Community Bancorp (NASDAQ:CMBC)
Historical Stock Chart
From Jun 2019 to Jun 2024
Community Bancorp Inc. (NASDAQ:CMBC):
-- Net Income for the third quarter of 2005 totaled $3.4 million,
up 67% over the third quarter of 2004 and 20% over the second
quarter of 2005
-- Third Quarter Diluted EPS of $0.58 per share, up 35% over
third quarter 2004 and up 14% over second quarter 2005
Community Bancorp Inc. (the "Company") (NASDAQ:CMBC), a Southern
California based community bank holding company with $882.3 million in
total assets, today announced third quarter 2005 record net income of
$3.4 million, or $0.58 per diluted share, compared to third quarter
2004 net income of $2.0 million, or $0.43 per diluted share, and
second quarter 2005 net income of $2.8 million, or $0.51 per diluted
share. The increase in net income resulted primarily from increased
net interest income due to loan growth, acquisitions and an expanded
net interest margin.
Net income increased 49% for the nine months ended September 30,
2005 to $8.8 million compared to $5.9 million for the same period last
year. Earnings per share (EPS) increased 23% for the nine months ended
September 30, 2005 to $1.54 per diluted share compared to $1.25 per
diluted share for the same period in 2004.
The comparability of financial information is affected by our
acquisitions. Operating results include the operations of acquired
entities from the dates of acquisition. We acquired Cuyamaca Bank on
October 1, 2004 and Rancho Bernardo Community Bank on August 19, 2005.
-0-
*T
THIRD QUARTER RESULTS
(unaudited) (dollars in
thousands, Third Third Second
except per share data) Quarter Quarter Quarter
2005 2004 % Change 2005 % Change
------- ------- --------- ------- ---------
Diluted EPS $0.58 $0.43 34.88% $0.51 13.73%
Net Income $3,384 $2,030 66.70% $2,831 19.53%
Return on Average Assets
(ROA) 1.63% 1.57% 3.82% 1.54% 5.84%
Return on Average Tangible
Equity (ROTE) 22.12% 19.76% 11.94% 22.76% -2.81%
Net Interest Margin 5.81% 5.27% 10.25% 5.61% 3.57%
Efficiency Ratio 54.97% 58.59% -6.18% 57.23% -3.95%
*T
"The increase in net income resulted from several sources," stated
Michael J. Perdue, President and CEO. "We are a much larger
institution as a result of strong internal loan and deposit growth as
well as the closing of two acquisitions in the last twelve months. We
have also focused on controlling our interest expenses and improving
our deposit mix which helped to boost our net interest margin from
5.27% in the third quarter of 2004 to 5.81% in the most recent quarter
in 2005."
"We experienced continued robust internal growth during the third
quarter, which, combined with the acquisitions of Rancho Bernardo
Community Bank and Cuyamaca Bank, produced a 63% increase in total
assets to $882.3 million as of September 30, 2005 compared to $540.6
million as of September 30, 2004. If we exclude the effect of the
acquisitions, assets grew internally 19% since September 30, 2004,"
continued Perdue. "Excluding acquisitions and wholesale deposits,
retail deposits increased 24% since September 30, 2004 and gross loans
increased 24% over the same period. Including the acquisitions, total
loans increased 61% to $733.7 million as of September 30, 2005
compared to $455.2 million as of September 30, 2004. Total deposits
also increased substantially, rising 61% to $736.0 million as of
September 30, 2005 compared to the same date a year earlier. The
continued improvement in our deposit mix has also contributed to our
improved performance. Demand deposits increased significantly, rising
91% to $159.9 million as of quarter end compared to $83.7 million as
of the same date in 2004. As a result of this strengthened deposit
portfolio, the increase in market rates and the recovery of $362,000
of deferred interest on non-accrual loans, our net interest income
increased 72% for the third quarter 2005 over 2004."
Loan production was very strong, increasing 21% to $379.6 million
for the nine months ended September 30, 2005 compared to $313.0
million for the same period in 2004. Of these totals, commercial and
other loan originations were 67% of the total production, or $253.4
million, while SBA loan originations were 33% of the total production,
or $126.2 million.
INTEREST INCOME AND EXPENSE
During the three months ended September 30, 2005, net interest
income before loan loss provision increased 72% over the same period
last year. Total interest income was $14.9 million, a 90% increase
over the $7.8 million for the same period in 2004. The increase was
primarily the result of the 56% increase in average interest earning
assets and increases in the yield on those assets. Total interest
expense for the three months ended September 30, 2005 was $3.8
million, a 173% increase over the $1.4 million for the same period in
2004. Interest expense increased due to the 52% increase in average
interest bearing liabilities combined with an increase in the cost of
those liabilities as a result of increases in market interest rates.
