Community West Bancshares Reports Fourth Quarter 2022 Earnings of $3.4 Million, or $0.38 Per Diluted Share, and Record Net Income of $13.4 Million, or $1.51 Per Diluted Share, for the Year; Increases Quarterly Cash Dividend to $0.08 Per Common Share

Community West Bancshares

GOLETA, Calif., Jan. 27, 2023 (GLOBE NEWSWIRE) -- Community West Bancshares (“Community West” or the “Company”), (NASDAQ: CWBC), parent company of Community West Bank (the “Bank”), today reported net income of $3.4 million, or $0.38 per diluted share, for the fourth quarter of 2022, compared to $3.5 million, or $0.39 per diluted share, for the preceding quarter, and $2.9 million, or $0.33 per diluted share, for the fourth quarter of 2021. For the full year 2022, the Company reported record net income of $13.4 million, or $1.51 per diluted share, compared to $13.1 million, or $1.50 per diluted share, for the full year 2021.

Earnings for the fourth quarter of 2022 include a $461,000 negative provision for loan loss expense compared to a $298,000 provision for loan loss expense during third quarter 2022. Also impacting the preceding quarter was a one-time $132,000 recovery related to a prior OREO expense.

The Company’s Board of Directors declared an increase of its quarterly cash dividend by 6.7% to $0.08 per common share, payable February 28, 2023, to common shareholders of record on February 10, 2023.

“We delivered excellent fourth quarter results, and record full year 2022 earnings, highlighted by strong organic loan growth, steady loan production and continued net interest margin expansion,” stated Martin E. Plourd, President & Chief Executive Officer of Community West Bancshares. “We started the year focused on deploying excess liquidity through increased lending activity, which resulted in solid organic loan growth. Our net interest margin improved 19 basis points on a linked quarter basis to 4.58%, as we benefitted from higher loan yields and interest rate increases enacted by the Federal Reserve. Our outlook for 2023 remains cautious, as we anticipate a leaner loan pipeline, as recessionary concerns continue, and deposit pricing pressures persist. As one of the last remaining community banks of scale along California's Central Coast, we continue to create value for our clients, shareholders, and communities.”

Fourth Quarter 2022 Financial Highlights:

• Net income was $3.4 million, or $0.38 per diluted share in the fourth quarter 2022, compared to $3.5 million, or $0.39 per diluted share in third quarter 2022, and $2.9 million, or $0.33 per diluted share in fourth quarter 2021.

• Net interest income increased to $12.1 million for fourth quarter 2022, compared to $11.9 million in third quarter 2022 and $10.7 million in fourth quarter 2021.

• Net interest margin improved to 4.58% for the fourth quarter 2022, compared to 4.39% in third quarter 2022, and 3.77% in fourth quarter 2021.

• Return on average assets was 1.24% for the fourth quarter 2022, compared to 1.25% in third quarter 2022, and 0.99% in fourth quarter 2021.

• Return on average equity was 11.98% for the fourth quarter 2022, compared to 12.65% in third quarter 2022, and 11.42% in fourth quarter 2021.

• The Company recorded a negative provision for loan loss expense of $461,000 for fourth quarter 2022, compared to a provision for loan losses of $298,000 for third quarter 2022, and a provision of $26,000 for fourth quarter 2021.

• The Allowance for Loan Losses (“ALL”) was 1.15% of total loans held for investment at December 31, 2022, compared to 1.20% at September 30, 2022, and at December 31, 2021.

• Net non-accrual loans improved to $211,000 at December 31, 2022, compared to $239,000 at September 30, 2022, and $565,000 at December 31, 2021.

• Total loans increased by $9.6 million to $955.3 million at December 31, 2022, compared to $945.7 million, at September 30, 2022, and increased $63.3 million compared to $892.1 million, at December 31, 2021.

• Stockholders’ equity increased $2.8 million to $112.7 million at December 31, 2022, compared to $109.8 million at September 30, 2022, and increased $11.3 million compared to $101.4 million at December 31, 2021.

• Non-interest-bearing demand deposits decreased $26.6 million to $216.5 million at December 31, 2022, compared to $243.1 million at September 30, 2022, and increased $6.6 million compared to $209.9 million at December 31, 2021.

• Book value per common share increased to $12.80 at December 31, 2022, compared to $12.54 at September 30, 2022, and $11.72 at December 31, 2021.

