Toggle SGML Header (+)


Section 1: 8-K (8-K)

Document


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of Report: July 17, 2019
(Date of earliest event reported)

Central Valley Community Bancorp
(Exact name of registrant as specified in its charter)
 
CA
(State or other jurisdiction
of incorporation)
000-31977
(Commission File Number)
77-0539125
(IRS Employer
Identification Number)
 
7100 N. Financial Dr., Ste. 101, Fresno, CA
(Address of principal executive offices)
 
93720
(Zip Code)
559-298-1775
(Registrant’s telephone number, including area code)
 
Not Applicable
(Former Name or Former Address, if changed since last report)


Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act  o





Item 2.02. Results of Operations and Financial Condition

On July 17, 2019, Central Valley Community Bancorp issued a press release containing unaudited financial information and accompanying discussion for the quarter and year ended June 30, 2019. The press release is attached as Exhibit 99.1 to this Current Report on Form 8-K and incorporated herein by reference.

Item 8.01             Other Events
 
On July 17, 2019, the Board of Directors of Central Valley Community Bancorp declared a $0.11 per share cash dividend payable on August 16, 2019 to shareholders of record as of August 2, 2019. The Board of Directors of the Company also approved the adoption of a program to effect repurchases of the Company’s common stock. Under the program, the Company may repurchase up to $10 million of the Company’s outstanding shares of common stock, which represents approximately 3% of the Company’s outstanding shares of common stock, or approximately 479,616 shares based on the closing stock price of the Company’s common stock on July 16, 2019 of $20.85. The share repurchase program will begin on July 22, 2019 and end on July 17, 2020. The shares will be repurchased in open market transactions through brokers, subject to availability.

The information in this Form 8-K filed on July 17, 2019 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, regardless of any general incorporation language in such filing.

Item 9.01. Financial Statements and Exhibits

(a) Financial statements:
            None
(b) Pro forma financial information:
            None
(c) Shell company transactions:
            None
(d) Exhibits
            99.1       Press Release of Central Valley Community Bancorp dated July 17, 2019




SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Dated:
July 17, 2019
CENTRAL VALLEY COMMUNITY BANCORP

By:  /s/ David A. Kinross                   
      David A. Kinross
      Executive Vice President and Chief Financial Officer (Principal
      Accounting Officer)

Exhibit Index
Exhibit No.
Description
99.1
Press Release of Central Valley Community Bancorp dated
 
July 17, 2019




(Back To Top)

Section 2: EX-99.1 (EXHIBIT 99.1)

Exhibit

Central Valley Community Bancorp -- page 1


398776479_cvcbankcorplogoclra01a01a36.jpg
FOR IMMEDIATE RELEASE

CENTRAL VALLEY COMMUNITY BANCORP REPORTS EARNINGS RESULTS FOR THE SIX MONTHS AND QUARTER ENDED JUNE 30, 2019, QUARTERLY DIVIDEND, AND ANNOUNCES STOCK REPURCHASE PLAN

FRESNO, CALIFORNIA…July 17, 2019… The Board of Directors of Central Valley Community Bancorp (Company) (NASDAQ: CVCY), the parent company of Central Valley Community Bank (Bank), reported today unaudited consolidated net income of $11,303,000, and fully diluted earnings per common share of $0.83 for the six months ended June 30, 2019, compared to $10,256,000 and $0.74 per fully diluted common share for the six months ended June 30, 2018.
SECOND QUARTER FINANCIAL HIGHLIGHTS
Net loans increased $41.2 million or 4.53%, and total assets increased $75.4 million or 4.90% at June 30, 2019 compared to December 31, 2018.
Total deposits increased 0.92% to $1.29 billion at June 30, 2019 compared to December 31, 2018.
Total cost of deposits remains at low levels at 0.15% and 0.08% for the quarter ended June 30, 2019 and 2018, respectively.
Average non-interest bearing demand deposit accounts as a percentage of total average deposits was 42.45% and 40.85% for the quarters ended June 30, 2019 and 2018, respectively.
Capital positions remain strong at June 30, 2019 with a 11.43% Tier 1 Leverage Ratio; a 14.72% Common Equity Tier 1 Ratio; a 15.16% Tier 1 Risk-Based Capital Ratio; and a 16.00% Total Risk-Based Capital Ratio.
The Company declared a $0.11 per common share cash dividend, payable on August 16, 2019 to shareholders of record on August 2, 2019.
During the quarter ended June 30, 2019, the Company repurchased and retired a total of 223,121 shares of common stock at an average price paid per share of $19.94. Since the Company approved the stock repurchased program on July 18, 2018, the Company has repurchased and retired a total of 379,382 shares at an average price paid per share of $19.60.

