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Cornerstone Community Bancorp Reports Financial Results For the First Quarter Ended March 31, 2021

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Cornerstone Community Bancorp (OTC Pink: CRSB) announced today its financial results for the first quarter ended March 31, 2021.

The Company reported net income of $2,046,000 for the three months ended March 31, 2021 compared to net income of $47,000 for the same period last year. Diluted earnings per share were $1.38 for the three months ended March 31, 2021 compared to $0.03 for the same period last year.

The return on average assets for the three months ended March 31, 2021 was 1.56% and the return on average equity was 26.41%. The tax-equivalent net interest margin was 3.43% for the three months ended March 31, 2021 compared to 4.09% for the same period last year and the efficiency ratio declined to 35.61% for the three months ended March 31, 2021 compared to 58.65% for the same period last year.

President and CEO, Jeff Finck stated, "We had a solid performance in the first quarter. Our team continued to help both new and existing customers through the Paycheck Protection Program (PPP) application and forgiveness process."

Net Interest Income

Net interest income increased to $4,217,000 for the quarter ended March 31, 2021 compared to $2,842,000 for the same quarter last year. First quarter 2021 net interest income was driven by accelerated PPP fee recognition from borrower forgiveness processing.

Provision for credit losses

Provision for credit losses were $400,000 for the quarter ended March 31, 2021 compared to $1,450,000 for the same quarter last year.

Non-Interest Income

Non-interest income for the quarter ended March 31, 2021 was $877,000 compared to $394,000 for the quarter ended March 31, 2020.

Non-Interest Expense

Non-interest expense was $1,814,000 for the quarter ended March 31, 2021 compared to $1,898,000 for the same period last year.

Balance Sheet

Total loans, net of unearned income at March 31, 2021 were $382.3 million compared to $250.4 million at March 31, 2020.

Total deposits were $485.3 million at March 31, 2021 compared to total deposits of $268.0 million at March 31, 2020.

Credit Quality

The allowance for loan losses was $4,409,000, or 1.15% of loans, net of unearned income at March 31, 2021, compared to $3,859,000, or 1.54% of loans, net of unearned income at March 31, 2020. There were no nonperforming assets at March 31, 2021 and March 31, 2020.

Capital

At March 31, 2021, shareholders’ equity totaled $31.4 million compared to $26.1 million at March 31, 2020. Book value was $21.65 per share at March 31, 2021 compared to $17.63 per share at March 31, 2020.

During the fourth quarter of 2021, the Company repurchased 500 shares of its common stock for a total of $9,500.

About Cornerstone Community Bancorp

Cornerstone Community Bancorp, a bank holding company headquartered in Red Bluff, California, serves the Red Bluff and Redding communities through its wholly-owned subsidiary, Cornerstone Community Bank with a headquarters office in Red Bluff and two banking offices in Redding. The Bank provides commercial banking services to small and mid-size businesses, including professional service firms, real estate developers and investors and not-for-profit organizations and to their owners and other individuals. Additional information about the Bank is available on its website at www.bankcornerstone.com

Forward-Looking Statements

This release may contain certain forward-looking statements that are based on management's current expectations regarding economic, legislative, and regulatory issues that may impact Cornerstone Community Bancorp's earnings in future periods. 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," "intend," "estimate" or words of similar meaning, or future or conditional verbs such as "will," "would," "should," "could" or "may." Factors that could cause future results to vary materially from current management expectations include, but are not limited to, natural disasters (such as wildfires and earthquakes), pandemics such as COVID-19 and the economic impact caused directly by the disease and by government responses thereto, general economic conditions, economic uncertainty in the United States and abroad, changes in interest rates, deposit flows, real estate values, costs or effects of acquisitions, competition, changes in accounting principles, policies or guidelines, legislation or regulation (including the Tax Cuts & Jobs Act of 2017 and the Coronavirus Aid, Relief and Economic Security Act of 2021), interruptions of utility service in our markets for sustained periods, and other economic, competitive, governmental, regulatory and technological factors (including external fraud and cybersecurity threats) affecting Cornerstone Community Bancorp's operations, pricing, products and services. Forward-looking statements speak only as of the date they are made. Except as required by law, Cornerstone Community Bancorp does not undertake to update forward-looking statements to reflect subsequent circumstances or events.

