Exhibit 99.1

Press Release

For Immediate Release

 

 

Contacts:

Yee Phong (Alan) Thian

 

 

Chairman, President and CEO

 

 

(626) 307-7559

 

 

David Morris

 

 

Executive Vice President and CFO

 

 

(714) 670-2488

 

RBB Bancorp Reports Second Quarter Earnings for 2018

Conference Call and Webcast Scheduled for Tuesday, July 24, 2018 at

11:00 a.m. Pacific Time/2:00 p.m. Eastern Time

Net income was $9.4 million, or $0.54 diluted earnings per share

Total loans, including loans held for sale, increased by $120.5 million, or 33.4% annualized growth, from the end of the prior quarter

Total deposits increased by $50.9 million, or 14.9% annualized growth, from the end of the prior quarter

Received Bank Enterprise Award by the Department of Treasury

Los Angeles, CA, July 23, 2018 – 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 June 30, 2018.

The Company reported net income of $9.4 million, or $0.54 diluted earnings per share, for the three months ended June 30, 2018, compared to net income of $8.8 million, or $0.52 diluted earnings per share, and $8.5 million, or $0.62 diluted earnings per share, for the three months ended March 31, 2018 and June 30, 2017, respectively.

“We are very pleased with our operating performance for the second quarter,” said Mr. Alan Thian, Chairman, President and CEO. “We delivered another solid quarter of net income, driven by continued momentum in mortgage originations, improved fee income, strong credit quality and careful management of expenses. Our loan pipeline remains strong and we are ramping up our SBA loan production, which is approaching historical levels, although we are seeing an elevated level of SBA loan payoffs impacting our servicing income.

“We are proud to receive an award from the Department of Treasury’s Bank Enterprise Award Program as a result of our community investments in the markets that we serve,” added Mr. Thian. “We also look forward to closing the previously announced acquisition of First American International Corp. in the second half of this year.”    

Key Performance Ratios

Net income of $9.4 million for the second quarter of 2018 produced an annualized return on average assets of 2.18%, an annualized return on average tangible common equity of 15.13%, and an annualized return on average equity of 13.45%. This compares to an annualized return on average assets of 2.15%, an annualized return on average tangible common equity of 15.01%, and an annualized return on average equity of 13.27% for the first quarter of 2018.  The efficiency ratio for the second quarter of 2018 was 39.72%, compared to 43.85% for the prior quarter.


 

Net Interest Income and Net Interest Margin

Net interest income, before provision for loan losses, was $17.8 million for the second quarter of 2018, compared to $16.4 million for the first quarter of 2018.  The increase was primarily attributable to an 11 basis point increase in the net interest margin, combined with a $69.9 million increase in average earning assets.  Accretion of purchase discounts contributed $921,000 to net interest income in the second quarter of 2018, compared to $353,000 in the first quarter of 2018. The increase in accretion income was due to increased loan payoff activity in our purchased loan pools.

Compared to the second quarter of 2017, net interest income, before provision for loan losses, increased from $14.0 million. The increase was primarily attributable to a $236.7 million increase in average earning assets, combined with a 35 basis point increase in the net interest margin.

Net interest margin was 4.37% for the second quarter of 2018, an increase from 4.26% in the first quarter of 2018. The increase was primarily attributable to a 24 basis point increase in the yield on earning assets resulting from higher loan discount accretion and higher yields on loans, partially offset by a higher cost of deposits.  Loan discount accretion contributed 23 basis points to the net interest margin in the second quarter of 2018, compared to 9 basis points in the first quarter of 2018.

Noninterest Income

Noninterest income was $2.8 million for the second quarter of 2018, an increase of $338,000 from $2.5 million in the first quarter of 2018.  In the second quarter, gain on loan sales increased by $270,000.

The Company sold $52.9 million in mortgage loans for a net gain of $1.2 million during the quarter ended June 30, 2018, compared to $38.9 million in mortgage loans for a net gain of $983,000 during the quarter ended March 31, 2018. The Company originated $105.8 million in mortgage loans for sale for the quarter ended June 30, 2018, compared with $76.0 million during the quarter ended March 31, 2018.

