Lighthouse Bank Reports Record Earnings for 2017, Total Assets top $261 Million

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Jan 22, 2018, 04:10 ET

SANTA CRUZ, Calif., Jan. 22, 2018 /PRNewswire/ -- Locally owned Lighthouse Bank (OTC-QB: LGHT) today released unaudited financial results for the quarter-ended December 31, 2017 and year-ended December 31, 2017.

Net income for 2017 was $3.0 million, a $474 thousand, or 19%, increase over 2016. Total assets grew to a record $261.1 million, an increase of $43.0 million, or 20%, from the previous year.

The Bank experienced solid loan and deposit growth during the year. Gross loans increased $44.0 million, or 26%, year-over-year, to $213.0 million. Total deposits increased $39.5 million, or 21%, to $226.0 million. The Bank continues to maintain exceptional credit quality with no past-due loans and no non-performing loans at year-end 2017.

Lane Lawson, Chief Executive Officer of Lighthouse Bank commented "2017 has been a tremendous year for the Bank. We have grown in Santa Cruz and expanded outside the area with the opening of our full-service office in Silicon Valley. We have added experienced relationship bankers, and the entire Lighthouse team has performed exceptionally. I am very proud of them. We look forward to continued success in 2018, including the positive impact of the new corporate tax rate."

Financial Highlights presented below:

	Year Ended December 31,
	2017	2016	Change
BALANCE SHEET

Total assets	$261,063,542	$ 218,069,473	20%
Gross loans	213,117,336	169,368,657	26%
Allowance for loan losses	4,688,529	4,024,530	16%
Non-interest-bearing deposits	60,840,430	40,982,537	48%
Total deposits	226,090,556	186,635,919	21%
Shareholders' equity	34,378,372	30,872,471	11%

NET INCOME	$3,006,685	$ 2,532,898	19%

RATIOS	2017	2016
Net interest margin*	4.98%	4.89%
Equity capital-to-total assets	13.2%	14.20%
Return on Average Assets*	1.24%	1.25%
Return on Average Equity*	9.16%	8.59%
Allowance for Loan Losses-to-Total Loans	2.20%	2.38%
Non-Performing Assets-to-Total Assets	0.00%	0.00%
Efficiency Ratio*	53.40%	52.10%
*Average for annual period

SHARE INFORMATION
Earnings per share (basic)	$ 1.20	$ 1.08
Book value per share	$ 13.45	$ 12.81

Total common shares outstanding	2,555,080	2,409,470

Fourth Quarter Earnings
Net Income of $533 thousand for the quarter-ended December 31, 2017 was down $445 thousand from the prior quarter due to a $540 thousand tax expense, which resulted from a one-time reevaluation of the Bank's deferred tax assets at the new Federal corporate tax rate of 21%.

FINANCIAL HIGHLIGHTS:

Fourth Quarter earnings of $533 thousand or $0.21 per share
Book value per share increased by $0.64, to $13.45 at December 31, 2017
Fourth Quarter 2017 Return on Average Assets and Equity of 0.82% and 6.16%, respectively
Quarter-ended December 31, 2017 Net Interest Margin was 5.01%

In October, 2017, the Bank declared its second $0.09 per share quarterly cash dividend to shareholders, following four previous consecutive quarterly cash dividends of $0.08 per share.

Lighthouse Bank marked its 10^th Anniversary on October 29, 2017. Since opening, the Bank has established itself as a consistent elite performer, earning consecutive top rankings based on a variety of categories including asset quality, capital adequacy, return on average assets, return on average equity and operational efficiency.

Recognition and Awards Received:

2016 & 2017 consecutive-year ranking as "Nation's 5^th Healthiest Bank" of 6,000 total banks.
SNL Financial ranking as "Nation's 29^th Highest Performing Bank" in 2016 of 5,100 banks of asset size under $1 billion.
Financial Management Consulting's "12^th Highest Performing Bank" out of 171 California banks, based on overall performance.
22-consecutive quarters possessing "Five-Star Superior" the top rating by Bauer Financial.
6 consecutive-year achievement of "Super Premier Performing Bank", the highest designation given by Findley Reports, Inc.