• The Bank’s Tier 1 leverage ratio was 10.34% at December 31, 2022, compared to 9.83% at September 30, 2022, and 8.56% at December 31, 2021.
  

Income Statement

Net interest income increased 1.8% to $12.1 million in the fourth quarter 2022, compared to $11.9 million in the preceding quarter and increased 13.3% compared to $10.7 million in fourth quarter 2021. Interest income from loans increased 5.1% or $600,000 compared to the prior quarter due to increased average balances and loan yields. Interest income from securities and interest-earning deposits increased 3.0% or $24,000 compared to the prior quarter primarily due to increased average security balances and higher earning-deposit yields because of increased market rates. Total interest expense for the quarter increased 55.5% or $406,000 compared to the prior quarter due to increased rates on interest-bearing demand deposits. For the year, net interest income increased 8.1% to $45.8 million compared to $42.4 million in 2021. Interest income from loans increased 3.4% or $1.5 million in 2022 compared to the prior year due to increased average balances and loan yields. Interest income from securities and interest-earning deposits increased 159.8% or $1.5 million compared to 2021 largely due to the increase in average security balances and higher earning deposit yields. Total interest expense decreased 10.2% or $376,000 compared to 2021 due to the lower rates paid on interest-bearing deposits accounts and lower average time deposit balances and costs.

Net interest margin was 4.58% for fourth quarter 2022, a 19-basis point increase compared to third quarter 2022, and an 81-basis point increase compared to fourth quarter 2021. “Our fourth quarter net interest margin continued to benefit from higher loan yields, as new loans that carry a higher interest rate are replacing lower rate PPP loans, and existing variable rate loans continue to reprice,” said Richard Pimentel, Chief Financial Officer. The yield on loans for the fourth quarter 2022 increased 18 basis points to 5.21% compared to 5.03% for the third quarter 2022 because of increased loan rates on new originations and the impact of higher market rates. The yield on federal funds and interest-earning deposits increased 130 bps to 3.39% for the fourth quarter 2022 due to increases in rates earned for overnight deposits and rates for money market deposits. The cost of funds for the fourth quarter increased 17 basis points to 0.47%, compared to 0.30% for the preceding quarter due to higher rates paid on deposit accounts and changes in portfolio mix. Net interest margin for the year was 4.21% compared to 4.03% in 2021. The 18-basis point increase was primarily due to increased average balances in investment securities, higher rates paid on interest-bearing deposits and lower rates paid on interest-bearing liabilities. Non-interest income for the fourth quarter 2022 decreased $108,000 to $764,000 compared to $872,000 in third quarter 2022 as a result of lower loan fees and less gain-on-sale of loans. Other loan fees were $246,000 for the fourth quarter 2022 compared to $292,000 in third quarter 2022. Gain on sale of loans was $12,000 in the fourth quarter 2022 compared to $49,000 in the third quarter of 2022 as a result of fewer sales during the quarter. Non-interest income increased 6.0% to $4.0 million in the year 2022 compared to $3.8 million in 2021. The increase was primarily due to a $549,000 BOLI policy payout and a $992,000 recapture of expenses from a lawsuit settlement related to a foreclosed asset during the first quarter of 2022. The increase was partially offset by a $218,000 decrease in gain-on-sale of loans as a result of less loan sales and a $188,000 decrease in loan fees.

Non-interest expense increased $969,000 to $8.6 million in fourth quarter 2022 compared to $7.6 million in the third quarter of 2022 primarily due to an increase in professional services. Professional services increased $583,000 due to costs of implementing Sarbanes Oxley and to support strategic and technology initiatives. Non-interest expense increased $3.3 million to $31.3 million in 2022 compared to $28.0 million in 2021. The increase over the prior year was due to a $1.0 million increase in salaries and benefits due to wage competition and a $1.3 million increase in professional services due to costs related to management’s assertion concerning the effectiveness of the Company’s internal control structure and procedures for financial reporting as required for institutions over $1 billion on total assets and to support strategic and technology initiatives.