- more -


Central Valley Community Bancorp -- page 2


The Company opened a new banking office in Gold River. The Company closed two banking offices - one in Rancho Cordova and one in Fair Oaks during the second quarter of 2019, and incurred approximately $51,000 in consolidation/closing costs during the quarter.
“This quarter we improved net income, grew loans and enhanced client relationships. With the addition of our new Market Executives in July, we expect this momentum to continue throughout our market area,” stated James M. Ford, President & CEO of Central Valley Community Bank and Central Valley Community Bancorp.  “Given our strong capital levels, the Board of Directors authorized a new stock repurchase program for an additional $10 million of common stock.”
Net income for the six months ended June 30, 2019 increased 10.21%, primarily driven by an increase in net interest income and an increase in net realized gains on sales and calls of investment securities, partially offset by an increase in non-interest expense and an increase in the provision for income taxes, compared to the six months ended June 30, 2018. During the six months ended June 30, 2019, the Company recorded a $275,000 provision for credit losses, compared to a $50,000 provision during the six months ended June 30, 2018. Net interest income before the provision for credit losses for the six months ended June 30, 2019 was $31,781,000, compared to $30,823,000 for the six months ended June 30, 2018, an increase of $958,000 or 3.11%. The impact to interest income from the accretion of the loan marks on acquired loans was $451,000 and $590,000 for the six months ended June 30, 2019 and 2018, respectively. In addition, net interest income before the provision for credit losses for the six months ended June 30, 2019 was benefited by approximately $183,000 in nonrecurring income from prepayment penalties and payoff of loans previously on nonaccrual status, as compared to a $175,000 in nonrecurring income for the six months ended June 30, 2018. Excluding these reversals and benefits, net interest income for the six months ended June 30, 2019 increased by $950,000 compared to the six months ended June 30, 2018.
During the six months ended June 30, 2019, the Company’s shareholders’ equity increased $11,942,000, or 5.43%, compared to December 31, 2018. The increase in shareholders’ equity was driven by the retention of earnings, net of dividends paid, and an increase in net unrealized gains on available-for-sale (AFS) securities recorded, net of estimated taxes, in accumulated other comprehensive income (AOCI).

- more -


Central Valley Community Bancorp -- page 3


Return on average equity (ROE) for the six months ended June 30, 2019 was 10.06%, compared to 9.84% for the six months ended June 30, 2018. The increase in ROE reflects increase in net income, notwithstanding an increase in shareholders’ equity. The Company declared and paid $0.21 and $0.14 per share in cash dividends to holders of common stock during the six months ended June 30, 2019 and 2018, respectively. Annualized return on average assets (ROA) was 1.45% for the six months ended June 30, 2019 and 1.28% for the six months ended June 30, 2018. During the six months ended June 30, 2019, the Company’s total assets increased 4.90%, and total liabilities increased 4.81%, compared to December 31, 2018.
Non-performing assets decreased by $298,000, or 10.88%, to $2,442,000 at June 30, 2019, compared to $2,740,000 at December 31, 2018. During the six months ended June 30, 2019, the Company recorded $26,000 in net loan recoveries, compared to $92,000 in net recoveries for the six months ended June 30, 2018. The net charge-off (recovery) ratio, which reflects annualized net recoveries to average loans, was (0.01)% for the six months ended June 30, 2019, compared to (0.02)% for the same period in 2018. Total non-performing assets were 0.15% and 0.18% of total assets as of June 30, 2019 and December 31, 2018, respectively.
At June 30, 2019, the allowance for credit losses was $9,405,000, compared to $9,104,000 at December 31, 2018, a net increase of $301,000 reflecting the net recoveries and provision during the period. The allowance for credit losses as a percentage of total loans was 0.98% and 0.99% as of June 30, 2019 and December 31, 2018, respectively. Total loans includes loans acquired in the acquisitions of Folsom Lake Bank on October 1, 2017, Sierra Vista Bank on October 1, 2016 and Visalia Community Bank on July 1, 2013 that, at their respective acquisition dates, were recorded at fair value and did not have a related allowance for credit losses. The recorded value of acquired loans totaled $168,792,000 at June 30, 2019 and $189,719,000 at December 31, 2018. Excluding these acquired loans from the calculation, the allowance for credit losses to total gross loans was 1.19% and 1.25% as of June 30, 2019 and December 31, 2018, respectively, and general reserves associated with non-impaired loans to total non-impaired loans was 1.18% and 1.25%, respectively. The Company believes the allowance for credit losses is adequate to provide for probable incurred credit losses within the loan portfolio at June 30, 2019.
The Company’s net interest margin (fully tax equivalent basis) was 4.56% for the six months ended June 30, 2019, compared to 4.33% for the six months ended June 30, 2018. The increase in net interest margin in

