RBB Bancorp (NASDAQ:RBB) and its subsidiaries, Royal Business
Bank (the “Bank”) and RBB Asset Management Company (“RAM”),
collectively referred to herein as “the Company,” announced
financial results for the quarter ended September 30, 2023.
The Company reported net income of $12.0 million, or $0.63
diluted earnings per share, for the quarter ended September 30,
2023, compared to net income of $10.9 million, or $0.58 diluted
earnings per share, and $16.7 million, or $0.87 diluted earnings
per share, for the quarter ended June 30, 2023 and September 30,
2022, respectively.
“We were pleased to be awarded with a $5 million Community
Development Financial Institution (“CDFI”) Equitable Recovery
Program (“ERP”) award by the US Treasury,” said David Morris, CEO
of RBB Bancorp. “We believe it is a testament to our ongoing
efforts to support the communities in which we operate.”
Mr. Morris continued, “We continued to make progress on our goal
of reducing our loan to deposit ratio. We were also pleased to see
stabilization in credit and a reduction in expenses in the third
quarter.”
“We have done a good job managing through the market volatility
and improving corporate governance,” said Dr. James Kao, Chairman
of the Company. “The Board of Directors is confident that we now
have the right strategy and people in place to continue to build
shareholder value.”
Third Quarter 2023 Highlights Compared to
Second Quarter 2023
- Net income increased to $12.0 million, or $0.63 diluted
earnings per share.
- Net interest income decreased to $27.6 million.
- Noninterest income increased to $7.7 million and noninterest
expense decreased to $16.9 million.
- Total loans held for investment decreased by $75.0 million and
total deposits decreased by $21.3 million, resulting in a decrease
in the net loan to deposit ratio to 97.6% from 99.3% at the end of
the prior quarter.
- Return on average assets increased to 1.17%.
- Return on average tangible common equity increased to 11.04%.
(1)
- Net interest margin decreased to 2.87%.
- The ratio of allowance for credit losses to total loans
increased to 1.36% from 1.35% at the end of prior quarter.
- The Company's capital position remained strong with a ratio of
17.8% tier 1 common equity to risk-weighted assets.
- The Company will redeem $55 million of outstanding
Fixed-to-Floating Subordinated Notes due in 2028 (the “2028
Subordinated Notes”) on December 1, 2023.
(1) Reconciliations of the non–U.S. generally accepted
accounting principles (“GAAP”) measures are set forth at the end of
this press release.
Net Interest Income and Net Interest Margin
Net interest income before provision for credit losses was $27.6
million for the third quarter of 2023, compared to $31.9 million
for the second quarter of 2023. The $4.3 million decrease was
primarily attributable to an increase in interest expense on time
deposits and a decrease in interest and fees on loans, partially
offset by increases in interest income on interest-bearing deposits
and on investment securities. For the third quarter of 2023,
average time deposits increased $70.8 million and the interest rate
paid on time deposits increased 35 basis points to 4.33% from 3.98%
in the second quarter of 2023.
Compared to the third quarter of 2022, net interest income
before provision for credit losses decreased $11.4 million from
$39.0 million. The decrease was primarily attributable to an
increase in average interest-bearing deposits of $651.7 million and
a 301 basis point increase in the interest rate paid on
interest-bearing deposits, partially offset by an increase in
average loans of $31.5 million and a 46 basis point increase in the
yield earned on loans from 5.53% in the third quarter of 2022 to
5.99%.
Net interest margin was 2.87% for the third quarter of 2023, a
decrease of 50 basis points from 3.37% in the second quarter of
2023 primarily due to a 36 basis point increase in the average cost
of interest-bearing deposits from 3.47% in the second quarter of
2023 to 3.83% in the third quarter of 2023. Cost of
interest-bearing deposits increased due to increasing market rates
and peer bank deposit competition.
The Company will redeem on December 1, 2023 the 2028
Subordinated Notes at a redemption price equal to 100% of the
principal amount of the 2028 Subordinated Notes plus accrued and
unpaid interest to but excluding December 1, 2023. The 2028
Subordinated Notes have an aggregate principal amount outstanding
of $55 million. From and after December 1, 2023, all interest
on the 2028 Subordinated Notes will cease to accrue.
Noninterest Income
Noninterest income was $7.7 million for the third quarter of
2023, an increase of $5.2 million from $2.5 million in the second
quarter of 2023. The increase was primarily driven by a $5.0
million CDFI ERP award received, a $194,000 increase in gain on
sale of loans, and a $190,000 increase in gain on sale of other
real estate owned (“OREO”), partially offset by a $110,000 decrease
in wealth management commissions during the quarter.
Noninterest Expense
Noninterest expense for the third quarter of 2023 was $16.9
million, compared to $18.5 million for the second quarter of 2023.
The $1.6 million decrease was primarily attributable to a $1.9
million decrease in legal and other professional fees, partially
offset by a $417,000 increase in salaries and employee benefits
expenses primarily due to new hires in the quarter. The decrease in
legal and other professional fees were primarily due to the
insurance coverage with respect to legal expenses related to the
Company's voluntary cooperation with the Securities and Exchange
Commission's (“SEC”) requests for information, as disclosed in the
Company's Current Report on Form 8-K filed with the SEC on July 24,
2023, after all prior payments of the Company reached the $1.0
million retention amount.