The Company sold $18.2 million in SBA loans for a net gain of $885,000 during the second quarter of 2018, compared to $17.3 million in SBA loans sold for a net gain of $833,000 during the first quarter of 2018.  SBA loan originations for the second quarter were $11.1 million, compared to $4.6 million for the first quarter of 2018. The increase in SBA loan originations was attributable to the hiring of new SBA business development officers.

Compared to the second quarter of 2017, noninterest income decreased by $382,000. The decrease was primarily attributable to a $204,000 decline in gain on loan sales, and a decline of $200,000 in service charges, fees and other.

Noninterest Expense

Noninterest expense for the second quarter of 2018 was $8.2 million, compared to $8.3 million for the first quarter of 2018.  The decrease was primarily attributable to a $242,000 decrease in salaries and employee benefits expense, partially offset by an increase in legal and professional expenses of $165,000.

Compared to the second quarter of 2017, noninterest expense increased from $7.0 million. The $1.2 million increase was primarily due to an increase in salaries and employee benefits of $466,000, an increase in occupancy and equipment expenses of $107,000, an increase in data processing costs of $33,000, an increase in legal and professional expenses of $127,000 and an increase in other expenses of $508,000.  The increase in salary expense is attributable to additional staff for expansion.  The increase in occupancy expense is mainly due to rent at our Irvine location and temporary space for units pending the completion of our new headquarters office. The increase in other expenses is attributable to merger expenses of $183,000 and provision for unfunded commitments of $376,000.

Income Taxes

The effective tax rate was 19.5% (including the impact of a deduction for stock options exercised in the amount of $1.1 million) for the three months ended June 30, 2018, 15.2% (including the impact of a deduction for stock options exercised in the amount of $1.4 million) for the three months ended March 31, 2018, and 40.9% for the three months ended June 30, 2017.  

Loan Portfolio

Loans held for investment, net of deferred fees and discounts, totaled $1.28 billion as of June 30, 2018, an increase of $22.2 million, or 7.04% annualized growth, from $1.26 billion at March 31, 2018, and an increase of $138.1 million, or 12.05%, from June 30, 2017.  The increase in loans held for investment from the end of the prior quarter was primarily attributable to growth in the commercial real estate and residential real estate portfolios.

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Mortgage loans held for sale were $281.8 million as of June 30, 2018, an increase of $98.4 million from $183.4 million at March 31, 2018.  

Deposits

Deposits were $1.42 billion at June 30, 2018, an increase of $50.9 million, or 14.86% annualized growth, from $1.37 billion at March 31, 2018, and an increase of $146.0 million, or 11.42%, from June 30, 2017. The increase in total deposits from the end of the prior quarter was attributable to growth in interest-bearing non-maturity deposits and certificates of deposit, partially offset by decreases in noninterest-bearing demand deposits.

Noninterest-bearing deposits decreased to $306.4 million as of June 30, 2018, compared to $316.0 million at March 31, 2018.  The decrease is due to one large customer moving noninterest-bearing deposits to money market deposits.  Compared to June 30, 2017 noninterest-bearing deposits increased $90.7 million from $215.7 million.  

Asset Quality

Nonperforming assets totaled $7.0 million, or 0.38% of total assets at June 30, 2018, an increase from $4.8 million, or 0.28%, of total assets at March 31, 2018.  Nonperforming assets consist of Other Real Estate Owned (foreclosed properties), loans modified under troubled debt restructurings (TDR), non-accrual loans, and loans past due 90 days or more and still accruing interest. Nonperforming assets exclude purchase credit impaired (PCI) loans acquired in prior acquisitions.  The increase in nonperforming assets was primarily due to an increase of $2.1 million consisting of two TDR loans which are still performing.

Loans held-for-investment 30 to 89 days past due decreased to $1.1 million at June 30, 2018, from $2.2 million at March 31, 2018.  

There were no net charge-offs during the second quarter of 2018.