- more -


Central Valley Community Bancorp -- page 4


the period-to-period comparison resulted from the increase in the effective yield on interest earning deposits in other banks and Federal Funds sold, the increase in the effective yield on average investment securities, and the increase in the yield on the Company’s loan portfolio.
For the six months ended June 30, 2019, the effective yield on average total earning assets increased 32 basis points to 4.75% compared to 4.43% for the six months ended June 30, 2018, while the cost of average total interest-bearing liabilities increased to 0.34% for the six months ended June 30, 2019 as compared to 0.17% for the six months ended June 30, 2018. Over the same periods, the cost of average total deposits increased to 0.14% for the six months ended June 30, 2019 compared to 0.07% for the same period in 2018.
For the six months ended June 30, 2019, the Company’s average investment securities, including interest-earning deposits in other banks and Federal funds sold, totaled $496,076,000, a decrease of $58,933,000, or 10.62%, compared to the six months June 30, 2018. The effective yield on average investment securities, including interest earning deposits in other banks and Federal funds sold, increased to 3.15% for the six months ended June 30, 2019, compared to 2.72% for the six months ended June 30, 2018.
Total average loans (including nonaccrual), which generally yield higher rates than investment securities, increased $12,044,000, from $910,630,000 for the six months ended June 30, 2018 to $922,674,000 for the six months ended June 30, 2019. The effective yield on average loans increased to 5.59% for the six months ended June 30, 2019, compared to 5.46% for the six months ended June 30, 2018.
Total average assets for the six months ended June 30, 2019 was $1,562,541,000 compared to $1,606,475,000 for the six months ended June 30, 2018, a decrease of $43,934,000 or 2.73%. During the six months ended June 30, 2019 and 2018, the loan-to-deposit ratio was 74.20% and 70.60%, respectively. Total average deposits decreased $78,278,000 or 5.75% to $1,282,041,000 for the six months ended June 30, 2019, compared to $1,360,319,000 for the six months ended June 30, 2018. Average interest-bearing deposits decreased $70,404,000, or 8.69%, and average non-interest bearing demand deposits decreased $7,874,000, or 1.43%, for the six months ended June 30, 2019, compared to the six months ended June 30, 2018. The Company’s ratio of average non-interest bearing deposits to total deposits was 42.28% for the six months ended June 30, 2019, compared to 40.42% for the six months ended June 30, 2018.

- more -


Central Valley Community Bancorp -- page 5


Non-interest income for the six months ended June 30, 2019 increased by $2,117,000 to $7,574,000, compared to $5,457,000 for the six months ended June 30, 2018, primarily driven by an increase of $2,614,000 in net realized gains on sales and calls of investment securities, an increase of $123,000 in other income, and an increase in loan placement fees of $20,000, offset by decrease in gain on sale of credit card portfolio of $578,000 and a decrease in service charge income of $78,000.
Non-interest expense for the six months ended June 30, 2019 increased $572,000, or 2.50%, to $23,439,000 compared to $22,867,000 for the six months ended June 30, 2018. The net increase year over year resulted from increases in information technology of $948,000, salaries and employee benefits of $153,000, and directors’ expenses of $146,000, offset by decreases in acquisition and integration expenses of $217,000, professional services of $194,000, data processing expenses of $54,000, and occupancy and equipment expenses of $183,000 in 2019 compared to 2018. The increase in the information technology expenses was a result of the Company outsourcing its network maintenance and IT support during the fourth quarter of 2018. The increase in the directors’ expenses was related to the change in the discount rate used to calculate the liability for deferred compensation and split dollar plans.
The Company recorded an income tax provision of $4,338,000 for the six months ended June 30, 2019, compared to $3,107,000 for the six months ended June 30, 2018. The effective tax rate for the six months June 30, 2019 was 27.73% compared to 23.25% for the six months June 30, 2018. The increase in the effective rate was a result of a decrease in tax-exempt interest.
Quarter Ended June 30, 2019
For the quarter ended June 30, 2019, the Company reported unaudited consolidated net income of $6,087,000 and earnings per diluted common share of $0.45, compared to consolidated net income of $4,965,000 and $0.36 per diluted share for the same period in 2018. The increase in net income during the second quarter of 2019 compared to the same period in 2018 was primarily due to an increase in net interest income of $549,000, and an increase in non-interest income of $1,912,000, offset by an increase in the provision for income taxes of $816,000, and an increase in total non-interest expenses of $273,000. The effective tax rate increased to 28.15% from 24.01% for the quarters ended June 30, 2019 and June 30, 2018, respectively. Net income for the immediately trailing quarter ended March 31, 2019 was $5,216,000, or $0.38 per diluted common share.

- more -


Central Valley Community Bancorp -- page 6


Annualized return on average equity (ROE) for the second quarter of 2019 was 10.68%, compared to 9.53% for the same period of 2018. The increase in ROE reflects increase in net income, notwithstanding an increase in shareholders’ equity. Annualized return on average assets (ROA) was 1.54% for the second quarter of 2019 compared to 1.25% for the same period in 2018. This increase is due to an increase in net income notwithstanding a decrease in average assets.
In comparing the second quarter of 2019 to the second quarter of 2018, average total loans increased by $20,784,000, or 2.26%. During the second quarter of 2019, the Company recorded net loan charge-off of $13,000 compared to $82,000 net loan recoveries for the same period in 2018. The net charge-off (recovery) ratio, which reflects annualized net charge-offs to average loans, was 0.01% for the quarter ended June 30, 2019 compared to (0.04)% for the quarter ended June 30, 2018.
Average total deposits for the second quarter of 2019 decreased $62,091,000 or 4.65% to $1,274,159,000 compared to $1,336,250,000 for the same period of 2018. In comparing the second quarter of 2019 to the second quarter of 2018, average borrowed funds increased $29,253,000 or 118.44% to $53,952,000 compared to $24,699,000.
The Company’s net interest margin (fully tax equivalent basis) was 4.50% for the quarter ended June 30, 2019, compared to 4.35% for the quarter ended June 30, 2018. Net interest income, before provision for credit losses, increased $549,000, or 3.57%, to $15,946,000 for the second quarter of 2019, compared to $15,397,000 for the same period in 2018. The accretion of the loan marks on acquired loans increased interest income by $192,000 and $332,000 during the quarters ended June 30, 2019 and 2018, respectively. Net interest income during the second quarters of 2019 and 2018 benefited by approximately $56,000 and $196,000, respectively, from prepayment penalties and payoff of loans previously on nonaccrual status. The net interest margin period-to-period comparisons were impacted by an increase in the yield on the average investment securities and the loan portfolio. Over the same periods, the cost of total deposits increased to 0.15% from 0.08%.
For the quarter ended June 30, 2019, the Company’s average investment securities, including interest-earning deposits in other banks and Federal funds sold, decreased by $36,160,000, or 6.79%, compared to the quarter ended June 30, 2018, and increased by $540,000, or 0.11%, compared to the quarter ended March 31, 2019.

