LOS ANGELES--(BUSINESS WIRE)-- PCB Bancorp (the “Company”) (NASDAQ: PCB), the holding company of Pacific City Bank (the “Bank”), today reported net income of $9.1 million, or $0.60 per diluted common share, for the second quarter of 2022, compared with $10.2 million, or $0.67 per diluted common share, for the previous quarter and $9.8 million, or $0.64 per diluted common share, for the year-ago quarter.
The Company also announced that the Bank will change its name to PCB Bank, effective August 25, 2022. In addition, the Company introduced a new logo, which will also be utilized by the Bank after its name change.
Q2 2022 Highlights
-
Net income totaled $9.1 million, or $0.60 per diluted common share, for the current quarter;
- The Company recorded a reversal for loan losses of $109 thousand for the current quarter compared with $1.2 million for the previous quarter and $934 thousand for the year-ago quarter.
- Allowance for loan losses (“Allowance”) to loans held-for-investment(1) ratio was 1.15% at June 30, 2022 compared with 1.22% at March 31, 2022, 1.29% at December 31, 2021 and 1.45% at June 30, 2021. Adjusted Allowance to loans held-for-investment ratio(2) was 1.15% at June 30, 2022 compared with 1.23% at March 31, 2022, 1.34% at December 31, 2021 and 1.62% at June 30, 2021.
- Net interest income was $21.4 million for the current quarter compared with $20.0 million for the previous quarter and $19.0 million for the year-ago quarter. Net interest margin was 4.01% for the current quarter compared with 3.87% for the previous quarter and 3.83% for the year-ago quarter.
- Gain on sale of loans was $2.0 million for the current quarter compared with $3.8 million for the previous quarter and $4.0 million for the year-ago quarter.
- Total assets were $2.34 billion at June 30, 2022, an increase of $144.8 million, or 6.6%, from $2.20 billion at March 31, 2022, an increase of $194.8 million, or 9.1%, from $2.15 billion at December 31, 2021, and an increase of $284.6 million, or 13.8%, from $2.06 billion at June 30, 2021;
-
Loans held-for-investment were $1.83 billion at June 30, 2022, an increase of $90.1 million, or 5.2%, from $1.74 billion at March 31, 2022, an increase of $100.8 million, or 5.8%, from $1.73 billion at December 31, 2021, and an increase of $113.4 million, or 6.6%, from $1.72 billion at June 30, 2021;
- SBA PPP loans totaled $1.6 million, $22.9 million, $65.3 million, and $181.0 million at June 30, 2022, March 31, 2022, December 31, 2021, and June 30, 2021, respectively.
- The Company had no loans under modified terms related to COVID-19 at June 30, 2022, March 31, 2022, and December 31, 2021. Loans under modified terms related to the COVID-19 pandemic totaled $16.2 million at June 30, 2021.
- Total deposits were $2.00 billion at June 30, 2022, an increase of $87.2 million, or 4.6%, from $1.91 billion at March 31, 2022, an increase of $130.5 million, or 7.0%, from $1.87 billion at December 31, 2021, and an increase of $200.0 million, or 11.1%, from $1.80 billion at June 30, 2021; and
- On May 24, 2022, the Company issued 69,141 shares of preferred stock in exchange for a capital investment of $69.1 million from the U.S. Department of Treasury (the “Treasury”) under the Emergency Capital Investment Program (“ECIP”).
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||
(1) |
Loans held-for-investment are presented net of deferred fees and costs in this press release. |
|
(2) |
Adjusted Allowance to loans held-for-investment ratio is a non-GAAP measure, which excludes U.S. Small Business Administration (“SBA”) Paycheck Protection Program (“PPP”) loans from loans held-for-investment. See “Non-GAAP Measures” for reconciliation of this measure to its most comparable GAAP measure. |
|
“We are pleased with another solid financial performance for the second quarter of 2022,” stated Henry Kim, President and Chief Executive Officer. “We continued to maintain an asset-sensitive balance sheet and executed another quarterly performance of a well-balanced deposit and loan growth combined with a record net interest income.”
“During the second quarter of 2022, our deposits increased at an annualized rate of 18% and we funded $161 million in loans held-for-investment, resulting in a 26% annualized growth rate, excluding SBA PPP loans. Our outstanding credit quality continued as demonstrated by our non-performing assets to loans held-for-investment ratio of 0.09% and classified assets to total assets ratio of 0.20%. Our net interest margin expanded 14 basis points quarter-over-quarter to 4.01% for the second quarter while we maintained our efficiency rate at 49%.”
“As we look ahead to the second half of this year, in spite of the challenging economic outlook ahead, we will remain opportunistic with our strong capital position and continue to invest in our franchise value by expanding our footprint. We are on schedule to open two new full-service branches in Dallas, Texas and a new full-service branch in Palisades Park, New Jersey during the third quarter of this year,” concluded Kim.
Financial Highlights (Unaudited)
($ in thousands, except per share data) |
Three Months Ended |
Six Months Ended |
|||||||||||||||||||||||||||
6/30/2022 |
3/31/2022 |
% Change |
6/30/2021 |
% Change |
6/30/2022 |
6/30/2021 |
% Change |
||||||||||||||||||||||
Net income |
$ |
9,092 |
$ |
10,240 |
(11.2 |
)% |
$ |
9,844 |
(7.6 |
)% |
$ |
19,332 |
$ |
18,404 |
5.0 |
% |
|||||||||||||
Diluted earnings per common share |
$ |
0.60 |
$ |
0.67 |
(10.4 |
)% |
$ |
0.64 |
(6.3 |
)% |
$ |
1.27 |
$ |
1.19 |
6.7 |
% |
|||||||||||||
Net interest income |
$ |
21,351 |
$ |
19,993 |
6.8 |
% |
$ |
18,996 |
12.4 |
% |
$ |
41,344 |
$ |
36,815 |
12.3 |
% |
|||||||||||||
Reversal for loan losses |
(109 |
) |
(1,191 |
) |
(90.8 |
)% |
(934 |
) |
(88.3 |
)% |
(1,300 |
) |
(2,081 |
) |
(37.5 |
)% |
|||||||||||||
Noninterest income |
3,648 |
5,286 |
(31.0 |
)% |
5,151 |
(29.2 |
)% |
8,934 |
8,008 |
11.6 |
% |
||||||||||||||||||
Noninterest expense |
12,245 |
12,071 |
1.4 |
% |
11,139 |
9.9 |
% |
24,316 |
20,808 |
16.9 |
% |
||||||||||||||||||
Return on average assets (1) |
1.65 |
% |
1.92 |
% |
1.96 |
% |
1.78 |
% |
1.85 |
% |
|||||||||||||||||||
Return on average shareholders’ equity (1) |
12.48 |
% |
16.01 |
% |
16.49 |
% |
14.13 |
% |
15.59 |
% |
|||||||||||||||||||
Return on average tangible common equity (“TCE”) (2) |
13.85 |
% |
16.01 |
% |
16.49 |
% |
14.92 |
% |
15.59 |
% |
|||||||||||||||||||
Net interest margin (1) |
4.01 |
% |
3.87 |
% |
3.83 |
% |
3.94 |
% |
3.77 |
% |
|||||||||||||||||||
Efficiency ratio (3) |
48.98 |
% |
47.75 |
% |
46.13 |
% |
48.36 |
% |
46.42 |
% |
|||||||||||||||||||
($ in thousands, except per share data) |
6/30/2022 |
3/31/2022 |
% Change |
12/31/2021 |
% Change |
6/30/2021 |
% Change |
||||||||||||||||||
Total assets |
$ |
2,344,560 |
$ |
2,199,742 |
6.6 |
% |
$ |
2,149,735 |
9.1 |
% |
$ |
2,060,003 |
13.8 |
% |
|||||||||||
Net loans held-for-investment |
1,811,939 |
1,721,757 |
5.2 |
% |
1,709,824 |
6.0 |
% |
1,694,767 |
6.9 |
% |
|||||||||||||||
Total deposits |
1,997,607 |
1,910,379 |
4.6 |
% |
1,867,134 |
7.0 |
% |
1,797,648 |
11.1 |
% |
|||||||||||||||
Book value per common share (4) |
$ |
22.36 |
$ |
17.47 |
$ |
17.24 |
$ |
16.09 |
|||||||||||||||||
TCE per common share (2) |
$ |
17.73 |
$ |
17.47 |
$ |
17.24 |
$ |
16.09 |
|||||||||||||||||
Tier 1 leverage ratio (consolidated) |
15.37 |
% |
12.22 |
% |
12.11 |
% |
11.76 |
% |
|||||||||||||||||
Total shareholders’ equity to total assets |
14.26 |
% |
11.87 |
% |
11.92 |
% |
11.60 |
% |
|||||||||||||||||
TCE to total assets (2), (5) |
11.31 |
% |
11.87 |
% |
11.92 |
% |
11.60 |
% |
|||||||||||||||||
(1) |
Ratios are presented on an annualized basis. |
|
(2) |
Non-GAAP. See “Non-GAAP Measures” for reconciliation of this measure to its most comparable GAAP measure. |
|
(3) |
Calculated by dividing noninterest expense by the sum of net interest income and noninterest income. |
|
(4) |
Calculated by dividing total shareholders’ equity by the number of outstanding common shares. |
|
(5) |
The Company did not have any intangible asset component for the presented periods. |
COVID-19 Pandemic
The ongoing COVID-19 pandemic, and governmental and societal responses thereto, have had a severe impact on global economic and market conditions. The U.S. government has enacted a number of monetary and fiscal policies to provide fiscal stimulus and relief in order to mitigate the impact of the COVID-19 pandemic. However, the COVID-19 pandemic continues to be a challenge to public health, including the emergence of new variants, and impact global economic and market conditions, including global supply chain disruptions and high inflation.
Since the beginning of the crisis, the Company has taken a number of steps to protect the safety of its employees and to support its customers. The Company has enabled its staff to work remotely and established safety measures within its bank premises and branches for both employees and customers. In order to support its customers, the Company has been in close contact with them, assessing the level of impact on their businesses, and putting a process in place to evaluate each client’s specific situation and provide relief programs where appropriate, including SBA PPP loans and loan modifications related to the COVID-19 pandemic.
At this time, the Company cannot estimate the long term impact of the COVID-19 pandemic, but these conditions are expected to continue to impact its business, results of operations, and financial condition negatively.
