of our actions and put the needs of our customers first. Our reward is an extremely loyal and growing customer community, a stable core deposit base, and a group of talented bankers who, by their intentions and their actions, provide the Bank with a competitive advantage,” continued Mr. Blankstein.

For the quarter ended December 31, 2019, net income was $6.0 million or $0.74 per fully diluted share, compared with net income of $6.1 million or $0.77 per fully diluted share for the fourth quarter of 2018. Net interest income increased $1.4 million or 7% due to the strong loan growth funded by core deposit growth. However, non-interest expense for the fourth quarter of 2018 included a $1.6 million deferred compensation plan (DCP) benefit related to the AMBZ stock fund compared to none in the fourth quarter of 2019. The change in 2019 to the Bank’s DCP created capital and reduced income volatility. Beginning June 1, 2019, the Bank is no longer required to mark-to-market its DCP obligation related to the AMBZ stock fund. Excluding this benefit in 2018, net income increased $1.1 million, or 22% from fourth quarter of 2018 to 2019.

Net income for the fourth quarter of 2019 was $6.0 million or $0.74 per fully diluted share, compared with $5.4 million or $0.67 per fully diluted share for the third quarter of 2019. Net interest income for the fourth quarter was flat compared to the third quarter of 2019 as solid loan growth was offset by the effect of lower interest rates, while the cost of deposits remained at 0.24%. Further, the provision for loan losses was lower commensurate with the loan growth during the fourth quarter of 2019 to maintain the allowance for loan losses at 1.4% of loans.

Net Interest Margin

The Bank’s net interest margin for 2019 was 3.58%, compared to 3.41% in the previous year, an increase of 0.17%. This was primarily due to average loans being a higher percentage of average earnings assets in 2019 than in 2018 and an expansion in average loan yields of 0.19%. The loan to deposit ratio increased to 69% at December 31, 2019 from 63% at December 31, 2018. The net interest margin benefited from non-interest bearing deposits growing more than interest bearing deposits.

On a quarterly basis, the Bank’s net interest margin for the fourth quarter of 2019 was 3.43%, compared to 3.53% for the fourth quarter of 2018, a decrease of 0.10%. This was due to a reduction in yields on loans and SBA securities primarily from the three prime rate cuts in 2019. Additionally, a new accounting standard adopted on January 1, 2019 requires a shorter amortization period for municipal securities purchased at a premium. This change accelerated premium amortization and reduced yields on the municipal portfolio in 2019. The cost of deposits increased 0.06% for the periods compared.

The Bank’s net interest margin for the fourth quarter of 2019 was 3.43%, compared to 3.66% in the third quarter of 2019, a decrease of 0.23%. This was due to a reduction in yields on loans and securities primarily from the three prime rate cuts in 2019. During the quarter, the yield on new loan production declined to 4.24% and the yield on SBA securities declined to 1.04% as rising prepayment speeds led to higher premium amortization on the securities. The cost of deposits remained unchanged at 0.24%.

Non-Interest Income

Non-interest income in 2019 was $5.7 million, an increase of $1.8 million, or 46% from $3.9 million in the prior year. The increase is attributable to a $488,000 increase in Deposits and International Fees due to growth in commercial business customers and a $360,000 reduction in realized losses on the sale of investment securities. Bank owned life insurance (BOLI) income increased $740,000, which is driven by the increase in the value of BOLI and COLI policies that are invested in mutual funds. Interchange income from credit cards, which is included in other non-interest income, increased by $292,000 and the gain on sale of SBA loans declined $495,000 as the Bank has started to portfolio certain SBA loans in 2019.

Non-interest income in the fourth quarter of 2019 was $1.6 million. This compares to $646,000 in the fourth quarter of 2018 and $1.3 million for the third quarter of 2019. The increase is mainly due to the positive change in the value of BOLI and COLI policies for the periods compared.

