RBB Bancorp Reports First Quarter Earnings for 2021

April 26, 2021

Conference Call and Webcast Scheduled for Tuesday, April 27, 2021 at 11:00 a.m. Pacific Time/2:00 p.m. Eastern Time

First Quarter 2021 Highlights

Reported record net income of $12.5 million, or $ 0.63 diluted earnings per share, increased $1.3 million, or 11.7%, from the prior quarter and increased $5.7 million, or 84.6%, from the first quarter of 2020
Non-interest bearing deposits increased by $170.2 million, or 27.6%, from the end of the prior quarter
Net interest margin of 3.73% increased by 6 basis points from the prior quarter and increased 36 basis points from the first quarter of 2020
Declared quarterly cash dividend of $0.13 per common share

LOS ANGELES--(BUSINESS WIRE)--Apr. 26, 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 March 31, 2021.

The Company reported record net income of $12.5 million, or $0.63 diluted earnings per share, for the three months ended March 31, 2021, compared to net income of $11.1 million, or $0.56 diluted earnings per share, and $6.7 million, or $0.33 diluted earnings per share, for the three months ended December 31, 2020 and March 31, 2020, respectively.

“Royal Business Bank started 2021 with excellent first quarter results as our differentiated business model benefited from a rapidly improving economy,” said Mr. Alan Thian, Chairman, President and CEO of RBB Bancorp. “We reported record net income, improving margins, stable credit quality and strong growth in noninterest-bearing deposits. We raised $120 million of subordinated debt which dramatically increases our ability to pursue profitable organic and strategic growth opportunities. We believe we are well-positioned to accelerate our profitable growth in 2021 by providing exceptional customer service to the individuals, businesses and communities we serve.”

Key Performance Ratios

Net income of $12.5 million for the first quarter of 2021 produced an annualized return on average assets of 1.47%, an annualized return on average tangible common shareholders' equity of 14.05%, and an annualized return on average shareholders' equity of 11.64%. This compares to 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% for the fourth quarter of 2020. The efficiency ratio for the first quarter of 2021 was 44.64%, compared to 43.32% for the prior quarter. The change in the efficiency ratio was primarily due to a seasonal increase in non-interest expense.

Net Interest Income and Net Interest Margin

Net interest income, before provision for loan losses, was $29.5 million for the first quarter of 2021, compared to $28.9 million for the fourth quarter of 2020. The $608,000 increase was primarily attributable to higher interest income due to a $74.1 million increase in average earning assets and an improvement in the deposit costs related to a $36.9 million increase in average noninterest-bearing deposits, partially offset by a $39.1 million increase in average interest-bearing liabilities. Accretion of purchase discounts from prior acquisitions contributed $480,000 to net interest income in the first quarter of 2021, compared to $275,000 in the fourth quarter of 2020.

Compared to the first quarter of 2020, net interest income, before provision for loan losses, increased $5.9 million from $23.6 million. The increase was primarily attributable to a $388.8 million increase in average earning assets and a $168.1 million increase in average noninterest-bearing deposits, partially offset by a $188.3 million increase in average interest-bearing liabilities. The increases in average earning assets and total deposits were primarily due to increased loan and deposit originations.

Net interest margin was 3.73% for the first quarter of 2021, an increase of 6 basis points from 3.67% in the fourth quarter of 2020. The increase was primarily attributable to a 16 basis point decrease in the cost of total deposits partially offset by an 18 basis point increase in the cost of borrowings (FHLB advances, long-term debt and subordinated debentures) and a 6 basis point decrease in the yield on average earning assets. Loan discount accretion contributed 6 basis points to the net interest margin in the first quarter of 2021, compared to 3 basis points in the fourth quarter of 2020.

Noninterest Income

Noninterest income was $5.9 million for the first quarter of 2021, an increase of $1.4 million from $4.5 million in the fourth quarter of 2020. The increase was driven by an increase in gain on loan sales of $1.4 million as the Company sold $73.5 million more loans in the first quarter than in the prior quarter generally due to selling FNMA loans.