- more -


Central Valley Community Bancorp -- page 7


The effective yield on average investment securities, including interest earning deposits in other banks and Federal funds sold, was 3.17% for the quarter ended June 30, 2019, compared to 2.67% for the quarter ended June 30, 2018 and 3.13% for the quarter ended March 31, 2019. Total average loans, which generally yield higher rates than investment securities, increased by $20,784,000 to $939,055,000 for the quarter ended June 30, 2019, from $918,271,000 for the quarter ended June 30, 2018 and increased by $32,944,000 from $906,111,000 for the quarter ended March 31, 2019. The effective yield on average loans was 5.55% for the quarter ended June 30, 2019, compared to 5.49% and 5.64% for the quarters ended June 30, 2018 and March 31, 2019, respectively.
Total average assets for the quarter ended June 30, 2019 were $1,584,122,000 compared to $1,588,644,000 for the quarter ended June 30, 2018 and $1,540,721,000 for the quarter ended March 31, 2019, a decrease of $4,522,000 and an increase of $43,401,000, or (0.28)% and 2.82%, respectively.
Total average deposits decreased $62,091,000, or 4.65%, to $1,274,159,000 for the quarter ended June 30, 2019, compared to $1,336,250,000 for the quarter ended June 30, 2018. Total average deposits decreased $15,853,000, or 1.23%, for the quarter ended June 30, 2019, compared to $1,290,012,000 for the quarter ended March 31, 2019. The Company’s ratio of average non-interest bearing deposits to total deposits was 42.45% for the quarter ended June 30, 2019, compared to 40.85% and 42.10% for the quarters ended June 30, 2018 and March 31, 2019, respectively.
Non-interest income increased $1,912,000, or 71.18%, to $4,598,000 for the second quarter of 2019 compared to $2,686,000 for the same period in 2018. For the quarter ended June 30, 2019, non-interest income included $2,459,000 net realized gains on sales and calls of investment securities compared to net realized gains of $82,000 for the same period in 2018, a $2,377,000 increase. During the second quarter of 2019 loan placement fees increased $47,000, other income increased by $61,000, and interchange fees increased $4,000, offset by a decrease in the gain on sale of credit card portfolio of $578,000, and a decrease in service charge income of $13,000 compared to the same period in 2018. Non-interest income for the quarter ended June 30, 2019 increased by $1,622,000 to $4,598,000, compared to $2,976,000 for the quarter ended March 31, 2019. The increase compared to the trailing quarter was primarily a $1,407,000 increase in net realized gains on sales and calls of investment securities, a $23,000 increase in service charges, and a $54,000 increase in other income.

- more -


Central Valley Community Bancorp -- page 8


Non-interest expense for the quarter ended June 30, 2019 increased $273,000, or 2.37%, to $11,772,000 compared to $11,499,000 for the quarter ended June 30, 2018. The net increase quarter over quarter was a result of an increase of $383,000 in information technology expenses, an increase of $80,000 in amortization of core deposit intangibles, an increase in salaries and employee benefits of $79,000, and an increase of $10,000 in advertising expenses, partially offset by a decrease in occupancy and equipment expenses of $125,000, a decrease in professional services of $83,000, a decrease of $26,000 in regulatory assessments, and a decrease of $114,000 in operating losses.
Non-interest expense for the quarter ended June 30, 2019 increased by $105,000 compared to $11,667,000 for the trailing quarter ended March 31, 2019. The increase compared to the trailing quarter was primarily due to an increase in salaries and employee benefits of $422,000, and an increase of $17,000 in directors’ expense, partially offset by a $172,000 decrease in information technology expenses, a $71,000 decrease in other non-interest expenses, and a decrease in occupancy and equipment expense of $27,000.
The majority of the $71,000 decrease in other non-interest expenses was comprised of a decrease of $112,000 in credit card operation expenses and a $40,000 decrease in personnel costs, offset by a $24,000 increase in stationery and supplies. The increase in salaries and employee benefits of $422,000 was the result of increased salaries and interest on deferred compensation plans as a result of change in discount rate.
The Company recorded an income tax provision of $2,385,000 for the quarter ended June 30, 2019, compared to $1,569,000 for the quarter ended June 30, 2018. The effective tax rate for the quarter ended June 30, 2019 was 28.15% compared to 24.01% for the same period in 2018. The increase in the effective tax rate was the result of a decrease in tax exempt interest.
Quarterly Dividend Announcement
On July 17, 2019, the Board of Directors of the Company declared an increase in the regular quarterly cash dividend to $0.11 per share on the Company’s common stock. The dividend is payable on August 16, 2019 to shareholders of record as of August 2, 2019.

