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Press Release

RBB Bancorp Reports Fourth Quarter and Full Year Earnings for 2020

January 25, 2021 at 4:15 PM EST

Conference Call and Webcast Scheduled for Tuesday, January 26, 2021 at 11:00 a.m. Pacific Time/2:00 p.m. Eastern Time

Fourth Quarter 2020 Highlights

  • Net income of $11.1 million, or $ 0.56 diluted earnings per share, increased $2.6 million, or 30.8%, from the prior quarter and increased $474,000, or 4.4%, from the fourth quarter of 2019
  • Total deposits (excluding brokered deposits) increased by $23.4 million, or 3.6% annualized growth, from the end of the prior quarter
  • Net interest margin of 3.7% increased by 8 basis points from the prior quarter and increased 20 basis points from the fourth quarter of 2019

LOS ANGELES--(BUSINESS WIRE)--Jan. 25, 2021-- 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 December 31, 2020.

The Company reported net income of $11.1 million, or $ 0.56 diluted earnings per share, for the three months ended December 31, 2020, compared to net income of $8.5 million, or $ 0.43 diluted earnings per share, and $10.7 million, or $0.52 diluted earnings per share, for the three months ended September 30, 2020 and December 31, 2019, respectively.

“Royal Business Bank finished 2020 with strong fourth quarter results, concluding a challenging year that demonstrated the resilience of our differentiated business model,” said Mr. Alan Thian, Chairman, President and CEO of RBB Bancorp. “Fourth quarter earnings benefitted from an increase in our net interest margin and gains on loan sales. Higher than anticipated loan payoffs resulted in a modest reduction in our loan portfolio following the strong growth we saw in the third quarter. We anticipate returning to loan growth in the first quarter. Our asset quality remains solid and we remain well capitalized with ample access to liquidity. Loans modified under the CARES Act outstanding continue to decrease and now represent 1.8% of gross loans outstanding.”

"Our board of directors approved a quarterly dividend of $0.12 per share, as clarity on our future performance improved," Mr. Thian concluded.

Key Performance Ratios

Net income of $11.1 million for the fourth quarter of 2020 produced an annualized return on average assets of 1.33%, an annualized return on average tangible common shareholders’ equity of 12.58%, and an annualized return on average shareholders’ equity of 10.38%. This compares to an annualized return on average assets of 1.05%, an annualized return on average tangible common shareholders’ equity of 9.81%, and an annualized return on average shareholders’ equity of 8.06% for the third quarter of 2020. The efficiency ratio for the fourth quarter of 2020 was 43.32%, compared to 46.63% for the prior quarter. The improvement in the efficiency ratio was primarily due to improved net interest income and non-interest income.

Net Interest Income and Net Interest Margin

Net interest income, before provision for loan losses, was $28.9 million for the fourth quarter of 2020, compared to $27.3 million for the third quarter of 2020. The $1.6 million increase was primarily attributable to a $114.1 million increase in average earning assets and a $21.5 million increase in average noninterest-bearing deposits, partially offset by a $73.6 million increase in average interest-bearing liabilities. Net interest income was also favorably impacted by an 8 basis point increase in the net interest margin. Accretion of purchase discounts from prior acquisitions contributed $275,000 to net interest income in the fourth quarter of 2020, compared to $634,000 in the third quarter of 2020.

Compared to the fourth quarter of 2019, net interest income, before provision for loan losses, increased $5.8 million from $23.1 million. The increase was primarily attributable to a $492.4 million increase in average earning assets and a $170.9 million increase in average noninterest-bearing deposits, partially offset by a $331.5 million increase in average interest-bearing liabilities. The increases in average earning assets and total deposits were primarily due to the Pacific Global Bank (“PGB”) acquisition, and increased loan and deposit originations.

Net interest margin was 3.67% for the fourth quarter of 2020, an increase of 8 basis points from 3.59% in the third quarter of 2020. The increase was primarily attributable to a 16 basis point decrease in the cost of total deposits and a 13 basis point decrease in the cost of borrowings (FHLB advances, long-term debt and subordinated debentures), partially offset by an 8 basis point decrease in the yield on average earning assets. Loan discount accretion contributed 3 basis points to the net interest margin in the fourth quarter of 2020, compared to 8 basis points in the third quarter of 2020.

Noninterest Income

Noninterest income was $4.5 million for the fourth quarter of 2020, an increase of $1.8 million from $2.7 million in the third quarter of 2020. The increase was driven by an increase in gain on loan sales of $1.7 million as the Company sold $30.6 million more loans in the fourth quarter than in the prior quarter generally due to increased market activity following the initial impact of the COVID-19 pandemic.

The Company sold $24.7 million in FNMA qualified mortgage loans for a net gain of $645,000 and sold $24.3 million in qualified and non-qualified mortgage loans to private investors for a gain of $1.2 million during the fourth quarter of 2020. This compared to $17.7 million in FNMA qualified mortgage loans for a net gain of $536,000 and $11.8 million in non-qualified mortgage loans to private investors for a gain of $224,000 during the third quarter of 2020. The Company sold $11.3 million in SBA loans during the fourth quarter of 2020 for a net gain of $595,000, compared to no SBA loans sold during the third quarter of 2020.

Compared to the fourth quarter of 2019, noninterest income decreased by $1.3 million from $5.8 million. The decrease was primarily attributable to a decrease of $1.3 million in gain on loan sales and a decrease of $611,000 in loan servicing fees.

Noninterest Expense

Noninterest expense for the fourth quarter of 2020 was $14.5 million, compared to $14.0 million for the third quarter of 2020. The $475,000 increase was primarily attributable to a $506,000 increase in compensation and employee benefits expenses, $164,000 increase in marketing and business promotion expenses, partially offset by a $188,000 decrease in data processing expenses, and a $153,000 decrease in insurance and regulatory assessments.

Noninterest expense increased from $13.5 million in the fourth quarter of 2019. The $988,000 increase was primarily due to a $515,000 increase in data processing expense, a $477,000 increase in legal and professional expense, and a $284,000 increase in salaries and employee benefits expenses. These were partially offset by a $226,000 decrease in merger and conversion expenses, and a $172,000 decrease in OREO expense.

Income Taxes

The effective tax rate was 29.92% for the fourth quarter of 2020, 29.81% for the third quarter of 2020, and 27.99% for the fourth quarter of 2019.

Loan Portfolio

Loans held for investment, net of deferred fees and discounts, totaled $2.7 billion as of December 31, 2020, a decrease of $48.4 million from September 30, 2020, and an increase of $509.8 million from December 31, 2019. The decrease from the prior quarter was primarily due to an increase in loan payoffs. Single-family residential mortgages decreased by $39.6 million net of payoffs, paydowns and loan sales. Commercial real estate loans increased by $28.5 million, construction and land development loans increased by $3.2 million, other loans increased by $758,000, SBA loans decreased by $13.4 million, and commercial and industrial loans decreased by $27.8 million.

During the fourth quarter of 2020, single-family residential mortgage production was $110.3 million (mortgage loans held for investment and held for sale), payoffs and paydowns were $74.5 million, and single-family residential mortgage loan sales were $49.3 million. During the third quarter of 2020, single-family residential mortgage production was $82.6 million, payoffs and paydowns were $45.7 million, and loan sales were $49.0 million.

Mortgage loans held for sale were $50.0 million as of December 31, 2020, an increase of $26.1 million from $23.9 million at September 30, 2020 and a decrease of $58.2 million from $108.2 million as of December 31, 2019. The Company originated approximately $50.0 million in mortgage loans for sale for the fourth quarter of 2020, compared with $28.7 million during the prior quarter. In the fourth quarter, SBA loan production was $5.8 million and total loan sales were $11.1 million.

Deposits

Deposits were $2.6 billion at December 31, 2020, an increase of $23.4 million from September 30, 2020, and an increase of $432.9 million from December 31, 2019, excluding brokered deposits. The increase in total deposits from the prior quarter was primarily attributable to organic deposit growth. Noninterest-bearing deposits decreased by $25.1 million and interest-bearing non-maturity deposits increased by $76.7 million. Time deposits decreased by $28.2 million. As of December 31, 2020, time deposits included $17.4 million in brokered CDs, as compared to $17.4 million as of September 30, 2020 and $67.1 million as of December 31, 2019.