Non-Interest Expense

Non-interest expense for 2019 increased $5.3 million, or 12% compared to the prior year due to a $3.8 million increase in salaries and employee benefits expense, $1.1 million increase in professional services expense and a $685,000 increase in occupancy and equipment expense. The increase in salaries and employee benefits was attributable to a $2.6 million increase in DCP expense related to the AMBZ stock fund and other measurement funds, and a larger workforce. The increase in occupancy and equipment expense was primarily due to a full year of lease expense for the new Los Angeles headquarters in 2019. Despite the increase in non-interest expense, the efficiency ratio decreased to 60% for 2019 from 64% for 2018.

Non-interest expense increased $3.2 million or 34% for the quarter ended December 31, 2019 compared to the same quarter a year ago. The increase was predominantly due to a $3.0 million increase in salaries and employee benefits expense. The increase was attributable to a $2.0 million DCP benefit recorded in the fourth quarter of 2018 primarily related to the decline in the Bank’s stock price, compared to a $275,000 DCP expense related to the other measurement funds recorded in the fourth quarter of 2019. As of June 1, 2019, the Bank is no longer required to mark-to-market its DCP obligation related to the AMBZ stock fund. The remaining increase in non-interest expense was driven by a larger workforce. The efficiency ratio was 59% for the fourth quarter of 2019.

Compared to the third quarter of 2019, non-interest expense increased $76,000 primarily due to a $561,000 increase in salaries and employee benefits offset by a $520,000 decrease in professional services expense primarily from lower legal services expense. The efficiency ratio remained at 59% for the fourth quarter of 2019 compared to the prior quarter.

Full time equivalent employees at December 31, 2019 were 195 compared to 191 a year ago, and the same as September 30, 2019. The Bank now has 30 relationship managers in seven offices.

Balance Sheet

Total assets increased $244 million, or 11% from December 31, 2018 to $2.4 billion. Total loans increased $237 million to $1.5 billion, or 19% primarily in owner occupied commercial real estate and C&I. This resulted in an increase in the loan to deposit ratio to 69% from 63% during the year. In the fourth quarter of 2019, loans and deposits grew by $58 million and $66 million, respectively. At December 31, 2019, non-interest bearing deposits represented 50% of total deposits, the same as December 31, 2018.

Asset quality at December 31, 2019 remains excellent with non-performing assets to total assets of 0.09%, $1.9 million in non-performing loans, and no Other Real Estate Owned (OREO). The largest non-accrual loan is $1.5 million and is fully secured by real estate with no specific allowance. At the end of the year, the allowance for loan losses stood at $20.1 million, or 1.4% of total loans. During 2019, the Bank had no charge offs.

ABOUT AMERICAN BUSINESS BANK

American Business Bank, headquartered in downtown Los Angeles, offers a wide range of financial services to the business marketplace. Clients include wholesalers, manufacturers, service businesses, professionals and non-profits. American Business Bank has six Loan Production Offices in strategic locations including: North Orange County in Anaheim, Orange County in Irvine, South Bay in Torrance, San Fernando Valley in Woodland Hills, Riverside County in Corona and Inland Empire in Ontario.

FORWARD-LOOKING STATEMENTS

This communication contains certain forward-looking information about American Business Bank that is intended to be covered by the safe harbor for “forward-looking statements” provided by the Private Securities Litigation Reform Act of 1995. Such statements include future financial and operating results, expectations, intentions and other statements that are not historical facts. Such statements are based on information available at the time of this communication and are based on current beliefs and expectations of the Bank’s management and are subject to significant risks, uncertainties and contingencies, many of which are beyond our control. Actual results may differ materially from those set forth in the forward-looking statements due to a variety of factors, including various risk factors. We are under no obligation (and expressly disclaim any such obligation) to update or alter our forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

American Business Bank
Figures in $000, except share and per share amounts
 
BALANCE SHEETS (unaudited)

December

 

September

 

December

2019

 

2019

 

2018

Assets:
Cash and Due from Banks

$

31,673

 

$

88,211

 

