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Cornerstone Community Bancorp Reports Financial Results for the Fourth Quarter and Full Year Ended December 31, 2019

 

Cornerstone Community Bancorp (OTC Pink: CRSB) announced today its financial results for the fourth quarter ended December 31, 2019.

The Company reported net income of $884,000 for the three months ended December 31, 2019 compared to net income of $884,000 for the same period last year. Diluted earnings per share were $0.58 for the three months ended December 31, 2019 compared to $0.57 for the same period last year.

The return on average assets for the three months ended December 31, 2019 was 1.16% and the return on average equity was 13.87%. The net interest margin was 4.03% for the three months ended December 31, 2019 compared to 4.26% for the same period last year and the efficiency ratio declined to 58.78% for the three months ended December 31, 2019 compared to 60.76% for the same period last year.

For the year ended December 31, 2019, the Company reported net income of $3,452,000 compared to net income of $2,776,000 for the same period last year. Diluted earnings per share were $2.27 for the year ended December 31, 2019 compared to $1.84 for the same period last year.

The return on average assets for the year ended December 31, 2019 was 1.22% and the return on average equity was 14.33%.

President and CEO, Jeff Finck, stated, "The Company experienced solid loan, deposit and earnings growth in 2019. As we begin the new decade, we look forward to continuing to deliver outstanding service to our customers and moving local dreams forward."

Net Interest Income

Net interest income increased to $2,834,000 for the quarter ended December 31, 2019 compared to $2,599,000 for the same quarter last year. For the year ended December 31, 2019, net interest income increased to $10,971,000 compared to $9,660,000 for the same period last year.

Provision for credit losses

The Company recorded a $100,000 provision for credit losses for the quarter ended December 31, 2019 compared to $130,000 for the same quarter last year. For the year ended December 31, 2019, the Company recorded a $340,000 provision for credit losses compared to $309,000 for the same period last year.

Non-Interest Income

Non-interest income for the quarter ended December 31, 2019 was $201,000 compared to $161,000 for the quarter ended December 31, 2018. For the year ended December 31, 2019, non-interest income was $1,206,000 compared to $695,000 for the same period last year.

Non-Interest Expense

Non-interest expense was $1,784,000 for the quarter ended December 31, 2019 compared to $1,677,000 for the same period last year. For the year ended December 31, 2019, non-interest expense was $7,071,000 compared to $6,459,000 for the same period last year.

Income Taxes

Fourth quarter 2018 income tax expense was impacted by tax benefits from the exercise of stock options.

Balance Sheet

The Company had total assets at December 31, 2019 of $288.4 million compared to $266.4 million at December 31, 2018.

Total loans, net of unearned income at December 31, 2019 were $241.7 million compared to $209.3 million at December 31, 2018.

Total deposits were $253.4 million at December 31, 2019 compared to total deposits of $232.3 million at December 31, 2018.

Credit Quality

The allowance for loan losses was $2,409,000, or 1.00% of loans, net of unearned income at December 31, 2019, compared to $2,152,000, or 1.03% of loans, net of unearned income at December 31, 2018. There were no nonperforming assets at December 31, 2019 and December 31, 2018.

Capital

At December 31, 2019, shareholders’ equity totaled $25.8 million compared to $22.1 million at December 31, 2018. Book value per share was $17.79 per share at December 31, 2019 compared to $15.56 per share at December 31, 2018. During the second quarter of 2018, the Company completed a private placement of $2.1 million of its common stock. In the offering, the Company issued 119,285 shares of its common stock at a purchase price of $17.5 per share.

About Cornerstone Community Bancorp

Cornerstone Community Bancorp, a bank holding company headquartered in Red Bluff, California, serves the Red Bluff and Redding communities through its wholly-owned subsidiary, Cornerstone Community Bank with a headquarters office in Red Bluff and two banking offices in Redding. The Bank provides commercial banking services to small and mid-size businesses, including professional service firms, real estate developers and investors and not-for-profit organizations and to their owners and other individuals. Additional information about the Bank is available on its website at www.bankcornerstone.com

Forward-Looking Statements

This press release contains forward-looking statements. These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of the management of Cornerstone Community Bancorp and on information available to management at the time these statements were made. There are a number of factors, many of which are beyond Cornerstone Community Bancorp’s control, which could cause actual conditions, events or results to differ significantly from those described in the forward-looking statements. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, among others, the following possibilities: (1) competitive pressures among depository and other financial institutions may increase significantly; (2) revenues may be lower than expected; (3) changes in the interest rate environment may reduce interest margins; (4) general economic conditions, either nationally or regionally, may be less favorable than expected, resulting in, among other things, a deterioration in credit quality and/or a reduced demand for credit; (5) legislative or regulatory changes, including changes in accounting standards and tax laws, may adversely affect the businesses in which Cornerstone Community Bancorp is engaged; (6) competitors may have greater financial resources and develop products that enable such competitors to compete more successfully than Cornerstone Community Bancorp; and (7) adverse changes may occur in the securities markets or with respect to inflation. Forward-looking statements speak only as of the date they are made. Except as required by law, Cornerstone Community Bancorp does not undertake to update forward-looking statements to reflect subsequent circumstances or events.

