Friendly Hills Bank Reports Second Quarter Results


WHITTIER, Calif., Aug. 06, 2018 (GLOBE NEWSWIRE) -- Friendly Hills Bank (the “bank”) (OTCBB:FHLB) reported results for the second quarter of 2018.

For the six month period ending June 30, 2018, the bank reported net income of $380,000 or $0.19 per diluted share of common stock. The bank reported net income of $323,000 or $0.17 per diluted share of common stock for the six months ended June 30, 2017.    

As of June 30, 2018, the bank reported total assets of $154.5 million, a slight decrease from $155.1 million as of June 30, 2017. The bank’s loan portfolio, net of unearned income, decreased 7% from $85.0 million as of June 30, 2017, to $79.1 million as of June 30, 2018. The portfolio remains diversified with $26.6 million or 33% in Commercial & Industrial Loans to local businesses (including $17.9 million in Owner Occupied Commercial Real Estate Loans), $22.9 million or 29% in Residential Real Estate Loans to investors and $23.5 million or 29% in Commercial Real Estate Loans to investors. The bank has an additional $26.8 million in unfunded loan commitments.

The bank’s overall deposit base has decreased 1% in the twelve months ended June 30, 2018, from $117.3 million as of June 30, 2017, to $116.0 million as of June 30, 2018. Non-interest bearing deposits remain a substantial part of the deposit base (39%), despite decreasing from $45.9 million as of June 30, 2017, to $45.2 million as of June 30, 2018.  During the same time period interest-bearing deposits decreased from $71.4 million as of June 30, 2017, to $70.8 million on June 30, 2018.  

At June 30, 2018, shareholders’ equity was $16.1 million and the bank’s total risk-based capital ratio was 19%, significantly exceeding the “well-capitalized” level of 10% prescribed under regulatory requirements. The bank also continues to maintain substantial liquidity positions, retaining significant balances of liquidity as well as available collateralized borrowings and other potential sources of liquidity.

“We are pleased to once again report an increase in earnings which are 18% higher than the same time period one year ago,” commented Jeffrey K. Ball, Chief Executive Officer. “Net Interest Income and overall Net Income are benefiting from the overall increase in interest rates and lower effective tax rates.  The core deposit base remains robust providing a low cost of funds despite higher than normal volatility. The company continues to maintain a strong balance sheet with solid liquidity and capital ratios that are well above the regulatory standards for well capitalized banks. Although lower underwriting standards persist across the market, particularly from non-bank competition, we have held steadfast to our sound underwriting strategies in the interest of long-term shareholder value and the company’s asset quality remains very high.”

Company Profile:
Friendly Hills Bank is a community bank which was formed to primarily serve the Southern California communities of eastern Los Angeles County and northern Orange County. The bank was established in 2006 by prominent members of the local community who were seeking an alternative to the larger financial institutions in the area. The bank is headquartered in Whittier, California with an additional branch office in Santa Fe Springs, California. For more information on the bank, please visit www.friendlyhillsbank.com or call 562-947-1920.

Forward Looking Statements:
The numbers in this press release are unaudited. Statements such as those regarding the anticipated development and expansion of Friendly Hills Bank's business, and the intent, belief or current expectations of the bank, its directors or its officers, are "forward looking" statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward looking statements. These risks and uncertainties include, but are not limited to, risks related to the local and national economy, the bank's performance, including its ability to generate loan and deposit growth, changes in interest rates, and regulatory matters.

 
Friendly Hills Bank
Balance Sheets (Unaudited)
(in thousands, except per share information)
        
   6/30/18 12/31/17 6/30/17
ASSETS      
Cash and due from banks$  4,268  $  12,634  $  3,746 
Interest bearing deposits with other financial institutions 17,327   5,130   20,408 
  Cash and Cash Equivalents 21,595   17,764   24,154 
Investment securities available-for-sale 47,157   53,131   39,857 
Federal Home Loan Bank stock 951   835   835 
Federal Reserve Bank stock 479   476   476 
Loans, net of unearned income 79,098   77,331   84,986 
Allowance for loan losses (1,525)  (1,525)  (1,525)
  Net Loans 77,573   75,806   83,461 
Premises and equipment, net 365   345     319 
Accrued interest receivable and other assets 6,332   6,109   5,996 
  Total Assets$154,452  $154,466  $155,098 
        
LIABILITIES AND SHAREHOLDERS’ EQUITY     
Liabilities      
Deposits      
 Noninterest-bearing deposits$45,201  $  47,057  $  45,888 
 Interest-bearing deposits 70,793   66,856   71,408 
  Total Deposits 115,994   113,913   117,296 
FHLB advances 21,750   23,000   21,000 
Accrued interest payable and other liabilities 654   1,256   424 
  Total Liabilities 138,398     138,169    138,720 
Shareholders’ Equity     
 Common stock, no par value, 10,000,000 shares authorized:     
 1,979,993 shares issued and outstanding 15,958   15,958   15,958 
 Additional paid-in-capital 1,293   1,091   1,091 
 Accumulated deficit 30   (350)  (623)
 Accumulated other comprehensive income (loss) (1,227)  (402)  (48)
  Total Shareholders’ Equity 16,054   16,297   16,378 
  Total Liabilities and Shareholders’ Equity$154,452  $154,466  $155,098 
        
Book Value Per Share$  8.11  $  8.40  $  8.45 
            


 
Friendly Hills Bank
Statements of Operations (Unaudited)
 (in thousands, except per share information)
      
   For the three For the three
   months ended months ended
   6/30/18 6/30/17
Interest Income$ 2,673  $ 2,462 
Interest Expense 232   168 
 Net Interest Income 2,441   2,294 
Provision for Loan Losses 0   0 
 Net Interest Income after Provision for Loan Losses   2,441      2,294    
Noninterest Income 234   244 
Noninterest Expense 2,150   2,012 
Non-Recurring Items 1   0 
Income before Provision for Income Taxes 526   526 
(Provision) Benefit for Income Taxes (146)  (203)
 Net Income$  380  $  323 
      
Basic and Diluted Earnings Per Share$  0.19  $  0.17 
        

Contacts:
Jeffrey K. Ball (President & CEO)
Viktor Uehlinger (EVP & CFO)
(562) 947-1920