CBB Bancorp, Inc. Reports First Quarter 2024 Financial Results

LOS ANGELES, April 26, 2024--(BUSINESS WIRE)--CBB Bancorp, Inc. ("CBB" or the "Company') (OTCQX: CBBI), the holding company of Commonwealth Business Bank, doing business as "CBB Bank" (the "Bank"), announced today net income of $5.7 million for the first quarter 2024, or $0.54 per diluted share, a decrease of 19.0% compared to $7.0 million, or $0.66 per diluted share, in the prior quarter and a decrease of 20.0% compared to $7.1 million, or $0.67 per diluted share, in the same period last year.

OVERALL RESULTS

Net income for the first quarter 2024 decreased from the prior quarter primarily due to lower net interest income, higher provision expense for credit losses offset by a negative credit loss expense related to off-balance-sheet financial instruments, and higher noninterest expenses offset by higher gain on sale of loans. The return on average assets for the first quarter 2024 was 1.32% compared to 1.54% for the fourth quarter 2023 and 1.59% for the first quarter 2023. The return on average equity for the first quarter 2024 was 9.57%, compared to 11.94% for the fourth quarter 2023 and 13.45% for the first quarter 2023. The efficiency ratio for the first quarter 2024 was 54.68%, compared to 49.45% for the fourth quarter 2023 and 51.04% for the first quarter 2023.

James Hong, President and CEO, commented, "In the present economic climate characterized by elevated interest rates, fostering growth poses a formidable challenge. However, CBB is committed to pursuing an expansion strategy in 2024, with a specific emphasis on penetrating untapped markets along the East Coast. To that end, our primary strategic objective for the forthcoming year is to establish a robust presence in the East Coast market, where we have yet to establish a foothold, but where we believe there are considerable opportunities."

INCOME STATEMENT

Net Interest Income

Net interest income for the first quarter 2024 was $15.8 million, a decrease of $1.4 million, or 7.9%, from the fourth quarter 2023, and a decrease of $3.3 million, or 17.1%, from the first quarter 2023. The decrease in net interest income compared with both the fourth quarter 2023 and the first quarter 2023 was due to relatively higher increases in interest expenses on deposits.

Net Interest Margin

The net interest margin for the first quarter 2024 was 3.77%, compared to 3.86% for the fourth quarter 2023 and 4.38% for the first quarter 2023. The decrease in the net interest margin from the prior quarter and from the same quarter of 2023 is due primarily to the rising cost of funds. The cost of funds for the first quarter 2024 increased to 3.48% compared to 3.20% for the fourth quarter 2023 and 2.10% for the first quarter 2023.

Provision for Credit Losses

Credit loss expense of a net $400 thousand was recorded for the first quarter 2024. This amount was comprised of provision expense for credit losses of $743 thousand offset by a $343 thousand reduction in ACL related to off-balance-sheet financial instruments. No provisions for credit losses was recorded for the fourth quarter 2023 or the first quarter 2023.

Refer to the financial tables in this press release for additional information and trends.

Noninterest Income

Noninterest income in the first quarter 2024 was $2.6 million, an increase of $597 thousand compared to $2.0 million for the fourth quarter 2023, and an increase of $1.5 million compared to $1.1 million in the first quarter 2023. The quarter-over-quarter increase in noninterest income was primarily the result of higher gain on sale of loans. The Bank sold approximately $28.2 million in SBA loans with an average premium of 8.4% during the first quarter 2024 compared to sale of $21.7 million in SBA loans with an average premium of 6.7% during the fourth quarter 2023. There was no sale of loans during the first quarter 2023.

Noninterest Expense

Noninterest expense for the first quarter 2024 was $10.0 million, compared to $9.5 million for the fourth quarter 2023 and $10.3 million for the first quarter 2023. Salaries and employee benefits expenses totaled $6.0 million for the first quarter 2024 compared to $5.4 million for the fourth quarter 2023 and $6.1 million for the first quarter 2023.

Please refer to financial tables in this press release for additional information and trends.

Income Taxes

The Company’s effective tax rate for the first quarter 2024 was 28.4% compared to 27.6% for fourth quarter 2023 and 28.1% for first quarter 2023.

BALANCE SHEET

Investment Securities

Investment securities were $59.1 million at March 31, 2024, a decrease of $0.7 million, or 1.2% from December 31, 2023, and a decrease of $9.8 million or 14.2% from March 31, 2023. The decreases were due to principal paydowns and an absence of portfolio additions during the first quarter of 2024. Management believes that the Bank currently has adequate liquidity and does not need to sell securities for liquidity purposes.

Loans Receivable

Loans receivable (including loans held-for-sale) at March 31, 2024, was $1.39 billion, a decrease of $29.7 million, or 2.1% from December 31, 2023, and a decrease of $74.0 million, or 5.0%, from March 31, 2023. The decrease in loans receivable since last quarter, paired with the reduction from the previous year, reflects diminished loan demand amid the prevailing high-interest rate environment.

Allowance for Credit Losses and Asset Quality

The allowance for credit losses at March 31, 2024, was $16.0 million or 1.34% of loans held-for-investment, compared to $15.3 million at December 31, 2023, or 1.27% of loans held-for-investment, and compared to $15.6 million at March 31, 2023, or 1.28% of total loans held-for-investment. Total Nonperforming assets at March 31, 2024 were $4.4 million, compared to $2.5 million at December 31, 2023, and $0.6 million at March 31, 2023. The coverage ratio of allowance for credit losses to nonperforming assets was over 360% at March 31, 2024.

