California | 0-30777 | 33-0898238 |
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
949 South Coast Drive, Costa Mesa, California | 92626 | |
(Address of principal executive offices) | (Zip Code) |
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
Common Stock, without par value | "PMBC" | Nasdaq Global Select Market |
Item 2.02 | Results of Operations and Financial Condition |
Item 9.01 | Financial Statements and Exhibits |
Exhibit No. | Description of Exhibit | ||
99.1 | Press Release issued July 22, 2019, announcing the consolidated financial results of Pacific Mercantile Bancorp for the three and six months ended June 30, 2019. |
PACIFIC MERCANTILE BANCORP | |||
Date: July 22, 2019 | By: | /s/ THOMAS M. VERTIN | |
Thomas M. Vertin, President and Chief Executive Officer |
FOR IMMEDIATE RELEASE | Member FDIC |
For more information contact | Equal Housing Lender |
Curt Christianssen, Chief Financial Officer, 714-438-2500 |
• | Net income of $2.7 million, or $0.12 per fully diluted share |
• | Total new loan commitments of $83.7 million and loan fundings of $52.7 million |
• | Total loans increased $14.5 million from March 31, 2019 |
• | Noninterest-bearing deposits increased $14.0 million from March 31, 2019, and $37.7 million from December 31, 2018 |
• | Stable non-performing assets and no provision for loan and lease losses during the three months ended June 30, 2019 |
Three Months Ended | Six Months Ended June 30, | ||||||||||||||||||
June 30, 2019 | March 31, 2019 | June 30, 2018 | 2019 | 2018 | |||||||||||||||
($ in thousands) | |||||||||||||||||||
Total interest income | $ | 16,466 | $ | 16,167 | $ | 15,914 | $ | 32,632 | $ | 30,929 | |||||||||
Total interest expense | 4,247 | 4,116 | 3,467 | 8,362 | 6,297 | ||||||||||||||
Net interest income | 12,219 | 12,051 | 12,447 | 24,270 | 24,632 | ||||||||||||||
Provision for loan and lease losses | — | 3,300 | — | 3,300 | — | ||||||||||||||
Total noninterest income | 1,386 | 1,490 | 1,136 | 2,876 | 2,191 | ||||||||||||||
Total noninterest expense | 9,707 | 8,983 | 9,299 | 18,691 | 18,832 | ||||||||||||||
Income tax (benefit) provision | 1,170 | 376 | (11,085 | ) | 1,545 | (11,085 | ) | ||||||||||||
Net income | $ | 2,728 | $ | 882 | $ | 15,369 | $ | 3,610 | $ | 19,076 |
• | An increase in interest income of $299 thousand, or 1.8%, primarily attributable to an increase in interest earned on short-term investments as a result of a higher average balances during the three months ended June 30, 2019 as compared to the three months ended March 31, 2019; partially offset by |
• | An increase in interest expense of $131 thousand, or 3.2%, primarily attributable to an increase in interest paid on our deposits as a result of higher average balances during the three months ended June 30, 2019 as compared to the three months ended March 31, 2019, which was primarily the result of an increase in the number of new operating company relationships. |
• | An increase in interest expense of $780 thousand, or 22.5%, primarily attributable to an increase in the volume of and rates of interest paid on our non-maturing interest bearing deposits for the three months ended June 30, 2019 as compared to the three months ended June 30, 2018, which was primarily the result of higher deposits due to new client acquisition, and our decision to increase the rate of interest paid on our non-maturing interest bearing deposits resulting from the rising interest rate environment, which was somewhat offset by a change in our mix of deposits from higher cost certificates of deposit to non-maturing interest and non-interest bearing deposits; partially offset by |