The Company recorded a provision for loan losses of $700,000 for the second quarter of 2018, which was primarily attributable to the growth in total average loans during the quarter.  The Company recorded a provision for loan losses of $184,000 during the first quarter of 2018 and a recapture of $4.2 million during the second quarter of 2017.

The allowance for loan losses totaled $14.7 million, or 1.14% of total loans held for investment, at June 30, 2018, compared with $14.0 million, or 1.11%, of total loans at March 31, 2018.  

Properties

Our headquarters office is located at 660 South Figueroa Street, Suite 1888, Los Angeles, California. It is in downtown Los Angeles at “Metro Center” and houses our risk management unit, including compliance and BSA groups, and our single-family residential mortgage group. The lease expired in May 2018. In October 2017, the Company signed a lease for a new headquarters office at 1055 Wilshire Boulevard, Suite 1220, Los Angeles, California, which a portion of the staff has moved into. However, we will designate this location as our headquarters in the fourth quarter 2018.  In February 2018, the Company signed a lease for a new branch in Irvine, California which we expect to occupy in September 2018.  

Corporate Overview

RBB Bancorp is a $1.8 billion in assets financial holding company headquartered in Los Angeles, California. Its wholly-owned subsidiary, the Bank, is a full service commercial bank which provides business banking services to the Asian-American communities in Los Angeles County, Orange County, Ventura County and in Las Vegas, Nevada, including 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, trade finance and a full range of depository accounts. The Bank has ten branches in Los Angeles County, located in downtown Los Angeles, San Gabriel, Torrance, Rowland Heights, Monterey Park, Silver Lake, Arcadia, Cerritos, Diamond Bar, and west Los Angeles, two branches in Ventura County, located in Oxnard and Westlake Village, and one branch in Las Vegas, Nevada. The Company’s administrative and lending center is located at 123 E. Valley Blvd., San Gabriel, California 91176, and its finance and operations center is located at 7025 Orangethorpe Avenue, Buena Park, California 90621. RBB’s website address is www.royalbusinessbankusa.com.

Conference Call

Management will hold a conference call at 11:00 a.m. PST/2:00 p.m. EST on Tuesday, July 24, 2018, to discuss the Company’s second quarter 2018 financial results.

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To listen to the conference call, please dial 1-833-659-7620 or 1-430-775-1348, passcode 3679019. A replay of the call will be made available at 1-855-859-2056 or 1-404-537-3406, passcode 3679017, approximately one hour after the conclusion of the call and will remain available through July 31, 2018.

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 the Company’s 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 within the meaning of the Private Securities Litigation Reform Act of 1995, including 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; the costs or effects of acquisitions or dispositions we may make, including First American International Corporation (“FAIC”), 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; 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 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, 2017, and particularly the discussion of risk factors within that document. The Company does not undertake, and specifically disclaims any obligation, to update

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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.

 

Additional Information about the Proposed Acquisition of FAIC

This press release does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval.  In connection with the proposed acquisition transaction, the Company intends to file a registration statement on Form S-4 (the “Registration Statement”) with the SEC, which will include a prospectus of RBB Bancorp and a proxy statement of FAIC (collectively, the “proxy statement/prospectus”).  SHAREHOLDERS OF FAIC AND RBB BANCORP ARE ENCOURAGED TO READ THE REGISTRATION STATEMENT AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC, AS WELL AS SUPPLEMENTS TO THOSE DOCUMENTS, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED ACQUISITION.  Investors and security holders will be able to obtain the documents, and any other documents RBB Bancorp has filed with the SEC, free of charge at the SEC’s website, www.sec.gov.  In addition, documents filed with the SEC by RBB Bancorp will be available free of charge by (1) accessing RBB Bancorp’s website at www.royalbusinessbankusa.com under the “Investor Relations” link and then under the heading “SEC Filings”, (2) writing RBB Bancorp at 7025 Orangethorpe Avenue, Buena Park, CA 90621, Attention: Investor Relations, or (3) writing FAIC at 79 Bayard Street, New York, NY 10013, Attention: Corporate Secretary.

