Attached files
| file | filename |
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| 8-K - FORM 8-K - Bank of Commerce Holdings | boch20170418_8k.htm |
Exhibit 99.1
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(NASDAQ: BOCH) |
For Immediate Release:
Bank of Commerce Holdings Announces Results for the First Quarter of 2017
REDDING, California, April 20, 2017 / GLOBE NEWSWIRE— Randall S. Eslick, President and Chief Executive Officer of Bank of Commerce Holdings (NASDAQ: BOCH) (the “Company”), a $1.1 billion asset bank holding company and parent company of Redding Bank of Commerce (the “Bank”), today announced financial results for the quarter ended March 31, 2017. Net income for the quarter ended March 31, 2017 was $2.3 million or $0.17 per share – diluted, compared with a net loss of $960 thousand or $0.07 per share – diluted for the same period of 2016.
Financial highlights for the first quarter of 2017 compared to the same quarter a year ago:
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● |
Net income of $2.3 million for the three months ended March 31, 2017 was an increase of $3.2 million (338%) from $960 thousand net loss recorded during the same period in the prior year. Net loss for the quarter ended March 31, 2016 included expenses totaling $2.8 million related to the acquisition of five Bank of America branches and the execution of our plans to reconfigure our balance sheet using liquidity provided by those branches. |
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● |
Return on average assets improved to 0.80% for the first quarter of 2017 compared to (0.37)% for the same period in the prior year. |
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● |
Return on average equity improved to 9.63% for the first quarter of 2017 compared to (4.23)% for the same period in the prior year. |
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Deposits at March 31, 2017 totaled $1.0 billion, an increase of $66.8 million (7%) since March 31, 2016. This growth was centered in core deposits in our Sacramento marketplace. |
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● |
Gross loans at March 31, 2017 totaled $810.2 million, an increase of $86.0 million (12%) since March 31, 2016. Most of this growth occurred in our Sacramento marketplace and is the result of investments in our SBA division and in our expanded Sacramento commercial banking group. |
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● |
Tangible book value per common share was $6.97 at March 31, 2017 compared to $6.57 at March 31, 2016. |
Financial highlights for the first quarter of 2017 compared to the prior quarter:
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Net income of $2.3 million for the three months ended March 31, 2017 was a decrease of $45 thousand (8% annualized) from $2.3 million net income earned during the prior quarter. Net income for the three months ended March 31, 2017 included life insurance death benefit proceeds of $502 thousand and a $200 thousand provision for loan and lease losses. |
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Return on average assets was 0.80% for the first quarter of 2017 compared to 0.81% for the prior quarter. |
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Return on average equity decreased to 9.63% for the first quarter of 2017 compared to 9.69% for the prior quarter. |
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Deposits at March 31, 2017 totaled $1.0 billion, a decrease of $176 thousand (0.07% annualized) since December 31, 2016. |
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● |
Gross loans at March 31, 2017 totaled $810.2 million, an increase of $6.0 million (3% annualized) since December 31, 2016. |
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Tangible book value per common share was $6.97 at March 31, 2017 compared to $6.83 at December 31, 2016. |
Randall S. Eslick, President and CEO commented: “It is hard to believe that a full year has already passed since we acquired five new offices from Bank of America. During that time, the buildings have been remodeled and the new staff and customers have been fully integrated into the Redding Bank of Commerce family. Throughout the bank, deposits and loans have continued to increase handsomely which we anticipate will lead to increasing profitability. We applaud the hard work of our employees and acknowledge their accomplishments.”
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(NASDAQ: BOCH) |
Forward-Looking Statements
This quarterly press release includes forward-looking information, which is subject to the “safe harbor” created by the Securities Act of 1933, and Securities Act of 1934. These forward-looking statements (which involve our plans, beliefs and goals, refer to estimates or use similar terms) involve certain risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Such risks and uncertainties include, but are not limited to, the following factors:
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Competitive pressure in the banking industry and changes in the regulatory environment |
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Changes in the interest rate environment and volatility of rate sensitive assets and liabilities |
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A decline in the health of the economy nationally or regionally which could reduce the demand for loans or reduce the value of real estate collateral securing most of our loans |
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Credit quality deterioration which could cause an increase in the provision for loan and lease losses |
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Asset/Liability matching risks and liquidity risks |
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Changes in the securities markets |
For additional information concerning risks and uncertainties related to the Company and its operations please refer to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016 and under the heading: “Risk Factors” and subsequent reports on Form 10-Q and current reports on Form 8-K. Readers are cautioned not to place undue reliance on these forward-looking statements. The Company undertakes no obligation and specifically disclaims any obligation, to revise or publicly release the results of any revision or update to these forward-looking statements to reflect events or circumstances that occur after the date the statements were made.
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(NASDAQ: BOCH) |
TABLE 1
SELECTED FINANCIAL INFORMATION - UNAUDITED
(amounts in thousands except per share data)
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For The Three Months Ended |
||||||||||||
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Net income (loss), average assets and |
March 31, |
December 31, |
||||||||||
|
average shareholders' equity |
2017 |
2016 |
2016 |
|||||||||
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Net income (loss) |
$ | 2,252 | $ | (960 | ) | $ | 2,297 | |||||
|
Average total assets |
$ | 1,148,305 | $ | 1,034,203 | $ | 1,126,034 | ||||||
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Average total earning assets |
$ | 1,075,039 | $ | 969,818 | $ | 1,051,387 | ||||||
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Average shareholders' equity |
$ | 94,820 | $ | 91,307 | $ | 94,326 | ||||||
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Selected performance ratios |
||||||||||||
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Return on average assets |
0.80 |
% |
(0.37 |
)% |
0.81 |
% | ||||||
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Return on average equity |
9.63 |
% |
(4.23 |
)% |
9.69 |
% | ||||||
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Efficiency ratio |
71.49 |
% |
108.08 |
% |
73.15 |
% | ||||||
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Share and per share amounts |
||||||||||||
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Weighted average shares - basic |
13,416 | 13,360 | 13,370 | |||||||||
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Weighted average shares - diluted |
13,521 | 13,403 | 13,476 | |||||||||
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Earnings (loss) per share - basic |
$ | 0.17 | $ | (0.07 | ) | $ | 0.17 | |||||
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Earnings (loss) per share - diluted |
$ | 0.17 | $ | (0.07 | ) | $ | 0.17 | |||||
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At March 31, |
At December 31, |
|||||||||||
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Share and per share amounts |
2017 |
2016 |
2016 |
|||||||||
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Common shares outstanding (1) |
13,517 | 13,442 | 13,440 | |||||||||
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Tangible book value per common share |
$ | 6.97 | $ | 6.57 | $ | 6.83 | ||||||
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Capital ratios |
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Bank of Commerce Holdings |
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Common equity tier 1 capital ratio (2) |
9.71 |
% |
9.82 |
% |
9.43 |
% | ||||||
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Tier 1 capital ratio (2) |
10.72 |
% |
10.93 |
% |
10.42 |
% | ||||||
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Total capital ratio (2) |
13.00 |
% |
13.30 |
% |
12.68 |
% | ||||||
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Tier 1 leverage ratio (2) |
9.09 |
% |
9.48 |
% |
9.13 |
% | ||||||
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Tangible common equity ratio |
8.27 |
% |
8.21 |
% |
8.07 |
% | ||||||
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Redding Bank of Commerce |
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Common equity tier 1 capital ratio (2) |
12.59 |
% |
13.07 |
% |
12.31 |
% | ||||||
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Tier 1 capital ratio (2) |
12.59 |
% |
13.07 |
% |
12.31 |
% | ||||||
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Total capital ratio (2) |
13.84 |
% |
14.32 |
% |
13.55 |
% | ||||||
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Tier 1 leverage ratio (2) |
10.67 |
% |
11.36 |
% |
10.80 |
% | ||||||
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(1) Includes unvested restricted shares issued in accordance with the Company's equity incentive plan. |
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(2) The Company and the Bank continue to meet all capital adequacy requirements to which they are subject. The capital ratios for 2016 were impacted by increased average total assets, the addition of $1.8 million of core deposit intangible and $665 thousand of goodwill recorded in conjunction with the acquisition of five branches in March of 2016. |
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(NASDAQ: BOCH) |
BALANCE SHEET OVERVIEW
As of March 31, 2017, the Company had total consolidated assets of $1.1 billion, gross loans of $810.2 million, allowance for loan and lease losses (“ALLL”) of $11.6 million, total deposits of $1.0 billion, and shareholders’ equity of $96.5 million.
