SOURCE: Columbia Commercial Bancorp

Columbia Commercial Bancorp

August 25, 2011 16:01 ET

Columbia Commercial Bancorp Reports Second Quarter 2011 Results

HILLSBORO, OR--(Marketwire - Aug 25, 2011) - Columbia Commercial Bancorp (OTCBB: CLBC), a single bank holding company for Columbia Community Bank (the Bank), reports a net loss of $430,000, or ($0.14) per diluted share for the second quarter of 2011 compared to a net income of $333,000, or $0.10 per diluted share for the first quarter of 2011. For the six months ended June 30, 2011, the net loss was $97,000, or ($0.04) per diluted share compared to a net loss of $928,000 or ($0.30) per diluted share for the same six month period in 2010.

"The loss this quarter and year-to-date is the direct result of a $1.1 million loan loss provision for the second quarter," states the Company's President and Chief Executive Officer, Rick A. Roby. And Mr. Roby continues, "The increase to the allowance is not the result of increased charge-offs over this past quarter, but is more in response to a very thorough review of the Bank's loan portfolio and recognizing some increased risk exposure within a few select credit relationships. At this point in time, we do not ultimately foresee taking any losses on these relationships, but as their risk exposure has increased, our analysis on the allowance for loan losses shows it prudent to increase our reserves as well. Moving forward we will continue to closely monitor these and all other relationships within the Bank's loan portfolio to ensure our allowance for loan losses continues to be well funded." The Bank's allowance for loan losses is 3.05% of loans as of June 30, 2011 compared to 2.79% as of March 31, 2011 and 3.07% as of December 31, 2010.

Assets

Total assets at $361.0 million as of June 30, 2011 are up slightly, 0.7%, from the $358.5 million as of December 31, 2010. The Bank's liquidity remains very strong with $28.6 million in cash and over $5.0 million in fed funds sold as of June 30, 2011. Compared to a year ago, when total assets were $379.1 million as of June 30, 2010, assets are down $18.1 million which is primarily from the Bank working to reduce the low-yielding excess liquidity it had at that time.

Total loans at $246.2 million as of June 30, 2011 have remained relatively constant when compared to the $246.7 million as of June 30, 2010 and are up from the $244.9 million as of December 31, 2010 and the $241.5 million as of March 31, 2011. "Our loan officers have been actively seeking qualified new loan requests and those efforts are paying off. The Bank has seen an increase in quality loan requests over the past few quarters which have resulted in both increased loans outstanding and commitments," states Fred Johnson, the Company's Chief Credit Officer. And Mr. Johnson continues, "And while there is some seasonality, we continue to see an overall shift in the mix of our loan portfolio away from construction and land development loans into additional commercial real estate loans and commercial and industrial loans." As of June 30, 2011, construction and land development loans totaled $47.6 million or 19.3% of loans, down $5.0 million from June 30, 2010 when they were $52.6 million and 21.3% of loans. Commercial real estate loans are now $80.8 million, or 32.8% of total loans compared to $79.9 million, or 32.4% of total loans as of June 30, 2010. Commercial and industrial loans are now $77.7 million, or 31.5% of total loans compared to $74.1 million or 30.0% of loans as of June 30, 2010.

The allowance for loan losses was $7.5 million, or 3.05% of loans as of June 30, 2011 compared to $6.7 million or 2.79% of loans as of March 31, 2011, $7.5 million or 3.07% of loans as of December 31, 2010 and $7.9 million or 3.19% of loans as of June 30, 2010. Net loan charge-offs for second quarter 2011 were $337,000 compared to $1.0 million in the first quarter of this year. Loans past due 30-89 days as of June 30, 2011 were a mere $100,000, or 0.04% of outstanding loans and the Bank has 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 $21.1 million as of June 30, 2011 relative to $22.1 million at the end of 2010 and $22.7 million a year ago. At the end of the quarter, OREO was 57.6% of all non-performing assets compared to 47.6% this time last year. For the first six months of 2011, the Bank sold nine OREO properties totaling $1.2 million at a net gain of $56,000. Subsequent to June 30th the Bank has sold three additional properties totaling another $1.2 million for a net gain of $9,000.