• | An increase in interest income of $552 thousand, or 3.5%, primarily attributable to an increase in interest earned on short-term investments as a result of higher average balances and an increase in the average yield on earning assets as a result of the rising interest rate environment during the three months June 30, 2019 as compared to the three months ended June 30, 2018, which was partially offset by a decrease of $812 thousand in interest recoveries on loans that had been on nonaccrual status but were paid in full during the three months ended June 30, 2018. |
• | An increase in interest expense of $2.1 million, or 32.8%, primarily attributable to an increase in the volume of and rates of interest paid on our deposits and other borrowings for the six months ended June 30, 2019 as compared to the six months ended June 30, 2018, which was primarily the result of higher deposits due to new client acquisition, our decision to increase |
• | An increase in interest income of $1.7 million, or 5.5%, primarily attributable to an increase in interest earned on loans and short-term investments as a result of higher average balances and an increase in the average yields during the six months ended June 30, 2019 as compared to the six months ended June 30, 2018, which was primarily the result of the rising interest rate environment, which was partially offset by a decrease of $1.6 million in interest recoveries on loans that had been on nonaccrual status but were paid in full during the six months ended June 30, 2018. |
• | An increase of $600 thousand in gain on sale of SBA loans during the six months ended June 30, 2019 as compared to the same period in 2018; and |
• | An increase in deposit related fees, credit card fees and loan service fees during the six months ended June 30, 2019 as compared to the same period in 2018; partially offset by |
• | A gain of $48 thousand on the sale of securities available for sale during the six months ended June 30, 2018 that did not occur in the same period in 2019. |
• | An increase of $296 thousand in salaries and employee benefits primarily related to an increase in the incentive compensation accrual during the second quarter of 2019 and an annual increase in employee salaries; and |
• | An increase of $394 thousand in our professional fees primarily related to higher legal fees during the second quarter of 2019; partially offset by |
• | A decrease of $67 thousand in our other real estate owned expense during the three months ended June 30, 2019 as compared to the three months ended March 31, 2019. |
• | An increase of $554 thousand in our professional fees primarily related to higher legal fees during the second quarter of 2019 and the recovery of legal fees attributable to the payoff of a loan relationship during the second quarter of 2018 that was previously on nonaccrual status; and |
• | An increase of $146 thousand in our data processing fees primarily related to a higher credit card and deposit volume in the second quarter of 2019; partially offset by |
