SOURCE: Columbia Commercial Bancorp

Columbia Commercial Bancorp

April 27, 2011 16:55 ET

Columbia Commercial Bancorp Reports First Quarter 2011 Results

HILLSBORO, OR--(Marketwire - Apr 27, 2011) - Columbia Commercial Bancorp (OTCBB: CLBC), a single bank holding company for Columbia Community Bank (the Bank), reports net income of $333,000, or $0.10 per diluted share for the three months ended March 31, 2011 compared to net losses of $415,000 or ($0.13) per diluted share for the fourth quarter of 2010 and $331,000 or ($0.11) per diluted share for the first quarter of 2010.

"Contributing to the Bank's profitability for the quarter was a $603,000 pre-tax gain on the sale of marketable securities and a decline in its provision expense for loan losses which was $250,000 for the quarter compared to $750,000 for each of the fourth and first quarters of 2010," states the Company's President and Chief Executive Officer, Rick A. Roby. He continues, "Also contributing to the improved earnings for the quarter was the increase in the Bank's net interest margin as non-performing assets continued their downward trend to $20.1 million at the end of the quarter and as higher priced liabilities matured during the quarter and were either paid-off with excess cash or replaced with local lower costing deposits."

Assets

Total assets at $365.1 million as of March 31, 2011 were up $6.6 million over the prior quarter primarily from a $7.6 million increase in repurchase agreements on the liability side of the balance sheet. The Bank was very liquid at the end of the quarter where cash was $44.3 million, federal funds sold were $15.0 million and available-for-sale securities exceeded $39.2 million. Bob Ekblad, the Company's Chief Financial Officer, comments, "Cash and federal funds sold at the end of the quarter were higher than we observed over the prior few quarters and excessive relative to the Bank's needs. These excessive levels were from both an increase in repurchase agreements at the end of the quarter and from the $29.0 million in securities sold for gains in mid-March which the Bank had yet to fully redeploy by the end of the quarter. Moving forward, the Bank will reinvest these funds into shorter-term and less price-volatile securities, fund anticipated loan growth, and continue paying down higher-cost liabilities as they mature."

Total loans at $241.5 million as of March 31, 2011 decreased $3.4 million, or 1.4%, over the quarter and $12.3 million, or 4.9%, from this time last year. "The reduction in loans over the quarter was actually the result of loan charge-offs and non-performing loans moving to the Bank's OREO while the rest of the Bank's loan portfolio was relatively flat," states the Company's Chief Credit Officer, Fred Johnson; and he continues, "the decline in loans over the past year relates to the planned reduction in construction and land development loans while other loan categories remained relatively flat due to reduced demand from both existing clients and prospects." As of March 31, 2011, construction and land development loans totaled $46.5 million or 19.3% of gross loans, down $2.5 million for the quarter and down $9.8 million from this time last year. Commercial real estate loans as well as commercial and industrial loans have been relatively stable over the past year and each are at $77.8 million, or 32.2% of the Bank's gross loans as of March 31, 2011. The allowance for loan losses was $6.7 million or 2.79% of loans as of March 31, 2011 compared to $7.5 million, or 3.07% of outstanding loans as of December 31, 2010 and $8.1 million, or 3.19%, as of March 31, 2010. Net loan charge-offs for the quarter were $1.0 million relative to the loan loss provision of $250,000. Loans past due 30-89 days as of March 31, 2011 were $1.4 million, or 0.59% of outstanding loans. Also, at the end of the quarter, the Bank had no loans over 90 days past due and still accruing interest

Non-performing assets consist of loans on non-accrual status and other real estate owned (OREO) which in aggregate were $20.1 million as of March 31, 2011 relative to $22.1 million at the end of 2010 and $26.5 million a year ago. At the end of the quarter, OREO was 63.6% of all non-performing assets compared to 41.7% this time last year as the Bank gets closer to eventual resolution on these troubled assets.