Result of Operations (Unaudited)
Net Interest Income and Net Interest Margin
The following table presents the components of net interest income for the periods indicated:
Three Months Ended |
Six Months Ended |
||||||||||||||||||||||||||||
($ in thousands) |
6/30/2022 |
3/31/2022 |
% Change |
6/30/2021 |
% Change |
6/30/2022 |
6/30/2021 |
% Change |
|||||||||||||||||||||
Interest income/expense on |
|||||||||||||||||||||||||||||
Loans |
$ |
21,243 |
$ |
20,190 |
5.2 |
% |
$ |
19,511 |
8.9 |
% |
$ |
41,433 |
$ |
38,255 |
8.3 |
% |
|||||||||||||
Investment securities |
668 |
476 |
40.3 |
% |
375 |
78.1 |
% |
1,144 |
735 |
55.6 |
% |
||||||||||||||||||
Other interest-earning assets |
535 |
228 |
134.6 |
% |
165 |
224.2 |
% |
763 |
319 |
139.2 |
% |
||||||||||||||||||
Total interest-earning assets |
22,446 |
20,894 |
7.4 |
% |
20,051 |
11.9 |
% |
43,340 |
39,309 |
10.3 |
% |
||||||||||||||||||
Interest-bearing deposits |
1,041 |
850 |
22.5 |
% |
1,000 |
4.1 |
% |
1,891 |
2,311 |
(18.2 |
)% |
||||||||||||||||||
Borrowings |
54 |
51 |
5.9 |
% |
55 |
(1.8 |
)% |
105 |
183 |
(42.6 |
)% |
||||||||||||||||||
Total interest-bearing liabilities |
1,095 |
901 |
21.5 |
% |
1,055 |
3.8 |
% |
1,996 |
2,494 |
(20.0 |
)% |
||||||||||||||||||
Net interest income |
$ |
21,351 |
$ |
19,993 |
6.8 |
% |
$ |
18,996 |
12.4 |
% |
$ |
41,344 |
$ |
36,815 |
12.3 |
% |
|||||||||||||
Average balance of |
|||||||||||||||||||||||||||||
Loans |
$ |
1,804,368 |
$ |
1,773,376 |
1.7 |
% |
$ |
1,691,704 |
6.7 |
% |
$ |
1,788,958 |
$ |
1,666,808 |
7.3 |
% |
|||||||||||||
Investment securities |
135,324 |
123,230 |
9.8 |
% |
132,249 |
2.3 |
% |
129,310 |
128,073 |
1.0 |
% |
||||||||||||||||||
Other interest-earning assets |
195,633 |
198,918 |
(1.7 |
)% |
164,710 |
18.8 |
% |
197,267 |
176,864 |
11.5 |
% |
||||||||||||||||||
Total interest-earning assets |
$ |
2,135,325 |
$ |
2,095,524 |
1.9 |
% |
$ |
1,988,663 |
7.4 |
% |
$ |
2,115,535 |
$ |
1,971,745 |
7.3 |
% |
|||||||||||||
Interest-bearing deposits |
$ |
1,001,424 |
$ |
1,034,012 |
(3.2 |
)% |
$ |
1,026,937 |
(2.5 |
)% |
$ |
1,017,629 |
$ |
1,040,316 |
(2.2 |
)% |
|||||||||||||
Borrowings |
11,132 |
10,400 |
7.0 |
% |
19,012 |
(41.4 |
)% |
10,768 |
47,128 |
(77.2 |
)% |
||||||||||||||||||
Total interest-bearing liabilities |
$ |
1,012,556 |
$ |
1,044,412 |
(3.1 |
)% |
$ |
1,045,949 |
(3.2 |
)% |
$ |
1,028,397 |
$ |
1,087,444 |
(5.4 |
)% |
|||||||||||||
Total funding (1) |
$ |
1,902,247 |
$ |
1,885,038 |
0.9 |
% |
$ |
1,766,054 |
7.7 |
% |
$ |
1,893,691 |
$ |
1,751,346 |
8.1 |
% |
|||||||||||||
Annualized average yield/cost of |
|||||||||||||||||||||||||||||
Loans |
4.72 |
% |
4.62 |
% |
4.63 |
% |
4.67 |
% |
4.63 |
% |
|||||||||||||||||||
Investment securities |
1.98 |
% |
1.57 |
% |
1.14 |
% |
1.78 |
% |
1.16 |
% |
|||||||||||||||||||
Other interest-earning assets |
1.10 |
% |
0.46 |
% |
0.40 |
% |
0.78 |
% |
0.36 |
% |
|||||||||||||||||||
Total interest-earning assets |
4.22 |
% |
4.04 |
% |
4.04 |
% |
4.13 |
% |
4.02 |
% |
|||||||||||||||||||
Interest-bearing deposits |
0.42 |
% |
0.33 |
% |
0.39 |
% |
0.37 |
% |
0.45 |
% |
|||||||||||||||||||
Borrowings |
1.95 |
% |
1.99 |
% |
1.16 |
% |
1.97 |
% |
0.78 |
% |
|||||||||||||||||||
Total interest-bearing liabilities |
0.43 |
% |
0.35 |
% |
0.40 |
% |
0.39 |
% |
0.46 |
% |
|||||||||||||||||||
Net interest margin |
4.01 |
% |
3.87 |
% |
3.83 |
% |
3.94 |
% |
3.77 |
% |
|||||||||||||||||||
Cost of total funding (1) |
0.23 |
% |
0.19 |
% |
0.24 |
% |
0.21 |
% |
0.29 |
% |
|||||||||||||||||||
Supplementary information |
|||||||||||||||||||||||||||||
Net accretion of discount on loans |
$ |
907 |
$ |
908 |
(0.1 |
)% |
$ |
1,012 |
(10.4 |
)% |
$ |
1,815 |
$ |
1,757 |
3.3 |
% |
|||||||||||||
Net amortization of deferred loan fees |
$ |
606 |
$ |
1,165 |
(48.0 |
)% |
$ |
1,459 |
(58.5 |
)% |
$ |
1,771 |
$ |
2,679 |
(33.9 |
)% |
|||||||||||||
(1) |
Total funding is the sum of interest-bearing liabilities and noninterest-bearing deposits. The cost of total funding is calculated as annualized total interest expense divided by average total funding. |
Loans. The increases in average yield for the current quarter and year-to-date period were primarily due to an increase in overall interest rates on loans from the rising interest rate environment, partially offset by a decrease in net amortization of deferred loan fees from the decreased amount of SBA PPP loan payoffs.
The following table presents a composition of total loans by interest rate type accompanied with the weighted-average contractual rates as of the dates indicated:
6/30/2022 |
3/31/2022 |
12/31/2021 |
6/30/2021 |
|||||||||||||||||||||
% to Total Loans |
Weighted-Average Contractual Rate |
% to Total Loans |
Weighted-Average Contractual Rate |
% to Total Loans |
Weighted-Average Contractual Rate |
% to Total Loans |
Weighted-Average Contractual Rate |
|||||||||||||||||
Fixed rate loans |
24.5 |
% |
4.35 |
% |
26.7 |
% |
4.25 |
% |
28.4 |
% |
3.98 |
% |
33.9 |
% |
3.56 |
% |
||||||||
Hybrid rate loans |
37.0 |
% |
4.11 |
% |
31.5 |
% |
4.07 |
% |
29.1 |
% |
4.16 |
% |
22.5 |
% |
4.52 |
% |
||||||||
Variable rate loans |
38.5 |
% |
5.12 |
% |
41.8 |
% |
4.14 |
% |
42.5 |
% |
3.95 |
% |
43.6 |
% |
3.99 |
% |
||||||||
Investment Securities. The increases in average yield for the current quarter and year-to-date period were primarily due to a decrease in net amortization of premiums on mortgage-backed securities and collateralized mortgage obligations.
Other Interest-Earning Assets. The increases in average yield for the current quarter and year-to-date period were primarily due to an increased interest rate on cash held at the Federal Reserve Bank (“FRB”) account. The increases in average balance for the current quarter and year-to-date period compared with the same periods of 2021 were primarily due to an increase in deposits and the ECIP capital investment, partially offset by an increase in loans. The Company maintains most of its cash at the FRB account.
Interest-Bearing Deposits. The increases in average cost for the current quarter compared with the previous and year-ago quarters were primarily due to an increase in market rates. The decrease in average cost for the current year-to-date period compared with the previous year-to-date period was primarily due to the lower interest rates on time deposits opened throughout 2021.
Borrowings. The increase in average cost for the current quarter compared with the year-ago quarter was primarily due to matured borrowings with lower interest rates during 2021. At June 30, 2022, the Company had no FHLB advances.
Reversal for Loan Losses
Reversal for loan losses was $109 thousand for the current quarter compared with $1.2 million for the previous quarter and $934 thousand for the year-ago quarter. For the current and previous year-to-date periods, reversal for loan losses was $1.3 million and $2.1 million, respectively. The reversals for the current quarter and year-to-date period were primarily due to a decrease in qualitative adjustment factor allocations related to economic implications of the COVID-19 pandemic. The Company recorded net charge-offs (recoveries) of $18 thousand for the current quarter compared with $(8) thousand for the previous quarter and $(309) thousand for the year-ago quarter. For the current and previous year-to-date periods, the Company recorded net charge-offs (recoveries) of $10 thousand and $(460) thousand, respectively.
Adjusted Allowance to loans held-for-investment ratio(1) was 1.15%, 1.23%, 1.34%, and 1.62% at June 30, 2022, March 31, 2022, December 31, 2021, and June 30, 2021, respectively.