• | A decrease of $179 thousand in salaries and employee benefits primarily related to employee benefits; |
• | A decrease of $73 thousand in our FDIC insurance expenses primarily related to a decrease in our premium; and |
• | A decrease in various expense accounts related to the normal course of operating, including expenses related to loan production and business development during the three months ended June 30, 2019 as compared to the three months ended June 30, 2018; |
• | A decrease of $899 thousand in salaries and employee benefits primarily related to a decrease in employee benefits and incentive compensation; |
• | A decrease of $191 thousand in our FDIC insurance expenses primarily related to a decrease in our premium; and |
• | A decrease in various expense accounts related to the normal course of operating, including expenses related to loan production and business development; partially offset by |
• | An increase of $600 thousand in our professional fees primarily related to higher legal fees in 2019 and the recovery of legal fees attributable to the payoff of a loan relationship in the second quarter of 2018 that was previously on nonaccrual status; |
• | An increase of $104 thousand in occupancy and equipment expense related to building and equipment maintenance; and |
• | An increase $272 thousand in data processing fees primarily related to a higher credit card and deposit volume. |
June 30, 2019 | March 31, 2019 | December 31, 2018 | ||||||||||||||||||
Amount | Percent of Total Loans | Amount | Percent of Total Loans | Amount | Percent of Total Loans | |||||||||||||||
($ in thousands) | ||||||||||||||||||||
Commercial loans | $ | 441,850 | 40.7 | % | $ | 448,021 | 41.9 | % | $ | 444,441 | 40.7 | % | ||||||||
Commercial real estate loans - owner occupied | 214,233 | 19.7 | % | 213,334 | 19.9 | % | 211,645 | 19.3 | % | |||||||||||
Commercial real estate loans - all other | 221,437 | 20.4 | % | 220,106 | 20.5 | % | 226,441 | 20.7 | % | |||||||||||
Residential mortgage loans - multi-family | 83,966 | 7.7 | % | 91,856 | 8.6 | % | 97,173 | 8.9 | % | |||||||||||
Residential mortgage loans - single family | 21,294 | 2.0 | % | 19,776 | 1.8 | % | 21,176 | 1.9 | % | |||||||||||
Construction and land development loans | 12,230 | 1.1 | % | 29,261 | 2.7 | % | 38,496 | 3.5 | % | |||||||||||
Consumer loans | 91,442 | 8.4 | % | 49,549 | 4.6 | % | 54,514 | 5.0 | % | |||||||||||
Gross loans | $ | 1,086,452 | 100.0 | % | $ | 1,071,903 | 100.0 | % | $ | 1,093,886 | 100.0 | % |
June 30, 2019 | March 31, 2019 | December 31, 2018 | |||||||||
Type of Deposit | ($ in thousands) | ||||||||||
Noninterest-bearing checking accounts | $ | 378,063 | $ | 364,083 | $ | 340,406 | |||||
Interest-bearing checking accounts | 112,626 | 100,294 | 64,144 | ||||||||
Money market and savings deposits | 450,057 | 450,003 | 460,355 | ||||||||
Certificates of deposit | 258,884 | 266,970 | 271,097 | ||||||||
Totals | $ | 1,199,630 | $ | 1,181,350 | $ | 1,136,002 |
2019 | 2018 | ||||||||||
June 30 | March 31 | June 30 | |||||||||
($ in thousands) | |||||||||||
Total non-performing loans | $ | 1,344 | $ | 1,321 | $ | 5,325 | |||||
Other real estate owned | — | — | 2,073 | ||||||||
Other non-performing assets | 82 | 96 | — | ||||||||
Total non-performing assets | $ | 1,426 | $ | 1,417 | $ | 7,398 | |||||
90-day past due loans(1) | $ | — | $ | — | $ | 2,669 | |||||
