1st Capital Bancorp Announces First Quarter 2021 Results
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1st Capital Bancorp Announces First Quarter 2021 Results

Friday, April 30, 2021 4:00 PM
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SALINAS, CA / ACCESSWIRE / April 30, 2021 / 1st Capital Bancorp (the "Company), (OTC Pink:FISB), the $875 million asset bank holding company and parent company of 1st Capital Bank (the "Bank"), today reported net income of $1.54 million or $0.27 diluted earnings per share for the quarter ended March 31, 2021. This compares to $608 thousand, or $0.11 diluted earnings per share for the quarter ended March 31, 2020, and $1.59 million, or $0.28 for the quarter ended December 31, 2020.

Financial Highlights

Performance highlights for the quarter ended March 31, 2021, as compared to quarter ending March 31, 2020, and the quarter ending December 31, 2020:

For the quarter ended March 31, 2021, the Company's return on average equity was 8.29%, as compared to 3.53% and 8.60% for the quarter ended March 31, 2020 and December 31, 2020, respectively.

For the quarter ended March 31, 2021, the Company's return on average assets was 0.77%, as compared to 0.38% and 0.82% for the quarter ended March 31, 2020 and December 31, 2020, respectively.

For the quarter ended March 31, 2021, the Company's net interest margin was 3.55%, as compared to 3.87% and 3.54% for the three months ended March 31, 2020 and December 31, 2020, respectively.

For the quarter ended March 31, 2021, the Company's efficiency ratio was 69.69%, as compared to 73.06% and 67.65% for the three months ended March 31, 2020 and December 31, 2020, respectively.

For the quarter ended March 31, 2021, the Company's provision expense for loan losses was $0, as compared to $825 thousand and $0 for the three months ended March 31, 2020 and December 31, 2020, respectively.

Financial Highlights (Con't)

For the quarter ended March 31, 2021, the Company's nonperforming assets to total assets was 0.35%, as compared to 0.08% and 0.16% for the three months ended March 31, 2020 and December 31, 2020, respectively.

As of March 31, 2021, the Company reported total assets, total deposits, and total loans of $874.4 million, $787.8 million, and $619.4 million, respectively.

"Despite the lingering challenges posed by COVID-19, our first quarter financial results are solid and reflect the continuing efforts of our dedicated team of bankers in serving our customers throughout our Central Coast communities," stated Sam Jimenez Chief Executive Officer. "Our credit quality and capital levels remain strong, positioning us well for continued growth as California and our local economies recover from the effects of the pandemic."

1ST CAPITAL BANCORP
CONDENSED FINANCIAL DATA - UNAUDITED
000s, except per share data)

               
 

For the Three Months Ended

 

March 31,

Change

 

Dec 31,

Change

 
 

2021

2020

Amount

%

2020

Amount

%

Operating Results Data

             

Interest income

$7,108

$6,188

$920

15%

$6,852

$256

4%

Interest expense

242

323

(81)

-25%

226

16

7%

Net interest income

6,866

5,865

1,001

17%

6,626

240

4%

Provision for loan losses

-

825

(825)

-100%

-

-

-

Noninterest income

191

288

(97)

-34%

233

(42)

-18%

               

Noninterest expenses

4,918

4,495

423

9%

4,640

278

6%

Income before provision for income taxes

2,139

833

1,306

157%

2,219

(80)

-4%

Provision for income taxes

602

225

377

168%

626

(24)

-4%

Net income

$1,537

$608

$929

153%

$1,593

$(56)

-4%

Assets

             

Cash and due from banks

$11,497

$6,582

$4,915

75%

$9,304

$2,193

24%

Funds held at the Federal Reserve Bank

47,158

30,071

17,087

57%

97,462

(50,304)

-52%

Available-for-sale securities, at fair value

181,201

63,728

117,473

184%

106,214

74,987

71%

               

Total loans

619,436

530,487

88,949

17%

605,154

14,282

2%

Allowance for loan losses

(8,828)

(7,431)

(1,397)

19%

(8,816)

(12)

0%

Net loans

610,608

523,056

87,552

17%

596,338

14,270

2%

Other Assets

24,003

22,323

1,680

8%

23,233

770

3%

Total assets

$874,467

$645,760

$228,707

35%

$832,551

$41,916

5%

               

Liabilities and Shareholders' Equity

             

Noninterest bearing demand deposits

$401,123

$252,760

$148,363

59%

$386,711

$14,412

4%

Interest bearing checking accounts

58,612

41,857

16,755

40%

65,686

(7,074)

-11%

Money market

185,841

158,178

27,663

17%

159,509

26,332

17%

Savings

127,940

99,789

28,151

28%

121,148

6,792

6%

Time

14,317

19,400

(5,083)