The directors, executive officers and certain other members of management and employees of the Company may be deemed to be participants in the solicitation of proxies in respect of the proposed acquisition.  Information about the Company’s directors and executive officers is included in the definitive proxy statement for its 2018 annual meeting of RBB Bancorp shareholders, which was filed with the SEC on April 23, 2018.  The directors, executive officers and certain other members of management and employees of FAIC may also be deemed to be participants in the solicitation of consents in favor of the acquisition from the shareholders of FAIC.  Additional information regarding the interests of those participants and other persons who may be deemed participants in the transaction may be obtained by reading the proxy statement/prospectus regarding the proposed acquisition when it becomes available.  Free copies of this document may be obtained as described in the preceding paragraph.

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RBB BANCORP AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(Dollars in thousands)

 

 

 

June 30,

 

 

March 31,

 

 

December 31,

 

 

September 30,

 

 

June 30,

 

 

 

2018

 

 

2018

 

 

2017

 

 

2017

 

 

2017

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

 

$

72,780

 

 

$

53,535

 

 

$

70,048

 

 

$

69,552

 

 

$

104,366

 

Federal funds sold and other cash equivalents

 

 

 

 

 

25,000

 

 

 

80,000

 

 

 

96,500

 

 

 

58,500

 

Total cash and cash equivalents

 

 

72,780

 

 

 

78,535

 

 

 

150,048

 

 

 

166,052

 

 

 

162,866

 

Interest-bearing deposits in other financial

   institutions

 

 

600

 

 

 

600

 

 

 

600

 

 

 

100

 

 

 

100

 

Investment securities available for sale

 

 

61,299

 

 

 

82,848

 

 

 

64,957

 

 

 

55,697

 

 

 

40,241

 

Investment securities held to maturity

 

 

9,986

 

 

 

9,998

 

 

 

10,009

 

 

 

5,191

 

 

 

6,199

 

Mortgage loans held for sale

 

 

281,755

 

 

 

183,391

 

 

 

125,847

 

 

 

125,704

 

 

 

83,263

 

Loans held for investment

 

 

1,284,082

 

 

 

1,261,928

 

 

 

1,249,074

 

 

 

1,196,522

 

 

 

1,146,005

 

Allowance for loan losses

 

 

(14,657

)

 

 

(13,957

)

 

 

(13,773

)

 

 

(11,420

)

 

 

(10,627

)

Net loans held for investment

 

 

1,269,425

 

 

 

1,247,971

 

 

 

1,235,301

 

 

 

1,185,102

 

 

 

1,135,378

 

Premises and equipment, net

 

 

7,502

 

 

 

6,687

 

 

 

6,583

 

 

 

6,300

 

 

 

6,441

 

Federal Home Loan Bank (FHLB) stock

 

 

7,738

 

 

 

6,770

 

 

 

6,770

 

 

 

6,770

 

 

 

6,770

 

Net deferred tax assets

 

 

6,738

 

 

 

6,460

 

 

 

6,086

 

 

 

9,517

 

 

 

10,214

 

Income tax receivable

 

 

2,520

 

 

 

272

 

 

 

272

 

 

 

 

 

 

 

Other real estate owned (OREO)

 

 

293

 

 

 

293

 

 

 

293

 

 

 

293

 

 

 

833

 

Cash surrender value of life insurance

 

 

33,180

 

 

 

32,980

 

 

 

32,782

 

 

 

32,578

 

 

 

32,358

 

Goodwill

 

 

29,940

 

 

 

29,940

 

 

 

29,940

 

 

 

29,940

 

 

 

29,940

 

Servicing assets

 

 

6,134

 

 

 

5,979

 

 

 

5,957

 

 

 

5,370

 

 

 

4,661

 

Core deposit intangibles

 

 

1,280

 

 

 

1,357

 

 

 

1,438

 

 

 

1,525

 

 

 

1,612

 

Accrued interest and other assets

 

 

25,702

 

 

 

21,023

 

 

 

14,176

 

 

 

12,575

 

 

 

12,723

 

Total assets

 

$

1,816,872

 

 

$

1,715,104

 

 

$

1,691,059

 

 

$

1,642,714

 

 

$

1,533,599

 

