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Community 1st Bancorp Reports Results for the Quarter Ended September 30, 2016

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

Community 1st Bancorp (OTCBB: CFBN), with $350.8 million in assets, today reported net income of $365 thousand, or $0.06 per diluted share, for the quarter ended September 30, 2016 compared to $334 thousand, or $0.05 per diluted share, for the quarter ended September 30, 2015. Community 1st Bancorp ("the Company") reported net income of $902 thousand, or $0.14 per diluted share, for the nine months ended September 30, 2016 compared to $950 thousand, or $0.15 per diluted share, for the nine months ended September 30, 2015.

James J. Kim, President and CEO commented, "The results for our Company are very encouraging for the third quarter ended September 30, 2016. We have continued to improve earnings and grow non-interest bearing deposits, while building the necessary infrastructure to support our long-term goals and strategies."

Total assets at September 30, 2016 were $350.8 million, representing an increase during the quarter of $33.8 million from $317.0 million at June 30, 2016. The Company was successful in growing non-interest bearing deposits by $20.6 million from $98.4 million at June 30, 2016 to $119.0 million at September 30, 2016. Loans grew by $10.1 million from $178.2 million at June 30, 2016 to $188.3 million at September 30, 2016. Total deposits increased by $33.3 million from $286.6 million at June 30, 2016 to $319.9 million at September 30, 2016.

When compared to September 30, 2015, total assets increased by $107.4 million, or 44.1%, and total deposits increased from $218.8 million at September 30, 2015 to $319.9 million at September 30, 2016, an increase of $101.0 million, or 46.1%. Non-interest bearing deposits increased from $62.6 million at September 30, 2015 to $119.0 million at September 30, 2016. Loans increased $33.2 million, or 21.4%, at September 30, 2016 when compared to September 30, 2015.

Operating Results - Quarter

The Company reported net income for the quarter ended September 30, 2016 of $365 thousand, or $0.06 per diluted share, compared to $334 thousand, or $0.05 per diluted share, for the quarter ended September 30, 2015. The Company did not record provisions for loan losses or gains or losses related to loan or security sales for the quarter ended September 30, 2016, or for the quarter ended September 30, 2015. The Company had net interest income of $2.37 million for the quarter ended September 30, 2016 versus $1.96 million for the same period in 2015. Non-interest income was $140 thousand for the quarter ended September 30, 2016 this compares to $122 thousand in non-interest income for the same period in 2015. Non-interest expense was $1.93 million for the third quarter of 2016 compared to $1.56 million for the third quarter of 2015.

Interest income increased by $564 thousand, or 25.7%, to total $2.76 million for the quarter ended September 30, 2016 compared to the same period in 2015. The growth in interest income was driven by the growth in the loan portfolio and the growth in investment securities. Interest expense increased by $151 thousand, or 62.9%, to total $391 thousand for the quarter ended September 30, 2016 compared to the same period in 2015. The increase in interest expense is primarily due to the issuance of subordinated debentures in December of 2015 to facilitate the future growth of the Company. Net interest income increased by $413 thousand, or 21.1%, for the third quarter of 2016 compared to the same period in 2015. The net interest margin for the quarter ended September 30, 2016 was 3.34% representing a decrease of 32 basis points from 3.66% for the quarter ended September 30, 2015.

Operating Results - Year

The Company reported net income for the nine month period ended September 30, 2016 of $902 thousand, this compares to $950 thousand for the same period in 2015. The Company did not record any provisions for loan losses in either year. The Company had net interest income of $6.52 million for the ninth month period ended September 30, 2016 compared to $5.76 million for the same period in 2015. The Company had non-interest income of $405 thousand for the nine month period ended September 30, 2016 this compares to $438 thousand which includes gains on sales of loans of $163 thousand and losses on sales of securities of $96 thousand. The Company had non-interest expense of $5.52 million for the nine month period ended September 30, 2016 compared to $4.67 million for the same period 2015.

