CBOA Financial, Inc. Reports 3Q 2021 Consolidated Earnings of $ 510,000 | New

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TUCSON, Arizona., November 1, 2021 / PRNewswire / – CBOA Financial, Inc. (OTCMKTS: CBOF) (the “Company”), parent company of Commerce Bank of Arizona (the “Bank” or “CBAZ”), announced that the consolidated net profit after tax for the quarter ended September 30, 2021 increased by 12% for $ 510,000, of $ 457,000 in the third quarter of last year.

Chris Webster, the President and Chief Executive Officer of the Bank said: “It is significant that we were able to add $ 29 million in organic loan financings during the third quarter. He added, “Many banks have struggled to generate significant loan growth this year. Webster also said, “We remain diligent on pricing new loans. This pricing strategy demonstrates our ability to achieve a net interest margin that is among the best performing banks in our peer group. With respect to credit quality, the Company’s loan portfolio is performing as expected. Webster added, “We are keeping a close eye on some real business assets. real estate segments such as linear shopping malls and other submarkets where the pandemic has potentially impacted tenants. In addition, due to aggressive loan management practices, we are pleased to report that our traditional classified loans fell below 0.50% of assets for the first time since 2006. On top of that, the levels of reserves remain healthy at 1.33%. “

Highlights for the third quarter of 2021

  • $ 29 million new loans financed during the quarter
  • Pre-tax profit to date increased 104% to $ 2,499 million compared to a year ago
  • Non-performing assets fell 29% for the quarter

Operational highlights

Interest income during the quarter was supported by fee income recognized from PPP loans which supported earnings in $ 384,000, as well as a recovery of interest income on a classified asset which added $ 260,000. He stays $ 400,000 in PPP origination fee income which will likely be accrued in the coming quarters as the remaining loans are canceled. Another contribution to the growth of net interest income was $ 47,000 lower interest charges.

The Bank continues to make progress on its former classified assets. Year-over-year, non-performing assets which include loans and OREOs are down 67% from $ 4.4 million or 1.3% of assets $ 1.4 million or 0.41% of the assets.

Balance sheet

Total assets increased by 1% to reach $ 340.4 million during the quarter ended September 30, 2021 and increased by 2.6% compared to $ 331.6 million one year ago. Total asset growth of September 2020 To September 2021 consisted of growth in liquidity and net deposits which was supported by PPP loans.

Traditional gross loans have declined $ 500 million since the second quarter 2021 ending the third quarter 2021 in $ 216 million. The slight net decrease is due to the cancellation of PPP loans during the quarter of $ 14 million. Total gross loans decreased by 5.7% to $ 237 million during the quarter and decreased by 5% compared to $ 250 million one year ago. Total deposits increased by 0.9% for $ 303 million during the quarter and increased 8.5% from $ 279 million one year ago.

The allowance for loan losses is $ 3.16 million To September 30, 2021, or 1.46% of “traditional” non-PPP loans, against 1.46% in the previous quarter, and was 1.33% for the quarter with PPP loans included. During the quarter, the Bank recorded only one full loan write-off of $ 207,000. The economic effects of the pandemic were not a factor in the specific borrower’s situation that led to the write-off, and management believes the portfolio’s credit quality remains excellent.

The Bank has registered a $ 384,000 adjustment that reduced its deferred tax asset and increased the tax provision charge during the quarter to adjust the account after the total valuation allowance was canceled in 2020. For the year, the provision charge d net tax is $ 152,000. The Bank does not anticipate any further significant adjustments to this account in the near future.

Equity brought to $ 28 million To September 30, 2021, of the previous quarter. TO September 30, 2021, the tangible book value was $ 2.96 per share compared to $ 2.86 per share at June 30, 2021 and $ 2.81 per share a year ago. The banks September 30, 2021 The Tier 1 leverage ratio was 9.45%, compared to 8.80% at September 30, 2020. Excluding PPP loans, the Bank September 30, 2021 The Tier 1 leverage ratio would have been 10.1%, and 10.6% as of September 30, 2020.