For the third quarter 2005, average transaction accounts increased 63%
to $348.1 million compared to $213.4 million for the same period last
year.
OTHER OPERATING INCOME
Excluding the loss on REO in 2004, other operating income
decreased 8.4% to $2.5 million for the three months ended September
30, 2005 compared to $2.7 million during the same period last year due
to a decrease in the gain on sale of loans. SBA 504 loan sales totaled
$18.2 million and SBA 7a loan sales totaled $9.6 million for the third
quarter of 2005 compared to $2.6 million in SBA 504 loans and $16.1
million in SBA 7a for the same period in 2004. The change in mix of
loans sold resulted in a decrease in gain on sale revenue during the
third quarter of 2005 to $1.5 million compared to $2.0 million for the
same period in 2004. The decrease in gain on sale was partially offset
by increases in customer service charges and other fee income.
OTHER OPERATING EXPENSES
Other operating expenses increased 39% to $7.4 million for the
three months ended September 30, 2005 compared to $5.3 million for the
three months ended September 30, 2004. The increase in non-interest
expense was due to significant growth and expansion, including the
acquisitions of Cuyamaca Bank and Rancho Bernardo Community Bank, with
five combined banking offices, and the addition of a new banking
office in Murrieta, CA. As of September 30, 2005, the Company had 245
full time equivalent employees, compared to 149 as of September 30,
2004. The Company's efficiency ratio improved to 54.97% for the third
quarter of 2005 compared to 58.59% for the same period in 2004.
RESERVES AND ASSET QUALITY
As of September 30, 2005, the reserve for loan losses increased to
$10.1 million compared to $6.0 million as of September 30, 2004. The
reserve for loan losses as a percentage of total gross loans was 1.37%
as of September 30, 2005 compared to 1.32% as of September 30, 2004.
The reserve for loan losses as a percentage of total gross loans net
of government guarantees was 1.44% as of September 30, 2005 compared
to 1.43% as of September 30, 2004. During the first nine months of
2005, the Company recorded a provision for loan losses of $1.2 million
compared to $838,000 for the same period in 2004. The Company had net
loan recoveries of $186,000, or (0.04)%, for the nine months ended
September 30, 2005 compared to net loan charge offs of $19,000, or
0.01%, for the same period in 2004.
Non-performing loans were $2.7 million as of September 30, 2005
compared to $4.7 million as of September 30, 2004. Net of government
guarantees, non-performing loans as a percent of total loans were
0.17% as of September 30, 2005 compared to 0.62% as of September 30,
2004.
CAPITAL RATIOS
The Company's and Bank's capital ratios continue to be above the
well-capitalized guidelines established by bank regulatory agencies.
The Company's tangible equity to tangible assets declined to 5.81% as
of September 30, 2005 compared to 7.92% as of September 30, 2004 due
to the acquisitions of Rancho Bernardo Community Bank and Cuyamaca
Bank combined with the significant growth in assets. In order to
facilitate the acquisition of Rancho Bernardo Community Bank, the
Company issued $20.0 million in trust preferred securities, of which
$4.4 million was contributed to the Bank subsidiary as additional
capital.
RANCHO BERNARDO COMMUNITY BANK ACQUISITION
Community Bancorp acquired Rancho Bernardo Community Bank
(OTCBB:RBCB) by merging it into Community National Bank, as of the
close of business on August 19, 2005. As a result, Community began
consolidating the results of the combined entity beginning on August
20, 2005. As of the date of acquisition, Rancho Bernardo had total
assets of $125.8 million, total gross loans of $80.6 million and total
deposits of $114.2 million.
GENERAL INFORMATION
Community Bancorp is a bank holding company with $882.3 million in
assets as of September 30, 2005, with a wholly owned banking
subsidiary, Community National Bank, headquartered in Escondido,
California. The bank's primary focus is community banking, providing
commercial banking services including commercial, real estate and SBA
loans to small and medium sized businesses. The bank serves San Diego
County and southwest Riverside County with eleven community banking
offices in Bonsall, El Cajon, Encinitas, Escondido, Fallbrook, La
Mesa, Murrieta, Rancho Bernardo, Santee, Temecula and Vista, a
commercial loan production office in Corona, CA, and has additional
SBA loan production offices that originate loans in California,
Arizona, Nevada and Oregon.