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||
(1) |
Adjusted Allowance to loans held-for-investment ratio is a non-GAAP measure, which excludes SBA PPP loans from loans held-for-investment. See “Non-GAAP Measures” for reconciliation of this measure to its most comparable GAAP measure. |
|
Noninterest Income
The following table presents the components of noninterest income for the periods indicated:
Three Months Ended |
Six Months Ended |
|||||||||||||||||||||||
($ in thousands) |
6/30/2022 |
3/31/2022 |
% Change |
6/30/2021 |
% Change |
6/30/2022 |
6/30/2021 |
% Change |
||||||||||||||||
Gain on sale of loans |
$ |
2,039 |
$ |
3,777 |
(46.0 |
)% |
$ |
3,967 |
(48.6 |
)% |
$ |
5,816 |
$ |
5,289 |
10.0 |
% |
||||||||
Service charges and fees on deposits |
330 |
303 |
8.9 |
% |
302 |
9.3 |
% |
633 |
595 |
6.4 |
% |
|||||||||||||
Loan servicing income |
755 |
700 |
7.9 |
% |
545 |
38.5 |
% |
1,455 |
1,427 |
2.0 |
% |
|||||||||||||
Bank-owned life insurance income |
175 |
172 |
1.7 |
% |
— |
— |
% |
347 |
— |
— |
% |
|||||||||||||
Other income |
349 |
334 |
4.5 |
% |
337 |
3.6 |
% |
683 |
697 |
(2.0 |
)% |
|||||||||||||
Total noninterest income |
$ |
3,648 |
$ |
5,286 |
(31.0 |
)% |
$ |
5,151 |
(29.2 |
)% |
$ |
8,934 |
$ |
8,008 |
11.6 |
% |
||||||||
Gain on Sale of Loans. The following table presents information on gain on sale of loans for the periods indicated:
Three Months Ended |
Six Months Ended |
|||||||||||||||||||||||
($ in thousands) |
6/30/2022 |
3/31/2022 |
% Change |
6/30/2021 |
% Change |
6/30/2022 |
6/30/2021 |
% Change |
||||||||||||||||
Gain on sale of SBA loans |
||||||||||||||||||||||||
Sold loan balance |
$ |
38,442 |
$ |
39,683 |
(3.1 |
)% |
$ |
34,107 |
12.7 |
% |
$ |
78,125 |
$ |
45,026 |
73.5 |
% |
||||||||
Premium received |
2,600 |
4,206 |
(38.2 |
)% |
4,172 |
(37.7 |
)% |
6,806 |
5,481 |
24.2 |
% |
|||||||||||||
Gain recognized |
2,039 |
3,777 |
(46.0 |
)% |
3,954 |
(48.4 |
)% |
5,816 |
5,149 |
13.0 |
% |
|||||||||||||
Gain on sale of residential property loans |
||||||||||||||||||||||||
Sold loan balance |
$ |
— |
$ |
— |
— |
% |
$ |
1,615 |
(100.0 |
)% |
$ |
— |
$ |
9,522 |
(100.0 |
)% |
||||||||
Gain recognized |
— |
— |
— |
% |
13 |
(100.0 |
)% |
— |
140 |
(100.0 |
)% |
|||||||||||||
The decrease in gain on sale of SBA loans was primarily due to reduced premiums received in the secondary market.
Loan Servicing Income. The following table presents information on loan servicing income for the periods indicated:
Three Months Ended |
Six Months Ended |
||||||||||||||||||||||||||||
($ in thousands) |
6/30/2022 |
3/31/2022 |
% Change |
6/30/2021 |
% Change |
6/30/2022 |
6/30/2021 |
% Change |
|||||||||||||||||||||
Loan servicing income |
|||||||||||||||||||||||||||||
Servicing income received |
$ |
1,287 |
$ |
1,230 |
4.6 |
% |
$ |
1,124 |
14.5 |
% |
$ |
2,517 |
$ |
2,397 |
5.0 |
% |
|||||||||||||
Servicing assets amortization |
(532 |
) |
(530 |
) |
0.4 |
% |
(579 |
) |
(8.1 |
)% |
(1,062 |
) |
(970 |
) |
9.5 |
% |
|||||||||||||
Loan servicing income |
$ |
755 |
$ |
700 |
7.9 |
% |
$ |
545 |
38.5 |
% |
$ |
1,455 |
$ |
1,427 |
2.0 |
% |
|||||||||||||
Underlying loans at end of period |
$ |
537,990 |
$ |
531,183 |
1.3 |
% |
$ |
492,130 |
9.3 |
% |
$ |
537,990 |
$ |
492,130 |
9.3 |
% |
|||||||||||||
The Company services SBA loans and certain residential property loans that are sold to the secondary market.
Noninterest Expense
The following table presents the components of noninterest expense for the periods indicated:
Three Months Ended |
Six Months Ended |
|||||||||||||||||||||||
($ in thousands) |
6/30/2022 |
3/31/2022 |
% Change |
6/30/2021 |
% Change |
6/30/2022 |
6/30/2021 |
% Change |
||||||||||||||||
Salaries and employee benefits |
$ |
8,125 |
$ |
8,595 |
(5.5 |
)% |
$ |
7,125 |
14.0 |
% |
$ |
16,720 |
$ |
13,307 |
25.6 |
% |
||||||||
Occupancy and equipment |
1,537 |
1,397 |
10.0 |
% |
1,388 |
10.7 |
% |
2,934 |
2,759 |
6.3 |
% |
|||||||||||||
Professional fees |
642 |
403 |
59.3 |
% |
658 |
(2.4 |
)% |
1,045 |
1,152 |
(9.3 |
)% |
|||||||||||||
Marketing and business promotion |
310 |
207 |
49.8 |
% |
516 |
(39.9 |
)% |
517 |
654 |
(20.9 |
)% |
|||||||||||||
Data processing |
441 |
404 |
9.2 |
% |
396 |
11.4 |
% |
845 |
773 |
9.3 |
% |
|||||||||||||
Director fees and expenses |
182 |
169 |
7.7 |
% |
151 |
20.5 |
% |
351 |
289 |
21.5 |
% |
|||||||||||||
Regulatory assessments |
147 |
141 |
4.3 |
% |
179 |
(17.9 |
)% |
288 |
387 |
(25.6 |
)% |
|||||||||||||
Other expense |
861 |
755 |
14.0 |
% |
726 |
18.6 |
% |
1,616 |
1,487 |
8.7 |
% |
|||||||||||||
Total noninterest expense |
$ |
12,245 |
$ |
12,071 |
1.4 |
% |
$ |
11,139 |
9.9 |
% |
$ |
24,316 |
$ |
20,808 |
16.9 |
% |
||||||||
Salaries and Employee Benefits. The decrease in the current quarter compared with the previous quarter was primarily due to decreases in incentives tied to the sales of Loan Production Offices (“LPO”) originated SBA loans and vacation accrual, increases in loan origination cost, which offsets the recognition of salaries, partially offset by an increase in salaries from the increased number of employees. The increase in the current quarter compared with the year-ago quarter was primarily due to an increase in salaries from the annual merit increase and the increase in number of employees, partially offset by a decrease in incentives tied to the sales of LPO originated SBA loans and an increase in loan origination cost. The increase for the current year-to-date period compared with the previous year-to-date period was primarily due to increases in salaries, the incentives tied to sales of LPO originated SBA loans, and other employee benefit expenses, and a decrease in loan origination cost.
Total loan origination cost included in salaries and employee benefits were $461 thousand, $365 thousand, and $399 thousand for the current, previous, and year-ago quarters, respectively, and $826 thousand and $1.4 million for the current and previous year-to-date periods, respectively. The Company recognized a higher loan origination cost for the previous year-to-date period primarily due to the SBA PPP loan production in the first quarter of 2021. The number of full-time equivalent employees was 271, 256, and 248 as of June 30, 2022, March 31, 2022, and June 30, 2021, respectively.
Professional Fees. The increase for the current quarter compared with the previous quarter was primarily to increases in internal audit and other professional fees. The decrease for the current year-to-date period compared with the previous year-to-date period was primarily due to a decrease in internal audit fees.
Marketing and Business Promotion. The increase for the current quarter compared with the previous quarter was primarily due to increases in marketing activities and advertisement. The decreases for the current quarter and year-to-date period compared with the same periods of 2021 were primarily due to a decrease in advertisement, partially offset by an increase in marketing activities.
Director Fees and Expenses. The increases for the current quarter and year-to-date periods compared with the same periods of 2021 were primarily due to a new director appointed during the fourth quarter of 2021.
Regulatory Assessments. The decrease for the current quarter and year-to-date periods compared with the same periods of 2021 were primarily due to a decrease in assessment rate.
Balance Sheet (Unaudited)
Total assets were $2.34 billion at June 30, 2022, an increase of $144.8 million, or 6.6%, from $2.20 billion at March 31, 2022, an increase of $194.8 million, or 9.1%, from $2.15 billion at December 31, 2021, and an increase of $284.6 million, or 13.8%, from $2.06 billion at June 30, 2021. The increases for the current quarter and year-to-date period were primarily due to increases in cash and cash equivalents, securities available-for-sale, and loans held-for-investment, supported by an increase in deposits and the ECIP capital investment.
The following table presents a composition of total loans (includes both loans held-for-sale and loans held-for-investment) as of the dates indicated:
($ in thousands) |
6/30/2022 |
3/31/2022 |
% Change |
12/31/2021 |
% Change |
6/30/2021 |
% Change |
||||||||||||||
Real estate loans |
|||||||||||||||||||||
Commercial property |
$ |
1,204,142 |
$ |
1,150,101 |
4.7 |
% |
$ |
1,105,843 |
8.9 |
% |
$ |
997,918 |
20.7 |
% |
|||||||
Residential property |
258,259 |
215,132 |
20.0 |
% |
209,485 |
23.3 |
% |
196,983 |
31.1 |
% |
|||||||||||
SBA property |
131,420 |
129,400 |
1.6 |
% |
129,661 |
1.4 |
% |
124,251 |
5.8 |
% |
|||||||||||
Construction |
12,595 |
9,522 |
32.3 |
% |
8,252 |
52.6 |
% |
13,475 |
(6.5 |
)% |
|||||||||||
Commercial and industrial loans |
|||||||||||||||||||||
Commercial term |
73,885 |
69,836 |
5.8 |
% |
73,438 |
0.6 |
% |
74,503 |
(0.8 |
)% |
|||||||||||
Commercial lines of credit |
111,916 |
107,406 |
4.2 |
% |
100,936 |
10.9 |
% |
90,286 |
24.0 |
% |
|||||||||||
SBA commercial term |
16,985 |
16,880 |
0.6 |
% |
17,640 |
(3.7 |
)% |
19,614 |
(13.4 |
)% |
|||||||||||
SBA PPP |
1,583 |
22,926 |
(93.1 |
)% |
65,329 |
(97.6 |
)% |
181,019 |
(99.1 |
)% |
|||||||||||
Other consumer loans |
22,225 |
21,752 |
2.2 |
% |
21,621 |
2.8 |
% |
21,607 |
2.9 |
% |
|||||||||||
Loans held-for-investment |
1,833,010 |
1,742,955 |
5.2 |
% |
1,732,205 |
5.8 |
% |
1,719,656 |
6.6 |
% |
|||||||||||
Loans held-for-sale |
9,627 |
18,340 |
(47.5 |
)% |
37,026 |
(74.0 |
)% |
11,255 |
(14.5 |
)% |
|||||||||||
Total loans |
$ |
1,842,637 |
$ |
1,761,295 |
4.6 |
% |
$ |
1,769,231 |
4.1 |
% |
$ |
1,730,911 |
6.5 |
% |
|||||||
The increase in loans held-for-investment for the current quarter was primarily due to new funding of $160.9 million and advances on lines of credit of $40.1 million, partially offset by pay-downs and pay-offs of $110.9 million. The increase for the current year-to-date period was primarily due to new funding of $278.9 million and advances of lines of credit of $69.3 million, partially offset by pay-downs and pay-offs of $247.3 million. SBA PPP loans of $21.3 million and $63.7 million were paid off through regular payments or forgiveness from SBA during the current quarter and year-to-date period, respectively.
