Cornerstone Community Bancorp Reports Financial Results for the First Quarter Ended March 31, 2018

RED BLUFF, Calif.--()--Cornerstone Community Bancorp (OTC Pink: CRSB) announced today its financial results for the first quarter ended March 31, 2018.

The Company reported net income of $562,000 for the three months ended March 31, 2018 compared to net income of $390,000 for the same period last year. Diluted earnings per share were $0.39 for the three months ended March 31, 2018 compared to $0.29 for the same period last year.

The return on average assets for the three months ended March 31, 2018 was 0.96% and the return on average equity was 12.26%.

President and CEO, Jeff Finck, stated, “2018 is off to an excellent start with double-digit growth in loans, deposits and earnings. Credit quality remains pristine with no nonperforming assets at quarter-end.”

Net Interest Income

Net interest income increased by 25% to $2,228,000 for the quarter ended March 31, 2018 compared to $1,783,000 for the same quarter last year.

Provision for credit losses

The Company recorded a $64,000 provision for credit losses for the quarter ended March 31, 2018 compared to $150,000 for the same period last year.

Non-Interest Income

Non-interest income for the quarter ended March 31, 2018 was $161,000 compared to $375,000 for the quarter ended March 31, 2017.

Non-Interest Expense

Non-interest expense was $1,578,000 for the quarter ended March 31, 2018 compared to $1,344,000 for the same period last year.

Balance Sheet

The Company had total assets at March 31, 2018 of $240.7 million compared to $200.0 million at March 31, 2017.

Total loans, net of unearned income at March 31, 2018 were $188.9 million compared to $159.8 million at March 31, 2017, representing an increase of $29.1 million, or 18.2%.

Total deposits were $207.6 million at March 31, 2018 compared to total deposits of $166.0 million at March 31, 2017, representing an increase of $41.6 million, or 25.0%.

Credit Quality

The allowance for loan losses was $1,907,000, or 1.01% of loans, net of unearned income at March 31, 2018, compared to $1,773,000, or 1.11% of loans, net of unearned income at March 31, 2017. There were no nonperforming assets at March 31, 2018 compared to $8,000 at March 31, 2017.

Capital

At March 31, 2018, shareholders’ equity totaled $18.3 million compared to $16.2 million at March 31, 2017. Book value per share increased by 8.7% to $14.22 per share at March 31, 2018 compared to $13.08 per share at March 31, 2017.

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 two banking offices 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)
 
 
 
03/31/18     12/31/17     09/30/17     06/30/17     03/31/17
 
ASSETS
Cash and due from banks $ 3,364 $ 4,630 $ 4,465 $ 3,516 $ 3,809
Federal funds sold 20 20 20 20 20
Interest-bearing deposits 24,932 17,077 24,930 13,739 16,773
Investment securities 10,942 12,274 12,486 12,793 13,052
Loans held for sale 1,849 - - 2,603 -
Loans, net of unearned income 188,883 184,814 173,452 169,070 159,768
Allowance for loan losses   (1,907 )       (1,847 )       (1,847 )       (1,778 )       (1,773 )
Loans, net 186,976 182,967 171,605 167,292 157,995
Premises and equipment, net 5,846 5,121 3,102 2,006 1,854
Other assets   6,753         6,950         7,001         8,605         6,460  
Total assets $ 240,682       $ 229,039       $ 223,609       $ 210,574       $ 199,963  
 
LIABILITIES
Deposits:
Demand noninterest-bearing $ 42,223 $ 38,348 $ 37,977 $ 33,101 $ 27,439
Demand interest-bearing 27,514 26,311 25,434 24,610 23,392
Money market and savings 73,936 68,715 65,909 59,759 60,877
Time deposits of less than $100,000 17,959 18,510 18,333 19,020 18,984
Time deposits of $100,000 or more   45,933         44,731         43,658         42,565         35,317  
Total deposits 207,565 196,615 191,311 179,055 166,009
Federal Home Loan Bank borrowings 9,000 9,000 9,000 9,000 12,000
Subordinated debentures 4,895 4,892 4,890 4,887 4,885
Interest payable and other liabilities   933         821         955         868         865  
Total liabilities   222,393         211,328         206,156         193,810         183,759  
 
SHAREHOLDERS' EQUITY
Common stock 13,429 13,333 13,258 13,115 13,092
Retained Earnings 4,843 4,282 4,113 3,557 3,050
Accumulated other comprehensive income (loss)   17         96         82         92         62  
Total shareholders' equity   18,289         17,711         17,453         16,764         16,204  
Total liabilities and shareholders' equity $ 240,682       $ 229,039       $ 223,609       $ 210,574       $ 199,963  
 
Total equity / total assets 7.60 % 7.73 % 7.81 % 7.96 % 8.10 %
Book value per share $ 14.22 $ 13.99 $ 13.90 $ 13.53 $ 13.08
 
 
CORNERSTONE COMMUNITY BANCORP
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(Dollars in Thousands)
           
 
 
 
Three months ended
03/31/18     12/31/17     03/31/17
 
INTEREST INCOME
Loans $ 2,531 $ 2,495 $ 1,999
Federal funds sold - - -
Investment securities 78 78 81
Other   88         98         65  
Total interest income   2,697         2,671         2,145  
 
INTEREST EXPENSE
Deposits:
Interest-bearing demand 14 13 11
Money market and savings 127 120 94
Time deposits 203 185 126
Other   125         127         131  
Total interest expense   469         445         362  
 
Net interest income 2,228 2,226 1,783
Provision for credit losses   64         -         150  

Net interest income after provision for credit losses

  2,164         2,226         1,633  
 
NON-INTEREST INCOME
Service charges on deposit accounts 49 47 44
Gain on sale of loans 17 102 243
Gain (loss) on sale of other real estate owned - - -
Gain (loss) on sale of securities - - -
Other non-interest income   95         94         88  
Total non-interest income   161         243         375  
 
OPERATING EXPENSES
Salaries and benefits 876 799 737
Premises and fixed assets 150 143 144
Other   552         535         463  
Total operating expenses   1,578         1,477         1,344  
 
Income before income taxes 747 992 664
Income taxes 185 808 274
             
NET INCOME $ 562       $ 184       $ 390  
 
EARNINGS PER SHARE
Basic earnings per share $ 0.44       $ 0.15       $ 0.32  
Diluted earnings per share $ 0.39       $ 0.13       $ 0.29  
Average common shares outstanding   1,276,923         1,261,647         1,233,978  

Average common and equivalent shares outstanding

  1,424,197         1,382,565         1,338,511  
 
PERFORMANCE MEASURES
Return on average assets 0.96 % 0.32 % 0.78 %
Return on average equity 12.26 % 4.11 % 9.68 %
Net interest margin 4.10 % 4.09 % 3.78 %
Efficiency ratio 66.05 % 59.82 % 62.28 %

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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