Asset Quality

Nonperforming assets totaled $19.8 million, or 0.59% of total assets at December 31, 2020, compared to $18.3 million, or 0.54%, of total assets at September 30, 2020. The increase in nonperforming assets was primarily due to an increase in non-accrual loans. Nonperforming assets consist of OREO, loans modified under troubled debt restructurings (“TDR”), non-accrual loans, and loans past due 90 days or more and still accruing interest.

Loans held-for-investment 30 to 89 days past due decreased by $12.8 million to $8.9 million at December 31, 2020 from $21.7 million at September 30, 2020.

In the fourth quarter of 2020, there were $305,000 in net charge-offs, up from $47,000 in the prior quarter.

The Company recorded a provision for credit losses of $3.0 million for the fourth quarter of 2020, a decrease from $3.9 million in the prior quarter, primarily attributable to lower loan balances.

The allowance for loan losses totaled $29.3 million, or 1.08% of loans held for investment at December 31, 2020, compared with $26.6 million, or 0.97%, of total loans at September 30, 2020.

As of December 31, 2020, borrowers representing 256 loans totaling $32.9 million, or 1.2% of the Company’s total loan portfolio, have funded under the SBA’s Paycheck Protection Program due to the COVID-19 pandemic.

We have received 14 requests for payment deferments from our SBA customers. All SBA deferments are three-months, 13 of which started in October 2020. As of January 15, 2021 none of the SBA borrowers have made a payment due to waiting on new SBA payment support program that was part of the recent stimulus bill. The following table details the 14 SBA loan deferments:

 

 

Requested SBA Loan Deferments

 

 

 

Number

 

 

Principal Amount ($000)

 

 

Principal Amount Average LTV%

 

 

Guaranteed Amount ($000)

 

 

Unguaranteed Amount ($000)

 

 

Unguaranteed Amount to Total SBA Loans

 

Hospitality

 

 

7

 

 

$

29,591

 

 

 

75

%

 

$

22,193

 

 

$

7,398

 

 

 

7.6

%

General retail

 

 

2

 

 

 

3,195

 

 

 

72

%

 

 

2,396

 

 

 

799

 

 

 

0.8

%

Restaurant

 

 

1

 

 

 

1,846

 

 

 

75

%

 

 

1,384

 

 

 

461

 

 

 

0.5

%

Transportation

 

 

3

 

 

 

1,042

 

 

 

30

%

 

 

782

 

 

 

261

 

 

 

0.3

%

Fitness

 

 

1

 

 

 

101

 

 

 

0

%

 

 

86

 

 

 

15

 

 

 

0.0

%

 

 

 

14

 

 

$

35,775

 

 

 

 

 

 

$

26,841

 

 

$

8,934

 

 

 

9.1

%

The following table provides details regarding the Company's COVID-19 loan deferral activity through January 15, 2021.

 

 

As of June 30, 2020

 

 

As of October 23, 2020

 

 

As of January 15, 2021

 

 

 

Loans Deferred

 

 

Loans Deferred

 

 

Loans Deferred

 

 

 

Number

 

 

Principal Amount
($000)

 

 

Number

 

 

Principal Amount
($000)

 

 

Number

 

 

Principal Amount
($000)

 

General retail (excluding SBA)

 

 

34

 

 

$

94,251

 

 

 

3

 

 

$

26,840

 

 

 

2

 

 

$

3,174

 

Mixed use commercial

 

 

38

 

 

 

58,841

 

 

 

4

 

 

 

10,547

 

 

 

1

 

 

 

7,500

 

Hospitality (excluding SBA) (1)

 

 

5

 

 

 

25,343

 

 

 

2

 

 

 

12,929

 

 

 

1

 

 

 

6,419

 

Restaurants (excluding SBA)

 

 

11

 

 

 

4,186

 

 

 

1

 

 

 

12

 

 

 

 

 

 

 

Multifamily

 

 

6

 

 

 

9,086

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial, office and other (1)

 

 

6

 

 

 

22,983

 

 

 

5

 

 

 

19,881

 

 

 

5

 

 

 

18,742

 

SFR mortgage loans - Western region

 

 

183

 

 

 

118,484

 

 

 

38

 

 

 

29,604

 

 

 

14

 

 

 

8,770

 

SFR mortgage loans - Eastern region

 

 

203

 

 

 

85,935

 

 

 

10

 

 

 

4,106

 

 

 

11

 

 

 

4,925

 

SFR mortgage loans - Chicago metropolitan

 

 

84

 

 

 

14,824

 

 

 

4

 

 

 

719

 

 

 

1

 

 

 

249

 

Total

 

 

570

 

 

$

433,933

 

 

 

67

 

 

$

104,638

 

 

 

35

 

 

$

49,779

 

(1) Loans with a principal amount of $23.5 million are principal deferments only. Interest is paid up to date.

The Company does not have any shared national credits or loans, backed by airlines or cruise lines, on deferral as of January 15, 2021.

Properties

In October 2020, we closed the Flushing Financial Center branch and consolidated operations into our Roosevelt branch location.

The Bank opened a new full service banking branch in Edison, New Jersey on December 1, 2020. The branch is located at 561 US-1, in the Wicks Shopping Plaza in Edison. The Bank purchased a property located at 2057 86th Street, Brooklyn, New York, in the Bensonhurst neighborhood, to house a full-service branch. We expect this branch to open in the second half of 2021. The Bank has leased a location on Canal Street in Manhattan to which to move our Bowery Street branch in mid-2021.

Corporate Overview

RBB Bancorp is a community-based financial holding company headquartered in Los Angeles, California. The Company has total assets of $3.3 billion. Its wholly-owned subsidiary, Royal Business Bank is a full service commercial bank, which provides business banking services to the Chinese-American communities in Los Angeles County, Orange County and Ventura County in California, in Las Vegas, Nevada, in Brooklyn, Queens, and Manhattan in New York, and three branches in the Chicago neighborhoods of Chinatown and Bridgeport, and Edison, New Jersey. 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 Irvine, California, one branch in Las Vegas, Nevada, six branches and one loan operation center in Brooklyn, Queens and Manhattan in New York, three branches in Chicago, Illinois and one branch in Edison, New Jersey. 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 Avenue, 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 tomorrow, January 26, 2021, to discuss the Company’s fourth quarter 2020 financial results.

To listen to the conference call, please dial 1-833-519-1355 or 1-918-922-6505, passcode 5947189. A replay of the call will be made available at 1-800-585-8367 or 1-404-537-3406, passcode 5947189, approximately one hour after the conclusion of the call and will remain available through February 2, 2021.