Income Taxes
The effective tax rate was 29.8% for the third quarter of 2023,
29.5% for the second quarter of 2023, and 27.8% for the third
quarter of 2022.
Loan and Securities Portfolio
Loans held for investment, net of deferred fees and discounts,
totaled $3.1 billion as of September 30, 2023, a decrease of $75.0
million from June 30, 2023, and a decrease of $100.0 million from
September 30, 2022. The decrease from June 30, 2023 was primarily
due to a $49.4 million decrease in single-family residential
mortgages, a $19.2 million decrease in commercial real estate
loans, a $3.8 million decrease in commercial and industrial loans,
a $3.0 million decrease in Small Business Administration (“SBA”)
loans, and a $2.5 million decrease in other loans, partially offset
by a $2.9 million increase in construction and land development
loans. The decrease from September 30, 2022 was primarily due to a
$93.7 million decrease in construction and land development loans,
a $77.2 million decrease in commercial and industrial loans, a
$56.6 million decrease in commercial real estate loans, an $11.5
million decrease in SBA loans, and a $10.0 million decrease in
other loans, partially offset by a $149.0 million increase in
single-family residential mortgages. In the first nine months of
2023, management decreased loan growth to lower the loan to deposit
ratio and to strengthen the liquidity position of the Company.
As of September 30, 2023, the Bank’s total available-for-sale
securities amounted to $354.4 million, including available-for-sale
securities maturing in over 12 months of $259.4 million. As of
September 30, 2023, the Bank recorded gross unrealized losses of
$37.1 million on its available-for-sale securities compared to
gross unrealized losses of $32.3 million as of June 30, 2023 with
respect to its available-for-sale securities due to Federal Reserve
Bank raised interest rate by 25 basis points in July 2023.
Liquidity and Deposits
Total deposits were $3.2 billion as of September 30, 2023, which
reflected a decrease of $21.3 million or 0.7% compared to June 30,
2023, primarily due to a decrease in brokered deposits of $49.1
million, partially offset by an increase in time deposits of $31.7
million. As of September 30, 2023, the Company had $330.8 million
in cash on the balance sheet, which is an increase of $84.5 million
or 34.3% from June 30, 2023. In addition, the Company had $909.8
million in Federal Home Loan Bank borrowing availability, Fed fund
lines of $92.0 million, $41.9 million in available funds from the
Federal Reserve Bank's discount window and $261.2 million in
available-for-sale securities that were unpledged.
Credit Quality
Nonperforming assets totaled $40.4 million, or 0.99% of total
assets at September 30, 2023, compared to $42.2 million, or 1.04%
of total assets at June 30, 2023. The $1.8 million decrease in
nonperforming assets was due to loans that migrated to accrual
status of $2.2 million, loans charged-off of $2.2 million, loan
paydowns of $295,000, and one OREO of $293,000 that was sold,
partially offset by loans that migrated into non-accrual status of
$3.2 million, consisting primarily of commercial real estate loans
and single-family residential mortgages.
Special mention loans totaled $31.2 million or 1.00% of total
loans at September 30, 2023, compared to $24.2 million, or 0.76% of
total loans at June 30, 2023. The increase is due to additional
special mention loans of $9.3 million, consisting primarily of
commercial real estate loans, partially offset by an upgrade to
pass loans of $2.2 million.
Substandard loans totaled $71.4 million or 2.29% of total loans
at September 30, 2023, compared to $74.1 million, or 2.32% of total
loans at June 30, 2023. The decrease is due to loan paydowns of
$3.2 million and upgrades to pass loans of $823,000, partially
offset by additional substandard loans of $1.4 million, consisting
primarily of single-family residential mortgages.
30-89 day delinquent loans, excluding non-accrual loans,
increased $12.4 million to $19.7 million as of September 30, 2023
compared to $7.2 million as of June 30, 2023. The $12.4 million
increase in past due loans was primarily due to a new delinquent
commercial real estate loan of $16.1 million for one business day
payment delay, which reverted back to current in October 2023.
Offsetting the increase were loans that migrated back to past due
for less than 30 days in the amount of $4.8 million, consisting
primarily of single-family residential mortgages, loans that
converted to non-accrual status in the aggregate amount of
$835,000, and loan payoffs or paydowns of $575,000.
Total net charge-offs were $2.2 million for the third quarter of
2023, as compared to net charge-offs of $580,000 in the prior
quarter and net recoveries of $127,000 in the same quarter last
year.
Provision for credit losses were $1.4 million for the third
quarter of 2023, as compared to $380,000 in the prior quarter and
$1.8 million in the same quarter last year.
The allowance for credit losses totaled $42.4 million, or 1.36%
of loans held for investment at September 30, 2023, compared with
$43.1 million, or 1.35%, of loans held for investment at June 30,
2023.
Dividend Payout and Stock Repurchase
For the third quarter of 2023, the Board of Directors declared a
common stock cash dividend of $0.16 per share, payable on November
10, 2023 to stockholders of record on October 30, 2023.
