Cornerstone Community Bancorp Reports Financial Results for the Third Quarter Ended September 30, 2021

RED BLUFF, Calif.--()--Cornerstone Community Bancorp (OTC Pink: CRSB) announced today its financial results for the third quarter ended September 30, 2021.

The Company reported record net income of $2,085,000 for the three months ended September 30, 2021 compared to net income of $1,236,000 for the same period last year. Diluted earnings per share were $1.38 for the three months ended September 30, 2021 compared to $0.81 for the same period last year.

The return on average assets for the three months ended September 30, 2021 was 1.53% and the return on average equity was 23.52%. The tax-equivalent net interest margin was 3.66% for the three months ended September 30, 2021 compared to 2.99% for the same period last year and the efficiency ratio was 39.07% for the three months ended September 30, 2021 compared to 52.81% for the same period last year.

For the nine months ended September 30, 2021, the Company reported net income of $5,948,000 compared to net income of $2,567,000 for the same period last year. Diluted earnings per share were $3.96 for the nine months ended September 30, 2021 compared to $1.68 for the same period last year.

The return on average assets for the nine months ended September 30, 2021 was 1.48% and the return on average equity was 23.98%.

President and CEO, Jeff Finck stated, “We posted record profits in the third quarter as loan and deposit totals continued to grow at a solid pace.”

Net Interest Income

Net interest income increased to $4,756,000 for the quarter ended September 30, 2021 compared to $3,376,000 for the same quarter last year. For the nine months ended September 30, 2021, net interest income increased to $13,212,000 compared to $9,371,000 for the same period last year.

Provision for credit losses

Provision for credit losses were $400,000 for the quarter ended September 30, 2021 compared to no provision for the same quarter last year. For the nine months ended September 30, 2021, the Company recorded a $900,000 provision for credit losses compared to $1,600,000 for the same period last year.

Non-Interest Income

Non-interest income for the quarter ended September 30, 2021 was $714,000 compared to $296,000 for the quarter ended September 30, 2020. For the nine months ended September 30, 2021, non-interest income was $2,013,000 compared to $894,000 for the same period last year.

Non-Interest Expense

Non-interest expense was $2,137,000 for the quarter ended September 30, 2021 compared to $1,939,000 for the same period last year. For the nine months ended September 30, 2021, non-interest expense was $5,965,000 compared to $5,247,000 for the same period last year.

Balance Sheet

Total loans, net of unearned income at September 30, 2021 were $388.5 million compared to $342.4 million at September 30, 2020.

Total deposits were $500.1 million at September 30, 2021 compared to total deposits of $371.5 million at September 30, 2020.

Credit Quality

The allowance for loan losses was $4,909,000, or 1.26% of loans, net of unearned income at September 30, 2021, compared to $4,009,000, or 1.17% of loans, net of unearned income at September 30, 2020. There were no nonperforming assets at September 30, 2021 and September 30, 2020.

Capital

At September 30, 2021, shareholders’ equity totaled $35.5 million compared to $28.9 million at September 30, 2020. Book value was $24.37 per share at September 30, 2021 compared to $19.38 per share at September 30, 2020.

About Cornerstone Community Bancorp

Cornerstone Community Bancorp, a bank holding company headquartered in Red Bluff, California, serves the Red Bluff and Redding communities through its wholly-owned subsidiary, Cornerstone Community Bank with a headquarters office in Red Bluff and two banking offices in Redding. The Bank provides commercial banking services to small and mid-size businesses, including professional service firms, real estate developers and investors and not-for-profit organizations and to their owners and other individuals. Additional information about the Bank is available on its website at www.bankcornerstone.com

Forward-Looking Statements

This release may contain certain forward-looking statements that are based on management's current expectations regarding economic, legislative, and regulatory issues that may impact Cornerstone Community Bancorp's earnings in future periods. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words “believe,” “expect,” “intend,” “estimate” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could” or “may.” Factors that could cause future results to vary materially from current management expectations include, but are not limited to, natural disasters (such as wildfires and earthquakes), pandemics such as COVID-19 and the economic impact caused directly by the disease and by government responses thereto, general economic conditions, economic uncertainty in the United States and abroad, changes in interest rates, deposit flows, real estate values, costs or effects of acquisitions, competition, changes in accounting principles, policies or guidelines, legislation or regulation (including the Tax Cuts & Jobs Act of 2017 and the Coronavirus Aid, Relief and Economic Security Act of 2021), interruptions of utility service in our markets for sustained periods, and other economic, competitive, governmental, regulatory and technological factors (including external fraud and cybersecurity threats) affecting Cornerstone Community Bancorp's operations, pricing, products and services. Forward-looking statements speak only as of the date they are made. Except as required by law, Cornerstone Community Bancorp does not undertake to update forward-looking statements to reflect subsequent circumstances or events.

