NorCal Community Bancorp Reports First Quarter Earnings, Announces Reversal of Valuation Allowance on Deferred Tax Assets as of March 31, 2013 Business Wire ALAMEDA, Calif. -- April 19, 2013 NorCal Community Bancorp (the “Company”) (NCLC), parent company for Bank of Alameda, today reported net income for the three months ended March 31, 2013 of $6.4 million, or $0.60 per diluted share. Included in the 2013 results is a one-time income tax benefit of $5.9 million resulting from a deferred tax asset (“DTA”) valuation allowance reversal, offset by a current book tax provision of $293,000. Pretax income for the first quarter of 2013 was $793,000, a 195% increase from the $269,000 reported in the first quarter of 2012. The reversal of the DTA valuation allowance combined with net earnings resulted in tangible book value of $2.48 per share at March 31, 2013, an increase of $0.59 per share, or 31% over December tangible book value of $1.89 per share. Net income in the first quarter of 2013 was further augmented by a net gain on sale of other real estate of $585,000. “The Company has reported profitability in six out of the last seven consecutive quarters, with the second quarter of 2012 reporting a net loss. The second quarter loss was determined to be an isolated event associated with a large loan write-down. The improvement in asset quality, which has been sustained into the first quarter of 2013, coupled with the removal of the Bank’s informal agreement with its primary regulators in February 2013 prompted management to determine that those tax assets would more likely than not be recovered through future taxable income and that maintaining the valuation allowance was no longer necessary,” stated Jeanette E. Reynolds, NorCal Community Bancorp’s Chief Financial Officer. President and CEO, Stephen G. Andrews commented “The determination as to our ability to realize the full amount of the deferred tax assets validates our future outlook for the Company fueled by an improving Bay Area economy. The removal of the informal agreement between the Bank, the FDIC and the California Department of Financial Institutions in February 2013 was another positive factor.” Total loans and leases decreased $3.4 million, or 2.0% to $170.6 million at March 31, 2013 compared to $174.0 million at March 31, 2012. Included in the decrease in loans between these two periods was a $6.1 million reduction in non-performing assets and restructured debt. Total non-performing assets and restructured debt at March 31, 2013 was $3.1 million, or 1.16% of total assets, compared to $9.2 million, or 3.4% to total assets at March 31, 2013. Total deposits at March 31, 2013 were $228.7 million, a decrease of $9.8 million, or 4.1% at March 31, 2013 compared to March 31, 2012. The decrease is attributed to fluctuating balances with our large depositors. The overall cost of the deposit base has decreased 17 basis points to 0.19% for the quarter ended March 31, 2013 compared to 0.36% for the same period in 2012. In closing, Mr. Andrews stated “This quarter’s results reflect a significant improvement in value for our shareholders. An improving local economy is expected to lead to loan growth and improving operating results as we move forward.” A copy of the Company’s information and disclosure statement pursuant to Securities and Exchange Commission Rule 15c2-11 can be found on the home page of the Company’s website at www.bankofalameda.com under the Investor Relations section. Cautionary Statement: This release may contain certain forward-looking statements that are subject to risks and uncertainties that could cause actual results and events to differ materially from those stated herein. Words such as “anticipate,” “believe,” “estimate,” “expect,” “should,” “intend,” “project,” and words or phrases of similar meaning are intended to identify forward-looking statements. Management’s assumptions and projections are based on their anticipation of future events and actual performance may differ materially from that projected. NorCal Community Bancorp FINANCIAL HIGHLIGHTS (Dollar amounts in thousands, except share and per share data) (Unaudited) Three Months Ended March 31, March 31, FOR THE PERIOD 2013 2012 Total interest income $ 2,437 $ 2,625 Total interest expense 126 194 Net interest income before provision for 2,311 2,431 loan and lease losses Provision for loan and lease losses - 75 Net interest income after provision for loan 2,311 2,356 and lease losses Noninterest income 965 305 Noninterest expense 2,483 2,392 Income before income tax benefit 793 269 Income tax benefit (5,647 ) - Net Income $ 6,440 $ 269 Basic income per share $ 0.61 $ 0.03 Diluted income per share $ 0.60 $ 0.03 Average shares outstanding 10,610,716 10,610,716 Diluted average shares for the period 10,660,413 10,611,777 SELECTED FINANCIAL RATIOS (Annualized) Return on average assets 10.06 % 0.43 % Return on average equity 129.15 % 5.11 % Yield on earning assets 3.89 % 4.22 % Cost of funds 0.21 % 0.35 % Net interest margin 3.69 % 3.91 % Efficiency ratio 75.80 % 87.43 % Net charge-offs as a percentage of average 0.43 % 1.39 % loans and leases Loan loss provision as a percentage of 0.00 % 0.18 % average loans and leases Financial Highlights - Continued As of March 31, March 31, % CONSOLIDATED BALANCE SHEET 2013 2012 Change ASSETS Cash and due from banks Non-interest bearing $ 1,762 $ 1,598 10 % Interest bearing 24,448 28,838 -15 % Investment securities 58,573 61,077 -4 % Loans and leases 170,602 173,999 -2 % Allowance for loan and lease losses (3,369 ) (4,305 ) -22 % Net loans and leases 167,233 169,694 -1 % Other real estate 547 1,734 -68 % Other assets 12,128 6,290 93 % TOTAL ASSETS $ 264,691 $ 269,231 -2 % LIABILITIES Deposits Non-interest bearing $ 72,334 $ 81,385 -11 % Interest bearing 156,335 157,118 0 % Total deposits 228,669 238,503 -4 % Subordinated debentures 8,248 8,248 0 % Other liabilities 1,411 1,216 16 % TOTAL LIABILITIES 238,328 247,967 -4 % SHAREHOLDERS' EQUITY 26,363 21,264 24 % TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 264,691 $ 269,231 -2 % Book value per share $ 2.48 $ 2.00 REGULATORY CAPITAL RATIOS Leverage ratio 11.50 % 10.42 % Tier 1 risk-based capital ratio 16.06 % 14.07 % Total risk-based capital ratio 18.08 % 16.77 % ASSET QUALITY METRICS ALLL as a percentage of total loans and 1.97 % 2.47 % leases Non-performing assets as a percentage of 0.97 % 2.38 % total assets Non-performing assets as a percentage of 8.64 % 25.03 % total equity + ALLL (Texas ratio) Contact: NorCal Community Bancorp Steve Andrews, 510-748-8468 www.norcalcommunitybancorp.net
NorCal Community Bancorp Reports First Quarter Earnings, Announces Reversal of Valuation Allowance on Deferred Tax Assets as of
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