On June 14, 2022, the Board of Directors authorized the
repurchase of up to 500,000 shares of common stock, of which
433,124 shares remain available. The repurchase program permits
shares to be repurchased in open market or private transactions,
through block trades, and pursuant to any trading plan that may be
adopted in accordance with SEC Rules 10b5-1 and 10b-8. The Company
did not repurchase any shares during the third quarter of 2023, and
has not repurchased any shares since October 24, 2022 pursuant to
this authorization.
Corporate Overview
RBB Bancorp is a community-based financial holding company
headquartered in Los Angeles, California. As of September 30, 2023,
the Company had total assets of $4.1 billion. Its wholly-owned
subsidiary, the Bank, is a full service commercial bank, which
provides business banking services to the Asian communities in Los
Angeles County, Orange County, and Ventura County in California, in
Las Vegas, Nevada, in Brooklyn, Queens, and Manhattan in New York,
in Edison, New Jersey, in the Chicago neighborhoods of Chinatown
and Bridgeport, Illinois, and on Oahu, Hawaii. Bank services
include remote deposit, E-banking, mobile banking, commercial and
investor real estate loans, business loans and lines of credit,
commercial and industrial loans, SBA 7A and 504 loans, 1-4 single
family residential loans, automobile lending, trade finance, a full
range of depository account products and wealth management
services. The Bank has nine branches in Los Angeles County, two
branches in Ventura County, one branch in Orange County,
California, one branch in Las Vegas, Nevada, three branches and one
loan operation center in Brooklyn, three branches in Queens, one
branch in Manhattan in New York, one branch in Edison, New Jersey,
two branches in Chicago, Illinois, and one branch in Honolulu,
Hawaii. The Company's administrative and lending center is located
at 1055 Wilshire Blvd., Los Angeles, California 90017, and its
finance and operations center is located at 7025 Orangethorpe Ave.,
Buena Park, California 90621. The Company's website address is
www.royalbusinessbankusa.com.
Conference Call
Management will hold a conference call at 11:00 a.m. Pacific
time/2:00 p.m. Eastern time on Tuesday, October 24, 2023, to
discuss the Company’s third quarter 2023 financial results.
To listen to the conference call, please dial 1-888-506-0062 or
1-973-528-0011, the Participant ID code is 626566, conference ID
RBBQ323. A replay of the call will be made available at
1-877-481-4010 or 1-919-882-2331, the passcode is 49264,
approximately one hour after the conclusion of the call and will
remain available through November 7, 2023.
The conference call will also be simultaneously webcast over the
Internet; please visit our Royal Business Bank website at
www.royalbusinessbankusa.com and click
on the “Investors” tab to access the call from the site. This
webcast will be recorded and available for replay on our website
approximately two hours after the conclusion of the conference
call.
Disclosure
This press release contains certain non-GAAP financial
disclosures for tangible common equity and tangible assets and
adjusted earnings. The Company uses certain non-GAAP financial
measures to provide meaningful supplemental information regarding
the Company’s operational performance and to enhance investors’
overall understanding of such financial performance. Please refer
to the tables at the end of this release for a presentation of
performance ratios in accordance with GAAP and a reconciliation of
the non-GAAP financial measures to the GAAP financial measures.
Safe Harbor
Certain matters set forth herein (including the exhibits hereto)
constitute forward-looking statements relating to the Company’s
current business plans and expectations and our future financial
position and operating results. These forward-looking statements
are subject to risks and uncertainties that could cause actual
results, performance and/or achievements to differ materially from
those projected. These risks and uncertainties include, but are not
limited to, business and economic conditions generally and in the
financial services industry, nationally and within our current and
future geographic markets, including the tight labor market,
ineffective management of the U.S. federal budget or debt or
turbulence or uncertainly in domestic of foreign financial markets;
the strength of the United States economy in general and the
strength of the local economies in which we conduct operations; our
ability to attract and retain deposits and access other sources of
liquidity; possible additional provisions for loan losses and
charge-offs; credit risks of lending activities and deterioration
in asset or credit quality; extensive laws and regulations and
supervision that we are subject to, including potential supervisory
action by bank supervisory authorities; increased costs of
compliance and other risks associated with changes in regulation,
including any amendments to the Dodd-Frank Wall Street Reform and
Consumer Protection Act; compliance with the Bank Secrecy Act and
other money laundering statutes and regulations; potential goodwill
impairment; liquidity risk; fluctuations in interest rates; the
