RBAZ Bancorp, Inc. Announces Unaudited Financial Results for the Quarter Ending June 30, 2023
RBAZ Bancorp, Inc. (OTCIQ: RBAZ) reports a 31.5% increase in net earnings for the quarter ended June 30, 2023, driven by significant loan production. Total loans and deposits also saw substantial growth. Despite challenges from higher cost of funds due to Federal Reserve rate increases, RBAZ remains well-capitalized and poised for continued growth.
Positive
Consolidated net income increased by 31.5% year-over-year, reaching $1,023,000 for the six months ended June 30, 2023. The company attributes this growth to significant loan production, leading to an 8.6% increase in total loans and an 18.1% increase in total deposits. Total interest income also grew by 53.5% to $3,393,000 for the quarter ended June 30, 2023.
07/27/2023 - 04:06 PM
31.5% Increase in Earnings YoY
PHOENIX, July 27, 2023 (GLOBE NEWSWIRE) -- RBAZ Bancorp, Inc. (OTCIQ: RBAZ) (the “Company”), parent company of Republic Bank of Arizona (the “Bank” or “RBAZ”), announced a consolidated net income of $561,000 , or $0.31 per share, for the quarter ended June 30, 2023 and $1,023,000 , or $0.57 per share, for the six months ended June 30, 2023 as compared to a consolidated net income of $405,000 , or $0.22 per share, for the quarter ended June 30, 2022 and $778,000 , or $0.43 per share, for the six months ended June 30, 2022. Current year earnings of $0.57 per share were attributable entirely to core operations. Prior year earnings of $0.43 per share were comprised of $0.34 per share attributable to core operations and $0.09 per share due to impacts from the Paycheck Protection Program.
President and CEO Brian Ruisinger stated, “We are pleased to report a 31.5% year-to-date increase in net earnings over the same period last year primarily driven by our significant loan production. Our growth was recognized by the ICBA in its Top Lenders of 2023 publication, in which RBAZ ranked in the Top 10 for commercial lending for institutions with less than $300 million in assets. This growth was accomplished while maintaining asset quality at a high level evidenced by no past due loans and non-performing loans significantly less than peer at quarter-end.”
Mr. Ruisinger continued, “After a tumultuous Q1 in the banking industry, we experienced a calming in Q2. However, the Federal Reserve continued increasing rates causing higher cost of funds resulting in added pressure on liquidity and margins. While RBAZ is not immune to these challenges, we have been able to capitalize on opportunities presented by the robust economy in the Phoenix area. RBAZ remains well capitalized and poised for continued growth in its mission to be the premier Arizona-based community bank, as reflected in our Bauer Five-Star bank rating.”
June 30, 2023 Company Highlights Include:
Total loans of $176,986,000 increased $14,032,000 , or 8.6% , from December 31, 2022 as the Company experienced significant, diversified loan growth in the first half of the year. Total deposits of $240,169,000 increased $36,837,000 , or 18.1% , from December 31, 2022 as the Company supplemented short-term deposits gathered in the first quarter with core deposit generation in the second quarter through deepening of existing relationships and cultivation of new banking relationships. Management prioritized liquidity in its 2023 Strategic Plan and deployed additional resources into deposit production. Total interest income increased $1,182,000 t o $3,393,000 for the quarter ended June 30, 2023 outpacing total interest income of $2,211,000 for the same period of the prior year equating to an increase of 53.5% . Cost of deposits increased to 1.75% for the quarter ended June 30, 2023 from 0.32% for the quarter ended June 30, 2022 as the result of upward rate pressure as the Federal Reserve increased interest rates by 3.50% since the second quarter of 2022. Total non-interest expense increased $479,000 t o $1,765,000 for the quarter ended June 30, 2023 compared to $1,286,000 for the same period of the prior year resulting primarily from several additional full-time employees, the addition of the Gilbert branch, and investments made in technology and marketing in support of the Company’s growth. The Bank remains “Well Capitalized” under the Community Bank Leverage Ratio (CBLR) framework as follows:
June 30, 2023 Ratio to be Well Capitalized (%) CBLR ratio 10.39 9.00
About the Company
About the Bank
Republic Bank of Arizona is a locally owned, community bank in Phoenix, Scottsdale and Gilbert, Arizona. RBAZ is a full service, community bank providing deposit and loan products and convenient, online and mobile banking to individuals, businesses and professionals. The Bank was established in April 2007 and is headquartered at 645 E. Missouri Avenue, Suite 108, Phoenix, AZ. Our second location is at 6909 E. Greenway Parkway, Suite 150, Scottsdale, AZ. Our third location opened in October 2022 at 1417 W. Elliot Road, Gilbert, AZ. The Bank is the wholly-owned subsidiary of RBAZ Bancorp, Inc. For further information, please visit our web site: www.republicbankaz.com .