SBA Loans Held-for-Sale

Total SBA loans held-for-sale at March 31, 2024, was $198.2 million, compared to $218.3 million at December 31 2023, and $243.8 million at March 31, 2023. We continue to assess SBA loan market premiums and plan to sell loans when it is advantageous to do so.

Deposits

Total deposits were $1.36 billion at March 31, 2024, down $92.6 million, or 6.4%, from December 31, 2023, and down $176.3 million, or 11.5%, from March 31, 2023. DDAs were 21.6% of total deposits for both March 31, 2024 and December 31, 2023, and 28.6% at March 31, 2023. NOW and MMDA deposits comprised 16.9% of total deposits at March 31, 2024, compared to 16.3% at December 31, 2023, and 13.8% at March 31, 2023. The quarter-over-quarter and year-over-year declines in DDAs can be attributed to the higher interest rate environment. Depositors were eager to capitalize on the rising interest rates, moving funds from DDA to Savings, MMDA, CD or some combination thereof.

Borrowings

The Bank has maintained $50.0 million of Federal Home Loan Bank advances since March 31, 2023. The blended cost of FHLB advances was 0.94% as of March 31, 2024.

Capital

Stockholders’ equity was $240.6 million at March 31, 2024, representing an increase of $4.9 million, or 2.1%, from $235.7 million at December 31, 2023. Tangible book value per share at March 31, 2024, was $22.49, compared with $22.03 at December 31, 2023, an increase of $0.46, or 2.1% per share.

Each of the Company’s and the Bank’s regulatory capital ratios increased at March 31, 2024, when compared to December 31, 2023, and March 31, 2023. Capital ratios continue to exceed the minimum levels required to be considered "Well Capitalized" under the applicable regulatory capital rules.

The Common Equity Tier 1 Risked-Based Capital Ratios at March 31, 2024, were 18.67% and 18.65% for the Company and the Bank, respectively, and Total Capital Ratios were 19.92% and 19.91% for the Company and the Bank, respectively. The Common Equity Tier 1 Risked-Based Capital Ratios at March 31, 2023, were 16.15% and 16.10% for the Company and the Bank, respectively, and Total Capital Ratios were 17.37% and 17.31% for the Company and the Bank, respectively.

About CBB Bancorp, Inc.:

CBB Bancorp, Inc. is the holding company of Commonwealth Business Bank, a full-service commercial bank which specializes in loans to small-to-medium-sized businesses and does business as "CBB Bank." As of March 31, 2024, the Bank had eleven full-service banking offices in Los Angeles and Orange Counties in California, Dallas County in Texas and Honolulu, Hawaii; two SBA regional offices in Los Angeles and Dallas Counties; and loan production offices in Georgia and Washington. For additional information, please go to www.cbb-bank.com under the tab "About Us" and select "Investor Relations" to see the 1Q 2024 Overview.

FORWARD-LOOKING STATEMENTS:

This press release includes 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. CBB Bancorp, Inc. (the "Company") intends that such forward-looking statements be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Future events are difficult to predict, and the expectations described herein are necessarily subject to risks and uncertainties that may cause actual results to differ materially and adversely from those described herein. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words "believe," "expect," "anticipate," "intend," "plan," "estimate," or words of similar meaning, or future or conditional verbs such as "will," "would," "should," "could," or "may." These forward-looking statements are not guarantees of future performance, nor should they be relied upon as representing management’s views as of any subsequent date. Factors that might cause actual results to differ materially from those presented, either expressed or implied, in this news release include, but are not limited to: the Company’s ability to successfully execute its business plans and achieve its objectives; changes in general economic and financial market conditions, either nationally or locally in areas in which the Company conducts its operations; changes in interest rates; continuing consolidation in the financial services industry; new litigation or changes in existing litigation; increased competitive challenges and expanding product and pricing pressures among financial institutions; legislation or regulatory changes which adversely affect the Company’s operations or business; loss of key personnel; and changes in accounting policies or procedures as may be required by the Financial Accounting Standards Board or other regulatory agencies.

The Company undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances, except to the extent required by law.