transition away from the London Interbank Offering Rate (LIBOR) and
related uncertainty as well as the risks and costs related to our
adopted alternative reference rate, including the Secured Overnight
Financing Rate (SOFR); risks associated with acquisitions and the
expansion of our business into new markets; inflation and
deflation; real estate market conditions and the value of real
estate collateral; environmental liabilities; our ability to
compete with larger competitors; our ability to retain key
personnel; successful management of reputational risk; severe
weather, natural disasters, earthquakes, fires; or other adverse
external events could harm our business; geopolitical conditions,
including acts or threats of terrorism, actions taken by the United
States or other governments in response to acts or threats of
terrorism and/or military conflicts, including the conflicts
between Russia and Ukraine and in the Middle East, which could
impact business and economic conditions in the United States and
abroad; public health crises and pandemics, including the COVID-19
pandemic, and their effects on the economic and business
environments in which we operate, including our credit quality and
business operations, as well as the impact on general economic and
financial market conditions; general economic or business
conditions in Asia, and other regions where the Bank has
operations; failures, interruptions, or security breaches of our
information systems; climate change, including any enhanced
regulatory, compliance, credit and reputational risks and costs;
cybersecurity threats and the cost of defending against them; our
ability to adapt our systems to the expanding use of technology in
banking; risk management processes and strategies; adverse results
in legal proceedings; the impact of regulatory enforcement actions,
if any; certain provisions in our charter and bylaws that may
affect acquisition of the Company; changes in tax laws and
regulations; the impact of governmental efforts to restructure the
U.S. financial regulatory system; the impact of future or recent
changes in the Federal Deposit Insurance Corporation ("FDIC")
insurance assessment rate of the rules and regulations related to
the calculation of the FDIC insurance assessment amount; the effect
of changes in accounting policies and practices or accounting
standards, as may be adopted from time-to-time by bank regulatory
agencies, the SEC, the Public Company Accounting Oversight Board,
the Financial Accounting Standards Board or other accounting
standards setters, including Accounting Standards Update 2016-13
(Topic 326, “Measurement of Current Losses on Financial
Instruments, commonly referenced as the Current Expected Credit
Losses Model, which changed how we estimate credit losses and may
further increase the required level of our allowance for credit
losses in future periods; market disruption and volatility;
fluctuations in the Bancorp’s stock price; restrictions on
dividends and other distributions by laws and regulations and by
our regulators and our capital structure; issuances of preferred
stock; our ability to raise additional capital, if needed, and the
potential resulting dilution of interests of holders of our common
stock; the soundness of other financial institutions; our ongoing
relations with our various federal and state regulators, including
the SEC, FDIC, FRB and California Department of Financial
Protection and Innovation; our success at managing the risks
involved in the foregoing items and all other factors set forth in
the Company’s public reports, including its Annual Report as filed
under Form 10-K and Form 10-K/A for the year ended December 31,
2022, and particularly the discussion of risk factors within that
document. The Company does not undertake, and specifically
disclaims any obligation, to update any forward-looking statements
to reflect occurrences or unanticipated events or circumstances
after the date of such statements except as required by law. Any
statements about future operating results, such as those concerning
accretion and dilution to the Company’s earnings or shareholders,
are for illustrative purposes only, are not forecasts, and actual
results may differ.
RBB BANCORP AND
SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE
SHEETS
(Unaudited)
(Dollars in thousands)
September 30,
June 30,
September 30,
2023
2023
2022
Assets
Cash and due from banks
$
330,791
$
246,325
$
134,179
Federal funds sold and other cash
equivalents
—
—
40,000
Total cash and cash equivalents
330,791
246,325
174,179
Interest-bearing deposits in other
financial institutions
600
600
600
Investment securities available for
sale
354,378
391,116
266,270
Investment securities held to maturity
5,214
5,718
5,735
Mortgage loans held for sale
62
555
1,185
Loans held for investment
3,120,952
3,195,995
3,220,913
Allowance for credit losses
(42,430
)
(43,092
)
(36,047
)
Net loans held for investment
3,078,522
3,152,903
3,184,866
Premises and equipment, net
26,134
26,600
26,850
Federal Home Loan Bank (FHLB) stock
15,000
15,000
15,000
Cash surrender value of life insurance
58,346
57,989
56,975
Goodwill
71,498
71,498
71,498
Servicing assets
8,439
8,702
10,054
Core deposit intangibles
3,010
3,246
3,971
Right-of-use assets- operating leases
