SOURCE: Focus Business Bank

Focus Business Bank

April 25, 2012 21:27 ET

Focus Business Bank Announces Unaudited Financial Results for the Quarter Ended March 31, 2012

SAN JOSE, CA--(Marketwire - Apr 25, 2012) - Focus Business Bank (OTCBB: FCSB) announced unaudited financial results, including continued profitability, for the quarter ended March 31, 2012. Record net income of $243,000, or $0.09 per share, was reported for the three months ended March 31, 2012 compared to net income of $51,000, or $0.02 per share, for the comparable quarter in 2011. President and Chief Executive Officer Richard L. Conniff noted, "The Bank continues to experience strong growth in loans as a result of its business development efforts and a gradual but steady improvement in the local economy. While deposits and, correspondingly, cash, declined slightly from the record levels at December 31, 2011, these changes were anticipated as several of the Bank's customers had maintained significantly high balances related to transactions which were completed in the first quarter of 2012. We are very pleased that the Bank's core earnings continue to grow and that we achieved our eighth consecutive profitable quarter."

Assets and Liabilities
Total assets increased to $162.5 million at March 31, 2012, a 20% increase from March 31, 2011. Total loans were $101.2 million at March 31, 2012, a 42% increase from March 31, 2011. Total deposits grew to $138.9 million at March 31, 2012, a 25% increase from March 31, 2011.

Non-interest bearing deposits at March 31, 2012 were $54.6 million, an increase of 42% compared to $38.5 million at March 31, 2011. Non-interest bearing deposits represented 39% of total deposits at March 31, 2012, compared to 35% of total deposits at March 31, 2011.

Net Interest Income
Net interest income for the three-months ended March 31, 2012 was $1,432,000, an increase of 45% compared to $986,000 for the same period in 2011. The net interest margin of 3.77% for the three months ended March 31, 2012 was an improvement compared to 3.05% for the three-months ended March 31, 2011. The increase in net interest margin for the quarter ending March 31, 2012, compared to the prior year quarter, is primarily attributable to the continuing increase in loan volume and a reduction in the cost of interest bearing deposits. At March 31, 2012, the loan to deposit ratio was 73% as compared to 64% at March 31, 2011.

Non-interest Income
Non-interest income was $201,000 for the quarter ended March 31, 2012, compared to $539,000 for the same period in 2011. Non-interest income is primarily composed of gains on the sale of SBA loans originated by the Bank and sold in the SBA market, servicing income related to SBA loans which are sold and service charges related to deposit activities.

Non-Interest Expense
Non-interest expense was $1,360,000 for the three-months ended March 31, 2012, compared to $1,474,000 for the three months ended March 31, 2011. The decrease in non-interest expense for the quarter ended March 31, 2012, compared to the same period in 2011, is primarily attributable to a reduction in equity based compensation expense related to stock options issued when the Bank opened in 2007.

Asset Quality
The Bank made no provision for loan losses in the quarter ended March 31, 2012. The allowance for loan losses was 2.51% of total loans at March 31, 2012, as compared to 3.57% at March 31, 2011. There were no loan charge-offs or recoveries for the quarter ended March 31, 2012. At March 31, 2012, the Bank had no non-performing loans. At March 31, 2011, the Bank had one non-performing loan for $84,000. The Bank has never had other real estate owned.

Capital
Focus Business Bank has capital ratios substantially in excess of the minimum regulatory requirements for a bank to be considered well capitalized. At March 31, 2012, the total risk-based capital ratio was 19.99%.

About Focus Business Bank
Focus Business Bank is dedicated to meeting the banking needs of closely-held businesses and professionals in Santa Clara County. The Bank's office is located at 10 Almaden Boulevard in downtown San Jose, California and offers a variety of commercial banking products including loans, deposits, remote deposit capture and other cash management services oriented toward closely-held businesses and their owners. The Bank specializes in commercial loans and is also an SBA Preferred Lender. The Bank also serves not-for-profit businesses and condominium homeowner associations by offering expertise, market knowledge and specialized products and services to these customers.

