Exhibit 99.1
445 Pine Avenue, Goleta, CA 93117
FOR IMMEDIATE RELEASE
| Contact: | | Charles G. Baltuskonis, EVP/CFO |
| Phone: | | 805-692-5821 |
| E-mail: | | cbaltuskonis@communitywestbank.com |
| URL: | | www.communitywest.com |
| SYMBOL: | | CWBC (NASDAQ) |
Community West Bancshares Reports Q2 Net Income of $800,000
Book Value Per Common Share Increases to $7.78
Goleta, California, July 15, 2009 – Community West Bancshares (Company) (NASDAQ: CWBC), parent company of Community West Bank, today reported net income of $800,000 for the quarter ended June 30, 2009 (2009 Q2), compared to a net loss of $(252,000) for the quarter ended June 30, 2008 (2008 Q2). For the six months ended June 30, 2009, the Company reported a net loss of $(5,929,000) compared to net income of $745,000 for the six months ended June 30, 2008. Net income per diluted share available to common shareholders was $.09 for 2009 Q2 compared to a net loss of $(.04) for 2008 Q2.
Net Interest Income
Net interest income for the comparative quarter ended June 30, 2009 increased by $431,000, as the Company’s net interest margin increased by 5 basis points, to 3.78% for 2009 Q2 from 3.73% for 2008 Q2.
Total interest income for the comparative quarter ended June 30, 2009 decreased by $1,180,000. A $1,656,000 decrease is attributed to lower interest rates and is partially offset by a $476,000 increase attributed to loan growth.
Interest expense on deposits for the comparative quarter decreased by $1,389,000. $1,336,000 of the decrease is attributed to lower interest rates. Interest expense on borrowings decreased $222,000, primarily due to lower interest rates.
Provision for Loan Losses
The Company recorded a $743,000 loan loss provision in 2009 Q2, reflecting the detailed evaluation of its loan portfolio in the context of the overall challenging economic environment. During 2009 Q1, the Company experienced some deterioration and downgrades to specific loans in its portfolio, elevating the component of the allowance calculation related to historical loan losses. In general, the Company experienced elevated levels of loan losses over the past year thereby resulting in a significantly higher allowance requirement. The migration of the losses through the loan portfolio resulted in a calculated increase in the allowance from $7.3 million at December 31, 2008 to $13.4 million at June 30, 2009. This increase is directly related to the effect of historical loan losses on our estimate of losses inherent in the portfolio as of the balance sheet dates and does not necessarily reflect expected future losses. In addition, non-accrual loans slightly decreased from $16.9 million at December 31, 2008 to $16.0 million at June 30, 2009.
Non-Interest Income and Non-Interest Expenses
Non-interest income decreased by $385,000 to 2009 Q2 compared to 2008 Q2, primarily because 2008 Q2 included gains on loan and other asset sales.
Non-interest expenses increased by $70,000 to 2009 Q2 compared to 2008 Q2. While salaries and employee benefits decreased by $515,000, this was offset primarily by an increase of $198,000 in the FDIC regular deposit insurance assessment and $306,000 in the FDIC special deposit insurance assessment.
BALANCE SHEET
The Company’s total assets increased $14.0 million to $671.0 million at June 30, 2009 compared to $657.0 million at December 31, 2008. Net loans increased by $15.5 million and combined liquid assets and investment securities decreased by a net of $6.4 million.
On the funding side, as of June 30, 2009, deposits increased by $11.2 million while FHLB and FRB advances increased by $9.0 million compared to December 31, 2008.
CAPITAL
As of June 30, 2009, the Company had $60.4 million in total shareholders’ equity, or 9.01% of consolidated total assets, and book value per common share was $7.78. The Company and Community West Bank continue to operate at capital levels in excess of the “well capitalized” benchmarks.
COMMENTS FROM PRESIDENT AND CHIEF EXECUTIVE OFFICER
Lynda J. Nahra, President and Chief Executive Officer, noted: “While the banking and economic environment nationally and in California continue to be unsettled, we are generally pleased with the Q2 results. The margin improvement and Q1 cost reductions should continue to enhance operating earnings. We will continue to focus on credit quality and our overall balance sheet strength."
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 California 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.