Schedules and Financial Data: All tables and data to follow

STATEMENT OF INCOME AND PERFORMANCE HIGHLIGHT (Unaudited) - Table 1
(Dollars in thousands, except per share amounts)
		Three Months Ended
		March 31,				December 31,				$				%			March 31,				$				%
		2024				2023				Change				Change			2023				Change				Change
Interest income		$	28,463			$	29,624			$	(1,161	)		(3.9	%)		$	27,248			$	1,215			4.5	%
Interest expense			12,655				12,462				193			1.5	%			8,168				4,487			54.9	%
Net interest income			15,808				17,162				(1,354	)		(7.9	%)			19,080				(3,272	)		(17.1	%)
Provision for credit losses			400				-				400			100.0	%			-				400			100.0	%
Net interest income after provision for credit losses			15,408				17,162				(1,754	)		(10.2	%)			19,080				(3,672	)		(19.2	%)
Gain on sale of loans			1,489				838				651			77.7	%			-				1,489			100.0	%
SBA servicing fee income, net			643				690				(47	)		(6.8	%)			654				(11	)		(1.7	%)
Service charges and other income			429				436				(7	)		(1.6	%)			398				31			7.8	%
Noninterest income			2,561				1,964				597			30.4	%			1,052				1,509			143.4	%
Salaries and employee benefits			6,024				5,356				668			12.5	%			6,079				(55	)		(0.9	%)
Occupancy and equipment			1,122				1,128				(6	)		(0.5	%)			1,124				(2	)		(0.2	%)
Marketing expense			402				250				152			60.8	%			374				28			7.5	%
Professional expense			412				360				52			14.4	%			454				(42	)		(9.3	%)
Other expenses			2,084				2,363				(279	)		(11.8	%)			2,244				(160	)		(7.1	%)
Noninterest expense			10,044				9,457				587			6.2	%			10,275				(231	)		(2.2	%)
Income before income tax provision			7,925				9,669				(1,744	)		(18.0	%)			9,857				(1,932	)		(19.6	%)
Income tax provision			2,253				2,670				(417	)		(15.6	%)			2,767				(514	)		(18.6	%)
Net income		$	5,672			$	6,999			$	(1,327	)		(19.0	%)		$	7,090			$	(1,418	)		(20.0	%)
Effective tax rate			28.4	%			27.6	%			0.8	%		3.0	%			28.1	%			0.4	%		1.3	%
Outstanding number of shares			10,588,136				10,588,136				-			-				10,588,136				-			-
Weighted average shares for basic EPS			10,588,136				10,588,136				-			-				10,576,191				11,945			0.1	%
Weighted average shares for diluted EPS			10,588,688				10,588,937				(249	)		(0.0	%)			10,600,189				(11,501	)		(0.1	%)
Basic EPS		$	0.54			$	0.66			$	(0.12	)		(18.2	%)		$	0.67			$	(0.13	)		(19.4	%)
Diluted EPS		$	0.54			$	0.66			$	(0.12	)		(18.2	%)		$	0.67			$	(0.13	)		(19.4	%)
Return on average assets			1.32	%			1.54	%			(0.22	%)		(14.3	%)			1.59	%			(0.27	%)		(17.0	%)
Return on average equity			9.57	%			11.94	%			(2.37	%)		(19.9	%)			13.45	%			(3.88	%)		(28.9	%)
Efficiency ratio¹			54.68	%			49.45	%			5.23	%		10.6	%			51.04	%			3.64	%		7.1	%
Yield on interest-earning assets²			6.77	%			6.65	%			0.12	%		1.8	%			6.24	%			0.53	%		8.5	%
Cost of funds			3.48	%			3.20	%			0.28	%		8.8	%			2.10	%			1.38	%		65.7	%
Net interest margin²			3.77	%			3.86	%			(0.09	%)		(2.3	%)			4.38	%			(0.61	%)		(13.9	%)

¹		Represents the ratio of noninterest expense less other real estate owned operations to the sum of net interest income before provision for credit losses and total noninterest income.
²		Amounts calculated on a fully taxable equivalent basis using the current statutory federal tax rate