- more -


Central Valley Community Bancorp -- page 9


Stock Repurchase Plan Announcement
The Board of Directors of the Company also approved the adoption of a program to effect repurchases of the Company’s common stock. Under the program, the Company may repurchase up to $10 million of the Company’s outstanding shares of common stock, which represents approximately 3% of the Company’s outstanding shares of common stock, or approximately 479,616 shares based on the closing stock price of the Company’s common stock on July 16, 2019 of $20.85. The share repurchase program will begin on July 22, 2019 and end on July 17, 2020. The shares will be repurchased in open market transactions through brokers, subject to availability. All such transactions will be structured to comply with SEC Rule 10b-18, and all shares repurchased will be retired.
Central Valley Community Bancorp trades on the NASDAQ stock exchange under the symbol CVCY. Central Valley Community Bank, headquartered in Fresno, California, was founded in 1979 and is the sole subsidiary of Central Valley Community Bancorp. Central Valley Community Bank operates 20 full-service offices throughout California’s San Joaquin Valley and Greater Sacramento Region.  Additionally, the Bank maintains Commercial Real Estate, Agribusiness and SBA Lending Departments. Central Valley Investment Services are provided by Raymond James Financial, Inc.
Members of Central Valley Community Bancorp’s and the Bank’s Board of Directors are: Daniel J. Doyle (Chairman), Daniel N. Cunningham (Vice Chairman), Edwin S. Darden, Jr., F. T. “Tommy” Elliott, IV, James M. Ford, Robert J. Flautt, Gary D. Gall, Steven D. McDonald, Louis C. McMurray, Karen Musson, and William S. Smittcamp. Sidney B. Cox is Director Emeritus.
More information about Central Valley Community Bancorp and Central Valley Community Bank can be found at www.cvcb.com. Also, visit Central Valley Community Bank on Twitter and Facebook.
###
Forward-looking Statements- Certain matters discussed in this press release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  All statements contained herein that are not historical facts, such as statements regarding the Company’s current business strategy and the Company’s plans for future development and operations, are based upon current expectations. These statements are forward-looking in nature and involve a number of risks and uncertainties.  Such risks and uncertainties include, but are not limited to (1) significant increases in competitive pressure in the banking industry; (2) the impact of changes in interest rates; (3) a decline in economic conditions at the international, national or local level on the Company’s results of operations; (4) the Company’s ability to continue its internal growth at historical rates; (5) the Company’s ability to maintain its net interest margin; (6) the quality of the Company’s earning assets; (7) changes in the regulatory environment; (8) fluctuations in the real estate market; (9) changes in business conditions and inflation; (10) changes in securities markets; and (11) the other risks set forth in the Company’s reports filed with the Securities and Exchange Commission (“SEC”), including its Annual Report on Form 10-K for the year ended December 31, 2018.  Therefore, the information set forth in such forward-looking statements should be carefully considered when evaluating the business prospects of the Company.

- more -


Central Valley Community Bancorp -- page 10


CENTRAL VALLEY COMMUNITY BANCORP
CONSOLIDATED BALANCE SHEETS
(Unaudited)
 
 
June 30,
 
December 31,
 
June 30,
(In thousands, except share amounts)
 
2019
 
2018
 
2018
 
 
 
 
 
 
 
ASSETS
 
 
 
 
 
 
Cash and due from banks
 
$
33,787

 
$
24,954

 
$
29,811

Interest-earning deposits in other banks
 
14,739

 
6,725

 
16,812

Federal funds sold
 
77

 
48

 
7

Total cash and cash equivalents
 
48,603

 
31,727

 
46,630

Available-for-sale investment securities
 
476,211

 
463,905

 
484,001

Equity securities
 
7,458

 
7,254

 
7,254

Loans, less allowance for credit losses of $9,405, $9,104 and $8,920 at June 30, 2019, December 31, 2018, and June 30, 2018, respectively
 
950,806

 
909,591

 
925,914

Bank premises and equipment, net
 
7,742

 
8,484

 
9,131

Bank owned life insurance
 
29,863

 
28,502

 
28,154

Federal Home Loan Bank stock
 
6,062

 
6,843

 
6,843

Goodwill
 
53,777

 
53,777

 
53,777

Core deposit intangibles
 
2,225

 
2,572

 
2,840

Accrued interest receivable and other assets
 
30,480

 
25,181

 
25,359

Total assets
 
$
1,613,227

 
$
1,537,836

 
$
1,589,903

 
 
 
 
 
 
 
LIABILITIES AND SHAREHOLDERS’ EQUITY
 
 
 
 
 
 
Deposits:
 
 
 
 
 
 
Non-interest bearing
 
$
558,000

 
$
550,657

 
$
554,465

Interest bearing
 
736,087

 
731,641

 
769,746

Total deposits
 
1,294,087

 
1,282,298

 
1,324,211

Short-term borrowings
 
54,000

 
10,000

 
30,000

Junior subordinated deferrable interest debentures
 
5,155

 
5,155

 
5,155

Accrued interest payable and other liabilities
 
28,305

 
20,645

 
19,353

Total liabilities
 
1,381,547

 
1,318,098

 
1,378,719

Shareholders’ equity:
 
 
 
 
 
 
Preferred stock, no par value; 10,000,000 shares authorized, none issued and outstanding
 

 

 