CORNERSTONE COMMUNITY BANCORP

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(Dollars in Thousands)

03/31/21

12/31/20

09/30/20

06/30/20

03/31/20

ASSETS

Cash and due from banks

$

5,417

$

3,811

$

5,455

$

6,350

$

4,965

Federal funds sold

5,761

14,166

5,045

10,402

17,385

Interest-bearing deposits

68,283

77,045

62,110

73,310

18,928

Investment securities

52,084

50,336

50,699

16,173

13,144

Loans held for sale

1,102

-

-

-

-

Loans, net of unearned income

382,253

332,176

342,416

333,620

250,353

Allowance for loan losses

(4,409

)

(4,009

)

(4,009

)

(4,009

)

(3,859

)

Loans, net

377,844

328,167

338,407

329,611

246,494

Premises and equipment, net

12,767

11,581

10,992

11,095

11,180

Other assets

13,974

12,724

12,577

11,882

11,330

Total assets

$

537,232

$

497,830

$

485,285

$

458,823

$

323,426

LIABILITIES

Deposits:

Demand noninterest-bearing

$

126,481

$

108,147

$

103,824

$

96,395

$

58,357

Demand interest-bearing

122,506

108,097

104,819

90,633

51,608

Money market and savings

163,232

146,655

87,035

79,550

77,273

Time deposits of less than $100,000

15,812

15,418

21,103

22,925

26,503

Time deposits of $100,000 or more

57,299

55,021

54,695

51,919

54,274

Total deposits

485,330

433,338

371,476

341,422

268,015

Borrowings and other obligations

5,000

15,000

78,136

83,136

23,000

Subordinated debentures

11,703

16,645

4,923

4,920

4,917

Interest payable and other liabilities

3,776

2,763

1,854

1,765

1,382

Total liabilities

505,809

467,746

456,389

431,243

297,314

SHAREHOLDERS' EQUITY

Common stock

14,681

14,584

15,462

15,440

15,336

Retained Earnings

17,183

15,136

13,077

11,841

10,557

Accumulated other comprehensive income (loss)

(441

)

364

357

299

219

Total shareholders' equity

31,423

30,084

28,896

27,580

26,112

Total liabilities and shareholders' equity

$

537,232

$

497,830

$

485,285

$

458,823

$

323,426

Total equity / total assets

5.85

%

6.04

%

5.95

%

6.01

%

8.07

%

Book value per share

$

21.65

$

20.87

$

19.38

$

18.50

$

17.63

Shares outstanding

1,451,091

1,441,241

1,491,041

1,491,041

1,481,041

CORNERSTONE COMMUNITY BANCORP

CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

(Dollars in Thousands)

Three months ended

03/31/21

12/31/20

03/31/20

INTEREST INCOME

Loans

$

4,451

$

4,761

$

3,356

Federal funds sold

2

2

17

Investment securities

162

162

90

Other

32

51

45

Total interest income

4,647

4,976

3,508

INTEREST EXPENSE

Deposits:

Interest-bearing demand

47

55

35

Money market and savings

87

80

186

Time deposits

124

155

331

Other

172

221

114

Total interest expense

430

511

666

Net interest income

4,217

4,465

2,842

Provision for credit losses

400

-

1,450

Net interest income after provision

for credit losses

3,817

4,465

1,392

NON-INTEREST INCOME

Service charges on deposit accounts

58

55

72

Gain on sale of loans

700

61

186

Gain (loss) on sale of other real estate owned

-

-

-

Gain (loss) on sale of securities

(45

)

-

-

Other non-interest income

164

229

136

Total non-interest income

877

345

394

OPERATING EXPENSES

Salaries and benefits

679

970

939

Premises and fixed assets

179

182

252

Other

956

757

707

Total operating expenses

1,814

1,909

1,898

Income before income taxes

2,880

2,901

(112

)

Income taxes

834

842

(159

)

NET INCOME

$

2,046

$

2,059

$

47

EARNINGS PER SHARE

Basic earnings per share

$

1.41

$

1.39

$

0.03

Diluted earnings per share

$

1.38

$

1.36

$

0.03

Average common shares outstanding

1,447,763

1,477,361

1,480,668

Average common and equivalent

shares outstanding

1,485,953

1,511,365

1,532,685

PERFORMANCE MEASURES

Return on average assets

1.56

%

1.68

%

0.06

%

Return on average equity

26.41

%

27.70

%

0.71

%

Tax-equivalent net interest margin

3.43

%

3.81

%

4.09

%

Efficiency ratio

35.61

%

39.69

%

58.65

%

View source version on businesswire.com: https://www.businesswire.com/news/home/20210413005997/en/

Contacts

Jeffrey P. Finck
President & CEO
530.222.1460

Patrick E. Phelan
Chief Financial Officer
530.222.1460