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CalWest Bancorp Announces Financial Results as of March 31, 2007.

IRVINE, Calif. -- CalWest Bancorp (OTCBB:CALW) announced its wholly owned subsidiary South County Bank reported net income after-tax for the three months ended March 31, 2007 of $42,000. CalWest Bancorp reported consolidated financial results for the three months ended March 31, 2007 net loss of $9,000.

"The Bank experienced significant growth in funded loans from the period of March 2006 through March 2007. Total loans grew $24.4 million to a total of $104.5 million compared to $80.0 million as of March 31, 2006. That represented a 30.5% growth in loans. During first quarter 2007, total loans increased by $9.8 million that represents a 10.3% growth from December 31, 2006. This growth was far ahead of our 2007 plan and it caused us to prematurely recognize some expenses associated with that growth. We needed to fund the loan reserves attributed to the increase in loans; and we had commission expenses related to the originations of those loans," said Thomas E. Yott, President and CEO.

"There were additional compensation expenses related to our new Redlands and Huntington Beach offices, along with increased overall premise costs. Overall, we have expanded the Bank from two locations to 6 locations in less than 15 months. This is very healthy 'Organic' growth and typically it takes approximately 15 months of operation to break into a profitable position on new locations. We have opened new full-service branch locations in Irvine, Moreno Valley, Redlands and Huntington Beach all within the last 15 months that will require some seasoning before they become profitable," added CEO Yott.

"Despite all of the expenses incurred associated with the above noted growth, the Bancorp's subsidiary still managed to post a profit for the 1st quarter 2007. Total assets for March 31, 2007 were $170.6 million compared to $176.8 million at March 31, 2006. Total non-interest bearing deposits were $52.9 million as of March 31, 2007, which decreased 29.3% from March 31, 2006. As Federal Reserve raised rates last year, the non-interest bearing deposit balances shifted to interest bearing deposits which increased by $9.97 million as of March 31, 2007 or 13.3% from March 31, 2006. Also, the Bank increased its borrowings from the Federal Home Loan Bank to fund the growth in loans during the first quarter 2007. With an increase in interest bearing deposits and borrowings, the interest expense grew by 47.5% as of 1st quarter 2007 compared to 1st quarter 2006. Total interest income increased $426,000 to $2.9 million compared to $2.4 million for the first quarter 2006. Asset quality remains strong and new loan originations remain steady. Our two newest locations have already produced some good results for the first 30 days of operation. We look forward with anticipation for some healthy profit growth in the 2nd quarter of 2007," said Thomas E. Yott, CEO.

Forward-Looking Comments: The statements contained in this release that are not historical facts are forward-looking statements based on management's current expectations and beliefs concerning future developments and their potential effects on the Bank. There can be no assurance that future developments affecting the Bank will be those anticipated by management. Actual results may differ from those projected in the forward-looking statements. These forward-looking statements involve risks and uncertainties.
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Publication:Business Wire
Article Type:Financial report
Date:Apr 14, 2007
Words:555
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