Deposits

At $251.8 million as of June 30, 2011, deposits are down $15.5 million or 5.8% when compared to this time last year when they were $267.3 million and are also down $1.0 million, or 0.4%, compared to the $252.8 million as of December 31, 2010. However, in the first six months of 2011 the Bank has reduced its brokered and nontraditional out-of-area deposits by $9.8 million and compared to June 2010, such deposits are down by over $32.3 million. The Bank's chief financial officer, Bob Ekblad, notes "Excluding for the changes in brokered and nontraditional out-of-area deposits, core local deposits are up $8.8 million for 2011 and are up $16.8 million compared to this time last year. Over the past few years we have been very focused on growing local deposits so the Bank can reduce its reliance on non-traditional funding sources, and we are very pleased with our results." As of June 30, 2011, the Bank had $20.1 million in brokered deposits of which $5.2 million mature during the remainder of 2011; this is down from the $39.6 million in brokered deposits as of June 30, 2010.

Earnings

The Company's second quarter 2011 loss of $430,000 was a direct result of the $1.1 million loan loss provision for the period. With a $250,000 loan loss provision in the first quarter of this year, the Company's year-to-date loan loss provision of $1.4 million was below the $1.8 million taken for the first six months of 2010. Year-to-date 2011, the Company is reporting a net loss of $97,000 compared to a net loss of $928,000 for the same six month period in 2010. The 2011 improved results are not only the result of the lowered loan loss provision, but are also the result of improved net interest income by $508,000 year-to-date and also a $603,000 pre-tax security gain taken in the first quarter of 2011.

"Net interest income continues to grow quarter by quarter as non-performing assets are reduced and the Bank replaces its higher cost maturing brokered and other wholesale funds with lower costing local deposits," states Mr. Roby. Net interest margin at 3.16% for second quarter 2011 continued its upward trend from the 3.00% for first quarter 2011 and at 3.05% for the first six months of 2011; it is up 40 basis points from the 2.65% for the same period in 2010.

Non-interest income at $184,000 for second quarter is up from the $151,000 for first quarter 2011 and year-to-date for 2011 at $335,000 is above the $241,000 reported for the same period of 2010. The increase in non-interest income over these periods is primarily from an increase in rental income on other real estate owned (or "OREO). Non-interest expense was $2.2 million for both the second and first quarters of 2011 and at $4.4 million for the first six months of 2011, it is $71,000 above the 2010 levels which is due to increases in foreclosure, OREO, and other legal expenditures. Direct expenses relating to the foreclosure, OREO, and other legal expenditures remain elevated as the Bank works through its non-performing assets; such expenses were $266,000 for this past quarter, $191,000 for first quarter 2011 and at $457,000 year-to-date 2011, they are $105,000 over the amount for the same six month period of 2010 when they totaled $352,000.

Capital

With the Bank's loss for the quarter and an increase to disallowed deferred tax assets for regulatory calculations, the Bank's leverage ratio has declined from 7.53% as of December 31, 2010 to 7.37% as of June 30, 2011. And with the increase in loans and other assets, the Bank's risk-weighted assets have increased throughout 2011 causing its tier 1 risk-based capital ratio and its total risk-based capital ratio to also decline to 9.25% and 10.52% compared to 9.92% and 11.19% as of December 31, 2010, respectively. The Bank's capital ratios continue to exceed those required to be considered "well-capitalized" according to the standard regulatory guidelines.