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, local, regional, national and international economic and market conditions and events and the impact they may have on us, our customers and our assets and liabilities; our ability to attract deposits and other sources of funding or liquidity; supply and demand for real estate and periodic deterioration in real estate prices and/or values in California or other states where we lend, including both residential and commercial real estate; a prolonged slowdown or decline in real estate construction, sales or leasing activities; changes in the financial performance and/or condition of our borrowers, depositors or key vendors or counterparties; changes in our levels of delinquent loans, nonperforming assets, allowance for loan losses and charge-offs; expectations regarding the impact of the COVID-19 pandemic; the costs or effects of acquisitions or dispositions we may make, including our recent acquisition of PGB Holdings, Inc. and its wholly-owned subsidiary, Pacific Global Bank, and our recently completed acquisition of First American International Corp., whether we are able to obtain any required governmental or shareholder approvals in connection with any such acquisitions or dispositions, and/or our ability to realize the contemplated financial or business benefits associated with any such acquisitions or dispositions; the effect of changes in laws, regulations and applicable judicial decisions (including laws, regulations and judicial decisions concerning financial reforms, taxes, banking capital levels, consumer, commercial or secured lending, securities and securities trading and hedging, compliance, employment, executive compensation, insurance, vendor management and information security) with which we and our subsidiaries must comply or believe we should comply; changes in estimates of future reserve requirements and minimum capital requirements based upon the periodic review thereof under relevant regulatory and accounting requirements, including changes in the Basel Committee framework establishing capital standards for credit, operations and market risk; inflation, interest rate, securities market and monetary fluctuations; changes in government interest rates or monetary policies; changes in the amount and availability of deposit insurance; cyber-security threats, including loss of system functionality or theft or loss of Company or customer data or money; political instability; acts of war or terrorism, or natural disasters, such as earthquakes, drought, or the effects of pandemic diseases; the timely development and acceptance of new banking products and services and the perceived overall value of these products and services by our customers and potential customers; the Company’s relationships with and reliance upon vendors with respect to the operation of certain of the Company’s key internal and external systems and applications; changes in commercial or consumer spending, borrowing and savings preferences or behaviors; technological changes and the expanding use of technology in banking (including the adoption of mobile banking and funds transfer applications); the ability to retain and increase market share, retain and grow customers and control expenses; changes in the competitive and regulatory environment among financial and bank holding companies, banks and other financial service providers; volatility in the credit and equity markets and its effect on the general economy or local or regional business conditions; fluctuations in the price of the Company’s common stock or other securities; and the resulting impact on the Company’s ability to raise capital or make acquisitions, the effect of changes in accounting policies and practices, as may be adopted from time-to-time by our regulatory agencies, as well as by the Public Company Accounting Oversight Board, the Financial Accounting Standards Board and other accounting standard-setters, including ASU 2016-13 (Topic 326), “Measurement of Credit Losses on Financial Instruments”, commonly referenced as the Current Expected Credit Loss (“CECL”) model, which will change how we estimate credit losses and may increase the required level of our allowance for credit losses after adoption; changes in our organization, management, compensation and benefit plans, and our ability to retain or expand our workforce, management team and/or our board of directors; the costs and effects of legal, compliance and regulatory actions, changes and developments, including the initiation and resolution of legal proceedings (such as securities, consumer or employee class action litigation), regulatory or other governmental inquiries or investigations, and/or the results of regulatory examinations or reviews; our ongoing relations with our various federal and state regulators, including the SEC, FDIC, FRB and California DFPI (formerly DBO); 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 for the year ended December 31, 2019, 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, except for December 31, 2019)

(Dollars in thousands)

 

 

 

December 31

 

September 30

 

June 30

 

March 31

 

December 31

 

 

2020

 

2020

 

2020

 

2019

 

2019

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

 

$

137,654

 

 

$

121,630

 

 

$

94,844

 

 

$

250,079

 

 

$

114,763

 

Federal funds sold and other cash equivalents

 

 

57,000

 

 

 

57,000

 

 

 

57,000

 

 

 

 

 

 

67,000

 

Total cash and cash equivalents

 

 

194,654

 

 

 

178,630

 

 

 

151,844

 

 

 

250,079

 

 

 

181,763

 

Interest-bearing deposits in other financial institutions

 

 

600

 

 

 

600

 

 

 

600

 

 

 

1,196

 

 

 

600

 

Investment securities available for sale

 

 

210,867

 

 

 

214,662

 

 

 

185,756

 

 

 

58,537

 

 

 

126,069

 

Investment securities held to maturity

 

 

7,174

 

 

 

7,569

 

 

 

7,615

 

 

 

9,449

 

 

 

8,332

 

Mortgage loans held for sale

 

 

49,963

 

 

 

23,886

 

 

 

15,479

 

 

 

375,430

 

 

 

108,194

 

Loans held for investment

 

 

2,706,766

 

 

 

2,755,153

 

 

 

2,594,620

 

 

 

2,120,413

 

 

 

2,196,934

 

Allowance for loan losses

 

 

(29,337

)

 

 

(26,634

)

 

 

(22,820

)

 

 

(18,236

)

 

 

(18,816

)

Net loans held for investment

 

 

2,677,429

 

 

 

2,728,519

 

 

 

2,571,800

 

 

 

2,102,177

 

 

 

2,178,118

 

Premises and equipment, net

 

 

27,103

 

 

 

24,237

 

 

 

23,965

 

 

 

17,342

 

 

 

16,813

 

Federal Home Loan Bank (FHLB) stock

 

 

15,641

 

 

 

15,641

 

 

 

15,641

 

 

 

8,899

 

 

 

15,000

 

Net deferred tax assets

 

 

2,547

 

 

 

1,080

 

 

 

 

 

 

4,389

 

 

 

2,326

 

Cash surrender value of life insurance

 

 

35,121

 

 

 

34,930

 

 

 

34,736

 

 

 

33,769

 

 

 

34,353

 

Goodwill

 

 

69,243

 

 

 

69,243

 

 

 

69,209

 

 

 

58,383

 

 

 

58,563

 

Servicing assets

 

 

13,965

 

 

 

14,724

 

 

 

15,595

 

 

 

17,288

 

 

 

17,083

 

Core deposit intangibles

 

 

5,196

 

 

 

5,519

 

 

 

5,876

 

 

 

7,212

 

 

 

6,100

 

Accrued interest and other assets

 

 

40,569

 

 

 

40,336

 

 

 

38,065

 

 

 

33,968

 

 

 

35,221

 

Total assets

 

$

3,350,072

 

 

$

3,359,576

 

 

$

3,136,181

 

 

$

2,978,118

 

 

$

2,788,535

 

Liabilities and shareholders' equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing demand

 

$

617,206

 

 

$

642,332

 

 

$

574,553

 

 

$

418,953

 

 

$

458,763

 

Savings, NOW and money market accounts

 

 

731,084

 

 

 

654,378

 

 

 

601,941

 

 

 

480,959

 

 

 

537,490

 

Time deposits

 

 

1,286,838

 

 

 

1,315,038

 

 

 

1,260,026

 

 

 

1,284,428

 

 

 

1,252,685

 

Total deposits

 

 

2,635,128

 

 

 

2,611,748

 

 

 

2,436,520

 

 

 

2,184,340

 

 

 

2,248,938

 

FHLB advances

 

 

150,000

 

 

 

190,000

 

 

 

150,000

 

 

 

275,000

 

 

 

 

Long-term debt, net of debt issuance costs

 

 

104,391

 

 

 

104,305

 

 

 

104,220

 

 

 

103,793

 

 

 

104,049

 

Subordinated debentures

 

 

14,283

 

 

 

14,229

 

 

 

14,174

 

 

 

9,548

 

 

 

9,673

 

Accrued interest and other liabilities

 

 

17,782

 

 

 

17,878

 

 

 

17,242

 

 

 

20,634

 

 

 

18,185

 

Total liabilities

 

 

2,921,584

 

 

 

2,938,160

 

 

 

2,722,156

 

 

 

2,593,315

 

 

 

2,380,845

 

Shareholders' equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shareholder's equity

 

 

427,287

 

 

 

420,329

 

 

 

412,827

 

 

 

385,395

 

 

 

407,379

 

Non-controlling interest

 

 

72

 

 

 

72

 

 

 

72

 

 

 

72

 

 

 

72

 

Accumulated other comprehensive income - Net of tax

 

 

1,129

 

 

 

1,015

 

 

 

1,126

 

 

 

(664

)

 

 

239

 

Total shareholders' equity

 

 

428,488

 

 

 

421,416

 

 

 

414,025

 

 

 

384,803

 

 

 

407,690

 

Total liabilities and shareholders’ equity

 

$

3,350,072

 

 

$

3,359,576

 

 

$

3,136,181

 

 

$

2,978,118

 

 

$

2,788,535

 

RBB BANCORP AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

(Dollars in thousands, except per share amounts) 

 

 

 

For the three months ended

 

 

December 31, 2020

 

 

September 30, 2020

 

 

December 31, 2019

Interest and dividend income:

 

 

 

 

 

 

 

 

 

 

 

Interest and fees on loans

 

$

34,832

 

 

$

34,153

 

 

$

32,178

 

Interest on interest-bearing deposits

 

 

55

 

 

 

61

 

 

 

373

 

Interest on investment securities

 

 

639

 

 

 

621

 

 

 

676

 