Liabilities and shareholders' equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing demand

 

$

306,362

 

 

$

316,047

 

 

$

285,690

 

 

$

287,574

 

 

$

215,716

 

Savings, NOW and money market accounts

 

 

424,261

 

 

 

399,892

 

 

 

411,663

 

 

 

362,018

 

 

 

348,627

 

Time deposits

 

 

693,783

 

 

 

657,565

 

 

 

639,928

 

 

 

668,700

 

 

 

714,105

 

Total deposits

 

 

1,424,406

 

 

 

1,373,504

 

 

 

1,337,281

 

 

 

1,318,292

 

 

 

1,278,448

 

Reserve for unfunded commitments

 

 

483

 

 

 

575

 

 

 

282

 

 

 

489

 

 

 

517

 

Income tax payable

 

 

 

 

 

1,563

 

 

 

 

 

 

 

 

 

 

FHLB advances

 

 

40,000

 

 

 

 

 

 

25,000

 

 

 

 

 

 

 

Long-term debt

 

 

49,601

 

 

 

49,564

 

 

 

49,528

 

 

 

49,492

 

 

 

49,456

 

Subordinated debentures

 

 

3,470

 

 

 

3,447

 

 

 

3,424

 

 

 

3,402

 

 

 

3,379

 

Accrued interest and other liabilities

 

 

12,710

 

 

 

10,629

 

 

 

10,368

 

 

 

10,708

 

 

 

9,462

 

Total liabilities

 

 

1,530,670

 

 

 

1,439,282

 

 

 

1,425,883

 

 

 

1,382,383

 

 

 

1,341,262

 

Shareholders' equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shareholder's equity

 

 

287,509

 

 

 

276,862

 

 

 

265,619

 

 

 

260,468

 

 

 

192,427

 

Accumulated other comprehensive income

   (loss) - Net of tax

 

 

(1,307

)

 

 

(1,040

)

 

 

(443

)

 

 

(137

)

 

 

(90

)

Total shareholders' equity

 

 

286,202

 

 

 

275,822

 

 

 

265,176

 

 

 

260,331

 

 

 

192,337

 

Total liabilities and stockholders’

   equity

 

$

1,816,872

 

 

$

1,715,104

 

 

$

1,691,059

 

 

$

1,642,714

 

 

$

1,533,599

 

 

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RBB BANCORP AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

(Dollars in thousands, except per share amounts)

 

 

 

Three Months Ended

 

 

 

June 30, 2018

 

 

March 31, 2018

 

 

June 30, 2017

 

Interest and dividend income:

 

 

 

 

 

 

 

 

 

 

 

 

Interest and fees on loans

 

$

21,132

 

 

$

19,074

 

 

$

16,759

 

Interest on interest-bearing deposits

 

 

209

 

 

 

187

 

 

 

209

 

Interest on investment securities

 

 

603

 

 

 

560

 

 

 

313

 

Dividend income on FHLB stock

 

 

134

 

 

 

119

 

 

 

82

 

Interest on federal funds sold and other

 

 

206

 

 

 

237

 

 

 

158

 

Total interest income

 

 

22,284

 

 

 

20,177

 

 

 

17,521

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

Interest on savings deposits, NOW and money market accounts

 

 

998

 

 

 

702

 

 

 

575

 

Interest on time deposits

 

 

2,410

 

 

 

2,046

 

 

 

1,993

 

Interest on subordinated debentures and other

 

 

920

 

 

 

913

 

 

 

907

 

Interest on other borrowed funds

 

 

129

 

 

 

71

 

 

 

12

 

Total interest expense

 

 

4,457

 

 

 

3,732

 

 

 

3,487

 

Net interest income

 

 

17,827

 

 

 

16,445

 

 

 

14,034

 

Provision for loan losses

 

 

700

 

 

 

184

 

 

 

(4,188

)

Net interest income after provision for loan losses

 

 

17,127

 

 

 

16,261

 

 

 

18,222

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

 

Service charges, fees and other

 

 

446

 

 

 

466

 

 

 

646

 

Gain on sale of loans

 

 