Common stock, no par value; 80,000,000 shares authorized; issued and outstanding: 13,488,983, 13,754,965, and 13,785,591, at June 30, 2019, December 31, 2018, and June 30, 2018, respectively
 
98,210

 
103,851

 
104,226

Retained earnings
 
128,723

 
120,294

 
111,545

Accumulated other comprehensive income (loss), net of tax
 
4,747

 
(4,407
)
 
(4,587
)
Total shareholders’ equity
 
231,680

 
219,738

 
211,184

Total liabilities and shareholders’ equity
 
$
1,613,227

 
$
1,537,836

 
$
1,589,903


- more -


Central Valley Community Bancorp -- page 11


CENTRAL VALLEY COMMUNITY BANCORP
CONSOLIDATED INCOME STATEMENTS
(Unaudited)
 
 
For the Three Months Ended,
 
For the Six Months Ended
 
 
June 30,
 
March 31,
 
June 30,
 
June 30,
(In thousands, except share and per share amounts)
 
2019
 
2019
 
2018
 
2019
 
2018
INTEREST INCOME:
 
 
 
 
 
 
 
 
 
 
Interest and fees on loans
 
$
12,955

 
$
12,554

 
$
12,519

 
$
25,509

 
$
24,525

Interest on deposits in other banks
 
59

 
150

 
44

 
209

 
142

Interest and dividends on investment securities:
 
 
 
 
 
 
 
 
 
 
Taxable
 
3,337

 
3,023

 
2,185

 
6,360

 
4,744

Exempt from Federal income taxes
 
429

 
562

 
1,045

 
991

 
2,112

Total interest income
 
16,780

 
16,289

 
15,793

 
33,069

 
31,523

INTEREST EXPENSE:
 
 
 
 
 
 
 
 
 
 
Interest on deposits
 
469

 
393

 
252

 
862

 
490

Interest on junior subordinated deferrable interest debentures
 
55

 
57

 
52

 
112

 
95

Other
 
310

 
4

 
92

 
314

 
115

Total interest expense
 
834

 
454

 
396

 
1,288

 
700

Net interest income before provision for credit losses
 
15,946

 
15,835

 
15,397

 
31,781

 
30,823

PROVISION FOR (REVERSAL OF) CREDIT LOSSES
 
300

 
(25
)
 
50

 
275

 
50

Net interest income after provision for credit losses
 
15,646

 
15,860

 
15,347

 
31,506

 
30,773

NON-INTEREST INCOME:
 
 
 
 
 
 
 
 
 
 
Service charges
 
713

 
690

 
726

 
1,403

 
1,481

Net realized gains on sale of credit card portfolio
 

 

 
578

 

 
578

Appreciation in cash surrender value of bank owned life insurance
 
190

 
171

 
176

 
361

 
347

Interchange fees
 
384

 
343

 
380

 
727

 
725

Loan placement fees
 
220

 
139

 
173

 
359

 
339

Net realized gains on sales and calls of investment securities
 
2,459

 
1,052

 
82

 
3,511

 
897

Federal Home Loan Bank dividends
 
118

 
121

 
118

 
239

 
239

Other income
 
514

 
460

 
453

 
974

 
851

Total non-interest income
 
4,598

 
2,976

 
2,686

 
7,574

 
5,457

NON-INTEREST EXPENSES:
 
 
 
 
 
 
 
 
 
 
Salaries and employee benefits
 
6,912

 
6,490

 
6,833

 
13,402

 
13,249

Occupancy and equipment
 
1,452

 
1,479

 
1,577

 
2,931

 
3,114

Acquisition and integration expenses
 

 

 

 

 
217

Professional services

280


327

 
363


607


801

Data processing expense
 
401

 
395

 
370

 
796

 
850

Directors’ expenses
 
193

 
176

 
133

 
369

 
223

ATM/Debit card expenses
 
186

 
191

 
176

 
377

 
377

Information technology
 
605

 
777

 
222

 
1,382

 
434

Regulatory assessments
 
134

 
152

 
160

 
286

 
322

Advertising
 
198

 
202

 
188

 
400

 
377

Internet banking expenses
 
199

 
194

 
175

 
393

 
370

Amortization of core deposit intangibles
 
173

 
174

 
93

 
347

 
187

Other expense
 
1,039

 
1,110

 
1,209

 
2,149

 
2,346

Total non-interest expenses
 
11,772

 
11,667

 
11,499

 
23,439

 
22,867

Income before provision for income taxes
 
8,472

 
7,169

 
6,534

 
15,641

 
13,363

PROVISION FOR INCOME TAXES
 
2,385

 
1,953

 
1,569

 
4,338

 
3,107

Net income
 
$
6,087

 
$
5,216

 
$
4,965

 
$
11,303

 
$
10,256

 
 
 
 
 
 
 
 
 
 
 
Net income per common share:
 
 
 
 
 
 
 
 
 
 
Basic earnings per common share
 
$
0.45

 
$
0.38

 
$
0.36

 
$
0.84

 
$
0.75


- more -


Central Valley Community Bancorp -- page 12


Weighted average common shares used in basic computation
 
13,533,724

 
13,646,489

 
13,692,358

 
13,515,752

 
13,681,229

Diluted earnings per common share
 
$
0.45

 
$
0.38

 
$
0.36

 
$
0.83

 
$
0.74

Weighted average common shares used in diluted computation
 
13,635,834

 
13,755,615

 
13,823,278

 
13,612,866

 
13,814,087

Cash dividends per common share
 
$
0.11

 
$
0.10

 
$
0.07

 
$
0.21

 
$
0.14


- more -


Central Valley Community Bancorp -- page 13


CENTRAL VALLEY COMMUNITY BANCORP
CONDENSED CONSOLIDATED INCOME STATEMENTS
(Unaudited)
 
