Cornerstone Community Bank Reports Financial Results for the Second Quarter Ended June 30, 2013

Cornerstone Community Bank Reports Financial Results for the Second Quarter Ended June 30, 2013

RED BLUFF, Calif.--(BUSINESS WIRE)-- Cornerstone Community Bank (OTCBB: CRSB) announced today its financial results for the second quarter ended June 30, 2013.

The Bank reported net income of $282,000 for the three months ended June 30, 2013 representing an increase of $29,000, or 11%, compared to net income of $253,000 for the same period last year. Diluted earnings per share for the three months ended June 30, 2013 were $0.22 compared to $0.20 for the same period last year. Net income for the six months ended June 30, 2013 was $522,000, or $0.40 per diluted share compared to net income of $472,000, or $0.37 per diluted share, for the six months ended June 30, 2012.


The return on average assets for the three months ended June 30, 2013 was 0.97% compared to 1.00% for the same period last year. The return on average equity was 9.24% for the three months ended June 30, 2013 compared to 9.47% for the same period last year. For the six months ended June 30, 2013, the return on average assets was 0.91% and the return on average equity was 8.63% compared to 0.96% and 8.99%, respectively, for the six months ended June 30, 2012.

"Cornerstone Community Bank continues to deliver solid growth. Our year-over-year total loan growth was 24% and our year-over-year deposit growth was 16%," said President and CEO Jeff Finck.

Net Interest Income

Net interest income of $1,162,000 for the quarter ended June 30, 2013 represented a decrease of $20,000, or 2%, from $1,182,000 for the same quarter one year earlier. The net interest margin decreased to 4.20% during the quarter ended June 30, 2013 compared to 4.90% during the same quarter last year. For the six months ended June 30, 2013, net interest income was $2,369,000 compared to $2,177,000 for the six months ending June 30, 2012 representing an increase of $192,000, or 9%. The net interest margin decreased to 4.34% for the six months ended June 30, 2013 compared to 4.68% for the six months ended June 30, 2012.

Provision for credit losses

There was no provision for credit losses for the quarter ended June 30, 2013 compared to $135,000 for the quarter ended June 30, 2012. The provision for credit losses for the six months ended June 30, 2013 was $85,000 compared to $135,000 for the six months ended June 30, 2012.

Non-Interest Income

The Bank's non-interest income for the quarter ended June 30, 2013 was $234,000 compared to $122,000 for the quarter ended June 30, 2012. For the six months ended June 30, 2013, non-interest income was $373,000 compared to $237,000 for the same period last year.

Non-Interest Expense

Non-interest expense was $1,114,000 for the quarter ended June 30, 2013 compared to $940,000 for the same period one year earlier. For the six months ended June 30, 2013, non-interest expense was $2,135,000 compared to $1,855,000 for the same period last year.

Balance Sheet

The Bank had total assets at June 30, 2013 of $118.3 million, compared to $102.8 million at June 30, 2012, representing growth of $15.5 million, or 15%.

Total loans outstanding, including loans held for sale, at June 30, 2013, were $85.0 million compared to $68.8 million at June 30, 2012, representing an increase of $16.2 million, or 24%.

Total deposits were $105.9 million at June 30, 2013 compared to total deposits of $91.4 million at June 30, 2012, representing an increase of $14.5 million, or 16%.

Credit Quality

The allowance for loan losses was $1,450,000, or 1.76% of loans, net of unearned income at June 30, 2013, compared to $1,325,000, or 1.94% of loans, net of unearned income at June 30, 2012. Nonperforming assets at June 30, 2013 were $268,000 compared to $85,000 at June 30, 2012.

The bank recognized $96,000 in net loan charge-offs during the six months ended June 30, 2013, representing 0.24% of average loans.

Capital Adequacy

At June 30, 2013, shareholders' equity totaled $12.0 million compared to $10.9 million at June 30, 2012. At June 30, 2013, the total risk-based capital ratio, tier one capital ratio, and leverage ratio was 13.71%, 12.45% and 10.06%, respectively, all exceeding the regulatory standards for "well-capitalized" institutions of 10.00%, 6.00% and 5.00%, respectively.

About Cornerstone Community Bank

Cornerstone Community Bank is a California state-chartered bank with its headquarters office in Red Bluff and a branch office in Redding. The Bank provides commercial banking services, including a wide variety of deposit products and real estate, construction, commercial and consumer loans to small businesses, professionals and individuals. Additional information about the Bank is available on its website at www.bankcornerstone.com.