TABLE 2
LOAN BALANCES BY TYPE - UNAUDITED
(amounts in thousands)
|
At March 31, |
At December 31, |
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% of |
% of |
Change |
% of |
|||||||||||||||||||||||||||||
|
2017 |
Total |
2016 |
Total |
Amount |
% |
2016 |
Total |
|||||||||||||||||||||||||
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Commercial |
$ | 145,635 | 19 |
% |
$ | 136,721 | 19 |
% |
$ | 8,914 | 7 |
% |
$ | 153,844 | 19 |
% | ||||||||||||||||
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Real estate - construction and land development |
46,228 | 6 |
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27,554 | 4 |
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18,674 | 68 |
% |
57,771 | 7 |
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Real estate - commercial non-owner occupied |
305,802 | 38 |
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247,840 | 34 |
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57,962 | 23 |
% |
287,455 | 36 |
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Real estate - commercial owner occupied |
164,166 | 20 |
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154,484 | 21 |
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9,682 | 6 |
% |
151,516 | 19 |
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Real estate - residential - ITIN |
44,211 | 5 |
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48,384 | 7 |
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(4,173 | ) | (9 |
)% |
45,566 | 6 |
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Real estate - residential - 1-4 family mortgage |
19,710 | 2 |
|
16,746 | 2 |
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2,964 | 18 |
% |
20,425 | 3 |
| ||||||||||||||||||||
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Real estate - residential - equity lines |
33,019 | 4 |
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38,528 | 5 |
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(5,509 | ) | (14 |
)% |
35,953 | 4 |
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Consumer and other |
51,423 | 6 |
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53,986 | 7 |
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(2,563 | ) | (5 |
)% |
51,681 | 6 |
| |||||||||||||||||||
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Gross loans |
810,194 | 100 |
% |
724,243 | 99 |
% |
85,951 | 12 |
% |
804,211 | 100 |
% | ||||||||||||||||||||
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Deferred fees and costs |
1,446 |
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985 | 461 | 1,324 | |||||||||||||||||||||||||||
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Loans, net of deferred fees and costs |
811,640 | 725,228 | 86,412 | 805,535 | ||||||||||||||||||||||||||||
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Allowance for loan and lease losses |
(11,641 | ) | (11,495 | ) | (146 | ) | (11,544 | ) | ||||||||||||||||||||||||
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Net loans |
$ | 799,999 | $ | 713,733 | $ | 86,266 | $ | 793,991 | ||||||||||||||||||||||||
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Average yield on loans during the quarter |
4.72 | % | 4.72 | % | - | 4.69 | % | |||||||||||||||||||||||||
The Company recorded gross loan balances of $810.2 million at March 31, 2017, compared with $724.2 million and $804.2 million at March 31, 2016 and December 31, 2016, respectively, an increase of $86.0 million and $6.0 million, respectively. The increase in gross loans compared to the same period a year ago and the prior period was driven by organic loan originations and is the result of investments in our SBA division and in our expanded Sacramento commercial banking group.
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(NASDAQ: BOCH) |
TABLE 3
CASH, CASH EQUIVALENTS, AND INVESTMENT SECURITIES - UNAUDITED
(amounts in thousands)
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At March 31, |
At December 31, |
|||||||||||||||||||||||||||||||
|
% of |
% of |
Change |
% of |
|||||||||||||||||||||||||||||
|
2017 |
Total |
2016 |
Total |
Amount |
% |
2016 |
Total |
|||||||||||||||||||||||||
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Cash and due from banks |
$ | 18,315 | 7 |
% |
$ | 14,969 | 5 |
% |
$ | 3,346 | 22 |
% |
$ | 16,419 | 6 |
% | ||||||||||||||||
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Interest-bearing deposits in other banks |
42,744 | 16 | 70,781 | 24 | (28,037 | ) | (40 |
)% |
51,988 | 19 | ||||||||||||||||||||||
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Total cash and cash equivalents |
61,059 | 23 | 85,750 | 29 | (24,691 | ) | (29 |
)% |
68,407 | 25 | ||||||||||||||||||||||
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Investment securities: |
||||||||||||||||||||||||||||||||
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U.S. government and agencies |
12,496 | 5 | 15,645 | 5 | (3,149 | ) | (20 |
)% |
10,354 | 4 | ||||||||||||||||||||||
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Obligations of state and political subdivisions |
55,663 | 20 | 61,288 | 21 | (5,625 | ) | (9 |
)% |
59,428 | 22 | ||||||||||||||||||||||
|
Residential mortgage backed securities and collateralized mortgage obligations |
82,392 | 30 | 51,721 | 18 | 30,671 | 59 |
% |
69,604 | 24 | |||||||||||||||||||||||
|
Corporate securities |
10,448 | 4 | 23,764 | 8 | (13,316 | ) | (56 |
)% |
16,116 | 6 | ||||||||||||||||||||||
|
Commercial mortgage backed securities |
16,522 | 6 | 14,571 | 5 | 1,951 | 13 |
% |
15,514 | 6 | |||||||||||||||||||||||
|
Other asset backed securities |
4,013 | 1 | 7,262 | 2 | (3,249 | ) | (45 |
)% |
4,158 | 2 | ||||||||||||||||||||||
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Total investment securities - AFS |
181,534 | 66 | 174,251 | 59 | 7,283 | 4 |
% |
175,174 | 64 | |||||||||||||||||||||||
|
Obligations of state and political subdivisions - HTM |
31,257 | 11 | 35,357 | 12 | (4,100 | ) | (12 |
)% |
31,187 | 11 | ||||||||||||||||||||||
|
Total investment securities - AFS and HTM |
212,791 | 77 | 209,608 | 71 | 3,183 | 2 |
% |
206,361 | 75 | |||||||||||||||||||||||
|
Total cash, cash equivalents and investment securities |
$ | 273,850 | 100 |
% |
$ | 295,358 | 100 |
% |
$ | (21,508 | ) | (7 |
)% |
$ | 274,768 | 100 |
% | |||||||||||||||
|
Average yield on interest bearing due from banks and investment securities during the quarter |
2.17 | % | 2.35 | % | (0.18 | ) | 1.95 | % | ||||||||||||||||||||||||
As of March 31, 2017, we maintained noninterest-bearing cash positions of $18.3 million and interest-bearing deposits in the amount of $42.7 million at the Federal Reserve Bank and correspondent banks. During the first quarter of 2017, we continued to deploy liquidity provided by the March 2016 branch acquisition and by strong organic deposit growth into loan originations and available for sale securities.
Available-for-sale investment securities totaled $181.5 million at March 31, 2017, compared with $174.3 million and $175.2 million at March 31, 2016 and December 31, 2016, respectively. Our available-for-sale investment portfolio provides us with a secondary source of liquidity to fund other higher yielding asset opportunities, such as loan originations and wholesale loan purchases. During the first quarter of 2017 we purchased 18 securities with a par value of $23.7 million and weighted average yield of 2.52% and sold 14 securities with a par value of $13.5 million and weighted average yield of 2.06%. The sales activity on available for sale securities resulted in $66 thousand in net realized gains. During the same period, we received $4.3 million in proceeds from principal payments, calls and maturities within the available-for-sale investment securities portfolio. Average securities balances and weighted average tax equivalent yields for the quarters ended March 31, 2017 and 2016 were $211.1 million and 3.06% compared to $197.8 million and 3.42%, respectively.