FORWARD LOOKING STATEMENTS
Statements concerning future performance, developments or events,
expectations for growth and income forecasts, and any other guidance
on future periods, constitute forward-looking statements that are
subject to a number of risks and uncertainties. Actual results may
differ materially from stated expectations. Specific factors include,
but are not limited to, loan production, balance sheet management,
expanded net interest margin, the ability to control costs and
expenses, interest rate changes and financial policies of the United
States government (including the Small Business Administration), and
general economic conditions. Additional information on these and other
factors that could affect financial results are included in its
Securities and Exchange Commission filings. The Company disclaims any
obligation to update any such factors or to publicly announce the
results of any revisions to any forward-looking statements contained
herein to reflect future events or developments.
-0-
*T
CONSOLIDATED BALANCE SHEETS
--------------------------- Percentage
(unaudited) (dollars in change September December September
thousands) from 30, 31, 30,
Sep 30,
2004 2005 2004 2004
---------- --------- --------- ----------
ASSETS:
Cash and cash equivalents $21,940 $24,407 $49,332
Investments and interest
bearing deposits in
financial institutions 55,590 35,973 20,471
Loans held for investment 67% 589,896 437,932 354,000
Less allowance for loan
losses (10,124) (7,508) (6,029)
--------- --------- ----------
Net loans held for
investment 579,772 430,424 347,971
Loans held for sale 42% 143,767 101,588 101,247
Premises and equipment, net 6,976 6,737 3,951
Other real estate owned and
repossessed assets 68 - 39
Accrued interest and other
assets 15,901 13,402 8,588
Income tax receivable and
deferred tax asset, net 7,364 5,928 3,859
Servicing assets, net 4,554 4,011 3,698
Interest-only strips, at fair
value 2,196 1,749 1,454
Goodwill 44,167 17,387 -
--------- --------- ----------
Total assets 63% $882,295 $641,606 $540,610
========= ========= ==========
LIABILITIES AND STOCKHOLDERS'
EQUITY
Deposits
Interest bearing 55% $576,109 $438,995 $372,119
Non-interest bearing 91% 159,892 110,771 83,668
--------- --------- ----------
Total deposits 61% 736,001 549,766 455,787
Short term borrowing 3,000 1,000 20,000
Long term debt 38,655 17,640 14,862
Accrued expenses and other
liabilities 11,797 10,082 7,118
--------- --------- ----------
Total liabilities 59% 789,453 578,488 497,767
--------- --------- ----------
Stockholders' equity
Common stock, $0.625 par
value; authorized
10,000,000 shares,
issued and outstanding;
5,936,578 (including 11,670
of restricted stock awarded
under the equity based
compensation plan) at
September 30, 2005, 5,162,725
at December 31, 2004 and
4,422,689 at September
30, 2004 3,703 3,227 2,764
Additional paid-in capital 61,635 38,994 21,351
Deferred compensation -
restricted stock (256) -
Accumulated other comprehensive
gain (loss), net of income
taxes (319) (73) (11)
Retained earnings 28,079 20,970 18,739
--------- --------- ----------
Total stockholders'
equity 117% 92,842 63,118 42,843
--------- --------- ----------
Total liabilities and
stockholders' equity 63% $882,295 $641,606 $540,610
========= ========= ==========
CONSOLIDATED STATEMENT OF OPERATIONS
----------------------------------------------------------------------
(unaudited) (dollars in thousands, except per share data)
Quarter Ended Nine Months Ended
Qtly September 30, 9 mo. September 30,
% %
INTEREST INCOME Change 2005 2004 Change 2005 2004
------ ------- ------- ------ ------- -------
Interest on
loans $14,231 $7,522 $36,040 $21,585
Interest on fed
funds sold 59 52 208 124
Interest-earning
deposits with
banks 5 1 21 3
Interest on other
investments 568 232 1,357 726
------- ------- ------- -------
Total Interest
Income 90% 14,863 7,807 68% 37,626 22,438
INTEREST EXPENSE
Deposits 3,141 1,126 7,011 3,166
Other borrowed
money 661 267 1,653 794
------- ------- ------- -------
Total Interest
Expense 173% 3,802 1,393 119% 8,664 3,960
Net interest
