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EXHIBIT 99.1
445 PINE AVENUE, GOLETA, CA 93117
FOR IMMEDIATE RELEASE
CONTACT: CHARLES G. BALTUSKONIS, SVP/CFO
PHONE: 805-692-4409
E-MAIL: CBALTUSKONIS@GOLETA.COM
URL: HTTP: //WWW.COMMUNITYWEST.COM
SYMBOL: CWBC
COMMUNITY WEST BANCSHARES ANNOUNCES INCREASE IN FIRST QUARTER NET INCOME TO $.06
PER SHARE
Goleta, California, April 24, 2003 - Community West Bancshares (Company) today
announced operating results for the first quarter of 2003.
EARNINGS AND OPERATIONS
The Company recorded net income of $348,000, or $.06 per share (basic and
diluted), for the quarter ended March 31, 2003 (2003 Q 1), compared to net loss
of $(949,000), or $(.17) per share (basic and diluted), for the quarter ended
March 31, 2002 (2002 Q 1).
Net interest income after provision for loan losses increased to $2,217,000 for
2003 Q 1 from $1,398,000 for 2002 Q 1. Net interest income before provision for
loan losses decreased to $2,561,000 for 2003 Q 1 from $3,674,000 for 2002 Q 1.
There was a general decline in interest rates in the quarterly comparison, which
have narrowed the Company's net interest margin, but the primary reason for the
margin decrease is the termination of the high-yield, short-term consumer
lending business. While the net interest margin compressed, the provision for
loan losses was $344,000 for 2003 Q 1 compared to $2,276,000 for 2002 Q 1.
During fiscal 2002 and continuing on to fiscal 2003, the credit quality has
substantially improved, primarily due to the Company's tightened credit
underwriting standards and the discontinuance of certain loan products. This
includes high loan-to-value (HLTV) and subprime lending loans, discontinued in
the second quarter of 2002, and short-term consumer loans, formally discontinued
as of December 31, 2002. In addition, the securitized loan portfolio continues
to stabilize and pay down. The aforementioned product discontinuance, and the
centralization of the support functions of the Small Business Administration
(SBA) and Mortgage Lending Division of Goleta National Bank (Goleta or Bank),
along with internal cost reduction programs, contributed to a decrease in
non-interest expenses to $4,355,000 in 2003 Q 1 from $6,409,000 in 2002 Q 1.
As previously announced, commencing in 2003 Q 1, the Company significantly
expanded its SBA lending division by acquiring a group of seasoned SBA lending
professionals, enabling the bank to have an expanded presence in Northern
California, specifically the Sacramento and Bay areas. This group is expected
to contribute positively to net income by the second half of fiscal 2003.
Included in the 2003 Q 1 non-interest expenses is $241,000 related to the
start-up of this SBA business.
Lynda Nahra, President of Goleta, noted: "Our profit improvement initiatives
that we started in 2002 are continuing to have a favorable impact on our
operating results. 2003 Q 1 is the third consecutive profitable quarter. We
continue to show benefits from prudent credit risk management and overall cost
containment. While we remain cautious on the outlook for the rest of 2003, this
performance gives us confidence in our strategic plan and leaves the Company
well-positioned for the eventual national economic recovery."
As previously announced, as of December 31, 2002, Goleta ceased making
short-term consumer loans through its agent, ACE Cash Express (ACE). As part of
that agreement, ACE agreed to indemnify 100%, instead of the prior 90%, of
Goleta's losses and expenses incurred after November 1, 2002 from certain
third-party claims regarding such loans, including pending and future legal
proceedings. To replace such assets, and as part of its strategic plan, the
Company plans to continue to focus on its presence in Relationship Banking and
periodically retain for its own portfolio more SBA loans, particularly the
guaranteed portions. In addition, the Company is methodically working on ways
to improve its net interest margin, including the short-term investing in
government-agency guaranteed securities. These initiatives, in conjunction with
our continued focus on controlling expenses, are intended to enhance the
Company's overall operating performance.
CAPITAL
As of March 31, 2003, the Company had $32,442,000 in equity capital, or 10.94%
of consolidated total assets. Additionally, Goleta had a very strong risk-based
capital ratio of 13.94% as of March 31, 2003. Book value per share of the
Company as of March 31, 2003 was $5.70.
COMPANY OVERVIEW
Community West Bancshares is a financial services company with headquarters in
Goleta, California. The Company is the holding company for Goleta National
Bank, which has two full service branches, one in Goleta and one in Ventura,
California. Goleta is one of the Nation's largest SBA lenders with loan
production offices located in California, Florida, Georgia, Nevada, North
Carolina, Oregon, South Carolina and Washington. The principal business
activities of the Company are Relationship Banking, Small Business
Administration (SBA) Lending and Mortgage 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. Furthermore, the Company has
certain restrictions placed on its operations by the Office of the Comptroller
of the Currency (OCC) until the OCC deems that Goleta has substantially complied
with the Consent Order, issued by the OCC on October 28, 2002 and signed by
Goleta, and releases Goleta therefrom.
COMMUNITY WEST BANCSHARES
CONDENSED CONSOLIDATED BALANCE SHEET
(unaudited)
(in 000's, except share and per share data)
March 31, 2003 December 31, 2002
---------------- -------------------
Cash and cash equivalents $ 22,183 $ 33,371
Investments 17,494 6,824
Loans:
Held for sale 41,947 43,284
---------------- -------------------
Held for investment 144,143 142,327
Less: Allowance (2,744) (3,379)
---------------- -------------------
Net held for investment 141,399 138,948
---------------- -------------------
Securitized loans 59,095 66,195
Less: Allowance (2,354) (2,571)
---------------- -------------------
Net securitized loans 56,741 63,624
---------------- -------------------
NET LOANS 240,087 245,856
---------------- -------------------
Other assets 16,668 21,159
---------------- -------------------
TOTAL ASSETS $ 296,432 $ 307,210
================ ===================
Deposits $ 215,753 $ 219,083
Bonds payable 44,423 50,473
Other liablities 3,814 5,567
---------------- -------------------
TOTAL LIABILITIES 263,990 275,123
Stockholders' equity 32,442 32,087
---------------- -------------------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY
$ 296,432 $ 307,210
================ ===================
Shares outstanding 5,690,224 5,690,224
Book value per share $ 5.70 $ 5.64
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
Nonaccrual loans $ 12,623 $ 13,965
SBA guaranteed portion (7,014) (8,143)
---------------- -------------------
Nonaccrual loans, net $ 5,609 $ 5,822
================ ===================
COMMUNITY WEST BANCSHARES
CONDENSED CONSOLIDATED INCOME STATEMENT
(unaudited)
(in 000's, except share and per share data)
Quarter Ended March 31
-----------------------
2003 2002
---------- -----------
Interest income $ 5,179 $ 7,538
Interest expense 2,618 3,864
---------- -----------
Net interest income 2,561 3,674
Provision for loan losses 344 2,276
---------- -----------
Net interest income after provision for loan losses
2,217 1,398
Non-interest income 2,669 3,375
Non-interest expenses 4,355 6,409
---------- -----------
Income (loss) before income taxes
531 (1,636)
Provision (benefit) for income taxes
183 (687)
---------- -----------
NET INCOME (LOSS) $ 348 $ (949)
========== ===========
Earnings per share:
Basic $ 0.06 $ (0.17)
Diluted 0.06 (0.17)
Weighted average shares:
Basic 5,690,224 5,690,224
Diluted 5,711,031 5,690,224