Forward-Looking Statements
This release may contain forward-looking statements, such as, among others, statements about plans, expectations and goals concerning growth and improvement. Forward-looking statements are subject to risks and uncertainties. Such risks and uncertainties may include but are not necessarily limited to fluctuations in interest rates, inflation, government regulations and general economic conditions, including the real estate market in California and other factors beyond the Bank's control. Such risks and uncertainties could cause results for subsequent interim periods or for the entire year to differ materially from those indicated. Readers should not place undue reliance on the forward-looking statements, which reflect management's view only as of the date hereof. The Bank undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances.

Focus Business Bank
Selected Financial Information
($ in '000 except per share amounts) As of
BALANCE SHEET 31-Mar-12 31-Dec-11 31-Mar-11 12 Month % Change
Unaudited Unaudited Unaudited
ASSETS
Cash and due from banks
Interest bearing $ 26,908 $ 40,906 $ 26,484 2 %
Non-interest bearing 5,373 4,309 3,190 68 %
Federal funds sold 505 505 505 0 %
Investment securities 26,244 26,205 34,912 -25 %
Loans 101,234 97,401 71,229 42 %
Net deferred loan (fees) costs (1 ) 37 184 -101 %
Allowance for loan losses (2,541 ) (2,541 ) (2,541 ) 0 %
Net Loans 98,692 94,897 68,872 43 %
Other assets $ 4,820 1,702 $ 1,856 160 %
TOTAL ASSETS $ 162,542 $ 168,524 $ 135,819 20 %
LIABILITIES
Deposits
Non-interest bearing $ 54,606 $ 63,196 $ 38,501 42 %
Interest bearing 84,288 81,986 72,692 16 %
Total deposits 138,894 145,182 111,193 25 %
Other liabilities 652 716 2,985 -78 %
TOTAL LIABILITIES 139,546 145,898 114,178 22 %
Stockholders' equity 22,996 22,626 21,641 6 %
LIABILITIES AND STOCKHOLDERS' EQUITY $ 162,542 $ 168,524 $ 135,819 20 %
Book value/share $ 8.26 $ 8.15 $ 7.82 6 %
Balance Sheet Ratios
Loan/deposit 73 % 67 % 64 %
Non-interest/total deposit 39 % 44 % 35 %
Regulatory Capital Ratios
Tier-1 leverage 14.17 % 13.82 % 15.93 %
Tier-1 risk based capital 18.73 % 19.48 % 23.75 %
Total risk-based capital 19.99 % 20.75 % 25.02 %
Asset Quality Metrics
Non-performing loans $ - $ 1,044 $ 84
Non-performing loans/total loans 0.00 % 1.07 % 0.12 %
ALLL/total loans 2.51 % 2.61 % 3.57 %
Focus Business Bank
Selected Financial Information
($ in '000 except per share amounts) Quarters Ended
INCOME STATEMENT 31-Mar-12 31-Dec-11 31-Mar-11
Unaudited Unaudited Unaudited
Interest income $ 1,527 $ 1,465 $ 1,110
Interest expense 95 100 124
Net interest income 1,432 1,365 986
Provision for loan losses - - -
Non-interest income 201 137 539
Non-interest expense 1,360 1,268 1,474
Pre-tax income 273 234 51
Income taxes 30 (5 ) -
Net income $ 243 $ 239 $ 51
Net income per diluted share $ 0.09 $ 0.09 $ 0.02
Performance Metrics
Net interest margin 3.77 % 3.47 % 3.05 %
Return on average assets 0.62 % 0.59 % 0.15 %
Return on average equity 4.28 % 4.20 % 0.96 %

Contact Information

  • Contact:
    Richard L. Conniff
    President and Chief Executive Officer
    408.200.8701
    Email Contact