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 BALANCE SHEETS | | | | | | |
| (unaudited) | |
| (in 000's, except per share data) | | | | | | |
| | | | | | | |
| | | June 30 | | | December 31 | |
| | | 2009 | | | 2008 | |
| | | | | | | |
| Cash and cash equivalents | | $ | 7,577 | | | $ | 12,253 | |
| Interest-earning deposits in other financial institutions | | | 732 | | | | 812 | |
| Investment securities | | | 36,308 | | | | 37,975 | |
| Loans: | | | | | | | | |
| Held for sale | | | 102,072 | | | | 131,786 | |
| Held for investment | | | 507,886 | | | | 456,630 | |
| Less: Allowance | | | (13,419 | ) | | | (7,341 | ) |
| Net held for investment | | | 494,467 | | | | 449,289 | |
| NET LOANS | | | 596,539 | | | | 581,075 | |
| | | | | | | | | |
| Other assets | | | 29,846 | | | | 24,866 | |
| | | | | | | | | |
| TOTAL ASSETS | | $ | 671,002 | | | $ | 656,981 | |
| | | | | | | | | |
| Deposits | | $ | 486,640 | | | $ | 475,439 | |
| FHLB and FRB advances | | | 119,000 | | | | 110,000 | |
| Other liabilities | | | 4,915 | | | | 4,924 | |
| TOTAL LIABILITIES | | | 610,555 | | | | 590,363 | |
| | | | | | | | | |
| Stockholders' equity | | | 60,447 | | | | 66,618 | |
| | | | | | | | | |
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | | $ | 671,002 | | | $ | 656,981 | |
| | | | | | | | | |
| Shares outstanding | | | 5,915 | | | | 5,915 | |
| | | | | | | | | |
| Book value per common share | | $ | 7.78 | | | $ | 8.84 | |
| | | | | | | | | |
******************************************************************************************************** | |
| | | | | | | | | |
| Non-accrual loans, net | | $ | 16,011 | | | $ | 16,903 | |
| | | | | | | | | | | | |
| CONDENSED CONSOLIDATED INCOME STATEMENTS | | | | | | | | | | | | |
| (unaudited) | | | | | | | | | | | | |
| (in 000's, except per share data) | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| | | Quarter Ended June 30, | | | Six Months Ended June 30, | |
| | | 2009 | | | 2008 | | | 2009 | | | 2008 | |
| | | | | | | | | | | | | |
| Interest income | | $ | 10,200 | | | $ | 11,380 | | | $ | 20,417 | | | $ | 23,391 | |
| Interest expense | | | 3,966 | | | | 5,577 | | | | 8,420 | | | | 11,427 | |
| Net interest income | | | 6,234 | | | | 5,803 | | | | 11,997 | | | | 11,964 | |
| Provision for loan losses | | | 743 | | | | 2,531 | | | | 13,298 | | | | 3,204 | |
| Net interest income (loss) after provision for loan losses | | | 5,491 | | | | 3,272 | | | | (1,301 | ) | | | 8,760 | |
| | | | | | | | | | | | | | | | | |
| Non-interest income | | | 1,255 | | | | 1,640 | | | | 2,423 | | | | 3,054 | |
| Non-interest expenses | | | 5,383 | | | | 5,313 | | | | 11,190 | | | | 10,493 | |
| Income (loss) before income taxes | | | 1,363 | | | | (401 | ) | | | (10,068 | ) | | | 1,321 | |
| Provision (benefit) for income taxes | | | 563 | | | | (149 | ) | | | (4,139 | ) | | | 576 | |
| | | | | | | | | | | | | | | | | |
| NET INCOME (LOSS) | | $ | 800 | | | $ | (252 | ) | | $ | (5,929 | ) | | $ | 745 | |
| | | | | | | | | | | | | | | | | |
| Preferred stock dividends | | | 262 | | | | - | | | | 523 | | | | - | |
| | | | | | | | | | | | | | | | | |
| NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS | | $ | 538 | | | $ | (252 | ) | | $ | (6,452 | ) | | $ | 745 | |
| | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
| Earnings (loss) per common share: | | | | | | | | | | | | | | | | |
| Basic | | $ | 0.09 | | | $ | (0.04 | ) | | $ | (1.09 | ) | | $ | 0.13 | |
| Diluted | | | 0.09 | | | | (0.04 | ) | | | (1.09 | ) | | | 0.12 | |
| | | | | | | | | | | | | | | | | |
| Weighted average shares: | | | | | | | | | | | | | | | | |
| Basic | | | 5,915 | | | | 5,913 | | | | 5,915 | | | | 5,911 | |
| Diluted | | | 5,915 | | | | 5,913 | | | | 5,915 | | | | 5,974 | |
| | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
********************************************************************************************************* | |
| Selected average balance sheet items | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
| Average assets | | $ | 672,094 | | | $ | 641,794 | �� | | $ | 672,415 | | | $ | 632,238 | |
| Average gross loans | | | 605,684 | | | | 567,310 | | | | 602,648 | | | | 559,955 | |
| Average deposits | | | 487,964 | | | | 476,513 | | | | 486,461 | | | | 463,528 | |