The decrease in loans held-for-sale for the current quarter was primarily due to sales of $38.4 million, partially offset by new funding of $29.9 million. The decrease for the current year-to-date period was primarily due to sales of $78.1 million, partially offset by new funding of $51.1 million.
The following table presents a composition of commitments to extend credit as of the dates indicated:
($ in thousands) |
6/30/2022 |
3/31/2022 |
% Change |
12/31/2021 |
% Change |
6/30/2021 |
% Change |
||||||||||||||
Real estate loans |
|||||||||||||||||||||
Commercial property |
$ |
20,425 |
$ |
21,195 |
(3.6 |
)% |
$ |
20,194 |
1.1 |
% |
$ |
15,277 |
33.7 |
% |
|||||||
SBA property |
4,265 |
3,142 |
35.7 |
% |
3,068 |
39.0 |
% |
6,191 |
(31.1 |
)% |
|||||||||||
Construction |
12,080 |
6,528 |
85.0 |
% |
5,180 |
133.2 |
% |
6,233 |
93.8 |
% |
|||||||||||
Commercial and industrial loans |
|||||||||||||||||||||
Commercial term |
2,347 |
2,674 |
(12.2 |
)% |
1,097 |
113.9 |
% |
2,950 |
(20.4 |
)% |
|||||||||||
Commercial lines of credit |
218,850 |
175,742 |
24.5 |
% |
169,000 |
29.5 |
% |
164,648 |
32.9 |
% |
|||||||||||
SBA commercial term |
383 |
950 |
(59.7 |
)% |
149 |
157.0 |
% |
— |
— |
% |
|||||||||||
Other consumer loans |
1,086 |
1,080 |
0.6 |
% |
595 |
82.5 |
% |
118 |
820.3 |
% |
|||||||||||
Total commitments to extend credit |
$ |
259,436 |
$ |
211,311 |
22.8 |
% |
$ |
199,283 |
30.2 |
% |
$ |
195,417 |
32.8 |
% |
|||||||
Credit Quality
The following table presents a summary of non-performing loans, non-performing assets and classified assets as of the dates indicated:
($ in thousands) |
6/30/2022 |
3/31/2022 |
% Change |
12/31/2021 |
% Change |
6/30/2021 |
% Change |
||||||||||||||||||
Nonaccrual loans |
|||||||||||||||||||||||||
Real estate loans |
|||||||||||||||||||||||||
Residential property |
$ |
450 |
$ |
461 |
(2.4 |
)% |
$ |
— |
— |
% |
$ |
— |
— |
% |
|||||||||||
SBA property |
564 |
733 |
(23.1 |
)% |
746 |
(24.4 |
)% |
781 |
(27.8 |
)% |
|||||||||||||||
Commercial and industrial loans |
|||||||||||||||||||||||||
SBA commercial term |
185 |
199 |
(7.0 |
)% |
213 |
(13.1 |
)% |
600 |
(69.2 |
)% |
|||||||||||||||
Other consumer loans |
24 |
25 |
(4.0 |
)% |
35 |
(31.4 |
)% |
65 |
(63.1 |
)% |
|||||||||||||||
Total nonaccrual loans held-for-investment |
1,223 |
1,418 |
(13.8 |
)% |
994 |
23.0 |
% |
1,446 |
(15.4 |
)% |
|||||||||||||||
Loans past due 90 days or more and still accruing |
— |
— |
— |
% |
— |
— |
% |
— |
— |
% |
|||||||||||||||
Non-performing loans (“NPLs”) |
1,223 |
1,418 |
(13.8 |
)% |
994 |
23.0 |
% |
1,446 |
(15.4 |
)% |
|||||||||||||||
Other real estate owned (“OREO”) |
808 |
— |
— |
% |
— |
— |
% |
— |
— |
% |
|||||||||||||||
Non-performing assets (“NPAs”) |
$ |
2,031 |
$ |
1,418 |
43.2 |
% |
$ |
994 |
104.3 |
% |
$ |
1,446 |
40.5 |
% |
|||||||||||
Loans past due and still accruing |
|||||||||||||||||||||||||
Past due 30 to 59 days |
$ |
682 |
$ |
119 |
473.1 |
% |
$ |
549 |
24.2 |
% |
$ |
227 |
200.4 |
% |
|||||||||||
Past due 60 to 89 days |
— |
1 |
(100.0 |
)% |
5 |
(100.0 |
)% |
— |
— |
% |
|||||||||||||||
Past due 90 days or more |
— |
— |
— |
% |
— |
— |
% |
— |
— |
% |
|||||||||||||||
Total loans past due and still accruing |
$ |
682 |
$ |
120 |
468.3 |
% |
554 |
23.1 |
% |
$ |
227 |
200.4 |
% |
||||||||||||
Troubled debt restructurings (“TDRs”) |
|||||||||||||||||||||||||
Accruing TDRs |
$ |
555 |
$ |
565 |
(1.8 |
)% |
$ |
576 |
(3.6 |
)% |
$ |
605 |
(8.3 |
)% |
|||||||||||
Nonaccrual TDRs |
10 |
15 |
(33.3 |
)% |
17 |
(41.2 |
)% |
30 |
(66.7 |
)% |
|||||||||||||||
Total TDRs |
$ |
565 |
$ |
580 |
(2.6 |
)% |
$ |
593 |
(4.7 |
)% |
$ |
635 |
(11.0 |
)% |
|||||||||||
Special mention loans |
$ |
6,313 |
$ |
5,562 |
13.5 |
% |
$ |
18,092 |
(65.1 |
)% |
$ |
18,238 |
(65.4 |
)% |
|||||||||||
Classified assets |
|||||||||||||||||||||||||
Classified loans |
$ |
3,980 |
$ |
5,377 |
(26.0 |
)% |
$ |
5,168 |
(23.0 |
)% |
$ |
9,666 |
(58.8 |
)% |
|||||||||||
OREO |
808 |
— |
— |
% |
— |
— |
% |
— |
— |
% |
|||||||||||||||
Classified assets |
$ |
4,788 |
$ |
5,377 |
(11.0 |
)% |
$ |
5,168 |
(7.4 |
)% |
$ |
9,666 |
(50.5 |
)% |
|||||||||||
NPLs to loans held-for-investment |
0.07 |
% |
0.08 |
% |
0.06 |
% |
0.08 |
% |
|||||||||||||||||
NPAs to total assets |
0.09 |
% |
0.06 |
% |
0.05 |
% |
0.07 |
% |
|||||||||||||||||
Classified assets to total assets |
0.20 |
% |
0.24 |
% |
0.24 |
% |
0.47 |
% |
|||||||||||||||||
Loan Modifications Related to the COVID-19 Pandemic
The Company had provided modifications, including interest only payments or payment deferrals, to customers that were adversely affected by the COVID-19 pandemic. The loan modifications met all criteria under the Coronavirus Aid, Relief, and Economic Security Act. Therefore, the modified loans were not considered TDRs. As of June 30, 2022 and March 31, 2022, the Company had no loans under modified terms related to the COVID-19 pandemic. Total loans under modified terms related to the COVID-19 pandemic totaled $16.2 million at June 30, 2021.
The Company had classified the loans that were granted modifications related to the COVID-19 pandemic in excess of 6 months on a cumulative basis as special mention or classified. Special mention and classified loans included $4.0 million and $1.5 million, respectively, at June 30, 2022, $4.1 million and $2.7 million, respectively, at March 31, 2022, $15.6 million and $2.7 million, respectively, December 31, 2021, and $16.4 million and $6.2 million, respectively, at June 30, 2021, of the loans that were granted such modifications.
Investment Securities
Total investment securities were $139.1 million at June 30, 2022, an increase of $7.7 million, or 5.9%, from $131.3 million at March 31, 2022, an increase of $15.9 million, or 12.9%, from $123.2 million at December 31, 2021, and an increase of $3.6 million, or 2.6%, from $135.5 million at June 30, 2021. The increase for the current quarter was primarily due to purchases of $18.1 million, partially offset by principal pay-downs and calls of $6.2 million, a fair value decrease of $4.1 million, and net premium amortization of $97 thousand. The increase for the current year-to-date period was primarily due to purchases of $38.0 million, partially offset by principal pay-downs and calls of $12.3 million, a fair value decrease of $9.6 million, and net premium amortization of $232 thousand.
Deposits
The following table presents the Company’s deposit mix as of the dates indicated:
6/30/2022 |
3/31/2022 |
12/31/2021 |
6/30/2021 |
|||||||||||||||||||||
($ in thousands) |
Amount |
% to Total |
Amount |
% to Total |
Amount |
% to Total |
Amount |
% to Total |
||||||||||||||||
Noninterest-bearing demand deposits |
$ |
988,454 |
49.5 |
% |
$ |
891,797 |
46.7 |
% |
$ |
830,383 |
44.5 |
% |
$ |
795,741 |
44.3 |
% |
||||||||
Interest-bearing deposits |
||||||||||||||||||||||||
Savings |
14,686 |
0.7 |
% |
15,037 |
0.8 |
% |
16,299 |
0.9 |
% |
11,671 |
0.6 |
% |
||||||||||||
NOW |
18,881 |
0.9 |
% |
17,543 |
0.9 |
% |
20,185 |
1.1 |
% |
21,725 |
1.2 |
% |
||||||||||||
Retail money market accounts |
458,605 |
22.9 |
% |
431,057 |
22.5 |
% |
386,041 |
20.5 |
% |
358,575 |
19.9 |
% |
||||||||||||
Brokered money market accounts |
1 |
0.1 |
% |
1 |
0.1 |
% |
1 |
0.1 |
% |
4 |
0.1 |
% |
||||||||||||
Retail time deposits of |
||||||||||||||||||||||||
$250,000 or less |
235,956 |
11.8 |
% |
246,100 |
12.8 |
% |
256,956 |
13.8 |
% |
271,531 |
15.1 |
% |
||||||||||||
More than $250,000 |
186,024 |
9.3 |
% |
173,844 |
9.1 |
% |
172,269 |
9.2 |
% |
173,401 |
9.6 |
% |
||||||||||||
State and brokered time deposits |
95,000 |
4.8 |
% |
135,000 |
7.1 |
% |
185,000 |
9.9 |
% |
165,000 |
9.2 |
% |
||||||||||||
Total interest-bearing deposits |
1,009,153 |
50.5 |
% |
1,018,582 |
53.3 |
% |
1,036,751 |
55.5 |
% |
1,001,907 |
55.7 |
% |
||||||||||||
Total deposits |
$ |
1,997,607 |
100.0 |
% |
$ |
1,910,379 |
100.0 |
% |
$ |
1,867,134 |
100.0 |
% |
$ |
1,797,648 |
100.0 |
% |
||||||||
The increases in noninterest-bearing demand deposits and retail money market accounts for the current quarter and year-to-date period were primarily due to the overall liquid deposit market.