BALANCE SHEET, CAPITAL AND OTHER DATA (Unaudited) - Table 2
(Dollars in thousands)
		March 31,				December 31,				$				%			March 31,				$				%
		2024				2023				Change				Change			2023				Change				Change
ASSETS
Cash and due from banks		$	11,612			$	14,282			$	(2,670	)		(18.7	%)		$	13,788			$	(2,176	)		(15.8	%)
Interest-earning deposits at the FRB and other banks			181,366				233,255				(51,889	)		(22.2	%)			240,602				(59,236	)		(24.6	%)
Investment securities¹			59,143				59,883				(740	)		(1.2	%)			68,943				(9,800	)		(14.2	%)
Loans held-for-sale			198,167				218,258				(20,091	)		(9.2	%)			243,753				(45,586	)		(18.7	%)
Loans held-for-investment			1,194,439				1,204,009				(9,570	)		(0.8	%)			1,222,867				(28,428	)		(2.3	%)
Less: Allowance for credit losses ("ACL")			(16,048	)			(15,291	)			(757	)		(5.0	%)			(15,627	)			(421	)		(2.7	%)
Loans held-for-investment, net			1,178,391				1,188,718				(10,327	)		(0.9	%)			1,207,240				(28,849	)		(2.4	%)
Other real estate owned ("OREO")			-				55				(55	)		-100.0	%			-				-			-
Restricted stock investments			11,011				11,011				-			-				10,121				890			8.8	%
Servicing assets			7,560				7,673				(113	)		(1.5	%)			8,528				(968	)		(11.4	%)
Goodwill			2,185				2,185				-			-				2,185				-			-
Intangible assets			245				255				(10	)		(3.9	%)			291				(46	)		(15.8	%)
Other assets			23,581				24,838				(1,257	)		(5.1	%)			25,697				(2,116	)		(8.2	%)
Total assets		$	1,673,261			$	1,760,413			$	(87,152	)		(5.0	%)		$	1,821,148			$	(147,887	)		(8.1	%)
LIABILITIES AND STOCKHOLDERS' EQUITY
Noninterest-bearing		$	286,766			$	305,923			$	(19,157	)		(6.3	%)		$	428,559			$	(141,793	)		(33.1	%)
Interest-bearing			1,074,198				1,147,662				(73,464	)		(6.4	%)			1,108,754				(34,556	)		(3.1	%)
Total deposits			1,360,964				1,453,585				(92,621	)		(6.4	%)			1,537,313				(176,349	)		(11.5	%)
FHLB advances and other borrowing			50,000				50,000				-			-				50,000				-			-
Other liabilities			21,727				21,114				613			2.9	%			17,651				4,076			23.1	%
Total liabilities			1,432,691				1,524,699				(92,008	)		(6.0	%)			1,604,964				(172,273	)		(10.7	%)
Stockholders' Equity			240,570				235,714				4,856			2.1	%			216,184				24,386			11.3	%
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY		$	1,673,261			$	1,760,413			$	(87,152	)		(5.0	%)		$	1,821,148			$	(147,887	)		(8.1	%)
CAPITAL RATIOS
Leverage ratio
Company			13.85	%			12.98	%			0.88	%		6.8	%			11.86	%			1.99	%		16.8	%
Bank			13.84	%			12.96	%			0.88	%		6.8	%			11.82	%			2.02	%		17.1	%
Common equity tier 1 risk-based capital ratio
Company			18.67	%			18.08	%			0.60	%		3.3	%			16.15	%			2.52	%		15.6	%
Bank			18.65	%			18.05	%			0.61	%		3.4	%			16.10	%			2.56	%		15.9	%
Tier 1 risk-based capital ratio
Company			18.67	%			18.08	%			0.60	%		3.3	%			16.15	%			2.52	%		15.6	%
Bank			18.65	%			18.05	%			0.61	%		3.4	%			16.10	%			2.56	%		15.9	%
Total risk-based capital ratio
Company			19.92	%			19.30	%			0.63	%		3.2	%			17.37	%			2.56	%		14.7	%
Bank			19.91	%			19.27	%			0.63	%		3.3	%			17.31	%			2.59	%		15.0	%
Tangible book value per share		$	22.49			$	22.03			$	0.46			2.1	%		$	20.18			$	2.31			11.5	%
Loans Held for Investments-to-Deposit ("LHFITD") ratio			87.76	%			82.83	%			4.93	%		6.0	%			79.55	%			8.21	%		10.3	%
Net Loan-to-Deposit ("LTD") ratio			101.15	%			96.79	%			4.36	%		4.5	%			94.39	%			6.76	%		7.2	%
Nonperforming assets		$	4,447			$	2,484			$	1,963			79.0	%		$	636			$	3,811			599.2	%
Nonperforming assets as a % of loans held-for-investment			0.37	%			0.21	%			0.16	%		76.2	%			0.05	%			0.32	%		640.0	%
ACL as a % of loans held-for-investment			1.34	%			1.27	%			0.07	%		5.51	%			1.28	%			0.06	%		4.7	%

¹		Includes AFS and HTM

FIVE-QUARTER STATEMENT OF INCOME (Unaudited) - Table 3
(Dollars in thousands, except per share amounts)
		Three Months Ended
		March 31,				December 31,				September 30,				June 30,				March 31,
		2024				2023				2023				2023				2023
Interest income		$	28,463			$	29,624			$	29,450			$	28,664			$	27,248
Interest expense			12,655				12,462				11,442				9,930				8,168
Net interest income			15,808				17,162				18,008				18,734				19,080
Provision for credit losses			400				-				-				-				-
Net interest income after provision for credit losses			15,408				17,162				18,008				18,734				19,080
Gain on sale of loans			1,489				838				419				1,952				-
SBA servicing fee income, net			643				690				639				440				654
Service charges and other income			429				436				402				407				398
Noninterest income			2,561				1,964				1,460				2,799				1,052
Salaries and employee benefits			6,024				5,356				5,569				5,581				6,079
Occupancy and equipment			1,122				1,128				1,103				1,122				1,124
Marketing expense			402				250				475				409				374
Professional expense			412				360				443				436				454
Other expenses			2,084				2,363				2,579				2,635				2,244
Noninterest expense			10,044				9,457				10,169				10,183				10,275
Income before income tax expense			7,925				9,669				9,299				11,350				9,857
Income tax expense			2,253				2,670				2,630				3,248				2,767
Net income		$	5,672			$	6,999			$	6,669			$	8,102			$	7,090
Effective tax rate			28.4	%			27.6	%			28.3	%			28.6	%			28.1	%
Outstanding number of shares			10,588,136				10,588,136				10,588,136				10,588,136				10,588,136
Weighted average shares for basic EPS			10,588,136				10,588,136				10,588,136				10,588,136				10,576,191
Weighted average shares for diluted EPS			10,588,688				10,588,937				10,594,155				10,591,351				10,600,189
Basic EPS		$	0.54			$	0.66			$	0.63			$	0.77			$	0.67
Diluted EPS		$	0.54			$	0.66			$	0.63			$	0.76			$	0.67