Dividend income on FHLB stock

 

 

193

 

 

 

190

 

 

 

264

 

Interest on federal funds sold and other

 

 

145

 

 

 

100

 

 

 

416

 

Total interest income

 

 

35,864

 

 

 

35,125

 

 

 

33,907

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

Interest on savings deposits, NOW and money market accounts

 

 

736

 

 

 

779

 

 

 

1,237

 

Interest on time deposits

 

 

3,900

 

 

 

4,746

 

 

 

7,559

 

Interest on subordinated debentures and long term debt

 

 

1,901

 

 

 

1,905

 

 

 

1,915

 

Interest on other borrowed funds

 

 

450

 

 

 

444

 

 

 

73

 

Total interest expense

 

 

6,987

 

 

 

7,874

 

 

 

10,784

 

Net interest income before provision for loan losses

 

 

28,877

 

 

 

27,251

 

 

 

23,123

 

Provision for loan losses

 

 

3,008

 

 

 

3,861

 

 

 

659

 

Net interest income after provision for loan losses

 

 

25,869

 

 

 

23,390

 

 

 

22,464

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

Service charges, fees and other

 

 

1,565

 

 

 

1,143

 

 

 

1,096

 

Gain on sale of loans

 

 

2,445

 

 

 

760

 

 

 

3,762

 

Loan servicing fees, net of amortization

 

 

206

 

 

 

546

 

 

 

817

 

Recoveries on loans acquired in business combinations

 

 

5

 

 

 

32

 

 

 

70

 

Gain on derivatives

 

 

78

 

 

 

 

 

 

 

Increase in cash surrender value of life insurance

 

 

191

 

 

 

194

 

 

 

195

 

Gain on sale of securities

 

 

 

 

 

52

 

 

 

 

(Loss)/Gain on sale of other real estate owned

 

 

 

 

 

 

 

 

(117

)

Total noninterest income

 

 

4,490

 

 

 

2,727

 

 

 

5,823

 

Noninterest expense:

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

 

8,105

 

 

 

7,599

 

 

 

7,821

 

Occupancy and equipment expenses

 

 

2,400

 

 

 

2,360

 

 

 

2,390

 

Data processing

 

 

1,012

 

 

 

1,200

 

 

 

497

 

Legal and professional

 

 

794

 

 

 

675

 

 

 

317

 

Office expenses

 

 

295

 

 

 

271

 

 

 

292

 

Marketing and business promotion

 

 

295

 

 

 

131

 

 

 

382

 

Insurance and regulatory assessments

 

 

210

 

 

 

363

 

 

 

147

 

Core deposit premium

 

 

324

 

 

 

357

 

 

 

344

 

OREO expenses

 

 

4

 

 

 

3

 

 

 

176

 

Merger and conversion expenses

 

 

5

 

 

 

62

 

 

 

231

 

Other expenses

 

 

1,009

 

 

 

957

 

 

 

868

 

Total noninterest expense

 

 

14,453

 

 

 

13,978

 

 

 

13,465

 

Income before income taxes

 

 

15,906

 

 

 

12,139

 

 

 

14,822

 

Income tax expense

 

 

4,759

 

 

 

3,619

 

 

 

4,149

 

Net income

 

$

11,147

 

 

$

8,520

 

 

$

10,673

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income per share

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.57

 

 

$

0.43

 

 

$

0.53

 

Diluted

 

$

0.56

 

 

$

0.43

 

 

$

0.52

 

Cash Dividends declared per common share

 

$

0.09

 

 

$

0.06

 

 

$

0.10

 

Weighted-average common shares outstanding

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

19,655,621

 

 

 

19,717,568

 

 

 

20,001,916

 

Diluted

 

 

19,812,401

 

 

 

19,804,892

 

 

 

20,389,099

 

RBB BANCORP AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited, except for December 31, 2019)

(Dollars in thousands, except per share amounts)

 

 

 

For the twelve months ended

 

 

December 31, 2020

 

 

December 31, 2019

Interest and dividend income:

 

 

 

 

 

 

 

Interest and fees on loans

 

$

133,894

 

 

$

135,159

 

Interest on interest-earning deposits

 

 

641

 

 

 

1,785

 

Interest on investment securities

 

 

2,968

 

 

 

2,652

 

Dividend income on FHLB stock

 

 

572

 

 

 

1,079

 

Interest on federal funds sold and other

 

 

1,045

 

 

 

1,050

 

Total interest income

 

 

139,120

 

 

 

141,725

 

Interest expense:

 

 

 

 

 

 

 

Interest on savings deposits, NOW and money market accounts

 

 

3,540

 

 

 

4,886

 

Interest on time deposits

 

 

21,665

 

 

 

29,347

 

Interest on subordinated debentures and long term debt

 

 

7,677

 

 

 

7,698

 

Interest on other borrowed funds

 

 

1,483

 

 

 

2,930

 

Total interest expense

 

 

34,365

 

 

 

44,861

 

Net interest income

 

 

104,755

 

 

 

96,864

 

Provision for loan losses

 

 

11,823

 

 

 

2,390

 

Net interest income after provision for loans losses

 

 

92,932

 

 

 

94,474

 

Noninterest income:

 

 

 

 

 

 

 

Service charges, fees and other

 

 

4,852

 

 

 

4,072

 

Gain on sale of loans

 

 

5,997

 

 

 

9,893

 

Loan servicing fees, net of amortization

 

 

2,052

 

 

 

3,383

 

Recoveries on loans acquired in business combinations

 

 

84

 

 

 

143

 

Unrealized gain on equity investments

 

 

 

 

 

147

 

Increase in cash surrender value of life insurance

 

 

767

 

 

 

775

 

Gain on derivatives

 

 

78

 

 

 

 

Gain on sale of securities

 

 

210

 

 

 

7

 

Gain on sale of fixed assets

 

 

 

 

 

6

 

Loss on sale of other real estate owned

 

 

 

 

 

(106

)

Total noninterest income

 

 

14,040

 

 

 

18,320

 

Noninterest expense:

 

 

 

 

 

 

 

Salaries and employee benefits

 

 

33,312

 

 

 

32,909

 

Occupancy and equipment expenses

 

 

9,691

 

 

 

9,750

 

Data processing

 

 

4,236

 

 

 

3,699

 

Legal and professional

 

 

2,743

 

 

 

1,832

 

Office expenses

 

 

1,226

 

 

 

1,257

 

Marketing and business promotion

 

 

751

 

 

 

1,308

 

Insurance and regulatory assessments

 

 

984

 

 

 

900

 

Core deposit premium

 

 

1,395

 

 

 

1,501

 

OREO expenses

 

 

35

 

 

 

337

 

Merger expenses

 

 

746

 

 

 

471

 

Other expenses

 

 

4,394

 

 

 

3,509

 

Total noninterest expense

 

 

59,513

 

 

 

57,473

 

Income before income taxes

 

 

47,459

 

 

 

55,321

 

Income tax expense

 

 

14,531

 

 

 

16,112

 

Net income

 

$

32,928

 

 

$

39,209

 

 

 

 

 

 

 

 

 

Net income per share

 

 

 

 

 

 

 

Basic

 

$

1.66

 

 

$

1.96

 

Diluted

 

$

1.65

 

 

$

1.92

 

Cash Dividends declared per common share

 

$

0.33

 

 

$

0.40

 

Weighted-average common shares outstanding

 

 

 

 

 

 

 

Basic

 

 

19,763,422

 

 

 

20,017,306

 

Diluted

 

 

19,921,859

 

 

 

20,393,424

 

RBB BANCORP AND SUBSIDIARIES

AVERAGE BALANCE SHEET AND NET INTEREST INCOME

(Unaudited)

(Dollars in thousands, except per share amounts)

 

 

 

For the three months ended

 

 

December 31, 2020

 

September 30, 2020

 

December 31, 2019

 

 

Average

 

 

Interest

 

 

Yield /

 

Average

 

 

Interest

 

 

Yield /

 

Average

 

 

Interest

 

 

Yield /

(tax-equivalent basis, dollars in thousands)

 

Balance

 

 