income 72% 11,061 6,414 57% 28,962 18,478
Provision for loan
losses 430 325 1,161 838
------- ------- ------- -------
Net Interest
Income After
Loan Loss
Provision 75% 10,631 6,089 58% 27,801 17,640
OTHER OPERATING INCOME
Net gain on sale of
loans 1,533 1,952 5,240 4,938
Loan servicing
fees, net 221 221 700 614
Customer service
charges 295 185 793 569
Gain (Loss) on OREO
and other
repossessed assets - (160) 157 (160)
Other fee
income 418 335 881 956
------- ------- ------- -------
Total Other
Operating
Income -3% 2,467 2,533 12% 7,771 6,917
OTHER OPERATING EXPENSES
Salaries and
employee benefits 4,393 2,916 11,981 8,134
Occupancy 574 340 1,695 1,033
Depreciation 326 190 957 566
Other 2,143 1,890 6,365 5,374
------- ------- ------- -------
Total Other
Operating
Expenses 39% 7,436 5,336 39% 20,998 15,107
------- ------- ------- -------
Income before
income taxes 5,662 3,286 14,574 9,450
Income tax 2,278 1,256 5,820 3,573
------- ------- ------- -------
NET INCOME 67% $3,384 $2,030 49% $8,754 $5,877
======= ======= ======= =======
Per Share Data
Basic
earnings per
share 33% $0.61 $0.46 22% $1.63 $1.34
======= ======= ======= =======
Diluted
earnings per
share 35% $0.58 $0.43 23% $1.54 $1.25
======= ======= ======= =======
Average shares for
basic earnings per
share 5,575,666 4,402,605 5,358,607 4,385,565
Average shares for
diluted earnings
per share 5,880,790 4,705,546 5,669,102 4,685,097
SUPPLEMENTAL DATA
---------------------------------------------
(unaudited)(dollars in thousands, Quarter ended Year to date
except per share data) September 30, ended September
30,
---------------- ----------------
2005 2004 2005 2004
-------- ------- -------- -------
Annualized return on average assets 1.63% 1.57% 1.56% 1.56%
Annualized return on average equity 17.05% 19.76% 16.48% 19.64%
Annualized return on average tangible
equity 22.12% 19.76% 22.07% 19.64%
Efficiency ratio 54.97% 58.59% 57.41% 59.12%
Annualized net interest margin 5.81% 5.27% 5.71% 5.29%
Book value per share $15.64 $9.69
Tangible book value per share $8.20 $9.69
Dividends per share $0.10 $0.05 $0.30 $0.15
NON-PERFORMING ASSETS At September 30, At December 31,
----------------------------------------------------- ----------------
(unaudited)(dollars in thousands) 2005 2004 2004
-------- ------- --------
Non-accrual loans $2,721 $4,701 $4,027
Loans past due 90 days or more - - -
Restructured loans - - -
-------- ------- --------
Total non-performing loans 2,721 4,701 4,027
OREO & other repossessed assets 68 39 -
-------- ------- --------
Total non-performing assets $2,789 $4,740 $4,027
======== ======= ========
Total non-performing loans/gross
loans 0.37% 1.03% 0.74%
Total non-performing assets/total
assets 0.32% 0.88% 0.63%
Total non-performing loans net of
guarantees/gross loans 0.17% 0.62% 0.39%
Total non-performing assets net of
guarantees/total assets 0.15% 0.53% 0.33%
ALLOWANCE FOR LOAN LOSSES Quarter ended Year to date
September 30, ended September
30,
----------------------------------------------------- ----------------
(unaudited)(dollars in thousands) 2005 2004 2005 2004
-------- ------- -------- -------
Balance at beginning of period $8,392 $5,715 $7,508 $5,210
Reserve acquired in merger 1,269 - 1,269 -
Provision for loan losses 430 325 1,161 838
Recovery of (provision for) reserve for
losses on commitments to extend
credit - - - -
Net recoveries (chargeoffs) 33 (11) 186 (19)
-------- ------- -------- -------
Balance at end of period $10,124 $6,029 $10,124 $6,029
======== ======= ======== =======
Loan loss allowance/gross loans 1.37% 1.32%
Loan loss allowance/gross loans net
of guarantees 1.44% 1.43%
Loan loss allowance/loans held for
investment 1.72% 1.70%
Loan loss allowance/non-performing
loans 372.07% 128.25%
Loan loss allowance/non-performing
assets 363.00% 127.19%
Loan loss allowance/non-performing
loans, net of guarantees 830.52% 215.24%
Loan loss allowance/non-performing
assets, net of guarantees 786.64% 212.29%
Net Charge offs (recoveries) to
average loans (annualized) -0.02% 0.01% -0.04% 0.01%
CAPITAL RATIOS At September 30, At December 31,
