Pacific Mercantile Bancorp (Nasdaq: PMBC), the holding company of
Pacific Mercantile Bank (the “Bank”), a wholly owned banking
subsidiary, today reported its financial results for the three and
six months ended June 30, 2021.
For the second quarter of 2021, the Company
reported net income of $3.9 million, or $0.16 per fully diluted
share, which included merger-related expense that negatively
impacted earnings per share by $0.02. This compares to net income
of $3.4 million, or $0.14 per fully diluted share, in the first
quarter of 2021, and net income of $1.9 million, or $0.08 per fully
diluted share, in the second quarter of 2020. Expenses related to
the pending merger with BANC totaling $584 thousand are included in
our net income for the second quarter of 2021, which reduced
earnings per share by approximately $0.02; this compares to merger
related expenses of $387 thousand for the first quarter of 2021,
which reduced earnings per share by approximately $0.01. The
increase in net income for the three months ended June 30,
2021, as compared to the three months ended March 31, 2021, is
primarily attributable to an increase in noninterest income as the
result of gain on sale of loans and gain on sale of securities,
partially offset by a decrease to interest income as a result of a
lower average balance and lower average yield of our loan portfolio
due to the forgiveness of PPP loans, paydowns on lines of credit,
and decreased PPP fee income. The increase in net income, as
compared to the three months ended June 30, 2020, is primarily
attributable to no provision for loan and lease losses for the
three months ended June 30, 2021, compared to a $2.9 million
provision taken for the three months ended June 30, 2020. In
addition, noninterest income increased 144.7% when compared to the
same quarter of the prior year as the result of net gain on sale of
loans and net gain on sale of securities, referral fees related to
PPP loan servicing that did not occur in the same quarter of the
prior year, and modifications to our loan and deposit fee
structures. This increase was partially offset by a $1.6 million,
or 12.1%, decrease to net interest income primarily attributable to
a decrease in interest earned on loans and short-term investments
as a result of lower average yields during the three months ended
June 30, 2021 compared to the three months ended June 30,
2020, which was partially offset by a reduction in costs of
deposits.
Brad R. Dinsmore, President & CEO of Pacific
Mercantile Bancorp, said, “Our second quarter results reflect
continued progress in executing on the strategic initiatives that
have strengthened the foundation of our franchise and improved our
ability to generate profitable growth. We continued to see declines
in our cost of deposits resulting from our improved deposit mix,
increased efficiencies, and higher non-interest income contributing
to further increases in our level of profitability. Despite the
impact of merger-related expense and excess liquidity that reduced
our net interest margin, we generated a return on average assets of
0.99% in the second quarter, which is significantly higher than the
Company’s performance over the past several years. We are also
effectively implementing our profitable growth strategies, which
have enabled us to exit lower-rated credits from the bank and
reduce classified assets by 40% since the start of the year. Our
business development efforts continue to result in the steady
growth of our commercial client roster, and we look forward to
enhancing our ability to serve the financial needs of our clients
as part of a larger organization following the completion of our
merger with Banc of California.”
Results of Operations
The following tables show a summary of our
operating results for the dates and periods indicated. The
discussion below highlights the key factors contributing to the
changes shown in the following tables for the three and six months
ended June 30, 2021, as compared to the three months ended
March 31, 2021 and the three and six months ended
June 30, 2020.
|
Three Months Ended |
|
June 30, 2021 |
|
March 31, 2021 |
|
December 31, 2020 |
|
September 30, 2020 |
|
June 30, 2020 |
|
(Dollars in thousands) |
Total interest income |
$ |
12,539 |
|
|
$ |
13,698 |
|
|
$ |
14,234 |
|
|
$ |
16,016 |
|
|
$ |
15,580 |
|
Total interest
expense |
838 |
|
|
959 |
|
|
1,297 |
|
|
1,762 |
|
|
2,262 |
|
Net interest
income |
11,701 |
|
|
12,739 |
|
|
12,937 |
|
|
14,254 |
|
|
13,318 |
|
Provision for loan
and lease losses |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
2,850 |
|
Total noninterest
income |
2,865 |
|
|
1,738 |
|
|
1,827 |
|
|
2,245 |
|
|
1,171 |
|
Total noninterest
expense |
9,193 |
|
|
9,664 |
|
|
8,920 |
|
|
9,275 |
|
|
8,934 |
|
Income tax
provision |
1,479 |
|
|
1,425 |
|
|
2,140 |
|
|
2,138 |
|
|
800 |
|
Net income |
$ |
3,894 |
|
|
$ |
3,388 |
|
|
$ |
3,704 |
|
|
$ |
5,086 |
|
|
$ |
1,905 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, |
|
|
|
|
|
|
|
|
|
|
|
|
|
2021 |
|
2020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total interest income |
$ |
26,237 |
|
|
$ |
30,349 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total interest expense |
1,798 |
|
|
5,558 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
24,439 |
|
|
24,791 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for loan and lease
losses |
— |
|
|
9,050 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total noninterest income |
4,603 |
|
|
2,265 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total noninterest expense |
18,857 |
|
|
18,651 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax provision
(benefit) |
2,903 |
|
|
(190 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
$ |
7,282 |
|
|
$ |
(455 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Interest Income
Q2 2021 vs Q1 2021. Net
interest income decreased $1.0 million, or 8.1%, for the three
months ended June 30, 2021 as compared to the three months
ended March 31, 2021, primarily as a result of:
- A decrease in
interest income of $1.2 million, or 8.5%, primarily attributable to
a decrease in prepayment penalties and interest recoveries, lower
PPP fee income recognized, and a decrease in the average balance of
the loan portfolio related to payoffs and the forgiveness of PPP
loans, for the three months ended June 30, 2021 as compared to
the three months ended March 31, 2021; partially offset
by
- A decrease in
interest expense of $121 thousand, or 12.6%, primarily attributable
to our ongoing focus on reducing costs of deposits by monitoring
and lowering interest rates in response to the current interest
rate environment and actively managing our deposit portfolio away
from higher costing money market deposits and certificates of
deposit and into noninterest bearing deposits.
- Our net interest
margin decreased to 3.07% for the three months ended June 30,
2021 as compared to 3.43% for the three months ended March 31,
2021, primarily as a result of prepayment penalties, interest
recoveries, and other non-recurring loan income of $759 thousand
for the three months ended March 31, 2021 compared to $210
thousand for the three months ended June 30, 2021. Increased
liquidity held in low yielding Federal Funds sold resulting from an
increase in core deposits and PPP loan forgiveness, and decreased
commercial line utilization has also contributed to the decrease in
our net interest margin. The decrease in interest income was
partially offset by a decrease in costs of deposits and other
borrowings, and a favorable change in our mix of deposits from
higher costing certificates of deposit to lower costing noninterest
bearing deposits.