Balance Sheet

Total assets were $1.09 billion at December 31, 2022 and at September 30, 2022, and decreased $65.6 million, or 5.7%, compared to $1.16 billion, at December 31, 2021. Total interest-earning deposits in other financial institutions increased $13.8 million to $63.3 million at December 31, 2022, compared to September 30, 2022 and significantly decreased $143.4 million compared to December 31, 2021. Total investment securities were $29.5 million at quarter end, compared to $59.9 million in the prior quarter. Total loans increased by $9.6 million, or 1.0%, to $955.3 million at December 31, 2022, compared to $945.7 million, at September 30, 2022, and increased $63.3 million, or 7.1%, compared to $892.1 million, at December 31, 2021. Total loans, excluding PPP loans, increased $9.7 million during the quarter, and increased $82.8 million compared to December 31, 2021.

Commercial real estate loans outstanding (which include SBA 504, construction and land) were up 13.4% from year-ago levels to $545.3 million at December 31, 2022, and comprise 57.1% of the total loan portfolio. Manufactured housing loans were up 6.2% from year-ago levels to $315.8 million, and represent 33.1% of total loans. Commercial loans (which include agriculture loans) were up 3.5% from year-ago levels to $74.9 million, and represent 7.8% of the total loan portfolio. As of December 31, 2022, the Company had seven PPP loans totaling $1.8 million remaining on its balance sheet from both the first and second rounds of PPP funding. PPP loans of $1.8 million represent less than one percent of total loans at December 31, 2022, unchanged from September 30, 2022 and down from $21.3 million at December 31, 2021.

Total deposits increased $22.9 million, or 2.7%, to $875.1 million at December 31, 2022, compared to $852.2 million at September 30, 2022, and decreased $75.0 million, or 7.9%, compared to $950.1 million at December 31, 2021. Non-interest-bearing demand deposits were $216.5 million at December 31, 2022, a $26.6 million decrease compared to $243.1 million at September 30, 2022, and a $6.6 million increase compared to $209.9 million at December 31, 2021. Higher cost interest-bearing demand deposits decreased $11.3 million to $429.2 million at December 31, 2022, compared to $439.9 million at September 30, 2022, and decreased $109.3 million compared to $537.5 million at December 31, 2021. Certificates of deposit, which include brokered deposits, increased $61.2 million during the quarter to $206.9 million at December 31, 2022, compared to $145.8 million at September 30, 2022, and increased $27.9 million compared to $179.1 million at December 31, 2021.

“The Bank experienced deposit outflows because of planned and unplanned withdrawals as competition for deposits continued to put pressure on pricing, net-interest margin and client retention. With more potential rate sensitivity going forward, we anticipate deposit pricing to be a challenge to future NIM expansion,” said Pimentel.

Stockholders’ equity increased to $112.7 million at December 31, 2022, compared to $109.8 million at September 30, 2022, and $101.4 million at December 31, 2021. Book value per common share increased to $12.80 at December 31, 2022, compared to $12.54 at September 30, 2022, and $11.72 at December 31, 2021.

Credit Quality

“Credit quality metrics remain strong, with a decrease in net-nonaccrual loans compared to a year ago,” said William F. Filippin, Chief Credit Officer. At December 31, 2022, asset quality reflected improvement due to positive loan risk rating migrations during the fourth quarter. Total classified loans and net non-accrual loans decreased year-over-year due to improvements in the loan portfolio and payoffs in these categories. All loans rated “Watch” or worse are monitored monthly and proactive measures are taken when any signs of deterioration to the credit are discovered.

The Company recorded a negative provision for loan loss expense of $461,000 in the fourth quarter 2022, compared to a provision for loan loss expense of $298,000 in third quarter 2022, and a provision expense of 26,000 in fourth quarter 2021. The allowance for loan losses was $10.9 million, or 1.15% of total loans held for investment, at December 31, 2022. Net non-accrual loans, plus net other assets acquired through foreclosure, was $2.5 million at December 31, 2022 and at September 30, 2022, and decreased 20.2% compared to $3.1 million at December 31, 2021.

Net non-accrual loans improved to $211,000 as of December 31, 2022, compared to $239,000 at September 30, 2022, and $565,000 at December 31, 2021. Of the $211,000 of net non-accrual loans at December 31, 2022, $150,000 were single family loans and $61,000 were manufactured housing loans.

There was $2.3 million in other assets acquired through foreclosure as of December 31, 2022, and on September 30, 2022. This compared to $2.5 million at December 31, 2021. The OREO balance relates to one property.