-26%

15,284

(967)

-6%

Interest bearing deposits

386,710

319,224

67,486

21%

361,627

25,083

7%

Total deposits

787,833

571,984

215,849

38%

748,338

39,495

5%

Other liabilities

12,249

4,961

7,288

147%

9,880

2,369

24%

Shareholders' equity

74,385

68,815

5,570

8%

74,333

52

0%

Total liabilities and shareholders' equity

$874,467

$645,760

$228,707

35%

$832,551

$41,916

5%

               

Shares outstanding

5,571,545

5,528,218

43,327

1%

5,570,021

1,524

0%

Earnings per share basic

$0.28

$0.11

$0.17

155%

$0.29

$-0.01

-4%

Earnings per share diluted

$0.27

$0.11

$0.16

145%

$0.28

$-0.01

-4%

Nominal and tangible book value per share

$13.35

$12.45

$0.90

7%

$13.35

$0.00

0%

FIRST QUARTER 2021 EARNINGS SUMMARY

Net Interest Income and Net Interest Margin

The Company's first quarter 2021 net interest income increased $1.0 million or 17.07% as compared with the quarter ending March 31, 2020 and $240 thousand or 3.62%, compared with the quarter ending December 31, 2020. The increase from the same period a year ago was driven almost exclusively from revenue generation from the Paycheck Protection Program (PPP) loans while the increase over the trailing quarter was primarily driven from an increased level of investment securities.

The Company's net interest margin decreased by 32 basis points (bps) or 8.27% when compared to the quarter ending March 31, 2020, and was generally flat relative to the quarter ending December 31, 2020.

The 32 bps decrease compared to the same period a year ago was driven by a significant amount of the Company's earning assets re-pricing lower as a result of 150 bps reduction of the Federal Funds rate in March of 2020. The net interest margin remained flat relative to the trailing quarter due to a combination of exchanging incoming cash flows from prepaying residential mortgage loans and deposit growth for newly generated PPP loan originations and securities purchases.

Provision for Loan Losses

The Company did not make any provisions for loan losses in the quarter ending March 31, 2021, as compared to $825 thousand and $0 in the quarter ending March 31, 2020, and December 31, 2020, respectively. Uncertainty surrounding COVID-19, and the potential negative impact on our clients and asset quality dictated the provisions made in the same period a year ago. Improving economic conditions and diminished concern with the Company's asset quality eliminated the need for any additional provisions for loan losses in the trailing quarter of December 31, 2020.

Noninterest Expenses

The Company's first quarter 2021 non-interest expenses increased $423 thousand and $278 thousand or 9.41% and 5.99%, as compared with quarter ending March 31, 2020, and December 31, 2020, respectively.

The increases in both comparative periods is centered in salaries and benefits. In regards to the same period ending March 31, 2020, the addition of 11 employees, including a team of Relationship Managers in our San Luis Obispo market, the opening of our Santa Cruz branch, merit increases for all employees, and to a lesser extent, increases in various other general operating areas also contributed to the increased level of expenses.

The increase as compared to the trailing period of December 31, 2020 is primarily attributed to the transition expense of an executive officer.

Balance Sheet Summary

The Company's total assets increased $228.7 million or 35.42% to $874.4 million as compared to the quarter ending March 31, 2020.

Total loans outstanding totaled $619.4 million as of March 31, 2021. This represents an $88.9 million increase or 16.77% from the quarter ending March 31, 2020 outstanding balance of $530.5 million. The Company's loan growth was driven by $118.4 million in PPP loan originations, $18.8 million in organic loan growth, and partially offset by $48.3 in payoffs from our residential mortgage portfolio.

The investment portfolio increased $117.5 million or 184.34% to $181.2 million from an outstanding balance of $63.7 million as of March 31, 2020. As mentioned above, incoming cashflows from prepaying assets and deposit growth were also significantly deployed in bonds. The majority of the investments were made in mortgage-backed securities, floating rate securities, and to a lesser extent in municipal securities.

Total deposits totaled $787.8 million as of March 31, 2021. This represents a $215.8 million increase or 37.74% from the quarter ending March 31, 2020 outstanding balance of $572.0 million. Growth in noninterest-bearing demand deposit accounts accounted $148.4 million or 68.77% of the total deposit growth over the twelve months ending on March 31, 2021. The majority of this growth was associated with PPP loan proceeds which our customers deposited with the Bank.

The balance of the deposit growth was distributed among interest-bearing deposit accounts with the exception of time deposits which decreased by approximately $5.1 million to $14.3 million

Asset Quality

At March 31, 2021, non-performing assets were 0.35% of the Company's total assets, compared with 0.08% at March 31, 2020. At March 31, 2021, the allowance for loan losses was 1.43% of outstanding loans, compared to 1.40% at March 31, 2020, respectively. The Bank recorded net recoveries of $12 thousand in each of the first quarters of 2021 and 2020.