Total classified assets | $ | 5,174 | $ | 4,079 | $ | 14,757 | |||||
Allowance for loan and lease losses | $ | 11,474 | $ | 11,514 | $ | 13,369 | |||||
Allowance for loan and lease losses /gross loans | 1.06 | % | 1.07 | % | 1.26 | % | |||||
Allowance for loan and lease losses /total assets | 0.81 | % | 0.82 | % | 0.98 | % | |||||
Ratio of allowance for loan and lease losses to nonperforming loans | 853.72 | % | 871.61 | % | 251.06 | % | |||||
Ratio of nonperforming assets to total assets | 0.10 | % | 0.10 | % | 0.54 | % | |||||
Net quarterly charge-offs (recoveries) to gross loans | — | % | 0.49 | % | — | % |
2019 | 2018 | ||||||||||||||||||
June 30 | March 31 | December 31 | September 30 | June 30 | |||||||||||||||
($ in thousands) | |||||||||||||||||||
Balance at beginning of quarter | $ | 11,514 | $ | 13,506 | $ | 13,463 | $ | 13,369 | $ | 13,405 | |||||||||
Charge offs | (127 | ) | (5,698 | ) | (922 | ) | (419 | ) | (355 | ) | |||||||||
Recoveries | 87 | 406 | 965 | 513 | 319 | ||||||||||||||
Provision | — | 3,300 | — | — | — | ||||||||||||||
Balance at end of quarter | $ | 11,474 | $ | 11,514 | $ | 13,506 | $ | 13,463 | $ | 13,369 |
Actual At June 30, 2019 | Federal Regulatory Requirement to be Rated Well-Capitalized | |||||||||||
Amount | Ratio | Amount | Ratio | |||||||||
($ in thousands) | ||||||||||||
Total Capital to Risk Weighted Assets | $ | 166,176 | 13.5 | % | $ | 123,269 | At least 10.0 | |||||
Common Equity Tier 1 Capital to Risk Weighted Assets | $ | 154,352 | 12.5 | % | $ | 80,125 | At least 6.5 | |||||
Tier 1 Capital to Risk Weighted Assets | $ | 154,352 | 12.5 | % | $ | 98,615 | At least 8.0 | |||||
Tier 1 Capital to Average Assets | $ | 154,352 | 11.0 | % | $ | 70,416 | At least 5.0 |
Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||
June 30, 2019 | March 31, 2019 | June 30, 2018 | Jun '19 vs Mar '19 % Change | Jun '19 vs Jun '18 % Change | June 30, 2019 | June 30, 2018 | % Change | |||||||||||||||||||||
Total interest income | $ | 16,466 | $ | 16,167 | $ | 15,914 | 1.8 | % | 3.5 | % | $ | 32,632 | $ | 30,929 | 5.5 | % | ||||||||||||
Total interest expense | 4,247 | 4,116 | 3,467 | 3.2 | % | 22.5 | % | 8,362 | 6,297 | 32.8 | % | |||||||||||||||||
Net interest income | 12,219 | 12,051 | 12,447 | 1.4 | % | (1.8 | )% | 24,270 | 24,632 | (1.5 | )% | |||||||||||||||||
Provision for loan and lease losses | — | 3,300 | — | (100.0 | )% | 100.0 | % | 3,300 | — | — | % | |||||||||||||||||
Net interest income after provision for loan and lease losses | 12,219 | 8,751 | 12,447 | 39.6 | % | (1.8 | )% | 20,970 | 24,632 | (14.9 | )% | |||||||||||||||||
Non-interest income: | ||||||||||||||||||||||||||||
Service fees on deposits and other banking services | 443 | 398 | 407 | 11.3 | % | 8.8 | % | 840 | 794 | 5.8 | % | |||||||||||||||||
Net gain (loss) on sale of securities available for sale | — | — | — | — | % | — | % | — | 48 | (100.0 | )% | |||||||||||||||||
Net gain on sale of small business administration loans | 300 | 300 | — | — | % | 100.0 | % | 600 | — | — | % | |||||||||||||||||
Net loss on sale of other assets | (11 | ) | (25 | ) | — | (56.0 | )% | — | % | (36 | ) | (4 | ) | 800.0 | % | |||||||||||||
Other non-interest income | 654 | 817 | 729 | (20.0 | )% | (10.3 | )% | 1,472 | 1,353 | 8.8 | % | |||||||||||||||||
Total non-interest income | 1,386 | 1,490 | 1,136 | (7.0 | )% | 22.0 | % | 2,876 | 2,191 | 31.3 | % | |||||||||||||||||