29,949
28,677
24,768
Accrued interest and other assets
87,411
66,689
63,278
Total assets
$
4,069,354
$
4,075,618
$
3,905,229
Liabilities and shareholders'
equity
Deposits:
Noninterest-bearing demand
$
572,393
$
585,746
$
916,301
Savings, NOW and money market accounts
608,020
598,546
882,126
Time deposits, $250,000 and under
1,237,831
1,275,476
608,489
Time deposits, greater than $250,000
735,828
715,648
552,754
Total deposits
3,154,072
3,175,416
2,959,670
FHLB advances
150,000
150,000
240,000
Long-term debt, net of debt issuance
costs
174,019
173,874
173,441
Subordinated debentures
14,884
14,829
14,665
Lease liabilities - operating leases
31,265
29,915
25,701
Accrued interest and other liabilities
39,111
31,294
19,953
Total liabilities
3,563,351
3,575,328
3,433,430
Shareholders' equity:
Shareholders' equity
531,692
522,623
494,248
Non-controlling interest
72
72
72
Accumulated other comprehensive loss, net
of tax
(25,761
)
(22,405
)
(22,521
)
Total shareholders' equity
506,003
500,290
471,799
Total liabilities and shareholders’
equity
$
4,069,354
$
4,075,618
$
3,905,229
RBB BANCORP AND
SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF INCOME
(Unaudited)
(Dollars in thousands, except
share and per share data)
For the Three Months
Ended
September 30, 2023
June 30, 2023
September 30, 2022
Interest and dividend income:
Interest and fees on loans
$
47,617
$
50,810
$
43,588
Interest on interest-bearing deposits
3,193
2,112
373
Interest on investment securities
4,211
3,574
1,784
Dividend income on FHLB stock
290
259
224
Interest on federal funds sold and
other
252
247
445
Total interest income
55,563
57,002
46,414
Interest expense:
Interest on savings deposits, NOW and
money market accounts
3,106
2,778
1,529
Interest on time deposits
21,849
19,169
2,460
Interest on subordinated debentures and
long term debt
2,579
2,550
2,427
Interest on other borrowed funds
440
579
1,020
Total interest expense
27,974
25,076
7,436
Net interest income before provision for
credit losses
27,589
31,926
38,978
Provision for credit losses
1,399
380
1,766
Net interest income after provision for
credit losses
26,190
31,546
37,212
Noninterest income:
Service charges, fees and other
6,347
1,525
1,214
Gain on sale of loans
212
18
265
Loan servicing fees, net of
amortization
623
606
724
Increase in cash surrender value of life
insurance
356
344
332
Gain on sale of other real estate
owned
190
—
—
Total noninterest income
7,728
2,493
2,535
Noninterest expense:
Salaries and employee benefits
9,744
9,327
9,561
Occupancy and equipment expenses
2,414
2,430
2,349
Data processing
1,315
1,356
1,306
Legal and professional
1,022
2,872
1,077
Office expenses
437
350
382
Marketing and business promotion
340
252
364
Insurance and regulatory assessments
730
809
441
Core deposit premium
236
235
277
Other expenses
638
886
940
Total noninterest expense
16,876
18,517
16,697
Income before income taxes
17,042
15,522
23,050
Income tax expense
5,077
4,573
6,398
Net income
$
11,965
$
10,949
$
16,652
Net income per share
Basic
$
0.63
$
0.58
$
0.88
Diluted
$
0.63
$
0.58
$
0.87
Cash Dividends declared per common
share
$
0.16
$
0.16
$
0.14
Weighted-average common shares
outstanding
Basic
18,995,303
18,993,483
18,988,443
Diluted
18,997,304
18,995,100
19,130,447
RBB BANCORP AND
SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF INCOME
(Unaudited)
(Dollars in thousands, except
share and per share data)
For the Nine Months
Ended
September 30, 2023
September 30, 2022
Interest and dividend income:
Interest and fees on loans
$
148,369
$
121,631
Interest on interest-earning deposits
6,096
655
Interest on investment securities
10,321
4,210
Dividend income on FHLB stock
814
673
Interest on federal funds sold and
other
716
1,149
Total interest income
166,316
128,318
Interest expense:
Interest on savings deposits, NOW and
money market accounts
8,180
3,091
Interest on time deposits
54,424
5,540
Interest on subordinated debentures and
long term debt
7,668
7,154
Interest on other borrowed funds
2,428
1,974
Total interest expense
72,700
17,759
Net interest income before provision for
credit losses
93,616
110,559
Provision for credit losses
3,793
3,048
Net interest income after provision for
credit losses
89,823
107,511
Noninterest income:
Service charges, fees and other
9,108
3,745
Gain on sale of loans
258
1,783
Loan servicing fees, net of
amortization
1,959
1,628
Increase in cash surrender value of life
insurance
1,036
986
Gain on sale of fixed assets
32
757
Gain on sale of other real estate
owned
190
—
Total noninterest income
12,583
8,899
Noninterest expense:
Salaries and employee benefits
28,935
28,558
Occupancy and equipment expenses
7,242
6,728
Data processing
3,969
3,857
Legal and professional
6,907
4,337
Office expenses
1,163
1,033
Marketing and business promotion
892
1,172
Insurance and regulatory assessments
2,043
1,360
Core deposit premium
708
833
Other expenses
2,445
2,489
Total noninterest expense
54,304
50,367
Income before income taxes
48,102
66,043
Income tax expense
14,218
19,297
Net income
$
33,884
$
46,746
Net income per share
Basic
$
1.78
$
2.44
Diluted
$
1.78
$
2.41
Cash Dividends declared per common
share
$
0.48
$
0.42
Weighted-average common shares
outstanding
Basic
18,991,579
19,142,732
Diluted
19,013,838
