SOURCE: Columbia Commercial Bancorp

Columbia Commercial Bancorp

October 24, 2013 16:51 ET

Columbia Commercial Bancorp Reports Third Quarter 2013 Results

HILLSBORO, OR--(Marketwired - Oct 24, 2013) - Columbia Commercial Bancorp (OTCBB: CLBC), a single bank holding company for Columbia Community Bank (the Bank), reports a net profit of $1.1 million, or $0.28 per diluted share, for the nine months ended September 30, 2013, compared to net income of $638,000, or $0.20 per diluted share, for the same nine month period in 2012. Net income for third quarter 2013 of $466,000, or $0.10 per diluted share, was up from the $303,000, or $0.08 per diluted share, in the second quarter of 2013, and up from the $368,000, or $0.10 per diluted share, for the first quarter of 2013. 

"As Columbia Community Bank continues to strengthen both its asset and liability mix, net interest income continues to grow as do our earnings," stated the Company's President and CEO, Rick A. Roby. "And with the successful $6.6 million common stock offering completed this past quarter which significantly bolstered the Bank's capital levels, the foundation has been established for continued growth and success in the years ahead," added Mr. Roby. 

Assets

Total assets at $339.2 million as of September 30, 2013 increased $16.5 million, or 5.1%, from the $322.7 million as of December 31, 2012. This increase was primarily from the increase in cash due to increased deposits at the Bank. When compared to the $346.0 million as of September 30, 2012, total assets were down $6.8 million, or 2.0% which was due to the Bank's successful deleveraging strategy during fourth quarter 2012. 

Total loans were $244.8 million at both September 30, 2013 and December 31, 2012, and were up $1.0 million, or 0.4%, since September 30, 2012. "While total outstanding loans may have not changed so far this year, the staff has been very busy and quite successful at generating non-construction related loans which is evident by the changes in those outstanding loan balances," states the Bank's Chief Credit Officer, Fred Johnson. Real estate acquisition, development, and construction loans were $32.2 million, or 13.2% of total loans, as of September 30, 2013 and were down $9.0 million when compared to the $41.2 million as of December 31, 2012 when these loans were 16.8% of the Bank's total outstanding loans. Commercial and Industrial (C&I) loans outstanding were $75.1 million, or 30.7% of total outstanding loans, as of September 30, 2013, which was consistent with prior year-end amounts. Commercial real estate loans at $110.4 million, or 45.1% of total loans, as of September 30, 2013 were up $14.6 million since December 31, 2012.

The allowance for loan losses as of September 30, 2013 at $6.1 million, or 2.49% of loans, was fairly consistent with the $6.2 million, or 2.51% of loans as of December 31, 2012. These amounts were lower than the $7.0 million, or 2.86% of loans, as of September 2012, as during the fourth quarter of 2012 due to the continued improvement in the loan portfolio's underlying credit metrics, the Bank took a negative loan provision of $750,000, which was a reduction to the outstanding allowance for loan losses. Year-to-date 2013, the Bank had $290,000 in loan charge-offs and $229,000 in loan recoveries, or net losses of $61,000 compared to the same nine month period in 2012 when loan charge-offs were $1.7 million and recoveries were $1.6 million, resulting in net losses of $120,000. 

As of September 30, 2013 the Bank had no loans past due over 30 days and still accruing interest compared to June 30, 2013 when the Bank had $5.3 million in loans that were past due between 30 to 89 days which were still accruing interest and were all related to one adversely classified borrower that has subsequently been moved to non-accrual status as the Bank works toward resolution. 

Other real estate owned (OREO) at $9.0 million as of September 30, 2013 was an increase over recent quarters as the Bank finalized foreclosure on two problem loan relationships totaling $2.4 million. Non-performing assets which consist of both OREO and loans on nonaccrual status totaled $18.9 million as of September 30, 2013. This was an increase over the $14.0 million as of June 30, 2013 and the $17.7 million as of December 31, 2012 resulting from the $5.3 million loan relationship previously mentioned being moved into nonaccrual status. Nonaccrual loans as of September 30, 2013 consisted of eight relationships ranging in size from $17,000 to $5.2 million and totaled $9.9 million. OREO as of September 30, 2013 consisted of nine properties with carrying amounts ranging from $45,000 to $4.6 million. 

As of September 30, 2013 the Bank has over $43.0 million of excess cash and unpledged securities. This provides ample opportunities for loan growth and funds for reducing liabilities such as the $1.9 million brokered deposit maturing in the early part of fourth quarter 2013.