The Company sold $80.3 million in FNMA qualified mortgage loans for a net gain of $2.2 million and sold $49.8 million in non-qualified mortgage loans to private investors for a gain of $1.2 million during the first quarter of 2021. This compared to $24.7 million in FNMA qualified mortgage loans for a net gain of $645,000 and $24.3 million in non-qualified mortgage loans to private investors for a gain of $1.2 million during the fourth quarter of 2020. The Company sold $3.5 million in SBA loans during the first quarter of 2021 for a net gain of $355,000, compared to $11.3 million SBA loans sold for a net gain of $595,000 during the fourth quarter of 2020.

Compared to the first quarter of 2020, noninterest income increased by $1.3 million from $4.6 million. The increase was primarily attributable to an increase of $1.1 million in gain on loan sales and an increase of $225,000 in derivative income.

Noninterest Expense

Noninterest expense for the first quarter of 2021 was $15.8 million, compared to $14.5 million for the fourth quarter of 2020. The $1.3 million increase was primarily attributable to a $1.1 million increase from commission paid, payroll tax on bonuses, a $428,000 temporary increase in data processing expenses, partially offset by $158,000 decrease in occupancy and equipment expenses, and an $111,000 decrease in marketing and business promotion expenses.

Noninterest expense decreased from $16.3 million in the first quarter of 2020. The $471,000 decrease was primarily due to a $361,000 decrease in merger and conversion expenses, a $263,000 decrease in salaries and employee benefits expenses, and a $162,000 decrease in occupancy and equipment expenses. These were partially offset by a $298,000 increase in data processing expense.

Income Taxes

The effective tax rate was 31.13% for the first quarter of 2021, 29.92% for the fourth quarter of 2020, and 32.52% for the first quarter of 2020.

Loan Portfolio

Loans held for investment, net of deferred fees and discounts, totaled $2.7 billion as of March 31, 2021, an increase of $8.4 million from December 31, 2020, and an increase of $315.2 million from March 31, 2020. The increase from the prior quarter was primarily due to an increase in loan originations. Single-family residential mortgages decreased by $83.1 million net of payoffs, paydowns and loan sales. Commercial real estate loans increased by $59.5 million, construction and land development loans increased by $23.0 million, SBA loans increased by $13.5 million, commercial and industrial loans decreased by $4.1 million and other loans decreased by $321,000.

During the first quarter of 2021, single-family residential mortgage production was $114.5 million, payoffs and paydowns were $81.9 million, and single-family residential mortgage loan sales were $130.1 million. During the fourth quarter of 2020, single-family residential mortgage production was $110.3 million, payoffs and paydowns were $74.5 million, and loan sales were $49.0 million.

Mortgage loans held for sale were $37.7 million as of March 31, 2021, a decrease of $12.3 million from $50.0 million at December 31, 2020 and a decrease of $14.4 million from $52.1 million as of March 31, 2020. The Company originated approximately $55.3 million in mortgage loans for sale for the first quarter of 2021, compared with $50.0 million during the prior quarter.

In the first quarter of 2021, SBA loan production was $37.8 million and total SBA loan sales were $3.5 million.

Deposits and Borrowings

Deposits were $2.8 billion at March 31, 2021, an increase of $186.2 million from December 31, 2020, and an increase of $401.0 million from March 31, 2020, excluding brokered deposits. The increase in total deposits from the prior quarter was primarily attributable to organic deposit growth. During the first quarter of 2021, noninterest-bearing deposits increased by $170.2 million, interest-bearing non-maturity deposits increased by $60.4 million, and time deposits decreased by $44.5 million. As of March 31, 2021, time deposits included $17.4 million in brokered CDs, as compared to $17.4 million as of December 31, 2020 and $33.1 million as of March 31, 2020.

On March 31, 2021, the long-term subordinated-debt was reissued, and an additional $68.4 million was raised.

Asset Quality

Nonperforming assets totaled $20.2 million, or 0.55% of total assets at March 31, 2021, compared to $19.8 million, or 0.59%, of total assets at December 31, 2020. 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.

In the first quarter of 2021, there were $42,000 in net charge-offs, down from $305,000 in the prior quarter.

The Company recorded a provision for credit losses of $1.5 million for the first quarter of 2021, a decrease from $3.0 million in the prior quarter, primarily attributable to remaining COVID-19-related economic risk and loan growth.

The allowance for loan losses totaled $30.8 million, or 1.13% of loans held for investment at March 31, 2021, compared with $29.3 million, or 1.08%, of total loans at December 31, 2020.

