445 Pine Avenue, Goleta, CA 93117
FOR IMMEDIATE RELEASE
Contact: | Charles G. Baltuskonis, EVP/CFO |
E-mail: | cbaltuskonis@communitywestbank.com |
URL: | http://www.communitywestbank.com |
Community West Bancshares Reports Earnings for 2007 Second Quarter
Goleta, California, July 24, 2007 – Community West Bancshares (Company) (NASDAQ: CWBC), parent company of Community West Bank, today reported net income of $1,252,000, or $.21 per share diluted, for the quarter ended June 30, 2007 (2007 Q2), compared to $1,289,000, or $.21 per share diluted, for the quarter ended June 30, 2006 (2006 Q2).
Net Interest Income
Net interest income for the comparative quarters increased by $525,000.
Total interest income for the comparative quarters increased by $2,247,000. $1,972,000 of the increase is attributed to the strong comparative growth in interest-earning assets, primarily in the commercial real estate lending, SBA and manufactured housing portfolios, partially offset by the decrease in securitized loans; and, $275,000 of the increase is attributed to higher interest rates.
Interest expense on deposits for the comparative three-month period increased by $1,318,000. $759,000 of the increase is attributed to interest-bearing deposit growth and $559,000 is attributed to higher interest rates. Interest expense on borrowings increased by $404,000, which is primarily volume-related.
The Company’s net interest margin decreased by 48 basis points, to 4.45% for 2007 Q2 from 4.93% for 2006 Q2.
Provision for Loan Losses
Overall, the general portfolio credit quality continues to be relatively stable and the Company continues to benefit from the low amounts of classified loans and net charge-offs. 2007 Q2 had a $63,000 credit to the provision for loan losses, primarily because some SBA unguaranteed loans were sold.
Non-Interest Income and Non-Interest Expenses
Non-interest income decreased by $177,000 from 2006 Q2 to 2007 Q2, primarily from a decline in gains from loan sales, as management strategically sold fewer loans.
Non-interest expenses increased by $616,000 in 2007 Q2, due primarily to overall staff growth, including an additional branch location and further development of two other branches that were added in the past two years, lending production commissions and general promotional expenses.
BALANCE SHEET
The Company’s total assets increased to $561.9 million, or $45.3 million, at June 30, 2007 compared to $516.6 million at December 31, 2006.
Net loans increased to $484.7 million, or $33.1 million, at June 30, 2007 compared to $451.6 million at December 31, 2006, and combined liquid assets and investment securities increased by a net of $10.5 million.
On the funding side in 2007, deposits increased to $411.1 million, or $42.4 million, at June 30, 2007 compared to $368.7 million at December 31, 2006.
CAPITAL
As of June 30, 2007, the Company had $48.7 million in total shareholders’ equity, or 8.66% of consolidated total assets, and book value per share was $8.30.
DIVIDEND DECLARED
The Board of Directors announced that they have declared a quarterly dividend of $.06 per common share, payable August 17, 2007 to shareholders of record as of the close of business on August 3, 2007. At this quarterly rate, the annual dividend is equivalent to $.24 per common share.
COMMENTS FROM PRESIDENT AND CHIEF EXECUTIVE OFFICER
Lynda J. Nahra, President and Chief Executive Officer, noted: “In 2007 Q2, we continued to make progress in growing the Bank and we had a particularly strong quarter in business lending. We remain focused on developing our franchise brand, maintaining strength in our core business lines and credit quality, and improving our net interest margin despite the current yield curve and competitive environment.”
COMPANY OVERVIEW
Community West Bancshares is a financial services company with headquarters in Goleta, California. The Company is the holding company for Community West Bank, which has five full-service branch banking offices, in Goleta, Ventura, Santa Maria, Santa Barbara and Westlake Village. The principal business activities of the Company are Relationship banking, Mortgage lending and SBA lending, with loans originating in California, Alabama, Colorado, Florida, Georgia, Maryland, North Carolina, Ohio, Oregon, South Carolina, Tennessee and Washington.
See enclosed financial tables
Safe Harbor Disclosure
This release contains forward-looking statements that reflect management's current views of future events and operations. These forward-looking statements are based on information currently available to the Company as of the date of this release. It is important to note that these forward-looking statements are not guarantees of future performance and involve risks and uncertainties, including, but not limited to, the ability of the Company to implement its strategy and expand its lending operations.
