Community West Bancshares Earns $2.6 Million in Third Quarter Highlighted by 26% Decline in Nonaccrual Loans

Community West Bancshares Earns $2.6 Million in Third Quarter Highlighted by
26% Decline in Nonaccrual Loans

GOLETA, Calif., Oct. 24, 2013 (GLOBE NEWSWIRE) -- Community West Bancshares
(Community West or the Company), (Nasdaq:CWBC), parent company of Community
West Bank (Bank), today reported net income increased to $2.6 million in the
third quarter of 2013 (3Q13) compared to $2.1 million in the second quarter of
2013 (2Q13) and $613,000 in the third quarter a year ago (3Q12). In the first
nine months of the year, Community West earned $5.9 million compared to
$841,000 in the first nine months of 2012.

"Our third quarter results marked our fifth consecutive quarter of
profitability, and showed meaningful progress with credit quality
improvements, and continued net interest margin expansion," stated Martin E.
Plourd, President and Chief Executive Officer. "Nonaccrual loans were down 26%
compared to three months earlier, and our capital ratios continue to
strengthen. As we look forward, we continue to focus on growing lending,
strengthening operations and increasing our marketing outreach in the
communities we serve."

3Q13 Financial Highlights

  *Net income of $2.6 million.
  *Earnings of $0.29 per diluted share.
  *Net interest margin expanded to 4.89% in 3Q13, an eight basis point
    improvement compared to 4.81% in 2Q13 and a 24 basis point improvement
    compared to 4.65% in 3Q12.
  *Nonaccrual loans declined 26.1% to $15.3 million at September 30, 2013,
    compared to $20.7 million at June 30, 2013 and decreased 54.2% compared to
    $33.3 million at September 30, 2012.
  *Net real estate owned (REO) and repossessed assets, excluding USDA/SBA
    guarantees, totaled $1.7 million at September 30, 2013, compared to $1.5
    million three months earlier and $3.8 million a year earlier.
  *The total allowance for loan losses equaled 3.01% of total loans held for
    investment at September 30, 2013, compared to 3.14% at June 30, 2013 and
    3.65% a year ago.
  *Community West Bank's capital ratios continue to strengthen - Total
    risk-based capital ratio was 17.16% and Tier 1 leverage ratio was 12.06%
    at September 30, 2013. Both ratios are well above the minimum levels of
    12% and 9%, respectively, called for in the Bank's regulatory agreement.

Including $262,000 of dividends and accretion on preferred stock, the net
income available to common stockholders was $2.4 million, or $0.29 per diluted
share, in 3Q13 compared to $1.9 million, or $0.23 per diluted share, in 2Q13
and $360,000, or $0.06 per diluted share, in 3Q12. In the first nine months of
the year, including $786,000 of dividends and accretion on preferred stock,
the net income available to common stockholders was $5.1 million, or $0.60 per
diluted share, compared to $56,000, or $0.01 per diluted share, in the first
nine months of 2012. Book value per common share was $6.24 at September 30,
2013, compared to $5.98 at June 30, 2013 and $5.93 at September 30, 2012.

Credit Quality

"Our asset quality continues to strengthen on virtually every metric, with
nonaccrual loans, REO and repossessed assets and net loan charge-off levels
all declining compared to the prior quarter end," said Plourd. "Recoveries on
several previously charged-off loans totaling $1.5 million, as well as
substantial reserves already in place, allowed us to release $1.6 million in
reserves in the third quarter, bringing the released reserve provision for the
first nine months of 2013 to $2.8 million. Of the release, net loan recoveries
for 3Q13 were $761,000.This compares to a $1.3 million increase in the
reserve recorded in 3Q12 and a $5.2 million increase to the reserve recorded
in the first nine months of 2012."

The allowance for loan losses totaled $11.7 million at September 30, 2013,
equal to 3.01% of total loans held for investment, compared to 3.14% at June
30, 2013 and 3.65% a year ago.