Non-interest expense: | ||||||||||||||||||||||||||||
Salaries and employee benefits | 5,737 | 5,441 | 5,916 | 5.4 | % | (3.0 | )% | 11,177 | 12,076 | (7.4 | )% | |||||||||||||||||
Occupancy and equipment | 1,127 | 1,088 | 1,047 | 3.6 | % | 7.6 | % | 2,215 | 2,111 | 4.9 | % | |||||||||||||||||
Professional Fees | 1,190 | 796 | 636 | 49.5 | % | 87.1 | % | 1,986 | 1,386 | 43.3 | % | |||||||||||||||||
OREO expenses, net | 1 | 68 | 8 | (98.5 | )% | (87.5 | )% | 69 | 8 | 100.0 | % | |||||||||||||||||
FDIC Expense | 193 | 164 | 266 | 17.7 | % | (27.4 | )% | 357 | 548 | (34.9 | )% | |||||||||||||||||
Other non-interest expense | 1,459 | 1,426 | 1,426 | 2.3 | % | 2.3 | % | 2,887 | 2,703 | 6.8 | % | |||||||||||||||||
Total non-interest expense | 9,707 | 8,983 | 9,299 | 8.1 | % | 4.4 | % | 18,691 | 18,832 | (0.7 | )% | |||||||||||||||||
Income before income taxes | 3,898 | 1,258 | 4,284 | 209.9 | % | (9.0 | )% | 5,155 | 7,991 | (35.5 | )% | |||||||||||||||||
Income tax expense | 1,170 | 376 | (11,085 | ) | 211.2 | % | (110.6 | )% | 1,545 | (11,085 | ) | (113.9 | )% | |||||||||||||||
Net income (loss) from continuing operations | 2,728 | 882 | 15,369 | 209.3 | % | (82.2 | )% | 3,610 | 19,076 | (81.1 | )% | |||||||||||||||||
Net income | $ | 2,728 | $ | 882 | $ | 15,369 | 209.3 | % | (82.2 | )% | $ | 3,610 | $ | 19,076 | (81.1 | )% | ||||||||||||
Net income (loss) allocable to common shareholders | $ | 2,728 | $ | 882 | $ | 15,369 | 209.3 | % | (82.2 | )% | $ | 3,610 | $ | 19,076 | (81.1 | )% | ||||||||||||
Basic income per common share: | ||||||||||||||||||||||||||||
Net income available to common shareholders | $ | 0.12 | $ | 0.04 | $ | 0.66 | 200.0 | % | (81.8 | )% | $ | 0.15 | $ | 0.82 | (81.7 | )% | ||||||||||||
Diluted income per common share: | ||||||||||||||||||||||||||||
Net income available to common shareholders | $ | 0.12 | $ | 0.04 | $ | 0.65 | 200.0 | % | (81.5 | )% | $ | 0.15 | $ | 0.81 | (81.5 | )% | ||||||||||||
Weighted average number of common shares outstanding: | ||||||||||||||||||||||||||||
Basic | 22,620 | 21,824 | 23,332 | 3.6 | % | (3.1 | )% | 22,224 | 23,299 | (4.6 | )% | |||||||||||||||||
Diluted | 23,616 | 23,547 | 23,558 | 0.3 | % | 0.2 | % | 23,581 | 23,502 | 0.3 | % | |||||||||||||||||
Ratios from continuing operations(1): | ||||||||||||||||||||||||||||
Return on average assets | 0.78 | % | 0.26 | % | 4.57 | % | 0.52 | % | 2.89 | % | ||||||||||||||||||
Return on average equity | 7.57 | % | 2.50 | % | 51.01 | % | 5.06 | % | 32.45 | % | ||||||||||||||||||
Efficiency ratio | 71.35 | % | 66.34 | % | 68.46 | % | 68.85 | % | 70.21 | % |
(1) | Ratios for the three months ended June 30, 2019, March 31, 2019 and June 30, 2018 have been annualized. |
ASSETS | June 30, 2019 | December 31, 2018 | Increase/ (Decrease) | |||||||
Cash and due from banks | $ | 17,561 | $ | 13,250 | 32.5 | % | ||||
Interest bearing deposits with financial institutions(1) | 247,680 | 174,468 | 42.0 | % | ||||||
Interest bearing time deposits | 2,420 | 2,420 | — | % | ||||||
Investment securities (including stock) | 36,303 | 40,053 | (9.4 | )% | ||||||
Loans (net of allowances of $11,474 and $13,506, respectively) | 1,077,595 | 1,083,240 | (0.5 | )% | ||||||
Other real estate owned | — | 1,173 | (100.0 | )% | ||||||
Net deferred tax assets | 8,795 | 10,935 | (19.6 | )% | ||||||