2,085

 

 

 

1,815

 

 

 

2,289

 

Loan servicing fees, net of amortization

 

 

58

 

 

 

(31

)

 

 

(5

)

Recoveries on loans acquired in business combinations

 

 

5

 

 

 

6

 

 

 

29

 

Increase in cash surrender value of life insurance

 

 

199

 

 

 

199

 

 

 

216

 

 

 

 

2,793

 

 

 

2,455

 

 

 

3,175

 

Noninterest expense:

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

 

4,709

 

 

 

4,951

 

 

 

4,243

 

Occupancy and equipment expenses

 

 

834

 

 

 

791

 

 

 

727

 

Data processing

 

 

487

 

 

 

473

 

 

 

454

 

Legal and professional

 

 

423

 

 

 

258

 

 

 

296

 

Amortization of intangibles

 

 

77

 

 

 

81

 

 

 

87

 

Other expenses

 

 

1,661

 

 

 

1,735

 

 

 

1,153

 

 

 

 

8,191

 

 

 

8,289

 

 

 

6,960

 

Income before income taxes

 

 

11,729

 

 

 

10,427

 

 

 

14,437

 

Income tax expense

 

 

2,292

 

 

 

1,580

 

 

 

5,901

 

Net income

 

$

9,437

 

 

$

8,847

 

 

$

8,536

 

Net income per share

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.58

 

 

$

0.55

 

 

$

0.67

 

Diluted

 

$

0.54

 

 

$

0.52

 

 

$

0.62

 

 


7


 

RBB BANCORP AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

(Dollars in thousands, except per share amounts)

 

 

 

Six Months Ended

 

 

 

June 30,

 

 

 

2018

 

 

2017

 

Interest and dividend income:

 

 

 

 

 

 

 

 

Interest and fees on loans

 

$

40,206

 

 

$

32,792

 

Interest on interest-bearing deposits

 

 

395

 

 

 

360

 

Interest on investment securities

 

 

1,162

 

 

 

591

 

Dividend income on FHLB stock

 

 

253

 

 

 

235

 

Interest on federal funds sold and other

 

 

443

 

 

 

302

 

Total interest income

 

 

42,459

 

 

 

34,280

 

Interest expense:

 

 

 

 

 

 

 

 

Interest on savings deposits, NOW and money market accounts

 

 

1,700

 

 

 

1,049

 

Interest on time deposits

 

 

4,456

 

 

 

3,842

 

Interest on subordinated debentures and other

 

 

1,833

 

 

 

1,812

 

Interest on other borrowed funds

 

 

200

 

 

 

29

 

Total interest expense

 

 

8,189

 

 

 

6,732

 

Net interest income

 

 

34,270

 

 

 

27,548

 

Provision (recapture) for loan losses

 

 

884

 

 

 

(4,188

)

Net interest income after provision (recapture) for loans losses

 

 

33,386

 

 

 

31,736

 

Noninterest income:

 

 

 

 

 

 

 

 

Service charges, fees and other

 

 

911

 

 

 

1,106

 

Gain on sale of loans

 

 

3,900

 

 

 

3,786

 

Loan servicing fees, net of amortization

 

 

27

 

 

 

257

 

Recoveries on loans acquired in business combinations

 

 

11

 

 

 

57

 

Increase in cash surrender value of life insurance

 

 

398

 

 

 

401

 

 

 

 

5,247

 

 

 

5,607

 

Noninterest expense:

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

 

9,660

 

 

 

8,426

 

Occupancy and equipment expenses

 

 

1,626

 

 

 

1,471

 

Data processing

 

 

960

 

 

 

806

 

Legal and professional

 

 

680

 

 

 

(91

)

Amortization of intangibles

 

 

158

 

 

 

181

 

Other expenses

 

 

3,396

 

 

 

2,745

 

 

 

 

16,480

 

 

 

13,538

 

Income before income taxes

 

 

22,153

 

 

 

23,805

 

Income tax expense

 

 

3,872

 

 

 

9,776

 

Net income

 

$

18,281

 

 

$

14,029

 

Net income per share

 