Q2 2021 vs Q2 2020. Net
interest income decreased $1.6 million, or 12.1%, for the three
months ended June 30, 2021 as compared to the three months
ended June 30, 2020, primarily as a result of:
- A decrease in
interest income of $3.0 million, or 19.5%, primarily attributable
to a decrease in interest earned on loans and short-term
investments as a result of lower average yields in the declining
interest rate environment during the three months ended
June 30, 2021 as compared to the three months ended
June 30, 2020, and a decrease in PPP fee income compared to
the same quarter prior year; partially offset by
- A decrease in
interest expense of $1.4 million, or 63.0%, primarily attributable
to our focus on reducing costs of deposits by monitoring and
lowering interest rates in response to the current interest rate
environment and actively managing our deposit portfolio away from
higher costing money market deposits and certificates of deposit
and into noninterest bearing deposits.
YTD 2021 vs YTD 2020. Net
interest income decreased $352 thousand, or 1.4%, for the six
months ended June 30, 2021 as compared to the six months ended
June 30, 2020, primarily as a result of:
- A decrease in
interest income of $4.1 million, or 13.5%, primarily attributable
to a decrease in interest earned on loans and short-term
investments as a result of lower average yields in the declining
interest rate environment during the six months ended June 30,
2021 as compared to the six months ended June 30, 2020;
partially offset by
- A decrease in
interest expense of $3.8 million, or 67.7%, primarily attributable
to our focus on reducing costs of deposits in combination with the
declining interest rate environment, and a favorable change in our
mix of deposits from higher costing certificates of deposit to
lower costing noninterest bearing deposits for the six months ended
June 30, 2021.
Provision for Loan and Lease
Losses
Q2 2021 vs Q1 2021. We recorded no provision
for loan and lease losses during the three months ended
June 30, 2021 and March 31, 2021 as the level of
allowance built earlier in the prior year in anticipation of
credits impacted by COVID-19 eventually migrating to nonperforming
status continued to be sufficient to reflect the actual migration
trends experienced in the portfolio. In addition, during the three
months ended June 30, 2021, classified loans and the balance
of our non-PPP loans decreased from the prior quarter. During the
three months ended June 30, 2021, we had net recoveries of
$141 thousand compared to net charge-offs of $325 thousand for the
three months ended March 31, 2021.
Q2 2021 vs Q2 2020. We recorded
no provision for loan and lease losses during the three months
ended June 30, 2021 as the level of allowance built earlier in
the prior year in anticipation of credits impacted by COVID-19
eventually migrating to nonperforming status continued to be
sufficient to reflect the actual migration trends experienced in
the portfolio. We recorded a $2.9 million provision for loan and
lease losses during the three months ended June 30, 2020 as a
result of net charge-offs, an increase in classified and
nonperforming loans, and qualitative factor increases related to
COVID-19.
YTD 2021 vs YTD 2020. We
recorded no provision for loan and lease losses during the six
months ended June 30, 2021 primarily as a result of reserves
for new loan growth being offset by a decline in the level of
classified assets. We recorded a $9.1 million provision for loan
and lease losses during the six months ended June 30, 2020 as
a result of net charge-offs of $4.5 million, an increase in
classified and nonperforming loans, and qualitative factor
increased related to COVID-19.
Noninterest Income
Q2 2021 vs Q1 2021. Noninterest
income increased by $1.1 million, or 64.8%, for the three months
ended June 30, 2021 as compared to the three months ended
March 31, 2021, primarily as a result of gain on sale of loans
of $878 thousand during the three months ended June 30, 2021,
which related to the outsourcing of our commercial credit card
product, and we did not have similar activity in the prior quarter,
and an increase in gain on sale of securities of $256 thousand, or
182.9%, from the prior quarter.
Q2 2021 vs Q2 2020. Noninterest
income increased by $1.7 million, or 144.7%, for the three months
ended June 30, 2021 as compared to the three months ended
June 30, 2020, primarily as a result of gain on sale of loans,
which related to the outsourcing of our commercial credit card
product, and we did not have similar activity in the same quarter
last year, and gain on sale of securities during the three months
ended June 30, 2021 that did not occur in the same quarter
prior year.
YTD 2021 vs YTD 2020.
Noninterest income increased $2.3 million, or 103.2%, for the six
months ended June 30, 2021 as compared to the six months ended
June 30, 2020, primarily as a result of:
- Gain on sale of
loans of $878 thousand, which related to the outsourcing of our
commercial credit card product, and we did not have similar
activity during the same period last year, and gain on sale of
securities of $536 thousand during the six months ended
June 30, 2021 that did not occur in the same period prior
year, and
- An increase of
$487 thousand, or 42.5%, in deposit related fees, credit card fees
and loan service fees, and
- An increase of $483 thousand, or
41.5%, in other noninterest income related to swap fee income and
referral fee income related to the partial outsourcing of Round 2
PPP loan origination.
Noninterest Expense
Q2 2021 vs Q1 2021. Noninterest
expense decreased $471 thousand, or 4.9%, for the three months
ended June 30, 2021 as compared to the three months ended
March 31, 2021, primarily as a result of:
- A decrease of
$205 thousand in FDIC insurance expense as the result of an
adjustment to the assessment rate based on a decrease in average
asset size and improved asset quality, and
- A decrease of
$204 thousand in other noninterest expense primarily related to
business development and other operating expenses, and
- A decrease of
$202 thousand in professional fees not related to the proposed
merger with Banc of California, as a result of increased legal fees
in the first quarter related to previously charged-off loans,
and
- A decrease of
$144 thousand in salaries and employee benefits primarily related
to increased payroll benefits during the three months ended
March 31, 2021 due to seasonality; partially offset by
- An increase of
$197 thousand in merger related expenses for accounting and
legal expenses related to the proposed merger with Banc of
California.
Q2 2021 vs Q2 2020. Noninterest
expense increased $259 thousand, or 2.9%, for the three months
ended June 30, 2021 as compared to the three months ended
June 30, 2020, primarily as a result of:
- Accounting and
legal expenses of $584 thousand related to the proposed merger
with Banc of California, and
- An increase of
$85 thousand in occupancy expense related to expired tenant
improvement credits also related to the proposed merger with Banc
of California, partially offset by
- A decrease of
$290 thousand in other noninterest expense primarily related to
business development and other operating expenses, and
- A decrease of
$130 thousand in FDIC insurance expense based on an adjustment to
the assessment rate based on a decrease in average asset size and
improved asset quality.
YTD 2021 vs YTD 2020.
Noninterest expense increased $206 thousand, or 1.1%, for the six
months ended June 30, 2021 as compared to the six months ended
June 30, 2020, primarily as a result of:
- Accounting and
legal expense of $971 thousand related to the proposed merger with
Banc of California, partially offset by
- A decrease of
$353 thousand in salaries and employee benefits primarily related
to the staffing changes made at the bank during the second quarter
of 2020, and
- A decrease of
$464 thousand in other noninterest expense primarily related to
business development and other operating expenses.
