California Center Bank Announces Another Strong Fourth-Quarter Earnings; Year-End Income Up 63%.Business Editors LOS LOS Length of stay, see there ANGELES--(BUSINESS WIRE)--Feb. 1, 2001 California California (kăl'ĭfôr`nyə), most populous state in the United States, located in the Far West; bordered by Oregon (N), Nevada and, across the Colorado River, Arizona (E), Mexico (S), and the Pacific Ocean (W). Center Bank (OTCBB OTCBB See OTC Bulletin Board (OTCBB). :CLFC CLFC Creating Lasting Family Connections (New Hampshire) CLFC Clear Lake Fencing Club (Texas) .OB) (CCB CCB Calcium channel blocker, see there ) today announced strong fourth-quarter 2000 net income of $2.2 million, reaching $8.4 million for the year 2000. Net income per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. common share rose 28.3% to $0.77 for the fourth quarter compared to $0.60 for the same period of 1999. Fully diluted income of $2.99 per share in 2000 represents a 64.3% increase from that of $1.82 per share in 1999. All per share results reflected the 13% stock dividend paid to shareholders on March 15, 2000. Year-End year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. Comparisons During the year ended Dec. 31, 2000, pretax income pretax income Reported income before the deduction of income taxes. Pretax income is sometimes considered a better measure of a firm's performance than aftertax income because taxes in one period may be influenced by activities in earlier periods. was $13.7 million. This was an increase of 66.9%, or $5.5 million over 1999. During 2000, CCB achieved a record high in its return on average stockholders' equity Stockholders' Equity The portion of the balance sheet that includes capital received from investors in exchange for stock (paid-in capital), donated capital, and retained earnings. This is equal to total assets minus liabilities, preferred stock and intangible assets. of 21.5%, compared with 15.8% in 1999. Return on average assets was 2.1% in 2000 and 2.2% for 1999. The decrease in return on average assets in 2000 was due to a significant increase in total assets. The bank's efficiency ratio was 52.9% in 2000 compared with 61.8% in 1999. As of Dec. 31, 2000, total assets were $449 million and stockholders' equity was $42.9 million. This compares with total assets of $353.6 million and shareholders' equity Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. of $35.1 million as of Dec. 31, 1999. President Seon Hong n. 1. A mercantile establishment or factory for foreign trade in China, as formerly at Canton; a succession of offices connected by a common passage and used for business or storage. Kim Kim orphan wanders streets of India with lama. [Br. Lit.: Kim] See : Adventurousness commented, "We are pleased to report our outstanding profitability in the context of our achievements in terms of growth and new marketing initiatives." The bank's strong earnings performance, combined with a previously announced stock repurchase Stock repurchase A firm's repurchase of outstanding shares of its common stock. program, resulted in a substantial increase in net income per basic share of $3.14 during the year ended Dec. 31, 2000, compared with $1.91 in 1999. Fourth-Quarter Comparisons Fourth-quarter 2000 net income before taxes was $3.6 million, an increase of 33.8%, or $906,000 over the same period in 1999. The efficiency ratio improved to 55.6% during the quarter compared to 58.4% for the same period last year. Return on average assets rose to 1.98% in the quarter compared with 1.66% for the same period in 1999. Return on average equity rose to 20.8% in the quarter compared with 16.7% for the same quarter of 1999, a 24.5% improvement. Operating Results Net interest income was $21.2 million in the year ended Dec. 31, 2000, a $6.2 million, or 40.9% increase compared with the same period of last year. Net interest income was $5.8 million in the fourth quarter of 2000 compared to $4.5 million in the same quarter last year. For both periods, the increase in net interest income was the principle contributor to the bank's higher net income in 2000. Both higher yields on earning assets Earning Assets Any income-earning asset owned by a company. Notes: These assets are generally interest-bearing accounts, bonds, and securities available for sale. See also: Asset, Asset Valuation, Earnings, Net Interest Margin as a result of increases in prime and fed funds fed funds See federal funds. interest rates, and an increase in loans, contributed to the increase in net interest income. The bank's net interest margin rose