Interest income increased by $1.23 million, or 19.2%, to total $7.68 million for the nine month period ended September 30, 2016 compared to the same period in 2015. Interest expense increased by $474 thousand, or 70.0%, to total $1.15 million for the nine month period ended September 30, 2016 compared to the same period in 2015. The increase in interest expense is primarily due to the issuance of subordinated debentures in December of 2015. Net interest income increased by $760 thousand, or 13.2%, for the nine month period ended September 30, 2016 compared to the same period in 2015. Non-interest expense increased by $854 thousand, or 18.3%, to total $5.52 million for the nine month period ended September 30, 2016 compared to the same period in 2015. The net interest margin for the nine month period ended September 30, 2016 was 3.42% representing a decrease of 22 basis points from 3.64% for the period ended September 30, 2015.

Credit Quality

The allowance for loan losses at September 30, 2016 was $2.75 million, or 1.46% of gross loans, compared to $2.74 million, or 1.77% of gross loans at September 30, 2015. There were no loan charge-offs for the quarter ended September 30, 2016 and recoveries of $2 thousand compared to no loan charge-offs with recoveries of less than $1 thousand for the same period in 2015. There were no loan charge-offs for the nine month period ended September 30, 2016 and recoveries of $12 thousand compared to loan charge-offs of $320 thousand with recoveries of $461 thousand for the same period in 2015.

Nonperforming loans at September 30, 2016 were $694 thousand, or 0.20% of total assets, representing an increase of $464 thousand, or 201.7%, from September 30, 2015 and other real estate owned at September 30, 2016 was $3.96 million, representing a decrease of $86 thousand, or 2.1%. Nonperforming loans at September 30, 2016 increased by $477 thousand, or 219.8%, from $217 thousand at December 31, 2015 and other real estate owned decreased by $85 thousand, or 2.1%, from $4.04 million at December 31, 2015.

Capital

The Company and Community 1st Bank (the "Bank") continues to maintain a strong capital position under Basel III. The Company had Common Equity Tier 1 ratio of 11.6%, Tier 1 Leverage ratio of 8.3%, Tier 1 Risk-based Capital ratio of 11.6% and Total Risk-based Capital ratio of 15.1% at September 30, 2016. The Bank had Common Equity Tier 1 ratio of 13.7%, Tier 1 Leverage ratio of 9.1%, Tier 1 Risk-based Capital ratio of 13.7% and Total Risk-based Capital ratio of 14.95% at September 30, 2016.

James J. Kim, President and Chief Executive Officer, commented, "Community 1st Bancorp is well positioned to continue its balance sheet growth and improve core earnings by repositioning earning assets towards higher yielding loans and lowering the cost of our funding base by our continued focus on increasing non-interest bearing deposits."

Community 1st Bank is headquartered in Auburn, California, with branches in Roseville, Auburn and Sacramento, California. Community 1st Bank offers a wide range of business and consumer deposit products including remote deposit capture, health savings accounts, online banking, mobile banking and cash management services. The Bank also offers a full complement of loan products, including commercial, consumer, and real estate loans. For more information about the Bank, visit the Bank's website at www.community1bank.com.

Forward-Looking Statements

Statements concerning future performance, developments or events, expectations for growth and income forecasts, and any other guidance on future periods, constitute forward-looking statements that are subject to a number of risks and uncertainties. Actual results may differ materially from stated expectations. Specific factors include, but are not limited to, loan production, competitive pressure in the banking industry, balance sheet management, net interest margin variations, the ability to control costs and expenses, changes in the interest rate environment and financial policies of the United States government and general economic conditions. The Bank disclaims any obligation to update any such factors.

             
COMMUNITY 1ST BANCORP
CONSOLIDATED BALANCE SHEETS
 
 
9/30/16     12/31/15*     9/30/15
(Unaudited) (Unaudited)
ASSETS
Cash and cash equivalents $ 47,372,000 $ 27,684,000 $ 19,132,000
Federal funds sold 1,430,000 2,590,000 1,671,000
Available-for-sale investment securities, at fair value 100,864,000 56,437,000 54,883,000

Loans, less allowance for loan losses of $2,754,000 at September 30, 2016, $2,742,000 at December 31,2015 and $2,740,000 at September 30, 2015

