CW Bancorp (OTCQX: CWBK), the parent company (“the Company”) of
CommerceWest Bank (the “Bank”) reported consolidated net income for
the second quarter of 2024 of $3,084,000 or $1.00 per diluted share
as compared to $4,214,000 or $1.27 per diluted share for the second
quarter of 2023, an EPS decrease of 21% and net income for the six
months ended June 30, 2024 of $6,077,000 or $1.96 per diluted share
as compared to $8,832,000 or $2.64 per diluted share for the six
months ended June 30, 2023, an EPS decrease of 26%.
Key Financial Results for the three months ended June 30,
2024:
- EPS of $1.00
- Return on Assets of 1.14%
- Return on Tangible Equity of 16.77%
- ACL to total loans ratio of 1.60%
- Liquid funds to total deposits ratio of 20%
- No outstanding FRB or FHLB borrowings
- Non-interest-bearing deposits to total deposits of 59%
- Strong leverage ratio of 12.06% and total risk-based capital
ratio of 19.67%
- 58 quarters of consecutive profits
Key Financial Results for the six months ended June 30,
2024:
- EPS of $1.96
- Return on Assets of 1.16%
- Return on Tangible Equity of 16.45%
- Deposit Growth of 3% as compared to March 31, 2024
- Total Asset Growth of 2.8% as compared to March 31, 2024
Mr. Ivo Tjan, Chairman and CEO commented, “The Bank had good
results with quarter over quarter average deposit growth of 8% or
$72 million and a ROTE of 16.77%.” Mr. Tjan continued, “We added
some new business development lending staff in June that is
contributing to a healthy loan pipeline, which positions us well
for loan growth in the second half of 2024. The Bank continues to
focus on growing relationships in the California business
community.”
Total Assets increased $30.7 million, an increase of 3% from the
end of the prior quarter. Total deposits increased $29.4 million as
of June 30, 2024, an increase of 3% from March 31, 2024.
Non-interest-bearing deposits decreased $4.6 million as of June 30,
2024, a decrease of 1% from the prior quarter. Interest bearing
deposits increased $34.0 million as of March 31, 2024, an increase
of 9% over the prior quarter.
Total assets decreased $50.9 million as of June 30, 2024, a
decrease of 4% as compared to the same period one year ago. Total
loans decreased $30.3 million as of June 30, 2024, a decrease of 4%
from the prior year. The Bank remains prudent and conservative
about credit quality. Cash and due from banks decreased $26.9
million or 11% over the prior year. Total investment securities
increased $3.2 million, an increase of 2% from the prior year.
Total deposits decreased $54.4 million as of June 30, 2024, a
decrease of 5% from June 30, 2023. Non-interest-bearing deposits
decreased $27.1 million as of June 30, 2024, a decrease of 4% from
the prior year. Interest bearing deposits decreased $27.3 million
as of June 30, 2024, a decrease of 6% over the prior year.
Interest income was $13,344,000 for the three months ended June
30, 2024, as compared to $13,513,000 for the three months ended
June 30, 2023, a decrease of 1%. Interest expense was $3,573,000
for the three months ended June 30, 2024, as compared to $3,113,000
for the three months ended June 30, 2023, an increase of 15%.
Interest expense was up for the quarter due to the continued
increase in the cost of deposits.
Interest income was $25,585,000 for the six months ended June
30, 2024, relatively unchanged as compared to $25,517,000 for the
six months ended June 30, 2023. Interest expense was $6,687,000 for
the six months ended June 30, 2024, as compared to $5,258,000 for
the six months ended June 30, 2023, an increase of 27%. Interest
expense was up for the first half of 2024 due to the continued
increase in the cost of deposits.
Net interest income for the three months ended June 30, 2024,
was $9,771,000 as compared to $10,400,000 for the three months
ended June 30, 2023, a decrease of 6%. The net interest margin
increased for the three months ended June 30, 2024. It increased
from 3.79% in 2023 to 3.82% in 2024, an increase of 1%. Net
interest income for the six months ended June 30, 2024, was
$18,898,000 as compared to $20,259,000 for the six months ended
June 30, 2023, a decrease of 7%. The net interest margin decreased
for the six months ended June 30, 2024. It decreased from 3.85% in
2023 to 3.80% in 2024, a decrease of 1%.
