CommerceWest Bank Reports Fourth-Quarter 2016 39% Increase in EPS and 37% Increase in Net Income

IRVINE, Calif., Jan. 24, 2017 /PRNewswire/ -- CommerceWest Bank (OTCBB: CWBK) reported net income for the three months ended December 31, 2016 of $1,319,000 or $0.32 per common share, compared with net income of $962,000 or $0.23 per common share for the three months ended December 31, 2015, an EPS increase of 39%.  Net income for the twelve months ended December 31, 2016 was $4,830,000 or $1.16 per common share, compared with net income of $4,111,000 or $0.98 per common share for the twelve months ended December 31, 2015, an EPS increase of 18%.     

Key Financial Results for the three months ended December 31, 2016:

• Diluted earnings per share growth of 39%
• Net income of $1.3 million, up 37%
• Return on Assets of 1.07%, up 32%
• Return on Equity of 8.49%, up 31%
• Interest income of $5.1 million, up 10%
• Net interest income of $4.8 million, up 11%
• Non-interest expenses down 9%
• Efficiency ratio of 59.91%
• 28 quarters of consecutive profits

Key Financial Results for the twelve months ended December 31, 2016:

• Diluted earnings per share growth of 18%
• Net income of $4.8 million, up 17%
• Return on Assets of 1.03%, up 10%
• Return on Equity of 7.87%, up 9%
• Interest income of $19.1 million, up 10%
• Net interest income of $18.0 million, up 11%
• Total loan growth of $44.7 million, up 14%
• Strong capital ratios with total risk-based capital ratio of 15.12%
• Zero non-performing loans

"Our performance in 2016 demonstrates that our strategic plan positions us well to perform in all operating environments and that we were able to execute our priorities, resulting in ROA growth of 10% and ROE growth of 9% for the year.  Interest income increased 10% while expenses decreased by 4% for the year ensuing in 17% net income and 18% diluted EPS growth, which is quite an achievement," stated Mr. Ivo Tjan, Chairman and Chief Executive Officer. "I am confident that 2017 will be another stellar year in which we will continue our financial performance trajectory and expand relationships with our clients and the Southern California business community." 

Total assets increased $87.9 million as of December 31, 2016, an increase of 17% as compared to the same period one year ago. Total loans increased $44.7 million as of December 31, 2016, an increase of 14% over the prior year. Cash and due from banks increased $38.7 million or 26% from the prior year. Total investment securities increased $4.7 million from the prior year, an increase of 13% from the prior year.

Total deposits increased $85.1 million as of December 31, 2016, an increase of 18% from December 31, 2015. Non-interest bearing deposits decreased $3.6 million as of December 31, 2016, a decrease of 1% over the prior year. Interest bearing deposits increased $88.8 million as of December 31, 2016, an increase of 42% over the prior period. 

Stockholders' equity on December 31, 2016 was $61.2 million, an increase of 4% as compared to stockholders' equity of $59.0 million a year ago.

Interest income was $5,070,000 for the three months ended December 31, 2016 as compared to $4,592,000 for the three months ended December 31, 2015, an increase of 10%. Interest income was $19,139,000 for the twelve months ended December 31, 2016 as compared to $17,397,000 for the twelve months ended December 31, 2015, an increase of 10%. Interest expense was $294,000 for the three months ended December 31, 2016 as compared to $283,000 for the three months ended December 31, 2015, an increase of 4%. Interest expense was $1,124,000 for the twelve months ended December 31, 2016 as compared to $1,166,000 for the twelve months ended December 31, 2015, a decrease of 4%.

Net interest income for the three months ended December 31, 2016 was $4,776,000 as compared to $4,309,000 for the three months ended December 31, 2015, an increase of 11%. The net interest margin increased for the three months ended December 31, 2016. It increased from 4.01% in 2015 to 4.08% in 2016, an increase of 2%. Net interest income for the twelve months ended December 31, 2016 was $18,015,000 as compared to $16,231,000 for the twelve months ended December 31, 2015, an increase of 11%. The net interest margin decreased for the twelve months ended December 31, 2016. It decreased from 4.19% in 2015 to 4.14% in 2016, a decrease of 1%. 

Provision for loan losses for the three months ended December 31, 2016 was $50,000 compared to $75,000 for the three months ended December 31, 2015, a decrease of 33%. Provision for loan losses for the twelve months ended December 31, 2016 was $225,000 as compared to $391,000 for the twelve months ended December 31, 2015, a decrease of 42%. As of December 31, 2016, the Bank had no non-accrual loans and no OREO. The non-performing asset to total asset ratio was zero at the end of the quarter.

Other income for the three months ended December 31, 2016 was $570,000 compared to $817,000 for the same period last year, a decrease of 30%. Other income for the twelve months ended December 31, 2016 was $2,333,000 compared to $3,431,000 for the same period last year, a decrease of 32%. 

Non-interest expense for the three months ended December 31, 2016 was $3,218,000 compared to $3,524,000 for the same period last year, a decrease of 9%. Non-interest expense for the twelve months ended December 31, 2016 was $12,360,000 compared to $12,836,000 for the same period last year, a decrease of 4%. 

The Bank's efficiency ratio for the three months ended December 31, 2016 was 59.91% compared to 67.64% in 2015, which represents a decrease of 11%. The Bank's efficiency ratio for the twelve months ended December 31, 2016 was 60.00% compared to 64.88% in 2015, which represents a decrease of 8%. The efficiency ratio illustrates, that for every dollar the Bank made for the three-month period ending December 31, 2016, the Bank spent $0.60 to make it, as compared to $0.68 one year ago. 

Capital ratios for the Bank remain well above the levels required for a "well capitalized" institution as designated by regulatory agencies. As of December 31, 2016, the tier 1 leverage ratio was 11.72%, the common equity tier 1 capital ratio was 13.93%, the tier 1 risk based capital ratio was 13.93%, and the total risk-based capital ratio was 15.12%.

CommerceWest Bank is a California based commercial bank with a unique vision and culture of focusing exclusively on the small to mid-size business community. Founded in 2001 and headquartered at 2111 Business Center Drive in Irvine, CA. The Bank serves businesses throughout California with an emphasis on clients in Orange, San Diego, Los Angeles, and Riverside Counties. We are a full service business bank and offer a wide range of commercial banking services, including concierge services, remote deposit solution, online banking, lines of credit, working capital loans, commercial real estate lending, SBA lending, and cash and treasury management services.

Mission Statement: CommerceWest Bank will create a complete banking experience for each client, catering to businesses and their specific banking needs, while accommodating our clients and providing them high-quality, low stress and personally tailored banking and financial services. 

Please visit www.cwbk.com to learn more about the bank.  "BANK ON THE DIFFERENCE"

Statements concerning future performance, developments or events, expectations for growth and income forecasts, and any other guidance on future periods, constitute forward-looking statements that are subject to a number of risks and uncertainties.  Actual results may differ materially from stated expectations.  Specific factors include, but are not limited to, loan production, balance sheet management, expanded net interest margin, the ability to control costs and expenses, interest rate changes, financial policies of the United States government and general economic conditions.  The Company disclaims any obligation to update any such factors or to publicly announce the results of any revisions to any forward-looking statements contained in this release to reflect future events or developments.

SOURCE CommerceWest Bank