& Fees

 

 

Rate

 

Balance

 

 

& Fees

 

 

Rate

 

Balance

 

 

& Fees

 

 

Rate

Earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal funds sold, cash equivalents & other (1)

 

$

188,430

 

 

$

393

 

 

 

0.83

%

 

$

179,521

 

 

$

351

 

 

 

0.78

%

 

$

172,431

 

 

$

1,053

 

 

 

2.42

%

Securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Available for sale

 

 

222,762

 

 

 

579

 

 

 

1.03

%

 

 

168,151

 

 

 

558

 

 

 

1.32

%

 

 

94,400

 

 

 

605

 

 

 

2.54

%

Held to maturity (2)

 

 

7,383

 

 

 

68

 

 

 

3.66

%

 

 

7,604

 

 

 

71

 

 

 

3.71

%

 

 

8,441

 

 

 

80

 

 

 

3.76

%

Mortgage loans held for sale

 

 

41,265

 

 

 

325

 

 

 

3.13

%

 

 

19,848

 

 

 

171

 

 

 

3.43

%

 

 

244,706

 

 

 

2,969

 

 

 

4.81

%

Loans held for investment: (3)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Real estate

 

 

2,282,937

 

 

 

29,705

 

 

 

5.18

%

 

 

2,266,752

 

 

 

29,616

 

 

 

5.20

%

 

 

1,793,647

 

 

 

24,182

 

 

 

5.35

%

Commercial

 

 

390,980

 

 

 

4,802

 

 

 

4.89

%

 

 

377,789

 

 

 

4,366

 

 

 

4.60

%

 

 

327,765

 

 

 

5,027

 

 

 

6.08

%

Total loans

 

 

2,673,917

 

 

 

34,507

 

 

 

5.13

%

 

 

2,644,541

 

 

 

33,982

 

 

 

5.11

%

 

 

2,121,412

 

 

 

29,209

 

 

 

5.46

%

Total earning assets

 

 

3,133,757

 

 

$

35,872

 

 

 

4.55

%

 

 

3,019,665

 

 

$

35,133

 

 

 

4.63

%

 

 

2,641,390

 

 

$

33,916

 

 

 

5.09

%

Noninterest-earning assets

 

 

196,071

 

 

 

 

 

 

 

 

 

 

204,638

 

 

 

 

 

 

 

 

 

 

165,659

 

 

 

 

 

 

 

 

Total assets

 

$

3,329,828

 

 

 

 

 

 

 

 

 

$

3,224,303

 

 

 

 

 

 

 

 

 

$

2,807,049

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOW and money market deposits

 

$

566,695

 

 

$

704

 

 

 

0.49

%

 

$

514,271

 

 

$

748

 

 

 

0.58

%

 

$

416,380

 

 

$

1,189

 

 

 

1.13

%

Savings deposits

 

 

128,727

 

 

 

32

 

 

 

0.10

%

 

 

126,635

 

 

 

31

 

 

 

0.10

%

 

 

96,813

 

 

 

48

 

 

 

0.20

%

Time deposits

 

 

1,293,070

 

 

 

3,900

 

 

 

1.20

%

 

 

1,284,351

 

 

 

4,746

 

 

 

1.47

%

 

 

1,296,379

 

 

 

7,559

 

 

 

2.31

%

Total interest-bearing deposits

 

 

1,988,492

 

 

 

4,636

 

 

 

0.93

%

 

 

1,925,257

 

 

 

5,525

 

 

 

1.14

%

 

 

1,809,572

 

 

 

8,796

 

 

 

1.93

%

FHLB advances

 

 

161,957

 

 

 

450

 

 

 

1.11

%

 

 

151,739

 

 

 

444

 

 

 

1.16

%

 

 

14,348

 

 

 

73

 

 

 

2.02

%

Long-term debt

 

 

104,335

 

 

 

1,748

 

 

 

6.67

%

 

 

104,252

 

 

 

1,748

 

 

 

6.67

%

 

 

103,997

 

 

 

1,748

 

 

 

6.67

%

Subordinated debentures

 

 

14,248

 

 

 

153

 

 

 

4.27

%

 

 

14,195

 

 

 

157

 

 

 

4.40

%

 

 

9,648

 

 

 

167

 

 

 

6.87

%

Total interest-bearing liabilities

 

 

2,269,032

 

 

 

6,987

 

 

 

1.23

%

 

 

2,195,443

 

 

 

7,874

 

 

 

1.43

%

 

 

1,937,565

 

 

 

10,784

 

 

 

2.21

%

Noninterest-bearing liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing deposits

 

 

616,803

 

 

 

 

 

 

 

 

 

 

595,264

 

 

 

 

 

 

 

 

 

 

445,891

 

 

 

 

 

 

 

 

Other noninterest-bearing liabilities

 

 

16,830

 

 

 

 

 

 

 

 

 

 

13,270

 

 

 

 

 

 

 

 

 

 

19,851

 

 

 

 

 

 

 

 

Total noninterest-bearing liabilities

 

 

633,633

 

 

 

 

 

 

 

 

 

 

608,534

 

 

 

 

 

 

 

 

 

 

465,742

 

 

 

 

 

 

 

 

Shareholders' equity

 

 

427,163

 

 

 

 

 

 

 

 

 

 

420,326

 

 

 

 

 

 

 

 

 

 

403,742

 

 

 

 

 

 

 

 

Total liabilities and shareholders' equity

 

$

3,329,828

 

 

 

 

 

 

 

 

 

$

3,224,303

 

 

 

 

 

 

 

 

 

$

2,807,049

 

 

 

 

 

 

 

 

Net interest income / interest rate spreads

 

 

 

 

 

$

28,885

 

 

 

3.32

%

 

 

 

 

 

$

27,259

 

 

 

3.20

%

 

 

 

 

 

$

23,132

 

 

 

2.88

%

Net interest margin

 

 

 

 

 

 

 

 

 

 

3.67

%

 

 

 

 

 

 

 

 

 

 

3.59

%

 

 

 

 

 

 

 

 

 

 

3.47

%

(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)

(Dollars in thousands, except per share amounts)

 

 

 

For the twelve months ended

 

 

December 31, 2020

 

December 31, 2019

 

 

Average

 

 

Interest

 

 

Yield /

 

Average

 

 

Interest

 

 

Yield /

(tax-equivalent basis, dollars in thousands)

 

Balance

 

 

& Fees

 

 

Rate

 

Balance

 

 

& Fees

 

 

Rate

Earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal funds sold, cash equivalents & other (1)

 

$

212,594

 

 

$

2,257

 

 

 

1.06

%

 

$

135,133

 

 

$

3,914

 

 

 

2.90

%

Securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Available for sale

 

 

175,307

 

 

 

2,714

 

 

 

1.55

%

 

 

85,775

 

 

 

2,354

 

 

 

2.74

%

Held to maturity (2)

 

 

7,665

 

 

 

289

 

 

 

3.77

%

 

 

8,978

 

 

 

334

 

 

 

3.72

%

Mortgage loans held for sale

 

 

41,019

 

 

 

1,779

 

 

 

4.34

%

 

 

325,039

 

 

 

15,754

 

 

 

4.85

%

Loans held for investment: (3)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Real estate

 

 

2,176,695

 

 

 

113,966

 

 

 

5.24

%

 

 

1,767,923

 

 

 

97,024

 

 

 

5.49

%

Commercial

 

 

367,718

 

 

 

18,149

 

 

 

4.94

%

 

 

345,010

 

 

 

22,381

 

 

 

6.49

%

Total loans

 

 

2,544,413

 

 

 

132,115

 

 

 

5.19

%

 

 

2,112,933

 

 

 

119,405

 

 

 

5.65

%

Total earning assets

 

 

2,980,998

 

 

$

139,154

 

 

 

4.67

%

 

 

2,667,858

 

 

$

141,761

 

 

 

5.31

%

Noninterest-earning assets

 

 

204,617

 

 

 

 

 

 

 

 

 

 

167,324

 

 

 

 

 

 

 

 

Total assets

 

$

3,185,615

 

 

 

 

 

 

 

