Open Bank Announces the Fourth Quarter 2012 Results

Open Bank Announces the Fourth Quarter 2012 Results

LOS ANGELES--(BUSINESS WIRE)-- Open Bank (OTCBB:OPBK) today announced a net income of $784 thousand for the fourth quarter of 2012 and $6.2 million for the twelve months ended December 31, 2012, compared to $131 thousand for the fourth quarter of 2011 and $1.5 million for the twelve months ended December 31, 2011.

Min Kim, President and Chief Executive Officer, said, "Despite the numerous challenges we faced in 2012, including a difficult economic environment, 2012 turned out to be a banner year for the bank. With the lifting of the Consent Orders we are poised for the expansion of our branch offices, where we can provide better services to our customers. Following the opening in November of 2012 of our first branch in the Fashion District of downtown Los Angeles, we opened our second branch in Gardena, California today. We are continuing to seek additional branch locations in Southern California.


"Another important milestone we achieved in 2012 was crossing the $200 million threshold in the Bank's assets as of December 31, 2012, compared to $142 million as of December 31, 2012. We continued to maintain a high level of demand deposits, at 32% of total deposits as of December 31, 2012, which enabled us to achieve the net interest margin of 4.97% for the quarter. Our asset quality has continued to improve and our Allowance for Loan Losses to Gross Loans dropped below 3%. These successes have allowed us to give back more to our community in 2012. I am very proud of our team for their hard work and grateful to our Board of Directors for their support throughout the year."

Fourth Quarter 2012 Highlights:

  • Net income of $784 thousand for the three months ended December 31, 2012.

  • Net income of $6.2 million for the twelve months ended December 31, 2012. Reversal of valuation allowance on DTA of $4 million included.

  • Net interest margin was 4.97% for the fourth quarter of 2012, compared to 4.37% for the fourth quarter of 2011.

  • Demand deposits increased 64.14% to $55.0 million representing 31.59% of total deposits of $174.0 million at December 31, 2012, from $33.5 million, 27.61% of total deposits of $121.3 million, at December 31, 2011.

  • Allowance for Loan Losses to Gross Loans was 2.71% at December 31, 2012, compared to 4.76% at December 31, 2011.

  • Non-performing assets to total assets improved significantly to 1.00% at December 31, 2012, compared to 4.65% at December 31, 2011.

  • The Total risk-based capital ratio, tier 1 capital ratio and tier 1 leverage ratio were 15.72%, 14.45% and 13.84%, respectively at December 31, 2012.

About Open Bank

Open Bank (the "Bank") is engaged in the general commercial banking business in Los Angeles County and is focused on serving the banking needs of small- and medium-sized businesses, professionals, and residents with a particular emphasis on the Korean and other ethnic minority communities. The Bank commenced its operations on June 10, 2005 as First Standard Bank and changed its name to Open Bank on September 20, 2010. Its headquarters are located at 1000 Wilshire Blvd., Suite 100 Los Angeles, California 90017. Phone 213.892.9999; www.myopenbank.comMember FDIC, Equal Housing Lender

Safe Harbor

This press release contains certain forward-looking information about Open Bank that is intended to be covered by the safe harbor for "forward-looking statements" provided by the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact are forward-looking statements. These forward-looking statements may include, but are not limited to, such words as "believes," "expects," "anticipates," "intends," "plans," "estimates," "may," "will," "should," "could," "predicts," "potential," "continue," or the negative of such terms and other comparable terminology or similar expressions and may include statements about the bank's focus on exploring new opportunities, building customer relationship through core deposits, growing core deposits, and improving asset quality. Forward-looking statements are not guarantees. Such statements involve inherent risks and uncertainties, many of which are difficult to predict and are generally beyond the control of Open Bank such as the ability of the new branch to attract sufficient number of customers, deposits and new business to become profitable. Open Bank cautions readers that a number of important factors could cause actual results to differ materially from those expressed in, or implied or projected by, such forward-looking statements. If any of these risks or uncertainties materializes or if any of the assumptions underlying such forward-looking statements proves to be incorrect, Open Bank's results could differ materially from those expressed in, or implied or projected by such forward-looking statements. Open Bank assumes no obligation to update such forward-looking statements, except as required by law.

