Cornerstone Community Bancorp Reports Financial Results For the Third Quarter Ended September 30, 2022
10/20/2022 - 04:03 PM
RED BLUFF, Calif. --(BUSINESS WIRE)--
Cornerstone Community Bancorp (OTC Pink: CRSB ) announced today its financial results for the third quarter ended September 30, 2022 .
The Company reported net income of $1,936,000 for the three months ended September 30, 2022 compared to net income of $2,085,000 for the same period last year. Diluted earnings per share were $1.27 for the three months ended September 30, 2022 compared to $1.38 for the same period last year.
The return on average assets for the three months ended September 30, 2022 was 1.30% and the return on average equity was 23.11% . The tax-equivalent net interest margin was 3.60% for the three months ended September 30, 2022 compared to 3.66% for the same period last year and the efficiency ratio was 49.42% for the three months ended September 30, 2022 compared to 38.37% for the same period last year.
For the nine months ended September 30, 2022 , the Company reported net income of $5,317,000 compared to net income of $5,948,000 for the same period last year. Diluted earnings per share were $3.48 for the nine months ended September 30, 2022 compared to $3.96 for the same period last year.
The return on average assets for the nine months ended September 30, 2022 was 1.21% and the return on average equity was 20.48% .
President and CEO, Matt Moseley stated, “We continue to produce strong returns on assets and equity. Credit quality remains strong with no nonperforming assets. Operating expenses have increased as the bank continues to hire and build its infrastructure for future growth.”
Net Interest Income
Net interest income increased to $5,196,000 for the quarter ended September 30, 2022 compared to $4,756,000 for the same quarter last year. For the nine months ended September 30, 2022 , net interest income increased to $14,151,000 compared to $13,212,000 for the same period last year.
Provision for credit losses
Provision for credit losses were $40,000 for the quarter ended September 30, 2022 compared to $400,000 for the same quarter last year. For the nine months ended September 30, 2022 , the Company recorded a $113,000 provision for credit losses compared to $900,000 for the same period last year.
Non-Interest Income
Non-interest income for the quarter ended September 30, 2022 was $265,000 compared to $652,000 for the quarter ended September 30, 2021 . For the nine months ended September 30, 2022 , non-interest income was $795,000 compared to $2,013,000 for the same period last year.
Non-Interest Expense
Non-interest expense was $2,699,000 for the quarter ended September 30, 2022 compared to $2,075,000 for the same period last year. For the nine months ended September 30, 2022 , non-interest expense was $7,368,000 compared to $5,965,000 for the same period last year.
Balance Sheet
Total loans, net of unearned income, at September 30, 2022 were $400.5 million $388.5 million September 30, 2021 .
Total deposits were $545.3 million September 30, 2022 compared to total deposits of $500.1 million September 30, 2021 .
Credit Quality
The allowance for loan losses was $5,172,000 , or 1.29% of loans, net of unearned income, at September 30, 2022 , compared to $4,909,000 , or 1.26% of loans, net of unearned income, at September 30, 2021 . There were no nonperforming assets at September 30, 2022 and September 30, 2021 .
Capital
At September 30, 2022 , shareholders’ equity totaled $30.6 million $35.5 million September 30, 2021 . At September 30, 2022 , the Company's book value per common share was $20.81 compared to $24.37 at September 30, 2021 . During the nine months ended September 30, 2022 , increasing interest rates resulted in a decline in the fair value of available for sale investment securities. This impact is reflected in the decline in accumulated other comprehensive income (AOCI) to $(12,763,000) at September 30, 2022 , compared to $(378,000) at September 30, 2021 . Excluding AOCI, book value increased to $29.50 at September 30, 2022 , compared to $24.63 at September 30, 2021 .
AOCI has no effect on Cornerstone Community Bank’s (the Bank) regulatory capital ratios as the Bank opted to exclude it from regulatory capital calculations. At September 30, 2022 , the Bank’s total risk-based capital ratio was 13.39% and its tier 1 capital to risk weighted assets ratio was 12.18% . The Bank remains well capitalized under the regulatory framework for prompt corrective action.