Nonaccrual loans improved 26.1% to $15.3 million, or 3.39% of total loans at
September 30, 2013 compared to $20.7 million, or 4.48% of total loans, three
months earlier, and $33.3 million, or 7.01% of total loans, a year ago.The
decrease in nonaccrual loans compared to the preceding quarter end was
primarily due to the continuing efforts to work with borrowers and achieving
successful resolutions, including payoffs and paydowns.The short-term effect
of this is to decrease total Company loans.

Of the $15.3 million in nonaccrual loans, $5.3 million (34.9%) were
manufactured housing loans, $3.2 million (20.8%) were commercial real estate
loans, $4.0 million (26.3%) were commercial loans, $1.5 million (10.1%) were
SBA loans, $693,000 (4.5%) were other installment loansand $522,000 (3.4%)
were home equity line of credit loans.

REO and repossessed assets stood at $4.0 million at September 30, 2013
compared to $4.1 million three months earlier and $3.8 million a year earlier.
This amount consists of $3.5 million in REO and $500,000 from repossessed
manufactured housing loans.REO consists of four properties for which $2.3
million is guaranteed by the SBA/USDA.Nonaccrual loans plus REO and
repossessed assets, net of SBA/USDA guarantees, totaled $17.0 million, or 3.2%
of total assets, at September 30, 2013 compared to $22.1million, or 4.1% of
total assets, three months earlier and $37.1 million, or 6.7% of total assets,
a year ago. 

Net charge-offs continued to improve with third quarter net loan recoveries of
$761,000, compared to net charge-offs of $410,000 in 2Q13 and net charge-offs
of $1.7 million in 3Q12. 

Income Statement

Community West's third quarter net interest income was $6.0 million compared
to $5.9 million in 2Q13 and $6.1 million in 3Q12.The third quarter net
interest margin improved eight basis points to 4.89%, compared to 4.81% in
2Q13 and expanded 24 basis points compared to 4.65% in 3Q12.In the first nine
months of the year, the net interest margin expanded 19 basis points to 4.82%
compared to 4.63% in the first nine months of 2012.

"Having a high-yielding mix of loan products and a deposit base that has more
than 72% in low-cost core deposits continues to keep our net interest margin
healthy and above peer levels," said Charles G. Baltuskonis, Executive Vice
President and Chief Financial Officer."Also, the debenture conversion near
the end of 2Q13 decreased the cost of funds for 3Q13 and going forward.Our
3Q13 net interest margin of 4.89% is well above the average for the SNL U.S.
Bank Index of 2.92% for 2Q13."

Non-interest income was $684,000 in 3Q13 compared to $802,000 in 2Q13 and $1.1
million in 3Q12.In the first nine months of 2013 non-interest income was $2.3
million compared to $3.5 million in the first nine months of 2012, which
included a $1.25 million gain on sale of SBA loans.

3Q13 operating or non-interest expenses stood at $5.6 million, the same as in
2Q13. In 3Q12 non-interest expenses were $5.3 million. Year-to-date
non-interest expenses were $16.9 million compared to $16.6 million in the
first nine months of 2012.Salaries and employee benefits increased due to the
additions to staff, primarily lenders and credit administration, and the 2013
payroll tax increase.

Balance Sheet

Mr. Plourd commented, "While net loan growth has been flat in recent quarters,
and down slightly due to moving several problem loans off the books, we are
encouraged by new loan originations in the pipeline."Net loans were $439.4
million at September 30, 2013 compared to $448.4 million at June 30, 2013 and
$459.9 million a year ago.Manufactured housing loans were down 4.4% from year
ago levels to $172.1 million and represent 38.2% of total loans. Commercial
real estate loans outstanding were down 3.8% from year ago levels to $132.0
million at September 30, 2013 and comprise 29.3% of the total loan portfolio.
SBA loans decreased 15.8% from a year ago to $74.3 million and represent
16.5% of the total loan portfolio and commercial loans increased 33.0% from
year ago levels to $45.6 million and represent 10.1% of the total loan
portfolio.