$

26,673

 

Interest Earning Deposits in Other Financial Institutions

 

45,202

 

 

26,077

 

 

76,599

 

 
Investment Securities:
US Agencies

 

284,032

 

 

305,572

 

 

440,212

 

Mortgage Backed Securities

 

292,126

 

 

226,338

 

 

128,851

 

State and Municipals

 

78,520

 

 

74,824

 

 

77,460

 

US Treasuries

 

10,009

 

 

9,992

 

 

9,859

 

Corporate Bonds

 

19,805

 

 

19,861

 

 

1,971

 

Securities Available-for-Sale, at Fair Value

 

684,492

 

 

636,587

 

 

658,353

 

State and Municipals Securities Held-to-Maturity, at Amortized Cost

 

86,707

 

 

86,915

 

 

87,526

 

Federal Home Loan Bank Stock, at Cost

 

10,356

 

 

10,356

 

 

10,356

 

Total Investment Securities

 

781,555

 

 

733,858

 

 

756,235

 

Loans Receivable:
Commercial Real Estate

 

982,070

 

 

954,424

 

 

827,388

 

Commercial and Industrial

 

423,868

 

 

402,167

 

 

356,583

 

Residential Real Estate

 

76,481

 

 

68,259

 

 

62,835

 

Installment and Other

 

4,959

 

 

4,765

 

 

3,455

 

Total Loans Receivable

 

1,487,378

 

 

1,429,615

 

 

1,250,261

 

Allowance for Loan Losses

 

(20,824

)

 

(20,014

)

 

(17,503

)

Loans Receivable, Net

 

1,466,554

 

 

1,409,601

 

 

1,232,758

 

Furniture, Equipment and Leasehold Improvements, Net

 

9,023

 

 

8,700

 

 

1,834

 

Bank/Corporate Owned Life Insurance

 

26,448

 

 

26,110

 

 

25,328

 

Other Assets

 

41,456

 

 

39,087

 

 

38,016

 

Total Assets

$

2,401,911

 

$

2,331,644

 

$

2,157,443

 

 
Liabilities:
Non-Interest Bearing Demand Deposits

$

1,083,705

 

$

1,084,152

 

$

983,284

 

Interest Bearing Transaction Accounts

 

215,730

 

 

221,196

 

 

211,794

 

Money Market and Savings Deposits

 

827,713

 

 

751,415

 

 

728,237

 

Certificates of Deposit

 

37,712

 

 

42,555

 

 

50,443

 

Total Deposits

 

2,164,860

 

 

2,099,318

 

 

1,973,758

 

Federal Home Loan Bank Advances / Other Borrowings

 

-

 

 

-

 

 

-

 

Other Liabilities

 

30,386

 

 

31,258

 

 

18,618

 

Total Liabilities

$

2,195,246

 

$

2,130,576

 

$

1,992,376

 

 
Shareholders' Equity:
Common Stock

$

163,872

 

$

163,464

 

$

154,710

 

Retained Earnings

 

46,784

 

 

40,795

 

 

27,454

 

Accumulated Other Comprehensive Income / (Loss)

 

(3,991

)

 

(3,191

)

 

(17,097

)

Total Shareholders' Equity

$

206,665

 

$

201,068

 

$

165,067

 

Total Liabilities and Shareholders' Equity

$

2,401,911

 

$

2,331,644

 

$

2,157,443

 

 
Standby Letters of Credit

$

39,513

 

$

39,722

 

$

36,411

 

 
Per Share Information:
Common Shares Outstanding

 

7,850,171

 

 

7,834,279

 

 

7,705,590

 

Book Value Per Share

$

26.33

 

$

25.67

 

$

21.42

 

Tangible Book Value Per Share

$

26.33

 

$

25.67

 

$

21.42

 

 
American Business Bank
Figures in $000, except share and per share amounts
 
INCOME STATEMENTS (unaudited)

For the three months ended:

December

 

September

 

December

2019

 

2019

 