Balance Sheet

(Dollars in thousand, except per share data)

December 31, 2012

December 31, 2011

(Unaudited)

(Audited)

Assets

Cash and due from banks

$

25,146

$

19,595

Federal fund sold/overnight investment

-

-

Investment securities

8,824

10,023

Loans held for sale

7,659

2,892

Loans receivable

150,424

103,688

Allowance for loan losses

4,407

4,939

Net loans

158,084

106,580

Bank premises and equipment, net

1,120

331

Accrued interest receivable

493

451

FHLB and Pacific Coast Bankers Bank Stock, at cost

813

732

Servicing assets

2,716

1,467

Net deferred taxes

4,000

-

Other assets

4,947

3,204

Total Assets

$

206,142

$

142,383

Liabilities and Shareholders' Equity

Noninterest bearing demand

$

54,961

$

33,484

Savings

522

2,518

Money market and others

60,969

40,055

Time deposits of $100,000 or more

29,694

21,616

Other time deposits

27,846

23,608

Total deposits

173,992

121,281

FHLB borrowings

5,000

-

Other liabilities

1,257

1,683

Total liabilities

180,250

122,965

Total shareholders' equity

25,892

19,418

Total Liabilities and Shareholders' Equity

$

206,142

$

142,383

Statement of Operations

(Dollars in thousand, except per share data)

Three months ended

Twelve months ended

December 31, 2012

December 31, 2011

December 31, 2012

December 31, 2011

Interest income

$

2,192

$

1,692

$

7,464

$

6,632

Interest expense

197

273

766

1,204

Net interest income

1,995

1,419

6,699

5,428

Provision for loan losses

500

700

2,273

2,162

Non interest income

1,797

1,176

6,285

5,450

Non interest expense

2,492

1,715

8,500

7,027

Income before income taxes

800

180

2,210

1,688

Provision for income taxes

16

49

(3,985

)

157

Net income (loss)

$

784

$

131

$

6,195

$

1,532

Book Value

$

3.62

$

2.72

$

3.62

$

2.72

Basic EPS

$

0.11

$

0.02

$

0.87

$

0.22

Diluted EPS

$

0.07

$

0.02

$

0.57

$

0.19

Key Ratios

Return on average assets (ROA) *

1.76

%

0.38

%

4.03

%

1.18

%

ROA, excluding tax benefit *

1.80

%

-

1.44

%

-

Return on average equity (ROE) *

12.30

%

2.70

%

26.41

%

8.58

%

ROE, excluding tax benefit *

14.87

%

-

10.82

%

-

Net interest margin *

4.97

%

4.37

%

4.84

%

4.39

%

Efficiency ratio

75.69

%

65.71

%

79.36

%

64.51

%

Tier 1 leverage

13.83

%

14.06

%

13.83

%

14.06

%

Tier 1 risk-based capital

14.44

%

16.38

%

14.44

%

16.38

%

Total risk-based capital

15.71

%

17.67

%

15.71

%

17.67

%

Asset Quality

12/31/2012

9/30/2012

6/30/2012

3/31/2012

12/31/2011

Loans 90 days or more past due, accruing

-

-

-

-

-

Nonaccrual Loans

1,621

1,850

897

5,078

4,826

Total Non-Performing Loans

1,621

1,850

897

5,078

4,826

Other Real Estate Loans (OREO)

456

456

-

-

-

Accruing Restructured Loans

876

1,052

1,071

1,086

2,061

Total Non-Performing Assets

2,953

3,358

1,968

6,164

6,887

Non-Performing Loans/Total Loans

1.00

%

1.57

%

0.76

%

4.78

%

4.65

%

Non-Performing Assets/Total Assets

1.43

%

1.98

%

1.32

%

4.30

%

4.84

%

Allowance for Loan Losses/Gross Loans

2.71

%

3.79

%

3.47

%

4.31

%

4.76

%

Allowance for Loan Losses/Non-Performing Loans

272

%

241

%

458

%

90

%

102

%

YTD Net Charge-offs

$

2,805

$

2,263

$

1,908

$

724

$

1,344

YTD Net Charge-offs to Average Loans *

2.21

%

2.53

%

3.25

%

2.56

%

1.22

%

* Annualized



Open Bank
Christine Oh, 213-892-1192
Christine.oh@myopenbank.com

KEYWORDS: United States North America California

INDUSTRY KEYWORDS:

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