The increase in retail time deposits for the current quarter was primarily due to new accounts of $68.8 million, renewals of the matured accounts of $154.0 million and balance increases of $4.4 million, partially offset by matured and closed accounts of $225.2 million. The decrease for the current year was primarily due to matured and closed accounts of $413.7 million, partially offset by new accounts of $99.4 million, renewals of the matured accounts of $297.6 million and balance increases of $9.5 million.
Liquidity
The following table presents a summary of the Company’s liquidity position as of June 30, 2022:
($ in thousands) |
6/30/2022 |
|||
Cash and cash equivalents |
$ |
299,910 |
||
Cash and cash equivalents to total assets |
12.8 |
% |
||
Available borrowing capacity |
||||
FHLB advances |
$ |
549,920 |
||
Federal Reserve Discount Window |
21,955 |
|||
Overnight federal funds lines |
65,000 |
|||
Total |
$ |
636,875 |
||
Total available borrowing capacity to total assets |
27.2 |
% |
||
Shareholders’ Equity
Shareholders’ equity was $334.4 million at June 30, 2022, an increase of $73.3 million, or 28.1%, from $261.1 million at March 31, 2022, an increase of $78.1 million, or 30.5%, from $256.3 million at December 31, 2021, and an increase of $95.4 million, or 39.9%, from $238.9 million at June 30, 2021. The increases for the current quarter and year-to-date period were primarily due to net income and issuance of preferred stock (as discussed below), partially offset by cash dividends declared on common stock and a decrease in accumulated other comprehensive income (loss). The Company declared cash dividends of $2.2 million and $4.5 million for the current quarter and year-to-date period, respectively.
Stock Repurchase
On April 8, 2021, the Company’s Board of Directors approved a repurchase program authorizing the repurchase of up to 5% of the Company’s outstanding common stock as of the date of the board meeting, which represented 775,000 shares, through September 7, 2021. The Company repurchased and retired 680,269 shares of common stock totaling $10.9 million at a weighted-average price of $15.99 per share under this program.
Issuance of Preferred Stock Under the Emergency Capital Investment Program
On May 24, 2022, the Company issued 69,141 shares of Senior Non-Cumulative Perpetual Preferred Stock, Series C, liquidation preference of $1,000 per share (“Series C Preferred Stock”) for the capital investment of $69.1 million from the U.S. Treasury under the ECIP. ECIP investment is treated as tier 1 capital for regulatory capital purposes.
The Series C Preferred Stock bears no dividend for the first 24 months following the investment date. Thereafter, the dividend rate will be adjusted based on the lending growth criteria listed in the terms of the ECIP investment with an annual dividend rate up to 2%. After the tenth anniversary of the investment date, the dividend rate will be fixed based on average annual amount of lending in years 2 through 10. Dividends will be payable quarterly in arrears on March 15, June 15, September 15, and December 15.
The Series C Preferred Stock may be redeemed at the option of the Company on or after the fifth anniversary of issuance (or earlier in the event of loss of regulatory capital treatment), subject to the approval of the appropriate federal banking regulator and in accordance with the federal banking agencies’ regulatory capital regulations.
Established by the Consolidated Appropriations Act, 2021, the ECIP was created to encourage low- and moderate-income community financial institutions and minority depository institutions to provide loans, grants, and forbearance for small businesses, minority-owned businesses, and consumers, especially low-income and underserved communities, including persistent poverty counties, that may be disproportionately impacted by the economic effect of the COVID-19 pandemic by providing direct and indirect capital investments in low- and moderate-income community financial institutions.
Capital Ratios
Based on changes to the Federal Reserve’s definition of a “Small Bank Holding Company” that increased the threshold to $3 billion in assets in August 2018, the Company is not currently subject to separate minimum capital measurements. At such time as the Company reaches the $3 billion asset level, it will again be subject to capital measurements independent of the Bank. For comparison purposes, the Company’s ratios are included in following discussion. The following table presents capital ratios for the Company and the Bank as of dates indicated:
6/30/2022 |
3/31/2022 |
12/31/2021 |
6/30/2021 |
Well Capitalized Requirements |
|||||||||||
PCB Bancorp |
|||||||||||||||
Common tier 1 capital (to risk-weighted assets) |
14.44 |
% |
14.77 |
% |
14.79 |
% |
15.17 |
% |
N/A |
||||||
Total capital (to risk-weighted assets) |
19.25 |
% |
15.97 |
% |
16.04 |
% |
16.43 |
% |
N/A |
||||||
Tier 1 capital (to risk-weighted assets) |
18.11 |
% |
14.77 |
% |
14.79 |
% |
15.17 |
% |
N/A |
||||||
Tier 1 capital (to average assets) |
15.37 |
% |
12.22 |
% |
12.11 |
% |
11.76 |
% |
N/A |
||||||
Pacific City Bank |
|||||||||||||||
Common tier 1 capital (to risk-weighted assets) |
17.79 |
% |
14.43 |
% |
14.48 |
% |
14.88 |
% |
6.5 |
% |
|||||
Total capital (to risk-weighted assets) |
18.92 |
% |
15.63 |
% |
15.73 |
% |
16.13 |
% |
10.0 |
% |
|||||
Tier 1 capital (to risk-weighted assets) |
17.79 |
% |
14.43 |
% |
14.48 |
% |
14.88 |
% |
8.0 |
% |
|||||
Tier 1 capital (to average assets) |
15.09 |
% |
11.94 |
% |
11.85 |
% |
11.53 |
% |
5.0 |
% |
|||||
Name Change of Pacific City Bank to PCB Bank
On August 25, 2022, the Pacific City Bank will change its name to PCB Bank. In addition, the Company introduced a new logo, which will also be utilized by the Bank after its name change. In accordance with the name change, the Bank will update its website, branch signage and marketing collateral.
“As we continued to grow and expand our national presence, we felt that now is a good time to announce our new name which is better suited to the broad geographic reach of our institution now and in the future,” stated Henry Kim, President and Chief Executive Officer.
About PCB Bancorp
PCB Bancorp is the bank holding company for Pacific City Bank, a California state chartered bank, offering a full suite of commercial banking services to small to medium-sized businesses, individuals and professionals, primarily in Southern California, and predominantly in Korean-American and other minority communities.
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements. These forward-looking statements represent plans, estimates, objectives, goals, guidelines, expectations, intentions, projections and statements of our beliefs concerning future events, business plans, objectives, expected operating results and the assumptions upon which those statements are based. Forward-looking statements include without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements, and are typically identified with words such as “may,” “could,” “should,” “will,” “would,” “believe,” “anticipate,” “estimate,” “expect,” “aim,” “intend,” “plan,” or words or phases of similar meaning. We caution that the forward-looking statements are based largely on our expectations and are subject to a number of known and unknown risks and uncertainties that are subject to change based on factors which are, in many instances, beyond our control, including but not limited to general economic uncertainty in the United States and abroad, the impact of inflation, changes in interest rates (including actions taken by the Federal Reserve to address inflation), deposit flows, and real estate values, and their corresponding impact on our customers, and the network and data incident discovered on August 30, 2021. These and other important factors are detailed in various securities law filings made periodically by the Company, copies of which are available from the Company without charge. Actual results, performance or achievements could differ materially from those contemplated, expressed, or implied by the forward-looking statements. Any forward-looking statements presented herein are made only as of the date of this press release, and we do not undertake any obligation to update or revise any forward-looking statements to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise, except as required by law.