2018

Interest Income:
Interest and Fees on Loans

$

17,021

$

16,890

 

$

14,124

 

Interest on Investment Securities

 

3,942

 

4,260

 

 

4,747

 

Interest on Interest Earning Deposits in Other Financial Institutions

 

530

 

332

 

 

868

 

Total Interest Income

 

21,493

 

21,482

 

 

19,739

 

 
Interest Expense:
Interest on Interest Bearing Transaction Accounts

 

154

 

152

 

 

110

 

Interest on Money Market and Savings Deposits

 

1,114

 

1,041

 

 

725

 

Interest on Certificates of Deposits

 

45

 

73

 

 

97

 

Interest on Federal Home Loan Bank Advances and Other Borrowings

 

-

 

1

 

 

1

 

Total Interest Expense

 

1,313

 

1,267

 

 

933

 

 
Net Interest Income

 

20,180

 

20,215

 

 

18,806

 

Provision for Loan Losses

 

801

 

1,460

 

 

1,543

 

Net Interest Income after Provision for Loan Losses

 

19,379

 

18,755

 

 

17,263

 

 
Non-Interest Income:
Deposit Fees

 

562

 

553

 

 

505

 

International Fees

 

319

 

328

 

 

281

 

Gain (Loss) on Sale of Investment Securities, Net

 

-

 

(122

)

 

(74

)

Gain on Sale of SBA Loans, Net

 

65

 

87

 

 

141

 

Bank/Corporate Owned Life Insurance Income

 

338

 

135

 

 

(323

)

Other

 

290

 

352

 

 

116

 

Total Non-Interest Income

 

1,574

 

1,333

 

 

646

 

 
Non-Interest Expense:
Salaries and Employee Benefits

 

9,005

 

8,444

 

 

5,959

 

Occupancy and Equipment

 

982

 

888

 

 

792

 

Professional Services

 

1,426

 

1,946

 

 

1,269

 

Promotion Expenses

 

425

 

361

 

 

402

 

Other

 

946

 

1,069

 

 

1,130

 

Total Non-Interest Expense

 

12,784

 

12,708

 

 

9,552

 

 
Earnings before income taxes

 

8,169

 

7,380

 

 

8,357

 

Income Tax Expense

 

2,179

 

1,963

 

 

2,262

 

 
NET INCOME

$

5,990

$

5,417

 

$

6,095

 

Add back:
After-Tax Gain (Loss) on Sale of Investment Securities, Net

$

-

$

90

 

$

54

 

After-Tax DCP ABB Stock Expense (Benefit)

$

-

$

-

 

$

(1,199

)

Core Net Income

$

5,990

$

5,507

 

$

4,950

 

 
Per Share Information:
Earnings Per Share - Basic

$

0.75

$

0.68

 

$

0.79

 

 
Earnings Per Share - Diluted

$

0.74

$

0.67

 

$

0.77

 

Core Earnings Per Share - Diluted

$

0.74

$

0.68

 

$

0.63

 

 
Weighted Average Shares - Basic

 

8,019,772

 

7,999,146

 

 

7,700,091

 

 
Weighted Average Shares - Diluted

 

8,117,068

 

8,100,992

 

 

7,881,465

 

 
American Business Bank
Figures in $000, except share and per share amounts
 
INCOME STATEMENTS (unaudited)

For the twelve months ended:

December

 

December

2019

 

2018

Interest Income:
Interest and Fees on Loans

$

64,835

 

$

49,738

 

Interest on Investment Securities

 

16,620

 

 

19,007

 

Interest on Interest Earning Deposits in Other Financial Institutions

 

1,628

 

 

1,420

 

Total Interest Income

 

83,083

 

 

70,165

 

 
Interest Expense:
Interest on Interest Bearing Transaction Accounts

 

516

 

 

374

 

Interest on Money Market and Savings Deposits

 

3,918

 

 

2,100

 

Interest on Certificates of Deposits

 

339

 

 

