CommerceWest Bank (OTCBB: CWBK)
Financial performance highlights for the nine months ended
September 30, 2008:
-- Net income of $1,973,000 for the nine months ended September 30, 2008
or $0.62 per basic common share and $0.60 per diluted common share
-- Allowance for loan losses as a percent of total loans of 1.65%, up 17%
year over year
-- Return on assets of 1.08%
-- No exposure to FNMA or FHLMC preferred stock
-- "Well" capitalized as designated by regulatory agencies
Selected Financial Data For the Three Months Ended
Sept 30, June 30,
(dollars in thousands) 2008 2008
----------- -----------
Interest income 3,292 3,455
Interest expense 840 868
Net interest income 2,452 2,587
Provision for loan losses 295 310
Net earnings 549 703
Gross nonperforming loans as a % of total loans 0.67% 0.51%
Net interest margin 4.42% 4.42%
CommerceWest Bank (OTCBB: CWBK) reported earnings for the three
months ended September 30, 2008 of $549,000 or $0.17 per basic
common share and $0.17 per diluted common share, compared with net
income of $907,000 or $0.29 per basic common share and $0.27 per
diluted common share for the three months ended September 30, 2007.
Net income for the three months ended June 30, 2008 was $703,000 or
$0.22 per basic common share and $0.21 per diluted common share.
Net income for the nine months ended September 30, 2008 of
$1,973,000 or $0.62 per basic common share and $0.60 per diluted
common share, compared with net income of $2,473,000 or $0.78 per
basic common share and $0.73 per diluted common share for the nine
months ended September 30, 2007.
"We are pleased to announce another solid quarter. The Bank
continues to outperform its peer group. We are positioned well in
this unprecedented economic environment to grow our client base by
assisting businesses today who are experiencing issues with their
current banking relationships," said Chairman and CEO Ivo A. Tjan.
"Management is focused on maintaining strong credit quality, net
interest margin, and optimal efficiency by executing our proven
business model. The Bank has been very deliberate about its growth
strategy over the last several quarters. We believe now is the time
to pursue growth in market share. Despite the economy, we believe
the next several quarters will present some good opportunities for
the bank to grow its client base."
"The Bank has substantial capital to weather the current
economic turbulence," commented Chairman and CEO Ivo Tjan. "The
Bank's Board and Management are committed to creating long term
shareholder value."
Interest income was $3,292,000 for the three months ended
September 30, 2008 as compared to $4,054,000 for the three months
ended September 30, 2007, a decrease of 19%. Net interest income
before provision for loan losses for the three months ended
September 30, 2008 was $2,452,000, a decrease of $254,000 or 9%,
compared to the same period in 2007. This decrease resulted from a
$762,000 decrease in interest income offset by a $508,000 decrease
in interest expense. Interest income was $10,663,000 for the nine
months ended September 30, 2008 as compared to $11,968,000 for the
nine months ended September 30, 2007, a decrease of 11%. Net
interest income before provision for loan losses for the nine
months ended September 30, 2008 was $7,731,000, a decrease of
$145,000 or 2%, compared to the same period in 2007. This decrease
resulted from a $1,305,000 decrease in interest income offset by a
$1,160,000 decrease in interest expense.
The net interest margin for the three months ended September 30,
2008 was 4.42% as compared to 5.05% for the three months ended
September 30, 2007 a 63 basis point or 13% decrease. The net
interest margin for the three months ended September 30, 2008 was
unchanged from the second quarter of 2008. The net interest margin
for the nine months ended September 30, 2008 was 4.48% as compared
to 4.93% for the nine months ended September 30, 2007 a 45 basis
point or 9% decrease.
Provision for loan losses for the three months ended September
30, 2008 was $295,000 compared to $39,000 for the three months
ended September 30, 2007, an increase of 656%. Provision for loan
losses for the three months ended September 30, 2008 decreased 5%
compared to the three months ended June 30, 2008. Provision for
loan losses for the nine months ended September 30, 2008 was
$875,000 compared to $312,000 for the nine months ended September
30, 2007, an increase of 180%. The Bank's allowance for loan losses
was $2.3 million on September 30, 2008, up 14% from September 30,
2007. The Bank's allowance for loan losses as a percent of total
loans was 1.65% on September 30, 2008 as compared to 1.41% on
September 30, 2007, an increase of 17%. The Bank's allowance for
loan losses as a percent of total loans was 1.67% on June 30,
2008.
Non-interest income for the three months ended September 30,
2008 was $453,000 compared to $516,000 for the same period last
year, a decrease of 12%. Non-interest income for the three months
ended September 30, 2008 decreased 13% from the three months ended
June 30, 2008. Non-interest income for the nine months ended
September 30, 2008 was $1,481,000 compared to $1,565,000 for the
same period last year, a decrease of 5%. Non-interest expense for
the three months ended September 30, 2008 was $1,776,000 compared
to $1,738,000 for the same period last year, an increase of 2%.
Non-interest expense for the three months ended September 30, 2008
increased 3% from the three months ended June 30, 2008.
Non-interest expense for the nine months ended September 30, 2008
was $5,330,000 compared to $5,231,000 for the same period last
year, an increase of 2%.
