People’s Bank Reports Earnings

Company Release - 10/22/2019 8:40 PM ET

MEDFORD, Ore.--(BUSINESS WIRE)-- People’s Bank of Commerce (OTCBB: PBCO) announced today its financial results for the third quarter and year-to-date 2019. The bank reported net income of $947,000 or $0.30 per basic and diluted share for the third quarter of 2019, compared to net income of $948,000 or $0.31 per share in the same quarter of 2018. Earnings for the first nine months of 2019 totaled $2,719,000 or $0.89 per share compared to $2,516,000 or $0.85 per share during the first three quarters of 2018. Earnings per share for the trailing 12 months ending September 30, 2019 were $1.19 per share compared to $0.94 per diluted share during the same period one year earlier.

Balance Sheet September 30, 2019 vs. September 30, 2018:

  • Total Loans increased 13%
  • Total Deposits increased 7%
  • Total Assets increased 8%
  • Total Equity increased 14%

Income Statement year-to-date September 30, 2019 vs. September 30, 2018:

  • Net-interest Income increased 16%
  • Pre-tax income increased 11%
  • Non-interest Income decreased 4%
  • Non-interest Expense increased 9%

President’s Comments

“Total loans continue to show good growth over the past 9 months,” stated Ken Trautman, bank President and CEO. “The bank’s factoring division, Steelhead Finance, has seen a softening in income in 2019 which follows the trucking industry’s reduced activity. The bank retooled its residential mortgage department in 2019, which is now starting to pay dividends, with an increase in income for the first nine months of 2019 over 2018 of 64%,” commented Trautman. “2019 has been a year of change for the bank, which included a core processing conversion as well as staff reductions in our branch system allowed by improved technology and processing centralization,” added Trautman.

Provision for Credit Losses

The bank’s YTD provision for loan and lease losses was $211 thousand compared a provision of $293 thousand during the same period last year. Credit quality remains strong with no loans past due over 90 days or on non-accrual at the end of September 2019 and September 2018. At the end of the third quarter 2019, the loan loss reserve was 1.117% of loans held for investment compared to 1.124% at the end of the third quarter 2018.

Non-Interest Income

For the quarter ending September 30, 2019, non-interest income was $1.70 million compared to $1.74 million in the same quarter one year earlier. For the first three quarters of 2019, non-interest income was lower than the previous year with $4.9 million compared to $5.1 million year-to-date in 2018. Steelhead Finance, the bank’s factoring division, generated $3.2 million in non-interest income during the three quarters of 2019.

Non-Interest Expense

For the quarter ending September 30, 2019, non-interest expense was $3.9 million compared to $3.6 million in the same quarter of 2018. Year-to-date non-interest expense totaled $11.4 million through September 30, 2019, compared to $10.5 million in the same period the prior year.

Capital

As of September 30, 2019, shareholder’s equity totaled $38.8 million, compared to $34.0 million at September 30, 2018. The bank’s Tier 1 capital ratio was 9.73% at the end of the third quarter 2019, compared to 9.28% one year ago. Tangible Book value per share was $11.23 on September 30, 2019, compared to $10.10 on September 30, 2018, when adjusted for the 5% stock dividend received in May of 2019.

About People’s Bank of Commerce

People’s Bank of Commerce’s stock trades on the over-the-counter market under the symbol PBCO. Additional information about the Bank is available in the investor section of the bank’s website at: www.peoplesbank.bank

Founded in 1998, People’s Bank of Commerce is the only locally owned and managed community bank in Southern Oregon. People’s Bank of Commerce is a full service bank headquartered in Medford, Oregon with branches in Medford, Ashland, Central Point, Grants Pass and Klamath Falls.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995:

This release includes forward-looking statements intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally can be identified by phrases such as People’s Bank or its management "believes," "expects," "anticipates," "foresees," "forecasts," "estimates" or other words or phrases of similar import. Similarly, statements herein that describe People’s Bank’s business strategy, outlook, objectives, plans, intentions or goals also are forward-looking statements. All such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those in forward-looking statements.

People's Bank of Commerce     
Balance Sheet (unaudited)     
(dollars in thousands) 

9/30/2019

 

6/30/2019

 

3/31/2019

 

12/31/2018

 

9/30/2018

Assets      
Cash and due from banks 

2,798

 

3,747

 

4,736

 

9,382

 

3,928

Federal funds sold     
Interest-bearing deposits 

16,004

 

18,694

 

30,152

 

17,127

 

21,381

Investment securities 

23,212

 

22,585

 

20,031

 

25,878

 

24,462

Loans held for sale 

3,909

 

2,013

 

1,157

 

2,084

 

215

Loans held for investment, net of unearned income 

271,635

 

261,835

 

256,389

 

249,949

 

240,093

Allowance for loan and lease losses 

(3,033)

 

(2,920)

 

(2,880)

 

(2,812)

 

(2,701)

Loans, net 

268,602

 

258,915

 

254,666

 

247,137

 