Other assets | 28,763 | 23,799 | 20.9 | % | ||||||
Total assets | $ | 1,419,117 | $ | 1,349,338 | 5.2 | % | ||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||
Non-interest bearing deposits | $ | 378,063 | $ | 340,406 | 11.1 | % | ||||
Interest bearing deposits | ||||||||||
Interest checking | 112,626 | 64,144 | 75.6 | % | ||||||
Savings/money market | 450,057 | 460,355 | (2.2 | )% | ||||||
Certificates of deposit | 258,884 | 271,097 | (4.5 | )% | ||||||
Total interest bearing deposits | 821,567 | 795,596 | 3.3 | % | ||||||
Total deposits | 1,199,630 | 1,136,002 | 5.6 | % | ||||||
Other borrowings | 40,000 | 40,000 | — | % | ||||||
Other liabilities | 16,044 | 14,435 | 11.1 | % | ||||||
Junior subordinated debentures | 17,527 | 17,527 | — | % | ||||||
Total liabilities | 1,273,201 | 1,207,964 | 5.4 | % | ||||||
Shareholders’ equity | 145,916 | 141,374 | 3.2 | % | ||||||
Total Liabilities and Shareholders’ Equity | $ | 1,419,117 | $ | 1,349,338 | 5.2 | % | ||||
Book value per share | $ | 6.21 | $ | 6.06 | 2.5 | % | ||||
Shares outstanding, common | 23,514,870 | 21,916,195 | 7.3 | % |
(1) | Interest bearing deposits held in the Bank’s account maintained at the Federal Reserve Bank. |
Three Months Ended | ||||||||||||||||||||||||||||||||
June 30, 2019 | March 31, 2019 | June 30, 2018 | ||||||||||||||||||||||||||||||
Average Balance | Interest Earned/ Paid | Average Yield/ Rate | Average Balance | Interest Earned/ Paid | Average Yield/ Rate | Average Balance | Interest Earned/ Paid | Average Yield/ Rate | ||||||||||||||||||||||||
Interest earning assets | ||||||||||||||||||||||||||||||||
Short-term investments(1) | $ | 269,980 | $ | 1,620 | 2.41 | % | $ | 225,561 | $ | 1,355 | 2.44 | % | $ | 192,175 | $ | 864 | 1.80 | % | ||||||||||||||
Securities available for sale and stock(2) | 36,880 | 260 | 2.83 | % | 39,203 | 292 | 3.02 | % | 38,633 | 262 | 2.72 | % | ||||||||||||||||||||
Loans(3) | 1,062,228 | 14,586 | 5.51 | % | 1,080,771 | 14,520 | 5.45 | % | 1,089,135 | 14,788 | 5.45 | % | ||||||||||||||||||||
Total interest-earning assets | 1,369,088 | 16,466 | 4.82 | % | 1,345,535 | 16,167 | 4.87 | % | 1,319,943 | 15,914 | 4.84 | % | ||||||||||||||||||||
Noninterest-earning assets | ||||||||||||||||||||||||||||||||
Cash and due from banks | 15,573 | 15,084 | 16,617 | |||||||||||||||||||||||||||||
All other assets | 26,052 | 29,231 | 12,970 | |||||||||||||||||||||||||||||
Total assets | $1,410,713 | $1,389,850 | $1,349,530 | |||||||||||||||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||||||||||||||
Interest-bearing checking accounts | $ | 108,530 | 181 | 0.67 | % | $ | 95,475 | 161 | 0.68 | % | $ | 56,906 | 63 | 0.44 | % | |||||||||||||||||
Money market and savings accounts | 460,935 | 2,106 | 1.83 | % | 457,975 | 2,114 | 1.87 | % | 434,294 | 1,670 | 1.54 | % | ||||||||||||||||||||
Certificates of deposit | 261,721 | 1,466 | 2.25 | % | 272,256 | 1,349 | 2.01 | % | 326,660 | 1,349 | 1.66 | % | ||||||||||||||||||||
Other borrowings | 40,220 | 262 | 2.61 | % | 40,000 | 258 | 2.62 | % | 36,934 | 171 | 1.86 | % | ||||||||||||||||||||
Junior subordinated debentures | 17,527 | 232 | 5.31 | % | 17,527 | 234 | 5.41 | % | 17,527 | 214 | 4.90 | % | ||||||||||||||||||||
Total interest bearing liabilities | 888,933 | 4,247 | 1.92 | % | 883,233 | 4,116 | 1.89 | % | 872,321 | 3,467 | 1.59 | % | ||||||||||||||||||||