331

 

Interest on Federal Home Loan Bank Advances and Other Borrowings

 

15

 

 

329

 

Total Interest Expense

 

4,788

 

 

3,134

 

 
Net Interest Income

 

78,295

 

 

67,031

 

Provision for Loan Losses

 

3,279

 

 

3,811

 

Net Interest Income after Provision for Loan Losses

 

75,016

 

 

63,220

 

 
Non-Interest Income:
Deposit Fees

 

2,160

 

 

1,899

 

International Fees

 

1,159

 

 

932

 

Gain (Loss) on Sale of Investment Securities, Net

 

(267

)

 

(627

)

Gain on Sale of SBA Loans, Net

 

391

 

 

886

 

Bank/Corporate Owned Life Insurance Income

 

1,120

 

 

380

 

Other

 

1,156

 

 

453

 

Total Non-Interest Income

 

5,719

 

 

3,923

 

 
Non-Interest Expense:
Salaries and Employee Benefits

 

35,466

 

 

31,674

 

Occupancy and Equipment

 

3,938

 

 

3,253

 

Professional Services

 

5,766

 

 

4,658

 

Promotion Expenses

 

1,371

 

 

1,336

 

Other

 

4,270

 

 

4,583

 

Total Non-Interest Expense

 

50,811

 

 

45,504

 

 
Earnings before income taxes

 

29,924

 

 

21,639

 

Income Tax Expense

 

7,847

 

 

5,246

 

 
NET INCOME

$

22,077

 

$

16,393

 

Add back:
After-Tax Net Gains (Losses) on Sale of Investment Securities

$

197

 

$

475

 

After-Tax DCP ABB Stock Expense (Benefit)

$

448

 

$

(890

)

Core Net Income

$

22,722

 

$

15,978

 

 
Per Share Information:
Earnings Per Share - Basic

$

2.77

 

$

2.15

 

 
Earnings Per Share - Diluted

$

2.73

 

$

2.09

 

Core Earnings Per Share - Diluted

$

2.81

 

$

2.03

 

 
Weighted Average Shares - Basic

 

7,966,417

 

 

7,642,390

 

 
Weighted Average Shares - Diluted

 

8,088,164

 

 

7,860,712

 

 
American Business Bank
Figures in $000
 
QUARTERLY AVERAGE BALANCE SHEETS AND YIELD ANALYSIS (unaudited)
For the three months ended:
December 2019 September 2019
Average Interest Average Average Interest Average
Balance Inc/Exp Yield/Rate Balance Inc/Exp Yield/Rate
Interest Earning Assets:
Interest Earning Deposits in Other Financial Institutions

$

123,977

$

530

1.73

%

$

58,676

$

332

2.30

%

 
Investment Securities:
US Agencies

 

297,971

 

774

1.04

%

 

351,204

 

1,406

1.60

%

Mortgage Backed Securities

 

258,469

 

1,700

2.63

%

 

208,820

 

1,422

2.72

%

State and Municipals

 

163,437

 

1,094

2.68

%

 

163,734

 

1,094

2.67

%

US Treasuries

 

10,032

 

37

1.46

%

 

10,039

 

37

1.46

%

Corporate Bonds

 

19,942

 

151

3.02

%

 

15,328

 

118

3.07

%

Securities Available-for-Sale and Held-to-Maturity

 

749,851

 

3,756

2.00

%

 

749,125

 

4,077

2.18

%

Federal Home Loan Bank Stock

 

10,356

 

186

7.18

%

 

10,356

 

183

7.05

%

Total Investment Securities

 

760,207

 

3,942

2.07

%

 

759,481

 

4,260

2.24

%

Loans Receivable:
Commercial Real Estate

 

969,700

 

11,232

4.60

%

 

917,398

 

10,957

4.74

%

Commercial and Industrial

 

399,926

 

4,839

4.80

%

 

385,315

 

4,996

5.14

%

Residential Real Estate

 

72,137

 