Stock Repurchase Program

On August 27, 2021, the Company announced that its Board of Directors had extended the stock repurchase plan until August 31, 2023. The Company did not repurchase shares during the fourth quarter of 2022, leaving $1.4 million available under the previously announced repurchase program.

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, the largest publicly traded community bank serving California’s Central Coast area of Ventura, Santa Barbara and San Luis Obispo counties. Community West Bank has seven full-service California branch banking offices in Goleta, Santa Barbara, Santa Maria, Ventura, San Luis Obispo, Oxnard and Paso Robles. The principal business activities of the Company are Relationship Banking, Manufactured Housing lending and Government Guaranteed lending.

Industry Accolades

In May of 2022, Community West was ranked #125 on the American Banker Magazine’s list of Top 200 Publicly Traded Community Banks and Thrifts based on three-year average return on equity as of December 31, 2021.

Community West Bank was awarded a “Super Premier Performance” rating by The Findley Reports. For 52 years, The Findley Reports has been recognizing the financial performance of banking institutions in California and the Western United States. Community West Bank is rated 5-star Superior by Bauer Financial.

Safe Harbor Disclosure

This release contains certain forward-looking statements about the Company and the Bank that are intended to be covered by the safe harbor for “forward-looking statements” provided by the Private Securities Litigation Reform Act of 1995. Statements that are not historical or current facts, including statements about future financial and operational results, expectations, or intentions are forward-looking statements. Such statements 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 and are subject to significant risks, contingencies, and uncertainties, many of which are difficult to predict and are generally beyond our control including, but not limited to, risks from the COVID-19 pandemic, the strength of the United States economy in general and of the local economies in which we conduct operations, the effect of, and changes in, trade, monetary and fiscal policies and laws, including changes in interest rate policies of the Board of Governors of the Federal Reserve System, inflation, weather, natural disasters, climate change, increased unemployment, deterioration in credit quality of our loan portfolio and/or the value of the collateral securing the repayment of those loans, reduction in the value of our investment securities, the costs and effects of litigation and of adverse outcomes of such litigation, the cost and ability to attract and retain key employees, a breach of our operational or security systems, policies or procedures including cyber-attacks on us or third party vendors or service providers, regulatory or legal developments, United States tax policies, including our effective income tax rate, and our ability to implement and execute our business plan and strategy and expand our operations as provided therein. Actual results may differ materially from those set forth or implied in the forward-looking statements as a result of a variety of factors including the risk factors contained in documents filed by the Company with the Securities and Exchange Commission and are available in the “Investor Relations” section of our website, https://www.communitywest.com/sec-filings/documents/default.aspx. The Company is under no obligation (and expressly disclaims any obligation) to update or alter such forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law.

COMMUNITY WEST BANCSHARES
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
(in 000's, except per share data)
		December 31,				September 30,				December 31,
			2022				2022				2021
Cash and cash equivalents		$	1,379			$	1,806			$	1,621
Interest-earning deposits in other financial institutions			63,311				49,489				206,754
Investment securities			29,470				59,909				22,773
Loans:
Commercial			74,929				70,811				72,423
Commercial real estate			545,317				544,373				480,801
SBA			6,855				6,955				8,580
Paycheck Protection Program (PPP)			1,773				1,810				21,317
Manufactured housing			315,825				309,989				297,363
Single family real estate			8,678				8,943				8,663
HELOC			2,613				3,373				3,579
Other (1)			(648	)			(560	)			(643	)
Total loans			955,342				945,694				892,083
Loans, net
Held for sale			21,033				22,096				23,408
Held for investment			934,309				923,598				868,675
Less: Allowance for loan losses			(10,765	)			(11,113	)			(10,404	)
Net held for investment			923,544				912,485				858,271
NET LOANS			944,577				934,581				881,679
Other assets			52,765				42,493				44,225
TOTAL ASSETS		$	1,091,502			$	1,088,278			$	1,157,052
Deposits
Non-interest-bearing demand		$	216,494			$	243,100			$	209,893
Interest-bearing demand			428,173				439,455				537,508
Savings			23,490				23,865				23,675
Certificates of deposit ($250,000 or more)			6,693				9,909				17,612
Other certificates of deposit			200,234				135,860				161,443
Total deposits			875,084				852,189				950,131
Other borrowings			90,000				110,000				90,000
Other liabilities			13,768				16,268				15,546
TOTAL LIABILITIES			978,852				978,457				1,055,677
Stockholders' equity			112,650				109,821				101,375
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
		$	1,091,502			$	1,088,278			$	1,157,052
Common shares outstanding			8,798				8,755				8,650
Book value per common share		$	12.80			$	12.54			$	11.72
(1) Includes consumer, other loans, securitized loans, and deferred fees