"Non-interest-bearing deposit accounts increased 4.4% compared to the prior
quarter end.We continue to change the deposit mix by focusing on growing low
cost deposits and letting higher cost interest-bearing certificates of deposit
run off," said Baltuskonis.

Non-interest-bearing deposit accounts increased 4.4% to $55.5 million at
September 30, 2013, compared to $53.1 million at June 30, 2013 and $54.5
million a year ago.Interest-bearing deposit accounts decreased to $254.0
million at the end of September, compared to $257.8 million at June 30, 2013
and $274.9 million a year ago.Total deposits were $431.1 million at September
30, 2013 compared to $434.9 million at June 30, 2013 and $460.0 million a year
ago.Core deposits, defined as non-interest-bearing checking, interest-bearing
checking, money market accounts, savings accounts and retail certificates of
deposit totaled $355.3 million at September 30, 2013 compared to $356.7
million at June 31, 2013, and $377.2 million a year ago.

Total assets were $535.5 million at September 30, 2013 compared to $536.1
million at June 30, 2013, and $556.8 million a year ago.Stockholders' equity
improved to $64.6 million at September 30, 2013, compared to $62.1 million at
June 30, 2012 and $50.8 million a year ago.Book value per common share
increased 4.3% to $6.24 at September 30, 2013, compared to $5.98 at the end of
June, and increased 5.2% compared to $5.93 a year earlier.

Company Overview

Community West Bancshares is a financial services company with headquarters in
Goleta, California.The Company is the holding company for Community West
Bank, which has five full-service California branch banking offices, in
Goleta, Santa Barbara, Santa Maria, Ventura and Westlake Village.The
principal business activities of the Company are Relationship banking,
Mortgage lending and SBA lending.

The Company is prohibited from paying dividends on its common or preferred
stock without the prior approval of the Federal Reserve Board (FRB).The FRB
has denied payment of the quarterly $195,000 dividend on the preferred shares
that were due from May 15, 2012 to August 15, 2013.Such amounts continue to
be accrued as incurred and deducted from capital.

Safe Harbor Disclosure

This release contains forward-looking statements that reflect management's
current views of future events and operations.These forward-looking
statements are based on information currently available to the Company as of
the date of this release.It is important to note that these forward-looking
statements are not guarantees of future performance and involve risks and
uncertainties, including, but not limited to, the ability of the Company to
implement its strategy and expand its lending operations.

COMMUNITY WEST BANCSHARES
CONDENSED CONSOLIDATED INCOME STATEMENTS
(unaudited)
(in 000's, except per share data)
                                                                
                             Three Months Ended           NineMonths Ended
                             September June 30, September September September
                              30,                30,       30,       30,
                             2013      2013     2012      2013      2012
                                                                
Interest income                                                  
Loans, including fees         $6,871  $6,850 $7,324  $20,515 $23,236
Investment securities and     187      175     188      532      631
other
Total interest income         7,058    7,025   7,512    21,047   23,867
Interest expense                                                 
Deposits                      719      760     970      2,238    3,287
Other borrowings and          328      401     433      1,136    1,386
convertible debt
Total interest expense        1,047    1,161   1,403    3,374    4,673
Net interest income           6,011    5,864   6,109    17,673   19,194
Provision for credit losses   (1,563)  (1,084) 1,293    (2,843)  5,176
Net interest income after     7,574    6,948   4,816    20,516   14,018
provision for credit losses
Non-interest income                                              
Other loan fees               229      385     302      844      847
Gains from loan sales, net    62       111     366      334      1,521
Document processing fees      114      145     109      369      283
Service Charges               75       85      98       245      327
Loan servicing, net           70       24      105      169      180
Other                         134      52      77       292      300
Total non-interest income     684      802     1,057    2,253    3,458
Non-interest expenses                                            
Salaries and employee         3,114    3,371   2,899    9,999    8,526
benefits
Occupancy expense, net        452      458     451      1,365    1,365
Loan servicing and collection 511      347     366      1,111    1,257
Professional services         308      290     372      913      993
FDIC assessment               283      261     311      809      1,046
Advertising and marketing     94       187     59       374      218
Depreciation                 78       74      78       226      231
Net loss on sales/write-downs
of foreclosed real estateand 168      22      189      274      969
repossessed assets
Data processing               128      125     127      403      407
Other                        487      489     408      1,445    1,623
Total non-interest expenses   5,623    5,624   5,260    16,919   16,635
Income before provision for   2,635    2,126   613      5,850    841
income taxes
Income tax expense            --       --      --       --       --
Net Income                    $2,635  $2,126 $613    $5,850  $841
Dividends and accretion on    262      262     253      786      785
preferred stock
Net income available to       $2,373  $1,864 $360    $5,064  $56
common stockholders
Earnings per share:                                              
Basic                         $0.30   $0.30  $0.06   $0.75   $0.01
Diluted                       $0.29   $0.23  $0.06   $0.60   $0.01
                                                                