Forward-Looking Statements

This press release contains forward-looking statements.These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of the management of Cornerstone Community Bank and on information available to management at the time these statements were made.There are a number of factors, many of which are beyond Cornerstone Community Bank's control, which could cause actual conditions, events or results to differ significantly from those described in the forward-looking statements.Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, among others, the following possibilities: (1) competitive pressures among depository and other financial institutions may increase significantly; (2) revenues may be lower than expected; (3) changes in the interest rate environment may reduce interest margins; (4) general economic conditions, either nationally or regionally, may be less favorable than expected, resulting in, among other things, a deterioration in credit quality and/or a reduced demand for credit; (5) legislative or regulatory changes, including changes in accounting standards and tax laws, may adversely affect the businesses in which Cornerstone Community Bankis engaged; (6) competitors may have greater financial resources and develop products that enable such competitors to compete more successfully than Cornerstone Community Bank; and (7) adverse changes may occur in the securities markets or with respect to inflation.Forward-looking statements speak only as of the date they are made.Except as required by law, Cornerstone Community Bank does not undertake to update forward-looking statements to reflect subsequent circumstances or events.

 
CORNERSTONE COMMUNITY BANK
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(Dollars in Thousands)
     
 
 
 06/30/13   03/31/13   12/31/12   09/30/12   06/30/12 
 
ASSETS
Cash and due from banks$2,950$4,009$3,091$2,389$3,507
Federal funds sold-----
Interest-bearing deposits2,7961,2414,9361,1202,200
Investment securities23,10425,74527,14328,67226,129
Loans held for sale2,6031,961791573336
Loans, net of unearned income82,38180,46773,82072,24068,459
Allowance for loan losses (1,450)  (1,411)  (1,460)  (1,469)  (1,325)
Loans, net80,93179,05672,36070,77167,134
Premises and equipment, net1,0411,1001,0701,1261,165
Other assets 4,854   2,230   2,301   2,294   2,354 
Total assets$118,279  $115,342  $111,692  $106,945  $102,825 
 
LIABILITIES
Deposits:
Demand noninterest-bearing$19,892$18,260$22,366$15,104$12,648
Demand interest-bearing16,11014,31814,89315,59413,100
Money market and savings40,12344,99637,63439,50942,072
Time deposits of less than $100,00011,2368,2188,9659,0478,949
Time deposits of $100,000 or more 18,578   17,241   15,795   14,991   14,628 
Total deposits105,939103,03399,65394,24591,397
Other borrowings---1,000-
Other liabilities 311   226   248   279   557 
Total liabilities 106,250   103,259   99,901   95,524   91,954 
 
SHAREHOLDERS' EQUITY
Common stock11,95911,95911,95911,95911,959
Additional paid-in capital859830801772741
Accumulated deficit(917)(1,199)(1,439)(1,764)(2,178)
Accumulated other comprehensive income (loss) 128   493   470   454   349 
Total shareholders' equity 12,029   12,083   11,791   11,421   10,871 
Total liabilities and shareholders' equity$118,279  $115,342  $111,692  $106,945  $102,825 
 
CAPITAL ADEQUACY
Tier I leverage ratio10.06%10.13%10.32%10.12%10.26%
Tier I risk-based capital ratio12.45%12.81%13.29%13.17%13.03%
Total risk-based capital ratio13.71%14.06%14.55%14.43%14.29%
Total equity / total assets10.17%10.48%10.56%10.68%10.57%
Book value per share$10.02$10.07$9.83$9.52$9.06
 
 
CORNERSTONE COMMUNITY BANK
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(Dollars in Thousands)
           
 
 
 
Three months endedSix months ended
 06/30/13   03/31/13   06/30/12  06/30/13   06/30/12 
 
INTEREST INCOME
Loans$1,143$1,184$1,180$2,327$2,170
Federal funds sold-----
Investment securities163170181333361
Other 2   2   3    4   5 
Total interest income 1,308   1,356   1,364    2,664   2,536 
 
INTEREST EXPENSE
Deposits:
Interest-bearing demand7671313
Money market and savings7574100149193
Time deposits646975133153
Other -   -   -    -   - 
Total interest expense 146   149   182 Read Full Story

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