 

 

$

2,835,182

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOW and money market deposits

 

$

504,905

 

 

$

3,391

 

 

 

0.67

%

 

$

395,376

 

 

$

4,689

 

 

 

1.19

%

Savings deposits

 

 

123,568

 

 

 

149

 

 

 

0.12

%

 

 

97,670

 

 

 

197

 

 

 

0.20

%

Time deposits

 

 

1,312,443

 

 

 

21,665

 

 

 

1.65

%

 

 

1,279,344

 

 

 

29,347

 

 

 

2.29

%

Total interest-bearing deposits

 

 

1,940,916

 

 

 

25,205

 

 

 

1.30

%

 

 

1,772,390

 

 

 

34,233

 

 

 

1.93

%

FHLB advances

 

 

129,071

 

 

 

1,483

 

 

 

1.15

%

 

 

114,388

 

 

 

2,930

 

 

 

2.56

%

Long-term debt

 

 

104,210

 

 

 

6,990

 

 

 

6.71

%

 

 

103,870

 

 

 

6,991

 

 

 

6.73

%

Subordinated debentures

 

 

14,228

 

 

 

687

 

 

 

4.83

%

 

 

9,586

 

 

 

707

 

 

 

7.38

%

Total interest-bearing liabilities

 

 

2,188,425

 

 

$

34,365

 

 

 

1.57

%

 

 

2,000,234

 

 

$

44,861

 

 

 

2.24

%

Noninterest-bearing liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing deposits

 

 

564,111

 

 

 

 

 

 

 

 

 

 

421,174

 

 

 

 

 

 

 

 

Other noninterest-bearing liabilities

 

 

15,164

 

 

 

 

 

 

 

 

 

 

19,879

 

 

 

 

 

 

 

 

Total noninterest-bearing liabilities

 

 

579,275

 

 

 

 

 

 

 

 

 

 

441,053

 

 

 

 

 

 

 

 

Shareholders' equity

 

 

417,915

 

 

 

 

 

 

 

 

 

 

393,895

 

 

 

 

 

 

 

 

Total liabilities and shareholders' equity

 

$

3,185,615

 

 

 

 

 

 

 

 

 

$

2,835,182

 

 

 

 

 

 

 

 

Net interest income / interest rate spreads

 

 

 

 

 

$

104,789

 

 

 

3.10

%

 

 

 

 

 

$

96,900

 

 

 

3.07

%

Net interest margin

 

 

 

 

 

 

 

 

 

 

3.52

%

 

 

 

 

 

 

 

 

 

 

3.63

%

(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)

(Dollars in thousands, except per share amounts)

 

 

 

For the three months ended

 

 

 

December 31

 

 

September 30,

 

 

December 31

 

 

 

2020

 

 

2020

 

 

2019

 

Per share data (common stock)

 

 

 

 

 

 

 

 

 

 

 

 

Earnings

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.57

 

 

$

0.43

 

 

$

0.53

 

Diluted

 

$

0.56

 

 

$

0.43

 

 

$

0.52

 

Dividends declared

 

$

0.09

 

 

$

0.06

 

 

$

0.10

 

Basic, excluding merger and conversion expense

 

$

0.57

 

 

$

0.43

 

 

$

0.54

 

Diluted, excluding merger and conversion expense

 

$

0.56

 

 

$

0.43

 

 

$

0.53

 

Book value

 

$

21.90

 

 

$

21.35

 

 

$

20.35

 

Tangible book value

 

$

18.10

 

 

$

17.56

 

 

$

17.12

 

Weighted average shares outstanding

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

19,655,621

 

 

 

19,717,568

 

 

 

20,001,916

 

Diluted

 

 

19,812,401

 

 

 

19,804,892

 

 

 

20,389,099

 

Shares outstanding at period end

 

 

19,565,921

 

 

 

19,739,280

 

 

 

20,030,866

 

Performance ratios

 

 

 

 

 

 

 

 

 

 

 

 

Return on average assets, annualized

 

 

1.33

%

 

 

1.05

%

 

 

1.51

%

Return on average shareholders' equity, annualized

 

 

10.38

%

 

 

8.06

%

 

 

10.49

%

Return on average tangible common equity, annualized

 

 

12.58

%

 

 

9.81

%

 

 

12.50

%

Noninterest income to average assets, annualized

 

 

0.54

%

 

 

0.34

%

 

 

0.82

%

Noninterest expense to average assets, annualized

 

 

1.73

%

 

 

1.72

%

 

 

1.90

%

Yield on average earning assets

 

 

4.55

%

 

 

4.63

%

 

 

5.09

%

Cost of average deposits

 

 

0.71

%

 

 

0.87

%

 

 

1.55

%

Cost of average interest-bearing deposits

 

 

0.93

%

 

 

1.14

%

 

 

1.93

%

Cost of average interest-bearing liabilities

 

 

1.23

%

 

 

1.43

%

 

 

2.21

%

Accretion on loans to average earning assets

 

 

0.03

%

 

 

0.08

%

 

 

0.10

%

Net interest spread

 

 

3.32

%

 

 

3.20

%

 

 

2.88

%

Net interest margin

 

 

3.67

%

 

 

3.59

%

 

 

3.47

%

Efficiency ratio

 

 

43.32

%

 

 

46.63

%

 

 

46.52

%

Common stock dividend payout ratio

 

 

15.79

%

 

 

13.95

%

 

 

18.87

%

RBB BANCORP AND SUBSIDIARIES

SELECTED FINANCIAL HIGHLIGHTS

(Unaudited)

(Dollars in thousands, except per share amounts)

 

 

 

For the twelve months ended December 31,

 

 

 

2020

 

 

2019

 

Per share data (common stock)

 

 

 

 

 

 

 

 

Earnings

 

 

 

 

 

 

 

 

Basic

 

$

1.66

 

 

$

1.96

 

Diluted

 

$

1.65

 

 

$

1.92

 

Basic, excluding merger expense

 

$

1.69

 

 

$

1.99

 

Diluted, excluding merger expense

 

$

1.68

 

 

$

1.94

 

Dividends declared

 

$

0.33

 

 

$

0.40

 

Book value

 

$

21.90

 

 

$

20.35

 

Tangible book value

 

$

18.10

 

 

$

17.12

 

Weighted average shares outstanding

 

 

 

 

 

 

 

 

Basic

 

 

19,763,422

 

 

 

20,017,306

 

Diluted

 

 

19,921,859

 

 

 

20,393,424

 

Shares outstanding at period end

 

 

19,565,921

 

 

 

20,030,866

 

Performance ratios

 

 

 

 

 

 

 

 

Return on average assets, annualized

 

 

1.03

%

 

 

1.38

%

Return on average shareholders' equity, annualized

 

 

7.88

%

 

 

9.95

%

Return on average tangible common equity, annualized

 

 

9.62

%

 

 

11.93

%

Noninterest income to average assets, annualized

 

 

0.44

%

 

 

0.65

%

Noninterest expense to average assets, annualized

 

 

1.87

%

 

 

2.03

%

Yield on average earning assets

 

 

4.67

%

 

 

5.31

%

Cost of average deposits

 

 

1.01

%

 

 

1.56

%

Cost of average interest-bearing deposits

 

 

1.30

%

 

 

1.93

%

Cost of average interest-bearing liabilities

 

 

1.57

%

 

 

2.24

%

Accretion on loans to average earning assets

 

 

0.08

%

 

 

0.11

%

Net interest spread

 

 

3.10

%

 

 

3.07

%

Net interest margin

 

 

3.52

%

 

 

3.63

%

Efficiency ratio

 

 

50.10

%

 

 

49.90

%

Common stock dividend payout ratio

 

 

19.88

%

 

 

20.41

%

RBB BANCORP AND SUBSIDIARIES

SELECTED FINANCIAL HIGHLIGHTS

(Unaudited)

(Dollars in thousands, except per share amounts)

 

 

 

As of

 

 

 

December 31,

 

 

September 30,

 

 

December 31,

 

 

 

2020

 

 

2020

 

 

2019

 

Loan to deposit ratio

 

 

102.72

%

 