At March 31, 2017, our net unrealized losses on available-for-sale investment securities were $891 thousand compared with net unrealized gains of $1.7 million and net unrealized losses of $1.3 million at March 31, 2016 and December 31, 2016, respectively. The decrease in net unrealized losses between December 31, 2016 and March 31, 2017 is primarily due to significant changes in market interest rates over the past three months.
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(NASDAQ: BOCH) |
TABLE 4
DEPOSITS BY TYPE - UNAUDITED
(amounts in thousands)
|
At March 31, |
At December 31, |
|||||||||||||||||||||||||||||||
|
% of |
% of |
Change |
% of |
|||||||||||||||||||||||||||||
|
2017 |
Total |
2016 |
Total |
Amount |
% |
2016 |
Total |
|||||||||||||||||||||||||
|
Demand - noninterest bearing |
$ | 270,412 | 27 |
% |
$ | 212,758 | 23 |
% |
$ | 57,654 | 27 |
% |
$ | 270,398 | 27 |
% | ||||||||||||||||
|
Demand - interest bearing |
407,784 | 41 | 392,325 | 42 | 15,459 | 4 |
% |
405,569 | 40 |
| ||||||||||||||||||||||
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Total demand |
678,196 | 68 | 605,083 | 65 | 73,113 | 12 |
% |
675,967 | 67 |
| ||||||||||||||||||||||
|
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Savings |
112,738 | 11 | 105,828 | 11 | 6,910 | 7 |
% |
113,309 | 11 |
| ||||||||||||||||||||||
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Total non-maturing deposits |
790,934 | 79 | 710,911 | 76 | 80,023 | 11 |
% |
789,276 | 78 |
| ||||||||||||||||||||||
|
|
| |||||||||||||||||||||||||||||||
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Certificates of deposit |
213,556 | 21 | 226,756 | 24 | (13,200 | ) | (6 |
)% |
215,390 | 22 |
| |||||||||||||||||||||
|
Total deposits |
$ | 1,004,490 | 100 |
% |
$ | 937,667 | 100 |
% |
$ | 66,823 | 7 |
% |
$ | 1,004,666 | 100 |
% | ||||||||||||||||
|
Average rate on interest bearing deposits during the quarter |
0.39 | % | 0.48 | % | (0.09 | ) | 0.40 | % | ||||||||||||||||||||||||
|
Average rate on all deposits during the quarter |
0.29 | % | 0.37 | % | (0.08 | ) | 0.29 | % | ||||||||||||||||||||||||
Total deposits at March 31, 2017, increased $66.8 million or 7% to $1.0 billion compared to March 31, 2016, and decreased $176 thousand or 0.07% annualized compared to December 31, 2016. Total non-maturing deposits increased $80.0 million or 11% compared to the same date a year ago and increased $1.7 million or 1% annualized compared to December 31, 2016. Certificates of deposit decreased $13.2 million or 6% compared to the same date a year ago and decreased $ 1.8 million or 3% annualized compared to December 31, 2016.
During the first quarter of 2016 the branch acquisition provided new deposits totaling $149.0 million and we called and redeemed $17.5 million of brokered certificates of deposit. At March 31, 2017, the deposits in the acquired branches totaled $153.0 million.
TABLE 5
WHOLESALE AND BROKERED DEPOSITS - UNAUDITED
(amounts in thousands)
|
At March 31, |
At December 31, |
|||||||||||
|
2017 |
2016 |
2016 |
||||||||||
|
CDARS / ICS reciprocal brokered deposits |
$ | 55,565 | $ | 61,601 | $ | 65,212 | ||||||
|
Online listing service wholesale time deposits |
47,429 | 55,986 | 48,900 | |||||||||
|
Total wholesale and brokered deposits |
$ | 102,994 | $ | 117,587 | $ | 114,112 | ||||||
In accordance with regulatory Call Report instructions, the Bank will file (or has filed) quarterly Call Reports which list brokered deposits of $55.6 million, $61.6 million and $65.2 million at March 31, 2017, March 31, 2016 and December 31, 2016, respectively.
(NASDAQ: BOCH)
INCOME STATEMENT OVERVIEW
TABLE 6
SUMMARY INCOME STATEMENT - UNAUDITED
(amounts in thousands, except per share data)
|
For The Three Months Ended |
||||||||||||||||||||||||||||
|
March 31, |
Change |
December 31, |
Change |
|||||||||||||||||||||||||
|
2017 |
2016 |
Amount |
% |
2016 |
Amount |
% |
||||||||||||||||||||||
|
Interest income |
$ | 10,817 | $ | 9,904 | $ | 913 | 9 |
% |
$ | 10,518 | $ | 299 | 3 |
% | ||||||||||||||
|
Interest expense |
1,083 | 1,600 | (517 | ) | (32 |
)% |
1,084 | (1 | ) | 0 |
% | |||||||||||||||||
|
Net interest income |
9,734 | 8,304 | 1,430 | 17 |
% |
9,434 | 300 | 3 |
% | |||||||||||||||||||
|
Provision for loan and lease losses |
200 | — | 200 | 100 |
% |
— | 200 | 100 |
% | |||||||||||||||||||
|
Noninterest income |
1,542 | 949 | 593 | 62 |
% |
1,250 | 292 | 23 |
% | |||||||||||||||||||
|
Noninterest expense: |
|
| ||||||||||||||||||||||||||
|
Branch acquisition and balance sheet reconfiguration costs |
— | 2,795 | (2,795 | ) | (100 |
)% |
— | — | — |
% | ||||||||||||||||||
|
Other noninterest expense |
8,061 | 7,206 | 855 | 12 |
% |
7,815 | 246 | 3 |
% | |||||||||||||||||||
|
Income (loss) before provision for income taxes |
3,015 | (748 | ) | 3,763 | 503 |
% |
2,869 | 146 | 5 |
% | ||||||||||||||||||
|
Deferred tax asset write-off |
— | 363 | (363 | ) | 100 |
% |
— | — | — |
% | ||||||||||||||||||
|
Provision (benefit) for income taxes |
763 | (151 | ) | 914 | 605 |
% |
572 | 191 | 33 |
% | ||||||||||||||||||
|
Net income (loss) |
$ | 2,252 | $ | (960 | ) | $ | 3,212 | 335 |
% |
$ | 2,297 | (45 | ) | (2 |
)% | |||||||||||||
|
|
| |||||||||||||||||||||||||||
|
Basic earnings (loss) per share |
$ | 0.17 | $ | (0.07 | ) | $ | 0.24 | 343 |
% |
$ | 0.17 | $ | — | — |
% | |||||||||||||
|
Average basic shares |
13,416 | 13,360 | 56 | — |
% |
13,370 | 46 | — |
% | |||||||||||||||||||
|
Diluted earnings (loss) per share |
$ | 0.17 | $ | (0.07 | ) | $ | 0.24 | 343 |
% |
$ | 0.17 | $ | — | — |
% | |||||||||||||
|
Average diluted shares |
13,521 | 13,403 | 118 | 1 |
% |
13,476 | 45 | — |
% | |||||||||||||||||||
|
Dividends declared per common share |
$ | 0.03 | $ | 0.03 | $ | — | — |
% |
$ | 0.03 | $ | — | — |
% | ||||||||||||||
First Quarter of 2017 Compared With First Quarter of 2016
Net income for the first quarter of 2017 increased $3.2 million compared to the first quarter of 2016. In the current quarter, net interest income was $1.4 million higher, noninterest income was $593 thousand higher, and noninterest expense was $1.9 million lower. These positive changes were offset by a provision for loan and lease losses that was $200 thousand higher and a provision for income tax that was $551 thousand higher.
Net Interest Income
Net interest income increased $1.4 million compared to the same period a year ago.
Interest income for the three months ended March 31, 2017 increased $913 thousand or 9% to $10.8 million. Interest and fees on loans increased $933 thousand due to increased average loan balances. Interest on interest-bearing deposits due from banks increased $39 thousand while interest on securities decreased $59 thousand.