As of March 31, 2021, borrowers representing 285 loans totaling $42.9 million, or 1.6% of the Company’s total loan portfolio, have funded under the SBA’s Paycheck Protection Program due to the COVID-19 pandemic. Presently none of our SBA customers are on a payment deferral plan due to the COVID-19 pandemic.

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

	As of June 30, 2020				As of October 23, 2020				As of January 15, 2021				As of April 15, 2021
	Loans Deferred				Loans Deferred				Loans Deferred				Loans Deferred
	Number		Principal Amount ($000)		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		1	$	438
Mixed use commercial		38		58,841		4		10,547		1		7,500		4		2,602
Hospitality (excluding SBA)		5		25,343		2		12,929		1		6,419		1		6,394	(1)
Restaurants (excluding SBA)		11		4,186		1		12		—		—		—		—
Multifamily		6		9,086		—		—		—		—		1		688
Commercial, office and other		—		—		5		19,881		5		18,742		—		—
SFR mortgage loans - Western region		183		118,484		38		29,604		14		8,770		9		5,135
SFR mortgage loans - Eastern region		203		85,935		10		4,106		11		4,925		5		2,467
SFR mortgage loans - Chicago metropolitan		84		14,824		4		719		1		249		—		—
Total		564	$	410,950		67	$	104,638		35	$	49,779		21	$	17,724

The Company does not have any shared national credits or loans, backed by airlines or cruise lines, on deferral as of March 31, 2021.

(1) Principal deferred only.

Corporate Overview

RBB Bancorp is a community-based financial holding company headquartered in Los Angeles, California. As of March 31, 2021, the company had total assets of $3.7 billion. Its wholly-owned subsidiary, the 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, in Edison, New Jersey, and in the Chicago neighborhoods of Chinatown and Bridgeport, Illinois. 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, two 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 and two branches in Chicago, Illinois. 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 tomorrow, April 27, 2021, to discuss the Company’s first quarter 2021 financial results.

To listen to the conference call, please dial 1-833-519-1355 (domestic) or 1-918-922-6505 (international), passcode 7982973. A replay of the call will be made available at 1-800-585-8367 or 1-404-537-3406, passcode 7982973, approximately one hour after the conclusion of the call and will remain available through May 4, 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-A for the year ended December 31, 2020, 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, 2020)
(Dollars in thousands)

	March 31,			December 31,			September 30,			June 30,			March 31,
	2021			2020			2020			2020			2020
Assets
Cash and due from banks	$	362,930		$	137,654		$	121,630		$	94,844		$	285,667
Federal funds sold and other cash equivalents		57,000			57,000			57,000			57,000			75,300
Total cash and cash equivalents		419,930			194,654			178,630			151,844			360,967
Interest-bearing deposits in other financial institutions		600			600			600			600			600
Investment securities available for sale		281,582			210,867			214,662			185,756			126,294
Investment securities held to maturity		6,668			7,174			7,569			7,615			7,825
Mortgage loans held for sale		37,675			49,963			23,886			15,479			52,096
Loans held for investment		2,715,205			2,706,766			2,755,153			2,594,620			2,399,982
Allowance for loan losses		(30,795	)		(29,337	)		(26,634	)		(22,820	)		(20,130	)
Net loans held for investment		2,684,410			2,677,429			2,728,519			2,571,800			2,379,852
Premises and equipment, net		27,093			27,103			24,237			23,965			24,472
Federal Home Loan Bank (FHLB) stock		15,641			15,641			15,641			15,641			15,630
Net deferred tax assets		3,427			2,547			1,080			—			—
Cash surrender value of life insurance		35,308			35,121			34,930			34,736			34,544
Goodwill		69,243			69,243			69,243			69,209			69,790
Servicing assets		13,264			13,965			14,724			15,595			16,826
Core deposit intangibles		4,895			5,196			5,519			5,876			6,234
Right-of-use assets- operating leases		25,500			—			—			—			—
Accrued interest and other assets		39,063			40,569			40,336			38,065			33,523
Total assets	$	3,664,299		$	3,350,072		$	3,359,576		$	3,136,181		$	3,128,653
Liabilities and shareholders' equity
Deposits:
Noninterest-bearing demand	$	787,439		$	617,206		$	642,332		$	574,553		$	504,324
Savings, NOW and money market accounts		791,486			731,084			654,378			601,941			571,870
Time deposits		1,242,368			1,286,838			1,315,038			1,260,026			1,359,787
Total deposits		2,821,293			2,635,128			2,611,748			2,436,520			2,435,981
Reserve for unfunded commitments		1,320			1,383			1,129			1,030			979
Net deferred tax liabilities		—			—			—			656			312
FHLB advances		150,000			150,000			190,000			150,000			150,000
Long-term debt, net of debt issuance costs		172,581			104,391			104,305			104,220			104,135
Subordinated debentures		14,338			14,283			14,229			14,174			14,120
Lease liabilities - operating leases		26,199			—			—			—			—
Accrued interest and other liabilities		42,900			16,399			16,749			15,556			15,133
Total liabilities		3,228,631			2,921,584			2,938,160			2,722,156			2,720,660
Shareholders' equity:
Shareholder's equity		435,746			427,287			420,329			412,827			407,332
Non-controlling interest		72			72			72			72			72
Accumulated other comprehensive (loss) income - Net of tax		(150	)		1,129			1,015			1,126			589
Total shareholders' equity		435,668			428,488			421,416			414,025			407,993
Total liabilities and shareholders’ equity	$	3,664,299		$	3,350,072		$	3,359,576		$	3,136,181		$	3,128,653

