1st Enterprise Bank Announces Net Income of $1.39 Million for the 3rd Quarter of 2013

Marketwired

LOS ANGELES, CA--(Marketwired - Oct 18, 2013) - 1st Enterprise Bank ("the Bank") (OTCQB: FENB), an independent full-service commercial bank serving the Southern California business community, reported net income of $1,388,000 for the quarter ending September 30, 2013.

Financial Highlights

  • Total Assets grew by 11%, from $662 million at September 30, 2012 to $731 million at September 30, 2013
  • Total Loans outstanding grew by $83 million or 22%, from $381 million at September 30, 2012 to $464 million at September 30, 2013
  • Total Deposits grew by 6%, from $592 million at September 30, 2012 to $629 million at September 30, 2013
  • Net interest income of $5.5 million was the highest in the Bank's history and 14% higher than the third quarter of 2012
  • Net Income applicable to common shareholders was $1,347,000 for the third quarter of 2013, compared to $608,000 for the third quarter of 2012
  • Income before taxes, loan loss provision and gain on sale of securities was $2,119,000 for the quarter, a 29% increase over the prior year
  • Diluted earnings per common share was $.33 for the quarter, compared to $.15 in the third quarter of 2012

"Our third quarter earnings reflect a significant improvement over last year, and our continuing momentum in terms of both growth and return," said John Black, CEO. "We are very pleased that the Bank's return on common equity exceeded 10% for the second consecutive quarter."

For the three months ended September 30, 2013, net interest income before provision was $5.5 million, an increase of 14% compared to the third quarter of 2012 and an increase of 1% compared to the second quarter of 2013. The year-over-year growth in net interest income was the result of both earning asset and net interest margin growth. Earning assets were $672 million in the third quarter of 2013, an 8% or $51 million increase over the prior year. The net interest margin was 3.23% during the third quarter of 2013, compared to 3.08% for the prior year. This increase resulted from the yield on earning assets increasing from the prior quarter as loan balances grew from 57% of earning assets, to 67%. The 1% increase over the second quarter of 2013 was due to growth in earning assets of $16 million that was offset by a decline in the net interest margin from 3.32% to 3.23%. The decrease in net interest margin was the result of declining loan and investment yields due to the continuation of the current low rate environment. The provision for loan loss was $4,000 for the third quarter of 2013, a $741,000 decrease year over year and a $62,000 sequential decrease. The Bank had net recoveries of $11,000 in the third quarter and $21,000 during the second quarter of 2013. As of September 30, 2013 there were no non-accrual loans.

Non-interest income, excluding gain on sale, was $904,000 for the quarter, which was a $23,000 decrease year over year and a $27,000 sequential increase.

Non-interest expense increased over the prior year and prior quarter by $174,000 and $131,000, respectively. Growth in non-interest expense was generally due to staff additions during the third quarter.

"We are very proud of these results and improving metrics, which are the result of the efforts of our very talented staff," said Brian Horton, President. "We thank our shareholders and customers for their continued support of our vision of being the recognized leader in the field of business banking."

About 1st Enterprise Bank
Founded in 2006, 1st Enterprise Bank is a full service independent commercial banking institution, whose highly experienced bankers personally serve Southern California entrepreneurial businesses, professional firms and nonprofit organizations, along with their owners and key managers. Headquartered in the Los Angeles financial district, with full service regional banking offices in Irvine and Ontario and an LPO in Woodland Hills, 1st Enterprise Bank offers a full range of credit and depository services, with special emphasis on superior customer service, sophisticated cash management services and direct access to bank decision makers. Customers work directly with a dedicated Relationship Manager, a seasoned professional who understands their unique challenges serving as a sounding board and an active participant in their client's success. For more information on 1st Enterprise Bank, please visit www.1stenterprisebank.com.

Forward-Looking Statement:
This news release contains statements that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on current expectations, estimates and projections about 1st Enterprise Bank's business based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including those described above and the following: 1st Enterprise Bank's timely implementation of new products and services, technological changes, changes in consumer spending and savings habits and other risks discussed from time to time in 1st Enterprise Bank's reports and filings with banking regulatory agencies. In addition, such statements could be affected by general industry and market conditions and growth rates, and general domestic and international economic conditions. Such forward-looking statements speak only as of the date on which they are made, and 1st Enterprise Bank does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this release.