19,415,558
RBB BANCORP AND
SUBSIDIARIES
AVERAGE BALANCE SHEET AND NET
INTEREST INCOME
(Unaudited)
For the Three Months
Ended
September 30, 2023
June 30, 2023
September 30, 2022
Average
Interest
Yield /
Average
Interest
Yield /
Average
Interest
Yield /
(tax-equivalent basis, dollars in
thousands)
Balance
& Fees
Rate
Balance
& Fees
Rate
Balance
& Fees
Rate
Interest-earning assets:
Federal funds sold, cash equivalents &
other (1)
$
285,484
$
3,734
5.19
%
$
179,023
$
2,619
5.87
%
$
141,737
$
1,042
2.92
%
Securities
Available for sale (2)
369,459
4,187
4.50
%
348,343
3,547
4.08
%
318,066
1,758
2.19
%
Held to maturity (2)
5,385
48
3.54
%
5,720
51
3.58
%
5,738
50
3.46
%
Mortgage loans held for sale
739
13
6.98
%
52
1
6.65
%
420
6
5.48
%
Loans held for investment: (3)
Real estate
2,968,246
43,583
5.83
%
3,064,633
46,304
6.06
%
2,820,022
38,999
5.49
%
Commercial
187,140
4,021
8.52
%
207,493
4,503
8.70
%
303,899
4,583
5.98
%
Total loans held for investment
3,155,386
47,604
5.99
%
3,272,126
50,807
6.23
%
3,123,921
43,582
5.53
%
Total interest-earning assets
3,816,453
$
55,586
5.78
%
3,805,264
$
57,025
6.01
%
3,589,882
$
46,438
5.13
%
Noninterest-earning assets
250,083
244,316
250,737
Total assets
$
4,066,536
$
4,049,580
$
3,840,619
Interest-bearing liabilities
NOW
$
55,325
$
201
1.44
%
$
59,789
$
202
1.36
%
$
74,518
$
91
0.48
%
Money Market
403,300
2,655
2.61
%
432,384
2,519
2.34
%
612,743
1,376
0.89
%
Saving deposits
123,709
249
0.80
%
111,214
57
0.21
%
147,349
62
0.17
%
Time deposits, $250,000 and under
1,285,320
14,090
4.35
%
1,221,760
12,391
4.07
%
566,730
1,221
0.85
%
Time deposits, greater than $250,000
717,026
7,759
4.29
%
709,803
6,778
3.83
%
531,655
1,239
0.92
%
Total interest-bearing deposits
2,584,680
24,954
3.83
%
2,534,950
21,947
3.47
%
1,932,995
3,989
0.82
%
FHLB advances
150,000
440
1.16
%
160,220
579
1.45
%
239,674
1,020
1.69
%
Long-term debt
173,923
2,194
5.00
%
173,780
2,194
5.06
%
173,345
2,194
5.02
%
Subordinated debentures
14,848
385
10.29
%
14,793
356
9.65
%
14,629
233
6.32
%
Total interest-bearing liabilities
2,923,451
27,973
3.80
%
2,883,743
25,076
3.49
%
2,360,643
7,436
1.25
%
Noninterest-bearing liabilities
Noninterest-bearing deposits
571,371
606,015
964,867
Other noninterest-bearing liabilities
67,244
59,760
41,003
Total noninterest-bearing liabilities
638,615
665,775
1,005,870
Shareholders' equity
504,470
500,062
474,106
Total liabilities and shareholders'
equity
$
4,066,536
$
4,049,580
$
3,840,619
Net interest income / interest rate
spreads
$
27,613
1.98
%
$
31,949
2.52
%
$
39,002
3.88
%
Net interest margin
2.87
%
3.37
%
4.31
%
(1)
Includes income and average balances for
FHLB stock, term federal funds, interest-bearing time deposits and
other miscellaneous interest-bearing assets.
(2)
Interest income and average rates for
tax-exempt loans and securities are presented on a tax-equivalent
basis.
(3)
Average loan balances include nonaccrual
loans and loans held for sale. Interest income on loans includes -
amortization of deferred loan fees, net of deferred loan costs.
RBB BANCORP AND
SUBSIDIARIES
AVERAGE BALANCE SHEET AND NET
INTEREST INCOME
(Unaudited)
For the Nine Months
Ended
September 30, 2023
September 30, 2022
Average
Interest
Yield /
Average
Interest
Yield /
(tax-equivalent basis, dollars in
thousands)
Balance
& Fees
Rate
Balance
& Fees
Rate
Interest-earning assets:
Federal funds sold, cash equivalents &
other (1)
$
192,393
$
7,625
5.30
%
$
338,253
$
2,477
0.98
%
Securities
Available for sale (2)
332,007
10,245
4.13
%
369,808
4,126
1.49
%
Held to maturity (2)
5,610
151
3.60
%
5,909
158
3.57
%
Mortgage loans held for sale
295
16
7.25
%
1,624
62
5.10
%
Loans held for investment: (3)
Real estate
3,041,393
134,790
5.93
%
2,696,183
107,301
5.32
%
Commercial
214,618
13,562
8.45
%
336,630
14,268
5.67
%
Total loans held for investment
3,256,011
148,352
6.09
%
3,032,813
121,569
5.36
%
Total interest-earning assets
3,786,316
$
166,389
5.88
%
3,748,407
$
128,392
4.58
%
Noninterest-earning assets
244,822
245,137
Total assets
$
4,031,138
$
3,993,544
Interest-bearing liabilities
NOW
$
59,476
$
511
1.15
%
$
75,182
$
185
0.33
%
Money Market
431,299
7,314
2.27
%
654,522
2,777
0.57
%
Saving deposits
118,550
354
0.40
%
147,033
129
0.12
%
Time deposits, $250,000 and under
1,141,290
33,906
3.97
%
573,401
2,698
0.63
%
Time deposits, greater than $250,000
729,699
20,519
3.76
%
542,535
2,842
0.70
%
Total interest-bearing deposits
2,480,314
62,604
3.37
%
1,992,673
8,631
0.58
%
FHLB advances
179,707
2,428
1.81
%
191,136
1,974
1.38
%
Long-term debt
173,780
6,583
5.06
%
173,202
6,583
5.08
%
Subordinated debentures
14,794
1,084
9.80
%
14,575
571
5.24
%
Total interest-bearing liabilities
2,848,595
72,699
3.41
%
2,371,586
17,759
1.00
%
Noninterest-bearing liabilities
Noninterest-bearing deposits
624,781
1,115,153
Other noninterest-bearing liabilities
58,774
36,257
Total noninterest-bearing liabilities
683,555
1,151,410
Shareholders' equity
498,988
470,548
Total liabilities and shareholders'
equity
$
4,031,138
$
3,993,544
Net interest income / interest rate
spreads
$
93,690
2.47
%
$
110,633
3.58
%
Net interest margin
3.31
%
3.95
%
(1)
Includes income and average balances for
FHLB stock, term federal funds, interest-bearing time deposits and
other miscellaneous interest-bearing assets.