Income Tax Provision
For the three and six months ended June 30,
2021, we had an income tax expense of $1.5 million and $2.9
million, respectively, as a result of our operating income. For the
three months ended March 31, 2021, we had an income tax
expense of $1.4 million. The income tax expense during the three
months ended March 31, 2021 is a result of our operating
income. For the three months ended June 30, 2020, we had an
income tax expense of $800 thousand as a result of our operating
income. We had an income tax benefit of $190 thousand for the six
months ended June 30, 2020 as a result of our net operating
loss.
Accounting rules specify that management must
evaluate the deferred tax asset on a recurring basis to determine
whether enough positive evidence exists to determine whether it is
more-likely-than-not that the deferred tax asset will be available
to offset or reduce future taxes. The tax code allows net operating
losses incurred prior to December 31, 2017 to be carried forward
for 20 years from the date of the loss, and based on its
evaluation, management believes that the Company will be able to
realize the deferred tax asset within the period that our net
operating losses may be carried forward. Due to the hierarchy of
evidence that the accounting rules specify, management determined
that there continued to be enough positive evidence to support no
valuation allowance on our deferred tax asset at June 30,
2021, March 31, 2021, and June 30, 2020.
Balance Sheet Information
Loans
As indicated in the table below, at
June 30, 2021, gross loans totaled approximately $1.11
billion, which represented a decrease of $132.7 million, or 10.7%,
compared to gross loans outstanding at March 31, 2021. The
following table sets forth the composition, by loan category, of
our loan portfolio at June 30, 2021, March 31, 2021, and
December 31, 2020.
|
June 30, 2021 |
|
March 31, 2021 |
|
December 31, 2020 |
|
Amount |
|
Percent ofTotal Loans |
|
Amount |
|
Percent ofTotal Loans |
|
Amount |
|
Percent of Total Loans |
|
(Dollars in thousands) |
Commercial loans |
$ |
284,416 |
|
|
25.6 |
% |
|
$ |
321,319 |
|
|
25.8 |
% |
|
$ |
337,427 |
|
|
27.6 |
% |
Commercial loans - PPP |
177,961 |
|
|
16.0 |
% |
|
280,562 |
|
|
22.5 |
% |
|
229,728 |
|
|
18.8 |
% |
Commercial real estate loans -
owner occupied |
186,522 |
|
|
16.8 |
% |
|
189,203 |
|
|
15.2 |
% |
|
197,336 |
|
|
16.1 |
% |
Commercial real estate loans -
all other |
204,486 |
|
|
18.4 |
% |
|
197,026 |
|
|
15.8 |
% |
|
194,893 |
|
|
15.9 |
% |
Residential mortgage loans -
multi-family |
160,563 |
|
|
14.4 |
% |
|
157,646 |
|
|
12.7 |
% |
|
159,182 |
|
|
13.0 |
% |
Residential mortgage loans -
single family |
9,511 |
|
|
0.9 |
% |
|
10,085 |
|
|
0.8 |
% |
|
12,766 |
|
|
1.0 |
% |
Construction and land
development loans |
11,907 |
|
|
1.1 |
% |
|
11,840 |
|
|
1.0 |
% |
|
11,766 |
|
|
1.0 |
% |
Consumer loans |
76,325 |
|
|
6.8 |
% |
|
76,669 |
|
|
6.2 |
% |
|
80,759 |
|
|
6.6 |
% |
Gross loans |
$ |
1,111,691 |
|
|
100.0 |
% |
|
$ |
1,244,350 |
|
|
100.0 |
% |
|
$ |
1,223,857 |
|
|
100.0 |
% |
The decrease of $132.7 million in gross loans
during the second quarter of 2021 was primarily a result of PPP
loan forgiveness, loan payoffs, and paydowns on lines of credit,
partially offset by organic loan growth. Excluding the PPP, we
funded total new organic loans of $52.1 million, offset by loan
payoffs of $82.5 million. During the three months ended
June 30, 2021, $105.4 million of PPP loans were forgiven by
the SBA.
During the second quarter of 2021, we secured
new client relationships with commercial loan commitments of $19.6
million, of which $8.5 million were funded at June 30, 2021.
Our total commercial loan commitments decreased to $754.3 million
at June 30, 2021 from $915.1 million at March 31, 2021,
and the utilization rate of commercial loan commitments decreased
to 61.3% at June 30, 2021 from 65.4% at March 31, 2021.
Excluding PPP loans, total commitments decreased to $576.4 million
at June 30, 2021 from $634.5 million at March 31, 2021,
and the utilization rate of commercial loan commitments decreased
to 49.3% from 50.1% at March 31, 2021.
Deposits
|
June 30, 2021 |
|
March 31, 2021 |
|
December 31, 2020 |
Type of
Deposit |
(Dollars in thousands) |
Noninterest-bearing checking accounts |
$ |
623,215 |
|
|
$ |
649,407 |
|
|
$ |
647,115 |
|
Interest-bearing checking accounts |
199,911 |
|
|
145,728 |
|
|
129,834 |
|
Money market and savings deposits |
328,189 |
|
|
389,693 |
|
|
392,690 |
|
Certificates of deposit |
183,802 |
|
|
198,943 |
|
|
213,708 |
|
Totals |
$ |
1,335,117 |
|
|
$ |
1,383,771 |
|
|
$ |
1,383,347 |
|
The decrease in total deposits of $48.7 million,
or 3.5%, during the three months ended June 30, 2021 from
March 31, 2021 is attributable to a decrease in
noninterest-bearing checking accounts, money market and savings
deposits, and certificates of deposit, partially offset by an
increase in interest-bearing checking accounts. Noninterest-bearing
checking accounts decreased by $26.2 million, or 4.0%, money market
and savings deposits decreased by $61.5 million, or 15.8%, and
certificates of deposit decreased by $15.1 million, or 7.6%,
partially offset by an increase in interest-bearing checking
accounts of $54.2 million, or 37.2%. Lower priced core deposits
increased to 86.2% of total deposits, while higher priced
certificates of deposits decreased to 13.8% of total deposits at
June 30, 2021, as compared to 85.6% and 14.4%, respectively,
at March 31, 2021.