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(NASDAQ: BOCH) |
Interest expense for the first quarter of 2017 decreased $517 thousand or 32% to $1.1 million. The net decrease was primarily caused by a $484 thousand decrease in interest on FHLB term debt. During the first quarter of 2016 all FHLB term debt was repaid and an interest rate hedge associated with $75.0 million of that debt was terminated.
Noninterest Income
Noninterest income for the three months ended March 31, 2017 increased $593 thousand compared to the same period a year previous. Our branch and offsite ATM acquisition completed in the first quarter of 2016, enhanced point of sale and ATM fees by $174 thousand and enhanced service charges on deposit accounts by $55 thousand. During the current quarter we also recognized life insurance death benefit proceeds of $502 thousand.
Noninterest Expense
Noninterest expense for the three months ended March 31, 2017 decreased $1.9 million compared to the same period a year previous. The primary components of the net decrease were:
|
● |
Branch acquisition and balance sheet reconfiguration costs decreased $2.8 million |
|
● |
Salaries and related benefits costs increased $433 thousand |
|
● |
Sales incentives and commissions increased $196 thousand |
|
● |
Occupancy costs increased $259 thousand |
Income Tax Provision.
During the three months ended March 31, 2017, the Company recorded a provision for income taxes of $763 thousand (25.31% of pretax income of $3.0 million). Life insurance death benefits of $502 thousand recorded during the current quarter are not subject to income tax and if excluded from pretax income the effective tax rate would have been 30.36%.
During the three months ended March 31, 2016, the Company recorded an income tax benefit of $151 thousand (20.19% of pretax operating losses of $748) The write-off of a $363 thousand deferred tax asset during the quarter resulted in a net expense of $212 thousand.
First Quarter of 2017 Compared With Fourth Quarter of 2016
Net income for the first quarter of 2017 decreased $45 thousand compared to the fourth quarter of 2016. In the current quarter, net interest income was $300 thousand higher and noninterest income was $292 thousand higher. These positive changes were offset by an increase in the provision for loan and lease losses of $200 thousand, noninterest expenses that were $246 thousand higher and a provision for income taxes that were $191 thousand higher.
Net Interest Income
Net interest income increased $300 thousand over the prior quarter.
Interest income for the three months ended March 31, 2017 increased $299 thousand or 12% annualized to $10.8 million compared to the prior quarter. Interest and fees on loans increased $203 thousand due to increased average balances and increased yields. Interest on interest bearing deposits due from banks increased $4 thousand due to increased yields. Interest on investment securities increased $92 thousand due to increased average balances and increased yields.
Interest expense for the three months ended March 31, 2017 decreased $1 thousand or 4% annualized to $1.1 million compared to the prior quarter. Average total deposits for the first quarter of 2017 increased $22.6 million from the fourth quarter of 2016. The growth was in low cost core deposits.
(NASDAQ: BOCH)
Noninterest Income
Noninterest income for the three months ended March 31, 2017 increased $292 thousand compared to the prior quarter. During the current quarter we recognized income from life insurance death benefit proceeds of $502 thousand. Dividends on Federal Home Loan Bank of San Francisco stock decreased $250 thousand primarily due to a special dividend recorded in the prior quarter.
Noninterest Expense
Noninterest expense for the three months ended March 31, 2017 increased $246 thousand compared to the prior quarter. The primary components of the net increase were:
|
● |
Salaries and related benefits costs increased $269 thousand |
|
● |
Employee vacation accrual costs increased $236 thousand |
|
● |
Deferred loan origination costs decreased $116 thousand |
|
● |
Professional service fees decreased $88 thousand |
|
● |
Data processing fees decreased $126 thousand |
|
● |
Advertising costs decreased $77 thousand |
Income Tax Provision
During the three months ended March 31, 2017, we recorded a provision for income taxes of $763 thousand (25.31% of pretax income) compared with a provision for income taxes of $572 thousand (19.94% of pretax income) for the prior quarter. Our income tax provision is composed of two main components: 1) federal and state income taxes based on our income and 2) amortization of our investments in affordable housing partnerships. The increase in the effective tax rate during the three months ended March 31, 2017 when compared to the prior quarter is due to an adjustment we made to the amortization of our investments in affordable housing partnerships during the prior quarter.
Earnings Per Share
Diluted earnings per share were $0.17 for the three months ended March 31, 2017 compared with diluted loss per share of $0.07 for the same period a year ago, and diluted earnings of $0.17 for the prior period. The number of shares outstanding during these periods has not changed significantly. Changes in earnings per share are the result of changes in net income.
|
|
(NASDAQ: BOCH) |
TABLE 7
NET INTEREST MARGIN - UNAUDITED
(amounts in thousands)
|
For The Three Months Ended |
||||||||||||||||||||||||||||||||||||
|
March 31, 2017 |
March 31, 2016 |
December 31, 2016 |
||||||||||||||||||||||||||||||||||
|
Average |
Yield / |
Average |
Yield / |
Average |
Yield / |
|||||||||||||||||||||||||||||||
|
(Amounts in thousands) |
Balance |
Interest(1) |
Rate |
Balance |
Interest(1) |
Rate |
Balance |
Interest(1) |
Rate |
|||||||||||||||||||||||||||
|
Interest-earning assets: |
||||||||||||||||||||||||||||||||||||
|
Net loans (2) |
$ | 806,793 | $ | 9,384 | 4.72 |
% |
$ | 720,795 | $ | 8,451 | 4.72 |
% |
$ | 778,458 | $ | 9,181 | 4.69 |
% | ||||||||||||||||||
|
Taxable securities |
137,582 | 789 | 2.33 |
% |
119,917 | 784 | 2.63 |
% |
124,881 | 705 | 2.25 |
% | ||||||||||||||||||||||||
|
Tax-exempt securities |
73,524 | 530 | 2.92 |
% |
77,852 | 594 | 3.07 |
% |
72,288 | 522 | 2.87 |
% | ||||||||||||||||||||||||
|
Interest-bearing deposits in other banks |
57,140 | 114 | 0.81 |
% |
51,254 | 75 | 0.59 |
% |
75,760 | 110 | 0.58 |
% | ||||||||||||||||||||||||
|
Average interest-earning assets |
1,075,039 | 10,817 | 4.08 |
% |
969,818 | 9,904 | 4.11 |
% |
1,051,387 | 10,518 | 3.98 |
% | ||||||||||||||||||||||||
|
Cash and due from banks |
16,873 |
|
12,301 |
|
16,953 |
| ||||||||||||||||||||||||||||||
|
Premises and equipment, net |
16,165 |
|
12,384 |
|
16,331 |
| ||||||||||||||||||||||||||||||
|
Other assets |
40,228 |
|
39,700 |
|
41,363 |
| ||||||||||||||||||||||||||||||
|
Average total assets |
$ | 1,148,305 |
|
$ | 1,034,203 |
|
$ | 1,126,034 |
| |||||||||||||||||||||||||||
|
|
|
| ||||||||||||||||||||||||||||||||||
|
Interest-bearing liabilities: |
|
|
| |||||||||||||||||||||||||||||||||
|
Interest-bearing demand |
$ | 420,416 | 148 | 0.14 |
% |