CORNERSTONE COMMUNITY BANCORP
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(Dollars in Thousands)
      
 12/31/19 09/30/19 06/30/19 03/31/19 12/31/18
      
ASSETS       
Cash and due from banks  

$

6,038

 

 

$

9,271

 

 

$

11,122

 

 

$

5,744

 

 

$

7,002

 

Federal funds sold  

 

4,575

 

 

 

21,117

 

 

 

13,520

 

 

 

8,836

 

 

 

20

 

Interest-bearing deposits  

 

2,825

 

 

 

15,779

 

 

 

8,166

 

 

 

11,186

 

 

 

24,730

 

Investment securities  

 

13,355

 

 

 

5,577

 

 

 

7,010

 

 

 

7,720

 

 

 

9,284

 

Loans held for sale  

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Loans, net of unearned income  

 

241,662

 

 

 

233,342

 

 

 

222,199

 

 

 

214,476

 

 

 

209,330

 

Allowance for loan losses  

 

(2,409

)

 

 

(2,317

)

 

 

(2,345

)

 

 

(2,235

)

 

 

(2,152

)

Loans, net  

 

239,253

 

 

 

231,025

 

 

 

219,854

 

 

 

212,241

 

 

 

207,178

 

Premises and equipment, net  

 

11,216

 

 

 

11,297

 

 

 

11,316

 

 

 

10,154

 

 

 

8,740

 

Other assets  

 

11,093

 

 

 

10,428

 

 

 

18,359

 

 

 

10,151

 

 

 

9,407

 

Total assets  

$

288,355

 

 

$

304,494

 

 

$

289,347

 

 

$

266,032

 

 

$

266,361

 

      
LIABILITIES       
Deposits:       
Demand noninterest-bearing  

$

52,352

 

 

$

59,432

 

 

$

54,439

 

 

$

50,564

 

 

$

50,862

 

Demand interest-bearing  

 

52,058

 

 

 

52,024

 

 

 

48,839

 

 

 

38,434

 

 

 

37,875

 

Money market and savings  

 

74,560

 

 

 

81,926

 

 

 

79,614

 

 

 

74,628

 

 

 

75,015

 

Time deposits of less than $100,000  

 

18,395

 

 

 

18,957

 

 

 

19,331

 

 

 

15,099

 

 

 

15,778

 

Time deposits of $100,000 or more  

 

56,016

 

 

 

57,854

 

 

 

53,940

 

 

 

52,250

 

 

 

52,763

 

Total deposits  

 

253,381

 

 

 

270,193

 

 

 

256,163

 

 

 

230,975

 

 

 

232,293

 

Federal Home Loan Bank borrowings  

 

3,000

 

 

 

3,000

 

 

 

3,000

 

 

 

6,000

 

 

 

6,000

 

Subordinated debentures  

 

4,914

 

 

 

4,911

 

 

 

4,908

 

 

 

4,906

 

 

 

4,903

 

Interest payable and other liabilities  

 

1,235

 

 

 

1,543

 

 

 

1,325

 

 

 

1,190

 

 

 

1,100

 

Total liabilities  

 

262,530

 

 

 

279,647

 

 

 

265,396

 

 

 

243,071

 

 

 

244,296

 

      
SHAREHOLDERS' EQUITY       
Common stock  

 

15,264

 

 

 

15,146

 

 

 

15,122

 

 

 

15,088

 

 

 

15,001

 

Retained Earnings  

 

10,510

 

 

 

9,626

 

 

 

8,753

 

 

 

7,842

 

 

 

7,058

 

Accumulated other comprehensive income (loss)  

 

51

 

 

 

75

 

 

 

76

 

 

 

31

 

 

 

6

 

Total shareholders' equity  

 

25,825

 

 

 

24,847

 

 

 

23,951

 

 

 

22,961

 

 

 

22,065

 

Total liabilities and shareholders' equity  

$

288,355

 

 

$

304,494

 

 

$

289,347

 

 

$

266,032

 

 

$

266,361

 

      
Total equity / total assets  

 

8.96

%

 

 

8.16

%

 

 

8.28

%

 

 

8.63

%

 

 

8.28

%

Book value per share  

$

17.79

 

 

$

17.34

 

 

$

16.71

 

 

$

16.02

 

 

$

15.56

 

Shares outstanding  

 

1,452,041

 

 

 

1,433,041

 

 

 

1,433,041

 

 

 

1,433,041

 

 

 

1,418,041

 

CORNERSTONE COMMUNITY BANCORP
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(Dollars in Thousands)
     