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)
June 30, % Change % Change
2011 2010 2011 vs. 2010 December 31, 2010 Year-to-Date
ASSETS
Cash & due from banks $ 28,574 $ 31,178 -8.4 % $ 18,743 52.5 %
Federal funds sold 5,020 10,000 -49.8 % 9,995 -49.8 %
Investment Securities - Available for Sale 57,262 67,519 -15.2 % 62,261 -8.0 %
Investments - Other 2,307 2,481 -7.0 % 2,401 -3.9 %
Gross loans 246,206 246,703 -0.2 % 244,868 0.5 %
Allowance for loan losses (7,497 ) (7,859 ) -4.6 % (7,525 ) -0.4 %
Net loans 238,709 238,844 -0.1 % 237,343 0.6 %
Other real estate owned 12,152 10,781 12.7 % 11,051 10.0 %
Other assets 16,991 18,288 -7.1 % 16,704 1.7 %
Total Assets $ 361,015 $ 379,091 -4.8 % $ 358,498 0.7 %
LIABILITIES
Deposits $ 251,828 $ 267,300 -5.8 % $ 252,816 -0.4 %
Repurchase agreements 23,231 24,796 -6.3 % 19,893 16.8 %
Federal funds purchased - 0.0 % - 0.0 %
FHLB borrowings 52,635 52,635 0.0 % 52,635 0.0 %
Other borrowings 4,456 4,448 0.2 % 4,453 0.1 %
Junior subordinated debentures 8,248 8,248 0.0 % 8,248 0.0 %
Other liabilities 3,102 3,238 -4.2 % 3,110 -0.3 %
Total Liabilities 343,500 360,665 -4.8 % 341,155 0.7 %
STOCKHOLDERS' EQUITY 17,515 18,426 -4.9 % 17,343 1.0 %
Total Liabilities and Stockholders' Equity $ 361,015 $ 379,091 -4.8 % $ 358,498 0.7 %
Shares outstanding at end-of-period 3,151,581 3,145,081 3,145,081
Book value per share $ 5.56 $ 5.86 $ 5.51
Allowance for loan losses to total loans 3.05 % 3.19 % 3.07 %
Non-performing assets (non-accrual loans & OREO) $ 21,084 $ 22,659 $ 22,134
Bank Tier 1 leverage ratio (5% minimum for "well-capitalized") 7.37 % 7.33 % 7.53 %
Bank Tier 1 risk-based capital ratio (6% minimum for "well-capitalized") 9.25 % 9.87 % 9.92 %
Bank Total risk-based capital ratio (10% minimum for "well-capitalized") 10.52 % 11.14 % 11.19 %
Consolidated Statement of Operations
Unaudited
(amounts in 000's, except per share data and ratios)
Three Months Ending Six Months Ending
6/30/2011 3/31/2011 % Change 6/30/2011 6/30/2010 % Change
INTEREST INCOME
Loans $ 3,716 $ 3,676 1.1 % $ 7,392 $ 7,770 -4.9 %
Investments 295 358 -17.6 % 653 782 -16.5 %
Federal funds sold and other 17 12 41.7 % 29 55 -47.3 %
Total interest income 4,028 4,046 -0.4 % 8,074 8,607 -6.2 %
INTEREST EXPENSE
Deposits 865 984 -12.1 % 1,849 2,925 -36.8 %
Repurchase agreements and federal funds purchased 85 83 2.4 % 168 165 1.8 %
FHLB borrowings 530 524 1.1 % 1,054 1,054 0.0 %
Other borrowings 121 121 0.0 % 242 215 12.6 %
Junior subordinated debentures 60 58 3.4 % 118 113 4.4 %
Total interest expense 1,661 1,770 -6.2 % 3,431 4,472 -23.3 %
NET INTEREST INCOME BEFORE PROVISION FOR LOAN LOSSES 2,367 2,276 4.0 % 4,643 4,135 12.3 %
PROVISION FOR LOAN LOSSES 1,100 250 340.0 % 1,350 1,750 -22.9 %
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 1,267 2,026 -37.5 % 3,293 2,385 38.1 %
NON-INTEREST INCOME 184 151 21.9 % 335 241 39.0 %
NON-INTEREST EXPENSE 2,193 2,196 -0.1 % 4,389 4,318 1.6 %
INVESTMENTS- REALIZED GAINS / (LOSSES) - 603 -100.0 % 603 173 248.6 %
INVESTMENTS - OTHER THAN TEMPORARY IMPAIRMENT - - 0.0 % - - 0.0 %
OREO VALUATION ADJUSTMENTS & GAINS/(LOSSES) ON SALES - NET (1 ) (86 ) -98.8 % (87 ) (97 ) -10.3 %
INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES (743 ) 498 -249.2 % (245 ) (1,616 ) -84.8 %
PROVISION (BENEFIT) FOR INCOME TAXES (313 ) 165 -289.7 % (148 ) (688 ) -78.5 %
NET INCOME (LOSS) $ (430 ) $ 333 -229.1 % $ (97 ) $ (928 ) -89.5 %
Earnings (Loss) per share - Basic $ (0.14 ) $ 0.11 $ (0.03 ) $ (0.30 )
Earnings (Loss) per share - Diluted $ (0.14 ) $ 0.10 $ (0.04 ) $ (0.30 )
Return on average equity -9.84 % 7.67 % -1.11 % -10.14 %
Return on average assets -0.48 % 0.38 % -0.05 % -0.49 %
Net interest margin 3.16 % 3.00 % 3.05 % 2.65 %
Efficiency ratio 86.0 % 90.5 % 88.2 % 98.7 %

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