FIVE-QUARTER SALARIES BENEFIT METRICS (Unaudited) - Table 4
(Dollars in thousands)
		At or for the Three Months Ended
		March 31,				December 31,				September 30,				June 30,				March 31,
		2024				2023				2023				2023				2023
Salaries and benefits		$	6,024			$	5,356			$	5,569			$	5,581			$	6,079
FTE at the end of period			168				169				172				165				170
Average FTE during the period			169				169				168				164				174
Salaries and benefits/average FTE¹		$	143			$	126			$	131			$	137			$	142
Salaries and benefits/average assets¹			1.41	%			1.18	%			1.22	%			1.23	%			1.36	%
Noninterest expense/average assets¹			2.35	%			2.08	%			2.22	%			2.25	%			2.30	%

¹		Annualized

FIVE-QUARTER BALANCE SHEET (Unaudited) - Table 5
(Dollars in thousands)
		March 31,				December 31,				September 30,				June 30,				March 31,
		2024				2023				2023				2023				2023
ASSETS
Cash and due from banks		$	11,612			$	14,282			$	11,188			$	12,704			$	13,788
Interest-earning deposits at the FRB and other banks			181,366				233,255				335,016				293,394				240,602
Investment securities			59,143				59,883				61,617				66,400				68,943
Loans held-for-sale			198,167				218,258				219,355				215,083				243,753
Loans held-for-investment			1,194,439				1,204,009				1,201,230				1,201,237				1,222,867
Less: Allowance for credit losses			(16,048	)			(15,291	)			(15,284	)			(15,626	)			(15,627	)
Loans held-for-investment, net			1,178,391				1,188,718				1,185,946				1,185,611				1,207,240
Other real estate owned			-				55				55				-				-
Restricted stock investments			11,011				11,011				11,011				11,011				10,121
Servicing assets			7,560				7,673				7,873				8,426				8,528
Goodwill			2,185				2,185				2,185				2,185				2,185
Intangible assets			245				255				267				279				291
Other assets			23,581				24,838				24,799				24,537				25,697
Total assets		$	1,673,261			$	1,760,413			$	1,859,312			$	1,819,630			$	1,821,148
LIABILITIES AND STOCKHOLDERS' EQUITY
Noninterest-bearing		$	286,766			$	305,923			$	406,033			$	426,333			$	428,559
Interest-bearing			1,074,198				1,147,662				1,143,257				1,096,078				1,108,754
Total deposits			1,360,964				1,453,585				1,549,290				1,522,411				1,537,313
FHLB advances			50,000				50,000				50,000				50,000				50,000
Other liabilities			21,727				21,114				31,141				23,956				17,651
Total liabilities			1,432,691				1,524,699				1,630,431				1,596,367				1,604,964
Stockholders' Equity			240,570				235,714				228,881				223,263				216,184
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY		$	1,673,261			$	1,760,413			$	1,859,312			$	1,819,630			$	1,821,148

FIVE-QUARTER LOANS RECEIVABLE COMPONENTS (Unaudited) - Table 6
(Dollars in thousands)
		March 31, 2024						December 31, 2023						September 30, 2023						June 30, 2023						March 31, 2023
		Balance			%			Balance			%			Balance			%			Balance			%			Balance			%
Construction		$	37,216		3.1	%		$	34,886		2.9	%		$	30,924		2.6	%		$	20,106		1.7	%		$	19,550		1.6	%
Commercial real estate			1,005,765		84.2	%			1,010,495		83.9	%			1,005,735		83.7	%			1,014,785		84.5	%			1,033,124		84.5	%
Commercial and industrial			101,784		8.5	%			108,123		9.0	%			113,374		9.4	%			114,106		9.4	%			114,184		9.3	%
Home mortgage			44,389		3.7	%			44,920		3.7	%			45,452		3.8	%			45,987		3.8	%			49,155		4.0	%
Consumer			668		0.1	%			630		0.1	%			616		0.1	%			1,074		0.1	%			1,049		0.1	%
Gross loans held-for-investment			1,189,822		99.6	%			1,199,054		99.6	%			1,196,101		99.6	%			1,196,058		99.6	%			1,217,062		99.5	%
Deferred loan fees/costs, net			4,617		0.4	%			4,955		0.4	%			5,129		0.4	%			5,179		0.4	%			5,805		0.5	%
Loans held-for-investment		$	1,194,439		100.0	%		$	1,204,009		100.0	%		$	1,201,230		100.0	%		$	1,201,237		100.0	%		$	1,222,867		100.0	%
Loans held-for-sale		$	198,167					$	218,258					$	219,355					$	215,083					$	243,753
Total loans receivable		$	1,392,606					$	1,422,267					$	1,420,585					$	1,416,320					$	1,466,620

FIVE-QUARTER SBA LOAN PRODUCTIONS/SALES DATA (Unaudited) - Table 7
(Dollars in thousands)
		Three Months Ended
		March 31,				December 31,				September 30,				June 30,				March 31,
		2024				2023				2023				2023				2023
SBA loans held-for-sale at beginning of the quarter/year		$	218,258			$	219,355			$	215,083			$	243,753			$	230,431
SBA loans originated/transferred from/to held-for-investment during the quarter/year			14,589				27,022				16,260				18,273				16,890
SBA loans sold during the quarter/year			(28,164	)			(21,749	)			(9,245	)			(42,437	)			-
SBA loans principal paydown/payoff, net of advance			(6,516	)			(6,370	)			(2,743	)			(4,506	)			(3,568	)
SBA loans held-for-sale at end of the quarter/year		$	198,167			$	218,258			$	219,355			$	215,083			$	243,753
Gain on sale of SBA loans		$	1,489			$	838			$	419			$	1,952			$	-
Premium on sale (weighted average)			8.4	%			6.7	%			6.8	%			-				-
SBA loan production		$	18,089			$	37,821			$	24,270			$	24,013			$	21,719