RBB BANCORP AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
*(Dollars in thousands, except per share amounts)*

	For the three months ended
	March 31, 2021			December 31, 2020		March 31, 2020
Interest and dividend income:
Interest and fees on loans	$	34,516		$	34,832	$	32,276
Interest on interest-bearing deposits		48			55		451
Interest on investment securities		627			639		821
Dividend income on FHLB stock		192			193		2
Interest on federal funds sold and other		157			145		478
Total interest income		35,540			35,864		34,028
Interest expense:
Interest on savings deposits, NOW and money market accounts		698			736		1,243
Interest on time deposits		2,964			3,900		7,086
Interest on subordinated debentures and long term debt		1,958			1,901		1,956
Interest on other borrowed funds		435			450		150
Total interest expense		6,055			6,987		10,435
Net interest income before provision for loan losses		29,485			28,877		23,593
Provision for loan losses		1,500			3,008		1,945
Net interest income after provision for loan losses		27,985			25,869		21,648
Noninterest income:
Service charges, fees and other		1,410			1,565		1,079
Gain on sale of loans		3,841			2,445		2,711
Loan servicing fees, net of amortization		246			206		592
Recoveries on loans acquired in business combinations		5			5		42
Unrealized (loss) on equity investments		(20	)		—		—
Gain on derivatives		225			78		—
Increase in cash surrender value of life insurance		187			191		191
Total noninterest income		5,894			4,490		4,615
Noninterest expense:
Salaries and employee benefits		9,242			8,105		9,505
Occupancy and equipment expenses		2,242			2,400		2,404
Data processing		1,440			1,012		1,142
Legal and professional		805			794		604
Office expenses		255			295		323
Marketing and business promotion		184			295		214
Insurance and regulatory assessments		348			210		177
Core deposit premium		301			324		357
OREO expenses		5			4		14
Merger and conversion expenses		42			5		403
Other expenses		928			1,009		1,120
Total noninterest expense		15,792			14,453		16,263
Income before income taxes		18,087			15,906		10,000
Income tax expense		5,631			4,759		3,252
Net income	$	12,456		$	11,147	$	6,748

Net income per share
Basic	$	0.64		$	0.57	$	0.34
Diluted	$	0.63		$	0.56	$	0.33
Cash Dividends declared per common share	$	0.12		$	0.09	$	0.12
Weighted-average common shares outstanding
Basic		19,475,814			19,655,621		19,971,856
Diluted		19,812,841			19,812,401		20,266,328

RBB BANCORP AND SUBSIDIARIES
AVERAGE BALANCE SHEET AND NET INTEREST INCOME
(Unaudited)
*(Dollars in thousands, except per share amounts)*

