Market Overview

Plaza Bank Reports Fourth Quarter and Full Year 2016 Results

Share:
SEATTLE--(BUSINESS WIRE)--

Plaza Bank (OTCBB: PZBW) reported net income of $299,000 for the fourth quarter of 2016. This compares to the $229,000 net income recognized in the previous quarter ended September 30, 2016 and is a significant improvement from the $97,000 loss recognized during the fourth quarter of 2015. As a result of improving credit quality, the current quarter results include a reverse provision for loan losses of $219,000. During the year ended December 31, 2016, the Bank recorded net income of $657,000 compared to a net loss of $835,000 for the year ended December 31, 2015. Exclusive of the $377,000 in reverse provisions recognized during 2016, this represents an improvement of over $1.1 million compared to 2015 results.

"We've completed the first profitable year in the company's history, and continue to make progress on all fronts. We have seen solid growth in both the loan and core deposit portfolios, significantly reduced problem loans and seen equity accretion through earnings and the reduction of our excess allowance for loan losses", said Donald Burton, Bank Chairman.

Highlights of the current quarter include:

  • Net income was $299,000, compared to a loss of $97,000 for the fourth quarter of 2015.
  • Compared to that same period a year ago, every aspect of the income statement was improved:
    • Net interest income before provision was $122,000, or 20.8% higher;
    • Net interest margin was 3.96%, compared to 3.25%;
    • Noninterest income was $3,000, or 9.4% higher;
    • Noninterest expense was $52,000, or 7.3% lower; and
    • Due to improved credit quality, the Bank recognized a $219,000 reverse provision.
  • Compared to December 31, 2015, aspects of our balance sheet improved as well:
    • Total assets increased $2.2 million, with a material shift from cash and investments (down $7.6 million) to net loans (up $10.0 million);
    • Nonperforming asset to total asset ratio of 0.25%, compared to 1.89%;
    • Classified loans decreased to $1.5 million, compared to $8.9 million;
    • Core deposits increased $8.3 million, or 23.3%;
    • Noncore deposits decreased $13.9 million, or 54.3%; and
    • Capital increased $694,000, or 8.9%, to $8.5 million.

"We are looking forward to 2017 being a great year for the Bank and are excited to continue this run of loan growth and earnings," said Burton.

For more information regarding Plaza Bank, please contact President and CEO Mike Anderson at (206) 436-7615 or manderson@plazabankwa.com.

About Plaza Bank

Founded in 2006, Plaza Bank is a state chartered full-service commercial bank, headquartered in downtown Seattle. The bank serves closely held commercial businesses, professional firms, non-profit organizations and the people who make them successful. The company provides high quality commercial banking services tailored for the small business community of Puget Sound. For more information, visit www.PlazaBankWA.com.

Forward-Looking Statement Safe Harbor

This earnings release contains comments or information that constitute forward-looking statements and are based on current expectations that involve risks and uncertainties. Forward-looking statements may describe Plaza Bank's projections, estimates, plans and expectations of future performance and can be identified by words such as "believe," "expect", "intend," "estimate," "likely," "anticipate," and other similar expressions. These are not guarantees of future performance, and actual results may differ materially from the results expressed in these forward-looking statements—which due to their forward-looking nature—are difficult to predict. Investors should not place undue reliance on any forward-looking statement and should consider factors that might cause differences between actual performance and projected performance. Among other things, we face risks associated with: our ability to grow our loan and deposit franchises and capitalize on market opportunities; changes in interest rates; competition from traditional or nontraditional competitors; declines in real estate or related markets; increases in regional employment levels; decreases in general economic conditions that impact our business or our markets; actions by the Federal Reserve Bank which affect monetary and/or fiscal policy; regulatory or legislative actions that may increase capital requirements or otherwise limit our ability to do business; changes to the quality of the loan portfolio and our ability to succeed in problem-asset resolution efforts; our ability to maintain electronic and physical security of our customer data and our information systems; our ability to maintain compliance with applicable laws and regulations; our ability to attract and retain key personnel; changes in tax laws; and other risk factors. Plaza Bank undertakes no obligation to publicly update or clarify any forward-looking statement to reflect the impact of circumstances or events that may arise after the date of this release.

     
Balance Sheet
(in thousands) Dec 31, 2016 Sep 30, 2016 Dec 31, 2015
    (Unaudited) (Unaudited) (Audited)
 
Cash $ 2,940 $ 1,612 $ 6,436
Investments 7,942 8,171 11,998
Loans
Total loans 63,588 57,504 54,060
Allowance for loan losses   (2,280 )   (2,491 )   (2,760 )
Net loans 61,308 55,013 51,300
 
Premises and equipment 64 71 75
Other real estate owned - - 110
Other assets   644     574     739  
Total assets $ 72,898   $ 65,441   $ 70,658  
 
Deposits
Core deposits $ 44,156 $ 40,929 $ 35,821
Noncore deposits (1)   11,700     9,658     25,619  
Total deposits 55,856 50,587 61,440
 
Borrowed funds 8,137 6,137 1,137
Other liabilities 384 444 254
Capital   8,521     8,273     7,827  
Total liabilities and capital $ 72,898   $ 65,441   $ 70,658  
 

(1) Noncore deposits are comprised of brokered deposits, certificates obtained using a listing service and public deposits.

 
Key Ratios and Supplemental Information
(in thousands) Dec 31, 2016 Sep 30, 2016 Dec 31, 2015
(Unaudited) (Unaudited) (Audited)
 
Non-performing loans $ 181 $ 181 $ 1,225
Other real estate owned   -     -     110  
Total nonperforming assets $ 181   $ 181   $ 1,335  
 
Nonperforming assets to total assets 0.25 % 0.28 % 1.89 %
Allowance for loan losses to total loans 3.59 % 4.33 % 5.11 %
Non-performing loans to allowance 7.94 % 7.27 % 44.38 %
 
Equity to assets ratio 11.69 % 12.64 % 11.08 %
Tier 1 leverage ratio 11.90 % 11.73 % 10.69 %
Tier 1 risk-based capital ratio 13.39 % 13.55 % 13.91 %
 
 
Income Statement
(in thousands) Three Months Ended Dec 31, Years Ended Dec 31,
  2016     2015     2016     2015  
(Unaudited) (Unaudited) (Unaudited) (Audited)
 
Interest income $ 810 $ 694 $ 3,042 $ 2,776
Interest expense   102     108     402     483  
Net interest income 708 586 2,640 2,293
 
Provision for loan losses   (219 )   -     (377 )   -  
Net interest income after prov 927 586 3,017 2,293
 
Noninterest income 35 32 644 276
 
Noninterest expense
Compensation and benefits 358 408 1,700 1,867
Premises and equipment 69 78 278 360
Data processing 97 102 397 389
Outside and professional services 23 19 212 244
Other operating expenses   116     108     417     544  
Total noninterest expense 663 715 3,004 3,404
 
Net income/(loss) before taxes 299 (97 ) 657 (835 )
Provision for income taxes   -     -     -     -  
Net income/(loss) after taxes $ 299   $ (97 ) $ 657   $ (835 )
 
Net interest margin 3.96 % 3.25 % 3.84 % 3.17 %
Return/(loss) on average assets 1.68 % -0.53 % 0.95 % -1.15 %

Plaza Bank
President and CEO
Mike Anderson, 206-436-7615
manderson@plazabankwa.com

View Comments and Join the Discussion!