Noninterest bearing liabilities | ||||||||||||||||||||||||||||||||
Demand deposits | 360,597 | 341,134 | 346,553 | |||||||||||||||||||||||||||||
Accrued expenses and other liabilities | 16,544 | 22,277 | 9,802 | |||||||||||||||||||||||||||||
Shareholders' equity | 144,639 | 143,206 | 120,854 | |||||||||||||||||||||||||||||
Total liabilities and shareholders' equity | $1,410,713 | $1,389,850 | $1,349,530 | |||||||||||||||||||||||||||||
Net interest income | $ | 12,219 | $ | 12,051 | $12,447 | |||||||||||||||||||||||||||
Net interest income/spread | 2.90 | % | 2.98 | % | 3.25 | % | ||||||||||||||||||||||||||
Net interest margin | 3.58 | % | 3.63 | % | 3.78 | % |
(1) | Short-term investments consist of federal funds sold and interest bearing deposits that we maintain at other financial institutions. |
(2) | Stock consists of FHLB stock and Federal Reserve Bank of San Francisco stock. |
(3) | Loans include the average balance of nonaccrual loans. |
Six Months Ended | |||||||||||||||||||||
June 30, 2019 | June 30, 2018 | ||||||||||||||||||||
Average Balance | Interest Earned/ Paid | Average Yield/ Rate | Average Balance | Interest Earned/ Paid | Average Yield/ Rate | ||||||||||||||||
Interest earning assets | |||||||||||||||||||||
Short-term investments(1) | $ | 247,893 | $ | 2,975 | 2.42 | % | $ | 186,422 | $ | 1,560 | 1.69 | % | |||||||||
Securities available for sale and stock(2) | 38,035 | 551 | 2.92 | % | 40,789 | 536 | 2.65 | % | |||||||||||||
Loans(3) | 1,071,449 | 29,106 | 5.48 | % | 1,076,109 | 28,833 | 5.40 | % | |||||||||||||
Total interest-earning assets | 1,357,377 | 32,632 | 4.85 | % | 1,303,320 | 30,929 | 4.79 | % | |||||||||||||
Noninterest-earning assets | |||||||||||||||||||||
Cash and due from banks | 15,330 | 16,228 | |||||||||||||||||||
All other assets | 27,632 | 10,051 | |||||||||||||||||||
Total assets | 1,400,339 | 1,329,599 | |||||||||||||||||||
Interest-bearing liabilities: | |||||||||||||||||||||
Interest-bearing checking accounts | $ | 102,038 | $ | 342 | 0.68 | % | $ | 70,667 | $ | 177 | 0.51 | % | |||||||||
Money market and savings accounts | 459,463 | 4,220 | 1.85 | % | 392,046 | 2,654 | 1.37 | % | |||||||||||||
Certificates of deposit | 266,959 | 2,815 | 2.13 | % | 342,394 | 2,729 | 1.61 | % | |||||||||||||
Other borrowings | 40,110 | 520 | 2.61 | % | 38,489 | 337 | 1.77 | % | |||||||||||||
Junior subordinated debentures | 17,527 | 465 | 5.35 | % | 17,527 | 400 | 4.60 | % | |||||||||||||
Total interest bearing liabilities | 886,097 | 8,362 | 1.90 | % | 861,123 | 6,297 | 1.47 | % | |||||||||||||
Noninterest bearing liabilities | |||||||||||||||||||||
Demand deposits | 350,919 | 339,238 | |||||||||||||||||||
Accrued expenses and other liabilities | 19,397 | 10,706 | |||||||||||||||||||
Shareholders' equity | 143,926 | 118,532 | |||||||||||||||||||
Total liabilities and shareholders' equity | 1,400,339 | 1,329,599 | |||||||||||||||||||
Net interest income | $ | 24,270 | $ | 24,632 | |||||||||||||||||
Net interest income/spread | 2.95 | % | 3.32 | % | |||||||||||||||||
Net interest margin | 3.61 | % | 3.81 | % |
(1) | Short-term investments consist of federal funds sold and interest bearing deposits that we maintain at other financial institutions. |
(2) | Stock consists of FHLB stock and Federal Reserve Bank of San Francisco stock. |
(3) | Loans include the average balance of nonaccrual loans. |