About Cornerstone Community Bancorp
Cornerstone Community Bancorp , a bank holding company headquartered in Red Bluff, California , serves the Red Bluff , Redding and Anderson communities through its wholly-owned subsidiary, Cornerstone Community Bank with a headquarters office in Red Bluff , two banking offices in Redding and one in Anderson . 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 Coronavirus Aid, Relief and Economic Security Act of 2022), 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)
09/30/22 06/30/22 03/31/22 12/31/21 09/30/21
ASSETS
Cash and due from banks
$
6,011
$
5,230
$
4,175
$
4,552
$
4,765
Federal funds sold
122
121
121
121
2,600
Interest-bearing deposits
57,618
48,277
73,629
77,933
24,636
Investment securities
95,511
102,692
99,748
108,253
110,470
Loans held for sale
-
-
-
-
-
Loans, net of unearned income
400,480
399,156
375,369
387,374
388,532
Allowance for loan losses
(5,172
)
(5,132
)
(5,077
)
(5,059
)
(4,909
)
Loans, net
395,308
394,024
370,292
382,315
383,623
Premises and equipment, net
14,671
14,691
14,757
14,784
13,567
Other assets
21,261
20,588
16,930
15,622
14,863
Total assets
$
590,502
$
585,623
$
579,652
$
603,580
$
554,524
LIABILITIES
Deposits:
Demand noninterest-bearing
$
129,236
$
130,249
$
131,136
$
174,282
$
141,734
Demand interest-bearing
138,630
131,623
126,331
131,368
131,964
Money market and savings
201,316
201,106
196,653
163,946
150,149
Time deposits
76,121
76,576
78,167
78,111
76,291
Total deposits
545,303
539,554
532,287
547,707
500,138
Borrowings and other obligations
-
-
-
5,000
5,000
Subordinated debentures
11,738
11,732
11,726
11,720
11,715
Interest payable and other liabilities
2,892
2,631
1,899
2,134
2,151
Total liabilities
559,933
553,917
545,912
566,561
519,004
SHAREHOLDERS' EQUITY
Common stock
14,964
15,079
15,009
14,913
14,814
Retained Earnings
28,368
26,432
24,726
23,051
21,084
Accumulated other comprehensive income (loss)
(12,763
)
(9,805
)
(5,995
)
(945
)
(378
)
Total shareholders' equity
30,569
31,706
33,740
37,019
35,520
Total liabilities and shareholders' equity
$
590,502
$
585,623
$
579,652
$
603,580
$
554,524
Total equity / total assets
5.18
%
5.41
%
5.82
%
6.13
%
6.41
%
Book value per share
$
20.81
$
21.51
$
22.93
$
25.31
$
24.37
Shares outstanding
1,469,091
1,474,091
1,471,591
1,462,591
1,457,591
CORNERSTONE COMMUNITY BANCORP
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(Dollars in Thousands)
Three months ended Nine months ended
09/30/22 06/30/22 09/30/21 09/30/22 09/30/21
INTEREST INCOME
Loans
$
5,018
$
4,485
$
4,772
$
13,851
$
13,602
Federal funds sold
1
-
-
1
3
Investment securities
543
464
360
1,378
739
Other
354
146
35
558
120
Total interest income
5,916
5,095
5,167
15,788
14,464
INTEREST EXPENSE
Deposits:
Interest-bearing demand
130
64
46
240
138
Money market and savings
260
147
96
524
276
Time deposits
182
131
107
420
345
Other
148
148
162
453
493
Total interest expense
720
490
411
1,637
1,252
Net interest income
5,196
4,605
4,756
14,151
13,212
Provision for credit losses
40
55
400
113
900
Net interest income after provision for credit losses
5,156
4,550
4,356
14,038
12,312
NON-INTEREST INCOME
Service charges on deposit accounts
67
62
62
200
179
Gain on sale of loans
-
-
396
-
1,231
Gain (loss) on sale of other real estate owned
-
-
-
-
-
Gain (loss) on sale of securities
-
-
-
-
(45
)
Other non-interest income
198
204
194
595
648
Total non-interest income
265
266
652
795
2,013
OPERATING EXPENSES
Salaries and benefits
1,408
1,219
1,048
3,773
2,695
Premises and fixed assets
227
194
150
612
590
Other
1,064
1,013
877
2,983
2,680
Total operating expenses
2,699
2,426
2,075
7,368
5,965
Income before income taxes
2,722
2,390
2,933
7,465
8,360
Income taxes
786
684
848
2,148
2,412
NET INCOME
$
1,936
$
1,706
$
2,085
$
5,317
$
5,948
EARNINGS PER SHARE
Basic earnings per share
$
1.31
$
1.16
$
1.43
$
3.61
$
4.09
Diluted earnings per share
$
1.27
$
1.12
$
1.38
$
3.48
$
3.96
Average common shares outstanding
1,473,276
1,472,168
1,456,531
1,471,582
1,452,768
Average common and equivalent shares outstanding
1,523,830
1,529,540
1,512,738
1,528,628
1,503,150
PERFORMANCE MEASURES
Return on average assets
1.30
%
1.18
%
1.53
%
1.21
%
1.48
%
Return on average equity
23.11
%
20.33
%
23.52
%
20.48
%
23.98
%
Tax-equivalent net interest margin
3.60
%
3.32
%
3.66
%
3.37
%
3.48
%
Efficiency ratio
49.42
%
49.80
%
38.37
%
49.30
%
39.18
%
View source version on businesswire.com : https://www.businesswire.com/news/home/20221020006036/en/
Matthew B. Moseley
Patrick E. Phelan
Source: Cornerstone Community Bancorp