As of March 31, 2021, the Company does not have any outstanding loan deferments or forbearances stemming from COVID-19.

1ST CAPITAL BANCORP
CONDENSED FINANCIAL DATA - UNAUDITED
($ in 000s, except per share data)

Assets
  3/31/2021     12/31/2020     9/30/2020     3/31/2020  
Cash and due from banks
  $ 11,497     $ 9,304     $ 6,966     $ 6,582  
Funds held at the Federal Reserve Bank
    47,158       97,462       38,715       30,071  
Available-for-sale securities, at fair value
    181,201       106,214       59,649       63,728  
Loans held for sale
    -       -       442       -  
Construction/land (including farmland)
    19,331       17,097       15,850       21,193  
Residential 1 to 4 units
    87,736       102,688       115,881       136,014  
Home equity lines of credit
    5,400       5,955       6,034       7,656  
Multifamily
    84,942       84,704       79,693       57,900  
Owner occupied commercial real estate
    68,189       72,427       70,935       73,488  
Investor commercial real estate
    176,709       174,437       173,557       171,266  
Commercial and industrial
    49,314       47,550       48,812       50,460  
Paycheck Protection Program
    118,381       90,382       106,559       -  
Other loans
    9,434       9,914       10,877       12,510  
Total loans held for investment
    619,436       605,154       628,198       530,487  
Allowance for loan losses
    (8,828 )     (8,816 )     (8,804 )     (7,431 )
Net loans held for investment
    610,608       596,338       619,394       523,056  
Other assets
    24,003       23,233       23,856       22,323  
Total assets
  $ 874,467     $ 832,551     $ 749,022     $ 645,760  
 
                               
Liabilities and Shareholders' Equity
  3/31/2021     12/31/2020     9/30/2020     3/31/2020  
Noninterest bearing demand deposits
  $ 401,123     $ 386,711     $ 356,730     $ 252,760  
Interest bearing checking accounts
    58,612       65,686       54,228       41,857  
Money market
    185,841       159,509       128,039       158,178  
Savings
    127,940       121,148       105,431       99,789  
Time
    14,317       15,284       17,147       19,400  
Interest bearing deposits
    386,710       361,627       304,845       319,224  
Total deposits
    787,833       748,338       661,575       571,984  
Other liabilities
    12,249       9,880       15,059       4,961  
Shareholders' equity
    74,385       74,333       72,388       68,815  
Total liabilities and shareholders' equity
  $ 874,467     $ 832,551     $ 749,022     $ 645,760  

CONDENSED FINANCIAL DATA
(Unaudited)
(Dollars in thousands)

 
  Three Months Ended  
Operating Results Data
  3/31/2021     12/31/2020     9/30/2020     3/31/2020  
Loans
  $ 6,600     $ 6,531     $ 6,133     $ 5,683  
Investment securities
    455       266       253       375  
Federal Home Loan Bank stock
    44       44       44       62  
Other income
    9       11       7       68  
Interest expense
    242       226       212       323  
Net interest income
    6,866       6,626       6,225       5,865  
Provision for loan losses
    -       -       650       825  
Noninterest income
    191       233       326       288  
 
                               
Salaries and benefits expense
    3,144       2,937       2,704       2,824  
Occupancy expense
    418       408       390       363  
Data and item processing
    251       249       225       221  
Furniture and equipment
    116       131       127       191  
Professional services
    178       123       350       161  
Other
    811       792       782       735  
Total noninterest expenses
    4,918       4,640       4,578       4,495  
Income before provision for income taxes
    2,139       2,219       1,323       833  
Provision for income taxes
    602       626       370       225  
Net income
  $ 1,537     $ 1,593     $ 953     $ 608  

Asset Quality

3/31/2021

12/31/2020

9/30/2020

3/31/2020

Loans past due 90 days or more and accruing interest

$-

$-

$-

$-

Nonaccrual restructured loans

-

-

-

-

Other nonaccrual loans

3,100

1,299

1,535

492

Other real estate owned

-

-

-

-

Total nonperforming assets

$3,100

$1,299

$1,535

$492

         

Allowance for loan losses to total loans

1.43%

1.46%

1.40%

1.40%

Allowance for loan losses to nonperforming loans

284.77%

678.68%

573.55%

1510.37%

Nonaccrual loans to total loans

0.50%

0.21%

0.24%

0.09%

Nonperforming assets to total assets

0.35%

0.16%

0.20%

0.08%

 
 
