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Orange County Business Bank Announces Financial Results

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IRVINE, Calif.--(BUSINESS WIRE)--

Orange County Business Bank (the “Bank”) (OTCBB: OCBB) announced financial results for the three months and nine months ended September 30, 2012.

The Bank's net income for the three months ended September 30, 2012 was $693 thousand versus a net loss of $84 thousand for the same period in 2011. The Bank reported net income for the first nine months of 2012 of $567 thousand versus a net loss of $221 thousand for the same period in 2011.

The Bank's net interest income for the three months ended September 30, 2012 was $1.0 million versus $1.3 million a year ago. The difference of $300 thousand in net interest income was primarily driven by a decrease in the total loans outstanding. As the economy has stagnated, the Bank has not been able to replace the loans that have paid off. The provision for loan and lease losses was a benefit of $1 million. Non-interest income for the three months ended September 30, 2012 was $420 thousand versus $166 thousand for the same period last year as the Bank repositioned its investment securities portfolio and earned increased gains from the corresponding sale of securities comparing this quarter to the same quarter a year ago. Non-interest expense was up for the third quarter of 2012 over the same period in 2011, $1.8 million versus $1.6 million, respectively due to restructuring costs and legal fees.

Net interest income after the release of reserves from the allowance for loan and lease losses for the nine months ended September 30, 2012 was $4.5 million versus $4.2 million for the same period in 2011. The difference of $300 thousand was due to a decrease in loan interest income. Non-interest income for the first nine months of 2012 was $1.1 million versus $485 thousand for the same period in 2011 due to the increase in gains on sales of investment securities. Non-interest expense was $5.0 million for the nine months ended September 30, 2012 versus $4.9 million for the same period in 2011.

As of September 30, 2012, the Bank had a ratio of Shareholders' Equity to Total Assets of 22.6%. At September 30, 2012, the Bank's assets totaled $172.5 million, with loans totaling $78.8 million, and deposits totaling $117.5 million. The Bank's capital ratios continued to far exceed regulatory guidelines for “well-capitalized” institutions at September 30, 2012.

Orange County Business Bank offers complete relationship banking services for locally owned and operated businesses, professional practices and commercial/industrial companies of Orange County and adjacent markets. The Bank's services include a broad selection of depository as well as business loans and commercial real estate financing products uniquely designed for each client. The Bank maintains its administrative offices at 17901 Von Karman, Suite 100, Irvine, California 92614. The Bank's website is www.ocbusinessbank.com.

This press release includes ‘forward-looking' statements within the meaning of Section 27A of the Securities Act. All of the statements contained in this press release, other than statements of historical fact, should be considered forward-looking statements, including but not limited to, any statements which may concern (i) the Bank's strategies, objectives and plans for expansion of its operations, product and services, and growth of its portfolio of loans, deposits and investments, (ii) the Bank's beliefs and expectations regarding actions that may be taken by regulatory authorities having oversight of the Bank, (iii) the Bank's beliefs as to the adequacy of the allowance for loan losses, and (iv) the Bank's beliefs and expectations of the future operating results. Although the Bank believes the expectation reflected in these forward-looking statements are reasonable, it can give no assurance that these expectations will prove to have been correct. All subsequent written and oral forward-looking statements by or attributable to the Bank or persons acting on its behalf are expressly qualified in their entirety by this qualification. Investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof and are not intended to give any assurance as to future results. The Bank undertakes no obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

    As of and for the       As of and for the
Three Months Ended September 30, Nine Months Ended September 30,
  2012           2011     2012           2011  
Operating Data
Interest income $ 1,291,000 $ 1,605,000 $ 4,206,000 $ 5,117,000
Interest expense   250,000     300,000     752,000     935,000  
Net interest income 1,041,000 1,305,000 3,454,000 4,182,000
Reduction in allowance for loan and lease losses   (1,000,000 )   -     (1,000,000 )   -  
Net interest income after reduction in allowance
for loan and lease losses 2,041,000 1,305,000 4,454,000 4,182,000
Non-interest income 420,000 166,000 1,107,000 485,000
Non-interest expense   1,768,000     1,591,000     4,994,000     4,924,000  
Income before provision for income taxes 693,000 (120,000 ) 567,000 (257,000 )
Provision for income taxes   -     (36,000 )   -     (36,000 )
Net income $ 693,000   $ (84,000 ) $ 567,000   $ (221,000 )
 
Per Share Data and Other Ratios
Net Earnings (loss) – Basic $ 0.15 $ (0.02 ) $ 0.12 $ (0.05 )
Return (loss) on Average Assets 1.59 % (0.18 %) 0.44 % (0.16 %)
Return (loss) on Average Equity 7.28 % (0.88 %) 1.98 % (0.77 %)
Net Interest Margin 2.48 % 2.84 % 2.82 % 3.06 %
 
 
September 30, 2012 December 31, 2011
Balance Sheet Data and Related Ratios
Total Assets $ 172,547,000 $ 168,690,000
Total Loans 78,812,000 103,536,000
Allowance for Loan Losses (ALLL) 1,928,000 2,849,000
Investment Securities 48,848,000 34,688,000
Total Deposits 117,500,000 108,267,000
Total Shareholders' Equity 39,001,000 38,365,000
ALLL as a Percentage of Total Loans 2.45 % 2.75 %
Book Value $ 8.25 $ 8.12
Actual Number of Shares Outstanding 4,724,576 4,724,576

Orange County Business Bank
JP Gough
Chairman & CEO
Phone: (949) 221-0001
Fax: (949) 225-1500
jpgough@ocbusinessbank.com
or
Victor E. Guerrero
Executive Vice President
Chief Financial Officer
Phone: (949) 999-2642
Fax: (949) 225-1500
vguerrero@ocbusinessbank.com

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