$ | 323,771 | 122 | 0.15 |
% |
$ | 398,749 | 135 | 0.13 |
% | |||||||||||||||||||||
|
Savings deposits |
113,647 | 47 | 0.17 |
% |
96,027 | 45 | 0.19 |
% |
111,755 | 45 | 0.16 |
% | ||||||||||||||||||||||||
|
Certificates of deposit |
215,202 | 529 | 1.00 |
% |
221,836 | 597 | 1.08 |
% |
217,463 | 543 | 0.99 |
% | ||||||||||||||||||||||||
|
Net term debt |
18,598 | 293 | 6.39 |
% |
91,444 | 782 | 3.44 |
% |
18,975 | 298 | 6.25 |
% | ||||||||||||||||||||||||
|
Junior subordinated debentures |
10,310 | 66 | 2.60 |
% |
10,310 | 54 | 2.11 |
% |
10,310 | 63 | 2.43 |
% | ||||||||||||||||||||||||
|
Average interest-bearing liabilities |
778,173 | 1,083 | 0.56 |
% |
743,388 | 1,600 | 0.87 |
% |
757,252 | 1,084 | 0.57 |
% | ||||||||||||||||||||||||
|
Noninterest-bearing demand |
262,881 |
|
182,539 |
|
261,600 |
| ||||||||||||||||||||||||||||||
|
Other liabilities |
12,431 |
|
16,969 |
|
12,856 |
| ||||||||||||||||||||||||||||||
|
Shareholders’ equity |
94,820 |
|
91,307 |
|
94,326 |
| ||||||||||||||||||||||||||||||
|
Average liabilities and shareholders’ equity |
$ | 1,148,305 |
|
$ | 1,034,203 |
|
$ | 1,126,034 |
| |||||||||||||||||||||||||||
|
Net interest income and net interest margin (4) |
$ | 9,734 | 3.67 |
% |
$ | 8,304 | 3.44 |
% |
$ | 9,434 | 3.57 |
% | ||||||||||||||||||||||||
|
Tax equivalent net interest margin (3) |
3.78 |
% |
3.57 |
% |
3.67 |
% | ||||||||||||||||||||||||||||||
|
(1) Interest income on loans is net of deferred fees and costs of approximately $197 thousand, $315 thousand, and $139 thousand for the three months ended March 31, 2017, and 2016 and December 31, 2016, respectively. | ||||||||||||||||||
|
(2) Net loans includes average nonaccrual loans of $10.9 million, $10.4 million and $10.0 million for the three months ended March 31, 2017 and 2016 and December 31, 2016 respectively. | ||||||||||||||||||
|
(3) Tax-exempt income has been adjusted to tax equivalent basis at a 34% tax rate. The amount of such adjustments was an addition to recorded income of approximately $273 thousand, $306 thousand and $269 thousand for the three months ended March 31, 2017 and 2016 and December 31, 2016, respectively. | ||||||||||||||||||
|
(4) Net interest margin is net interest income expressed as a percentage of average interest-earning assets. |
|
|
(NASDAQ: BOCH) |
The current quarter net interest margin increased ten basis points to 3.67% as compared to the prior quarter due to increased yields on average interest earning assets. Increases in the average balances of the loan and investment portfolios were funded by increased average balances in low cost deposits and decreased average balances in interest-bearing deposits in other banks.
The net interest margin was 3.67% for the current quarter compared to 3.44% for the same period a year ago. The 3 basis point decrease in yield on average earning assets was offset by a 26 basis point decrease in interest expense to fund average earning assets. The increase in interest income compared to the same quarter in the prior year is due to increased volume in the loan and investment portfolios. The decrease in interest expense resulted from our acquisition of low cost core deposits and our ability to restructure our balance sheet.
Average deposit balances increased $22.6 million and $188.0 million compared to the prior quarter and the same period a year ago respectively. The increase in average deposit balances compared to the prior quarter was organic growth in core deposits. The increase in average deposit balances compared to the same period a year ago results from both the March 2016 branch acquisition and strong organic growth in core deposits. Our overall cost of total deposits decreased to 0.29% for the quarter ended March 31, 2017 from 0.37% for the same period a year ago and were unchanged from 0.29% for the prior quarter.
|
|
(NASDAQ: BOCH) |
TABLE 8
ALLOWANCE FOR LOAN AND LEASE LOSSES ROLL FORWARD AND IMPAIRED LOAN TOTALS - UNAUDITED
(amounts in thousands)
|
For The Three Months Ended |
||||||||||||||||||||
|
March 31, |
December 31, |
September 30, |
June 30, |
March 31, |
||||||||||||||||
|
2017 |
2016 |
2016 |
2016 |
2016 |
||||||||||||||||
|
Beginning balance |
$ | 11,544 | $ | 11,849 | $ | 11,864 | $ | 11,495 | $ | 11,180 | ||||||||||
|
Provision for loan and lease losses |
200 | — | — | — | — | |||||||||||||||
|
Loans charged-off |
(447 | ) | (386 | ) | (357 | ) | (1,734 | ) | (307 | ) | ||||||||||
|
Loan loss recoveries |
344 | 81 | 342 | 2,103 | 622 | |||||||||||||||
|
Ending balance |
$ | 11,641 | $ | 11,544 | $ | 11,849 | $ | 11,864 | $ | 11,495 | ||||||||||
|
At March 31, |
At December 31, |
At September 30, |
At June 30, |
At March 31, |
||||||||||||||||
|
2017 |
2016 |
2016 |
2016 |
2016 |
||||||||||||||||
|
Nonaccrual loans: |
||||||||||||||||||||
|
Commercial |
$ | 2,534 | $ | 2,749 | $ | 1,710 | $ | 2,149 | $ | 2,563 | ||||||||||
|
Real estate - commercial non-owner occupied |
1,196 | 1,196 | 1,196 | 1,197 | 1,197 | |||||||||||||||
|
Real estate - commercial owner occupied |
654 | 784 | 800 | 816 | 1,190 | |||||||||||||||
|
Real estate - residential - ITIN |
3,331 | 3,576 | 3,392 | 3,664 | 3,705 | |||||||||||||||
|
Real estate - residential - 1-4 family mortgage |
1,337 | 1,914 | 1,798 | 1,824 | 1,742 | |||||||||||||||
|
Real estate - residential - equity lines |
906 | 917 | 942 | 995 | 1,270 | |||||||||||||||
|
Consumer and other |
39 | 250 | 252 | 266 | 31 | |||||||||||||||
|
Total nonaccrual loans |
9,997 | 11,386 | 10,090 | 10,911 | 11,698 | |||||||||||||||
|
Accruing troubled debt restructured loans: |
||||||||||||||||||||
|
Commercial |
741 | 776 | 726 | 760 | 40 | |||||||||||||||
|
Real estate - commercial non-owner occupied |
808 | 808 | 811 | 816 | 821 | |||||||||||||||
|
Real estate - residential - ITIN |
4,761 | 5,033 | 5,280 | 5,336 | 5,502 | |||||||||||||||
|
Real estate - residential - equity lines |
450 | 454 | 543 | 548 | 553 | |||||||||||||||
|
Total accruing troubled debt restructured loans |
6,760 | 7,071 | 7,360 | 7,460 | 6,916 | |||||||||||||||
|
All other accruing impaired loans |
— | 337 | 483 | 550 | 488 | |||||||||||||||
|
Total impaired loans |
$ | 16,757 | $ | 18,794 | $ | 17,933 | $ | 18,921 | $ | 19,102 | ||||||||||
|
Gross loans outstanding at period end |
$ | 810,194 | $ | 804,211 | $ | 779,019 | $ | 754,140 | $ | 724,243 | ||||||||||
|
Allowance for loan and lease losses as a percent of: |
||||||||||||||||||||
|
Gross loans |
1.44 |
% |
1.44 |
% |
1.52 |
% |
1.57 |
% |
1.59 |
% | ||||||||||
|
Nonaccrual loans |
116.44 |
% |
101.39 |
% |
117.43 |
% |
108.73 |
% |
98.26 |
% | ||||||||||
|
Impaired loans |
69.47 |
% |
61.42 |
% |
66.07 |
% |
62.70 |
% |
60.18 |
% | ||||||||||
|
Nonaccrual loans to gross loans |
1.23 |
% |
1.42 |
% |
1.30 |
% |
1.45 |
% |
1.62 |
% | ||||||||||
We realized net loan charge-offs of $103 thousand in the current quarter compared with net loan loss charge-offs of $305 thousand in the prior quarter and net loan recoveries of $315 thousand for the same period a year ago. Charge-offs during the first quarter of 2017 of $447 thousand were primarily associated with purchased consumer loans and residential real estate loans.
