Lighthouse Bank Reports Strong First-Quarter Earnings, Net Income Up 36 Percent and Assets Up 28 Percent Year-Over-Year

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Apr 21, 2017, 16:47 ET

SANTA CRUZ, Calif., April 21, 2017 /PRNewswire/ -- Locally owned Lighthouse Bank (OTC-QB: LGHT) today released unaudited financial results for the quarter-ended March 31, 2017. Net income was $709 thousand, a 36% increase over the same quarter in 2016, representing the Bank's 31^st successive quarter of profitable operations. Highlights for the first quarter results include: Total assets increased $51.6 million, or 28%, compared to the first quarter 2016; loans increased by $32.9 million, or 23%; and deposits increased $48.4 million, or 31%, year-over-year.

CEO Lane Lawson commented, "Our new Headquarters location in downtown Santa Cruz has increased our visibility, enhanced our profile in the community and helped us grow our assets to a record $235 million."

In April, DepositAccounts.com ranked Lighthouse Bank as the 5th healthiest bank in the nation in 2017. This represents the second consecutive year that the Bank has been ranked as the 5th healthiest, of the approximately 6,000 Federally-Insured banking institutions in the nation.

For the quarter-ended March 31, 2017, total assets increased to $235 million, an increase of $16.9 million, or 8%, from the quarter-ended December 31, 2016. The Bank experienced solid loan growth during the quarter, up $6.0 million, or 4%, to $175.4 million. Credit quality continues to remain strong. During the quarter, deposits increased $15.8 million, or 8% to $202.5 million.

For the quarter-ended March 31, 2017, total shareholders' equity increased by $757 thousand to $31.6 million. Year-over-year, shareholders' equity increased $3.1 million, or 11%.

In February, 2017 the Bank declared its third $0.08 per share quarterly cash dividend payment to shareholders, which was an increase of 6.67% over the four previous consecutive quarterly cash dividends of $0.075 per share. In early 2015, the Bank paid a special $0.40 per share cash dividend to shareholders, which followed two stock dividends granted in 2011 and 2013. Since January 2015, the Bank has paid $2,136,622 in cash dividends to shareholders.

During the quarter-ended March 31, 2017, the Bank continued with plans for its first full-service branch location in Silicon Valley, tentatively scheduled to open in September 2017. The Silicon Valley location, which opened as a Loan Production Office in December 2016 at 19240 Stevens Creek Blvd. in Cupertino, is adjacent to the new Main St. Cupertino Business Center and close to the 3.1 million sq. ft. Apple headquarters building currently under construction. The contiguous nature of the Silicon Valley market to that of Santa Cruz, staff experience in that market, as well as community bank consolidations, have combined to provide a unique growth opportunity for Lighthouse Bank in Silicon Valley.

In early April 2017, the Bank welcomed seasoned Silicon Valley bankers, Joe Wilson and Michael Khan, who are primarily responsible for originating business lending relationships in the Bay Area Market. Lane Lawson, Chief Executive Officer said, "We are pleased to welcome veterans Joe and Michael to Lighthouse Bank. Their experience in building relationships in the Silicon Valley business community and understanding of the unique needs of Bay Area businesses will support our expansion of commercial lending services. They share our commitment to personalized service to connect businesses with the resources in order to foster commercial growth in the communities we serve."

Lighthouse Bank's consistently strong financial results continue to place it at the top of the industry in a variety of categories including asset quality, capital adequacy, return on average assets, return on average equity and operational efficiency. SNL Financial ranked Lighthouse Bank as the 29th highest performing community bank in the nation based on 2016 performance of approximately 5100 banks of asset size under $1 billion. Financial Management Consulting Group (FMC) rated the Bank among the highest performing banks in the state, as 12^th out of 171 California banks in 2016 based on our overall performance.

For nineteen consecutive quarters, the Bank has been rated by Bauer Financial as Five-Star "Superior" for strong financial performance, the top rating given by the independent bank rating firm. Lighthouse Bank has received its sixth consecutive designation of Super Premier performing bank by The Findley Reports, Inc. based upon 2016 financial performance. Lighthouse Bank has no financial relationship with any of these rating agencies.

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

ABOUT LIGHTHOUSE BANK:

Lighthouse Bank is a locally owned and operated full-service commercial bank headquartered in Santa Cruz, 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 is committed to operating an open, ethical and financially successful company without engaging in the corporate excesses that have characterized the financial services industry. All decisions are intended to contribute to the long-term success of its clients, employees, owners and the communities it serves. Lighthouse Bank has never been subject to either formal or informal regulatory action.

Lighthouse Bank's headquarters are located at 2020 North Pacific Avenue in Downtown Santa Cruz, CA. Lighthouse Bank's common stock is listed under the stock symbol LGHT. More Information on the Bank may be obtained through its website 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
	3/31/2017	12/31/2016	$	%	3/31/2016	$	%

Balance Sheet

Total assets	$ 235,010,557	$ 218,069,473	$ 16,941,084	8%	$ 183,387,350	$ 51,623,207	28%
Gross loans	175,368,255	169,368,657	5,999,598	4%	142,499,843	32,868,412	23%
Allowance for loan losses	4,024,530	4,024,530	-	0%	3,349,251	675,279	20%
Non interest-bearing deposits	50,180,883	40,982,537	9,198,346	22%	34,910,233	15,270,650	44%
Total deposits	202,479,002	186,635,919	15,843,083	8%	154,081,223	48,397,779	31%
Shareholders' equity	31,629,377	30,872,471	756,906	2%	28,567,113	3,062,264	11%

Income Statement

Interest income	2,719,094	2,673,017	46,077	2%	2,111,873	607,221	29%
Interest expense	131,708	126,194	5,514	4%	95,971	35,737	37%
Net interest income	2,587,386	2,546,823	40,563	2%	2,015,902	571,484	28%

Non-interest income	65,253	68,820	(3,567)	-5%	58,954	6,299	11%
Non-interest expense	1,472,253	1,288,855	183,398	14%	1,160,919	311,334	27%
Income tax expense	471,261	284,646	186,615	66%	342,334	128,927	38%
Net income before loan loss provisions	709,125	1,042,142	(333,017)	-32%	571,603	137,522	24%
Provision for loan losses	-	51,000	(51,000)	-100%	49,000	(49,000)	-100%
Net income	$ 709,125	$ 991,142	$ (282,017)	-28%	$ 522,603	$ 186,522	36%

Earnings per share (basic)	$ 0.29	$ 0.42	$ (0.13)	-31%	$ 0.23	$ 0.06	26%
Book value per share	$ 12.97	$ 12.81	$ 0.15	1%	$ 12.30	$ 0.67	5%

Ratios
Net interest margin *	4.96%	4.97%			4.70%
Equity capital-to-total assets	13.5%	14.2%			15.6%
Return on Average Assets *	1.28%	1.83%			1.15%
Return on Average Equity *	9.17%	13.00%			7.43%
Allowance for Loan Losses-to-Total Loans	2.29%	2.38%			2.35%
Non-Performing Assets-to-Total Assets	0.00%	0.00%			0.04%
Efficiency Ratio *	55.5%	48.0%			56.0%
* Average for period