237,392

Premises and equipment, net 

20,529

 

20,736

 

21,086

 

16,807

 

16,387

Other assets 

28,818

 

31,185

 

30,894

 

31,110

 

32,730

Total assets  

363,872

 

357,875

 

361,565

 

349,525

 

336,495

      
      
Liabilities      
Deposits     
Demand noninterest-bearing 

140,458

 

136,211

 

128,937

 

124,866

 

120,679

Demand interest-bearing 

47,020

 

46,690

 

56,175

 

48,813

 

44,661

Money market and savings 

108,614

 

105,310

 

110,237

 

117,714

 

112,728

Time deposits of less than $250,000 

15,419

 

17,915

 

16,750

 

15,300

 

15,017

Time deposits of more than $250,000 

2,949

 

2,682

 

1,873

 

1,317

 

2,081

Total deposits 

314,460

 

308,808

 

313,972

 

308,010

 

295,166

Other liabilities 

10,611

 

11,308

 

11,137

 

6,062

 

7,290

Total liabilities  

325,071

 

320,116

 

325,109

 

314,072

 

302,456

      
Capital     
Common stock, surplus, retained earnings 

38,879

 

37,913

 

36,863

 

36,011

 

34,920

Accumulated other comprehensive income (loss) 

249

 

212

 

(2)

 

(113)

 

(319)

Unearned ESOP Shares 

(327)

 

(366)

 

(405)

 

(445)

 

(562)

Total shareholders' equity 

38,801

 

37,759

 

36,456

 

35,453

 

34,039

      
Total Liabilities and Equity  

363,872

 

357,875

 

361,565

 

349,525

 

336,495

      
memo:     
Total intangible assets and goodwill 

3,486

 

3,486

 

3,486

 

3,486

 

3,468

      
Current shares outstanding 

3,122,591

 

3,122,155

 

2,955,964

 

2,953,464

 

2,913,752

      
People's Bank of Commerce     
Income Statement (unaudited)     
 

Three Months Ended

 

Twelve Months Ended

(dollars in thousands) 

9/30/2019

 

6/30/2019

 

9/30/2018

 

9/30/2019

 

9/30/2018

Interest Income      
Loans 

3,672

 

3,543

 

3,152

 

14,032

 

11,527

Investments 

160

 

130

 

152

 

608

 

660

Federal funds sold and due from banks 

136

 

92

 

182

 

498

 

449

Total interest income 

3,968

 

3,765

 

3,487

 

15,138

 

12,636

      
Interest Expense      
Deposits 

354

 

350

 

241

 

1,328

 

701

Other 

5

 

6

 

77

 

91

 

221

Total interest expense 

359

 

356

 

318

 

1,419

 

922

      
Net interest income 

3,609

 

3,409

 

3,169

 

13,719

 

11,714

Provision for credit losses 

113

 

39

 

69

 

323

 

365

Net Interest Income after provision for credit losses 

3,496

 

3,370

 

3,100

 

13,395

 

11,349

      
Non-Interest Income      
Service charges on deposit accounts 

84

 

78

 

76

 

307

 

304

Mortgage lending income 

294

 

261

 

130

 

914

 

656

Steelhead Finance income 

1,044

 

1,062

 

1,339

 

4,337

 

4,808

Gain (loss) on other real estate 

-

 

-

 

-

  

113

Other non-interest income 

273

 

274

 

199

 

892

 

736

Total non-interest income 

1,695

 

1,675

 

1,744

 

6,450

 

6,617

      
Non-Interest Expense      
Salary and Benefits 

2,434

 

2,425

 

2,297

 

9,585

 

8,563

Premises and fixed assets 

544

 

547

 

460

 

2,194

 

1,742

Other 

883

 

844

 

827

 

3,391

 

3,248

Total non-interest expense 

3,861

 

3,816

 

3,585

 

15,170

 

13,553

      
Net income before taxes 

1,330

 

1,229

 

1,259

 

4,676

 

4,413

Income taxes 

383

 

296

 

311

 

1,075

 

1,584

Net income 

947

 

933

 

948

 

3,601

 

2,829

      
Basic earnings per share 

0.30

 

0.30

 

0.31

 

1.19

 

0.96

Diluted earnings per share 

0.30

 

0.30

 

0.31

 

1.19

 

0.94

Average common shares outstanding 

3,122,591

 

3,110,261

 

3,055,384

 

3,028,945

 

2,948,101

      
Performance Measures      
Return on average assets 

1.02%

 

1.06%

 

1.11%

 

1.04%

 

0.88%

Return on average equity 

9.88%

 

10.09%

 

11.43%

 

9.73%

 

8.62%

Net interest margin 

4.54%

 

4.60%

 

4.05%

 

4.27%

 

4.21%

Efficiency ratio 

72.79%

 

75.06%

 

72.97%

 

75.21%

 

73.93%

 

Ken Trautman, President and CEO
(541) 774-7654, [email protected]

Source: People’s Bank of Commerce