 
Jun. 30
 
Mar. 31
 
Dec. 31,
 
Sep. 30
 
Jun. 30,
For the three months ended
 
2019
 
2019
 
2018
 
2018
 
2018
(In thousands, except share and per share amounts)
 
 
 
 
 
 
 
 
 
 
Net interest income
 
$
15,946

 
$
15,835

 
$
15,973

 
$
15,907

 
$
15,397

Provision for (reversal of) credit losses
 
300

 
(25
)
 

 

 
50

Net interest income after provision for credit losses
 
15,646

 
15,860

 
15,973

 
15,907

 
15,347

Total non-interest income
 
4,598

 
2,976

 
2,404

 
2,463

 
2,686

Total non-interest expense
 
11,772

 
11,667

 
11,410

 
10,791

 
11,499

Provision for income taxes
 
2,385

 
1,953

 
1,686

 
1,827

 
1,569

Net income
 
$
6,087

 
$
5,216

 
$
5,281

 
$
5,752

 
$
4,965

Basic earnings per common share
 
$
0.45

 
$
0.38

 
$
0.38

 
$
0.42

 
$
0.36

Weighted average common shares used in basic computation
 
13,533,724

 
13,646,489

 
13,721,087

 
13,715,141

 
13,692,358

Diluted earnings per common share
 
$
0.45

 
$
0.38

 
$
0.38

 
$
0.42

 
$
0.36

Weighted average common shares used in diluted computation
 
13,635,834

 
13,755,615

 
13,834,662

 
13,836,828

 
13,823,278


CENTRAL VALLEY COMMUNITY BANCORP
SELECTED RATIOS
(Unaudited)
 
 
Jun. 30,
 
Mar. 31,
 
Dec. 31,
 
Sept. 30,
 
Jun. 30,
As of and for the three months ended
 
2019
 
2019
 
2018
 
2018
 
2018
(Dollars in thousands, except per share amounts)
 
 
 
 
 

 
 
 
 
Allowance for credit losses to total loans
 
0.98
%
 
0.99
 %
 
0.99
 %
 
0.99
 %
 
0.95
 %
Non-performing assets to total assets
 
0.15
%
 
0.10
 %
 
0.18
 %
 
0.27
 %
 
0.26
 %
Total non-performing assets
 
$
2,442

 
$
1,548

 
$
2,740

 
$
4,133

 
$
4,092

Total nonaccrual loans
 
$
2,442

 
$
1,548

 
$
2,740

 
$
4,133

 
$
4,092

Net loan charge-offs (recoveries)
 
$
13

 
$
(39
)
 
$
(79
)
 
$
(105
)
 
$
(82
)
Net charge-offs (recoveries) to average loans (annualized)
 
0.01
%
 
(0.02
)%
 
(0.03
)%
 
(0.05
)%
 
(0.04
)%
Book value per share
 
$
17.18

 
$
16.63

 
$
15.98

 
$
15.47

 
$
15.32

Tangible book value per share
 
$
13.02

 
$
12.52

 
$
11.87

 
$
11.37

 
$
11.21

Tangible common equity
 
$
175,678

 
$
171,279

 
$
163,389

 
$
156,911

 
$
154,567

Cost of total deposits
 
0.15
%
 
0.12
 %
 
0.10
 %
 
0.10
 %
 
0.08
 %
Interest and dividends on investment securities exempt from Federal income taxes
 
$
429

 
$
562

 
$
530

 
$
896

 
$
1,045

Net interest margin (calculated on a fully tax equivalent basis) (1)
 
4.50
%
 
4.63
 %
 
4.55
 %
 
4.53
 %
 
4.35
 %
Return on average assets (2)
 
1.54
%
 
1.35
 %
 
1.37
 %
 
1.48
 %
 
1.25
 %
Return on average equity (2)
 
10.68
%
 
9.42
 %
 
9.82
 %
 
10.80
 %
 
9.53
 %
Loan to deposit ratio
 
74.20
%
 
71.32
 %
 
71.64
 %
 
71.49
 %
 
70.60
 %
Efficiency ratio
 
63.78
%
 
63.92
 %
 
60.80
 %
 
58.65
 %
 
62.99
 %
Tier 1 leverage - Bancorp
 
11.43
%
 
11.69
 %
 
11.48
 %
 
11.16
 %
 
10.59
 %
Tier 1 leverage - Bank
 
11.36
%
 
11.64
 %
 
11.32
 %
 
11.06
 %
 
10.44
 %
Common equity tier 1 - Bancorp
 
14.72
%
 
15.13
 %
 
15.13
 %
 
15.17
 %
 
14.35
 %
Common equity tier 1 - Bank
 
15.08
%
 
15.50
 %
 
15.38
 %
 
15.51
 %
 
14.59
 %
Tier 1 risk-based capital - Bancorp
 
15.16
%
 
15.58
 %
 
15.59
 %
 
15.64
 %
 
14.80
 %
Tier 1 risk-based capital - Bank
 
15.08
%
 
15.50
 %
 
15.38
 %
 
15.51
 %
 
14.59
 %
Total risk-based capital - Bancorp
 
16.00
%
 
16.41
 %
 
16.44
 %
 
16.51
 %
 
15.64
 %
Total risk based capital - Bank
 
15.91
%
 
16.34
 %
 
16.23
 %
 
16.37
 %
 
15.43
 %
(1) Net Interest Margin is computed by dividing annualized quarterly net interest income by quarterly average interest-bearing assets.
(2) Computed by annualizing quarterly net income.