(2)
Interest income and average rates for
tax-exempt loans and securities are presented on a tax-equivalent
basis.
(3)
Average loan balances include nonaccrual
loans and loans held for sale. Interest income on loans includes -
amortization of deferred loan fees, net of deferred loan costs.
RBB BANCORP AND
SUBSIDIARIES
SELECTED FINANCIAL
HIGHLIGHTS
(Unaudited)
For the Three Months
Ended
September 30,
June 30,
September 30,
2023
2023
2022
Per share data (common stock)
Book value
$
26.64
$
26.34
$
24.82
Tangible book value (1)
$
22.72
$
22.40
$
20.85
Performance ratios
Return on average assets, annualized
1.17
%
1.08
%
1.72
%
Return on average shareholders' equity,
annualized
9.41
%
8.78
%
13.93
%
Return on average tangible common equity,
annualized (1)
11.04
%
10.33
%
16.58
%
Noninterest income to average assets,
annualized
0.75
%
0.25
%
0.26
%
Noninterest expense to average assets,
annualized
1.65
%
1.83
%
1.72
%
Yield on average earning assets
5.78
%
6.01
%
5.13
%
Cost of average total deposits
3.14
%
2.80
%
0.55
%
Cost of average interest-bearing
deposits
3.83
%
3.47
%
0.82
%
Cost of average interest-bearing
liabilities
3.80
%
3.49
%
1.25
%
Accretion on loans to average earning
assets
0.00
%
0.04
%
0.01
%
Net interest spread
1.98
%
2.52
%
3.88
%
Net interest margin
2.87
%
3.37
%
4.31
%
Efficiency ratio (2)
47.78
%
53.80
%
40.22
%
Common stock dividend payout ratio
25.40
%
27.59
%
15.91
%
(1)
Reconciliations of the non–GAAP measures
are set forth at the end of this press release.
(2)
Ratio calculated by dividing noninterest
expense by the sum of net interest income before provision for
credit losses and noninterest income.
RBB BANCORP AND
SUBSIDIARIES
SELECTED FINANCIAL
HIGHLIGHTS
(Unaudited)
For the Nine Months Ended
September 30,
2023
2022
Per share data (common stock)
Book value
$
26.64
$
24.82
Tangible book value (1)
$
22.72
$
20.85
Performance ratios
Return on average assets, annualized
1.12
%
1.57
%
Return on average shareholders' equity,
annualized
9.08
%
13.28
%
Return on average tangible common equity,
annualized (1)
10.68
%
15.80
%
Noninterest income to average assets,
annualized
0.42
%
0.30
%
Noninterest expense to average assets,
annualized
1.80
%
1.69
%
Yield on average earning assets
5.88
%
4.58
%
Cost of average deposits
2.70
%
0.37
%
Cost of average interest-bearing
deposits
3.37
%
0.58
%
Cost of average interest-bearing
liabilities
3.41
%
1.00
%
Accretion on loans to average earning
assets
0.02
%
0.02
%
Net interest spread
2.47
%
3.58
%
Net interest margin
3.31
%
3.95
%
Efficiency ratio (2)
51.13
%
42.16
%
Common stock dividend payout ratio
26.97
%
17.21
%
(1)
Reconciliations of the non–GAAP measures
are set forth at the end of this press release.
(2)
Ratio calculated by dividing noninterest
expense by the sum of net interest income before provision for
credit losses and noninterest income.
RBB BANCORP AND
SUBSIDIARIES
SELECTED FINANCIAL
HIGHLIGHTS
(Unaudited)
(Dollars in thousands)
As of
September 30,
June 30,
September 30,
2023
2023
2022
Credit Quality Data:
Loans 30-89 days past due
$
19,662
$
7,242
$
39,938
Loans 30-89 days past due to total
loans
0.63
%
0.23
%
1.24
%
Nonperforming loans
$
40,146
$
41,609
$
11,503
Nonperforming loans to total loans
1.29
%
1.30
%
0.36
%
Nonperforming assets
$
40,430
$
42,186
$
11,796
Nonperforming assets to total assets
0.99
%
1.04
%
0.30
%
Special mention loans
$
31,212
$
24,150
$
21,569
Special mention loans to total loans
1.00
%
0.76
%
0.67
%
Substandard loans
$
71,401
$
74,065
$
52,118
Substandard loans to total loans
2.29
%
2.32
%
1.62
%
Allowance for credit losses to total
loans
1.36
%
1.35
%
1.12
%
Allowance for credit losses to
nonperforming loans
105.69
%
102.94
%
313.37
%
Net charge-offs (recoveries)
$
2,206
$
580
$
(127
)
Net charge-offs to average loans (for the
quarter-to-date period)
0.28
%
0.07
%
-0.02
%
Capital ratios
Tangible common equity to tangible assets
(1)
10.80
%
10.64
%
10.35
%
Tier 1 leverage ratio
11.77
%
11.60
%
11.47
%
Tier 1 common capital to risk-weighted
assets
17.78
%
16.91
%
15.52
%
Tier 1 capital to risk-weighted assets
18.36
%
17.46
%
16.06
%
Total capital to risk-weighted assets
26.37
%
25.27
%
23.72
%
(1)
Reconciliations of the non-GAAP measures
are set forth at the end of this press release.