COMMUNITY WEST BANCSHARES
CONDENSED CONSOLIDATED INCOME STATEMENTS
(unaudited)
(in 000's, except per share data)
| | | Three Months Ended June 30, | | | Six Months Ended June 30, | |
| | | 2007 | | | 2006 | | | 2007 | | | 2006 | |
| | | | | | | | | | | | | |
| Interest income | | $ | 11,624 | | | $ | 9,377 | | | $ | 22,672 | | | $ | 18,426 | |
| Interest expense | | | 5,630 | | | | 3,908 | | | | 10,933 | | | | 7,424 | |
| Net interest income | | | 5,994 | | | | 5,469 | | | | 11,739 | | | | 11,002 | |
| Provision for loan losses | | | (63 | ) | | | 144 | | | | 222 | | | | 325 | |
| Net interest income after provision for loan losses | | | 6,057 | | | | 5,325 | | | | 11,517 | | | | 10,677 | |
| Non-interest income | | | 1,402 | | | | 1,579 | | | | 2,577 | | | | 2,906 | |
| Non-interest expenses | | | 5,303 | | | | 4,687 | | | | 10,502 | | | | 9,197 | |
| | | | | | | | | | | | | | | | | |
| Income before income taxes | | | 2,156 | | | | 2,217 | | | | 3,592 | | | | 4,386 | |
| Provision for income taxes | | | 904 | | | | 928 | | | | 1,514 | | | | 1,838 | |
| | | | | | | | | | | | | | | | | |
| NET INCOME | | $ | 1,252 | | | $ | 1,289 | | | $ | 2,078 | | | $ | 2,548 | |
| | | | | | | | | | | | | | | | | |
| Earnings per share: | | | | | | | | | | | | | | | | |
| Basic | | $ | 0.21 | | | $ | 0.22 | | | $ | 0.36 | | | $ | 0.44 | |
| Diluted | | | 0.21 | | | | 0.21 | | | | 0.34 | | | | 0.43 | |
| | | | | | | | | | | | | | | | | |
| Weighted average shares: | | | | | | | | | | | | | | | | |
| Basic | | | 5,856 | | | | 5,781 | | | | 5,840 | | | | 5,774 | |
| Diluted | | | 6,038 | | | | 6,000 | | | | 6,035 | | | | 5,988 | |
| | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
Selected average balance sheet items | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
| Average assets | | $ | 554,993 | | | $ | 459,084 | | | $ | 545,251 | | | $ | 455,349 | |
| Average gross loans | | | 482,758 | | | | 401,717 | | | | 475,086 | | | | 393,664 | |
COMMUNITY WEST BANCSHARES
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
(in 000's, except per share data)
| | | June 30, | | | December 31, | |
| | | 2007 | | | 2006 | |
| | | | | | | |
| Cash and cash equivalents | | $ | 18,550 | | | $ | 11,343 | |
| Interest-earning deposits in other financial institutions | | | 655 | | | | 536 | |
| Investment securities | | | 35,817 | | | | 32,632 | |
| Loans: | | | | | | | | |
| Held for sale | | | 93,391 | | | | 75,795 | |
| Held for investment | | | 395,339 | | | | 379,703 | |
| Less: Allowance | | | (4,047 | ) | | | (3,926 | ) |
| Net held for investment | | | 391,292 | | | | 375,777 | |
| NET LOANS | | | 484,683 | | | | 451,572 | |
| | | | | | | | | |
| Other assets | | | 22,171 | | | | 20,532 | |
| | | | | | | | | |
| TOTAL ASSETS | | $ | 561,876 | | | $ | 516,615 | |
| | | | | | | | | |
| Deposits | | $ | 411,082 | | | $ | 368,747 | |
| FHLB advances | | | 96,000 | | | | 95,000 | |
| Other liablities | | | 6,142 | | | | 6,048 | |
| TOTAL LIABILITIES | | | 513,224 | | | | 469,795 | |
| | | | | | | | | |
| Stockholders' equity | | | 48,652 | | | | 46,820 | |
| | | | | | | | | |
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | | $ | 561,876 | | | $ | 516,615 | |
| | | | | | | | | |
| Shares outstanding | | | 5,863 | | | | 5,815 | |
| | | | | | | | | |
| Book value per share | | $ | 8.30 | | | $ | 8.05 | |
| | | | | | | | | |
| | | | | | | | | |
| Nonaccrual loans | | $ | 8,034 | | | $ | 7,417 | |
| SBA guaranteed portion | | | (5,085 | ) | | | (4,256 | ) |
| | | | | | | | | |
| Nonaccrual loans, net | | $ | 2,949 | | | $ | 3,161 | |