----------------------------------------------------- ----------------
(unaudited) 2005 2004 2004
-------- ------- --------
Holding Company Ratios
Total capital (to risk-weighted
assets) 11.71% 13.08% 11.47%
Tier 1 capital (to risk-weighted
assets) 9.98% 11.68% 10.22%
Tier 1 capital (to average
assets) 10.00% 10.95% 9.48%
Tangible equity to tangible
assets 5.81% 7.92% 7.33%
Bank only Ratios
Total capital (to risk-weighted
assets) 11.30% 11.22% 11.19%
Tier 1 capital (to risk-weighted
assets) 10.05% 9.97% 9.94%
Tier 1 capital (to average
assets) 10.08% 9.35% 9.30%
(unaudited) (dollars in thousands)
-------------------------------------------------------------- -------
For the three months ended September 30,
2005 2004
------- -------
Average Interest Average Average InterestAverage
Balance Earned/ Rate/ Balance Earned/ Rate/
Paid Yield Paid Yield
------------------------------------------------
Average assets:
Securities and time
deposits at other
banks $57,055 $573 3.98% $22,157 $233 4.18%
Fed funds sold 6,735 59 3.48% 14,477 52 1.43%
Loans:
Commercial 53,867 990 7.29% 21,990 291 5.26%
Real Estate 585,905 12,297 8.33% 393,693 6,663 6.73%
Aircraft 31,843 546 6.80% 29,108 508 6.94%
Consumer 19,318 398 8.17% 3,040 60 7.85%
----------------- -----------------
Total
loans 690,933 14,231 8.17% 447,831 7,522 6.68%
----------------- -----------------
Total earning
assets 754,723 14,863 7.81% 484,465 7,807 6.41%
Non earning assets 77,068 33,899
--------- ---------
Total average
assets $831,791 $518,364
========= =========
Average liabilities and stockholders' equity:
Interest bearing deposits:
Savings and
interest
bearing
accounts $202,055 $482 0.95% $134,908 $155 0.46%
Time deposits 343,607 2,659 3.07% 233,611 971 1.65%
----------------- -----------------
Total
interest
bearing
deposits 545,662 3,141 2.28% 368,519 1,126 1.22%
Short term
borrowing 21,610 189 3.47% 8,470 32 1.51%
Long term debt 28,182 472 6.64% 14,676 235 6.37%
----------------- -----------------
Total interest
bearing
liabilities 595,454 3,802 2.53% 391,665 1,393 1.42%
Demand deposits 146,080 78,491
Accrued expenses
and other
liabilities 10,885 7,105
Net stockholders'
equity 79,372 41,103
--------- ---------
Total average
liabilities
stockholders'
equity $831,791 $11,061 $518,364 $6,414
================= =================
Net interest spread 5.28% 4.99%
====== =======
Net interest margin 5.81% 5.27%
====== =======
----------------------- ------------------------
For the nine months
ended September 30, 2005 2004
----------------------- ------------------------
Average assets:
Securities and time
deposits at other
banks $46,027 $1,378 4.00% $24,635 $729 3.95%
Fed funds sold 9,655 208 2.88% 14,831 124 1.12%
Loans:
Commercial 45,323 2,374 7.00% 21,473 871 5.42%
Real Estate 529,232 31,046 7.84% 372,276 18,951 6.80%
Aircraft 30,381 1,537 6.76% 29,893 1,569 7.01%
Consumer 17,851 1,083 8.11% 3,415 194 7.59%
----------------- -----------------
Total
loans 622,787 36,040 7.74% 427,057 21,585 6.75%
----------------- -----------------
Total earning
assets 678,469 37,626 7.41% 466,523 22,438 6.42%
Non earning assets 70,090 34,950
--------- ---------
Total average
assets $748,559 $501,473
========= =========
Average liabilities and stockholders' equity:
Interest bearing deposits:
Savings and
interest
bearing
accounts $191,558 $1,055 0.74% $124,103 $438 0.47%
Time deposits 300,642 5,956 2.65% 225,467 2,728 1.62%
----------------- -----------------
Total
interest
bearing
deposits 492,200 7,011 1.90% 349,570 3,166 1.21%
Short term
borrowing 25,290 576 3.05% 11,866 107 1.20%
Long term debt 21,235 1,077 6.78% 14,683 687 6.25%
----------------- -----------------
Total interest
bearing
liabilities 538,725 8,664 2.15% 376,119 3,960 1.41%
Demand deposits 129,072 78,627
Accrued expenses
and other
liabilities 9,917 6,834
Net stockholders'
equity 70,845 39,893
--------- ---------
Total average
liabilities
stockholders'
equity $748,559 $28,962 $501,473 $18,478
================= =================
Net interest spread 5.26% 5.01%
====== =======
Net interest margin 5.71% 5.29%
====== =======
*T