894

4.92

%

 

66,512

 

891

5.32

%

Installment and Other

 

5,413

 

56

4.11

%

 

5,159

 

46

3.58

%

Total Loans Receivable

 

1,447,176

 

17,021

4.67

%

 

1,374,384

 

16,890

4.88

%

Total Interest Earning Assets

$

2,331,360

$

21,493

3.61

%

$

2,192,541

$

21,482

3.83

%

 
Liabilities:
Non-Interest Bearing Demand Deposits

 

1,118,736

 

-

0.00

%

 

1,059,710

 

-

0.00

%

Interest Bearing Transaction Accounts

 

216,134

 

154

0.28

%

 

208,403

 

152

0.29

%

Money Market and Savings Deposits

 

823,561

 

1,114

0.54

%

 

746,947

 

1,041

0.55

%

Certificates of Deposit

 

38,339

 

45

0.47

%

 

50,425

 

73

0.57

%

Total Deposits

 

2,196,770

 

1,313

0.24

%

 

2,065,485

 

1,266

0.24

%

Federal Home Loan Bank Advances / Other Borrowings

 

-

 

-

0.00

%

 

163

 

1

2.27

%

Total Interest Bearing Deposits and Borrowings

 

1,078,034

 

1,313

0.48

%

 

1,005,938

 

1,267

0.50

%

Total Deposits and Borrowings

$

2,196,770

$

1,313

0.24

%

$

2,065,647

$

1,267

0.24

%

 
Net Interest Income

$

20,180

$

20,215

Net Interest Rate Spread

3.37

%

3.59

%

Net Interest Margin

3.43

%

3.66

%

 
American Business Bank
Figures in $000
 
QUARTERLY AVERAGE BALANCE SHEETS AND YIELD ANALYSIS (unaudited)
For the three months ended:
December 2019 December 2018
Average Interest Average Average Interest Average
Balance Inc/Exp Yield/Rate Balance Inc/Exp Yield/Rate
Interest Earning Assets:
Interest Earning Deposits in Other Financial Institutions

$

123,977

$

530

1.73

%

$

150,483

$

868

2.34

%

 
Investment Securities:
US Agencies

 

297,971

 

774

1.04

%

 

459,879

 

1,886

1.64

%

Mortgage Backed Securities

 

258,469

 

1,700

2.63

%

 

137,272

 

957

2.79

%

State and Municipals

 

163,437

 

1,094

2.68

%

 

174,603

 

1,492

3.42

%

US Treasuries

 

10,032

 

37

1.46

%

 

10,059

 

37

1.46

%

Corporate Bonds

 

19,942

 

151

3.02

%

 

2,000

 

17

3.41

%

Securities Available-for-Sale and Held-to-Maturity

 

749,851

 

3,756

2.00

%

 

783,813

 

4,389

2.24

%

Federal Home Loan Bank Stock

 

10,356

 

186

7.18

%

 

10,356

 

358

13.83

%

Total Investment Securities

 

760,207

 

3,942

2.07

%

 

794,169

 

4,747

2.39

%

Loans Receivable:
Commercial Real Estate

 

969,700

 

11,232

4.60

%

 

782,799

 

9,164

4.64

%

Commercial and Industrial

 

399,926

 

4,839

4.80

%

 

317,882

 

4,031

5.03

%

Residential Real Estate

 

72,137

 

894

4.92

%

 

62,307

 

819

5.21

%

Installment and Other

 

5,413

 

56

4.11

%

 

4,245

 

110

10.32

%

Total Loans Receivable

 

1,447,176

 

17,021

4.67

%

 

1,167,233

 

14,124

4.80

%

Total Interest Earning Assets

$

2,331,360

$

21,493

3.61

%

$

2,111,885

$

19,739

3.66

%

 
Liabilities:
Non-Interest Bearing Demand Deposits

 

1,118,736

 

-

0.00

%

 

1,029,346

 

-

0.00

%

Interest Bearing Transaction Accounts

 