Total asset growth as of September 30, 2008 was $5.7 million, an
increase of 2% as compared to the prior period. Total investment
securities growth as of September 30, 2008 was $12.7 million, an
increase of 19% over the prior period. Total loans decreased $4.5
million as of September 30, 2008, a decrease of 3%. Total deposits
decreased $4.1 million as of September 30, 2008, a decrease of 2%
from September 30, 2007. Stockholders' equity as of September 30,
2008 was $33.6 million, an increase of 7% as compared to September
30, 2007.
Return on assets was 1.08% for the nine months ended September
30, 2008 compared to 1.45% for the nine months ended September 30,
2007, a decrease of 26%. Return on equity was 7.87% for the nine
months ended September 30, 2008 compared to 11.07% for the nine
months ended September 30, 2007, a decrease of 29%.
The Bank's efficiency ratio for the three months ended September
30, 2008 was 61.15% compared to 53.92% in 2007, which represents an
increase of 13%. The Bank's efficiency ratio for the nine months
ended September 30, 2008 was 58.04% compared to 55.41% in 2007,
which represents an increase of 5%. The efficiency ratio
illustrates, that for every dollar the Bank made for the nine month
period ending September 30, 2008, the Bank spent $0.58 to make it,
as compared to $0.55 one year ago.
CommerceWest Bank is headquartered at 2111 Business Center Drive
in Irvine, CA, with Regional Offices in Orange County at 4685
MacArthur Court in Newport Beach, CA, in the Inland Empire at 1611
Pomona Road in Corona, CA, in Los Angeles at 19300 South Hamilton
Avenue in Gardena, CA. We offer a wide range of commercial banking
services, including, concierge services, remote deposit solution,
full-service internet banking, lines of credit, term loans,
commercial real estate lending, SBA lending, full cash management
and treasury management.
Mission Statement: CommerceWest Bank will create a complete
banking experience for each client, catering to businesses and
their specific banking needs, while accommodating our clients and
providing them high-quality, low stress and personally tailored
banking and financial services.
Please visit www.cwbk.com to learn more about the bank. "BANK ON
THE DIFFERENCE"
Statements concerning future performance, developments or
events, expectations for growth and income forecasts, and any other
guidance on future periods, constitute forward-looking statements
that are subject to a number of risks and uncertainties. Actual
results may differ materially from stated expectations. Specific
factors include, but are not limited to, loan production, balance
sheet management, expanded net interest margin, the ability to
control costs and expenses, interest rate changes, financial
policies of the United States government and general economic
conditions. The Company disclaims any obligation to update any such
factors or to publicly announce the results of any revisions to any
forward-looking statements contained in this release to reflect
future events or developments.
THIRD QUARTER REPORT - SEPTEMBER 30, 2008 (Unaudited)
BALANCE SHEET September 30, Increase
(dollars in thousands) 2008 2007 (Decrease)
------- ------- ----------
ASSETS
Cash and due from banks 8,094 7,449 9%
Securities 78,115 65,415 19%
Federal funds sold 355 4,210 -92%
Loans 139,405 143,944 -3%
Less allowance for loan losses (2,309) (2,027) 14%
------- -------
Loans, net 137,096 141,917 -3%
Bank premises and equipment, net 768 885 -13%
Other assets 10,903 9,736 12%
------- -------
Total assets 235,331 229,612 2%
======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Non-interest bearing deposits 61,821 73,288 -16%
Interest bearing deposits 125,413 118,092 6%
------- -------
Total deposits 187,234 191,380 -2%
Total borrowings 13,441 5,500 144%
Other liabilities 1,103 1,488 -26%
------- -------
201,778 198,368 2%
Stockholders' equity 33,553 31,244 7%
------- -------
Total liabilities and stockholders'
equity 235,331 229,612 2%
======= =======
STATEMENT OF EARNINGS
(dollars in For the Three For the Nine
thousands except Months Ended Months Ended
share and per Sept 30, Sept 30, Increase Sept 30, Sept 30, Increase
share data) 2008 2007 (Decrease) 2008 2007 (Decrease)
-------- -------- ------- -------- -------- -------
Interest income 3,292 4,054 -19% 10,663 11,968 -11%
Interest expense 840 1,348 -38% 2,932 4,092 -28%
-------- -------- -------- --------
Net interest
income 2,452 2,706 -9% 7,731 7,876 -2%
Provision for loan
losses 295 39 656% 875 312 180%
Other non-interest
income 453 516 -12% 1,481 1,565 -5%
Other non-interest
expense 1,776 1,738 2% 5,330 5,231 2%
-------- -------- -------- --------
Earnings before
income taxes 834 1,445 -42% 3,007 3,898 -23%
Income taxes 285 538 -47% 1,034 1,425 -27%
-------- -------- -------- --------
Net earnings 549 907 -39% 1,973 2,473 -20%
======== ======== ======== ========
Basic earnings per
share $ 0.17 $ 0.29 -41% $ 0.62 $ 0.78 -21%
Diluted earnings
per share $ 0.17 $ 0.27 -37% $ 0.60 $ 0.73 -18%
Return on Assets
(annualized) 0.93% 1.61% 1.08% 1.45%
Return on Equity
(annualized) 6.46% 11.76% 7.87% 11.07%
Efficiency Ratio 61.15% 53.92% 58.04% 55.41%
Gross nonperforming
loans as a % of
total loans 0.67% 0.15%
Bank Contact CommerceWest Bank, N.A. Mr. Ivo A. Tjan, CEO
Telephone: (949) 251-6959 Facsimile: (949) 251-6957 E-mail: Email
Contact or Email Contact Website: www.cwbk.com "Bank on the
Difference"
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