Deposits

A continued reduction in brokered deposits and other nontraditional out-of-area deposits has resulted in decreased overall deposits over the past twelve months. Current deposits at $249.4 million as of March 31, 2011 are down $30.2 million, or 10.8%, when compared to the $279.6 million as of March 31, 2010; however, over this same time period the Bank reduced its brokered and nontraditional out-of-area deposits by $45.1 million, meaning that local deposits actually increased $14.9 million over the past twelve months. "The Bank has put forth a variety of strategic trusts and other changes to boost local deposits and Management and the Board are very pleased with the results. These local deposits are stable funding sources and create franchise value. And the Bank has no intention of slowing down these efforts," states Mr. Roby.

As of March 31, 2011, the Bank had $25.2 million in brokered deposits, down from $51.9 million as of March 31, 2010. The Bank retired $2.5 million in brokered deposits during the first quarter of 2011, and for the rest of 2011 has another $10.3 million in brokered deposits maturing which it will retire from anticipated growth in other deposits and cash reserves.

Earnings

Pre-tax security gains of $603,000 for the quarter contributed significantly to the Company's $333,000 net profit for first quarter 2011. Provision for loan loss expense for first quarter 2011 was $250,000 compared to $750,000 for fourth quarter 2010 where the Company reported a $415,000 net loss with no security gains. Net interest income over the past two quarters has been relatively stable at about $2.3 million but is up about $300,000 when compared to the first quarter of 2010 where deposit costs for the quarter were over $570,000 higher than this most recent quarter. "Deposit costs are down due to decreases in volume, rate, and an improved mix," states Mr. Ekblad. "We will continue to see improvement moving forward as higher-cost nontraditional deposits mature and are paid-off from excess cash or cheaper local deposits. Earning asset yields should also improve as the amount of non-performing assets continues to decrease and the Bank deploys its excess cash into higher yielding securities and loans."

Net interest margin at 3.00% for first quarter 2011 is up only slightly from the 2.95% for fourth quarter 2010 but is up considerably from the 2.54% for first quarter 2010. "While slower than desired, the Company is making progress at improving its net interest margin and continued improvement is crucial for future earnings growth," states Mr. Roby. He continues by noting, "Over the past few years the Bank has prudently been very liquid to keep flexible with all the challenges facing banks in today's environment and loan demand has been softer than anticipated due to the general economic weaknesses facing our markets. But as we move forward we see more stability in our funding sources which means less need for such excess liquidity and we also foresee increased loan demand giving the Bank a place to deploy this excess liquidity at much improved yields relative to over-night funds and short-term investments."

Non-interest income at $151,000 and non-interest expense at $2.2 million for first quarter 2011 are relatively consistent with fourth quarter and first quarter 2010 amounts. Direct expenses relating to the foreclosure, collection, and liquidation of current and prior non-performing assets was $191,000 for first quarter 2011 and $221,000 for fourth quarter 2010 compared to $132,000 for first quarter 2010.

Capital

The Bank's retained profits for the quarter elevated its leverage ratio to 7.61% as of March 31, 2011 compared to 7.53% as of December 31, 2010; however this increase to capital was not sufficient to offset the growth in risk-weighted assets over the quarter such that both the Bank's tier 1 risk-based capital ratio and its total risk-based capital ratios declined over the quarter to 9.67% and 10.94%, respectively, compared to 9.92% and 11.19% as of December 31, 2010. The Bank's capital levels and ratios exceeds those required to be considered "well-capitalized" according to the standard regulatory guidelines, however the Company continues to explore and consider additional capital raising alternatives as it would like to increase capital levels for future loan growth and other opportunities.


About Columbia Commercial Bancorp: Information about the Company's stock may be obtained through the Over the Counter Bulletin Board at www.otcbb.com. Columbia Commercial Bancorp's stock symbol is CLBC.

Columbia Commercial Bancorp was formed in 2002 as a holding company for Columbia Community Bank, which was opened in 1999 by local business people to deliver loan and deposit product solutions through experienced and professional bankers to businesses, nonprofits, professionals, and individuals throughout Washington County and the greater Portland metropolitan area. The Bank was named among the "100 Best Companies to Work for in Oregon" by Oregon Business Magazine (2009 and 2007) and the Bank has also been named by Portland Business Journal as one of the "100 Fastest-Growing Private Companies in Oregon" consistently over the past several years.