PCB Bancorp and Subsidiary Consolidated Balance Sheets (Unaudited) ($ in thousands, except share and per share data) |
|||||||||||||||||||||||||
6/30/2022 |
3/31/2022 |
% Change |
12/31/2021 |
% Change |
6/30/2021 |
% Change |
|||||||||||||||||||
Assets |
|||||||||||||||||||||||||
Cash and due from banks |
$ |
23,125 |
$ |
19,693 |
17.4 |
% |
$ |
15,222 |
51.9 |
% |
$ |
18,417 |
25.6 |
% |
|||||||||||
Interest-bearing deposits in other financial institutions |
276,785 |
230,519 |
20.1 |
% |
188,063 |
47.2 |
% |
156,204 |
77.2 |
% |
|||||||||||||||
Total cash and cash equivalents |
299,910 |
250,212 |
19.9 |
% |
203,285 |
47.5 |
% |
174,621 |
71.7 |
% |
|||||||||||||||
Securities available-for-sale, at fair value |
139,067 |
131,345 |
5.9 |
% |
123,198 |
12.9 |
% |
135,479 |
2.6 |
% |
|||||||||||||||
Loans held-for-sale |
9,627 |
18,340 |
(47.5 |
)% |
37,026 |
(74.0 |
)% |
11,255 |
(14.5 |
)% |
|||||||||||||||
Loans held-for-investment |
1,833,010 |
1,742,955 |
5.2 |
% |
1,732,205 |
5.8 |
% |
1,719,656 |
6.6 |
% |
|||||||||||||||
Allowance for loan losses |
(21,071 |
) |
(21,198 |
) |
(0.6 |
)% |
(22,381 |
) |
(5.9 |
)% |
(24,889 |
) |
(15.3 |
)% |
|||||||||||
Net loans held-for-investment |
1,811,939 |
1,721,757 |
5.2 |
% |
1,709,824 |
6.0 |
% |
1,694,767 |
6.9 |
% |
|||||||||||||||
Premises and equipment, net |
3,633 |
3,106 |
17.0 |
% |
3,098 |
17.3 |
% |
3,576 |
1.6 |
% |
|||||||||||||||
Federal Home Loan Bank and other bank stock |
10,183 |
8,577 |
18.7 |
% |
8,577 |
18.7 |
% |
8,577 |
18.7 |
% |
|||||||||||||||
Other real estate owned, net |
808 |
— |
— |
% |
— |
— |
% |
— |
— |
% |
|||||||||||||||
Bank-owned life insurance |
29,705 |
29,530 |
0.6 |
% |
29,358 |
1.2 |
% |
— |
— |
% |
|||||||||||||||
Deferred tax assets, net |
11,869 |
11,895 |
(0.2 |
)% |
10,824 |
9.7 |
% |
7,892 |
50.4 |
% |
|||||||||||||||
Servicing assets |
7,716 |
7,533 |
2.4 |
% |
7,269 |
6.1 |
% |
6,482 |
19.0 |
% |
|||||||||||||||
Operating lease assets |
6,512 |
6,511 |
— |
% |
6,786 |
(4.0 |
)% |
6,595 |
(1.3 |
)% |
|||||||||||||||
Accrued interest receivable |
5,212 |
5,050 |
3.2 |
% |
5,368 |
(2.9 |
)% |
6,741 |
(22.7 |
)% |
|||||||||||||||
Other assets |
8,379 |
5,886 |
42.4 |
% |
5,122 |
63.6 |
% |
4,018 |
108.5 |
% |
|||||||||||||||
Total assets |
$ |
2,344,560 |
$ |
2,199,742 |
6.6 |
% |
$ |
2,149,735 |
9.1 |
% |
$ |
2,060,003 |
13.8 |
% |
|||||||||||
Liabilities |
|||||||||||||||||||||||||
Deposits |
|||||||||||||||||||||||||
Noninterest-bearing demand |
$ |
988,454 |
$ |
891,797 |
10.8 |
% |
$ |
830,383 |
19.0 |
% |
$ |
795,741 |
24.2 |
% |
|||||||||||
Savings, NOW and money market accounts |
492,173 |
463,638 |
6.2 |
% |
422,526 |
16.5 |
% |
391,975 |
25.6 |
% |
|||||||||||||||
Time deposits of $250,000 or less |
270,956 |
281,100 |
(3.6 |
)% |
341,956 |
(20.8 |
)% |
336,531 |
(19.5 |
)% |
|||||||||||||||
Time deposits of more than $250,000 |
246,024 |
273,844 |
(10.2 |
)% |
272,269 |
(9.6 |
)% |
273,401 |
(10.0 |
)% |
|||||||||||||||
Total deposits |
1,997,607 |
1,910,379 |
4.6 |
% |
1,867,134 |
7.0 |
% |
1,797,648 |
11.1 |
% |
|||||||||||||||
Federal Home Loan Bank advances |
— |
10,000 |
(100.0 |
)% |
10,000 |
(100.0 |
)% |
10,000 |
(100.0 |
)% |
|||||||||||||||
Operating lease liabilities |
7,067 |
7,176 |
(1.5 |
)% |
7,444 |
(5.1 |
)% |
7,338 |
(3.7 |
)% |
|||||||||||||||
Accrued interest payable and other liabilities |
5,511 |
11,129 |
(50.5 |
)% |
8,871 |
(37.9 |
)% |
6,076 |
(9.3 |
)% |
|||||||||||||||
Total liabilities |
2,010,185 |
1,938,684 |
3.7 |
% |
1,893,449 |
6.2 |
% |
1,821,062 |
10.4 |
% |
|||||||||||||||
Commitments and contingent liabilities |
|||||||||||||||||||||||||
Shareholders’ equity |
|||||||||||||||||||||||||
Preferred stock |
69,141 |
— |
— |
% |
— |
— |
% |
— |
— |
% |
|||||||||||||||
Common stock |
155,842 |
155,614 |
0.1 |
% |
154,992 |
0.5 |
% |
154,796 |
0.7 |
% |
|||||||||||||||
Retained earnings |
115,992 |
109,142 |
6.3 |
% |
101,140 |
14.7 |
% |
83,002 |
39.7 |
% |
|||||||||||||||
Accumulated other comprehensive income (loss), net |
(6,600 |
) |
(3,698 |
) |
NM |
154 |
NM |
1,143 |
NM |
||||||||||||||||
Total shareholders’ equity |
334,375 |
261,058 |
28.1 |
% |
256,286 |
30.5 |
% |
238,941 |
39.9 |
% |
|||||||||||||||
Total liabilities and shareholders’ equity |
$ |
2,344,560 |
$ |
2,199,742 |
6.6 |
% |
$ |
2,149,735 |
9.1 |
% |
$ |
2,060,003 |
13.8 |
% |
|||||||||||
Outstanding common shares |
14,956,760 |
14,944,663 |
14,865,825 |
14,854,315 |
|||||||||||||||||||||
Book value per common share (1) |
$ |
22.36 |
$ |
17.47 |
$ |
17.24 |
$ |
16.09 |
|||||||||||||||||
TCE per common share (2) |
$ |
17.73 |
$ |
17.47 |
$ |
17.24 |
$ |
16.09 |
|||||||||||||||||
Total loan to total deposit ratio |
92.24 |
% |
92.20 |
% |
94.76 |
% |
96.29 |
% |
|||||||||||||||||
Noninterest-bearing deposits to total deposits |
49.48 |
% |
46.68 |
% |
44.47 |
% |
44.27 |
% |
|||||||||||||||||
(1) |
The ratios are calculated by dividing total shareholders’ equity by the number of outstanding common shares. The Company did not have any intangible equity components for the presented periods. |
|
(2) |
Non-GAAP. See “Non-GAAP Measures” for reconciliation of this measure to its most comparable GAAP measure. |
PCB Bancorp and Subsidiary Consolidated Statements of Income (Unaudited) ($ in thousands, except share and per share data) |
|||||||||||||||||||||||||||||
Three Months Ended |
Six Months Ended |
||||||||||||||||||||||||||||
6/30/2022 |
3/31/2022 |
% Change |
6/30/2021 |
% Change |
6/30/2022 |
6/30/2021 |
% Change |
||||||||||||||||||||||
Interest and dividend income |
|||||||||||||||||||||||||||||
Loans, including fees |
$ |
21,243 |
$ |
20,190 |
5.2 |
% |
$ |
19,511 |
8.9 |
% |
$ |
41,433 |
$ |
38,255 |
8.3 |
% |
|||||||||||||
Investment securities |
668 |
476 |
40.3 |
% |
375 |
78.1 |
% |
1,144 |
735 |
55.6 |
% |
||||||||||||||||||
Other interest-earning assets |
535 |
228 |
134.6 |
% |
165 |
224.2 |
% |
763 |
319 |
139.2 |
% |
||||||||||||||||||
Total interest income |
22,446 |
20,894 |
7.4 |
% |
20,051 |
11.9 |
% |
43,340 |
39,309 |
10.3 |
% |
||||||||||||||||||
Interest expense |
|||||||||||||||||||||||||||||
Deposits |
1,041 |
850 |
22.5 |
% |
1,000 |
4.1 |
% |
1,891 |
2,311 |
(18.2 |
)% |
||||||||||||||||||
Other borrowings |
54 |
51 |
5.9 |
% |
55 |
(1.8 |
)% |
105 |
183 |
(42.6 |
)% |
||||||||||||||||||
Total interest expense |
1,095 |
901 |
21.5 |
% |
1,055 |
3.8 |
% |
1,996 |
2,494 |
(20.0 |
)% |
||||||||||||||||||
Net interest income |
21,351 |
19,993 |
6.8 |
% |
18,996 |
12.4 |
% |
41,344 |
36,815 |
12.3 |
% |
||||||||||||||||||
Reversal for loan losses |
(109 |
) |
(1,191 |
) |
(90.8 |
)% |
(934 |
) |
(88.3 |
)% |
(1,300 |
) |
(2,081 |
) |
(37.5 |
)% |
|||||||||||||
Net interest income after reversal for loan losses |
21,460 |
21,184 |
1.3 |
% |
19,930 |
7.7 |
% |
42,644 |
38,896 |
9.6 |
% |
||||||||||||||||||
Noninterest income |
|||||||||||||||||||||||||||||
Gain on sale of loans |
2,039 |
3,777 |
(46.0 |
)% |
3,967 |
(48.6 |
)% |
5,816 |
5,289 |
10.0 |
% |
||||||||||||||||||
Service charges and fees on deposits |
330 |
303 |
8.9 |
% |
302 |
9.3 |
% |
633 |
595 |
6.4 |
% |
||||||||||||||||||
Loan servicing income |
755 |
700 |
7.9 |
% |
545 |
38.5 |
% |
1,455 |
1,427 |
2.0 |
% |
||||||||||||||||||
Bank-owned life insurance income |
175 |
172 |
1.7 |
% |
— |
— |
% |
347 |
— |
— |
% |
||||||||||||||||||
Other income |
349 |
334 |
4.5 |
% |
337 |
3.6 |
% |
683 |
697 |
(2.0 |
)% |
||||||||||||||||||
Total noninterest income |
3,648 |
5,286 |
(31.0 |
)% |
5,151 |
(29.2 |
)% |
8,934 |
8,008 |
11.6 |
% |
||||||||||||||||||
Noninterest expense |
|||||||||||||||||||||||||||||
Salaries and employee benefits |
8,125 |
8,595 |
(5.5 |
)% |
7,125 |
14.0 |
% |
16,720 |
13,307 |
25.6 |
% |
||||||||||||||||||
Occupancy and equipment |
1,537 |
1,397 |
10.0 |
% |
1,388 |
10.7 |
% |
2,934 |
2,759 |
6.3 |
% |
||||||||||||||||||
Professional fees |
642 |
403 |
59.3 |
% |
658 |
(2.4 |
)% |
1,045 |
1,152 |
(9.3 |
)% |
||||||||||||||||||
Marketing and business promotion |
310 |
207 |
49.8 |
% |