	For the three months ended
	March 31, 2021							December 31, 2020							March 31, 2020
	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)	$	215,230	$	397		0.75	%	$	188,430	$	393		0.83	%	$	249,568	$	931		1.50	%
Securities
Available for sale		239,768		571		0.97	%		222,762		579		1.03	%		138,574		755		2.19	%
Held to maturity (2)		7,000		64		3.71	%		7,383		68		3.66	%		8,016		74		3.71	%
Mortgage loans held for sale		54,021		411		3.09	%		41,265		325		3.13	%		78,063		981		5.05	%
Loans held for investment: (3)
Real estate		2,307,431		29,521		5.19	%		2,282,937		29,705		5.18	%		2,007,286		26,428		5.30	%
Commercial		384,442		4,584		4.84	%		390,980		4,802		4.89	%		337,548		4,867		5.80	%
Total loans		2,691,873		34,105		5.14	%		2,673,917		34,507		5.13	%		2,344,834		31,295		5.37	%
Total earning assets		3,207,892	$	35,548		4.49	%		3,133,757	$	35,872		4.55	%		2,819,055	$	34,036		4.86	%
Noninterest-earning assets		228,002							196,071							212,568
Total assets	$	3,435,894						$	3,329,828						$	3,031,623

Interest-bearing liabilities
NOW	$	64,592	$	44		0.28	%	$	62,232	$	48		0.31	%	$	43,838	$	42		0.39	%
Money Market		579,347		623		0.44	%		504,463		656		0.52	%		432,005		1,146		1.07	%
Saving deposits		131,151		31		0.10	%		128,727		32		0.10	%		114,951		55		0.19	%
Time deposits, less than $250,000		663,029		1,496		0.92	%		698,415		2,059		1.17	%		737,755		3,376		1.84	%
Time deposits, $250,000 and over		593,981		1,468		1.00	%		594,655		1,841		1.23	%		620,884		3,710		2.40	%
Total interest-bearing deposits		2,032,100		3,662		0.73	%		1,988,492		4,636		0.93	%		1,949,433		8,329		1.72	%
FHLB advances		150,001		435		1.18	%		161,957		450		1.11	%		51,978		150		1.18	%
Long-term debt		111,739		1,808		6.56	%		104,335		1,748		6.67	%		104,083		1,748		6.75	%
Subordinated debentures		14,302		150		4.25	%		14,248		153		4.27	%		14,327		208		5.84	%
Total interest-bearing liabilities		2,308,142		6,055		1.06	%		2,269,032		6,987		1.23	%		2,119,821		10,435		1.98	%
Noninterest-bearing liabilities
Noninterest-bearing deposits		653,674							616,803							485,555
Other noninterest-bearing liabilities		40,118							16,830							15,056
Total noninterest-bearing liabilities		693,792							633,633							500,611
Shareholders' equity		433,960							427,163							411,191
Total liabilities and shareholders' equity	$	3,435,894						$	3,329,828						$	3,031,623
Net interest income / interest rate spreads			$	29,493		3.43	%			$	28,885		3.32	%			$	23,601		2.88	%
Net interest margin						3.73	%						3.67	%						3.37	%

(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
	March 31,			December 31,			March 31,
	2021			2020			2020
Per share data (common stock)
Earnings
Basic	$	0.64		$	0.57		$	0.34
Diluted	$	0.63		$	0.56		$	0.33
Dividends declared	$	0.12		$	0.09		$	0.12
Book value	$	22.31		$	21.90		$	20.67
Tangible book value	$	18.51		$	18.10		$	16.82
Weighted average shares outstanding
Basic		19,475,814			19,655,621			19,971,856
Diluted		19,812,841			19,812,401			20,266,328
Shares outstanding at period end		19,528,249			19,565,921			19,739,280
Performance ratios
Return on average assets, annualized		1.47	%		1.33	%		0.90	%
Return on average shareholders' equity, annualized		11.64	%		10.38	%		6.60	%
Return on average tangible common equity, annualized		14.05	%		12.58	%		8.13	%
Noninterest income to average assets, annualized		0.70	%		0.54	%		0.61	%
Noninterest expense to average assets, annualized		1.86	%		1.73	%		2.16	%
Yield on average earning assets		4.49	%		4.55	%		4.86	%
Cost of average total deposits		0.55	%		0.71	%		1.38	%
Cost of average interest-bearing deposits		0.73	%		0.93	%		1.72	%
Cost of average interest-bearing liabilities		1.06	%		1.23	%		1.98	%
Accretion on loans to average earning assets		0.06	%		0.03	%		0.10	%
Net interest spread		3.43	%		3.32	%		2.88	%
Net interest margin		3.73	%		3.67	%		3.37	%
Efficiency ratio		44.64	%		43.32	%		57.65	%
Common stock dividend payout ratio		18.75	%		15.79	%		35.29	%