                   
                   
1st Enterprise Bank                  
Condensed Statements of Financial Condition          
$000   Unaudited     Unaudited     Unaudited  
Assets   9/30/2013     6/30/2013     9/30/2012  
  Cash and due from banks   $ 25,030     $ 16,786       21,058  
  Interest earning deposits in other banks     11,708       12,036       15,357  
    Total cash and cash equivalents     36,738       28,822       36,415  
                         
  Certificates of deposit in other banks     2,241       2,490       498  
  Investment securities - available-for-sale     144,462       154,689       167,518  
  Investment securities - held-to-maturity     61,274       61,931       56,114  
  Loans, net of deferred loan fees     463,998       444,861       381,307  
  Allowance for loan losses     (5,805 )     (5,790 )     (5,595 )
  Loans, net of allowance for loan losses     458,193       439,071       375,712  
  Bank owned life insurance     16,281       16,148       13,276  
  Premises and equipment, net     2,536       2,647       2,274  
  Accrued interest receivable and other assets     9,612       10,313       10,022  
    Total Assets   $ 731,337     $ 716,111     $ 661,829  
                         
Liabilities                        
  Non-interest-bearing demand deposits   $ 298,662     $ 274,167     $ 273,197  
  Interest bearing transaction accounts     36,841       38,076       43,884  
  Money market and savings accounts     282,465       271,377       264,056  
  Time deposits     11,524       16,879       10,739  
    Total Deposits     629,492       600,499       591,876  
  Federal Home Loan Bank Borrowings     30,000       45,000       -  
  Other liabilities     3,501       3,384       4,913  
    Total Liabilities     662,993       648,883       596,789  
                         
Shareholders' Equity                        
  Serial Preferred Stock     16,380       16,380       16,380  
  Common Stock     43,109       43,068       43,008  
  Retained Earnings     8,634       7,287       3,752  
  Accumulated other comprehensive income     221       494       1,900  
    Total Shareholders' Equity     68,344       67,228       65,040  
                         
Total Liabilities and Shareholders' Equity   $ 731,337     $ 716,111     $ 661,829  
                         
                         
                         
1st Enterprise Bank                  
Condensed Statements of Operations   Three Months Ended  
$000   Unaudited  
    9/30/2013     6/30/2013     9/30/2012  
Interest Income                        
  Interest and fees on loans   $ 4,780     $ 4,724     $ 3,957  
  Interest on investment securities     855       879       986  
  Other interest income     11       7       36  
    Total interest income     5,646       5,610       4,979  
Interest Expense     180       183       179  
Net Interest Income     5,466       5,427       4,800  
                         
Provision for loan losses     4       66       745  
                         
Net Interest Income After Provision for Loan Losses     5,462       5,361       4,055  
                         
Non-interest Income                        
Service charges, fees and other income     904       877       927  
Gain on sale of investment sercurities     (12 )     4       18  
    Total non-interest Income     892       881       945  
                         
Non-interest Expenses                        
  Compensation and benefit expenses     2,584       2,450       2,342  
  Occupancy and equipment expenses     399       405       359  
  Data processing     268       268       278  
  Professional and legal     347       334       417  
  Other operating expenses     654       664       682  
    Total non-interest expense     4,252       4,121       4,078  
                         
Income Before Income Taxes     2,103       2,122       922  
                         
Provision for income taxes     715       712       273  
                         
Net Income   $ 1,388     $ 1,410     $ 649  
                         
Preferred dividends & Warrant amortization     41       41       41  
                         
Net Income Applicable to Common Shareholders   $ 1,347     $ 1,369     $ 608  
                         
Earnings Per Share                        
Basic earnings per share   $ 0.36     $ 0.36     $ 0.16  
                         
Diluted earnings per share   $ 0.33     $ 0.34     $ 0.15  
                         
Average shares outstanding     3,795,218       3,793,339       3,790,359  
                         
Average fully diluted shares     4,123,964       4,082,229       4,002,939  
                         
Total Shares outstanding at end of period     3,822,389       3,815,589       3,814,539  
                         
Capital Ratios                        
Tier 1 leverage ratio     9.6 %     9.6 %     9.6 %
                         
Tier 1 risk-based capital ratio     11.5 %     11.8 %     12.1 %
                         
Total risk-based capital ratio     12.5 %     12.9 %     13.3 %
                         
Book value per share   $ 13.59     $ 13.33     $ 12.76  
                         
Performance Ratios                        
Return on average assets     0.77 %     0.81 %     0.39 %
                         
Return on average common equity     10.37 %     10.51 %     4.97 %
                         
Net interest margin     3.23 %     3.32 %     3.08 %
                         
Cost of Funds     0.11 %     0.12 %     0.12 %
                         
Efficiency ratio     66.3 %     66.0 %     72.4 %
                         
Average Balances                        
Total Assets   $ 713,333     $ 699,387     $ 660,792  
                         
Earning Assets     671,798       655,884       620,656  
                         
Total Loans     448,250       435,824       356,425  
                         
Total Securities     213,618       215,564       210,271  
                         
Total Deposits     623,879       603,104       591,691  
                         
Common Equity     51,540       52,230       48,692  
                         
Contact:

John C. Black
CEO
213-430-7000
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