Provision for credit losses for the three months ended June 30,
2024, was zero compared to $99,000 for the three months ended June
30, 2023. Provision for credit losses for the six months ended June
30, 2024, was also zero compared to $174,000 for the six months
ended June 30, 2023.
Non-interest income for the three months ended June 30, 2024,
was $1,219,000 compared to $1,662,000 for the same period last
year, a decrease of 27%. Non-interest income for the six months
ended June 30, 2024, was $2,427,000 compared to $2,915,000 for the
same period last year, a decrease of 17%.
Non-interest expense for the three months ended June 30, 2024,
was $6,661,000 compared to $6,041,000 for the same period last
year, an increase of 10%. Non-interest expense for the six months
ended June 30, 2024, was $12,837,000 compared to $10,908,000 for
the same period last year, an increase of 18%.
The efficiency ratio for the three months ended June 30, 2024,
was 60.28% compared to 49.83% in 2023, which represents an increase
of 21%. The efficiency ratio illustrates that for every dollar made
for the three-month period ending June 30, 2024, it cost $0.6028 to
make it, as compared to $0.4983 one year ago. The efficiency ratio
for the six months ended June 30, 2024, was 59.86% compared to
46.43% in 2023, which represents an increase of 29%.
Capital ratios for the Bank remain above the levels required for
a “well capitalized” institution as designated by regulatory
agencies. As of June 30, 2024, the tier 1 leverage ratio was
12.06%, the common equity tier 1 capital ratio was 18.41%, the tier
1 risk-based capital ratio was 18.41% and the total risk-based
capital ratio was 19.67%.
CommerceWest Bank is determined to redefine banking for small
and medium sized businesses by delivering on customized products
and services. Founded in 2001 and headquartered in Irvine,
California, the Bank serves businesses throughout the state of
California with our digital banking platform. By employing a
strategically selected team of experienced professionals, we will
provide flexibility, create a complete, safe and sound banking
experience for each client. We provide a wide range of commercial
banking services, including remote deposit solution, NetBanker
online banking, mobile banking, lines of credit, M&A / working
capital loans, commercial real estate loans, SBA loans and treasury
management services.
Mission Statement: CommerceWest Bank will create a complete
banking experience for each client, catering to businesses and
their specific banking needs, while accommodating our clients and
providing them high-quality, low stress and personally tailored
banking and financial services.
Please visit www.cwbk.com to learn more about the bank. “BANK ON
THE DIFFERENCE”
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, balance
sheet management, expanded net interest margin, the ability to
control costs and expenses, interest rate changes, financial
policies of the United States government and general economic
conditions. The Company disclaims any obligation to update any such
factors or to publicly announce the results of any revisions to any
forward-looking statements contained in this release to reflect
future events or developments.
