Community Bank of the Bay Announces 2012 Second Quarter Earnings

OAKLAND, CA--(Marketwire - Jul 30, 2012) - Community Bank of the Bay (OTCBB: CBYAA), a San Francisco Bay Area bank with locations in Oakland, Danville and San Jose, announced operating results for its second quarter ending June 30, 2012.

2012 Second Quarter Earnings Highlights

• Net Income for the 2012 Second Quarter totaled $238 thousand, or $0.06 diluted earnings per share, an increase of $115 thousand, or 93 percent, from $123 thousand, or $0.03 diluted earnings per share, reported in the 2011 Second Quarter. 
• 2012 Second Quarter Net Income included $123 thousand of non-interest income from the gain on sale of securities versus $611 thousand in the 2011 Second Quarter.
• Deposits increased $21.7 million to $132.1 million in the Second Quarter of 2012, including a special temporary deposit of $6.6 million. Excluding this temporary deposit, Deposits have grown $19.5 million, or 18.4 percent, since the 2011 Second Quarter.
• Loans increased $3.4 million to $99.1 million in the Second Quarter of 2012. Loans have grown $13.3 million, or 15.5 percent, since the 2011 Second Quarter.
• Non-Accrual Loans decreased to $4.1 million, or 4.18 percent of Total Loans in the Second Quarter of 2012, versus $4.9 million, or 5.11 percent, at March 31, 2012 and $3.3 million, or 3.84 percent of Total Loans, at June 30, 2011. 
• Net Interest Margin increased nine basis points to 4.78 percent, compared with 4.69 percent for the 2012 First Quarter and eighteen basis points from 4.60 percent for the 2011 Second Quarter.
• Capital Levels remain well above FDIC "Well Capitalized" standards. Second Quarter 2012 Equity of $15.8 million resulted in Tier 1 Leverage of 10.96 percent and Tier 1 Risk-Based and Total Risk-Based Capital Ratios of 15.25 percent and 16.50 percent respectively.

Net income for the 2012 second quarter totaled $238 thousand, or $0.06 diluted earnings per common share, versus $123 thousand, or $0.03 diluted earnings per common share, for the 2011 second quarter. The increase in net income for the 2012 second quarter, versus the comparable quarter last year, is primarily due to a $424 thousand increase in net interest income after loan loss provision and $138 thousand decrease in non-interest expenses. These two positive factors were partially offset by a $488 thousand decrease in securities gains; primarily gains on sale of SBA loans. These results continue a trend of reduced reliance on securities gains as the Bank focuses its efforts on building sustainable core income. 

The growth in net interest income for the 2012 second quarter increased primarily due to growth in average interest-earning assets and an increase of nine basis points to 4.78 percent in our Net Interest Margin. Total assets reached $156.2 million at June 30, 2012, an increase of $23.8 million, or 18 percent, from $132.4 million at June 30, 2011. Average earning assets for the 2012 second quarter reached $129.5 million, an increase of $14.6 million, or 12.7 percent, compared with the 2011 second quarter.

Deposits increased $21.7 million, or 19.6 percent, to $132.1 million during the quarter ending June 30, 2012. Reported deposits include $6.6 million at quarter end from an existing client that is expected to be only temporary in nature. When compared with deposits at June 30, 2011, overall deposit growth for the last twelve months was $26.1 million, or 24.6 percent. 

"We are very happy with the first half of 2012. We have continued to improve our net interest margin and core profitability while adding key members to our team. We have been aggressive in our loan loss provisions and believe we have seen the high water mark in our non-performing loans and look forward to further progress in this important area during the next six months. And most importantly, we continue to attract outstanding new clients to the Bank. Total Assets reached $156.2 million, and even without the special deposit our core deposits have grown over 19 percent year to date. Our commitment to relationship banking, delivered by experienced and passionate professionals, continues to be well received by the communities we serve," stated William S. Keller, President and Chief Executive Officer. 

Loans increased $3.4 million, or 3.6 percent, to $99.1 million during the quarter ending June 30, 2012. When compared with June 30, 2011, loan growth over the last twelve months was $13.3 million, or 15.5 percent. 

Non-Accrual Loans totaled $4.1 million, or 4.18 percent of Total Loans at June 30, 2012, and include $894 thousand of loans guaranteed by the U.S. Small Business Administration. The second quarter total represents a $743 thousand decrease from the prior quarter. 

About Community Bank of the Bay
Community Bank of the Bay (OTCBB: CBYAA) serves the financial needs of closely held businesses and professional service firms, as well as their owner-operators and non-profit organizations throughout the San Francisco Bay Area. Community Bank of the Bay is a member of the FDIC, an SBA Preferred Lender, and a CDARS depository institution, headquartered in Oakland, with offices in San Jose, and Danville, CA. The bank is recognized for establishing the Bay Area Green Fund to provide financing to sustainable businesses and supports environmentally responsible values. Additional information on the bank is available online at www.communitybankbay.com.