Asset Quality
Nonperforming Assets
|
2021 |
|
2020 |
June 30 |
|
March 31 |
|
December 31 |
|
September 30 |
|
June 30 |
|
(Dollars in thousands) |
Total nonperforming loans |
$ |
23,904 |
|
|
|
$ |
20,559 |
|
|
$ |
39,916 |
|
|
$ |
16,780 |
|
|
$ |
24,681 |
|
Other nonperforming
assets |
137 |
|
|
|
152 |
|
|
231 |
|
|
150 |
|
|
663 |
|
Total nonperforming
assets |
$ |
24,041 |
|
|
|
$ |
20,711 |
|
|
$ |
40,147 |
|
|
$ |
16,930 |
|
|
$ |
25,344 |
|
30-89 day past due loans |
$ |
2,858 |
|
|
|
$ |
1,549 |
|
|
$ |
8,992 |
|
|
$ |
25,616 |
|
|
$ |
7,175 |
|
90-day past due loans |
$ |
586 |
|
|
|
$ |
623 |
|
|
$ |
11,507 |
|
|
$ |
9,893 |
|
|
$ |
12,412 |
|
Total classified assets |
$ |
53,503 |
|
|
|
$ |
63,180 |
|
|
$ |
90,502 |
|
|
$ |
84,616 |
|
|
$ |
83,104 |
|
Allowance for loan and lease
losses |
$ |
17,268 |
|
|
|
$ |
17,127 |
|
|
$ |
17,452 |
|
|
$ |
17,485 |
|
|
$ |
18,166 |
|
Allowance for loan and lease
losses /gross loans |
1.55 |
|
% |
|
1.38 |
% |
|
1.43 |
% |
|
1.37 |
% |
|
1.33 |
% |
Allowance for loan and lease
losses /total assets |
1.13 |
|
% |
|
1.08 |
% |
|
1.10 |
% |
|
1.08 |
% |
|
1.08 |
% |
Ratio of allowance for loan
and lease losses to nonperforming loans |
72.24 |
|
% |
|
83.31 |
% |
|
43.72 |
% |
|
104.20 |
% |
|
73.60 |
% |
Ratio of nonperforming assets
to total assets |
1.57 |
|
% |
|
1.31 |
% |
|
2.53 |
% |
|
1.04 |
% |
|
1.50 |
% |
Net quarterly charge-offs to
gross loans (annualized) |
(0.05 |
) |
% |
|
0.11 |
% |
|
0.01 |
% |
|
0.21 |
% |
|
0.65 |
% |
June 30, 2021 vs March 31, 2021. Nonperforming
assets at June 30, 2021 increased by $3.3 million, or 16.1%,
from March 31, 2021. The increase in our nonperforming loans
during the three months ended June 30, 2021 resulted from the
addition of $4.5 million of commercial and consumer loans,
partially offset by principal payments of $1.1 million, transfer of
$37 thousand of loans to other assets, and charge-offs of $2
thousand. As a result of this increase in nonperforming loans, the
ratio of nonperforming assets to total assets increased from 1.31%
at March 31, 2021 to 1.57% at June 30, 2021, and the
ratio of allowance for loan and lease losses to nonperforming loans
decreased to 72.2% at June 30, 2021, from 83.3% at
March 31, 2021. Our past due loans do not include loans that
have had their payments deferred as a result of assistance being
provided under the CARES Act to our borrowers impacted by COVID-19.
As of June 30, 2021, we had 3 loans with an outstanding
balance of $5.5 million that were under a payment deferral, which
is a decrease from 16 loans with an outstanding balance of $35.5
million that were under a payment deferral as of March 31,
2021.
Our classified assets decreased by $9.7 million from $63.2
million at March 31, 2021 to $53.5 million at June 30,
2021. The decrease this quarter is primarily related to principal
payments of $11.3 million and upgraded notes of $1.3 million,
partially offset by additions of $3.1 million during the three
months ended June 30, 2021. The additions to classified loans
during the three months ended June 30, 2021 represented the
migration of loans to classified rating from loans that were
previously rated as Special Mention, or "Watch" within the Pass
category in the previous quarter.
June 30, 2021 vs June 30, 2020.
Nonperforming assets at June 30, 2021 decreased by $1.3
million from June 30, 2020 primarily as a result of a decrease
in nonperforming loans to $23.9 million in the current year from
$24.7 million the prior year. Despite this decrease to
nonperforming loans, the ratio of nonperforming assets to total
assets increased from 1.50% at June 30, 2020 to 1.57% at
June 30, 2021 due to a decrease to total assets.
Classified assets decreased by $29.6 million to
$53.5 million at June 30, 2021 from $83.1 million at
June 30, 2020. The decrease to classified loans was primarily
the result of principal payments and upgraded notes.
Allowance for Loan and Lease
Losses
|
2021 |
|
2020 |
June 30 |
|
March 31 |
|
December 31 |
|
September 30 |
|
June 30 |
|
(Dollars in thousands) |
Balance at beginning of quarter |
$ |
17,127 |
|
|
|
$ |
17,452 |
|
|
|
$ |
17,485 |
|
|
|
$ |
18,166 |
|
|
|
$ |
17,520 |
|
|
Charge offs |
(2 |
) |
|
|
(538 |
) |
|
|
(915 |
) |
|
|
(840 |
) |
|
|
(2,249 |
) |
|
Recoveries |
143 |
|
|
|
213 |
|
|
|
882 |
|
|
|
159 |
|
|
|
45 |
|
|
Provision |
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2,850 |
|
|
Balance at
end of quarter |
$ |
17,268 |
|
|
|
$ |
17,127 |
|
|
|
$ |
17,452 |
|
|
|
$ |
17,485 |
|
|
|
$ |
18,166 |
|
|
At June 30, 2021, the allowance for loan and lease losses
(“ALLL”) totaled $17.3 million, which was approximately $141
thousand more than at March 31, 2021 and $898 thousand less
than at June 30, 2020. The ALLL activity during the three
months ended June 30, 2021 included net recoveries of $141
thousand. There was no provision for loan and lease losses during
the three months ended June 30, 2021, as the result of
improved asset quality during the quarter and a decrease in the
balance of our non-PPP loan portfolio.
The ratio of the ALLL-to-total loans outstanding as of
June 30, 2021 was 1.55%, or 1.85% if the outstanding balance
of PPP loans are excluded from total loans (as PPP loans are fully
guaranteed and do not carry any allowance), as compared to 1.38%
and 1.78%, respectively, as of March 31, 2021, and 1.33% and
1.67%, respectively, as of June 30, 2020. The ratio of the
ALLL-to-total loans outstanding increased from the same quarter
prior year primarily due to the decrease in PPP loans that are 100%
guaranteed by the SBA, and have the effect of reducing the
ratio.
Capital Resources
At June 30, 2021, the Bank had total
regulatory capital of $191.1 million. The ratio of the Bank’s total
capital-to-risk weighted assets, which is a principal federal bank
regulatory measure of the financial strength of banking
institutions, was 18.0%, which exceeds the minimum for a bank to be
classified under federal bank regulatory guidelines as a
“well-capitalized” banking institution, which is the highest of the
capital standards established by federal banking regulatory
authorities.