COMMUNITY WEST BANCSHARES
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
(in 000's, except per share data)
                                                              
                             September 30, June 30,   September  December 31,
                                                       30,
                             2013          2013       2012       2012
                                                              
Cash and cash equivalents     $42,570     $34,072  $32,306  $27,891
Time and interest-earning
deposits in other financial   3,282        3,311     3,890     3,653
institutions
Investment securities         25,585       25,671    24,823    24,040
Loans:                                                         
Commercial                    45,623       42,658    34,291    37,266
Commercial real estate        132,034      138,393   137,230   126,676
SBA                           74,327       78,648    88,257    85,957
Manufactured housing          172,126      172,365   180,105   177,391
Single family real estate     10,011       9,873     9,953     9,945
HELOC                         15,616       17,036    19,018    17,852
Consumer                      186          195       250       232
Mortgage loans held for sale  1,088        1,526     5,733     8,223
Deferred fees                 88           112       156       123
Total loans                   451,099      460,806   474,993   463,665
                                                              
Loans, net                                                     
Held for sale                64,187       64,133    62,894    68,694
Held for investment          386,912      396,673   412,099   394,971
Less: Allowance              (11,654)     (12,456)  (15,055)  (14,464)
Net held for investment      375,258      384,217   397,044   380,507
NET LOANS                    439,445      448,350   459,938   449,201
                                                              
Other assets                  24,599       24,694    35,839    27,316
                                                              
TOTAL ASSETS                 $535,481    $536,098 $556,796 $532,101
                                                              
Deposits                                                       
Non-interest-bearing demand  $55,462     $53,124  $54,466  $53,605
Interest-bearing demand      253,978      257,785   274,894   269,466
Savings                      16,176       16,273    16,443    16,351
CDs over 100K                92,351       94,397    98,362    80,710
CDs under 100K               13,124       13,292    15,801    14,088
Total Deposits                431,091      434,871   459,966   434,220
Other borrowings              35,442       35,667    41,852    41,852
Other liabilities             4,300        3,474     4,165     2,980
TOTAL LIABILITIES            470,833      474,012   505,983   479,052
                                                              
Stockholders' equity          64,648       62,086    50,813    53,049
                                                              
TOTAL LIABILITIES AND         $535,481    $536,098 $556,796 $532,101
STOCKHOLDERS' EQUITY
                                                              
Shares outstanding            7,865        7,800     5,990     5,995
                                                              
Book value per common share   $6.24       $5.98    $5.93    $6.29
                                                              

ADDITIONAL FINANCIAL INFORMATION
(Dollars in thousands except per share amounts)(Unaudited)
                       Quarter    Quarter    Quarter    Nine Months Ended
                        Ended      Ended      Ended
PERFORMANCE MEASURES    Sep. 30,   Jun. 30,   Sep. 30,   Sep. 30,   Sep. 30,
AND RATIOS              2013       2013       2012       2013       2012
Return on average       21.91%     21.15%     6.89%      18.62%     4.72%
common equity
Return on average       1.95%      1.60%      0.43%      1.47%      0.28%
assets
Efficiency ratio        83.99%     84.37%     73.40%     84.91%     73.44%
Net interest margin     4.89%      4.81%      4.65%      4.82%      4.63%
                                                               