For more information about Columbia Commercial Bancorp, or its subsidiary, Columbia Community Bank, call (503) 693-7500 or visit our website at www.columbiacommunitybank.com. Information contained in or linked to our website is not incorporated as a part of this release.

Certain statements in this release may constitute forward-looking statements within the definition of the "safe-harbor" provisions of Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are subject to significant uncertainties, which could cause actual results to differ materially from those set forth in such statements. Forward-looking statements are those that incorporate management's current expectations and plans based on information currently know to them. These statements can sometimes be identified by words such as "believe," "estimate," "anticipate," "expect," "intend," "will," "may," "should," or other similar phrases or words. Readers are cautioned not to place undue reliance on forward-looking statements. In particular, they should not be construed as assurances of a given level of performance or as promises of a given set of management's actions. Some of the factors that could cause management to deviate from its current plans, or could cause the Company's results to differ from current expectations, include the effect of localized or regional economic shifts that may affect the collectability of loans or the value of the collateral underlying those loans; the effects of laws, regulations, policies and government actions upon the Company's assets and operations; sensitivity to the Northwestern Oregon geographic markets and events affecting those market; and the impacts of new government initiatives upon us and our borrowers. The Company does not intend to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this release or to reflect the occurrence of unanticipated events.

                           Columbia Commercial Bancorp
                           Consolidated Balance Sheet
                                   Unaudited
                      (amounts in 000's, except per share
                               data and ratios)



                                         % Change
                       March 31,         2011 vs.  December 31,  % Change
                   2011        2010        2010        2010       Quarter
                ----------  ----------  ----------  ----------  ----------

ASSETS
   Cash & due
    from banks  $   44,313  $   42,297         4.8% $   18,743       136.4%
   Federal
    funds sold      15,000      10,025        49.6%      9,995        50.1%
   Investment
    Securities
    - Available
    for Sale        39,208      62,109       -36.9%     62,261       -37.0%
   Investments
    - Other          2,307       2,481        -7.0%      2,401        -3.9%

   Gross loans     241,504     253,834        -4.9%    244,868        -1.4%
   Allowance
    for loan
    losses          (6,734)     (8,099)      -16.9%     (7,525)      -10.5%
                ----------  ----------  ----------  ----------  ----------
      Net loans    234,770     245,735        -4.5%    237,343        -1.1%

   Other real
    estate
    owned           12,796      11,044        15.9%     11,051        15.8%
   Other assets     16,706      17,791        -6.1%     16,704         0.0%
                ----------  ----------  ----------  ----------  ----------

      Total
       Assets   $  365,100  $  391,482        -6.7% $  358,498         1.8%
                ==========  ==========  ==========  ==========  ==========

LIABILITIES
   Deposits     $  249,397  $  279,565       -10.8% $  252,816        -1.4%
   Repurchase
    agreements      27,504      22,243        23.7%     19,893        38.3%
   Federal
    funds
    purchased            -           -         0.0%          -         0.0%
   FHLB
    borrowings      52,635      52,635         0.0%     52,635         0.0%
   Other
    borrowings       4,455       4,445         0.2%      4,453         0.0%
   Junior
    subordinated
    debentures       8,248       8,248         0.0%      8,248         0.0%
   Other
    liabilities      5,316       5,896        -9.8%      3,110        70.9%
                ----------  ----------  ----------  ----------  ----------
      Total
       Liabil-
       ities       347,555     373,032        -6.8%    341,155         1.9%

STOCKHOLDERS'
 EQUITY             17,545      18,450        -4.9%     17,343         1.2%
                ----------  ----------  ----------  ----------  ----------

      Total
       Liabil-
       ities and
       Stock-
       holders'
       Equity   $  365,100  $  391,482        -6.7% $  358,498         1.8%
                ==========  ==========  ==========  ==========  ==========

Shares
 outstanding at
 end-of-period   3,151,581   3,145,081               3,145,081
Book value per
 share          $     5.57  $     5.87              $     5.51
Allowance for
 loan losses to
 total loans          2.79%       3.19%                   3.07%
Non-performing
 assets
 (non-accrual
 loans & OREO)  $   20,105  $   26,493              $   22,134