The following table sets forth the regulatory
capital and capital ratios of the Bank at June 30, 2021, as
compared to the regulatory requirements that must be met for a
banking institution to be rated as a well-capitalized
institution.
|
ActualAt June 30, 2021 |
|
Federal Regulatory Requirementto be Rated
Well-Capitalized |
|
Amount |
|
Ratio |
|
Amount |
|
Ratio |
|
(Dollars in thousands) |
|
|
|
|
|
|
|
|
Total Capital to Risk Weighted Assets |
$ |
191,089 |
|
|
18.0 |
% |
|
$ |
106,361 |
|
|
At least 10.0% |
|
|
|
|
|
|
|
|
Common Equity Tier 1 Capital to
Risk Weighted Assets |
$ |
177,740 |
|
|
16.7 |
% |
|
$ |
69,135 |
|
|
At least 6.5% |
|
|
|
|
|
|
|
|
Tier 1 Capital to Risk Weighted
Assets |
$ |
177,740 |
|
|
16.7 |
% |
|
$ |
85,089 |
|
|
At least 8.0% |
|
|
|
|
|
|
|
|
Tier 1 Capital to Average
Assets |
$ |
177,740 |
|
|
11.3 |
% |
|
$ |
78,554 |
|
|
At least 5.0% |
About Pacific Mercantile
Bancorp
Pacific Mercantile Bancorp (Nasdaq: PMBC) is the
parent holding company of Pacific Mercantile Bank, which opened for
business March 1, 1999. The Bank, which is an FDIC insured,
California state-chartered bank and a member of the Federal Reserve
System, provides a wide range of commercial banking services to
businesses, business professionals and individual clients. The Bank
is headquartered in Orange County and operates a total of seven
offices in Southern California, located in Orange, Los Angeles, San
Diego, and San Bernardino counties. The Bank offers tailored
flexible solutions for its clients including an array of loan and
deposit products, sophisticated cash management services, and
comprehensive online banking services accessible at
www.pmbank.com.
Forward-Looking Information
This news release contains statements regarding our
expectations, beliefs and views about our proposed merger with Banc
of California, Inc. (“Banc of California”), our future financial
performance and our business, trends and expectations regarding the
markets in which we operate, and our future plans, including the
credit exposure of certain loan products and other components of
our business that could be impacted by the COVID-19 pandemic. Those
statements, which include the quotation from management, constitute
“forward-looking statements” within the meaning of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended, can be identified by
the fact that they do not relate strictly to historical or current
facts. Often, they include words such as “believe,” “expect,”
“anticipate,” “intend,” “plan,” “estimate,” “project,” or words of
similar meaning, or future or conditional verbs such as “will,”
“would,” “should,” “could,” or “may”. Forward-looking statements
are based on current information available to us and our
assumptions about future events over which we do not have control.
Moreover, our business and our markets are subject to a number of
risks and uncertainties which could cause our actual financial
performance in the future, and the future performance of our
markets (which can affect both our financial performance and the
market prices of our shares), to differ, possibly materially, from
our expectations as set forth in the forward-looking statements
contained in this news release.
In addition to the risk of incurring loan losses, which is an
inherent risk of the banking business, these risks and
uncertainties include, but are not limited to, the following: the
possibility that the merger does not close when expected or at all
because required regulatory or other approvals, financial tests or
other conditions to closing are not received or satisfied on a
timely basis or at all; changes in Banc of California’s or our
stock price before closing, including as a result of the companies’
financial performance prior to closing, general stock market
movements, and the performance of other financial companies and
peer group companies; the risk that the anticipated benefits of the
merger may not be fully realized or may take longer to realize than
expected, including as a result of changes in general economic and
market conditions, interest and exchange rates, monetary policy,
laws and regulations and their enforcement, and the degree of
competition in the geographic and business areas in which Banc of
California and we operate; Banc of California’s ability to promptly
and effectively integrate our businesses following the merger; the
reaction to the transaction of the companies’ customers, employees
and counterparties; diversion of management time on merger-related
issues; deteriorating economic conditions and macroeconomic factors
such as unemployment rates and the volume of bankruptcies, as well
as changes in monetary, fiscal or tax policy, any of which could
cause us to incur additional loan losses and adversely affect our
results of operations in the future; the risk that the credit
quality of our borrowers declines; potential declines in the value
of the collateral for secured loans; the risk that steps we have
taken to strengthen our overall credit administration are not
effective; the risk that our interest margins and, therefore, our
net interest income will be adversely affected by changes in
prevailing interest rates; the risk that we will not succeed in
further reducing our remaining nonperforming assets, in which event
we would face the prospect of further loan charge-offs and
write-downs of other real estate owned and would continue to incur
expenses associated with the management and disposition of those
assets; the risk that we will not be able to manage our interest
rate risks effectively, in which event our operating results could
be harmed; the prospect that government regulation of banking and
other financial services organizations will increase, causing our
costs of doing business to increase and restricting our ability to
take advantage of business and growth opportunities; the risk that
our efforts to develop a robust commercial banking platform may not
succeed; and the risk that we may be unable to realize our expected
level of increasing deposit inflows. Many of the foregoing risks
and uncertainties are, and will be, exacerbated by the COVID-19
pandemic and any worsening of the global business and economic
environment as a result. Readers of this news release are
encouraged to review the additional information regarding these and
other risks and uncertainties to which our business is subject that
are contained in our Annual Report on Form 10-K for the year ended
December 31, 2020, as amended which is on file with the Securities
and Exchange Commission (the “SEC”). Additional information will be
set forth in our Quarterly Report on Form 10-Q for the three and
six months ended June 30, 2021, which we expect to file with
the SEC during the third quarter of 2021, and readers of this
release are urged to review the additional information that will be
contained in that report.
Due to these and other risks and uncertainties to which our
business is subject, you are cautioned not to place undue reliance
on the forward-looking statements contained in this news release,
which speak only as of its date, or to make predictions about our
future financial performance based solely on our historical
financial performance. We disclaim any obligation to update or
revise any of the forward-looking statements as a result of new
information, future events or otherwise, except as may be required
by law.