Capital management

Capital ratios exceeded regulatory guidelines for a well-capitalized institution under Basel III requirements and the Dodd Frank Wall Street reform at September 30, 2021. The capital ratios are presented below.

About the company

Commerce Bank of Arizona, established in 2002 in Tucson, Arizona, is a full-service community bank for small and medium-sized businesses and real estate professionals. CBAZ offers its business clients a variety of services ranging from US Small Business Administration (SBA) financing solutions to construction loans and commercial real estate loans. CBOA Financial, Inc. is a sole banking holding company and the parent company of the Bank. The Company is traded over-the-counter under the name CBOF. For more information visit: www.commercebankaz.com.

Forward-looking statements

This press release may include forward-looking statements about CBOA Financial, Inc. or Commerce Bank of Arizona. These statements involve certain risks and uncertainties which could cause actual results to differ materially from those of forward-looking statements. These risks and uncertainties include, but are not limited to, the following factors: competition, fluctuations in interest rates, dependence on key individuals, payment defaults, geographic concentration, litigation and changes in federal laws, regulations and interpretations. All forward-looking statements included in this press release are based on information available at the time of publication, and CBOA Financial, Inc. and Commerce Bank of Arizona assume no obligation to update any forward-looking statement.

Contact:

Chris Webster

President and CEO

480-253-4511

[email protected]

Unaudited consolidated summary financial information

Dollars in thousands – Unaudited

For the quarter ended

Year to date

09/30/2021

06/30/2021

09/30/2020

09/30/2021

09/30/2020

Income summary data

Interest income

3 884

3 299

3 202

10 670

9,577

Interest charges

174

221

356

674

1 168

Net interest income

3,710

3,078

2,846

9,996

8,409

Provision for (reduction of) loan losses

146

193

339

(279)

Income other than interest

74

84

(49)

228

(501)

Gains (losses) realized on sales of securities

2

2

168

Non-interest charges

2 424

2,440

2340

7 388

7,132

Profit (loss) before taxes

1214

529

457

2 499

1 223

Provision for income tax

704

(764)

152

Net revenue

510

1,293

457

2 347

1 223

Data by share

Shares outstanding at the end of the period

8 911

8,550

8 208

8 911

8 208

Earnings per common share (in $)

0.06

0.15

0.06

0.26

0.15

Earnings per common share (diluted) (in $)

0.05

0.14

0.04

0.25

0.12

Declared cash dividend

Total equity

28 233

27,033

23,589

28 233

23,589

Tangible book value per share (in $)

2.96

2.86

2.87

2.96

2.87

Selected balance sheet data

Total assets

340,373

336,551

331,636

340,373

331,636

Titles available for sale

44 356

42 831

36,636

44 356

36,636

Loans

237 234

251,449

249,684

237 234

249,684

Allowance for loan losses

3 160

3 170

2 996

3 160

2 996

Deposits

302,994

300 366

279,187

302,994

279,187

Other loans

21,574

21,574

Equity

28 233

27,033

23,589

28 233

23,589

Performance ratios (%)

Return on average equity

(annualized)

9.20

12.53

7.10

9.20

7.10

Net interest margin

4.01

3.63

4.03

4.01

4.03

Efficiency ratio

71.06

76.11

82.45

71.06

82.45

Data on asset quality (%)

Non-performing assets in relation to total assets

0.40

0.57

1.30

0.40

1.30

Reserve for loan losses in total loans

1.33

1.26

1.20

1.33

1.20

Write-offs on average loans for the period

0.1

(0.02)

(0.0)

0.1

(0.0)

Regulatory capital ratios (%)

Ordinary Tier 1 capital

12.90

11.96

12.95

12.90

12.95

Tier 1 risk-based capital ratio

12.90

11.96

12.95

12.90

12.95

Total risk-based capital ratio

14.12

13.21

14.20

14.12

14.20

Tier 1 leverage ratio

9.45

8.43

8.80

9.45

8.80

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SOURCE Commercial Bank of Arizona


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