to 5.92% during the year from 5.38% in 1999. Increases in non-interest income were driven by increases in service charge income and international banking service fees from the International Department. Service charges related to deposit accounts were $4.7 million, or 52.4% of total non-interest income during 2000. The International Department, the leading provider of trade finance services in the community, earned $3 million, or 34.5% of non-interest income for the year. Kim stated, "We are especially proud of the International Department's contribution, which helps to distinguish us as having one of the highest levels of recurring re·cur intr.v. re·curred, re·cur·ring, re·curs 1. To happen, come up, or show up again or repeatedly. 2. To return to one's attention or memory. 3. To return in thought or discourse. non-interest income among community banks." Non-interest expense rose $1.4 million, or 9.5% for the year ended Dec. 31, 2000, compared to the same period of last year. The increase was mainly due to an increase of $1.0 million in salaries and employee benefits in 2000. Excluding salaries and employee benefits, overhead expenses only increased $389,000, or 2.6% over the prior year. The bank's efficiency ratio was 52.9% for the year 2000 and 61.8% for the same period in 1999. Kim commented, "The bank continues to explore ideas for further cost savings through its `Smart Spending' expense management program." Asset Growth The bank experienced strong asset growth in 2000. Total assets as of Dec. 31, 2000, stood at $449.4 million, a 27.1% increase from $353.6 million as of Dec. 31, 1999. As of year-end 2000 compared with year-end 1999, loans, net of unearned income Unearned Income Any income that comes from investments and other sources unrelated to employment services. Notes: Examples of unearned income include interest from a savings account, bond interest, tips, alimony, and dividends from stock. and the allowance for losses, increased by $70.3 million, or 30.5%, to $300.9 million; total deposits grew $85.2 million, or 27.4%, to $395.9 million from $310.7 million; and stockholders' equity increased by $7.8 million, or 22.2%, to $42.9 million. Even after the loan growth of 30.5% over the prior year, the bank's loan-to-deposit ratio remained at less than 80% and was well in line with its peer group. As of year-end 2000, California Center Bank's average non-interest-bearing deposits are approximately 34 percent of its average total deposits. This level of core non-interest-bearing relationship deposits is among the highest levels in its community. During 2000, the bank opened a new branch in the Inland Empire In·land Empire A region of the northwest United States between the Cascade Range and the Rocky Mountains, comprising eastern Washington, eastern Oregon, northern Idaho, and western Montana. Farming, lumbering, and mining are important to the area. . The new branch principally serves residential and small-business customers in the vicinity. After four months of operations, the new branch has now reached $4.3 million in total deposits, of which approximately 21.9% are non-interest bearing. During the year, in addition to the Inland Empire branch, the bank also opened two loan production offices in Seattle Seattle (sēăt`əl), city (1990 pop. 516,259), seat of King co., W Wash., built on seven hills, between Elliott Bay of Puget Sound and Lake Washington; inc. 1869. and Phoenix. Kim stated: "Our strategy is to enter selected areas where we see concentrations of our target customers through generally low break-even new business initiatives. These new offices have been both an important source of new funding and lending opportunities." To the extent proven by the bank's success in the Inland Empire, management expects to continue with this strategy in 2001. Assets Quality Non-performing assets (which include loans past due 90 days or more and still accruing interest, non-accrual loans and other real estate owned Real Estate Owned Property owned by a lender - usually a bank - after an unsuccessful sale at a foreclosure auction. This is common because most of the properties up for sale at these auctions are worth less than the total amount owed to the bank: the minimum bid in most ), as a percentage of total loans plus other real estate owned, decreased to 0.36% as of Dec. 31, 2000, from 0.71% at year-end 1999. The bank's disposal of all other real estate owned also helped to lower the ratio. Non-accrual loans decreased slightly to $1,123,000 during the year, and its ratio to gross loans decreased also to 0.36% as