CORNERSTONE COMMUNITY BANCORP
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(Dollars in Thousands)

09/30/21

06/30/21

03/31/21

12/31/20

09/30/20

 
ASSETS
Cash and due from banks

$

4,765

 

$

5,450

 

$

5,417

 

$

3,811

 

$

5,455

 

Federal funds sold

 

2,600

 

 

2,256

 

 

5,761

 

 

14,166

 

 

5,045

 

Interest-bearing deposits

 

24,636

 

 

28,549

 

 

68,283

 

 

77,045

 

 

62,110

 

Investment securities

 

110,470

 

 

75,258

 

 

52,084

 

 

50,336

 

 

50,699

 

Loans held for sale

 

-

 

 

-

 

 

1,102

 

 

-

 

 

-

 

Loans, net of unearned income

 

388,532

 

 

390,748

 

 

382,253

 

 

332,176

 

 

342,416

 

Allowance for loan losses

 

(4,909

)

 

(4,509

)

 

(4,409

)

 

(4,009

)

 

(4,009

)

Loans, net

 

383,623

 

 

386,239

 

 

377,844

 

 

328,167

 

 

338,407

 

Premises and equipment, net

 

13,567

 

 

13,013

 

 

12,767

 

 

11,581

 

 

10,992

 

Other assets

 

14,863

 

 

14,972

 

 

13,974

 

 

12,724

 

 

12,577

 

Total assets

$

554,524

 

$

525,737

 

$

537,232

 

$

497,830

 

$

485,285

 

 
LIABILITIES
Deposits:
Demand noninterest-bearing

$

141,734

 

$

126,107

 

$

126,481

 

$

108,147

 

$

103,824

 

Demand interest-bearing

 

131,964

 

 

126,724

 

 

122,506

 

 

108,097

 

 

104,819

 

Money market and savings

 

150,149

 

 

150,086

 

 

163,232

 

 

146,655

 

 

87,035

 

Time deposits of less than $100,000

 

13,180

 

 

13,393

 

 

15,812

 

 

15,418

 

 

21,103

 

Time deposits of $100,000 or more

 

63,111

 

 

56,993

 

 

57,299

 

 

55,021

 

 

54,695

 

Total deposits

 

500,138

 

 

473,303

 

 

485,330

 

 

433,338

 

 

371,476

 

Borrowings and other obligations

 

5,000

 

 

5,000

 

 

5,000

 

 

15,000

 

 

78,136

 

Subordinated debentures

 

11,715

 

 

11,709

 

 

11,703

 

 

16,645

 

 

4,923

 

Interest payable and other liabilities

 

2,151

 

 

1,933

 

 

3,776

 

 

2,763

 

 

1,854

 

Total liabilities

 

519,004

 

 

491,945

 

 

505,809

 

 

467,746

 

 

456,389

 

 
SHAREHOLDERS' EQUITY
Common stock

 

14,814

 

 

14,771

 

 

14,681

 

 

14,584

 

 

15,462

 

Retained Earnings

 

21,084

 

 

18,999

 

 

17,183

 

 

15,136

 

 

13,077

 

Accumulated other comprehensive income (loss)

 

(378

)

 

22

 

 

(441

)

 

364

 

 

357

 

Total shareholders' equity

 

35,520

 

 

33,792

 

 

31,423

 

 

30,084

 

 

28,896

 

Total liabilities and shareholders' equity

$

554,524

 

$

525,737

 

$

537,232

 

$

497,830

 

$

485,285

 

 
Total equity / total assets

 

6.41

%

 

6.43

%

 

5.85

%

 

6.04

%

 

5.95

%

Book value per share

$

24.37

 

$

23.22

 

$

21.65

 

$

20.87

 

$

19.38

 

Shares outstanding

 

1,457,591

 

 

1,455,091

 

 

1,451,091

 

 

1,441,241

 

 

1,491,041

 

CORNERSTONE COMMUNITY BANCORP
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(Dollars in Thousands)