 Three months endedYear ended
 12/31/19 09/30/19 12/31/1812/31/19 12/31/18
     
INTEREST INCOME      
Loans  

$

 

3,349

 

 

$

 

3,376

 

 

$

 

2,966

 

$

 

13,065

 

 

$

 

10,988

 

Federal funds sold  

 

40

 

 

 

61

 

 

 

-

 

 

175

 

 

 

-

 

Investment securities  

 

65

 

 

 

55

 

 

 

70

 

 

238

 

 

 

299

 

Other  

 

130

 

 

 

113

 

 

 

198

 

 

444

 

 

 

565

 

Total interest income  

 

3,584

 

 

 

3,605

 

 

 

3,234

 

 

13,922

 

 

 

11,852

 

     
INTEREST EXPENSE      
Deposits:      
Interest-bearing demand  

 

50

 

 

 

40

 

 

 

22

 

 

139

 

 

 

70

 

Money market and savings  

 

241

 

 

 

243

 

 

 

177

 

 

906

 

 

 

614

 

Time deposits  

 

351

 

 

 

397

 

 

 

317

 

 

1,465

 

 

 

1,026

 

Other  

 

108

 

 

 

108

 

 

 

119

 

 

441

 

 

 

482

 

Total interest expense  

 

750

 

 

 

788

 

 

 

635

 

 

2,951

 

 

 

2,192

 

     
Net interest income  

 

2,834

 

 

 

2,817

 

 

 

2,599

 

 

10,971

 

 

 

9,660

 

Provision for credit losses  

 

100

 

 

 

40

 

 

 

130

 

 

340

 

 

 

309

 

Net interest income after provision for credit losses  

 

2,734

 

 

 

2,777

 

 

 

2,469

 

 

10,631

 

 

 

9,351

 

     
NON-INTEREST INCOME      
Service charges on deposit accounts  

 

61

 

 

 

64

 

 

 

59

 

 

255

 

 

 

223

 

Gain on sale of loans  

 

-

 

 

 

-

 

 

 

-

 

 

417

 

 

 

74

 

Gain (loss) on sale of other real estate owned  

 

-

 

 

 

-

 

 

 

-

 

 

-

 

 

 

-

 

Gain (loss) on sale of securities  

 

-

 

 

 

-

 

 

 

-

 

 

-

 

 

 

-

 

Other non-interest income  

 

140

 

 

 

140

 

 

 

102

 

 

534

 

 

 

398

 

Total non-interest income  

 

201

 

 

 

204

 

 

 

161

 

 

1,206

 

 

 

695

 

     
OPERATING EXPENSES      
Salaries and benefits  

 

887

 

 

 

907

 

 

 

887

 

 

3,636

 

 

 

3,442

 

Premises and fixed assets  

 

239

 

 

 

228

 

 

 

173

 

 

859

 

 

 

627

 

Other  

 

658

 

 

 

621

 

 

 

617

 

 

2,576

 

 

 

2,390

 

Total operating expenses  

 

1,784

 

 

 

1,756

 

 

 

1,677

 

 

7,071

 

 

 

6,459

 

     
Income before income taxes  

 

1,151

 

 

 

1,225

 

 

 

953

 

 

4,766

 

 

 

3,587

 

Income taxes  

 

267

 

 

 

353

 

 

 

69

 

 

1,314

 

 

 

811

 

     
NET INCOME  

$

 

884

 

 

$

 

872

 

 

$

 

884

 

$

 

3,452

 

 

$

 

2,776

 

     
EARNINGS PER SHARE      
Basic earnings per share  

$

 

0.61

 

 

$

 

0.61

 

 

$

 

0.63

 

$

 

2.41

 

 

$

 

2.03

 

Diluted earnings per share  

$

 

0.58

 

 

$

 

0.57

 

 

$

 

0.57

 

$

 

2.27

 

 

$

 

1.84

 

Average common shares outstanding  

 

1,442,639

 

 

 

1,433,041

 

 

 

1,407,785

 

 

1,435,255

 

 

 

1,365,944

 

Average common and equivalent shares outstanding  

 

1,527,238

 

 

 

1,519,531

 

 

 

1,541,133

 

 

1,521,093

 

 

 

1,508,684

 

     
PERFORMANCE MEASURES      
Return on average assets  

 

1.16

%

 

 

1.18

%

 

 

1.36

%

 

1.22

%

 

 

1.13

%

Return on average equity  

 

13.87

%

 

 

14.18

%

 

 

15.99

%

 

14.33

%

 

 

13.51

%

Net interest margin  

 

4.03

%

 

 

4.15

%

 

 

4.26

%

 

4.21

%

 

 

4.18

%

Efficiency ratio  

 

58.78

%

 

 

58.13

%

 

 

60.76

%

 

58.07

%

 

 

62.38

%

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20200129005834/en/

Contacts

Jeffrey P. Finck
President & CEO
530.222.1460

Patrick E. Phelan
Chief Financial Officer
530.222.1460