of Dec. 30, 2000, from 0.48% as of Dec. 31, 1999. The bank provided $500,000 for loan loss reserves during the year and recorded net charge-offs of $428,000. The balance of the allowance for loan losses was $6.63 million as of Dec. 31, 2000, compared with $6.56 million at year-end 1999. As of year-end 2000, the allowance for loan losses was 2.15% of total gross loans, lower than the year-end 1999 ratio of 2.76% but much higher than its peers. No provision for loan losses was declared in the last quarter of 2000 due to more than a sufficient level of loan loss reserve, 590.65% of non-performing assets. In addition, the ratio of allowance for loan losses to gross loans was 2.15% at Dec. 31, 2000, which was significantly higher than its peers. Capital Adequacy As of Dec. 31, 2000, the bank's Total capital, Tier 1 capital Tier 1 Capital A term used to describe the capital adequacy of a bank. Tier I capital is core capital, this includes equity capital and disclosed reserves. Notes: Equity capital includes instruments that can't be redeemed at the option of the holder. and Tier 1 leverage capital ratios were 14.82%, 13.56%, and 9.87%, respectively. These levels place the bank in the "well capitalized Capitalized Recorded in asset accounts and then depreciated or amortized, as is appropriate for expenditures for items with useful lives longer than one year. " category under regulatory guidelines guidelines, n.pl a set of standards, criteria, or specifications to be used or followed in the performance of certain tasks. and provide a sound base for additional growth. As previously announced, the bank may repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. up to 10% of its common shares in open-market transactions Open-Market Transaction An order placed by an insider, after all appropriate documentation has been filed, to buy or sell restricted securities openly on an exchange. Notes: . As of Dec. 31, 2000, a total of 71,500 shares, approximately 3% of total outstanding shares, were repurchased at an average cost of $19.08 per share. The bank's Stock Repurchase Program is subject to various applicable regulatory guidelines including those relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the amount of current year's retained earnings Retained Earnings The percentage of net earnings not paid out in dividends, but retained by the company to be reinvested in its core business or to pay debt. It is recorded under shareholders equity on the balance sheet. . The bank also recently announced a two-for-one stock split with a record date of Jan. 18, 2001, and a payable date of on or about Feb. 8, 2001. California Center Bank is a community bank located in Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. . The bank was founded in March 1986 and offers a full range of financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. . It specializes in commercial and SBA SBA abbr. Small Business Administration Noun 1. SBA - an independent agency of the United States government that protects the interests of small businesses and ensures that they receive a fair share of government loans and trade finance products for multi-ethnic Adj. 1. multi-ethnic - involving several ethnic groups multiethnic social - living together or enjoying life in communities or organized groups; "a human being is a social animal"; "mature social behavior" and small-business customers. The bank now operates six branches throughout Southern California Southern California, also colloquially known as SoCal, is the southern portion of the U.S. state of California. Centered on the cities of Los Angeles and San Diego, Southern California is home to nearly 24 million people and is the nation's second most populated region, and two Loan Production Offices. The bank's mission is to maximize its return to shareholders by remaining a strong, independent, highly profitable and growth-oriented provider of financial services, distinguishing itself through its multi-ethnic focus, trade finance services, and high-touch, customized and timely service. Further details about the bank can be found at its Web site, www.calcenterbank.com. The bank wishes to take advantage of the "Safe-Harbor" provisions of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995 as to "forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. " statements in this release that are not historical facts. The bank's actual results may differ materially from those expressed in any forward-looking statement forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. made in this release.