- more -


Central Valley Community Bancorp -- page 14


CENTRAL VALLEY COMMUNITY BANCORP
AVERAGE BALANCES AND RATES
(Unaudited)
 
 
For the Three Months Ended
 
For the Six Months Ended
AVERAGE AMOUNTS
 
June 30,
 
March 31,
 
June 30,
 
June 30,
 
June 30,
(Dollars in thousands)
 
2019
 
2019
 
2018
 
2019
 
2018
Federal funds sold
 
$
119

 
$
105

 
$
35

 
$
112

 
$
48

Interest-bearing deposits in other banks
 
11,195

 
24,571

 
11,037

 
17,846

 
18,208

Investments
 
485,031

 
471,129

 
521,433

 
478,118

 
536,753

Loans (1)
 
936,602

 
903,415

 
914,236

 
920,099

 
906,566

Earning assets
 
1,432,947

 
1,399,220

 
1,446,741

 
1,416,175

 
1,461,575

Allowance for credit losses
 
(9,234
)
 
(9,124
)
 
(8,822
)
 
(9,179
)
 
(8,806
)
Nonaccrual loans
 
2,453

 
2,696

 
4,035

 
2,575

 
4,064

Other non-earning assets
 
157,956

 
147,929

 
146,690

 
152,970

 
149,642

Total assets
 
$
1,584,122

 
$
1,540,721

 
$
1,588,644

 
$
1,562,541

 
$
1,606,475

 
 
 
 
 
 
 
 
 
 
 
Interest bearing deposits
 
$
733,291

 
$
746,875

 
$
790,396

 
$
740,045

 
$
810,449

Other borrowings
 
53,952

 
5,766

 
24,699

 
29,992

 
17,837

Total interest-bearing liabilities
 
787,243

 
752,641

 
815,095

 
770,037

 
828,286

Non-interest bearing demand deposits
 
540,868

 
543,137

 
545,854

 
541,996

 
549,870

Non-interest bearing liabilities
 
28,078

 
23,433

 
19,221

 
25,766

 
19,783

Total liabilities
 
1,356,189

 
1,319,211

 
1,380,170

 
1,337,799

 
1,397,939

Total equity
 
227,933

 
221,510

 
208,474

 
224,742

 
208,536

Total liabilities and equity
 
$
1,584,122

 
$
1,540,721

 
$
1,588,644

 
$
1,562,541

 
$
1,606,475

 
 
 
 
 
 
 
 
 
 
 
AVERAGE RATES
 
 
 
 
 
 
 
 
 
 
Federal funds sold
 
2.40
%
 
2.40
%
 
1.78
%
 
2.39
%
 
1.61
%
Interest-earning deposits in other banks
 
2.11
%
 
2.44
%
 
1.63
%
 
2.34
%
 
1.56
%
Investments
 
3.20
%
 
3.17
%
 
2.69
%
 
3.18
%
 
2.76
%
Loans (3)
 
5.55
%
 
5.64
%
 
5.49
%
 
5.59
%
 
5.46
%
Earning assets
 
4.73
%
 
4.76
%
 
4.46
%
 
4.75
%
 
4.43
%
Interest-bearing deposits
 
0.26
%
 
0.21
%
 
0.13
%
 
0.23
%
 
0.12
%
Other borrowings
 
2.71
%
 
4.23
%
 
2.33
%
 
2.84
%
 
2.35
%
Total interest-bearing liabilities
 
0.42
%
 
0.24
%
 
0.19
%
 
0.34
%
 
0.17
%
Net interest margin (calculated on a fully tax equivalent basis) (2)
 
4.50
%
 
4.63
%
 
4.35
%
 
4.56
%
 
4.33
%
(1)
Average loans do not include nonaccrual loans.
(2)
Calculated on a fully tax equivalent basis, which includes Federal tax benefits relating to income earned on municipal bonds of $114, $150, and $278, for the three months ended June 30, 2019, March 31, 2019, and June 30, 2018, respectively. The Federal tax benefits relating to income earned on municipal bonds totaled $264 and $562 for the six months ended June 30, 2019 and 2018, respectively.
(3)
Loan yield includes loan fees (costs) for the three months ended June 30, 2019, March 31, 2019, and June 30, 2018 of $(42), $26, and $107, respectively. Loan yield includes loan fees (costs) for the six months ended June 30, 2019 and 2018 of $(16) and $228, respectively.

CONTACT: Investor Contact:
Dave Kinross
Executive Vice President and Chief Financial Officer
Central Valley Community Bancorp
559-323-3420

Media Contact:
Debbie Nalchajian-Cohen
Marketing Director
Central Valley Community Bancorp
559-222-1322


(Back To Top)