RBB BANCORP AND SUBSIDIARIES
SELECTED FINANCIAL HIGHLIGHTS
(Unaudited)
*(Dollars in thousands, except per share amounts)*

	As of
	March 31,			December 31,			March 31,
	2021			2020			2020
Loan to deposit ratio		96.24	%		102.72	%		98.52	%
Core deposits / total deposits		78.97	%		77.31	%		74.11	%
Net non-core funding dependence ratio		4.27	%		9.11	%		6.62	%

Credit Quality Data:
Loans 30-89 days past due	$	10,653		$	8,939		$	22,488
Loans 30-89 days past due to total loans		0.39%			0.33%			0.94%
Loans 90 days past due and still accruing	$	—		$	—		$	225
Nonperforming loans	$	19,911		$	19,554		$	20,499
Nonperforming loans to total loans		0.73	%		0.72	%		0.85	%
Nonperforming assets	$	20,204		$	19,847		$	20,792
Nonperforming assets to total assets		0.55	%		0.59	%		0.66	%
Allowance for loan losses to total loans		1.13	%		1.08	%		0.84	%
Allowance for loan losses to nonperforming loans		154.66	%		150.03	%		98.20	%
Net charge-offs to average loans (for the quarter-to-date period)		0.01	%		0.05	%		0.11	%

Regulatory and other capital ratios—Company
Tangible common equity to tangible assets		10.07	%		10.81	%		10.87	%
Tier 1 leverage ratio		11.30	%		11.32	%		11.74	%
Tier 1 common capital to risk-weighted assets		14.53	%		14.62	%		15.45	%
Tier 1 capital to risk-weighted assets		15.11	%		15.21	%		16.10	%
Total capital to risk-weighted assets		23.27	%		20.77	%		21.91	%

Regulatory capital ratios—Bank only
Tier 1 leverage ratio		13.44	%		14.11	%		14.44	%
Tier 1 common capital to risk-weighted assets		17.96	%		18.94	%		19.79	%
Tier 1 capital to risk-weighted assets		17.96	%		18.94	%		19.79	%
Total capital to risk-weighted assets		19.21	%		20.19	%		20.77	%

RBB BANCORP AND SUBSIDIARIES
SELECTED FINANCIAL HIGHLIGHTS
(Unaudited)
*(Dollars in thousands, except per share amounts)*

	1st Quarter			4th Quarter			3rd Quarter			2nd Quarter			1st Quarter
Quarterly Consolidated Statements of Earnings	2021			2020			2020			2020			2020
Interest income
Loans, including fees	$	34,516		$	34,832		$	34,153		$	32,633		$	32,276
Investment securities and other		1,024			1,032			972			1,470			1,752
Total interest income		35,540			35,864			35,125			34,103			34,028
Interest expense
Deposits		3,662			4,636			5,525			6,715			8,329
Interest on subordinated debentures and other		1,958			1,901			1,905			1,915			1,956
Other borrowings		435			450			444			439			150
Total interest expense		6,055			6,987			7,874			9,069			10,435
Net interest income before provision for loan losses		29,485			28,877			27,251			25,034			23,593
Provision for loan losses		1,500			3,008			3,861			3,009			1,945
Net interest income after provision for loan losses		27,985			25,869			23,390			22,025			21,648
Noninterest income		5,894			4,490			2,727			2,208			4,615
Noninterest expense		15,792			14,453			13,978			14,819			16,263
Earnings before income taxes		18,087			15,906			12,139			9,414			10,000
Income taxes		5,631			4,759			3,619			2,901			3,252
Net income	$	12,456		$	11,147		$	8,520		$	6,513		$	6,748
Net income per common share - basic	$	0.64		$	0.57		$	0.43		$	0.33		$	0.34
Net income per common share - diluted	$	0.63		$	0.56		$	0.43		$	0.33		$	0.33
Cash dividends declared per common share	$	0.12		$	0.09		$	0.06		$	0.06		$	0.12
Cash dividends declared on common shares	$	2,347		$	1,777		$	1,184		$	1,184		$	2,407
Yield on average assets, annualized		1.47	%		1.33	%		1.05	%		0.83	%		0.90	%
Yield on average earning assets		4.49	%		4.55	%		4.63	%		4.60	%		4.86	%
Cost of average deposits		0.55	%		0.71	%		0.87	%		1.09	%		1.38	%
Cost of average interest-bearing deposits		0.73	%		0.93	%		1.14	%		1.42	%		1.72	%
Cost of average interest-bearing liabilities		1.06	%		1.23	%		1.43	%		1.68	%		1.98	%
Accretion on loans to average earning assets		0.06	%		0.03	%		0.08	%		0.16	%		0.10	%
Net interest margin		3.73	%		3.67	%		3.59	%		3.42	%		3.37	%