CONSOLIDATED STATEMENTS OF
OPERATIONS (Dollars and numbers of shares in
thousands, except per share data)
(Unaudited)
|
Three Months Ended |
|
Six Months Ended |
|
June 30, 2021 |
|
March 31, 2021 |
|
June 30, 2020 |
|
Jun '21 vs Mar '21% Change |
|
Jun '21 vs Jun '20% Change |
|
June 30, 2021 |
|
June 30, 2020 |
|
% Change |
Total interest income |
$ |
12,539 |
|
|
|
$ |
13,698 |
|
|
|
$ |
15,580 |
|
|
|
(8.5 |
) |
% |
|
(19.5 |
) |
% |
|
$ |
26,237 |
|
|
|
$ |
30,349 |
|
|
|
(13.5 |
) |
% |
Total interest expense |
838 |
|
|
|
959 |
|
|
|
2,262 |
|
|
|
(12.6 |
) |
% |
|
(63.0 |
) |
% |
|
1,798 |
|
|
|
5,558 |
|
|
|
(67.7 |
) |
% |
Net interest income |
11,701 |
|
|
|
12,739 |
|
|
|
13,318 |
|
|
|
(8.1 |
) |
% |
|
(12.1 |
) |
% |
|
24,439 |
|
|
|
24,791 |
|
|
|
(1.4 |
) |
% |
Provision for loan and lease
losses |
— |
|
|
|
— |
|
|
|
2,850 |
|
|
|
— |
|
% |
|
(100.0 |
) |
% |
|
— |
|
|
|
9,050 |
|
|
|
(100.0 |
) |
% |
Net interest income after provision for loan and lease losses |
11,701 |
|
|
|
12,739 |
|
|
|
10,468 |
|
|
|
(8.1 |
) |
% |
|
11.8 |
|
% |
|
24,439 |
|
|
|
15,741 |
|
|
|
55.3 |
|
% |
Noninterest income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Service fees on deposits and other banking services |
814 |
|
|
|
819 |
|
|
|
625 |
|
|
|
(0.6 |
) |
% |
|
30.2 |
|
% |
|
1,634 |
|
|
|
1,147 |
|
|
|
42.5 |
|
% |
Net gain on sale of securities available for sale |
396 |
|
|
|
140 |
|
|
|
— |
|
|
|
— |
|
% |
|
100.0 |
|
% |
|
536 |
|
|
|
— |
|
|
|
100.0 |
|
% |
Net gain on sale of loans |
878 |
|
|
|
— |
|
|
|
— |
|
|
|
100.0 |
|
% |
|
— |
|
% |
|
878 |
|
|
|
— |
|
|
|
100.0 |
|
% |
Net loss on sale of other assets |
(47 |
) |
|
|
(45 |
) |
|
|
(53 |
) |
|
|
4.4 |
|
% |
|
(11.3 |
) |
% |
|
(93 |
) |
|
|
(47 |
) |
|
|
97.9 |
|
% |
Other noninterest income |
824 |
|
|
|
824 |
|
|
|
599 |
|
|
|
— |
|
% |
|
37.6 |
|
% |
|
1,648 |
|
|
|
1,165 |
|
|
|
41.5 |
|
% |
Total noninterest income |
2,865 |
|
|
|
1,738 |
|
|
|
1,171 |
|
|
|
64.8 |
|
% |
|
144.7 |
|
% |
|
4,603 |
|
|
|
2,265 |
|
|
|
103.2 |
|
% |
Noninterest expense: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and employee benefits |
5,517 |
|
|
|
5,661 |
|
|
|
5,462 |
|
|
|
(2.5 |
) |
% |
|
1.0 |
|
% |
|
11,178 |
|
|
|
11,531 |
|
|
|
(3.1 |
) |
% |
Occupancy and equipment |
1,238 |
|
|
|
1,151 |
|
|
|
1,176 |
|
|
|
7.6 |
|
% |
|
5.3 |
|
% |
|
2,389 |
|
|
|
2,298 |
|
|
|
4.0 |
|
% |
Professional fees |
680 |
|
|
|
882 |
|
|
|
702 |
|
|
|
(22.9 |
) |
% |
|
(3.1 |
) |
% |
|
1,562 |
|
|
|
1,563 |
|
|
|
(0.1 |
) |
% |
Merger related expenses |
584 |
|
|
|
387 |
|
|
|
— |
|
|
|
100.0 |
|
% |
|
100.0 |
|
% |
|
971 |
|
|
|
— |
|
|
|
100.0 |
|
% |
FDIC expense |
80 |
|
|
|
285 |
|
|
|
210 |
|
|
|
(71.9 |
) |
% |
|
(61.9 |
) |
% |
|
365 |
|
|
|
403 |
|
|
|
(9.4 |
) |
% |
Other noninterest expense |
1,094 |
|
|
|
1,298 |
|
|
|
1,384 |
|
|
|
(15.7 |
) |
% |
|
(21.0 |
) |
% |
|
2,392 |
|
|
|
2,856 |
|
|
|
(16.2 |
) |
% |
Total noninterest expense |
9,193 |
|
|
|
9,664 |
|
|
|
8,934 |
|
|
|
(4.9 |
) |
% |
|
2.9 |
|
% |
|
18,857 |
|
|
|
18,651 |
|
|
|
1.1 |
|
% |
Income (loss) before income taxes |
5,373 |
|
|
|
4,813 |
|
|
|
2,705 |
|
|
|
11.6 |
|
% |
|
98.6 |
|
% |
|
10,185 |
|
|
|
(645 |
) |
|
|
(1,679.1 |
) |
% |
Income tax expense
(benefit) |
1,479 |
|
|
|
1,425 |
|
|
|
800 |
|
|
|
3.8 |
|
% |
|
84.9 |
|
% |
|
2,903 |
|
|
|
(190 |
) |
|
|
(1,627.9 |
) |
% |
Net income (loss) |
$ |
3,894 |
|
|
|
$ |
3,388 |
|
|
|
$ |
1,905 |
|
|
|
14.9 |
|
% |
|
104.4 |
|
% |
|
$ |
7,282 |
|
|
|
$ |
(455 |
) |
|
|
(1,700.4 |
) |
% |
Net income (loss) allocable to common shareholders |
$ |
3,894 |
|
|
|
$ |
3,388 |
|
|
|
$ |
1,905 |
|
|
|
14.9 |
|
% |
|
104.4 |
|
% |
|
$ |
7,282 |
|
|
|
$ |
(455 |
) |
|
|
(1,700.4 |
) |
% |
Basic income per common
share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) available to common shareholders |
$ |
0.16 |
|
|
|
$ |
0.14 |
|
|
|
$ |
0.08 |
|
|
|
14.3 |
|
% |
|
100.0 |
|
% |
|
$ |
0.31 |
|
|
|
$ |
(0.02 |
) |
|
|
(1,650.0 |
) |
% |
Diluted income per common
share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) available to common shareholders |
$ |
0.16 |
|
|
|
$ |
0.14 |
|
|
|
$ |
0.08 |
|
|
|
14.3 |
|
% |
|
100.0 |
|
% |
|
$ |
0.30 |
|
|
|
$ |
(0.02 |
) |
|
|
(1,600.0 |
) |
% |
Weighted average number of
common shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
23,633 |
|
|
|
23,562 |
|
|
|
23,502 |
|
|
|
0.3 |
|
% |
|
0.6 |
|
% |
|
23,598 |
|
|
|
23,489 |
|
|
|
0.5 |
|
% |
Diluted |
23,955 |
|
|
|
23,813 |
|