COMMUNITY WEST BANCSHARES
CONDENSED CONSOLIDATED INCOME STATEMENTS
(unaudited)
(in 000's, except per share data)
		Three Months Ended								Twelve Months Ended
		December 31,				December 31,				December 31,				December 31,
			2022				2021				2022				2021
Interest income
Loans, including fees		$	12,467			$	11,258			$	46,657			$	45,123
Investment securities and other			811				279				2,481				955
Total interest income			13,278				11,537				49,138				46,078
Deposits			913				614				2,511				2,835
Other borrowings			224				206				817				869
Total interest expense			1,137				820				3,328				3,704
Net interest income			12,141				10,717				45,810				42,374
Provision (credit) for loan losses			(461	)			26				(195	)			(181	)
Net interest income after provision (credit) for loan losses			12,602				10,691				46,005				42,555
Non-interest income
Other loan fees			246				343				1,161				1,349
Gains from loan sales, net			12				109				257				475
Document processing fees			85				123				422				512
Service charges			143				84				438				302
Other			278				285				1,700				1,115
Total non-interest income			764				944				3,978				3,753
Non-interest expenses
Salaries and employee benefits			4,821				4,884				19,348				18,306
Occupancy, net			1,116				893				4,180				3,254
Professional services			1,236				441				2,923				1,645
Data processing			346				251				1,265				1,215
Depreciation			176				186				711				780
FDIC assessment			111				146				577				485
Advertising and marketing			234				198				921				734
Stock-based compensation			32				129				289				318
Other			507				478				1,058				1,258
Total non-interest expenses			8,579				7,606				31,272				27,995
Income before provision for income taxes			4,787				4,029				18,711				18,313
Provision for income taxes			1,411				1,135				5,262				5,212
Net income		$	3,376			$	2,894			$	13,449			$	13,101
Earnings per share:
Basic		$	0.38			$	0.34			$	1.54			$	1.53
Diluted		$	0.38			$	0.33			$	1.51			$	1.50

COMMUNITY WEST BANCSHARES
CONDENSED CONSOLIDATED INCOME STATEMENTS
(unaudited)
(in 000's, except per share data)
		Three Months Ended
		December 31,				September 30,				June 30,				March 31,				December 31,
			2022				2022				2022				2022				2021
Interest income
Loans, including fees		$	12,467			$	11,867			$	11,129			$	11,194			$	11,258
Investment securities and other			811				787				577				306				279
Total interest income			13,278				12,654				11,706				11,500				11,537
Deposits			913				528				500				570				614
Other borrowings			224				203				196				194				206
Total interest expense			1,137				731				696				764				820
Net interest income			12,141				11,923				11,010				10,736				10,717
Provision (credit) for loan losses			(461	)			298				252				(284	)			26
Net interest income after provision (credit) for loan losses			12,602				11,625				10,758				11,020				10,691
Non-interest income
Other loan fees			246				292				377				246				343
Gains from loan sales, net			12				49				136				60				109
Document processing fees			85				114				122				101				123
Service charges			143				114				93				88				84
Other			278				303				323				796				285
Total non-interest income			764				872				1,051				1,291				944
Non-interest expenses
Salaries and employee benefits			4,821				4,752				4,910				4,865				4,884
Occupancy, net			1,116				1,046				1,021				997				893
Professional services			1,236				653				635				399				441
Data processing			346				302				307				310				251
Depreciation			176				173				179				183				186
FDIC assessment			111				131				164				171				146
Advertising and marketing			234				196				233				258				198
Stock-based compensation			32				71				94				92				129
Other			507				286				569				(304	)			478
Total non-interest expenses			8,579				7,610				8,112				6,971				7,606
Income before provision for income taxes			4,787				4,887				3,697				5,340				4,029
Provision for income taxes			1,411				1,409				1,062				1,380				1,135
Net income		$	3,376			$	3,478			$	2,635			$	3,960			$	2,894
Earnings per share:
Basic		$	0.38			$	0.40			$	0.30			$	0.46			$	0.34
Diluted		$	0.38			$	0.39			$	0.30			$	0.45			$	0.33