SECOND QUARTER REPORT - JUNE 30, 2024 (Unaudited) CW
BANCORP % CONSOLIDATED BALANCE SHEET
Increase (dollars in thousands)
June 30, 2024 June
30, 2023 (Decrease) ASSETS Cash and due from
banks
$
228,574
$
255,499
-11
%
Securities available for sale
121,232
102,357
18
%
Securities held-to-maturity
35,037
50,686
-31
%
Loans
716,953
747,272
-4
%
Less allowance for credit losses (ACL)
(11,489
)
(11,042
)
4
%
Loans, net
705,464
736,230
-4
%
Bank premises and equipment, net
3,984
4,683
-15
%
Other assets
36,234
31,930
13
%
Total assets
$
1,130,525
$
1,181,385
-4
%
LIABILITIES AND STOCKHOLDERS' EQUITY Non-interest bearing
deposits
$
582,750
$
609,859
-4
%
Interest bearing deposits
404,226
431,494
-6
%
Total deposits
986,976
1,041,353
-5
%
Subordinated debenture
50,000
50,000
0
%
Other liabilities
13,342
16,370
-18
%
1,050,318
1,107,723
-5
%
Stockholders' equity
80,207
73,662
9
%
Total liabilities and stockholders' equity
$
1,130,525
$
1,181,385
-4
%
Shares outstanding at end of period
3,012,375
3,235,711
Book value per share
$
29.92
$
26.18
Total loans to total deposits
72.64
%
71.76
%
ACL to total loans
1.60
%
1.49
%
Nonperforming assets (non-accrual loans & OREO)
$
4,746
$
3,182
COMMERCEWEST BANK CAPITAL
RATIOS: Tier 1 leverage ratio
12.06
%
10.79
%
Common equity tier 1 capital ratio
18.41
%
17.94
%
Tier 1 risk-based capital ratio
18.41
%
17.94
%
Total risk-based capital ratio
19.67
%
19.20
%
CW BANCORP
CONSOLIDATED STATEMENT OF INCOME (Unaudited) Three
Months Ended Increase For the Six
Months Ended Increase (dollars in thousands
except share and per share data)
June 30, 2024
June 30, 2023 (Decrease) June 30,
2024 June 30, 2023 (Decrease)
INTEREST INCOME
Loans
$
9,981
$
9,978
0
%
$
19,790
$
19,882
0
%
Investments
1,175
1,027
14
%
2,292
2,185
5
%
Fed funds sold and other
2,188
2,508
-13
%
3,503
3,450
2
%
Total interest income
13,344
13,513
-1
%
25,585
25,517
0
%
INTEREST EXPENSE
Deposits
3,104
2,644
17
%
5,749
4,311
33
%
Subordinated debenture
469
469
0
%
938
938
0
%
Other borrowings
-
-
-
-
9
-100
%
Total interest expense
3,573
3,113
15
%
6,687
5,258
27
%
NET INTEREST INCOME
BEFORE CREDIT LOSS PROVISION
9,771
10,400
-6
%
18,898
20,259
-7
%
PROVISION FOR CREDIT
LOSSES
-
99
-100
%
-
174
-100
%
Non-interest income:
NET INTEREST INCOME AFTER
CREDIT LOSS PROVISION
9,771
10,301
-5
%
18,898
20,085
-6
%
NON-INTEREST INCOME
Service Charges and Fees
on Deposits
927
1,318
-30
%
1,832
2,409
-24
%
Loss on Sale of AFS Securities
-
-
-
-
(166
)
-100
%
Other Fees
292
344
-15
%
595
672
-11
%
NON-INTEREST EXPENSE
6,661
6,041
10
%
12,837
10,908
18
%
EARNINGS BEFORE INCOME
TAXES
4,329
5,922
-27
%
8,488
12,092
-30
%
INCOME TAXES
1,245
1,708
-27
%
2,411
3,260
-26
%
NET INCOME
$
3,084
$
4,214
-27
%
$
6,077
$
8,832
-31
%
Basic earnings per share
$
1.02
$
1.29
-21
%
$
1.99
$
2.69
-26
%
Diluted earnings per share
$
1.00
$
1.27
-21
%
$
1.96
$
2.64
-26
%
Return on Assets
1.14
%
1.45
%
-21
%
1.16
%
1.57
%
-26
%
Return on Equity
16.10
%
22.87
%
-30
%
15.80
%
24.42
%
-35
%
Return on Tangible Equity
16.77
%
23.85
%
-30
%
16.45
%
25.49
%
-35
%
Efficiency Ratio
60.28
%
49.83
%
21
%
59.86
%
46.43
%
29
%