(NASDAQ: BOCH)
We continue to monitor credit quality, and adjust the ALLL to ensure that the ALLL is maintained at a level that is adequate to cover estimated credit losses in the loan and lease portfolio. A combination of net loan losses and loan portfolio growth supported management’s decision to record a $200 thousand provision for loan and lease losses during the quarter ended March 31, 2017. There were no provisions for loan and lease losses during the previous eight consecutive quarters. Our ALLL as a percentage of gross loans was 1.44% as of March 31, 2017 compared to 1.59% as of March 31, 2016 and 1.44% as of December 31, 2016. Based on the Bank’s ALLL methodology, which uses criteria such as risk weighting and historical loss rates, and given the ongoing improvements in asset quality, management believes the Company’s ALLL is adequate at March 31, 2017. There is, however, no assurance that future loan and lease losses will not exceed the levels provided for in the ALLL and could possibly result in future charges to the provision for loan and lease losses.
At March 31, 2017, the recorded investment in loans classified as impaired totaled $16.8 million, with a corresponding specific reserve of $1.3 million compared to impaired loans of $19.1 million with a corresponding specific reserve of $1.1 million at March 31, 2016 and impaired loans of $18.8 million, with a corresponding specific reserve of $1.5 million at December 31, 2016. The decrease in loans classified as impaired and the decrease in the corresponding specific reserve compared to the prior quarter is primarily due to two commercial real estate relationships and one residential real estate relationship.
TABLE 9
PERIOD END TROUBLED DEBT RESTRUCTURINGS - UNAUDITED
(amounts in thousands)
|
At March 31, |
At December 31, |
At September 30, |
At June 30, |
At March 31, |
||||||||||||||||
|
2017 |
2016 |
2016 |
2016 |
2016 |
||||||||||||||||
|
Nonaccrual |
$ | 4,570 | $ | 4,995 | $ | 3,795 | $ | 3,785 | $ | 4,516 | ||||||||||
|
Accruing |
6,760 | 7,071 | 7,360 | 7,460 | 6,916 | |||||||||||||||
|
Total troubled debt restructurings |
$ | 11,330 | $ | 12,066 | $ | 11,155 | $ | 11,245 | $ | 11,432 | ||||||||||
|
Percentage of total gross loans |
1.40 |
% |
1.50 |
% |
1.43 |
% |
1.49 |
% |
1.58 |
% | ||||||||||
Loans are reported as a troubled debt restructuring when we grant a concession(s) to a borrower experiencing financial difficulties that it would not otherwise consider. Examples of such concessions include a reduction in the loan rate, forgiveness of principal or accrued interest, extending the maturity date(s) significantly, or providing a lower interest rate than would be normally available for a transaction of similar risk. As a result of these concessions, restructured loans are impaired as we will not collect all amounts due, either principal or interest, in accordance with the terms of the original loan agreement. Specific reserves on non-collateral dependent restructured loans are measured by calculating the present value of expected future cash flows of the restructured loans, discounted at the effective interest rate of the original loan agreement. These specific reserves are recognized as a specific component to be provided for in the ALLL.
There were no new troubled debt restructurings during the three months ended March 31, 2017. As of March 31, 2017, we had 118 restructured loans that qualified as troubled debt restructurings, of which 110 were performing according to their restructured terms.
|
|
(NASDAQ: BOCH) |
TABLE 10
NONPERFORMING ASSETS - UNAUDITED
(amounts in thousands)
|
At March 31, |
At December 31, |
At September 30, |
At June 30, |
At March 31, |
||||||||||||||||
|
2017 |
2016 |
2016 |
2016 |
2016 |
||||||||||||||||
|
Total nonaccrual loans |
$ | 9,997 | $ | 11,386 | $ | 10,090 | $ | 10,911 | $ | 11,698 | ||||||||||
|
90 days past due and still accruing |
— | — | — | 10 | — | |||||||||||||||
|
Total nonperforming loans |
9,997 | 11,386 | 10,090 | 10,921 | 11,698 | |||||||||||||||
|
Other real estate owned |
814 | 759 | 793 | 765 | 1,011 | |||||||||||||||
|
Total nonperforming assets |
$ | 10,811 | $ | 12,145 | $ | 10,883 | $ | 11,686 | $ | 12,709 | ||||||||||
|
Nonperforming loans to gross loans |
1.23 |
% |
1.42 |
% |
1.30 |
% |
1.45 |
% |
1.62 |
% | ||||||||||
|
Nonperforming assets to total assets |
0.95 |
% |
1.06 |
% |
0.98 |
% |
1.09 |
% |
1.18 |
% | ||||||||||
The decrease in nonaccrual loans during the first quarter of 2017 was associated with loans paid off for one commercial real estate relationship, one residential real estate relationship and one consumer relationship.
The March 31, 2017 OREO balance consists of seven properties, of which four are 1-4 family residential real estate properties in the amount of $121 thousand, two are nonfarm nonresidential properties in the amount of $581 thousand and one is an undeveloped commercial property in the amount of $112 thousand.
|
|
(NASDAQ: BOCH) |
TABLE 11
UNAUDITED CONSOLIDATED
BALANCE SHEET
(amounts in thousands, except per share data)
| At March 31, | At March 31, | Change | At December 31, | |||||||||||||||||
| 2017 | 2016 | $ | % | 2016 | ||||||||||||||||
| Assets: | ||||||||||||||||||||
|
Cash and due from banks |
$ | 18,315 | $ | 14,969 | $ | 3,346 | 22 |
% |
$ | 16,419 | ||||||||||
|
Interest-bearing deposits in other banks |
42,744 | 70,781 | (28,037 | ) | (40 |
)% |
51,988 | |||||||||||||
|
Total cash and cash equivalents |
61,059 | 85,750 | (24,691 | ) | (29 |
)% |
68,407 | |||||||||||||
|
|
||||||||||||||||||||
|
Securities available-for-sale, at fair value |
181,534 | 174,251 | 7,283 | 4 |
% |
175,174 | ||||||||||||||
|
Securities held-to-maturity, at amortized cost |
31,257 | 35,357 | (4,100 | ) | (12 |
)% |
31,187 | |||||||||||||
|
|
||||||||||||||||||||
|
Loans, net of deferred fees and costs |
811,640 | 725,228 | 86,412 | 12 |
% |
805,535 | ||||||||||||||
|
Allowance for loan and lease losses |
(11,641 | ) | (11,495 | ) | (146 | ) | 1 |
% |
(11,544 | ) | ||||||||||
|
Net loans |
799,999 | 713,733 | 86,266 | 12 |
% |
793,991 | ||||||||||||||
|
|
||||||||||||||||||||
|
Premises and equipment, net |
15,903 | 15,494 | 409 | 3 |
% |