		Three Months Ended									Three Months Ended									Three Months Ended
		December 31, 2022									September 30, 2022									December 31, 2021
		Average Balance			Interest			Average Yield/Cost			Average Balance			Interest			Average Yield/Cost			Average Balance			Interest			Average Yield/Cost
Interest-Earning Assets
Federal funds sold and interest-earning deposits		$	48,512		$	415		3.39	%		$	76,265		$	401		2.09	%		$	210,293		$	85		0.16	%
Investment securities			54,022			396		2.91	%			65,148			386		2.35	%			27,661			194		2.78	%
Loans (1)			949,007			12,467		5.21	%			935,169			11,867		5.03	%			888,519			11,258		5.03	%
Total earnings assets			1,051,541			13,278		5.01	%			1,076,582			12,654		4.66	%			1,126,473			11,537		4.06	%
Nonearning Assets
Cash and due from banks			2,145									2,177									2,154
Allowance for loan losses			(11,204	)								(11,031	)								(10,314	)
Other assets			36,432									38,022									39,596
Total assets		$	1,078,914								$	1,105,750								$	1,157,909
Interest-Bearing Liabilities
Interest-bearing demand deposits		$	442,313		$	591		0.53	%		$	465,317		$	325		0.28	%		$	523,212		$	343		0.26	%
Savings deposits			22,801			13		0.23	%			25,133			14		0.22	%			22,248			18		0.32	%
Time deposits			152,249			309		0.81	%			151,130			189		0.50	%			181,638			253		0.55	%
Total interest-bearing deposits			617,363			913		0.59	%			641,580			528		0.33	%			727,098			614		0.34	%
Other borrowings			92,391			224		0.96	%			90,764			203		0.89	%			90,003			206		0.91	%
Total interest-bearing liabilities		$	709,754		$	1,137		0.64	%		$	732,344		$	731		0.40	%		$	817,101		$	820		0.40	%
Noninterest-Bearing Liabilities
Noninterest-bearing demand deposits			241,759									248,538									223,503
Other liabilities			15,555									15,789									16,726
Stockholders' equity			111,846									109,079									100,579
Total Liabilities and Stockholders' Equity		$	1,078,914								$	1,105,750									1,157,909
Net interest income and margin					$	12,141		4.58	%					$	11,923		4.39	%					$	10,717		3.77	%
Net interest spread								4.37	%								4.26	%								3.66	%
Cost of total deposits								0.42	%								0.24	%								0.26	%
Cost of funds								0.47	%								0.30	%								0.31	%

		Twelve Months Ended									Twelve Months Ended
		December 31, 2022									December 31, 2021
		Average Balance			Interest			Average Yield/Cost			Average Balance			Interest			Average Yield/Cost
Interest-Earning Assets
Federal funds sold and interest-earning deposits		$	119,524		$	1,226		1.03	%		$	139,217		$	230		0.17	%
Investment securities			47,949			1,255		2.62	%			27,011			725		2.68	%
Loans (1)			921,638			46,657		5.06	%			884,601			45,123		5.10	%
Total earnings assets			1,089,111			49,138		4.51	%			1,050,829			46,078		4.38	%
Nonearning Assets
Cash and due from banks			2,169									2,149
Allowance for loan losses			(10,906	)								(10,245	)
Other assets			37,751									39,827
Total assets		$	1,118,125								$	1,082,560
Interest-Bearing Liabilities
Interest-bearing demand deposits		$	480,472		$	1,508		0.31	%		$	467,720		$	1,702		0.36	%
Savings deposits			24,317			60		0.25	%			20,749			76		0.37	%
Time deposits			160,788			943		0.59	%			182,108			1,057		0.58	%
Total interest-bearing deposits			665,577			2,511		0.38	%			670,577			2,835		0.42	%
Other borrowings			90,795			817		0.90	%			94,343			869		0.92	%
Total interest-bearing liabilities		$	756,372		$	3,328		0.44	%		$	764,920		$	3,704		0.48	%
Noninterest-Bearing Liabilities
Noninterest-bearing demand deposits			237,849									205,820
Other liabilities			16,151									16,050
Stockholders' equity			107,753									95,770
Total Liabilities and Stockholders' Equity		$	1,118,125								$	1,082,560
Net interest income and margin					$	45,810		4.21	%					$	42,374		4.03	%
Net interest spread								4.07	%								3.90	%
Cost of total deposits								0.28	%								0.32	%
Cost of funds								0.33	%								0.38	%