CW BANCORP CONSOLIDATED AVERAGE BALANCE SHEET and YIELD
ANALYSIS Three Months Ended June 30,
2024
2023
AverageBalance InterestIncome /Expense Yield
/Cost AverageBalance InterestIncome /Expense
Yield /Cost (dollars in thousands)
INTEREST EARNING
ASSETS Int Bearing Due from Banks & FFS
$
150,396
$
2,049
5.48
%
$
187,693
$
2,396
5.12
%
Investment Securities (1)
156,862
1,235
3.17
%
155,438
1,088
2.81
%
Loans
721,573
9,981
5.56
%
757,153
9,978
5.29
%
FHLB & Other Stocks
7,100
139
7.87
%
6,983
112
6.43
%
Total interest-earning assets
1,035,931
13,404
5.20
%
1,107,267
13,574
4.92
%
Noninterest-earning assets
48,448
61,242
Total assets
$
1,084,379
$
1,168,509
INTEREST EARNING LIABILITIES Interest Bearing
Deposits
$
380,310
$
3,104
3.28
%
$
437,694
$
2,644
2.42
%
Other Borrowings
1
-
0.00
%
-
-
-
Subordinated Debenture
50,000
469
3.75
%
50,000
469
3.75
%
Total interest-earning liabilities
430,311
3,573
3.34
%
487,694
3,113
2.56
%
Noninterest-earning liabilities Demand Deposits
563,105
593,612
Other Liabilities
13,933
13,271
Shareholders' Equity
77,030
73,932
Total liabilities and shareholder's equity
$
1,084,379
$
1,168,509
Net Interest Spread
$
9,831
1.86
%
$
10,461
2.36
%
Net Interest Margin
3.82
%
3.79
%
Total Deposits
$
943,415
$
3,104
1.32
%
$
1,031,306
$
2,644
1.03
%
Total Funding Costs
$
993,416
$
3,573
1.45
%
$
1,081,306
$
3,113
1.15
%
(1)
Amounts calculated on a fully taxable equivalent basis using
the current statutory federal tax rate
CW BANCORP
CONSOLIDATED AVERAGE BALANCE SHEET and YIELD ANALYSIS
Six Months Ended June 30,
2024
2023
AverageBalance InterestIncome /Expense Yield
/Cost AverageBalance InterestIncome /Expense
Yield /Cost (dollars in thousands)
INTEREST EARNING
ASSETS Int Bearing Due from Banks & FFS
$
118,279
$
3,217
5.47
%
$
130,527
$
3,232
4.99
%
Investment Securities (1)
158,629
2,412
3.06
%
164,012
2,338
2.87
%
Loans
721,422
19,790
5.52
%
768,619
19,882
5.22
%
FHLB & Other Stocks
7,100
286
8.10
%
6,745
218
6.52
%
Total interest-earning assets
1,005,430
25,705
5.14
%
1,069,903
25,670
4.84
%
Noninterest-earning assets
47,792
61,144
Total assets
$
1,053,222
$
1,131,047
INTEREST EARNING LIABILITIES Interest Bearing
Deposits
$
359,520
$
5,749
3.22
%
$
409,825
$
4,311
2.12
%
Other Borrowings
1
-
0.00
%
365
9
4.97
%
Subordinated Debenture
50,000
938
3.75
%
50,000
938
3.75
%
Total interest-earning liabilities
409,521
6,687
3.28
%
460,190
5,258
2.30
%
Noninterest-earning liabilities Demand Deposits
552,319
584,658
Other Liabilities
14,021
13,259
Shareholders' Equity
77,361
72,940
Total liabilities and shareholder's equity
$
1,053,222
$
1,131,047
Net Interest Spread
$
19,018
1.86
%
$
20,412
2.54
%
Net Interest Margin
3.80
%
3.85
%
Total Deposits
$
911,839
$
5,749
1.27
%
$
994,483
$
4,311
0.87
%
Total Funding Costs
$
961,840
$
6,687
1.40
%
$
1,044,848
$
5,258
1.01
%
(1)
Amounts calculated on a fully taxable equivalent basis using
the current statutory federal tax rate
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240731053378/en/
Bancorp Contact Mr. Ivo A.
Tjan, CEO Ms. Leeann Cochran, CFO Telephone: (866) 521-CWBK
E-mail: InvestorRelations@cwbk.com Website: www.cwbk.com
"Bank on the Difference"