Forward-looking Statements
This press release may include forward-looking statements about the Company and the Bank (collectively referred to herein as the “Company”), for which the Company claims the protection of safe harbor provisions contained in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on management’s knowledge and belief as of today and include information concerning the Company’s possible or assumed future financial condition, and its results of operations and business. Forward-looking statements are subject to risks and uncertainties. A number of important factors could cause actual results to differ materially from those in the forward-looking statements. Those factors include fluctuations in interest rates, government policies and regulations (including monetary and fiscal policies), legislation, economic conditions, borrower capacity to repay, operational factors and competition in the geographic and business areas in which the Company conducts its operations. All forward-looking statements included in this press release are based on information available at the time of the release, and the Company assumes no obligation to update any forward-looking statement.
Summary Company Financial Information (unaudited) For the three months ended June 30, For the six months ended June 30, Year-End 2023 2022 2023 2022 2022 (dollars in thousands, except per share data) Summary Income Data: Interest income $3,393 $2,211 $6,434 $4,145 $9,218 Interest expense 1,096 267 2,037 515 1,674 Net interest income 2,297 1,944 4,397 3,630 7,544 Provision for credit losses - 105 - 105 218 Non-interest income 194 28 405 35 511 Non-interest expense 1,765 1,286 3,449 2,476 5,386 Income before income taxes 726 581 1,353 1,084 2,451 Provision for income tax 165 176 330 306 538 Net income $561 $405 $1,023 $778 $1,913 Per Share Data: Shares outstanding end-of-period 1,808 1,797 1,808 1,797 1,797 Earnings per common share $0.31 $0.22 $0.57 $0.43 $1.06 Diluted earnings per common share $0.30 $0.21 $0.55 $0.41 $1.02 Book value per share $10.57 $9.78 $10.57 $9.78 $10.11 Selected Balance Sheet Data: Total assets $266,716 $249,658 $266,716 $249,658 $237,620 Securities available-for-sale, at fair value 39,880 42,608 39,880 42,608 43,441 Securities held-to-maturity 11,326 12,342 11,326 12,342 12,176 Loans 176,986 135,293 176,986 135,293 162,954 Allowance for credit losses 2,116 1,602 2,116 1,602 1,764 Deposits 240,169 225,084 240,169 225,084 203,332 Other borrowings 5,914 5,885 5,914 5,885 14,900 Shareholders’ equity 19,112 17,573 19,112 17,573 18,166 Performance Ratios: Return on average shareholders’ equity (annualized) (%) 11.74 9.22 10.71 8.85 10.53 Net interest margin (%) 3.61 3.13 3.58 3.07 3.21 Average assets $261,179 $256,644 $254,415 $247,843 $239,864 Return on average assets (annualized) (%) 0.86 0.63 0.80 0.63 0.80 Shareholders’ equity to assets (%) 7.17 7.04 7.17 7.04 7.64 Efficiency ratio (%) 70.86 65.21 71.82 67.56 66.87 Asset Quality Data: Nonaccrual loans $224 $- $224 $- $118 Troubled debt restructurings $88 $173 $88 $173 $156 Other real estate $- $- $- $- $- Nonperforming loans $224 $139 $224 $139 $118 Nonperforming loans to total assets (%) 0.08 0.06 0.08 0.06 0.05 Nonperforming loans to total loans (%) 0.13 0.10 0.13 0.10 0.07 Reserve for credit losses to total loans (%) 1.20 1.18 1.20 1.18 1.08 Reserve for credit losses to nonperforming loans (%) 944.64 1,152.52 944.64 1,152.52 1,494.92 Net recoveries for period $- $9 $352 $29 $78 Average loans $169,623 $130,784 $165,612 $133,956 $138,529 Ratio of net recoveries to average loans (%) n/a 0.01 0.21 0.02 0.06
bruisinger@republicaz.com
What is RBAZ Bancorp, Inc.'s net income for the quarter ended June 30, 2023?
RBAZ Bancorp, Inc. reported a consolidated net income of $561,000, or $0.31 per share, for the quarter ended June 30, 2023 and $1,023,000, or $0.57 per share, for the six months ended June 30, 2023.
What contributed to RBAZ Bancorp, Inc.'s year-over-year net earnings increase?
The company attributes the 31.5% increase in net earnings primarily to significant loan production and growth, which led to an 8.6% increase in total loans and an 18.1% increase in total deposits.
How did RBAZ Bancorp, Inc. address challenges from Federal Reserve rate increases?
Despite challenges from higher cost of funds due to Federal Reserve rate increases, RBAZ remains well-capitalized and poised for continued growth.
What are RBAZ Bancorp, Inc.'s current year earnings attributable to?
Current year earnings of $0.57 per share were attributable entirely to core operations, while prior year earnings of $0.43 per share were comprised of $0.34 per share attributable to core operations and $0.09 per share due to impacts from the Paycheck Protection Program.
