Cornerstone Community Bancorp Reports Financial Results for the First Quarter Ended March 31, 2017

RED BLUFF, Calif.--()--Cornerstone Community Bancorp (OTC Pink: CRSB) announced today its financial results for the first quarter ended March 31, 2017.

The Company reported net income of $390,000 for the three months ended March 31, 2017 compared to net income of $203,000 for the same period last year. Diluted earnings per share were $0.29 for the three months ended March 31, 2017 compared to $0.15 for the same period last year.

The return on average assets for the three months ended March 31, 2017 was 0.78% and the return on average equity was 9.68%.

President and CEO, Jeff Finck, stated, “The Company is off to a great start in 2017. Both loans and deposits showed solid growth. We look forward to opening a new downtown Redding branch office this summer to allow for the continued growth of the Company.”

Net Interest Income

Net interest income was $1,783,000 for the quarter ended March 31, 2017 compared to $1,538,000 for the same quarter last year.

Provision for credit losses

The Company recorded a $150,000 provision for credit losses for the quarter ended March 31, 2017 compared to no provision for the same quarter last year. The provision was recorded due to continued growth in the loan portfolio.

Non-Interest Income

Non-interest income for the quarter ended March 31, 2017 was $375,000 compared to $115,000 for the quarter ended March 31, 2016.

Non-Interest Expense

Non-interest expense was $1,344,000 for the quarter ended March 31, 2017 compared to $1,309,000 for the same period last year.

Balance Sheet

The Company had total assets at March 31, 2017 of $200.0 million compared to $180.8 million at March 31, 2016.

Total loans outstanding at March 31, 2017 were $159.8 million compared to $139.7 million at March 31, 2016, representing an increase of $20.1 million, or 14.4%.

Total deposits were $166.0 million at March 31, 2017 compared to total deposits of $145.3 million at March 31, 2016, representing an increase of $20.7 million, or 14.2%.

Credit Quality

The allowance for loan losses was $1,773,000, or 1.11% of loans, net of unearned income at March 31, 2017, compared to $1,620,000, or 1.16% of loans, net of unearned income at March 31, 2016. Nonperforming assets at March 31, 2017 were $8,000 compared to $373,000 at March 31, 2016.

Capital

At March 31, 2017, shareholders’ equity totaled $16.2 million compared to $14.9 million at March 31, 2016. Book value per share increased by 9.8% to $13.08 per share at March 31, 2017 compared to $11.91 per share at March 31, 2016.

About Cornerstone Community Bancorp

Cornerstone Community Bancorp, a bank holding company headquartered in Red Bluff, California, serves the Red Bluff and Redding communities through its wholly-owned subsidiary, Cornerstone Community Bank with a headquarters office in Red Bluff and a banking office in Redding. The Bank provides commercial banking services to small and mid-size businesses, including professional service firms, real estate developers and investors and not-for-profit organizations and to their owners and other individuals. Additional information about the Bank is available on its website at www.bankcornerstone.com.

Forward-Looking Statements

This press release contains forward-looking statements. These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of the management of Cornerstone Community Bancorp and on information available to management at the time these statements were made. There are a number of factors, many of which are beyond Cornerstone Community Bancorp’s control, which could cause actual conditions, events or results to differ significantly from those described in the forward-looking statements. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, among others, the following possibilities: (1) competitive pressures among depository and other financial institutions may increase significantly; (2) revenues may be lower than expected; (3) changes in the interest rate environment may reduce interest margins; (4) general economic conditions, either nationally or regionally, may be less favorable than expected, resulting in, among other things, a deterioration in credit quality and/or a reduced demand for credit; (5) legislative or regulatory changes, including changes in accounting standards and tax laws, may adversely affect the businesses in which Cornerstone Community Bancorp is engaged; (6) competitors may have greater financial resources and develop products that enable such competitors to compete more successfully than Cornerstone Community Bancorp; and (7) adverse changes may occur in the securities markets or with respect to inflation. Forward-looking statements speak only as of the date they are made. Except as required by law, Cornerstone Community Bancorp does not undertake to update forward-looking statements to reflect subsequent circumstances or events.