|
|
23,713 |
|
|
|
0.6 |
|
% |
|
1.0 |
|
% |
|
23,886 |
|
|
|
23,489 |
|
|
|
1.7 |
|
% |
Ratios from continuing
operations(1): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average assets |
0.99 |
|
% |
|
0.89 |
|
% |
|
0.44 |
|
% |
|
|
|
|
|
0.94 |
|
% |
|
(0.06 |
) |
% |
|
|
Return on average equity |
9.53 |
|
% |
|
8.54 |
|
% |
|
5.11 |
|
% |
|
|
|
|
|
9.04 |
|
% |
|
(0.61 |
) |
% |
|
|
Efficiency ratio |
63.11 |
|
% |
|
66.75 |
|
% |
|
61.66 |
|
% |
|
|
|
|
|
64.93 |
|
% |
|
68.93 |
|
% |
|
|
____________________
(1) |
Ratios for the three months ended June 30, 2021,
March 31, 2021 and June 30, 2020, and for the six months
ended June 30, 2021 and June 30, 2020, have been
annualized. |
CONSOLIDATED STATEMENTS OF FINANCIAL
CONDITION(Dollars in thousands, except share and
book value data) (Unaudited)
ASSETS |
June 30, 2021 |
|
December 31, 2020 |
|
Increase/ (Decrease) |
|
|
Cash and due from banks |
$ |
17,085 |
|
|
$ |
12,024 |
|
|
42.1 |
|
% |
Interest bearing deposits with financial institutions(1) |
344,357 |
|
|
274,245 |
|
|
25.6 |
|
% |
Interest bearing time deposits |
1,597 |
|
|
1,597 |
|
|
— |
|
% |
Investment securities (including stock) |
32,219 |
|
|
50,093 |
|
|
(35.7 |
) |
% |
Loans
(net of allowances of $17,268 and $17,452, respectively) |
1,096,179 |
|
|
1,209,587 |
|
|
(9.4 |
) |
% |
Net
deferred tax assets |
9,395 |
|
|
8,502 |
|
|
10.5 |
|
% |
Intangible assets |
396 |
|
|
389 |
|
|
1.8 |
|
% |
Other
assets |
33,250 |
|
|
31,153 |
|
|
6.7 |
|
% |
Total assets |
$ |
1,534,478 |
|
|
$ |
1,587,590 |
|
|
(3.3 |
) |
% |
LIABILITIES AND SHAREHOLDERS’ EQUITY |
|
|
|
|
|
Noninterest bearing deposits |
$ |
623,215 |
|
|
$ |
647,115 |
|
|
(3.7 |
) |
% |
Interest bearing deposits |
|
|
|
|
|
Interest checking |
199,911 |
|
|
129,834 |
|
|
54.0 |
|
% |
Savings/money market |
328,189 |
|
|
392,690 |
|
|
(16.4 |
) |
% |
Certificates of deposit |
183,802 |
|
|
213,708 |
|
|
(14.0 |
) |
% |
Total interest bearing deposits |
711,902 |
|
|
736,232 |
|
|
(3.3 |
) |
% |
Total deposits |
1,335,117 |
|
|
1,383,347 |
|
|
(3.5 |
) |
% |
Other
borrowings |
— |
|
|
10,000 |
|
|
(100.0 |
) |
% |
Other
liabilities |
15,385 |
|
|
17,967 |
|
|
(14.4 |
) |
% |
Junior subordinated debentures |
17,527 |
|
|
17,527 |
|
|
— |
|
% |
Total liabilities |
1,368,029 |
|
|
1,428,841 |
|
|
(4.3 |
) |
% |
Shareholders’ equity |
166,449 |
|
|
158,749 |
|
|
4.9 |
|
% |
Total Liabilities and Shareholders’ Equity |
$ |
1,534,478 |
|
|
$ |
1,587,590 |
|
|
(3.3 |
) |
% |
Book
value per share |
$ |
6.97 |
|
|
$ |
6.71 |
|
|
3.9 |
|
% |
Shares outstanding, common |
23,890,780 |
|
|
23,658,415 |
|
|
1.0 |
|
% |
____________________
(1) |
Interest bearing deposits held in the Bank’s account maintained at
the Federal Reserve Bank. |
CONSOLIDATED AVERAGE BALANCES AND YIELD
DATA(Dollars in thousands)
(Unaudited)
|
Three Months Ended |
|
June 30, 2021 |
|
March 31, 2021 |
|
June 30, 2020 |
|
AverageBalance |
|
InterestEarned/Paid |
|
AverageYield/Rate |
|
AverageBalance |
|
InterestEarned/Paid |
|
AverageYield/Rate |
|
AverageBalance |
|
InterestEarned/Paid |
|
AverageYield/Rate |
Interest earning assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Short-term investments(1) |
|
257,133 |
|
|
$ |
66 |
|
|
0.10 |
% |
|
$ |
201,498 |
|
|
$ |
52 |
|
|
0.10 |
% |
|
$ |
322,023 |
|
|
$ |
79 |
|
|
0.10 |
% |
Securities available for sale and stock(2) |
|
49,765 |
|
|
317 |
|
|
2.55 |
% |
|
|
53,739 |
|
|
315 |
|
|
2.38 |
% |
|
|
35,000 |
|
|
|
210 |
|
|
2.41 |
% |
Loans(3) |
|
1,222,889 |
|
|
12,156 |
|
|
3.99 |
% |
|
|
1,250,846 |
|
|
13,331 |
|
|
4.32 |
% |
|
|
1,331,270 |
|
|
|
15,291 |
|
|
4.62 |
% |
Total interest-earning assets |
|
1,529,787 |
|
|
12,539 |
|
|
3.29 |
% |
|
|
1,506,083 |
|
|
13,698 |
|
|
3.69 |
% |
|
|
1,688,293 |
|
|
|
15,580 |
|
|
3.71 |
% |
Noninterest-earning
assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and due from banks |
|
17,997 |
|
|
|
|
|
|
|
17,800 |
|
|
|
|
|
|
|
16,622 |
|
|
|
|
|
All other assets |
|
23,438 |
|
|
|
|
|
|
|
22,788 |
|
|
|
|
|
|
|
28,048 |
|
|
|
|
|
Total assets |
$ |
1,571,222 |
|
|
|
|
|
|
$ |
1,546,671 |
|
|
|
|
|
|
$ |
1,732,963 |
|
|
|
|
|
Interest-bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing checking accounts |
$ |
193,113 |
|
|
42 |
|
|
0.09 |
% |
|
$ |
140,205 |
|
|
27 |
|
|
0.08 |
% |
|
$ |
103,164 |
|
|
|
25 |
|
|
0.10 |
% |
Money market and savings accounts |
|
368,367 |
|
|
189 |
|
|
0.21 |
% |
|
|
392,543 |
|
|
212 |
|
|
0.22 |
% |
|
|
454,877 |
|
|
|
567 |
