PBNK Pinnacle Bank (QB)

PBNK.OB - Pinnacle Bank, headquartered in Gilroy, California, announced today net income for 2012 was $190,000 compared to $551,000 in 2011. The 2012 provision for loan losses was $1,438,000, an increase of $1,205,000 from $233,000 in 2011. Pre-provision, pre-tax earnings of $1,655,000 for 2012 compared to $784,000 in 2011.

As of December 31, 2012, total assets were $170.2 million, a 10% increase from the $154.9 million at December 31, 2011.

Loans were $138.0 million at December 31, 2012, a 5% increase or $6.2 million from the December 31, 2011, balance of $131.8 million. The allowance for loan losses at December 31, 2012, was $3.6 million or 2.6% of loans compared to $2.8 million or 2.1% at December 31, 2011.

Non-interest bearing deposits at December 31, 2012, increased 37% to $49.0 million from $35.7 million at December 31, 2011. Total deposits at December 31, 2012, were $152.5 million compared to $137.7 million at December 31, 2011, an 11% increase.

“We had a very strong year in 2012 with double digit asset growth and revenue at an all time high. We are also proactively and aggressively addressing a small number of loans made early in the Bank’s history which were adversely impacted by the recession. Reducing the carrying values of these loans led to the increase in the provision for loan losses,” stated Susan K. Black, President and CEO. “Despite the impact on earnings, we believe these writedowns strengthen our balance sheet and provide a solid footing for 2013. In addition, substantial recoveries are possible.”

“We are pleased by growth in loans and deposits during 2012 as we execute our strategy of increasing franchise value by careful controlled growth. We are particularly pleased with the growth in core business banking relationships as reflected by the 37% growth in non-interest bearing deposits,” added Ms. Black. “Despite margin compression and competitive pressures, we are building a solid franchise and remain optimistic about future opportunities.”

The bank’s capital position remains above regulatory guidelines for well capitalized banks. At December 31, 2012, the Bank had a total risk based capital ratio of 11.74%.

About Pinnacle Bank

Pinnacle Bank is a full-service business bank dedicated to providing quality depository and credit services in Santa Clara, San Benito and Monterey counties. The bank focuses on commercial banking services for small to medium-sized businesses, offering a variety of products and services that combine the best of personal touch with convenient technology-based delivery. Pinnacle Bank has locations in Morgan Hill, Gilroy and Salinas. For more information please go to www.pinnaclebankonline.com click on Investor Relations and December 2012 call report.

Forward-Looking Statements

This release may contain forward-looking statements, such as, among others, statements about plans, expectations and goals concerning growth and improvement. Forward-looking statements are subject to risks and uncertainties. Such risks and uncertainties may include, but are not necessarily limited to fluctuations in interest rates, inflation, government regulations and general economic conditions, including the real estate market in our primary service area and more generally in California and other factors beyond the Bank's control. Such risks and uncertainties could cause results for subsequent interim periods or for the entire year to differ materially from those indicated. Readers should not place undue reliance on the forward-looking statements, which reflect management's view only as of the date hereof. Pinnacle Bank undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances.

        Summary Balance Sheet (Unaudited, dollars in thousands) 12/31/2012 12/31/2011

 

$ Change

% Change Total assets $ 170,195 $ 154,911 $ 15,284 10 % Gross loans 138,018 131,800 6,218 5 % Allowance for loan losses (3,611 ) (2,771 ) (840 ) 30 % Deposits Non-interest bearing 48,961 35,675 13,286 37 % Interest-bearing 103,519 102,042 1,477 1 % Total deposits 152,480 137,717 14,763 11 % Shareholders' equity 16,627 16,382 245 1 %

 

Summary Income Statement (Unaudited, dollars in thousands Year ended Year ended except per share data) 12/31/2012 12/31/2011

 

$ Change

% Change Interest income $ 7,356 $ 7,268 $ 88 1.2 % Interest expense 497 753 (256 ) -34.0 % Net interest income 6,859 6,515 344 5.3 % Provision for loan losses 1,438 233 1,205 517.2 % Non-interest income 824 597 227 38.0 % Non-interest expense 6,028 6,328 (300 ) -4.7 % Income tax expense 27 0 27 Net income (loss) $ 190 $ 551 $ (361 ) -65.5 %   Basic earnings per share $ 0.06 $ 0.20 Diluted earnings per share $ 0.04 $ 0.20   Income before provision and taxes $ 1,655 $ 784 $ 871 111.1 % Net interest margin 4.54 % 4.50 %             Minimum required to be Capital Ratios 12/31/2012     12/31/2011     well-capitalized Tier 1 leverage ratio 9.80% 10.11% 5.00% Tier 1 risk-based capital ratio 10.47% 11.18% 6.00% Total risk-based capital ratio 11.74% 12.43% 10.00%