Three months ended

 

Nine months ended

09/30/21

06/30/21

09/30/20

 

09/30/21

09/30/20

 
INTEREST INCOME
Loans

$

4,772

 

$

4,379

 

$

3,695

 

$

13,602

 

$

10,663

 

Federal funds sold

 

-

 

 

1

 

 

1

 

 

3

 

 

22

 

Investment securities

 

360

 

 

217

 

 

161

 

 

739

 

 

333

 

Other

 

35

 

 

53

 

 

33

 

 

120

 

 

123

 

Total interest income

 

5,167

 

 

4,650

 

 

3,890

 

 

14,464

 

 

11,141

 

 
INTEREST EXPENSE
Deposits:
Interest-bearing demand

 

46

 

 

45

 

 

51

 

 

138

 

 

126

 

Money market and savings

 

96

 

 

93

 

 

79

 

 

276

 

 

384

 

Time deposits

 

107

 

 

114

 

 

198

 

 

345

 

 

789

 

Other

 

162

 

 

159

 

 

186

 

 

493

 

 

471

 

Total interest expense

 

411

 

 

411

 

 

514

 

 

1,252

 

 

1,770

 

 
Net interest income

 

4,756

 

 

4,239

 

 

3,376

 

 

13,212

 

 

9,371

 

Provision for credit losses

 

400

 

 

100

 

 

-

 

 

900

 

 

1,600

 

Net interest income after provision for credit losses

 

4,356

 

 

4,139

 

 

3,376

 

 

12,312

 

 

7,771

 

 
NON-INTEREST INCOME
Service charges on deposit accounts

 

62

 

 

59

 

 

49

 

 

179

 

 

167

 

Gain on sale of loans

 

396

 

 

135

 

 

-

 

 

1,231

 

 

186

 

Gain (loss) on sale of other real estate owned

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

Gain (loss) on sale of securities

 

-

 

 

-

 

 

91

 

 

(45

)

 

91

 

Other non-interest income

 

256

 

 

228

 

 

156

 

 

648

 

 

450

 

Total non-interest income

 

714

 

 

422

 

 

296

 

 

2,013

 

 

894

 

 
OPERATING EXPENSES
Salaries and benefits

 

1,048

 

 

968

 

 

979

 

 

2,695

 

 

2,310

 

Premises and fixed assets

 

212

 

 

199

 

 

200

 

 

590

 

 

709

 

Other

 

877

 

 

848

 

 

760

 

 

2,680

 

 

2,228

 

Total operating expenses

 

2,137

 

 

2,015

 

 

1,939

 

 

5,965

 

 

5,247

 

 
Income before income taxes

 

2,933

 

 

2,546

 

 

1,733

 

 

8,360

 

 

3,418

 

Income taxes

 

848

 

 

730

 

 

497

 

 

2,412

 

 

851

 

 
NET INCOME

$

2,085

 

$

1,816

 

$

1,236

 

$

5,948

 

$

2,567

 

 
EARNINGS PER SHARE
Basic earnings per share

$

1.43

 

$

1.25

 

$

0.83

 

$

4.09

 

$

1.73

 

Diluted earnings per share

$

1.38

 

$

1.20

 

$

0.81

 

$

3.96

 

$

1.68

 

Average common shares outstanding

 

1,456,531

 

 

1,453,915

 

 

1,491,041

 

 

1,452,768

 

 

1,485,661

 

Average common and equivalent shares outstanding

 

1,512,738

 

 

1,510,621

 

 

1,522,872

 

 

1,503,150

 

 

1,526,516

 

 
PERFORMANCE MEASURES
Return on average assets

 

1.53

%

 

1.35

%

 

1.05

%

 

1.48

%

 

0.85

%

Return on average equity

 

23.52

%

 

22.17

%

 

17.36

%

 

23.98

%

 

12.49

%

Tax-equivalent net interest margin

 

3.66

%

 

3.33

%

 

2.99

%

 

3.48

%

 

3.28

%

Efficiency ratio

 

39.07

%

 

43.23

%

 

52.81

%

 

39.18

%

 

51.12

%

 

Contacts

Jeffrey P. Finck
President & CEO
530.222.1460

Patrick E. Phelan
Chief Financial Officer
530.222.1460

Contacts

Jeffrey P. Finck
President & CEO
530.222.1460

Patrick E. Phelan
Chief Financial Officer
530.222.1460