 
CORNERSTONE COMMUNITY BANCORP
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(Dollars in Thousands)
 
 
    03/31/17       12/31/16       09/30/16       06/30/16       03/31/16  
       
ASSETS
Cash and due from banks $ 3,809 $ 3,360 $ 2,937 $ 2,630 $ 3,007
Federal funds sold 20 20 20 20 20
Interest-bearing deposits 16,773 17,225 25,372 10,370 18,009
Investment securities 13,052 13,338 14,003 14,453 14,645
Loans held for sale - 3,974 - - -
Loans, net of unearned income 159,768 150,413 147,477 145,939 139,660
Allowance for loan losses   (1,773 )     (1,623 )     (1,621 )     (1,620 )     (1,620 )
Loans, net 157,995 148,790 145,856 144,319 138,040
Premises and equipment, net 1,854 1,032 1,086 1,038 1,051
Other assets   6,460       6,643       6,269       5,659       6,029  
Total assets $ 199,963     $ 194,382     $ 195,543     $ 178,489     $ 180,801  
 
LIABILITIES
Deposits:
Demand noninterest-bearing $ 27,439 $ 23,042 $ 27,460 $ 24,856 $ 23,678
Demand interest-bearing 23,392 22,490 22,212 21,222 20,843
Money market and savings 60,877 62,161 65,426 52,239 53,240
Time deposits of less than $100,000 18,984 18,595 12,692 12,498 14,334
Time deposits of $100,000 or more   35,317       34,804       34,771       34,662       33,219  
Total deposits 166,009 161,092 162,561 145,477 145,314
Federal Home Loan Bank borrowings 12,000 12,000 12,000 12,000 15,000
Subordinated debentures 4,885 4,883 4,880 4,878 4,876
Interest payable and other liabilities   865       746       850       765       697  
Total liabilities   183,759       178,721       180,291       163,120       165,887  
 
SHAREHOLDERS' EQUITY
Common stock 13,092 12,925 12,847 13,303 13,280
Retained Earnings 3,050 2,659 2,202 1,871 1,510
Accumulated other comprehensive income (loss)   62       77       203       195       124  
Total shareholders' equity   16,204       15,661       15,252       15,369       14,914  
Total liabilities and shareholders' equity $ 199,963     $ 194,382     $ 195,543     $ 178,489     $ 180,801  
 
Total equity / total assets 8.10 % 8.06 % 7.80 % 8.61 % 8.25 %
Book value per share $ 13.08 $ 12.90 $ 12.67 $ 12.28 $ 11.91
 
CORNERSTONE COMMUNITY BANCORP
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(Dollars in Thousands)
 
 
  Three months ended
  03/31/17       12/31/16       03/31/16  
   
INTEREST INCOME
Loans $ 1,999 $ 2,002 $ 1,750
Federal funds sold - - -
Investment securities 81 79 75
Other   65       91       42  
Total interest income   2,145       2,172       1,867  
 
INTEREST EXPENSE
Deposits:
Interest-bearing demand 11 11 10
Money market and savings 94 92 69
Time deposits 126 117 115
Other   131       133       135  
Total interest expense   362       353       329  
 
Net interest income 1,783 1,819 1,538
Provision for credit losses   150       -       -  

Net interest income after provision for credit losses

  1,633       1,819       1,538  
 
NON-INTEREST INCOME
Service charges on deposit accounts 44 45 36
Gain on sale of loans 243 127 -
Gain (loss) on sale of other real estate owned - - -
Gain (loss) on sale of securities - - -
Other non-interest income   88       85       79  
Total non-interest income   375       257       115  
 
OPERATING EXPENSES
Salaries and benefits 737 730 702
Premises and fixed assets 144 137 141
Other   463       434       466  
Total operating expenses   1,344       1,301       1,309  
 
Income before income taxes 664 775 344
Income taxes 274 318 141
         
NET INCOME $ 390     $ 457     $ 203  
 
EARNINGS PER SHARE
Basic earnings per share $ 0.32     $ 0.38     $ 0.16  
Diluted earnings per share $ 0.29     $ 0.35     $ 0.15  
Average common shares outstanding   1,233,978       1,206,756       1,252,000  

 

Average common and equivalent shares outstanding

  1,338,511       1,304,164       1,345,145  
 
PERFORMANCE MEASURES
Return on average assets 0.78 % 0.94 % 0.46 %
Return on average equity 9.68 % 11.74 % 5.44 %
Net interest margin 3.78 % 3.85 % 3.65 %
Efficiency ratio 62.28 % 62.67 % 79.19 %

Contacts

Cornerstone Community Bancorp
Jeffrey P. Finck, 530-222-1460
President & CEO
Patrick E. Phelan, 530-222-1460
Chief Financial Officer

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