516 |
(39.9 |
)% |
517 |
654 |
(20.9 |
)% |
||||||||||||||||||
Data processing |
441 |
404 |
9.2 |
% |
396 |
11.4 |
% |
845 |
773 |
9.3 |
% |
||||||||||||||||||
Director fees and expenses |
182 |
169 |
7.7 |
% |
151 |
20.5 |
% |
351 |
289 |
21.5 |
% |
||||||||||||||||||
Regulatory assessments |
147 |
141 |
4.3 |
% |
179 |
(17.9 |
)% |
288 |
387 |
(25.6 |
)% |
||||||||||||||||||
Other expense |
861 |
755 |
14.0 |
% |
726 |
18.6 |
% |
1,616 |
1,487 |
8.7 |
% |
||||||||||||||||||
Total noninterest expense |
12,245 |
12,071 |
1.4 |
% |
11,139 |
9.9 |
% |
24,316 |
20,808 |
16.9 |
% |
||||||||||||||||||
Income before income taxes |
12,863 |
14,399 |
(10.7 |
)% |
13,942 |
(7.7 |
)% |
27,262 |
26,096 |
4.5 |
% |
||||||||||||||||||
Income tax expense |
3,771 |
4,159 |
(9.3 |
)% |
4,098 |
(8.0 |
)% |
7,930 |
7,692 |
3.1 |
% |
||||||||||||||||||
Net income |
$ |
9,092 |
$ |
10,240 |
(11.2 |
)% |
$ |
9,844 |
(7.6 |
)% |
$ |
19,332 |
$ |
18,404 |
5.0 |
% |
|||||||||||||
Earnings per common share |
|||||||||||||||||||||||||||||
Basic |
$ |
0.61 |
$ |
0.69 |
$ |
0.65 |
$ |
1.29 |
$ |
1.20 |
|||||||||||||||||||
Diluted |
$ |
0.60 |
$ |
0.67 |
$ |
0.64 |
$ |
1.27 |
$ |
1.19 |
|||||||||||||||||||
Average common shares |
|||||||||||||||||||||||||||||
Basic |
14,883,768 |
14,848,014 |
15,115,561 |
14,865,990 |
15,249,210 |
||||||||||||||||||||||||
Diluted |
15,122,452 |
15,141,693 |
15,309,873 |
15,138,493 |
15,425,308 |
||||||||||||||||||||||||
Dividend paid per common share |
$ |
0.15 |
$ |
0.15 |
$ |
0.10 |
$ |
0.30 |
$ |
0.20 |
|||||||||||||||||||
Return on average assets (1) |
1.65 |
% |
1.92 |
% |
1.96 |
% |
1.78 |
% |
1.85 |
% |
|||||||||||||||||||
Return on average shareholders’ equity (1) |
12.48 |
% |
16.01 |
% |
16.49 |
% |
14.13 |
% |
15.59 |
% |
|||||||||||||||||||
Return on average TCE (1), (2) |
13.85 |
% |
16.01 |
% |
16.49 |
% |
14.92 |
% |
15.59 |
% |
|||||||||||||||||||
Efficiency ratio (3) |
48.98 |
% |
47.75 |
% |
46.13 |
% |
48.36 |
% |
46.42 |
% |
|||||||||||||||||||
(1) |
Ratios are presented on an annualized basis. |
|
(2) |
Non-GAAP. See “Non-GAAP Measures” for reconciliation of this measure to its most comparable GAAP measure. |
|
(3) |
The ratios are calculated by dividing noninterest expense by the sum of net interest income and noninterest income. |
PCB Bancorp and Subsidiary Average Balance, Average Yield, and Average Rate (Unaudited) ($ in thousands) |
||||||||||||||||||||||||||||||
Three Months Ended |
||||||||||||||||||||||||||||||
6/30/2022 |
3/31/2022 |
6/30/2021 |
||||||||||||||||||||||||||||
Average Balance |
Interest Income/ Expense |
Avg. Yield/Rate(6) |
Average Balance |
Interest Income/ Expense |
Avg. Yield/Rate(6) |
Average Balance |
Interest Income/ Expense |
Avg. Yield/Rate(6) |
||||||||||||||||||||||
Assets |
||||||||||||||||||||||||||||||
Interest-earning assets |
||||||||||||||||||||||||||||||
Total loans (1) |
$ |
1,804,368 |
$ |
21,243 |
4.72 |
% |
$ |
1,773,376 |
$ |
20,190 |
4.62 |
% |
$ |
1,691,704 |
$ |
19,511 |
4.63 |
% |
||||||||||||
Mortgage-backed securities |
88,032 |
416 |
1.90 |
% |
84,223 |
307 |
1.48 |
% |
92,732 |
233 |
1.01 |
% |
||||||||||||||||||
Collateralized mortgage obligation |
25,929 |
125 |
1.93 |
% |
18,242 |
48 |
1.07 |
% |
22,929 |
54 |
0.94 |
% |
||||||||||||||||||
SBA loan pool securities |
11,164 |
43 |
1.54 |
% |
10,095 |
38 |
1.53 |
% |
10,828 |
51 |
1.89 |
% |
||||||||||||||||||
Municipal bonds (2) |
5,347 |
37 |
2.78 |
% |
5,632 |
36 |
2.59 |
% |
5,760 |
37 |
2.58 |
% |
||||||||||||||||||
Corporate bonds |
4,852 |
47 |
3.89 |
% |
5,038 |
47 |
3.78 |
% |
— |
— |
— |
% |
||||||||||||||||||
Other interest-earning assets |
195,633 |
535 |
1.10 |
% |
198,918 |
228 |
0.46 |
% |
164,710 |
165 |
0.40 |
% |
||||||||||||||||||
Total interest-earning assets |
2,135,325 |
22,446 |
4.22 |
% |
2,095,524 |
20,894 |
4.04 |
% |
1,988,663 |
20,051 |
4.04 |
% |
||||||||||||||||||
Noninterest-earning assets |
||||||||||||||||||||||||||||||
Cash and due from banks |
20,801 |
20,385 |
19,080 |
|||||||||||||||||||||||||||
Allowance for loan losses |
(21,204 |
) |
(22,377 |
) |
(25,559 |
) |
||||||||||||||||||||||||
Other assets |
73,137 |
67,600 |
36,605 |
|||||||||||||||||||||||||||
Total noninterest-earning assets |
72,734 |
65,608 |
30,126 |
|||||||||||||||||||||||||||
Total assets |
$ |
2,208,059 |
$ |
2,161,132 |
$ |
2,018,789 |
||||||||||||||||||||||||
Liabilities and Shareholders’ Equity |
||||||||||||||||||||||||||||||
Interest-bearing liabilities |
||||||||||||||||||||||||||||||
Deposits |
||||||||||||||||||||||||||||||
NOW and money market accounts |
$ |
464,829 |
430 |
0.37 |
% |
$ |
431,981 |
313 |
0.29 |
% |
$ |
400,314 |
317 |
0.32 |
% |
|||||||||||||||
Savings |
14,989 |
2 |
0.05 |
% |
15,644 |
2 |
0.05 |
% |
11,588 |
1 |
0.03 |
% |
||||||||||||||||||
Time deposits |
521,606 |
609 |
0.47 |
% |
586,387 |
535 |
0.37 |
% |
615,035 |
682 |
0.44 |
% |
||||||||||||||||||
Total interest-bearing deposits |
1,001,424 |
1,041 |
0.42 |
% |
1,034,012 |
850 |
0.33 |
% |
1,026,937 |
1,000 |
0.39 |
% |
||||||||||||||||||
Other borrowings |
11,132 |
54 |
1.95 |
% |
10,400 |
51 |
1.99 |
% |
19,012 |
55 |
1.16 |
% |
||||||||||||||||||
Total interest-bearing liabilities |
1,012,556 |
1,095 |
0.43 |
% |
1,044,412 |
901 |
0.35 |
% |
1,045,949 |
1,055 |
0.40 |
% |
||||||||||||||||||
Noninterest-bearing liabilities |
||||||||||||||||||||||||||||||
Noninterest-bearing demand |
889,691 |
840,626 |
720,105 |
|||||||||||||||||||||||||||
Other liabilities |
13,677 |
16,727 |
13,287 |
|||||||||||||||||||||||||||
Total noninterest-bearing liabilities |
903,368 |
857,353 |
733,392 |
|||||||||||||||||||||||||||
Total liabilities |
1,915,924 |
1,901,765 |
1,779,341 |
|||||||||||||||||||||||||||
Total shareholders’ equity |
292,135 |
259,367 |
239,448 |
|||||||||||||||||||||||||||
Total liabilities and shareholders’ equity |
$ |
2,208,059 |
$ |
2,161,132 |
$ |
2,018,789 |
||||||||||||||||||||||||
Net interest income |
$ |
21,351 |
$ |
19,993 |
$ |
18,996 |
||||||||||||||||||||||||
Net interest spread (3) |
3.79 |
% |
3.69 |
% |
3.64 |
% |
||||||||||||||||||||||||
Net interest margin (4) |
4.01 |
% |
3.87 |
% |
3.83 |
% |
||||||||||||||||||||||||
Total deposits |
$ |
1,891,115 |
$ |
1,041 |
0.22 |
% |
$ |
1,874,638 |
$ |
850 |
0.18 |
% |
$ |
1,747,042 |
$ |
1,000 |
0.23 |
% |
||||||||||||
Total funding (5) |
$ |
1,902,247 |
$ |
1,095 |
0.23 |
% |
$ |
1,885,038 |
$ |
901 |
0.19 |
% |
$ |
1,766,054 |
$ |
1,055 |
0.24 |
% |
||||||||||||
(1) |
Total loans include both loans held-for-sale and loans held-for-investment, net of deferred loan fees and costs. |
|
(2) |
The yield on municipal bonds has not been computed on a tax-equivalent basis. |
|
(3) |
Net interest spread is calculated by subtracting average rate on interest-bearing liabilities from average yield on interest-earning assets. |
|
(4) |
Net interest margin is calculated by dividing annualized net interest income by average interest-earning assets. |
|
(5) |
Total funding is the sum of interest-bearing liabilities and noninterest-bearing deposits. The cost of total funding is calculated as annualized total interest expense divided by average total funding. |
|
(6) |
Annualized. |
PCB Bancorp and Subsidiary Average Balance, Average Yield, and Average Rate (Unaudited) ($ in thousands) |
||||||||||||||||||||
Six Months Ended |
||||||||||||||||||||
6/30/2022 |
6/30/2021 |
|||||||||||||||||||
Average Balance |
Interest Income/ Expense |
Avg. Yield/Rate(6) |
Average Balance |
Interest Income/ Expense |
Avg. Yield/Rate(6) |
|||||||||||||||
Assets |
||||||||||||||||||||
Interest-earning assets |
||||||||||||||||||||
Total loans (1) |
$ |
1,788,958 |
$ |
41,433 |
4.67 |
% |
$ |
1,666,808 |
$ |
38,255 |
4.63 |
% |
||||||||
Mortgage-backed securities |
86,138 |
723 |
1.69 |
% |
87,140 |
448 |
1.04 |
% |
||||||||||||
Collateralized mortgage obligation |
22,106 |
173 |
1.58 |
% |
23,903 |
111 |
0.94 |
% |
||||||||||||
SBA loan pool securities |
10,633 |
81 |
1.54 |
% |
11,248 |
103 |
1.85 |
% |
||||||||||||
Municipal bonds (2) |