|
|
0.50 |
% |
Certificates of deposit |
|
192,307 |
|
|
461 |
|
|
0.96 |
% |
|
|
204,600 |
|
|
586 |
|
|
1.16 |
% |
|
|
260,354 |
|
|
|
1,371 |
|
|
2.12 |
% |
Other borrowings |
|
55 |
|
|
— |
|
|
— |
% |
|
|
2,667 |
|
|
11 |
|
|
1.67 |
% |
|
|
122,015 |
|
|
|
130 |
|
|
0.43 |
% |
Junior subordinated debentures |
|
17,527 |
|
|
146 |
|
|
3.34 |
% |
|
|
17,527 |
|
|
123 |
|
|
2.85 |
% |
|
|
17,527 |
|
|
|
169 |
|
|
3.88 |
% |
Total interest bearing liabilities |
|
771,369 |
|
|
838 |
|
|
0.44 |
% |
|
|
757,542 |
|
|
959 |
|
|
0.51 |
% |
|
|
957,937 |
|
|
|
2,262 |
|
|
0.95 |
% |
Noninterest bearing
liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand deposits |
|
618,404 |
|
|
|
|
|
|
|
610,905 |
|
|
|
|
|
|
|
606,481 |
|
|
|
|
|
Accrued expenses and other
liabilities |
|
17,574 |
|
|
|
|
|
|
|
17,248 |
|
|
|
|
|
|
|
18,649 |
|
|
|
|
|
Shareholders' equity |
|
163,875 |
|
|
|
|
|
|
|
160,976 |
|
|
|
|
|
|
|
149,896 |
|
|
|
|
|
Total liabilities and
shareholders' equity |
$ |
1,571,222 |
|
|
|
|
|
|
$ |
1,546,671 |
|
|
|
|
|
|
$ |
1,732,963 |
|
|
|
|
|
Net interest income |
|
|
$ |
11,701 |
|
|
|
|
|
|
$ |
12,739 |
|
|
|
|
|
|
$ |
13,318 |
|
|
Net interest
income/spread |
|
|
|
|
2.85 |
% |
|
|
|
|
|
3.18 |
% |
|
|
|
|
|
2.76 |
% |
Net interest margin |
|
|
|
|
3.07 |
% |
|
|
|
|
|
3.43 |
% |
|
|
|
|
|
3.17 |
% |
____________________
(1) |
Short-term investments consist of federal funds sold and interest
bearing deposits that we maintain at other financial
institutions. |
(2) |
Stock consists of FHLB stock and Federal Reserve Bank of San
Francisco stock. |
(3) |
Loans include the average balance of nonaccrual loans. |
CONSOLIDATED AVERAGE BALANCES AND YIELD
DATA(Dollars in thousands)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended |
|
June 30, 2021 |
|
June 30, 2020 |
|
AverageBalance |
|
InterestEarned/Paid |
|
AverageYield/Rate |
|
AverageBalance |
|
InterestEarned/Paid |
|
AverageYield/Rate |
Interest earning assets |
|
|
|
|
|
|
|
|
|
|
|
Short-term investments(1) |
$ |
229,469 |
|
|
$ |
118 |
|
|
0.10 |
% |
|
$ |
271,310 |
|
|
$ |
800 |
|
|
0.59 |
% |
Securities available for sale and stock(2) |
51,742 |
|
|
633 |
|
|
2.47 |
% |
|
35,422 |
|
|
471 |
|
|
2.67 |
% |
Loans(3) |
1,236,790 |
|
|
25,486 |
|
|
4.16 |
% |
|
1,224,134 |
|
|
29,078 |
|
|
4.78 |
% |
Total interest-earning assets |
1,518,001 |
|
|
26,237 |
|
|
3.49 |
% |
|
1,530,866 |
|
|
30,349 |
|
|
3.99 |
% |
Noninterest-earning
assets |
|
|
|
|
|
|
|
|
|
|
|
Cash and due from banks |
17,899 |
|
|
|
|
|
|
16,698 |
|
|
|
|
|
All other assets |
23,114 |
|
|
|
|
|
|
26,601 |
|
|
|
|
|
Total assets |
1,559,014 |
|
|
|
|
|
|
1,574,165 |
|
|
|
|
|
Interest-bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing checking accounts |
$ |
166,805 |
|
|
$ |
69 |
|
|
0.08 |
% |
|
$ |
103,260 |
|
|
$ |
113 |
|
|
0.22 |
% |
Money market and savings accounts |
380,388 |
|
|
401 |
|
|
0.21 |
% |
|
435,205 |
|
|
1,864 |
|
|
0.86 |
% |
Certificates of deposit |
198,419 |
|
|
1,047 |
|
|
1.06 |
% |
|
268,200 |
|
|
2,951 |
|
|
2.21 |
% |
Other borrowings |
1,354 |
|
|
11 |
|
|
1.64 |
% |
|
77,821 |
|
|
263 |
|
|
0.68 |
% |
Junior subordinated debentures |
17,527 |
|
|
269 |
|
|
3.09 |
% |
|
17,527 |
|
|
367 |
|
|
4.21 |
% |
Total interest bearing liabilities |
764,493 |
|
|
1,797 |
|
|
0.47 |
% |
|
902,013 |
|
|
5,558 |
|
|
1.24 |
% |
Noninterest bearing
liabilities |
|
|
|
|
|
|
|
|
|
|
|
Demand deposits |
614,675 |
|
|
|
|
|
|
502,514 |
|
|
|
|
|
Accrued expenses and other
liabilities |
17,412 |
|
|
|
|
|
|
19,175 |
|
|
|
|
|
Shareholders' equity |
162,434 |
|
|
|
|
|
|
150,463 |
|
|
|
|
|
Total liabilities and
shareholders' equity |
1,559,014 |
|
|
|
|
|
|
1,574,165 |
|
|
|
|
|
Net interest income |
|
|
$ |
24,440 |
|
|
|
|
|
|
$ |
24,791 |
|
|
|
Net interest
income/spread |
|
|
|
|
3.02 |
% |
|
|
|
|
|
2.75 |
% |
Net interest margin |
|
|
|
|
3.25 |
% |
|
|
|
|
|
3.26 |
% |
____________________
(1) |
Short-term investments consist of federal funds sold and interest
bearing deposits that we maintain at other financial
institutions. |
(2) |
Stock consists of FHLB stock and Federal Reserve Bank of San
Francisco stock. |
(3) |
Loans include the average balance of nonaccrual loans. |
For more information contactCurt Christianssen,
Chief Financial Officer, 714-438-2500
Pacific Mercantile Bancorp (NASDAQ:PMBC)
Gráfica de Acción Histórica
De Nov 2024 a Dic 2024
Pacific Mercantile Bancorp (NASDAQ:PMBC)
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