American Riviera Bank (OTC Markets: ARBV) announced today unaudited net income of $2,118,000 ($0.48 per share) for the six months ended June 30, 2017, an increase from $1,606,000 ($0.37 per share) for the first six months of 2016. The annualized return on average assets of 0.95% and return on average equity of 8.40% represent an increase from the 0.80% and 7.31%, respectively, achieved for the same reporting period in the prior year. The Bank reported unaudited net income of $1,163,000 ($0.27 per share) for the second quarter ended June 30, 2017 compared to $1,424,000 ($0.33 per share) for the same quarter last year. The second quarter of 2016 included $577,000 of non-recurring interest income related to merger accounting, resulting in higher reportable earnings compared to the second quarter of 2017.

The Bank experienced significant growth in the last year, reporting $496 million in total assets as of June 30, 2017. Asset growth was made possible by total deposits increasing 24% from June 30, 2016, reaching $440 million at June 30, 2017. Non-interest bearing demand deposits increased 28% from the same reporting period last year. Deposit origination volume is noteworthy, with the Bank opening over 900 new accounts at our three locations during the first six months of 2017.

Loan demand remained strong, with total loans increasing 11% from June 30, 2016, reaching $397 million at June 30, 2017 with no other real estate owned. The Bank reported an annualized net interest margin of 4.70% for the six months ending June 30, 2017.

Jeff DeVine, President and Chief Executive Officer, stated, "American Riviera Bank has made significant gains in market share this year by focusing on the needs of our clients. We look forward to providing the same dedication to Paso Robles and surrounding communities with the opening of our loan production office in August and our full service branch by early 2018. We strive to balance quality growth with earnings and are pleased to report that as of June 30, 2017 our share price has increased 55% from last year."

As of June 30, 2017, American Riviera Bank maintained a strong capital position with a Tier 1 Capital Ratio of 11%; well above the regulatory guideline of 8% for well capitalized institutions. The tangible book value per share of American Riviera Bank common stock is $10.81 at June 30, 2017, an increase from $10.03 at June 30, 2016.

Company Profile

American Riviera Bank is a full-service community bank focused on serving the lending and deposit needs of businesses and consumers on the Central Coast of California. The state-chartered bank opened for business on July 18, 2006, with the support of local shareholders. Offices are located at 1033 Anacapa Street in Santa Barbara, 525 San Ysidro Road in Montecito, and 5880 Calle Real in Goleta. For seven consecutive years the Bank has been recognized for strong financial performance by the Findley Reports, and received the highest "Super Premier" rating from Findley for 2016. As of June 30, 2017, the Bank was rated five stars by BauerFinancial.

Statements concerning future performance, developments or events concerning expectations for growth and market 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, effects of interest rate changes, ability to control costs and expenses, impact of consolidation in the banking industry, financial policies of the US government, and general economic conditions.
 
Balance Sheets (unaudited)
(dollars in thousands)
      Jun 30,   Jun 30,   One Year
      2017     2016   Change
Assets
Cash & Due From Banks $ 46,054 $ 35,322 30 %
Fed Funds Sold 15,841 9,114 74 %
Securities 18,695 7,456 151 %
 
Loans 396,876 358,233 11 %
Allowance For Loan Losses   (4,001 )   (3,054 ) 31 %
Net Loans 392,875 355,179 11 %
 
Fixed Assets 1,210 1,362 -11 %
Goodwill and Other Intangibles 5,785 4,770 21 %
Other Assets   15,369     15,052   2 %
Total Assets   495,829     428,255   16 %
 
 
Liabilities & Shareholders' Equity
Demand Deposits 159,289 124,802 28 %
Interest Bearing Deposits   280,232     229,366   22 %
Total Deposits 439,521 354,168 24 %
 
Borrowed Funds 2,000 24,000 -92 %
Other Liabilities   1,092     1,983   -45 %
Total Liabilities 442,613 380,151 16 %
 
Common Stock 42,824 42,711 0 %
Retained Earnings 10,384 5,390 93 %
Other Capital   8     3   167 %
Total Shareholders' Equity   53,216     48,104   11 %
     
Total Liabilities & Shareholders' Equity $ 495,829   $ 428,255   16 %
 
Book Value Per Share $ 12.13 $ 11.13
Tangible Book Value Per Share $ 10.81 $ 10.03
 
 
Statements of Income (unaudited)
(dollars in thousands)
  Quarter Ended       6 Months Ended    
Jun 30,   Jun 30,   Jun 30,   Jun 30,  
      2017     2016   Change   2017     2016   Change
Interest Income
Interest and Fees on Loans $ 5,006 $ 4,794 4 % $ 9,794 $ 9,457 4 %
Net Fair Value Amortization Income 233 577 -60 % 468 577 -19 %
Interest on Securities 41 25 64 % 60 57 6 %
Interest on Fed Funds 28 9 223 % 42 16 159 %
Interest on Due From Banks   87     33   162 %   175     78   124 %
Total Interest Income 5,395 5,438 -1 % 10,539 10,185 3 %
 
Interest Expense
Interest Expense on Deposits 245 191 28 % 464 401 16 %
Interest Expense on Borrowings   18     25   -29 %   23     35   -34 %
Total Interest Expense   263     216   21 %   487     436   12 %
 
Net Interest Income 5,132 5,221 -2 % 10,052 9,749 3 %
Provision for Loan Losses   252     165   52 %   639     251   154 %
Net Interest Income After Provision 4,880 5,056 -3 % 9,413 9,498 -1 %
 
Non-Interest Income
Service Charges, Commissions and Fees 302 420 -28 % 576 632 -9 %
Other Non-Interest Income   76     85   -11 %   165     152   8 %
Total Non-Interest Income 378 505 -25 % 741 784 -5 %
 
Non-Interest Expense
Salaries and Employee Benefits 1,898 1,768 7 % 3,854 3,957 -3 %
Occupancy and Equipment 372 375 -1 % 741 766 -3 %
Other Non-Interest Expense   1,125     1,062   6 %   2,099     2,566   -18 %
Total Non-Interest Expense 3,395 3,205 6 % 6,694 7,289 -8 %
 
Net Income Before Provision for Taxes 1,863 2,356 -21 % 3,460 2,993 16 %
Provision for Taxes   700     932   -25 %   1,342     1,387   -3 %
Net Income   1,163     1,424   -18 %   2,118     1,606   32 %
 
Shares (end of period) 4,387,369 4,322,252 2 % 4,387,369 4,322,252 2 %
Earnings Per Share - Basic $ 0.27 $ 0.33 -20 % $ 0.48 $ 0.37 30 %
 
Return on Average Assets (annualized) 0.99 % 1.39 % 0.95 % 0.80 %
Return on Average Equity (annualized) 8.92 % 12.32 % 8.40 % 7.31 %
Net Interest Margin (annualized) 4.63 % 5.34 % 4.70 % 4.98 %
 

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