Community West Bancshares Announces Earnings Increase of 9% for 2004 Third Quarter and 66% for 2004 Nine Months; Dividend of $.04 Per Share Declared.GOLETA, Calif. -- Community West Bancshares (Company)(Nasdaq:CWBC CWBC Constant-Weight Binary Code ) today announced operating results for the third quarter and first nine months of 2004. EARNINGS SUMMARY For the quarter ended September 30, 2004 (2004 Q 3), the Company recorded net income of $967,000, or $.17 per share (basic, and $.16 per share 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. ), compared to net income of $885,000, or $.16 per share (basic, and $.15 per share diluted), for the quarter ended September 30, 2003 (2003 Q 3). This represents a 9% comparative increase. For the nine months ended September 30, 2004, the Company recorded net income of $2,881,000, or $.50 per share (basic, and $.49 per share diluted), compared to net income of $1,731,000, or $.30 per share (basic and diluted) for the nine months ended September 30, 2003. This represents a 66% comparative increase. Net Interest Income Total interest income for the comparative three-month periods increased by $691,000. This increase is related to growth in interest-earning assets, primarily in the commercial lending and manufactured housing Manufactured housing (also known as prefab housing) is a type of housing unit that is largely assembled in factories and then transported to sites of use. In the United States, the term "manufactured home" specifically refers to a house built entirely in a protected portfolios, and was partially offset by the continued decrease in securitized securitized Of, related to, or being debt securities that are secured with assets. For example, mortgage purchase bonds are secured by mortgages that have been purchased with the bond issue's proceeds. loans. Interest expense on deposits was slightly higher based on volume and was more than offset by the decline in interest expense on the securitized bonds, as the Company continues to benefit from the paydowns of the relatively high-rate, securitized bonds, thus serving to reduce the Company's cost of funds Cost of Funds The interest rate paid on an outstanding loan. Notes: Money isn't free! Cost of funds is the cost of borrowing money. See also: Interest Rate Cost of funds Interest rate associated with borrowing money. . Provision for Loan Losses Overall, the general portfolio credit quality continues to be relatively stable and, in addition, the securitized loan portfolio continues to stabilize stabilize See peg. and pay down. Non-Interest Income and Non-Interest Expenses The comparative decrease in non-interest income was primarily due to a decrease in mortgage business and the selling of unguaranteed 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 in 2003 Q 3 and none in 2004 Q 3. These sales generally occur one or two times per year. Quarterly non-interest expenses were in total at a slightly lower level. BALANCE SHEET The Company's total assets increased to $347.2 million, or $43 million, at September 30, 2004 compared to $304.2 million at December 31, 2003. Net loans increased by $34.3 million and liquid assets Cash, or property immediately convertible to cash, such as Securities, notes, life insurance policies with cash surrender values, U.S. savings bonds, or an account receivable. , investment securities and FHLB FHLB Federal Home Loan Bank stock increased by $10.3 million. On the funding side in 2004, deposits have increased by $38.1 million while other borrowings have remained approximately the same in total, as the securitized debt repayments have effectively been replaced with short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. borrowings. CAPITAL As of September 30, 2004, the Company had $36,878,000 in equity capital, or 10.62% of consolidated total assets, and book value per share was $6.44. DIVIDEND DECLARED The Board of Directors announced that they have declared a quarterly dividend of $.04 per common share, payable November 22, 2004 to shareholders of record as of the close of business on November 8, 2004. At this quarterly rate, the annual dividend is equivalent to $.16 per common share. SANTA MARIA Santa Maria, city, Brazil Santa Maria (sän`tə mərē`ə), city (1991 pop. 217,592), Rio Grande do Sul state, S Brazil. It is a major railroad terminus and the site of an important military base. FULL-SERVICE BRANCH OFFICE The Company has signed a lease in Santa Maria and will soon commence work on its tenant improvements for the next full-service Community West Bank branch office location. The office is planned to open in the 2005 first quarter. The Santa Maria business market has undergone rapid growth in the last several years, and with a successful loan production office already there in place, the Company believes it is well positioned to participate in that growth. COMMENTS FROM PRESIDENT AND CHIEF EXECUTIVE OFFICER Lynda J. Nahra, President and Chief Executive Officer, noted: "We continue to be pleased with the Company's progress in 2004, especially in light of the continued difficult interest rate environment for the banking industry. We remain focused on our business model and core competencies A core competency is something that a firm can do well and that meets the following three conditions specified by Hamel and Prahalad (1990):
adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. operating results are a partial reflection of that growth, the fact that the Company's interest margin has stabilized sta·bi·lize v. sta·bi·lized, sta·bi·liz·ing, sta·bi·liz·es v.tr. 1. To make stable or steadfast. 2. and that we continue to successfully manage the credit portfolio." COMPANY OVERVIEW Community West Bancshares is a 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. company with headquarters in Goleta, California “Goleta” redirects here. For the genus of jumping spiders, see Goleta (spider). Goleta (IPA: /ɡəʊleta/ in English or /ɡolɛta/ in Spanish) is a city located in southern Santa Barbara County, California, USA. . The Company is the holding company for Community West Bank, formerly Goleta National Bank, which has two full-service branch offices, in Goleta and Ventura, and a loan production office (and will also have a full-service branch office in 2005) in Santa Maria, California Santa Maria is the largest city in Santa Barbara County, California. According to the California State Department of Finance, Santa Maria's estimated population surpassed Santa Barbara's with an estimated population of 90,518. . The principal business activities of the Company are Relationship banking, Mortgage lending and SBA lending, with loans originating in 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). , Alabama Alabama, indigenous people of North America Alabama (ăləbăm`ə), indigenous people of North America whose language belongs to the Muskogean branch of the Hokan-Siouan linguistic stock (see Native American languages). , Colorado, Florida, Georgia, North Carolina North Carolina, state in the SE United States. It is bordered by the Atlantic Ocean (E), South Carolina and Georgia (S), Tennessee (W), and Virginia (N). Facts and Figures Area, 52,586 sq mi (136,198 sq km). Pop. , Oregon, South Carolina South Carolina, state of the SE United States. It is bordered by North Carolina (N), the Atlantic Ocean (SE), and Georgia (SW). Facts and Figures Area, 31,055 sq mi (80,432 sq km). Pop. (2000) 4,012,012, a 15. , Tennessee and Washington. See enclosed en·close also in·close tr.v. en·closed, en·clos·ing, en·clos·es 1. To surround on all sides; close in. 2. To fence in so as to prevent common use: enclosed the pasture. financial tables Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. Disclosure This release contains forward-looking statements 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. 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 share and per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
--------------------- ---------------------
2004 2003 2004 2003
---------- ---------- ---------- ----------
Interest income $5,711 $5,020 $16,117 $15,398
Interest expense 1,954 2,198 5,838 7,243
---------- ---------- ---------- ----------
Net interest income 3,757 2,822 10,279 8,155
Provision for loan losses 186 298 251 1,006
---------- ---------- ---------- ----------
Net interest income after
provision for loan losses 3,571 2,524 10,028 7,149
Non-interest income 2,157 3,013 8,028 8,199
Non-interest expenses 4,086 4,196 13,161 12,722
---------- ---------- ---------- ----------
Income before income taxes 1,642 1,341 4,895 2,626
Provision for income taxes 675 456 2,014 895
---------- ---------- ---------- ----------
NET INCOME $967 $885 $2,881 $1,731
========== ========== ========== ==========
Earnings per share:
Basic $0.17 $0.16 $0.50 $0.30
Diluted 0.16 0.15 0.49 0.30
Weighted average shares:
Basic 5,719,647 5,692,732 5,713,765 5,691,069
Diluted 5,868,973 5,773,400 5,844,209 5,738,139
Selected average balance sheet items
------------------------------------
Average assets $341,963 $301,672 $325,674 $298,946
Average gross loans 282,412 253,547 268,624 249,402
COMMUNITY WEST BANCSHARES
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
(in 000's, except share and per share data)
September 30, 2004 December 31, 2003
------------------ -----------------
Cash and cash equivalents $26,721 $22,056
Interest-earning deposits in
other financial institutions 392 792
Investment securities 25,322 20,468
Loans:
Held for sale 36,968 42,038
------------------ -----------------
Held for investment 219,877 169,526
Less: Allowance (2,931) (2,652)
------------------ -----------------
Net held for investment 216,946 166,874
------------------ -----------------
Securitized loans 25,735 37,386
Less: Allowance (1,109) (2,024)
------------------ -----------------
Net securitized loans 24,626 35,362
------------------ -----------------
NET LOANS 278,540 244,274
------------------ -----------------
Other assets 16,265 16,660
------------------ -----------------
TOTAL ASSETS $347,240 $304,250
================== =================
Deposits $262,960 $224,855
Repurchase agreements 17,425 14,394
FHLB advances 7,500 -
Bonds payable 15,969 26,100
Other liabilities 6,508 4,570
------------------ -----------------
TOTAL LIABILITIES 310,362 269,919
Stockholders' equity 36,878 34,331
------------------ -----------------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $347,240 $304,250
================== =================
Shares outstanding 5,729,869 5,706,769
Book value per share $6.44 $6.02
Nonaccrual loans $7,655 $7,174
SBA guaranteed portion (4,743) (4,106)
------------------ -----------------
Nonaccrual loans, net $2,912 $3,068
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