California Center Bank
Condensed Statements of Financial Condition (Unaudited)
(In thousands, except share and per share data)
As of
12/31/00 12/31/99 9/30/00
Assets
Cash and due from banks 28,832 16,450 26,240
Federal funds sold 19,200 24,000 16,900
Securities available-for-sale 46,341 32,847 34,364
Securities held-to-maturity 34,197 34,114 34,108
Loans (net of unearned income) 307,546 237,187 291,878
Allowance for loan losses (6,633) (6,561) (6,788)
Net loans 300,913 230,626 285,090
Other real estate owned 0 546 0
Fixed assets 6,548 6,258 6,467
Other assets 13,406 8,740 12,829
Total Assets 449,437 353,581 415,998
Liabilities and Stockholders' Equity
Non-interest-bearing deposits 124,635 109,599 124,224
Interest-bearing deposits 271,303 201,142 240,032
Total deposits 395,938 310,741 364,256
Other liabilities 10,590 7,704 11,425
Total liabilities 406,528 318,445 375,681
Stockholders' equity 42,909 35,136 40,317
Total liabilities &
stockholders' equity 449,437 353,581 415,998
Book value per share (a) $ 16.28 $ 13.01 $ 15.29
Number of common shares
outstanding at period end (a) 2,636,107 2,699,184 2,636,107
(a) adjusted to reflect stock dividends
California Center Bank
Condensed Statements of Income and Comprehensive Income (Unaudited)
(In thousands, except share and per share data)
Quarter Ended Year Ended
Dec. 31, Dec. 31,
2000 1999 2000 1999
Interest income 9,427 6,564 32,938 22,244
Interest expense 3,656 2,072 11,697 7,174
Net interest income 5,771 4,492 21,241 15,070
Provision for loan losses 0 150 500 804
Net interest income after
provision for loan losses 5,771 4,342 20,741 14,266
Non-interest income 2,302 2,290 8,932 8,525
Salaries and employee benefits 2,596 2,342 9,646 8,644
Occupancy and furniture and
fixture expenses 434 383 1,510 1,450
Other non-interest expenses 1,460 1,230 4,813 4,484
Non-interest expenses 4,490 3,955 15,969 14,578
Income before income tax 3,583 2,677 13,704 8,213
Income taxes 1,425 979 5,301 3,067
Net income 2,158 1,698 8,403 5,146
Other comprehensive income (a) 434 (174) 629 (578)
Total comprehensive income 2,592 1,524 9,032 4,568
Income per share, basic (b) 0.80 0.63 3.14 1.91
Income per share, diluted (b) 0.77 0.60 2.99 1.82
Basic average common
shares outstanding (b) 2,683,286 2,698,553 2,679,659 2,698,553
Diluted average common
shares outstanding (b) 2,799,653 2,830,827 2,814,324 2,830,827
(a) Comprehensive income represents the unrealized gains (losses) on
securities available for sale.
(b) Adjusted to reflect stock dividends.
California Center Bank
Selected Financial Ratios (Unaudited)
Quarter Ended Year Ended
Dec. 31, Dec. 31,
2000 1999 2000 1999
Return on Average Assets 1.98% 1.66% 2.14% 2.22%
Return on Average Equity 20.77% 16.68% 21.53% 15.80%
Net interest margin 5.79% 5.65% 5.93% 5.41%
Efficiency ratio 55.62% 58.32% 52.92% 61.78%
Selected Financial Information (Unaudited)
(In thousands)
As of 12/31/00 12/31/99 Change
Loans
Commercial 135,826 110,661 23%
Residential mortgage 4,047 3,741 8%
Commercial mortgage 142,844 105,370 36%
Real estate construction 1,276 3,604 -65%
Installment 23,921 12,529 91%
Other 32 1,751 -98%
Total loans - gross 307,946 237,656 30%
Unamortized deferred loan fees (400) (469) -15%
Allowance for loan losses (6,633) (6,561) 1%
Total loans - net 300,913 230,626 30%
Deposits
Non-interest bearing 124,635 109,599 14%
Interest-bearing checking 52,269 58,185 -10%
Savings 20,849 21,570 -3%
Time deposits 198,185 121,387 63%
Total deposits 395,938 310,741 27%
Non-performing assets
Loans past due 90 days or more
and still accruing interest 0 5
Non-accrual loans 1,123 1,147
Total non-performing loans 1,123 1,152
Other real estate owned -- 546
Total non-performing assets 1,123 1,698
Allowance for Loan Losses
Balance as of Jan. 1, 2000 $ 6,561
Provision for Loan Losses 500
Charge-offs (net of recoveries) (428)
Balance as of Sept. 30, 2000 $ 6,633
As of 12/31/00 12/31/99
Selected Ratio
Non-accrual loans to gross loans 0.36% 0.48%
Non-performing assets to total loans
and OREO to total assets 0.36% 0.71%
Allowance for loan losses to gross loans 2.15% 2.76%
Allowance for loan losses to non-performing loans 590.65% 569.53%
Total risk-based capital ratio 14.82% 16.40%
Tier 1 risk-based capital ratio 13.56% 15.13%
Tier 1 capital ratio 9.87% 10.32%
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