Pacific Mercantile Bancorp Reports Profit In 1Q

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Pacific Mercantile Bancorp
PMBC
reported net income of $284 thousand or $0.01 per share for the first quarter. In comparison, the company suffered a net loss of $85 thousand or $0.00 a share in the year-ago quarter. The current quarter's EPS is in line with the Street expectations. Pacific Mercantile's total interest income grew 5% to $9.95 million from $9.47 million in the previous year quarter. The current quarter results included a provision for loan and leases losses of $420 thousand. Its net interest margin rose to 3.37% from $3.23% in the preceding quarter. The company's President and CEO, Tom Vertin, commented that "We had a strong quarter of new client acquisition activity and building franchise value. We generated our highest level of loan commitments in the past three quarters and had strong inflows of core deposits. At March 31, 2016, we had $510.8 million in total commitments on commercial lines of credit, an annualized increase of 8.8% over the previous year, and core deposits increased to 73% of total deposits, up from 65% a year earlier." The CEO said further that "However, we continue to see seasonal declines in commercial line utilization in the first quarter each year since our transition to a commercial banking model. Credit line utilization declined to 65.1% at March 31, 2016 from 69.5% at the end of 2015, which resulted in a decrease in our commercial loan portfolio during the first quarter. As we enter the seasonally stronger periods of the year, we expect to see an increase in line utilization contribute to the growth in our commercial loan portfolio." Vertin continued to say that "We continue to have a strong pipeline of new business opportunities across our asset-based lending, entertainment and traditional C&I banking groups. We are also seeing steady improvement in our net interest margin and operating efficiency ratio. As we continue to add new clients and see higher utilization rates on commercial lines of credit, we expect to generate a higher level of profitability as we move through the year." On Friday, the stock traded down by 0.66%.
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Posted In: EarningsNewsPress Releases
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