RBB BANCORP AND SUBSIDIARIES
SELECTED FINANCIAL HIGHLIGHTS
(Unaudited, except for December 31, 2020)
*(Dollars in thousands, except per share amounts)*

Loan Portfolio Detail	As of March 31, 2021						As of December 31, 2020						As of September 30, 2020						As of June 30, 2020						As of March 31, 2020
(dollars in thousands)	$			%			$			%			$			%			$			%			$			%
Loans:
Commercial and industrial	$	286,016			10.5	%	$	290,139			10.7	%	$	317,891			11.5	%	$	267,481			10.3	%	$	275,602			11.5	%
SBA		111,330			4.1	%		97,821			3.6	%		111,193			4.0	%		104,069			4.0	%		77,566			3.2	%
Construction and land development		209,727			7.7	%		186,723			6.9	%		183,569			6.7	%		145,754			5.6	%		120,115			5.0	%
Commercial real estate (1)		1,063,104			39.2	%		1,003,637			37.1	%		975,187			35.4	%		900,302			34.7	%		854,580			35.6	%
Single-family residential mortgages		1,041,260			38.3	%		1,124,357			41.5	%		1,163,982			42.2	%		1,174,927			45.3	%		1,070,649			44.6	%
Other loans		3,768			0.2	%		4,089			0.2	%		3,331			0.2	%		2,087			0.1	%		1,470			0.1	%
Total loans (2)	$	2,715,205			100.0	%	$	2,706,766			100.0	%	$	2,755,153			100.0	%	$	2,594,620			100.0	%	$	2,399,982			100.0	%
Allowance for loan losses		(30,795	)					(29,337	)					(26,634	)					(22,820	)					(20,130	)
Total loans, net	$	2,684,410					$	2,677,429					$	2,728,519					$	2,571,800					$	2,379,852

(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
Change in Allowance for Loan Losses	March 31,
(dollars in thousands)	2021			2020
Beginning balance	$	29,337		$	18,816
Additions to the allowance charged to expense		1,500			1,945
Net charge-offs on loans		(42	)		(631	)
Ending balance	$	30,795		$	20,130

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 March 31, 2021 and 2020 and December 31, 2020.


(dollars in thousands, except per share data)	March 31, 2021			December 31, 2020			March 31, 2020
Tangible common equity:
Total shareholders' equity	$	435,668		$	428,488		$	407,993
Adjustments
Goodwill		(69,243	)		(69,243	)		(69,790	)
Core deposit intangible		(4,895	)		(5,196	)		(6,234	)
Tangible common equity	$	361,530		$	354,049		$	331,969
Tangible assets:
Total assets-GAAP	$	3,664,299		$	3,350,072		$	3,128,653
Adjustments
Goodwill		(69,243	)		(69,243	)		(69,790	)
Core deposit intangible		(4,895	)		(5,196	)		(6,234	)
Tangible assets	$	3,590,161		$	3,275,633		$	3,052,629
Common shares outstanding	$	19,528,249			19,565,921			19,739,280
Tangible common equity to tangible assets ratio		10.07	%		10.81	%		10.87	%
Book value per share	$	22.31		$	21.90		$	20.67
Tangible book value per share	$	18.51		$	18.10		$	16.82

View source version on businesswire.com: https://www.businesswire.com/news/home/20210426005832/en/

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

Source: RBB Bancorp

Press Release Details

RBB Bancorp Reports First Quarter Earnings for 2021