Bank Tier 1
 leverage ratio
 (5% minimum
 for "well-
 capitalized")        7.61%       7.39%                   7.53%
Bank Tier 1
 risk-based
 capital ratio
 (6% minimum
 for "well-
 capitalized")        9.67%       9.83%                   9.92%
Bank Total
 risk-based
 capital ratio
 (10% minimum
 for "well-
 capitalized")       10.94%      11.10%                  11.19%



                   Consolidated Statement of Operations
                                Unaudited
           (amounts in 000's, except per share data and ratios)



                                                   Three Months
                  Three Months Ending                 Ending
                ----------------------              ----------
                 3/31/2011   3/31/2010    % Change  12/31/2010    % Change
                ----------  ----------  ----------  ----------  ----------
INTEREST INCOME
   Loans        $    3,676  $    3,900        -5.7% $    3,827        -3.9%
   Investments         358         342         4.7%        438       -18.3%
   Federal
    funds sold
    and other           12          31       -61.3%         14       -14.3%
                ----------  ----------  ----------  ----------  ----------
      Total
       interest
       income        4,046       4,273        -5.3%      4,279        -5.4%
                ----------  ----------  ----------  ----------  ----------

INTEREST
 EXPENSE
   Deposits            984       1,556       -36.8%      1,126       -12.6%
   Repurchase
    agreements
    and federal
    funds
    purchased           83          77         7.8%         80         3.8%
   FHLB
    borrowings         524         524         0.0%        536        -2.2%
   Other
    borrowings         121          92        31.5%        122        -0.8%
   Junior
    subordinated
    debentures          58          55         5.5%         58         0.0%
                ----------  ----------  ----------  ----------  ----------
      Total
       interest
       expense       1,770       2,304       -23.2%      1,922        -7.9%
                ----------  ----------  ----------  ----------  ----------

NET INTEREST
 INCOME BEFORE
 PROVISION FOR
 LOAN LOSSES         2,276       1,969        15.6%      2,357        -3.4%

PROVISION FOR
 LOAN LOSSES           250         750       -66.7%        750       -66.7%
                ----------  ----------  ----------  ----------  ----------

NET INTEREST
 INCOME AFTER
 PROVISION FOR
 LOAN LOSSES         2,026       1,219        66.2%      1,607        26.1%

NON-INTEREST
 INCOME                151         120        25.8%        135        11.9%

NON-INTEREST
 EXPENSE             2,196       2,070         6.1%      2,212        -0.7%

INVESTMENTS -
 REALIZED GAINS
 / (LOSSES)            603         173       248.6%          -         n/a
INVESTMENTS -
 OTHER THAN
 TEMPORARY
 IMPAIRMENT              -           -         0.0%       (225)     -100.0%
OREO VALUATION
 ADJUSTMENTS &
 GAINS/(LOSSES)
 ON SALES - NET        (86)        (33)      160.6%        (38)      126.3%
                ----------  ----------  ----------  ----------  ----------

INCOME (LOSS)
 BEFORE
 PROVISION FOR
 INCOME TAXES          498        (591)     -184.3%       (733)     -167.9%

PROVISION
 (BENEFIT) FOR
 INCOME TAXES          165        (260)     -163.5%       (318)     -151.9%
                ----------  ----------  ----------  ----------  ----------

NET INCOME
 (LOSS)         $      333  $     (331)     -200.6% $     (415)     -180.2%
                ==========  ==========  ==========  ==========  ==========

Earnings (Loss)
 per share -
 Basic          $     0.11  $    (0.11)             $    (0.13)

Earnings (Loss)
 per share -
 Diluted        $     0.10  $    (0.11)             $    (0.13)

Return on
 average equity       7.67%      -7.27%                  -8.85%
Return on
 average assets       0.38%      -0.35%                  -0.45%
Net interest
 margin               3.00%       2.54%                   2.95%
Efficiency
 ratio                90.5%       99.1%                   88.8%

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