CommerceWest Bank Reports Strong Net Income, Liquidity And Capital Ratios For First Quarter 2011

CommerceWest Bank (OTCBB: CWBK) announced today its financial results for the three months ended March 31, 2011. Net income for the quarter was $382,000 or $0.09 per basic common share and $0.09 per diluted common share, as compared to earnings of $434,000 or $0.10 per basic common share and $0.10 per diluted common share for the three months ended March 31, 2010.

Financial performance highlights for the three months ended March 31, 2011:
  • Net Income of $382,000 for the quarter
  • Non-interest income growth of 24%
  • 16.8% increase in the allowance for loan losses as a percent of CommerceWest Bank loans
  • A fortress balance sheet, with a tier 1 leverage ratio of 12.81% and total risk based capital ratio of 23.23%
  • 69% decrease in nonperforming assets year over year
  • Strong liquidity with a liquidity position to total assets ratio of 42%

Mr. Ivo Tjan, Chairman and CEO said, “The Bank has spent the last eighteen months strengthening its fortress balance sheet, focusing on strengthening liquidity and risk based capital ratios. We’ve increased the Bank’s liquidity position to total assets ratio by 62% year over year and improved the leverage ratio by 13%, from 11.38% on March 31, 2010 to 12.81% on March 31, 2011. And also improved the total risk based capital position of the Bank by 33%, from 17.49% on March 31, 2010 to 23.23% on March 31, 2011.”

Mr. Tjan continued, “Having negotiated through the turbulent economic environment and absorbing the effects of the 2009 bank acquisition, the Bank is now positioned to focus on banking basics, making loans and attracting deposits. The Bank has recruited some very talented bankers to strategically augment the team during the first quarter of 2011. The Team is now focused on our core business model, producing organic growth with a disciplined approach to driving operating efficiency. By deploying our liquidity, we will improve our net interest margin, profitability, efficiency ratio, while at the same time assisting with the economic recovery by lending to small businesses.”

Total assets decreased $43.2 million as of March 31, 2011, a decrease of 13% as compared to the same period one year ago. Total loans decreased $54.7 million as of March 31, 2011, a decrease of 27% over the prior year. Cash and due from banks decreased $4.8 million or 7%. Total investments increased $21.3 million or 44% from the prior year.

Total deposits decreased $36.2 million as of March 31, 2011, a decrease of 12% from March 31, 2010. The Bank reduced borrowings outstanding by $6 million compared to the same period one year ago. The Bank’s liquidity position to total assets ratio improved from 26% as of March 31, 2010 to 42% as of March 31, 2011. Stockholders’ equity on March 31, 2011 was $43.9 million, an increase of 1% as compared to stockholders’ equity of $43.5 million a year ago.

Provision for loan losses for the quarter ended March 31, 2011 was $100,000 compared to $625,000 for the quarter ended March 31, 2010, a decrease of 84%. The Bank’s allowance for loan losses as a percent of total loans was 3.76% for the CommerceWest Bank portfolio on March 31, 2011 as compared to 3.22% on March 31, 2010, an increase of 16.8%.

Non-interest income for the three months ended March 31, 2011 was $694 thousand compared to $558 thousand for the same period last year, an increase of 24%.

Capital ratios for the Bank remain above the levels required for a “well capitalized” institution as designated by regulatory agencies. As of March 31, 2011, the leverage ratio was 12.81%, the tier 1 capital ratio was 21.97%, and the total risk-based capital ratio was 23.23%.

CommerceWest Bank is headquartered at 2111 Business Center Drive in Irvine, CA, with Regional Offices in Orange County, Riverside County, Los Angeles County and San Diego County. We are a full service business bank and offer a wide range of commercial banking services, including concierge services, remote deposit solution, full-service internet banking, lines of credit, term loans, commercial real estate lending, SBA lending, and full cash management.

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.
 
COMMERCEWEST BANK, N.A.
FINANCIAL HIGHLIGHTS

(in thousands, except per share and ratio data)
               

 
 
         
Increase

SELECTED INCOME STATEMENT DATA:
Mar 31, 2011 Mar 31, 2010 (Decrease)
Total net revenue 3,286 4,048 -19 %
Net interest income $ 2,592 $ 3,490 -26 %
Total non-interest income 694 558 24 %
Total non-interest expense 2,804 2,740 2 %
Net income 382 434 -12 %
 
 

PER COMMON SHARE:
Basic earnings per share $ 0.09 $ 0.10 -10 %
Diluted earnings per share $ 0.09 $ 0.10 -10 %
 
 

CAPITAL RATIOS:
Tier 1 leverage ratio 12.81 % 11.38 % 13 %
Tier 1 risk-based capital ratio 21.97 % 16.23 % 35 %
Total risk-based capital ratio 23.23 % 17.49 % 33 %
 
 

SELECTED BALANCE SHEET DATA (Period-end):
Total assets $ 300,600 $ 343,837 -13 %
Loans 144,093 198,827 -28 %
Deposits 254,781 290,958 -12 %
Stockholders' equity 43,999 43,546 1 %
 

Copyright Business Wire 2010

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