ABOUT LIGHTHOUSE BANK:
Lighthouse Bank is a highly rated locally owned and operated full-service commercial bank with offices in Santa Cruz and Santa Clara Counties. The Bank's headquarters are located at 2020 North Pacific Avenue in Santa Cruz, CA. The Bank's Silicon Valley office is located at 19240 Stevens Creek Blvd, Cupertino, CA. The Bank offers a full array of banking products and services to businesses, professionals, individuals, developers and commercial property owners. The Bank is dedicated to providing exceptional personalized service and access to decision makers who are close at hand. Lighthouse Bank's unique worldwide ATM fee waiver program and complimentary business courier service expand the Bank's geographical reach throughout Santa Cruz County and the Silicon Valley.

Lighthouse Bank's stock (LGHT) is actively traded via the Bank's market makers and online and full-service brokerage providers. More information on the Bank and historical financial performance may be obtained through the Bank's website at www.lighthousebank.net or by calling 831-600-4000.

Member FDIC / Equal Housing Lender / SBA Preferred Lender

The attached release may contain forward-looking statements that are subject to risks and uncertainties. Such risks and uncertainties may include but are not necessarily limited to fluctuation in interest rates, inflation, government regulations and general economic conditions, and competition within the business areas in which the Bank is conducting its operations, including the real estate market in California and other factors beyond the Bank's control. Such risks and uncertainties could cause results for subsequent interim periods or for the entire year to differ materially from those indicated. Readers should not place undue reliance on the forward-looking statements, which reflect management's view only as of the date hereof. The Bank undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances.

	Selected Financial Data (unaudited)
	Quarter-Ended		Change	Quarter-Ended	Change	Year-to-Date Ended		Change
	12/31/2017	9/30/2017	%	12/31/2016	%	12/31/2017	12/31/2016	%

Balance Sheet

Total assets	261,063,542	256,508,791	2%	$ 218,069,473	20%
Gross loans	213,117,336	193,370,670	10%	169,368,657	26%
Allowance for loan losses	4,688,529	4,360,530	8%	4,024,530	16%
Non interest-bearing deposits	60,840,430	60,030,905	1%	40,982,537	48%
Total deposits	226,090,556	221,640,019	2%	186,635,919	21%
Shareholders' equity	34,378,372	34,017,779	1%	30,872,471	11%

Income Statement

Interest income	3,269,765	3,155,220	4%	2,673,017	22%	$ 12,044,022	$ 9,657,768	25%
Interest expense	150,016	146,257	3%	126,194	19%	567,496	442,177	28%
Net interest income	3,119,749	3,008,963	4%	2,546,823	22%	11,476,526	9,215,591	25%

Non-interest income	79,466	311,795	-75%	68,820	15%	530,415	276,527	92%
Non-interest expense	1,752,796	1,650,584	6%	1,288,855	36%	6,396,774	4,930,746	30%
Income tax expense	585,186	412,196	42%	284,646	106%	1,939,482	1,294,974	50%
Net income before loan loss provisions	861,233	1,257,978	-32%	1,275,788	-32%	3,670,685	3,266,398	12%
Provision for loan losses	328,000	280,000	17%	51,000	543%	664,000	733,500	-9%
Net income	533,233	977,978	-45%	$ 991,142	-46%	3,006,685	$ 2,532,898	19%

Earnings per share (basic)	$ 0.21	$ 0.39	-46%	$ 0.42	-50%	$ 1.20	$ 1.08	11%
Book value per share	$ 13.45	$ 13.32	1%	$ 12.81	5%	$ 13.45	$ 12.81	5%

Ratios
Net interest margin *	5.01%	4.99%		4.97%		4.98%	4.89%
Equity capital-to-total assets	13.2%	13.3%		14.2%		13.2%	14.2%
Return on Average Assets *	0.82%	1.54%		1.83%		1.24%	1.25%
Return on Average Equity *	6.16%	11.54%		13.00%		9.16%	8.59%
Allowance for Loan Losses-to-Total Loans	2.20%	2.26%		2.38%		2.20%	2.38%
Non-Performing Assets-to-Total Assets	0.00%	0.00%		0.00%		0.00%	0.00%
Efficiency Ratio *	54.8%	49.7%		48.0%		53.4%	52.1%
* Average for period