                       Quarter    Quarter    Quarter    Nine Months Ended
                        Ended      Ended      Ended
AVERAGE BALANCES        Sep. 30,   Jun. 30,   Sep. 30,   Sep. 30,   Sep. 30,
                        2013       2013       2012       2013       2012
Average assets          $535,552 $530,607 $564,609 $530,284 $593,091
Average earning assets  487,755   489,278   522,819   489,762   553,382
Average total loans     455,646   456,783   484,944   457,705   511,646
Average deposits        432,725   430,770   469,236   429,977   489,888
Average equity
(including preferred    63,214    55,632    50,796    57,439    50,789
stock)
Average common equity
(excluding preferred    47,716    40,201    35,564    42,007    35,632
stock)
                                                               
EQUITY ANALYSIS         Sep. 30,   Jun. 30,   Sep. 30,             
                        2013       2013       2012
Total equity            $64,648  $62,086  $50,813            
Less: senior preferred  15,542    15,475    15,275              
stock
Total common equity     $49,106  $46,611  $35,538            
                                                               
Common stock            7,866     7,800     5,990               
outstanding
Book value per common   $6.24    $5.98    $5.93              
share
                                                               
ASSET QUALITY           Sep. 30,   Jun. 30,   Sep. 30,             
                        2013       2013       2012
Nonaccrual loans        $15,277  $20,660  $33,320            
Nonaccrual loans/total  3.39%      4.48%      7.01%                
loans
REO and repossessed     $3,975   $4,100   $3,761             
assets
Less:
SBA/USDA-guaranteed     2,282      2,640      0                    
amounts
                                                               
Net REO and repossessed $1,693   $1,460   $3,761             
assets
Nonaccrual loans plus   16,970     22,120     37,081               
net REO
Nonaccrual loans plus   3.17%      4.13%      6.66%                
net REO/total assets
Net loan charge-offs in $(761)   $410     $1,684             
the quarter
Net charge-offs in the  -0.17%     0.09%      0.35%                
quarter/total loans
                                                               
Allowance for loan      $11,654  $12,456  $15,055            
losses
Plus: Reserve for
undisbursed loan        73        76        127                 
commitments
Total allowance for     $11,727  $12,532  $15,182            
credit losses
Total allowance for
loan losses/total loans 3.01%      3.14%      3.65%                
held for investment
Total allowance for
loan losses/nonaccrual  76.28%     60.29%     45.18%               
loans
                                                               
Community West                                                  
Bancshares
Tier 1 leverage ratio   12.10%     11.71%     8.98%                
Tier 1 risk-based       16.05%     15.00%     11.59%               
capital ratio
Total risk-based        17.68%     16.68%     14.66%               
capital ratio
                                                               
Community West Bank                                             
Tier 1 leverage ratio   12.06%     11.65%     9.84%                
Tier 1 risk-based       15.89%     14.83%     12.62%               
capital ratio
Total risk-based        17.16%     16.10%     13.89%               
capital ratio
                                                               
INTEREST SPREAD         Sep. 30,   Jun. 30,   Sep. 30,             
ANALYSIS                2013       2013       2012
Yield on
interest-bearing        0.76%      0.80%      0.93%                
deposits
Yield on total loans    5.98%      6.01%      6.01%                
Yield on investments    2.56%      2.40%      2.22%                
Yield on earning assets 5.74%      5.76%      5.72%                
                                                               
Cost of deposits        0.66%      0.71%      0.82%                
Cost of FHLB advances   2.93%      2.93%      2.93%                
Cost of
interest-bearing        1.01%      1.11%      1.22%                
liabilities

CONTACT: Charles G. Baltuskonis, EVP & CFO
         805.692.5821
         www.communitywestbank.com
 
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