Deposits

"We continue to see the benefit of the Bank's increased initiatives around deposit acquisition put in place a few years ago. This core deposit growth allows us to substantially reduce our reliance on other more expensive funding sources," states Bob Ekblad, the Company's Chief Financial Officer. Total deposits were $236.2 million as of September 30, 2013 which was an increase of $8.2 million, or 3.6%, when compared to the $228.0 million as of December 31, 2012. And while total deposits as of September 30, 2013 were down $1.7 million, or 0.7%, when compared to the September 30, 2012 amount of $237.9 million, Mr. Ekblad adds, "It is important to understand the significant reduction in brokered and other non-traditional out-of-area time deposits which totaled $11.3 million over the past nine months and $21.5 million over the past twelve months." Adjusting for the reductions in brokered and other non-traditional out-of-area time deposits, the Bank's core deposits have grown $19.7 million over this past year. As of September 30, 2013, brokered deposits of $2.3 million were down $7.1 million when compared to the $9.4 million outstanding as of September 30, 2012. As of September 30, 2013, other non-traditional out-of-area time deposits were $41.3 million, or down $14.4 million when compared to the $55.7 million outstanding as of September 30, 2012. 

Earnings

Net interest income continues to grow each quarter and year-over-year. At $7.8 million for the nine months ended September 30, 2013, net interest income was $605,000, or 8.4% higher than the $7.2 million for the same period last year. Net interest margin at 3.48% for the third quarter of 2013 was nine basis points higher than the prior quarter and at 3.42% for the nine months ended September 30, 2013, it was sixteen basis points higher than the 3.26% for the same period in 2012. "While total loans have remained relatively flat and their yields are continually under pressure from scheduled repricings and market competition, the Company has been able to increase its net interest income by focusing heavily on the liability side of the balance sheet through paying off or converting debt, reducing expensive brokered and other non-traditional deposits, favorable repricings, and improving the rest of our overall deposit mix to lower costing funds," adds Mr. Ekblad.

Noninterest income for the first nine months of 2013 at $464,000 was down from the $490,000 for the same period in 2012 due to reduced rental receipts on OREO properties that the Bank no longer holds; however, this reduction was somewhat offset by increased service charges and other income as evidenced by the slight increase in noninterest income to $164,000 for 3rd quarter 2013 compared to $156,000 for the prior quarter. Noninterest expense for the nine months ended September 30, 2013 at $6.8 million was $305,000, or 4.7% higher than in the same period in 2012. Problem loan and OREO expenses continue to be high as the Bank works these non-performing assets to final resolution; these costs were $315,000 for the first nine months of 2013 compared to $189,000 for the same period of 2012. And Mr. Roby adds, "The other attributes increasing noninterest expense for the period relate to a number of the Bank's strategic initiatives such as hiring a cash management specialist to complement the rest of the deposit acquisition team and also opening a new loan production office with a seasoned and local lender in the Newberg market which we believe will provide the Bank with countless opportunities in the months and years ahead." 

Equity and Capital

Stockholders' equity for the Company at $28.6 million as of September 30, 2013 has increased $7.1 million, or 33.0%, when compared to the $21.5 million as of December 31, 2012. Besides retained profits for this year, the increase in equity was primarily the result of a successful common stock offering completed this quarter where the Company sold 1,760,222 of its common shares to a variety of accredited investors through a private placement at $3.75 per share for a total of $6.6 million. "While this recently completed stock raise strengthens the Company as a whole, most of the proceeds have been down-streamed to the Bank to bolster its capital levels in support of its continued growth and other strategic objectives," adds Mr. Roby. The Bank's leverage ratio was 10.95% as of September 30, 2013 compared to 8.79% and 8.27% as of December 31, 2012 and September 30, 2012, while its total risk based capital was 14.37% as of September 30, 2013, compared to 12.16% as of December 31, 2012 and 11.71% as of September 30, 2012. 

Current stockholders' equity was up $9.5 million, or 50.0%, when compared to the September 30, 2012 amount of $19.1 million. Besides retained earnings over the past twelve months and the recent stock issuance, also during the fourth quarter of 2012 the Company converted $1.9 million of its 8.50% subordinated notes into 496,596 common shares. 

About Columbia Commercial Bancorp:

Information about the Company's stock may be obtained through the OTCQB marketplace at www.otcmarkets.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 has been named among the "100 Best Companies to Work for in Oregon" by Oregon Business Magazine for 2009, 2011, and 2012.

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 known 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 markets; 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.

   
Consolidated Balance Sheet  
Unaudited  
(amounts in 000s, except per share data and ratios)  
                               
                %               
                Change      December      Change   
    September 30,     2013 vs.       31,     Year-to-  
    2013     2012     2012     2012     Date  
                               
ASSETS                              
  Cash & due from banks   $ 33,387     $ 22,047     51.4 %   $ 19,102     74.8 %
  Federal funds sold     -       5,000     -100.0 %     -     0.0 %
  Investment Securities - Available for Sale     40,726       55,395     -26.5 %     40,019     1.8 %
  Investments - Other     2,168       2,247     -3.5 %     2,227     -2.6 %
                                       
  Gross loans     244,841       243,839     0.4 %     244,765     0.0 %
  Allowance for loan losses     (6,092 )     (6,963 )   -12.5 %     (6,153 )   -1.0 %
    Net loans     238,749       236,876     0.8 %     238,612     0.1 %
                                       
  Other real estate owned     8,993       7,358     22.2 %     7,289     23.4 %
  Other assets     15,175       17,109     -11.3 %     15,370     -1.3 %
                                       