RBB BANCORP AND
SUBSIDIARIES
SELECTED FINANCIAL
HIGHLIGHTS
(Unaudited)
Loan Portfolio Detail
As of September 30,
2023
As of June 30, 2023
As of September 30,
2022
(dollars in thousands)
$
%
$
%
$
%
Loans:
Commercial and industrial
$
127,655
4.1
%
$
131,456
4.1
%
$
204,817
6.4
%
SBA
50,420
1.6
%
53,459
1.7
%
61,934
1.9
%
Construction and land development
259,778
8.3
%
256,916
8.0
%
353,473
11.0
%
Commercial real estate (1)
1,164,210
37.3
%
1,183,396
37.0
%
1,220,791
37.9
%
Single-family residential mortgages
1,505,307
48.2
%
1,554,713
48.7
%
1,356,342
42.1
%
Other loans
13,582
0.5
%
16,055
0.5
%
23,556
0.7
%
Total loans (2)
$
3,120,952
100.0
%
$
3,195,995
100.0
%
$
3,220,913
100.0
%
Allowance for credit losses
(42,430
)
(43,092
)
(36,047
)
Total loans, net
$
3,078,522
$
3,152,903
$
3,184,866
(1)
Includes non-farm and non-residential
loans, multi-family residential loans and non-owner occupied single
family residential loans.
(2)
Net of discounts and deferred fees and
costs.
Non-GAAP Financial Measures
Tangible Book Value Reconciliations
The tangible book value per share is a non-GAAP disclosure.
Management measures the tangible book value per share to assess the
Company’s capital strength and business performance and believes
these are helpful to investors as additional tool for further
understanding our performance. The following is a reconciliation of
tangible book value to the Company shareholders’ equity computed in
accordance with GAAP, as well as a calculation of tangible book
value per share as of September 30, 2023, June 30, 2023, and
September 30, 2022.
(dollars in thousands, except share and
per share data)
September 30, 2023
June 30, 2023
September 30, 2022
Tangible common equity:
Total shareholders' equity
$
506,003
$
500,290
$
471,799
Adjustments
Goodwill
(71,498
)
(71,498
)
(71,498
)
Core deposit intangible
(3,010
)
(3,246
)
(3,971
)
Tangible common equity
$
431,495
$
425,546
$
396,330
Tangible assets:
Total assets-GAAP
$
4,069,354
$
4,075,618
$
3,905,229
Adjustments
Goodwill
(71,498
)
(71,498
)
(71,498
)
Core deposit intangible
(3,010
)
(3,246
)
(3,971
)
Tangible assets
$
3,994,846
$
4,000,874
$
3,829,760
Common shares outstanding
18,995,303
18,995,303
19,011,672
Tangible common equity to tangible assets
ratio
10.80
%
10.64
%
10.35
%
Book value per share
$
26.64
$
26.34
$
24.82
Tangible book value per share
$
22.72
$
22.40
$
20.85
Return on Average Tangible Common Equity
Management measures return on average tangible common equity
(“ROATCE”) to assess the Company’s capital strength and business
performance and believes these are helpful to investors as an
additional tool for further understanding our performance. Tangible
equity excludes goodwill and other intangible assets (excluding
mortgage servicing rights), and is reviewed by banking and
financial institution regulators when assessing a financial
institution’s capital adequacy. This non-GAAP financial measure
should not be considered a substitute for operating results
determined in accordance with GAAP and may not be comparable to
other similarly titled measures used by other companies. The
following table reconciles ROATCE to its most comparable GAAP
measure:
Three Months Ended
Nine Months Ended
September 30,
September 30,
(dollars in thousands)
2023
2022
2023
2022
Net income available to common
shareholders
$
11,965
$
16,652
$
33,884
$
46,746
Average shareholders' equity
504,470
474,106
498,988
470,548
Adjustments:
Goodwill
(71,498
)
(71,498
)
(71,498
)
(70,763
)
Core deposit intangible
(3,165
)
(4,154
)
(3,398
)
(4,215
)
Adjusted average tangible common
equity
$
429,807
$
398,454
$
424,092
$
395,570
Return on average tangible common
equity
11.04
%
16.58
%
10.68
%
15.80
%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231023803056/en/
Alex Ko, Chief Financial Officer (213) 533-7919
Alexko@rbbusa.com
Grafico Azioni RBB Bancorp (NASDAQ:RBB)
Storico
Da Nov 2024 a Dic 2024
Grafico Azioni RBB Bancorp (NASDAQ:RBB)
Storico
Da Dic 2023 a Dic 2024