 

 

 

 

 

 

 

Basic

 

$

1.13

 

 

$

1.09

 

Diluted

 

$

1.06

 

 

$

1.02

 

Cash Dividends declared per common share

 

$

0.17

 

 

$

0.30

 

 

8


 

RBB BANCORP AND SUBSIDIARIES

AVERAGE BALANCE SHEET AND NET INTEREST INCOME

(Unaudited)

(Dollars in thousands, except per share amounts)

 

 

For the three months ended

 

 

 

June 30, 2018

 

 

March 31, 2018

 

 

June 30, 2017

 

 

 

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)

 

$

79,065

 

 

$

549

 

 

 

2.78

%

 

$

97,741

 

 

$

543

 

 

 

2.25

%

 

$

134,089

 

 

$

449

 

 

 

1.34

%

Securities (2)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Available for sale

 

 

74,836

 

 

 

519

 

 

 

2.78

%

 

 

70,742

 

 

 

477

 

 

 

2.74

%

 

 

40,618

 

 

 

253

 

 

 

2.50

%

Held to maturity

 

 

9,992

 

 

 

92

 

 

 

3.71

%

 

 

10,005

 

 

 

92

 

 

 

3.75

%

 

 

6,204

 

 

 

60

 

 

 

3.88

%

Mortgage loans held for sale

 

 

218,261

 

 

 

2,428

 

 

 

4.46

%

 

 

158,820

 

 

 

1,838

 

 

 

4.69

%

 

 

71,356

 

 

 

848

 

 

 

4.77

%

Loans held for investment: (3)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Real estate

 

 

876,792

 

 

 

12,635

 

 

 

5.78

%

 

 

829,971

 

 

 

11,097

 

 

 

5.42

%

 

 

768,585

 

 

 

10,645

 

 

 

5.56

%

Commercial (4)

 

 

377,077

 

 

 

6,069

 

 

 

6.46

%

 

 

398,811

 

 

 

6,139

 

 

 

6.24

%

 

 

378,436

 

 

 

5,266

 

 

 

5.58

%

Total loans

 

 

1,253,869

 

 

 

18,704

 

 

 

5.98

%

 

 

1,228,782

 

 

 

17,236

 

 

 

5.69

%

 

 

1,147,021

 

 

 

15,911

 

 

 

5.56

%

Total earning assets

 

 

1,636,023

 

 

$

22,292

 

 

 

5.47

%

 

 

1,566,090

 

 

$

20,187

 

 

 

5.23

%

 

 

1,399,288

 

 

$

17,521

 

 

 

5.02

%

Noninterest-earning assets

 

 

100,442

 

 

 

 

 

 

 

 

 

 

 

102,693

 

 

 

 

 

 

 

 

 

 

 

95,434

 

 

 

 

 

 

 

 

 

Total assets

 

$

1,736,465

 

 

 

 

 

 

 

 

 

 

$

1,668,783

 

 

 

 

 

 

 

 

 

 

$

1,494,722

 

 

 

 

 

 

 

 

 

Interest-bearing liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOW and money market deposits

 

$

387,116

 

 

$

968

 

 

 

1.00

%

 

$

360,151

 

 

$

667

 

 

 

0.75

%

 

$

302,483

 

 

$

536

 

 

 

0.71

%

Savings deposits

 

 

29,499

 

 

 

30

 

 

 

0.39

%

 

 

32,648

 

 

 

35

 

 

 

0.44

%

 

 

34,203

 

 

 

39

 

 

 

0.46

%

Time deposits

 

 

666,493

 

 

 

2,410

 

 

 

1.45

%

 

 

645,654

 

 

 

2,046

 

 

 

1.29

%

 

 

701,314

 

 

 

1,993

 

 

 

1.14

%

Total interest-bearing deposits

 

 

1,083,108

 

 

 

3,408

 

 

 

1.26

%

 

 

1,038,453

 

 

 

2,748

 

 

 

1.07

%

 

 

1,038,000

 

 

 

2,568

 

 

 

0.99

%

FHLB short-term advances

 

 

34,011

 

 

 

129