16,226 | ||||||||||||||
|
Other real estate owned |
814 | 1,011 | (197 | ) | (19 |
)% |
759 | |||||||||||||
|
Life insurance |
21,494 | 22,642 | (1,148 | ) | (5 |
)% |
23,098 | |||||||||||||
|
Deferred taxes |
9,363 | 8,389 | 974 | 12 |
% |
9,542 | ||||||||||||||
|
Goodwill and core deposit intangible, net |
2,196 | 2,469 | (273 | ) | (11 |
)% |
2,252 | |||||||||||||
|
Other assets |
19,132 | 17,987 | 1,145 | 6 |
% |
20,356 | ||||||||||||||
|
Total assets |
$ | 1,142,751 | $ | 1,077,083 | $ | 65,668 | 6 |
% |
$ | 1,140,992 | ||||||||||
|
|
||||||||||||||||||||
|
Liabilities and shareholders' equity: |
|
|||||||||||||||||||
|
Demand - noninterest bearing |
$ | 270,412 | $ | 212,758 | $ | 57,654 | 27 |
% |
$ | 270,398 | ||||||||||
|
Demand - interest bearing |
407,784 | 392,325 | 15,459 | 4 |
% |
405,569 | ||||||||||||||
|
Savings |
112,738 | 105,828 | 6,910 | 7 |
% |
113,309 | ||||||||||||||
|
Certificates of deposit |
213,556 | 226,756 | (13,200 | ) | (6 |
)% |
215,390 | |||||||||||||
|
Total deposits |
1,004,490 | 937,667 | 66,823 | 7 |
% |
1,004,666 | ||||||||||||||
|
|
||||||||||||||||||||
|
Term debt |
18,667 | 19,839 | (1,172 | ) | (6 |
)% |
18,917 | |||||||||||||
|
Unamortized debt issuance costs |
(173 | ) | (213 | ) | 40 | (19 |
)% |
(184 | ) | |||||||||||
|
Net term debt |
18,494 | 19,626 | (1,132 | ) | (6 |
)% |
18,733 | |||||||||||||
|
|
||||||||||||||||||||
|
Junior subordinated debentures |
10,310 | 10,310 | — | 0 |
% |
10,310 | ||||||||||||||
|
Other liabilities |
12,994 | 18,762 | (5,768 | ) | (31 |
)% |
13,177 | |||||||||||||
|
Total liabilities |
1,046,288 | 986,365 | 59,923 | 6 |
% |
1,046,886 | ||||||||||||||
|
|
||||||||||||||||||||
|
Shareholders' equity: |
|
|||||||||||||||||||
|
Common stock |
24,800 | 24,325 | 475 | 2 |
% |
24,547 | ||||||||||||||
|
Retained earnings |
72,066 | 65,201 | 6,865 | 11 |
% |
70,218 | ||||||||||||||
|
Accumulated other comprehensive (loss) income, net of tax |
(403 | ) | 1,192 | (1,595 | ) | (134 |
)% |
(659 | ) | |||||||||||
|
Total shareholders' equity |
96,463 | 90,718 | 5,745 | 6 |
% |
94,106 | ||||||||||||||
|
|
||||||||||||||||||||
|
Total liabilities and shareholders' equity |
$ | 1,142,751 | $ | 1,077,083 | $ | 65,668 | 6 |
% |
$ | 1,140,992 | ||||||||||
|
|
||||||||||||||||||||
|
Total interest earning assets |
$ | 1,068,066 | $ | 1,002,492 | $ | 65,574 | 7 |
% |
$ | 1,065,228 | ||||||||||
|
Shares outstanding |
13,517 | 13,442 |
|
13,440 | ||||||||||||||||
|
Tangible book value per share |
$ | 6.97 | $ | 6.57 |
|
$ | 6.83 | |||||||||||||
|
|
(NASDAQ: BOCH) |
TABLE 12
UNAUDITED
INCOME STATEMENT
(amounts in thousands, except per share data)
|
For The Three Months Ended |
||||||||||||||||||||
|
March 31, |
Change |
December 31, |
||||||||||||||||||
|
2017 |
2016 |
$ |
% |
2016 |
||||||||||||||||
|
Interest income: |
||||||||||||||||||||
|
Interest and fees on loans |
$ | 9,384 | $ | 8,451 | $ | 933 | 11 |
% |
$ | 9,181 | ||||||||||
|
Interest on securities |
789 | 784 | 5 | 1 |
% |
705 | ||||||||||||||
|
Interest on tax-exempt securities |
530 | 594 | (64 | ) | (11 |
)% |
522 | |||||||||||||
|
Interest on deposits in other banks |
114 | 75 | 39 | 52 |
% |
110 | ||||||||||||||
|
Total interest income |
10,817 | 9,904 | 913 | 9 |
% |
10,518 | ||||||||||||||
|
Interest expense: |
|
|||||||||||||||||||
|
Interest on demand deposits |
148 | 122 | 26 | 21 |
% |
135 | ||||||||||||||
|
Interest on savings deposits |
47 | 45 | 2 | 4 |
% |
45 | ||||||||||||||
|
Interest on certificates of deposit |
529 | 597 | (68 | ) | (11 |
)% |
543 | |||||||||||||
|
Interest on term debt |
293 | 782 | (489 | ) | (63 |
)% |
298 | |||||||||||||
|
Interest on other borrowings |
66 | 54 | 12 | 22 |
% |
63 | ||||||||||||||
|
Total interest expense |
1,083 | 1,600 | (517 | ) | (32 |
)% |
1,084 | |||||||||||||
|
Net interest income |
9,734 | 8,304 | 1,430 | 17 |
% |
9,434 | ||||||||||||||
|
Provision for loan and lease losses |
200 | — | 200 | 100 |
% |
— | ||||||||||||||
|
Net interest income after provision for loan and lease losses |
9,534 | 8,304 | 1,230 | 15 |
% |
9,434 | ||||||||||||||
|
Noninterest income: |
|
|||||||||||||||||||
|
Service charges on deposit accounts |
127 | 72 | 55 | 76 |
% |
120 | ||||||||||||||
|
ATM and point of sale |
266 | 92 | 174 | 189 |
% |
281 | ||||||||||||||
|
Payroll and benefit processing fees |
191 | 160 | 31 | 19 |
% |
161 | ||||||||||||||
|
Life insurance |
646 | 156 | 490 | 314 |
% |
152 | ||||||||||||||
|
Gain on investment securities, net |
66 | 94 | (28 | ) | (30 |
)% |
52 | |||||||||||||
|
Federal Home Loan Bank of San Francisco dividends |
103 | 90 | 13 | 14 |
% |
353 | ||||||||||||||
|
Other income |
143 | 285 | (142 | ) | (50 |
)% |
131 | |||||||||||||
|
Total noninterest income |
1,542 | 949 | 593 | 62 |
% |
1,250 | ||||||||||||||
|
|
(NASDAQ: BOCH) |
TABLE 12 - CONTINUED
UNAUDITED
INCOME STATEMENT
(amounts in thousands, except per share data)
|
For The Three Months Ended |
||||||||||||||||||||
|
March 31, |
Change |
December 31, |
||||||||||||||||||
|
2017 |
2016 |
$ |
% |
2016 |
||||||||||||||||
|
Noninterest expense: |
||||||||||||||||||||
|
Salaries and related benefits |
4,858 | 4,229 | 629 | 15 |
% |
4,237 | ||||||||||||||
|
Occupancy and equipment |
1,048 | 789 | 259 | 33 |
% |
1,022 | ||||||||||||||
|
Federal Deposit Insurance Corporation insurance premium |
48 | 156 | (108 | ) | (69 |
)% |
102 | |||||||||||||
|
Data processing fees |
407 | 304 | 103 | 34 |
% |
533 | ||||||||||||||
|
Professional service fees |
393 | 436 | (43 | ) | (10 |
)% |
481 | |||||||||||||
|
Telecommunications |
211 | 147 | 64 | 44 |
% |
206 | ||||||||||||||
|
Branch acquisition costs |
— | 412 | (412 | ) | (100 |
)% |
— | |||||||||||||
|
Loss on cancellation of interest rate swap |
— | 2,325 | (2,325 | ) | (100 |
)% |
— | |||||||||||||
|
Other expenses |
1,096 | 1,203 | (107 | ) | (9 |
)% |
1,234 | |||||||||||||
|
Total noninterest expense |
8,061 | 10,001 | (1,940 | ) | (19 |
)% |
7,815 | |||||||||||||
|
Income (loss) before provision for income (loss) taxes |
3,015 | (748 | ) | 3,763 | (503 |
)% |
2,869 | |||||||||||||
|
Deferred tax asset write-off |
— | 363 | (363 | ) | (100 |
)% |
— | |||||||||||||
|
Provision (benefit) for income taxes |