185,500,000 161,611,000 152,288,000
Bank premises and equipment, net 1,677,000 1,397,000 1,339,000
Interest receivable 879,000 626,000 551,000
Other real estate owned 3,955,000 4,040,000 4,041,000
Federal Home Loan Bank stock and other securities 1,368,000 1,329,000 1,328,000
Bank-owned life insurance policies 5,098,000 4,986,000 4,948,000
Other assets   2,620,000       3,099,000       3,228,000
 
Total assets $ 350,763,000     $ 263,799,000     $ 243,409,000
 
LIABILITIES AND SHAREHOLDERS' EQUITY
Non-interest bearing $ 119,000,000 $ 65,655,000 $ 62,605,000
Interest bearing   200,856,000       168,581,000       156,231,000
 
Total deposits 319,856,000 234,236,000 218,836,000
 
Subordinated debentures 4,898,000 4,890,000 -
Interest payable and other liabilities   733,000       601,000       639,000
 
Total liabilities 325,487,000 239,727,000 219,475,000
 
Shareholders' equity   25,276,000       24,072,000       23,934,000
 
Total liabilities and shareholders' equity $ 350,763,000     $ 263,799,000     $ 243,409,000
 
*Derived from audited Consolidated Financial Statements
 
COMMUNITY 1ST BANCORP
CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
                       
For the Three Months Ended: For the Nine Months Ended:
9/30/16     6/30/16     9/30/15 9/30/16     9/30/15
Interest income:
Interest and fees on loans $ 2,197,000 $ 2,074,000 $ 1,941,000 $ 6,294,000 $ 5,556,000

Interest on investment securities and interest-bearing deposits in other financial institutions

  563,000       472,000       255,000   1,381,000       885,000  
 
Total interest income   2,760,000       2,546,000       2,196,000   7,675,000       6,441,000  
 
Interest expense:
Deposits 288,000 287,000 240,000 844,000 678,000
Subordinated debentures   103,000       102,000       -   308,000       -  
 
Total interest expense   391,000       389,000       240,000   1,152,000       678,000  
 
Net interest income 2,369,000 2,157,000 1,956,000 6,523,000 5,763,000
 
Provision for loan losses   -       -       -   -       -  
 
Net interest income after provision for loan losses   2,369,000       2,157,000       1,956,000   6,523,000       5,763,000  
 
Non-interest income:
Service charges and fees 21,000 19,000 10,000 53,000 34,000
Gain on sales of loans - - - - 163,000
Loss on sales of available-for-sale investment securities - - - - (96,000 )
Other   119,000       119,000       112,000   352,000       337,000  
 
Total non-interest income   140,000       138,000       122,000   405,000       438,000  
 
Non-interest expense:
Salaries and employee benefits 997,000 972,000 815,000 2,893,000 2,468,000
Occupancy and equipment 215,000 205,000 150,000 547,000 435,000
Other   721,000       655,000       591,000   2,084,000       1,766,000  
 
Total non-interest expense   1,933,000       1,832,000       1,556,000   5,524,000       4,669,000  
 

Net income before provision for taxes

$ 576,000 $ 463,000 $ 522,000 $ 1,404,000 $ 1,532,000
Provision for taxes 211,000 171,000 188,000 502,000 582,000
Net income $ 365,000     $ 292,000     $ 334,000 $ 902,000     $ 950,000  
 
Net income $ 365,000 $ 292,000 $ 334,000 $ 902,000 $ 950,000
Preferred stock dividends   -       -       35,000   -       105,000  
 
Net income available to common shareholders $ 365,000     $ 292,000     $ 299,000 $ 902,000     $ 845,000  
 
Common Share Data
Basic earnings per share $ 0.06 $ 0.04 $ 0.05 $ 0.14 $ 0.15
Diluted earnings per share $ 0.06 $ 0.04 $ 0.05 $ 0.14 $ 0.15
 
Weighted average shares outstanding 6,524,741 6,524,741 5,494,937 6,523,421 5,494,937
Weighted average shares outstanding - diluted 6,555,049 6,533,694 6,518,940 6,536,223 6,516,191
 

Community 1st Bancorp
James J. Kim, 530-863-4803
President & Chief Executive Officer
Fax: 530-863-4849
or
Kevin R. Watson, 530-863-4815
Executive Vice President & Chief Financial Officer
Fax: 530-863-4849

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