 

105.49

%

 

 

97.69

%

Core deposits / total deposits

 

 

76.65

%

 

 

99.34

%

 

 

70.46

%

Net non-core funding dependence ratio

 

 

12.47

%

 

 

14.47

%

 

 

21.04

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Credit Quality Data:

 

 

 

 

 

 

 

 

 

 

 

 

Loans 30-89 days past due

 

$

8,939

 

 

$

21,735

 

 

$

4,393

 

Loans 30-89 days past due to total loans

 

 

0.33

%

 

 

0.79

%

 

 

0.20

%

Nonperforming loans

 

$

19,554

 

 

$

17,975

 

 

$

13,218

 

Nonperforming loans to total loans

 

 

0.72

%

 

 

0.65

%

 

 

0.60

%

Nonperforming assets

 

$

19,847

 

 

$

18,268

 

 

$

13,511

 

Nonperforming assets to total assets

 

 

0.59

%

 

 

0.54

%

 

 

0.48

%

Allowance for loan losses to total loans

 

 

1.08

%

 

 

0.97

%

 

 

0.86

%

Allowance for loan losses to nonperforming loans

 

 

150.03

%

 

 

148.17

%

 

 

142.35

%

Net charge-offs to average loans (for the quarter-to-date period)

 

 

0.05

%

 

 

0.01

%

 

 

0.23

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Regulatory and other capital ratios—Company

 

 

 

 

 

 

 

 

 

 

 

 

Tangible common equity to tangible assets

 

 

10.81

%

 

 

10.55

%

 

 

12.59

%

Tier 1 leverage ratio

 

 

11.32

%

 

 

11.47

%

 

 

12.89

%

Tier 1 common capital to risk-weighted assets

 

 

14.63

%

 

 

14.11

%

 

 

17.16

%

Tier 1 capital to risk-weighted assets

 

 

15.22

%

 

 

14.69

%

 

 

17.65

%

Total capital to risk-weighted assets

 

 

20.78

%

 

 

20.05

%

 

 

23.82

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Regulatory capital ratios—Bank only

 

 

 

 

 

 

 

 

 

 

 

 

Tier 1 leverage ratio

 

 

14.09

%

 

 

14.16

%

 

 

15.23

%

Tier 1 common capital to risk-weighted assets

 

 

18.95

%

 

 

18.13

%

 

 

20.87

%

Tier 1 capital to risk-weighted assets

 

 

18.95

%

 

 

18.13

%

 

 

20.87

%

Total capital to risk-weighted assets

 

 

20.20

%

 

 

19.26

%

 

 

21.86

%

RBB BANCORP AND SUBSIDIARIES

SELECTED FINANCIAL HIGHLIGHTS

(Unaudited)

(Dollars in thousands, except per share amounts)

 

 

 

4th Quarter

 

 

3rd Quarter

 

 

2nd Quarter

 

 

1st Quarter

 

 

4th Quarter

 

Quarterly Consolidated Statements of Earnings

 

2020

 

 

2020

 

 

2020

 

 

2020

 

 

2019

 

Interest income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans, including fees

 

$

34,832

 

 

$

34,153

 

 

$

32,633

 

 

$

32,276

 

 

$

32,178

 

Investment securities and other

 

 

1,032

 

 

 

972

 

 

 

1,470

 

 

 

1,752

 

 

 

1,729

 

Total interest income

 

 

35,864

 

 

 

35,125

 

 

 

34,103

 

 

 

34,028

 

 

 

33,907

 

Interest expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

 

4,636

 

 

 

5,525

 

 

 

6,715

 

 

 

8,329

 

 

 

8,796

 

Interest on subordinated debentures and other

 

 

1,901

 

 

 

1,905

 

 

 

1,915

 

 

 

1,956

 

 

 

1,915

 

Other borrowings

 

 

450

 

 

 

444

 

 

 

439

 

 

 

150

 

 

 

73

 

Total interest expense

 

 

6,987

 

 

 

7,874

 

 

 

9,069

 

 

 

10,435

 

 

 

10,784

 

Net interest income before provision for loan losses

 

 

28,877

 

 

 

27,251

 

 

 

25,034

 

 

 

23,593

 

 

 

23,123

 

Provision for loan losses

 

 

3,008

 

 

 

3,861

 

 

 

3,009

 

 

 

1,945

 

 

 

659

 

Net interest income after provision for loan losses

 

 

25,869

 

 

 

23,390

 

 

 

22,025

 

 

 

21,648

 

 

 

22,464

 

Noninterest income

 

 

4,490

 

 

 

2,727

 

 

 

2,208

 

 

 

4,615

 

 

 

5,823

 

Noninterest expense

 

 

14,453

 

 

 

13,978

 

 

 

14,819

 

 

 

16,263

 

 

 

13,465

 

Earnings before income taxes

 

 

15,906

 

 

 

12,139

 

 

 

9,414

 

 

 

10,000

 

 

 

14,822

 

Income taxes

 

 

4,759

 

 

 

3,619

 

 

 

2,901

 

 

 

3,252

 

 

 

4,149

 

Net income

 

$

11,147

 

 

$

8,520

 

 

$

6,513

 

 

$

6,748

 

 

$

10,673

 

Net income per common share - basic

 

$

0.57

 

 

$

0.43

 

 

$

0.33

 

 

$

0.34

 

 

$

0.53

 

Net income per common share - diluted

 

$

0.56

 

 

$

0.43

 

 

$

0.33

 

 

$

0.33

 

 

$

0.52

 

Cash dividends declared per common share

 

$

0.09

 

 

$

0.06

 

 

$

0.06

 

 

$

0.12

 

 

$

0.10

 

Cash dividends declared on common shares

 

$

1,777

 

 

$

1,184

 

 

$

1,184

 

 

$

2,407

 

 

$

2,003

 

Yield on average assets, annualized

 

 

1.33

%

 

 

1.05

%

 

 

0.83

%

 

 

0.90

%

 

 

1.51

%

Yield on average earning assets

 

 

4.55

%

 

 

4.63

%

 

 

4.60

%

 

 

4.86

%

 

 

5.09

%

Cost of average deposits

 

 

0.71

%

 

 

0.87

%

 

 

1.09

%

 

 

1.38

%

 

 

1.55

%

Cost of average interest-bearing deposits

 

 

0.93

%

 

 

1.14

%

 

 

1.41

%

 

 

1.72

%

 

 

1.93

%

Cost of average interest-bearing liabilities

 

 

1.23

%

 

 

1.43

%

 

 

1.66

%

 

 

1.98

%

 

 

2.21

%

Accretion on loans to average earning assets

 

 

0.03

%

 

 

0.08

%

 

 

0.13

%

 

 

0.10

%

 

 

0.10

%

Net interest margin

 

 

3.67

%

 

 

3.59

%

 

 

3.38

%

 

 

3.37

%

 

 

3.47

%

RBB BANCORP AND SUBSIDIARIES

SELECTED FINANCIAL HIGHLIGHTS

(Unaudited, except for December 31, 2019)

(Dollars in thousands, except per share amounts)

 

Loan Portfolio Detail

 

As of
December 31, 2020

 

 

As of
September 30, 2020

 

 

As of
June 30, 2020

 

 

As of
March 31, 2020

 

 

As of
December 31, 2019

 

(dollars in thousands)

 

$

 

%

 

 

$

 

%

 

 

$

 

%

 

 

$

 

%

 

 

$

 

%

 

Loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial and industrial

 

$

290,139

 

 

 

10.7

 

 

$

317,891

 

 

 

11.5

 

 

$

267,481

 

 

 

10.3

 

 

$

275,602

 

 

 

11.5

 

 

$

274,586

 

 

 

12.5

 

SBA

 

 

97,821

 

 

 

3.6

 

 

 

111,193

 

 

 

4.0

 

 

 

104,069

 

 

 

4.0

 

 

 

77,566

 

 

 

3.2

 

 

 

74,985

 

 

 

3.4

 

Construction and land development

 

 

186,723

 

 

 

6.9

 

 

 

183,569

 

 

 

6.7

 

 

 