216,134

 

154

0.28

%

 

197,465

 

110

0.22

%

Money Market and Savings Deposits

 

823,561

 

1,114

0.54

%

 

712,486

 

725

0.40

%

Certificates of Deposit

 

38,339

 

45

0.47

%

 

64,269

 

97

0.60

%

Total Deposits

 

2,196,770

 

1,313

0.24

%

 

2,003,566

 

932

0.18

%

Federal Home Loan Bank Advances / Other Borrowings

 

-

 

-

0.00

%

 

402

 

1

1.48

%

Total Interest Bearing Deposits and Borrowings

 

1,078,034

 

1,313

0.48

%

 

974,622

 

933

0.38

%

Total Deposits and Borrowings

$

2,196,770

$

1,313

0.24

%

$

2,003,969

$

933

0.18

%

 
Net Interest Income

$

20,180

$

18,806

Net Interest Rate Spread

3.37

%

3.48

%

Net Interest Margin

3.43

%

3.53

%

 
American Business Bank
Figures in $000
 
YEAR-TO-DATE AVERAGE BALANCE SHEETS AND YIELD ANALYSIS (unaudited)
For the twelve months ended:
December 2019 December 2018
Average Interest Average Average Interest Average
Balance Inc/Exp Yield/Rate Balance Inc/Exp Yield/Rate
Interest Earning Assets:
Interest Earning Deposits with Other Financial Institutions

$

77,077

$

1,628

2.14

%

$

66,602

$

1,420

2.16

%

 
Investment Securities:
US Agencies

 

370,925

 

5,386

1.45

%

 

515,083

 

8,740

1.70

%

Mortgage Backed Securities

 

202,087

 

5,603

2.77

%

 

108,563

 

2,975

2.74

%

State and Municipals

 

165,757

 

4,445

2.68

%

 

179,656

 

6,188

3.44

%

US Treasuries

 

10,042

 

148

1.47

%

 

10,069

 

148

1.47

%

Corporate Bonds

 

10,061

 

310

3.08

%

 

2,087

 

65

3.13

%

Securities Available-for-Sale and Held-to-Maturity

 

758,872

 

15,892

2.09

%

 

815,458

 

18,116

2.22

%

Federal Home Loan Bank Stock

 

10,356

 

728

7.03

%

 

10,231

 

891

8.71

%

Total Investment Securities

 

769,228

 

16,620

2.16

%

 

825,689

 

19,007

2.30

%

Loans Receivable:
Commercial Real Estate

 

897,530

 

42,135

4.69

%

 

722,717

 

32,851

4.55

%

Commercial and Industrial

 

374,634

 

19,146

5.11

%

 

282,141

 

13,380

4.74

%

Residential Real Estate

 

64,769

 

3,381

5.22

%

 

63,688

 

3,171

4.98

%

Installment and Other

 

5,065

 

173

3.42

%

 

3,779

 

338

8.91

%

Total Loans Receivable

 

1,341,998

 

64,835

4.83

%

 

1,072,325

 

49,738

4.64

%

Total Interest Earning Assets

$

2,188,303

$

83,083

3.74

%

$

1,964,616

$

70,165

3.52

%

 
Liabilities:
Non-Interest Bearing Demand Deposits

 

1,045,715

 

-

0.00

%

 

941,057

 

-

0.00

%

Interest Bearing Transaction Accounts

 

205,551

 

516

0.25

%

 

188,101

 

374

0.20

%

Money Market and Savings Deposits

 

757,833

 

3,918

0.52

%

 

650,134

 

2,100

0.32

%

Certificates of Deposit

 

55,673

 

339

0.61

%

 

63,085

 

331

0.53

%

Total Deposits

 

2,064,772

 

4,773

0.23

%

 

1,842,377

 

2,805

0.15

%

Federal Home Loan Bank Advances / Other Borrowings

 

552

 

15

2.63

%

 

20,037

 