FIVE QUARTER SBA SERVICING ASSETS AND SERVICING FEES (Unaudited) - Table 8
(Dollars in thousands)
		Three Months Ended
		March 31,				December 31,				September 30,				June 30,				March 31,
		2024				2023				2023				2023				2023
SBA servicing assets @ beginning of the quarter/year		$	7,673			$	7,873			$	8,426			$	8,528			$	9,232
Newly added SBA servicing assets from SBA loans sold			555				430				182				806				-
Regular quarterly/annual servicing assets amortization			(332	)			(356	)			(371	)			(379	)			(403	)
SBA servicing assets amortized from SBA loans paid off/charged off			(336	)			(274	)			(364	)			(529	)			(301	)
Subtotal before impairment			7,560				7,673				7,873				8,426				8,528
Reversal of valuation allowance on servicing assets			-				-				-				-				-
SBA servicing assets @ the end of the quarter/year		$	7,560			$	7,673			$	7,873			$	8,426			$	8,528

FIVE-QUARTER DEPOSIT COMPONENTS (Unaudited) - Table 9
(Dollars in thousands)
		March 31, 2024						December 31, 2023						September 30, 2023						June 30, 2023						March 31, 2023
		Balance			%			Balance			%			Balance			%			Balance			%			Balance			%
Noninterest-bearing demand		$	286,766		21.1	%		$	305,923		21.1	%		$	406,033		26.2	%		$	426,333		28.0	%		$	428,559		27.9	%
Interest-bearing demand			6,709		0.5	%			7,504		0.5	%			6,395		0.4	%			9,056		0.6	%			10,883		0.7	%
NOW & MMDA			229,642		16.9	%			237,548		16.3	%			227,283		14.7	%			210,429		13.8	%			211,793		13.8	%
Savings			84,999		6.2	%			88,689		6.1	%			78,969		5.1	%			62,324		4.1	%			62,188		4.0	%
TCDs of $250K and under			299,944		22.0	%			315,920		21.7	%			312,704		20.2	%			298,520		19.6	%			294,074		19.1	%
TCDs of $250K over			339,482		25.0	%			353,866		24.4	%			373,345		24.1	%			368,262		24.2	%			367,167		23.9	%
Wholesale TCDs			113,422		8.3	%			144,135		9.9	%			144,561		9.3	%			147,487		9.7	%			162,649		10.6	%
Total Deposits		$	1,360,964		100.0	%		$	1,453,585		100.0	%		$	1,549,290		100.0	%		$	1,522,411		100.0	%		$	1,537,313		100.0	%
Recap:
Noninterest-bearing demand		$	286,766		21.1	%		$	305,923		21.0	%		$	406,033		26.2	%		$	426,333		28.0	%		$	428,559		27.9	%
Interest-bearing demand			6,709		0.5	%			7,504		0.5	%			6,395		0.4	%			9,056		0.6	%			10,883		0.7	%
NOW & MMDA			229,642		16.9	%			237,548		16.3	%			227,283		14.7	%			210,429		13.8	%			211,793		13.8	%
Savings			84,999		6.2	%			88,689		6.1	%			78,969		5.1	%			62,324		4.1	%			62,188		4.0	%
TCDs of $250K and under			299,944		22.0	%			315,920		21.7	%			312,704		20.2	%			298,520		19.6	%			294,074		19.1	%
Core Deposits			908,060		66.7	%			955,584		65.7	%			1,031,384		66.6	%			1,006,662		66.1	%			1,007,497		65.5	%
TCDs of $250K over			339,482		24.9	%			353,866		24.3	%			373,345		24.1	%			368,262		24.2	%			367,167		23.9	%
Wholesale TCDs			113,422		8.3	%			144,135		9.9	%			144,561		9.3	%			147,487		9.7	%			162,649		10.6	%
Noncore Deposits			452,904		33.3	%			498,001		34.3	%			517,906		33.4	%			515,749		33.9	%			529,816		34.5	%
Total Deposits		$	1,360,964		100.0	%		$	1,453,585		100.0	%		$	1,549,290		100.0	%		$	1,522,411		100.0	%		$	1,537,313		100.0	%