145,754

 

 

 

5.6

 

 

 

120,115

 

 

 

5.0

 

 

 

96,020

 

 

 

4.4

 

Commercial real estate (1)

 

 

1,003,637

 

 

 

37.1

 

 

 

975,187

 

 

 

35.4

 

 

 

900,302

 

 

 

34.7

 

 

 

854,580

 

 

 

35.6

 

 

 

793,268

 

 

 

36.1

 

Single-family residential mortgages

 

 

1,124,357

 

 

 

41.5

 

 

 

1,163,982

 

 

 

42.2

 

 

 

1,174,927

 

 

 

45.3

 

 

 

1,070,649

 

 

 

44.6

 

 

 

957,254

 

 

 

43.6

 

Other loans

 

 

4,089

 

 

 

0.2

 

 

 

3,331

 

 

 

0.2

 

 

 

2,087

 

 

 

0.1

 

 

 

1,470

 

 

 

0.1

 

 

 

821

 

 

 

0.0

 

Total loans (2)

 

$

2,706,766

 

 

 

100.0

 

 

$

2,755,153

 

 

 

100.0

 

 

$

2,594,620

 

 

 

100.0

 

 

$

2,399,982

 

 

 

100.0

 

 

$

2,196,934

 

 

 

100.0

 

Allowance for loan losses

 

 

(29,337

)

 

 

 

 

 

 

(26,634

)

 

 

 

 

 

 

(22,820

)

 

 

 

 

 

 

(20,130

)

 

 

 

 

 

 

(18,816

)

 

 

 

 

Total loans, net

 

$

2,677,429

 

 

 

 

 

 

$

2,728,519

 

 

 

 

 

 

$

2,571,800

 

 

 

 

 

 

$

2,379,852

 

 

 

 

 

 

$

2,178,118

 

 

 

 

 

(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.

 

 

Three Months Ended

 

Twelve Months Ended

Change in Allowance for Loan Losses

 

December 31,

 

December 31,

(dollars in thousands)

 

2020

 

2019

 

2020

 

2019

Beginning balance

 

$

26,634

 

 

$

19,386

 

 

$

18,816

 

 

$

17,577

 

Additions to the allowance charged to expense

 

 

3,008

 

 

 

659

 

 

 

11,823

 

 

 

2,390

 

Net charge-offs on loans

 

 

(305

)

 

 

(1,229

)

 

 

(1,302

)

 

 

(1,151

)

Ending balance

 

$

29,337

 

 

$

18,816

 

 

$

29,337

 

 

$

18,816

 

Tangible Book Value Reconciliations (non-GAAP)

The tangible book value per share is a non-GAAP disclosure. The Company uses certain non-GAAP financial measures to provide supplemental information regarding the Company’s 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 December 31, 2020 and 2019.

 

 

 

 

 

 

 

 

 

 

(dollars in thousands, except per share data)

 

December 31, 2020

 

September 30, 2020

 

December 31, 2019

Tangible common equity:

 

 

 

 

 

 

 

 

 

Total shareholders' equity

 

$

428,488

 

 

$

421,416

 

 

$

407,567

 

Adjustments

 

 

 

 

 

 

 

 

 

Goodwill

 

 

(69,243

)

 

 

(69,243

)

 

 

(58,563

)

Core deposit intangible

 

 

(5,196

)

 

 

(5,519

)

 

 

(6,100

)

Tangible common equity

 

$

354,049

 

 

$

346,654

 

 

$

342,904

 

Tangible assets:

 

 

 

 

 

 

 

 

 

Total assets-GAAP

 

$

3,350,072

 

 

$

3,359,576

 

 

$

2,788,535

 

Adjustments

 

 

 

 

 

 

 

 

 

Goodwill

 

 

(69,243

)

 

 

(69,243

)

 

 

(58,563

)

Core deposit intangible

 

 

(5,196

)

 

 

(5,519

)

 

 

(6,100

)

Tangible assets

 

$

3,275,633

 

 

$

3,284,814

 

 

$

2,723,872

 

Common shares outstanding

 

 

19,565,921

 

 

 

19,739,280

 

 

 

20,030,866

 

Tangible common equity to tangible assets ratio

 

 

10.81

%

 

 

10.55

%

 

 

12.59

%

Book value per share

 

$

21.90

 

 

$

21.35

 

 

$

20.35

 

Tangible book value per share

 

$

18.10

 

 

$

17.56

 

 

$

17.12

 

Earnings Per Share Excluding Merger and Conversion Expense (non-GAAP)

Earnings per share excluding merger and conversion expense is a non-GAAP disclosure. The Company uses certain non-GAAP financial measures to provide supplemental information regarding the Company’s performance. The following is a calculation of earnings per share with after-tax net income excluding tax-affected merger and conversion expense. This EPS calculation is presented for the quarters ended December 31, 2020, September 30, 2020 and December 31, 2019, plus for the twelve-month periods ending December 31, 2020 and 2019.

 

 

For the three months ended

 

For the twelve months ended

 

 

December 31, 2020

 

September 30, 2020

 

December 31, 2019

 

December 31, 2020

 

December 31, 2019

Earnings Per Share Excluding Merger and Conversion Expense (non-GAAP)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income after tax

 

$

11,147

 

 

$

8,520

 

 

$

10,673

 

 

$

32,928

 

 

$

39,209

 

Merger and conversion expense

 

 

5

 

 

 

62

 

 

 

231

 

 

 

746

 

 

 

471

 

Tax on merger and conversion expense

 

 

(1

)

 

 

(18

)

 

 

(65

)

 

 

(228

)

 

 

(137

)

Net adjustment

 

 

4

 

 

 

44

 

 

 

166

 

 

 

518

 

 

 

334

 

Adjusted net income after tax

 

$

11,151

 

 

$

8,564

 

 

$

10,839

 

 

$

33,446

 

 

$

39,543

 

Weighted average shares outstanding

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

19,655,621

 

 

 

19,717,568

 

 

 

20,001,916

 

 

 

19,763,422

 

 

 

20,017,306

 

Diluted

 

 

19,812,401

 

 

 

19,804,892

 

 

 

20,389,099

 

 

 

19,921,859

 

 

 

20,393,424

 

Adjusted Earnings Per Share

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic, excluding merger and conversion expense

 

$

0.57

 

 

$

0.43

 

 

$

0.54

 

 

$

1.69

 

 

$

1.99

 

Diluted, excluding merger and conversion expense

 

$

0.56

 

 

$

0.43

 

 

$

0.53

 

 

$

1.68

 

 

$

1.94

 

Efficiency Ratio (non-GAAP)

The efficiency ratio is a non-GAAP disclosure. The Company uses certain non-GAAP financial measures to provide supplemental information regarding the Company’s performance. The efficiency ratio is non-interest expense divided by net interest income plus non-interest income. The efficiency ratio is presented for the quarters ended December 31, 2020, September 30, 2020 and December 31, 2019, plus the twelve-month periods ending December 31, 2020 and 2019.

 

 

For the three months ended

 

For the twelve months ended

 

 

December 31, 2020

 

September 30, 2020

 

December 31, 2019

 

December 31, 2020

 

December 31, 2019

Efficiency Ratio (non-GAAP)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest expense

 

$

14,453

 

 

$

13,978

 

 

$

13,465

 

 

$

59,513

 

 

$

57,473

 

Net interest income

 

 

28,877

 

 

 

27,251

 

 

 

23,123

 

 

 

104,755

 

 

 

96,864

 

Noninterest income

 

 

4,490

 

 

 

2,727

 

 

 

5,823

 

 

 

14,040

 

 

 

18,320

 

Net interest income and non-interest income

 

$

33,367

 

 

$

29,978

 

 

$

28,946

 

 

$

118,795

 

 

$

115,184

 

Efficiency ratio

 

 

43.32

%

 

 

46.63

%

 

 

46.52

%

 

 

50.10

%

 

 

49.90

%

 

Yee Phong (Alan) Thian
Chairman, President and CEO
(626) 307-7559
David Morris
Executive Vice President and CFO
(714) 670-2488

Source: RBB Bancorp