329

1.64

%

Total Interest Bearing Deposits and Borrowings

 

1,019,609

 

4,788

0.47

%

 

921,357

 

3,134

0.34

%

Total Deposits and Borrowings

$

2,065,324

$

4,788

0.23

%

$

1,862,414

$

3,134

0.17

%

 
Net Interest Income

$

78,295

$

67,031

Net Interest Rate Spread

3.51

%

3.35

%

Net Interest Margin

3.58

%

3.41

%

 
American Business Bank
Figures in $000
 
SUPPLEMENTAL DATA (unaudited)

December

 

September

 

December

2019

 

2019

 

2018

Performance Ratios:
Quarterly:
Return on Average Assets (ROAA)

 

0.99

%

 

0.95

%

 

1.12

%

Core Return on Average Assets (ROAA)  

 

0.99

%

 

0.96

%

 

0.91

%

 
Return on Average Equity (ROAE)

 

11.74

%

 

11.03

%

 

15.52

%

Core Return on Average Equity (ROAE)  

 

11.74

%

 

11.22

%

 

12.61

%

 
Efficiency Ratio

 

58.77

%

 

58.64

%

 

48.92

%

Core Efficiency Ratio

 

58.77

%

 

58.64

%

 

57.34

%

 
Year-to-Date:
Return on Average Assets (ROAA)

 

0.97

%

 

0.96

%

 

0.80

%

Core Return on Average Assets (ROAA)  

 

1.00

%

 

1.00

%

 

0.78

%

 
Return on Average Equity (ROAE)

 

11.80

%

 

11.83

%

 

10.65

%

Core Return on Average Equity (ROAE)  

 

12.15

%

 

12.30

%

 

10.38

%

 
Efficiency Ratio

 

60.29

%

 

60.82

%

 

63.57

%

Core Efficiency Ratio

 

59.57

%

 

59.84

%

 

65.21

%

 
Capital Adequacy:
Total Risk Based Capital Ratio

 

13.82

%

 

13.81

%

 

14.09

%

Common Equity Tier 1 Capital Ratio

 

12.57

%

 

12.56

%

 

12.84

%

Tier 1 Risk Based Capital Ratio

 

12.57

%

 

12.56

%

 

12.84

%

Tier 1 Leverage Ratio

 

8.66

%

 

8.91

%

 

8.33

%

Tangible Common Equity / Tangible Assets  

 

8.60

%

 

8.62

%

 

7.65

%

 
Asset Quality Overview
Non-Performing Loans

$

1,855

 

$

1,481

 

$

1,222

 

Loans 90+Days Past Due and Still Accruing  

 

-

 

 

-

 

 

-

 

Total Non-Performing Loans

 

1,855

 

 

1,481

 

 

1,222

 

 
Restructured Loans

 

227

 

 

229

 

 

235

 

 
Other Real Estate Owned

 

-

 

 

-

 

 

-

 

 
ALLL / Loans Receivable

 

1.40

%

 

1.40

%

 

1.40

%

Non-Performing Loans / Total Loans Receivable *  

 

0.14

%

 

0.12

%

 

0.12

%

Non-Performing Assets / Total Assets *

 

0.09

%

 

0.07

%

 

0.07

%

Net Charge-Offs (Recoveries) quarterly

$

(8

)

$

(6

)

$

(10

)

Net Charge-Offs (Recoveries) year-to-date  

$

(41

)

$

(33

)

$

(53

)

Net Charge-Offs (Recoveries) year-to-date / Average  

 

(0.00

%)

 

(0.00

%)

 

(0.00

%)

Loans Receivable

* Includes non-accrual loans, accruing loans past due 90+ days and Troubled Debt Restructurings (TDRs).

Contacts

Karen Schoenbaum
EVP/CFO
(213) 430-4000
www.americanbb.bank

Release Summary

American Business Bank Announces Record Net Income in 2019

Contacts

Karen Schoenbaum
EVP/CFO
(213) 430-4000
www.americanbb.bank