FIVE-QUARTER SELECTED LOAN AND ASSET QUALITY HIGHLIGHTS (Unaudited) - Table 10
(Dollars in thousands)
		1st Qtr.				4th Qtr.				3rd Qtr.				2nd Qtr.				1st Qtr.
		2024				2023				2023				2023				2023
Allowance for Credit Losses
Balance at beginning of period		$	15,291			$	15,284			$	15,626			$	15,627			$	15,525
CECL transition provision			-				-				-				-				250
Provision for credit losses			743				-				-				-				-
Charge-offs							(2	)			(350	)			(11	)			(159	)
Recoveries			14				9				8				10				11
Balance at the end of period		$	16,048			$	15,291			$	15,284			$	15,626			$	15,627
Nonperforming Assets:¹
Over 90 days still accruing		$	1,605			$	399			$	2			$	39			$	-
Nonaccrual loans			2,842				2,030				616				645				636
Total nonperforming loans			4,447				2,429				618				684				636
Other real estate owned		$	-				55				55				-				-
Total nonperforming assets		$	4,447			$	2,484			$	673			$	684			$	636
Classified Assets:¹
Substandard		$	11,912			$	11,063			$	10,105			$	10,491			$	7,673
Doubtful			-				-				-				-				-
Loss
Total classified loans		$	11,912			$	11,063			$	10,105			$	10,491			$	7,673
Other real estate owned		$	-				55				55				-				-
Total classified assets		$	11,912			$	11,118			$	10,160			$	10,491			$	7,673
Performing TDR loans:¹		$	3,811			$	3,336			$	3,336			$	3,336			$	-
Delinquent Loans:¹
Loans 30-89 days past due		$	16,907			$	5,981			$	10,620			$	4,420			$	3,551
90 days or more past due and still accruing			1,605				399				2				39				-
Nonaccrual			2,842				2,030				616				645				636
Total delinquent loans		$	21,354			$	8,410			$	11,238			$	5,104			$	4,187
Asset Quality Ratios:
Net (recoveries) charge-offs to average loans²			0.00	%			0.00	%			0.10	%			0.00	%			0.04	%
Nonaccrual loans to loans held-for-investment			0.24	%			0.17	%			0.05	%			0.05	%			0.05	%
Nonperforming loans to loans held-for-investment			0.37	%			0.20	%			0.05	%			0.06	%			0.05	%
Nonperforming assets to total assets			0.27	%			0.14	%			0.04	%			0.04	%			0.03	%
Classified loans to loans held-for-investment			1.00	%			0.92	%			0.84	%			0.87	%			0.63	%
Classified loans to Tier 1 and ACL			4.69	%			4.45	%			4.18	%			4.44	%			3.35	%
Classified assets to total assets			0.71	%			0.63	%			0.55	%			0.58	%			0.42	%
Classified assets to Tier 1 and ACL			4.69	%			4.47	%			4.20	%			4.44	%			3.35	%
ACL to loans held-for-investment			1.34	%			1.27	%			1.27	%			1.30	%			1.28	%
ACL to nonaccrual loans			564.67	%			753.25	%			2481.17	%			2422.64	%			2457.08	%
ACL to nonperforming loans			360.87	%			629.52	%			2473.14	%			2284.50	%			2457.08	%
ACL to nonperforming assets			360.87	%			615.58	%			2271.03	%			2284.50	%			2457.08	%
Texas ratio ³			1.75	%			1.00	%			0.28	%			0.29	%			0.28	%

¹		Net of SBA guaranteed balance
²		Includes loans held-for-sale
³		Nonperforming assets divided by tangible common equity and ACL

FIVE-QUARTER CAPITAL RATIOS (Unaudited) - Table 11
		Well Capitalized			Adequately Capitalized			March 31,				December 31,				September 30,				June 30,				March 31,
		Regulatory			BASEL III
		Requirement			Fully Phased In			2024				2023				2023				2023				2023
Leverage ratio
Company		N/A			N/A				13.85	%			12.98	%			12.53	%			12.23	%			11.86	%
Bank		5.00	%		4.00	%			13.84	%			12.96	%			12.50	%			12.20	%			11.82	%
Common equity tier 1 risk-based capital ratio
Company		N/A			N/A				18.67	%			18.08	%			17.61	%			17.08	%			16.15	%
Bank		6.50	%		7.00	%			18.65	%			18.05	%			17.57	%			17.03	%			16.10	%
Tier 1 risk-based capital ratio
Company		N/A			N/A				18.67	%			18.08	%			17.61	%			17.08	%			16.15	%
Bank		8.00	%		8.50	%			18.65	%			18.05	%			17.57	%			17.03	%			16.10	%
Total risk-based capital ratio
Company		N/A			N/A				19.92	%			19.30	%			18.83	%			18.32	%			17.37	%
Bank		10.00	%		10.50	%			19.91	%			19.27	%			18.79	%			18.27	%			17.31	%
Tangible common equity/total assets									14.25	%			13.27	%			12.19	%			12.15	%			11.75	%
Tangible common equity per share								$	22.49			$	22.03			$	21.39			$	20.85			$	20.18