ADDITIONAL FINANCIAL INFORMATION
(Dollars and shares in thousands except per share amounts)(Unaudited)
	Three Months Ended				Three Months Ended				Three Months Ended				Twelve Months Ended				Twelve Months Ended
PERFORMANCE MEASURES AND RATIOS	December 31, 2022				September       30, 2022				December 31, 2021				December 31, 2022				December 31, 2021
Return on average common equity		11.98	%			12.65	%			11.42	%			12.48	%			13.68	%
Return on average assets		1.24	%			1.25	%			0.99	%			1.20	%			1.21	%
Efficiency ratio		66.48	%			59.48	%			65.23	%			62.81	%			60.69	%
Net interest margin		4.58	%			4.39	%			3.77	%			4.21	%			4.03	%
	Three Months Ended				Three Months Ended				Three Months Ended				Twelve Months Ended				Twelve Months Ended
AVERAGE BALANCES	December 31, 2022				September       30, 2022				December 31, 2021				December 31, 2022				December 31, 2021
Average assets	$	1,078,914			$	1,105,750			$	1,157,909			$	1,118,125			$	1,082,560
Average earning assets		1,051,541				1,076,582				1,126,473				1,089,111				1,050,829
Average total loans		949,007				935,169				888,519				921,638				884,601
Average deposits		859,122				890,118				950,601				903,426				876,397
Average common equity		111,846				109,079				100,579				107,753				95,770
EQUITY ANALYSIS	December 31, 2022				September    30, 2022				December 31, 2021
Total common equity	$	112,650			$	109,821			$	101,375
Common stock outstanding		8,798				8,755				8,650
Book value per common share	$	12.80			$	12.54			$	11.72
ASSET QUALITY	December 31, 2022				September 30, 2022				December 31, 2021
Nonaccrual loans, net	$	211			$	239			$	565
Nonaccrual loans, net/total loans		0.02	%			0.03	%			0.06	%
Other assets acquired through foreclosure, net	$	2,250			$	2,250			$	2,518
Nonaccrual loans plus other assets acquired through foreclosure, net	$	2,461			$	2,489			$	3,083
Nonaccrual loans plus other assets acquired through foreclosure, net/total assets		0.23	%			0.23	%			0.27	%
Net loan (recoveries)/charge-offs in the quarter	$	(113	)		$	51			$	(96	)
Net (recoveries)/charge-offs in the quarter/total loans		(0.01	%)			0.01	%			(0.01	%)
Allowance for loan losses	$	10,765			$	11,113			$	10,404
Plus: Reserve for undisbursed loan commitments		94				96				94
Total allowance for credit losses	$	10,859			$	11,209			$	10,498
Allowance for loan losses/total loans held for investment		1.15	%			1.20	%			1.20	%
Allowance for loan losses/total loans held for investment excluding PPP loans		1.15	%			1.21	%			1.23	%
Allowance for loan losses/nonaccrual loans, net		5101.90	%			4649.79	%			1842.50	%
Community West Bank *
Tier 1 leverage ratio		10.34	%			9.83	%			8.56	%
Tier 1 capital ratio		11.44	%			11.30	%			11.02	%
Total capital ratio		12.56	%			12.46	%			12.19	%
INTEREST SPREAD ANALYSIS	December 31, 2022				September 30, 2022				December 31, 2021
Yield on total loans		5.21	%			5.03	%			5.03	%
Yield on investments		2.91	%			2.35	%			2.78	%
Yield on interest earning deposits		3.39	%			2.09	%			0.16	%
Yield on earning assets		5.01	%			4.66	%			4.06	%
Cost of interest-bearing deposits		0.59	%			0.33	%			0.34	%
Cost of total deposits		0.42	%			0.24	%			0.26	%
Cost of borrowings		0.96	%			0.89	%			0.91	%
Cost of interest-bearing liabilities		0.64	%			0.40	%			0.40	%
Cost of funds		0.47	%			0.30	%			0.31	%
* Capital ratios are preliminary until the Call Report is filed.

Contact:

Richard Pimentel, EVP & CFO
805.692.4410
www.communitywestbank.com