763 | (151 | ) | 914 | (605 |
)% |
572 | |||||||||||||
|
Net income (loss) |
$ | 2,252 | $ | (960 | ) | $ | 3,212 | (335 |
)% |
$ | 2,297 | |||||||||
|
Basic earnings (loss) per share |
$ | 0.17 | $ | (0.07 | ) | $ | 0.24 | (343 |
)% |
$ | 0.17 | |||||||||
|
Average basic shares |
13,416 | 13,360 | 56 | — |
% |
13,370 | ||||||||||||||
|
Diluted earnings (loss) per share |
$ | 0.17 | $ | (0.07 | ) | $ | 0.24 | (343 |
)% |
$ | 0.17 | |||||||||
|
Average diluted shares |
13,521 | 13,403 | 118 | 1 |
% |
13,476 | ||||||||||||||
|
|
(NASDAQ: BOCH) |
TABLE 13
UNAUDITED CONDENSED CONSOLIDATED
YEAR TO DATE AVERAGE BALANCE SHEETS
(amounts in thousands)
|
For the Three Months Ended |
For the Twelve Months Ended |
|||||||||||||||||||
|
March 31, |
March 31, |
December 31, |
December 31, |
December 31, |
||||||||||||||||
|
2017 |
2016 |
2016 |
2015 |
2014 |
||||||||||||||||
|
Earning assets: |
||||||||||||||||||||
|
Loans |
$ | 806,793 | $ | 720,795 | $ | 752,938 | $ | 699,227 | $ | 625,166 | ||||||||||
|
Taxable securities |
137,582 | 119,917 | 120,884 | 120,897 | 147,916 | |||||||||||||||
|
Tax exempt securities |
73,524 | 77,852 | 75,303 | 77,089 | 83,973 | |||||||||||||||
|
Interest-bearing deposits in other banks |
57,140 | 51,254 | 58,668 | 30,323 | 56,465 | |||||||||||||||
|
Average earning assets |
1,075,039 | 969,818 | 1,007,793 | 927,536 | 913,520 | |||||||||||||||
|
Cash and due from banks |
16,873 | 12,301 | 15,831 | 11,220 | 11,246 | |||||||||||||||
|
Premises and equipment, net |
16,165 | 12,384 | 15,078 | 11,552 | 12,105 | |||||||||||||||
|
Other assets |
40,228 | 39,700 | 41,048 | 42,423 | 36,936 | |||||||||||||||
|
Average total assets |
$ | 1,148,305 | $ | 1,034,203 | $ | 1,079,750 | $ | 992,731 | $ | 973,807 | ||||||||||
|
Liabilities and shareholders' equity: |
||||||||||||||||||||
|
Demand - noninterest bearing |
$ | 262,881 | $ | 182,539 | $ | 226,368 | $ | 156,578 | $ | 139,792 | ||||||||||
|
Demand - interest bearing |
420,416 | 323,771 | 374,170 | 283,105 | 272,383 | |||||||||||||||
|
Savings |
113,647 | 96,027 | 104,771 | 92,659 | 91,108 | |||||||||||||||
|
Certificates of deposit |
215,202 | 221,836 | 221,074 | 238,626 | 259,445 | |||||||||||||||
|
Total deposits |
1,012,146 | 824,173 | 926,383 | 770,968 | 762,728 | |||||||||||||||
|
Term debt |
18,598 | 91,444 | 37,286 | 88,874 | 77,534 | |||||||||||||||
|
Junior subordinated debentures |
10,310 | 10,310 | 10,310 | 10,310 | 15,239 | |||||||||||||||
|
Other liabilities |
12,431 | 16,969 | 13,217 | 16,588 | 15,934 | |||||||||||||||
|
Average total liabilities |
1,053,485 | 942,896 | 987,196 | 886,740 | 871,435 | |||||||||||||||
|
Shareholders' equity |
94,820 | 91,307 | 92,554 | 105,991 | 102,372 | |||||||||||||||
|
Average liabilities & shareholders' equity |
$ | 1,148,305 | $ | 1,034,203 | $ | 1,079,750 | $ | 992,731 | $ | 973,807 | ||||||||||
|
|
(NASDAQ: BOCH) |
TABLE 14
UNAUDITED CONDENSED CONSOLIDATED
QUARTERLY AVERAGE BALANCE SHEETS
(amounts in thousands)
|
For The Three Months Ended |
||||||||||||||||||||
|
March 31, |
December 31, |
September 30, |
June 30, |
March 31, |
||||||||||||||||
|
2017 |
2016 |
2016 |
2016 |
2016 |
||||||||||||||||
|
Earning assets: |
||||||||||||||||||||
|
Loans |
$ | 806,793 | $ | 778,458 | $ | 769,354 | $ | 742,684 | $ | 720,795 | ||||||||||
|
Taxable securities |
137,582 | 124,881 | 114,578 | 124,183 | 119,917 | |||||||||||||||
|
Tax exempt securities |
73,524 | 72,288 | 73,952 | 77,168 | 77,852 | |||||||||||||||
|
Interest-bearing deposits in other banks |
57,140 | 75,760 | 61,346 | 46,097 | 51,254 | |||||||||||||||
|
Average earning assets |
1,075,039 | 1,051,387 | 1,019,230 | 990,132 | 969,818 | |||||||||||||||
|
Cash and due from banks |
16,873 | 16,953 | 17,018 | 17,028 | 12,301 | |||||||||||||||
|
Premises and equipment, net |
16,165 | 16,331 | 15,941 | 15,632 | 12,384 | |||||||||||||||
|
Other assets |
40,228 | 41,363 | 41,729 | 41,394 | 39,700 | |||||||||||||||
|
Average total assets |
$ | 1,148,305 | $ | 1,126,034 | $ | 1,093,918 | $ | 1,064,186 | $ | 1,034,203 | ||||||||||
|
Liabilities and shareholders' equity: |
||||||||||||||||||||
|
Demand - noninterest bearing |
$ | 262,881 | $ | 261,600 | $ | 240,418 | $ | 220,377 | $ | 182,539 | ||||||||||
|
Demand - interest bearing |
420,416 | 398,749 | 390,895 | 382,811 | 323,771 | |||||||||||||||
|
Savings |
113,647 | 111,755 | 107,210 | 103,990 | 96,027 | |||||||||||||||
|
Certificates of deposit |
215,202 | 217,463 | 221,078 | 223,958 | 221,836 | |||||||||||||||
|
Total deposits |
1,012,146 | 989,567 | 959,601 | 931,136 | 824,173 | |||||||||||||||
|
Term debt |
18,598 | 18,975 | 19,610 | 19,510 | 91,444 | |||||||||||||||
|
Junior subordinated debentures |
10,310 | 10,310 | 10,310 | 10,310 | 10,310 | |||||||||||||||
|
Other liabilities |
12,431 | 12,856 | 11,159 | 11,913 | 16,969 | |||||||||||||||
|
Average total liabilities |
1,053,485 | 1,031,708 | 1,000,680 | 972,869 | 942,896 | |||||||||||||||
|
Shareholders' equity |
94,820 | 94,326 | 93,238 | 91,317 | 91,307 | |||||||||||||||
|
Average liabilities & shareholders' equity |
$ | 1,148,305 | $ | 1,126,034 | $ | 1,093,918 | $ | 1,064,186 | $ | 1,034,203 | ||||||||||
|
|
(NASDAQ: BOCH) |
About Bank of Commerce Holdings
Bank of Commerce Holdings is a bank holding company headquartered in Redding, California and is the parent company for Redding Bank of Commerce which operates under two separate names (Redding Bank of Commerce and Sacramento Bank of Commerce, a division of Redding Bank of Commerce). The Bank is an FDIC-insured California banking corporation providing community banking and financial services through nine offices located in northern California. The Bank opened on October 22, 1982. The Company’s common stock is listed on the NASDAQ Global Market and trades under the symbol “BOCH”.
Contact Information:
Randall S. Eslick, President and Chief Executive Officer
Telephone Direct (530) 722-3900
Samuel D. Jimenez, Executive Vice President and Chief Operating Officer
Telephone Direct (530) 722-3952
James A. Sundquist, Executive Vice President and Chief Financial Officer
Telephone Direct (530) 722-3908
Andrea Schneck, Vice President and Senior Administrative Officer
Telephone Direct (530) 722-3959
20