FIVE-QUARTER MARGIN ANALYSIS (Unaudited) -Table 12
(Dollars in thousands)
		Three Months Ended
		March 31, 2024										December 31, 2023										September 30, 2023										June 30, 2023										March 31, 2023
		Avg Balance				Interest			Yield			Avg Balance				Interest			Yield			Avg Balance				Interest			Yield			Avg Balance				Interest			Yield			Avg Balance				Interest			Yield
Number of Days in the Period
INTEREST-EARNING ASSETS
Loans Receivable¹		$	1,415,924			$	24,906		7.07	%		$	1,410,971			$	24,926		7.01	%		$	1,417,148			$	24,734		6.92	%		$	1,444,608			$	24,661		6.85	%		$	1,502,078			$	24,379		6.58	%
Investment securities ²			59,554				575		3.88	%			60,094				563		3.72	%			64,587				577		3.54	%			67,958				595		3.51	%			70,146				577		3.34	%
Interest-earning deposits at the FRB and other banks			207,155				2,817		5.47	%			288,769				3,973		5.46	%			293,081				3,994		5.41	%			258,236				3,296		5.12	%			190,692				2,178		4.63	%
Other earning assets			11,011				214		7.82	%			11,011				212		7.64	%			11,011				196		7.06	%			10,825				163		6.04	%			10,121				164		6.57	%
Total interest-earning assets ²			1,693,644				28,512		6.77	%			1,770,845				29,674		6.65	%			1,785,827				29,501		6.55	%			1,781,627				28,715		6.46	%			1,773,037				27,298		6.24	%
NONINTEREST-EARNING ASSETS
Cash and due from banks			12,172										12,567										13,045										12,792										14,262
Other noninterest-earning assets			31,967										32,985										33,331										34,060										36,643
Total noninterest-earning assets			44,139										45,552										46,376										46,852										50,905
Less: Allowance for credit losses			(15,322	)									(15,291	)									(15,622	)									(15,627	)									(15,552	)
TOTAL ASSETS		$	1,722,461									$	1,801,106									$	1,816,581									$	1,812,852									$	1,808,390
INTEREST-BEARING DEPOSITS
Interest-bearing demand		$	12,680			$	6		0.19	%		$	12,657			$	7		0.22	%		$	12,347			$	6		0.19	%		$	14,522			$	7		0.19	%		$	18,021			$	9		0.20	%
Money market			229,441				2,285		4.01	%			222,289				2,158		3.85	%			211,152				1,907		3.58	%			192,872				1,414		2.94	%			231,865				1,469		2.57	%
Savings			84,854				724		3.43	%			82,403				664		3.20	%			70,579				494		2.78	%			63,786				324		2.04	%			55,576				164		1.20	%
Time deposits			801,122				9,523		4.78	%			824,900				9,515		4.58	%			820,335				8,916		4.31	%			839,198				8,068		3.86	%			797,072				6,410		3.26	%
Total interest-bearing deposits			1,128,097				12,538		4.47	%			1,142,249				12,344		4.29	%			1,114,413				11,323		4.03	%			1,110,378				9,813		3.54	%			1,102,534				8,052		2.96	%
Borrowings			50,000				117		0.94	%			50,001				118		0.94	%			50,001				119		0.94	%			50,000				117		0.94	%			50,000				116		0.94	%
Total interest-bearing liabilities			1,178,097				12,655		4.32	%			1,192,250				12,462		4.15	%			1,164,414				11,442		3.90	%			1,160,378				9,930		3.43	%			1,152,534				8,168		2.87	%
Noninterest-bearing deposits			284,867										350,656										397,791										411,432										425,190
Other liabilities			21,112										25,602										27,519										20,934										16,947
Stockholders' equity			238,385										232,598										226,857										220,108										213,719
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY		$	1,722,461									$	1,801,106									$	1,816,581									$	1,812,852									$	1,808,390
Net interest income²						$	15,857									$	17,212									$	18,059									$	18,785									$	19,130
Net interest spread									2.45	%									2.50	%									2.65	%									3.03	%									3.37	%
Effect of noninterest-bearing sources									1.32	%									1.36	%									1.36	%									1.20	%									1.01	%
Net interest margin²									3.77	%									3.86	%									4.01	%									4.23	%									4.38	%
Cost of deposits		$	1,412,964			$	12,538		3.57	%		$	1,492,905			$	12,344		3.28	%		$	1,512,204			$	11,323		2.97	%		$	1,521,810			$	9,813		2.59	%		$	1,527,724			$	8,052		2.14	%
Cost of funds		$	1,462,964			$	12,655		3.48	%		$	1,542,906			$	12,462		3.20	%		$	1,562,205			$	11,442		2.91	%		$	1,571,810			$	9,930		2.53	%		$	1,577,724			$	8,168		2.10	%

FIVE-QUARTER COMPONENTS OF YIELD ON LOANS (Unaudited) - Table 13
(Dollars in thousands)
		Three Months Ended
		March 31, 2024							December 31, 2023							September 30, 2023							June 30, 2023							March 31, 2023
		Amount				Yield			Amount				Yield			Amount				Yield			Amount				Yield			Amount				Yield
Contractual yield		$	24,138			6.86	%		$	24,235			6.81	%		$	23,932			6.70	%		$	23,767			6.60	%		$	23,643			6.38	%
SBA discount accretion			926			0.26	%			845			0.24	%			921			0.25	%			1,124			0.31	%			937			0.25	%
Prepayment penalties and late fees			67			0.01	%			40			0.01	%			18			0.01	%			60			0.02	%			30			0.01	%
Amortization of net deferred costs			(225	)		-0.06	%			(194	)		-0.05	%			(137	)		-0.04	%			(290	)		-0.08	%			(231	)		-0.06	%
As reported yield on loans		$	24,906			7.07	%		$	24,926			7.01	%		$	24,734			6.92	%		$	24,661			6.85	%		$	24,379			6.58	%

View source version on businesswire.com: https://www.businesswire.com/news/home/20240426093642/en/

Contacts

Richard Koh, EVP & CFO
(323) 988-3037
RichardK@cbb-bank.com