    Total Assets   $ 339,198     $ 346,032     -2.0 %   $ 322,619     5.1 %
                                     
LIABILITIES                                    
  Deposits   $ 236,161     $ 237,872     -0.7 %   $ 227,977     3.6 %
  Repurchase agreements     17,334       24,314     -28.7 %     17,438     -0.6 %
  Federal funds purchased     -       -     0.0 %     -     0.0 %
  FHLB borrowings     41,000       47,900     -14.4 %     41,000     0.0 %
  Other borrowings     2,494       4,516     -44.8 %     2,579     -3.3 %
  Junior subordinated debentures     8,248       8,248     0.0 %     8,248     0.0 %
  Other liabilities     5,366       4,122     30.2 %     3,882     38.2 %
    Total Liabilities     310,603       326,972     -5.0 %     301,124     3.1 %
                                     
STOCKHOLDERS' EQUITY     28,595       19,060     50.0 %     21,495     33.0 %
    Total Liabilities and Stockholders' Equity   $ 339,198     $ 346,032     -2.0 %   $ 322,619     5.1 %
                                     
Shares outstanding at end-of-period     5,535,974       3,241,581             3,759,677        
Book value per share   $ 5.17     $ 5.88           $ 5.72        
Allowance for loan losses to total loans     2.49 %     2.86 %           2.51 %      
Non-performing assets (non-accrual loans & OREO)   $ 18,888     $ 16,766           $ 17,661        
                                     
Bank Tier 1 leverage ratio (5% minimum for "well-capitalized")     10.95 %     8.27 %           8.79 %      
Bank Tier 1 risk-based capital ratio (6% minimum for "well-capitalized")     13.10 %     10.44 %           10.90 %      
Bank Total risk-based capital ratio (10% minimum for "well-capitalized")     14.37 %     11.71 %           12.16 %      
                                     
                                     
                                     
Consolidated Statement of Operations  
Unaudited  
(amounts in 000s, except per share data and ratios)  
                                     
                                     
                                     
    Three Months Ending           Nine Months Ending        
    9/30/
2013
    6/30/
2013
    % Change     9/30/
2013
    9/30/
2012
    % Change  
INTEREST INCOME                                    
  Loans   $ 3,406     $ 3,341     1.9 %   $ 10,075     $ 10,379     -2.9 %
  Investments     146       121     20.7 %     406       655     -38.0 %
  Federal funds sold and other     13       22     -40.9 %     45       55     -18.2 %
    Total interest income     3,565       3,484     2.3 %     10,526       11,089     -5.1 %
                                             
INTEREST EXPENSE                                            
  Deposits     334       366     -8.7 %     1,117       1,697     -34.2 %
  Repurchase agreements and federal funds purchased     12       16     -25.0 %     55       145     -62.1 %
  FHLB borrowings     416       413     0.7 %     1,237       1,520     -18.6 %
  Other borrowings     50       50     0.0 %     150       361     -58.4 %
  Junior subordinated debentures     63       67     -6.0 %     191       195     -2.1 %
    Total interest expense     875       912     -4.1 %     2,750       3,918     -29.8 %
                                             
NET INTEREST INCOME BEFORE PROVISION FOR LOAN LOSSES     2,690       2,572     4.6 %     7,776       7,171     8.4 %
                                             
PROVISION FOR LOAN LOSSES     -       -     0.0 %     -       -     0.0 %
                                             
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES     2,690       2,572     4.6 %     7,776       7,171     8.4 %
                                             
NON-INTEREST INCOME     164       156     5.1 %     464       490     -5.3 %
                                             
NON-INTEREST EXPENSE     2,294       2,235     2.6 %     6,776       6,471     4.7 %
                                             
INVESTMENTS- REALIZED GAINS / (LOSSES)     -       -     0.0 %     -       18     -100.0 %
INVESTMENTS - OTHER THAN TEMPORARY IMPAIRMENT     -       -     0.0 %     -       -     0.0 %
OREO VALUATION ADJUSTMENTS & GAINS/(LOSSES) ON SALES - NET     132       (49 )   369.4 %     220       36     511.1 %
                                             
INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES     692       444     55.9 %     1,684       1,244     35.4 %
                                             
PROVISION (BENEFIT) FOR INCOME TAXES     226       141     60.3 %     547       606     -9.7 %
                                             
NET INCOME (LOSS)   $ 466     $ 303     53.8 %   $ 1,137     $ 638     78.2 %
                                             
Earnings (Loss) per share - Basic   $ 0.10     $ 0.08           $ 0.28     $ 0.20        
                                             
Earnings (Loss) per share - Diluted   $ 0.10     $ 0.08           $ 0.28     $ 0.20        
                                             
Return on average equity     7.98 %     5.51 %           6.80 %     4.58 %      
Return on average assets     0.56 %     0.37 %           0.46 %     0.25 %      
Net interest margin     3.48 %     3.39 %           3.42 %     3.26 %      
Efficiency ratio     80.4 %     81.9 %           82.2 %     84.5 %      
                                             
                                             

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