California Community Bank Reports Profitable Quarter

Published on Wednesday, 28 July 2010 15:33 Written by TradersHuddle Staff

ESCONDIDO, Calif.-( Business Wire )-

California Community Bank (OTCBB: CABK), today released its unaudited second quarter 2010 financial results.

The Bank finished the second quarter of 2010 with an asset base of $218,556,000, an increase of $36,775,000, or 20%, from the end of June 2009. Total deposits were $190,862,000, up $37,330,000, or 24%, over the same period a year ago. As of June 30, 2010, total gross loans net of deferred fees, the primary revenue driver for the Bank, stood at $158,465,000 compared to $149,407,000 at June 30, 2009, an increase of $9,058,000, or 6%.

For the second quarter of 2010, the Bank reported a net profit of $338,000, or basic earnings per share of 16 cents, versus a net loss of $88,000, or a basic loss per share of 4 cents, for the comparable period last year. The net profit for the first six months of the year was $598,000, or basic earnings per share of 28 cents, compared to a net loss of $338,000, or a basic loss per share of 16 cents, for the first half of 2009.

Larry D. Hartwig, President and CEO, commented, "During the first half of 2010 we focused on profitability and are pleased with our operating results. We maintained our loan portfolio above the $150 million threshold, and despite the sustained low rate environment, tighter credit spreads, and an increased level of non-performing assets, achieved a 5% year-over-year increase in year-to-date interest income. We also continued to grow our core deposit base while at the same time, and to a greater degree, competitively lowered the average rates we paid on our money market and certificate of deposit products – successfully driving a 34% year-over-year reduction in interest expense. In summary, we ended the quarter with over $218 million in total assets and recorded a 28% increase in year-to-date net interest income, the principal driver of our return to profitability. All of this speaks well for responsibly building long-term shareholder and franchise value. Credit metrics are still difficult to predict in this economy, but we do know that our conservatively underwritten loan portfolio has continued to perform within acceptable parameters given the overall economy – resulting in only a modest increase to our reserves during the first two quarters of 2010. Management remains focused on normalized profitability and expense control as we held our year-to-date non-interest expenses to just a 2% year-over-year increase. We are confident in the core strengths of our franchise and we continue to aggressively manage our loan portfolio with the expectation of positive economic growth at some point in the future.”

Hartwig further commented, “Capital ratios are strong, non-interest bearing deposits have increased, and our conservative loan underwriting is allowing us to navigate through the current credit cycle. In this economy, we also know that loan growth must be driven by market share gains rather than by increased economic activity. Our focus is on our relationship style of banking targeted toward small-to-medium size businesses, professionals, and high net worth individuals within our market area. We have not wavered from generating local market deposits and continue to make loans as usual to qualified borrowers. With our four-branch network and operating infrastructure firmly in place – we remain well-positioned to further grow the business and improve our bottom line financial performance results. We fully recognize the valuable contributions of our highly professional staff in making California Community Bank an outstanding organization committed to providing our customers with ‘Real Solutions. Personally Delivered.’”

California Community Bank is headquartered at 1320 West Valley Parkway in Escondido and currently operates four branches – Escondido, Encinitas, San Diego, and Vista, CA. For more information on the Bank, please visit www.calcommunitybank.com or call 760-888-1000.

The numbers in this press release are unaudited. Certain statements in this press release, including statements regarding the anticipated development and expansion of the Bank’s business, and the intent, belief or current expectations of the Bank, its directors or its officers, are “forward looking” statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward looking statements. These risks and uncertainties include, but are not limited to, risks related to the local and national economy, the Bank’s performance, regulatory matters and those discussed in filings by the Bank with the Federal Deposit Insurance Corporation.

Condensed Statements of Financial Condition
($ in thousands)
Unaudited									6/30/2010					6/30/2009
Assets
Cash and Due from Banks									$ 18,225					$ 16,018
Federal Funds Sold									27,430					725
Investment Securities Available for Sale									13,374					14,550
Loans, Net of Deferred Fees and Costs									158,465					149,407
Allowance for Loan Losses									(2,914	)				(1,941	)
		Net Loans							155,551					147,466
Other Assets									3,976					3,022
		Total Assets							$ 218,556					$ 181,781
Liabilities and Shareholders' Equity
Deposits
	Noninterest-Bearing								$ 40,505					$ 31,556
	Interest-Bearing								150,357					121,976
		Total Deposits							190,862					153,532
Other Borrowings									3,000					4,000
Other Liabilities									812					1,036
		Total Liabilities							194,674					158,568
		Total Shareholders' Equity							23,882					23,213
		Total Liabilities and Shareholders' Equity							$ 218,556					$ 181,781
Condensed Statements of Operations
($ in thousands, except per share amounts)
									Three Months Ended										Six Months Ended
Unaudited									6/30/2010					6/30/2009					6/30/2010					6/30/2009
Interest Income									$ 2,529					$ 2,449					$ 5,076					$ 4,816
Interest Expense									505					835					1,167					1,763
		Net Interest Income							2,024					1,614					3,909					3,053
Provision for Loan Losses									125					160					157					305
		Net Interest Income After Provision for Loan Losses							1,899					1,454					3,752					2,748
Noninterest Income									87					97					166					183
Noninterest Expense
	Salaries and Employee Benefits								864					854					1,828					1,778
	Occupancy and Equipment Expenses								304					314					610					637
	Other Operating Expense								480					471					882					853
									1,648					1,639					3,320					3,268
		Income (Loss) Before Income Taxes							338					(88	)				598					(337	)
Income Taxes (Benefit)									-					-					-					1
		Net Income (Loss)							$ 338					$ (88	)				$ 598					$ (338	)
Earnings (Loss) Per Share - Basic
Earnings (Loss) Per Share - Basic									$ 0.16					$ (0.04	)				$ 0.28					$ (0.16	)
Weighted Average Basic Shares									2,099,293					2,099,293					2,099,293					2,099,293
Net Interest Margin									3.89	%				3.99	%				3.69	%				3.67	%
Regulatory Capital Ratios									6/30/2010					6/30/2009
Total Capital (to Risk-Weighted Assets)									14.06	%				15.19	%
	Required to be Well-Capitalized								10.00	%				10.00	%
Tier 1 Capital (to Risk-Weighted Assets)									12.81	%				13.96	%
	Required to be Well-Capitalized								6.00	%				6.00	%
Tier 1 Capital (to Average Assets)									10.05	%				12.73	%
	Required to be Well-Capitalized								5.00	%				5.00	%

California Community Bank, Escondido, CALarry D. Hartwig, This e-mail address is being protected from spambots. You need JavaScript enabled to view it.