  Three Months Ended  
Selected Average Balances
  3/31/2021     12/31/2020     9/30/2020     3/31/2020  
Gross loans
  $ 615,088     $ 618,458     $ 628,889     $ 519,468  
Investment securities
    124,642       75,020       61,323       65,163  
Federal Home Loan Bank stock
    3,534       3,534       3,534       3,501  
Other interest earning assets
    45,417       46,969       24,815       21,463  
Total interest earning assets
  $ 788,681     $ 743,981     $ 718,561     $ 609,595  
 
                               
Total assets
  $ 813,566     $ 769,694     $ 741,263     $ 633,623  
 
                               
Interest bearing checking accounts
  $ 59,229     $ 54,120     $ 47,246     $ 42,092  
Money market
    157,959       136,535       127,094       132,363  
Savings
    124,342       111,468       105,548       103,156  
Time deposits
    14,690       15,937       17,748       19,367  
Total interest bearing deposits
    356,220       318,060       297,636       296,978  
Noninterest bearing demand deposits
    372,019       364,571       356,738       262,416  
Total deposits
  $ 728,239     $ 682,631     $ 654,374     $ 559,394  
Borrowings
  $ 5,000     $ 8,261     $ 10,000     $ -  
Shareholders' equity
  $ 75,221     $ 73,488     $ 71,849     $ 69,006  
 
                               
 
                               
  Three Months Ended  
Selected Financial Ratios
  3/31/2021     12/31/2020     9/30/2020     3/31/2020  
Return on average total assets
    0.77 %     0.82 %     0.51 %     0.38 %
Return on average shareholders' equity
    8.29 %     8.60 %     5.26 %     3.53 %
Net interest margin
    3.55 %     3.54 %     3.45 %     3.87 %
Net interest income to average total assets
    3.42 %     3.42 %     3.33 %     3.71 %
Efficiency ratio
    69.69 %     67.65 %     69.88 %     73.06 %
Regulatory Capital and Ratios
  3/31/2021     12/31/2020     9/30/2020     3/31/2020  
Common equity tier 1 capital
  $ 74,132     $ 72,461     $ 70,831     $ 68,150  
Tier 1 regulatory capital
  $ 74,132     $ 72,461     $ 70,831     $ 68,150  
Total regulatory capital
  $ 80,863     $ 78,957     $ 77,117     $ 74,404  
Tier 1 leverage ratio
    9.14 %     9.44 %     9.58 %     10.77 %
Common equity tier 1 risk based capital ratio
    13.83 %     14.01 %     14.16 %     13.66 %
Tier 1 capital ratio
    13.83 %     14.01 %     14.16 %     13.66 %
Total risk based capital ratio
    15.08 %     15.27 %     15.42 %     14.91 %
 

About 1st Capital Bancorp

1st Capital Bancorp is the holding company for 1st Capital Bank. The Bank's primary target markets are commercial enterprises, professionals, real estate investors, family business entities, and residents along the Central Coast region of California. The Bank provides a wide range of credit products, including loans under various government programs such as those provided through the U.S. Small Business Administration and the U.S. Department of Agriculture. A full suite of deposit accounts also is furnished, complemented by robust cash management services. The Bank operates full service branch offices in Monterey, Salinas, King City, San Luis Obispo and Santa Cruz. The Bank's corporate offices are located at 150 Main Street, Suite 150, Salinas, California 93901. The Bank's website is www.1stCapital.bank. The main telephone number is 831.264.4000.

Member FDIC / Equal Opportunity Lender / SBA Preferred Lender

Forward-Looking Statements

Certain of the statements contained herein that are not historical facts are "forward-looking statements" within the meaning of and subject to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements may contain words or phrases including, but not limited, to: "believe," "expect," "anticipate," "intend," "estimate," "target," "plans," "may increase," "may fluctuate," "may result in," "are projected," and variations of those words and similar expressions. All such forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Factors that might cause such a difference include, among other matters, changes in interest rates; economic conditions including inflation and real estate values in California and the Bank's market areas; governmental regulation and legislation; credit quality; competition affecting the Bank's businesses generally; the risk of natural disasters and future catastrophic events including pandemics, terrorist related incidents and other factors beyond the Bank's control; and other factors. The Bank does not undertake, and specifically disclaims any obligation, to update or revise any forward-looking statements, whether to reflect new information, future events, or otherwise, except as required by law.

This news release is available at the www.1stCapital.bank internet site for no charge.

For further information, please contact:

Samuel D. Jimenez

or

Tamara S. Allen

Chief Executive Officer

 

Interim Chief Financial Officer

831.264.4057 office

 

831.264.4014 office

[email protected]

 

[email protected]

     
SOURCE: 1st Capital Bank
1st Capital Bank
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