5,489 |
73 |
2.68 |
% |
5,782 |
73 |
2.55 |
% |
||||||||||||
Corporate bonds |
4,944 |
94 |
3.83 |
% |
— |
— |
— |
% |
||||||||||||
Other interest-earning assets |
197,267 |
763 |
0.78 |
% |
176,864 |
319 |
0.36 |
% |
||||||||||||
Total interest-earning assets |
2,115,535 |
43,340 |
4.13 |
% |
1,971,745 |
39,309 |
4.02 |
% |
||||||||||||
Noninterest-earning assets |
||||||||||||||||||||
Cash and due from banks |
20,594 |
19,076 |
||||||||||||||||||
Allowance for loan losses |
(21,787 |
) |
(26,211 |
) |
||||||||||||||||
Other assets |
70,384 |
38,481 |
||||||||||||||||||
Total noninterest-earning assets |
69,191 |
31,346 |
||||||||||||||||||
Total assets |
$ |
2,184,726 |
$ |
2,003,091 |
||||||||||||||||
Liabilities and Shareholders’ Equity |
||||||||||||||||||||
Interest-bearing liabilities |
||||||||||||||||||||
Deposits |
||||||||||||||||||||
NOW and money market accounts |
$ |
448,496 |
743 |
0.33 |
% |
$ |
403,948 |
650 |
0.32 |
% |
||||||||||
Savings |
15,315 |
4 |
0.05 |
% |
11,101 |
2 |
0.04 |
% |
||||||||||||
Time deposits |
553,818 |
1,144 |
0.42 |
% |
625,267 |
1,659 |
0.54 |
% |
||||||||||||
Total interest-bearing deposits |
1,017,629 |
1,891 |
0.37 |
% |
1,040,316 |
2,311 |
0.45 |
% |
||||||||||||
Other borrowings |
10,768 |
105 |
1.97 |
% |
47,128 |
183 |
0.78 |
% |
||||||||||||
Total interest-bearing liabilities |
1,028,397 |
1,996 |
0.39 |
% |
1,087,444 |
2,494 |
0.46 |
% |
||||||||||||
Noninterest-bearing liabilities |
||||||||||||||||||||
Noninterest-bearing demand |
865,294 |
663,902 |
||||||||||||||||||
Other liabilities |
15,194 |
13,618 |
||||||||||||||||||
Total noninterest-bearing liabilities |
880,488 |
677,520 |
||||||||||||||||||
Total liabilities |
1,908,885 |
1,764,964 |
||||||||||||||||||
Total shareholders’ equity |
275,841 |
238,127 |
||||||||||||||||||
Total liabilities and shareholders’ equity |
$ |
2,184,726 |
$ |
2,003,091 |
||||||||||||||||
Net interest income |
$ |
41,344 |
$ |
36,815 |
||||||||||||||||
Net interest spread (3) |
3.74 |
% |
3.56 |
% |
||||||||||||||||
Net interest margin (4) |
3.94 |
% |
3.77 |
% |
||||||||||||||||
Total deposits |
$ |
1,882,923 |
$ |
1,891 |
0.20 |
% |
$ |
1,704,218 |
$ |
2,311 |
0.27 |
% |
||||||||
Total funding (5) |
$ |
1,893,691 |
$ |
1,996 |
0.21 |
% |
$ |
1,751,346 |
$ |
2,494 |
0.29 |
% |
||||||||
(1) |
Total loans include both loans held-for-sale and loans held-for-investment, net of deferred loan fees and costs. |
|
(2) |
The yield on municipal bonds has not been computed on a tax-equivalent basis. |
|
(3) |
Net interest spread is calculated by subtracting average rate on interest-bearing liabilities from average yield on interest-earning assets. |
|
(4) |
Net interest margin is calculated by dividing annualized net interest income by average interest-earning assets. |
|
(5) |
Total funding is the sum of interest-bearing liabilities and noninterest-bearing deposits. The cost of total funding is calculated as annualized total interest expense divided by average total funding. |
|
(6) |
Annualized. |
PCB Bancorp and Subsidiary Non-GAAP Measures ($ in thousands)
Adjusted allowance for loan losses to loans held-for-investment ratio
Adjusted Allowance to loans held-for-investment ratio is calculated by removing SBA PPP loans from loans held-for-investment from the Allowance to loans held-for-investment ratio calculation. The SBA launched the PPP to provide a direct incentive for small businesses to keep their workers on the payroll in response to the COVID-19 pandemic. The SBA guarantees 100% of the PPP loans made to eligible borrowers, and the loans are eligible to be forgiven if certain conditions are met, at which point the SBA will make payments to the Bank for the forgiven amounts. The SBA guarantee on PPP loans cannot be separated from the loan and therefore is not a separate unit of account. The Company considered the SBA guarantee in the Allowance evaluation and determined that it is not required to reserve an Allowance on SBA PPP loans. Management believes this non-GAAP measure enhances comparability to prior periods and provide supplemental information regarding the Company’s credit trends. This disclosure should not be viewed as a substitute for results determined in accordance with GAAP, nor is it necessarily comparable to non-GAAP performance measures that may be presented by other companies. The following tables provide reconciliations of the non-GAAP measure with financial measure defined by GAAP.
($ in thousands) |
6/30/2022 |
3/31/2022 |
12/31/2021 |
6/30/2021 |
|||||||||||||
Loans held-for-investment |
(a) |
$ |
1,833,010 |
$ |
1,742,955 |
$ |
1,732,205 |
$ |
1,719,656 |
||||||||
Less: SBA PPP loans |
(b) |
1,583 |
22,926 |
65,329 |
181,019 |
||||||||||||
Loans held-for-investment, excluding SBA PPP loans |
(c)=(a)-(b) |
$ |
1,831,427 |
$ |
1,720,029 |
$ |
1,666,876 |
$ |
1,538,637 |
||||||||
Allowance |
(d) |
$ |
21,071 |
$ |
21,198 |
$ |
22,381 |
$ |
24,889 |
||||||||
Allowance to loans held-for-investment ratio |
(d)/(a) |
1.15 |
% |
1.22 |
% |
1.29 |
% |
1.45 |
% |
||||||||
Adjusted Allowance to loans held-for-investment ratio |
(d)/(c) |
1.15 |
% |
1.23 |
% |
1.34 |
% |
1.62 |
% |
||||||||
Return on average tangible common equity, tangible common equity per common share and tangible common equity to total assets ratios
The Company's TCE is calculated by subtracting preferred stock from stockholders’ equity. The Company does not have any intangible assets for the presented periods. Return on average TCE, TCE per common share, and TCE to total assets constitute supplemental financial information determined by methods other than in accordance with GAAP. These non-GAAP measures are used by management in its analysis of the Company's performance. This disclosure should not be viewed as a substitute for results determined in accordance with GAAP, nor is it necessarily comparable to non-GAAP performance measures that may be presented by other companies. The following tables provide reconciliations of the non-GAAP measures with financial measures defined by GAAP.
($ in thousands) |
Three Months Ended |
Six Months Ended |
|||||||||||||||||||
6/30/2022 |
3/31/2022 |
6/30/2021 |
6/30/2022 |
6/30/2021 |
|||||||||||||||||
Average total shareholders' equity |
(a) |
$ |
292,135 |
$ |
259,367 |
$ |
239,448 |
$ |
275,841 |
$ |
238,127 |
||||||||||
Less: average preferred stock |
(b) |
28,872 |
— |
— |
14,516 |
— |
|||||||||||||||
Average TCE |
(c)=(a)-(b) |
$ |
263,263 |
$ |
259,367 |
$ |
239,448 |
$ |
261,325 |
$ |
238,127 |
||||||||||
Net income |
(d) |
$ |
9,092 |
$ |
10,240 |
$ |
9,844 |
$ |
19,332 |
$ |
18,404 |
||||||||||
Return on average shareholder's equity (1) |
(d)/(a) |
12.48 |
% |
16.01 |
% |
16.49 |
% |
14.13 |
% |
15.59 |
% |
||||||||||
Return on average TCE (1) |
(d)/(c) |
13.85 |
% |
16.01 |
% |
16.49 |
% |
14.92 |
% |
15.59 |
% |
||||||||||
(1) Annualized. |
|||||||||||||||||||||
($ in thousands, except per share data) |
6/30/2022 |
3/31/2022 |
12/31/2021 |
6/30/2021 |
|||||||||||||
Total shareholders' equity |
(a) |
$ |
334,375 |
$ |
261,058 |
$ |
256,286 |
$ |
238,941 |
||||||||
Less: preferred stock |
(b) |
69,141 |
— |
— |
— |
||||||||||||
TCE |
(c)=(a)-(b) |
$ |
265,234 |
$ |
261,058 |
$ |
256,286 |
$ |
238,941 |
||||||||
Outstanding common shares |
(d) |
14,956,760 |
14,944,663 |
14,865,825 |
14,854,315 |
||||||||||||
Book value per common share |
(a)/(d) |
$ |
22.36 |
$ |
17.47 |
$ |
17.24 |
$ |
16.09 |
||||||||
TCE per common share |
(c)/(d) |
$ |
17.73 |
$ |
17.47 |
$ |
17.24 |
$ |
16.09 |
||||||||
Total assets |
(e) |
$ |
2,344,560 |
$ |
2,199,742 |
$ |
2,149,735 |
$ |
2,060,003 |
||||||||
Total shareholders' equity to total assets |
(a)/(e) |
14.26 |
% |
11.87 |
% |
11.92 |
% |
11.60 |
% |
||||||||
TCE to total assets |
(c)/(e) |
11.31 |
% |
11.87 |
% |
11.92 |
% |
11.60 |
% |
||||||||
View source version on businesswire.com: https://www.businesswire.com/news/home/20220728005118/en/
Timothy Chang Executive Vice President & Chief Financial Officer 213-210-2000
Source: PCB Bancorp