WHITTIER, Calif., Aug. 07, 2015 (GLOBE NEWSWIRE) -- Friendly Hills Bank (the “bank”) (OTCBB: FHLB) reported results for the second quarter of 2015.
For the six month period ending June 30, 2015, the bank reported net income of $174,000 or $0.11 per diluted share of common stock. This figure includes a $22,000 increase in the value of the interest rate caps, a $31,000 gain on securities sold, and a $43,000 gain on other real estate owned. The bank reported net income of $268,000 or $0.17 per diluted share of common stock for the six months ended June 30, 2014. This figure includes a $68,000 loan referral fee, a $45,000 increase in the value of the interest rate caps, and a $17,000 gain on securities sold.
As of June 30, 2015, the bank reported total assets of $129.5 million, an 18% increase from $110.0 million as of June 30, 2014. The bank’s loan portfolio, net of unearned income, increased 19% from $56.8 million as of June 30, 2014, to $67.8 million as of June 30, 2015. The portfolio remains diversified with $33.0 million or 49% in Commercial & Industrial Loans to local businesses (including $19.7 million in Owner Occupied Commercial Real Estate Loans), $16.9 million or 25% in Residential Real Estate Loans to investors and $9.6 million or 14% in Commercial Real Estate Loans to investors. The bank has an additional $19.2 million in unfunded loan commitments.
The bank’s overall deposit base has increased 15% in the twelve months ended June 30, 2015, from $87.7 million as of June 30, 2014, to $100.9 million as of June 30, 2015. Non-interest bearing deposits continue to form a substantial part of the deposit base (47%), growing from $36.0 million to $47.2 million as of June 30, 2015. During the same time period interest-bearing deposits increased from $51.7 million to $53.7 million on June 30, 2015. The bank has no deposits which were sourced through brokers or other wholesale funding sources.
At June 30, 2015, shareholders’ equity was $15.1 million and the bank’s total risk-based capital ratio was 18%, 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.
Effective April 1, 2015, the bank established a payroll division which provides payroll and timekeeping solutions to small business clients. To facilitate this expansion of product lines the bank acquired the service contracts of a local payroll provider and employed the operations staff of the same entity.
“Despite challenging market conditions attributable to the continued low interest rate environment the bank was able to attain meaningful growth in both loans and deposits during the second quarter,” commented Jeffrey K. Ball, Chief Executive Officer. “This growth is expected to improve the core earnings of the bank and is complimented by the additional fee income associated with our recent expansion into payroll services. Integration of the payroll services is progressing well and we anticipate strong revenue synergy opportunities which will help to diversify our revenue sources beyond traditional net interest income. This is a meaningful component in our effort to increase earnings and build sustainable shareholder value.”
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 and a loan production office in Irvine, 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) | |||||||||||||
| 6/30/15 | 12/31/14 | 6/30/14 | |||||||||||
| ASSETS | |||||||||||||
| Cash and due from banks | $ | 4,058 | $ | 4,912 | $ | 4,981 | |||||||
| Interest bearing deposits with other financial institutions | 9,515 | 5,617 | 5,682 | ||||||||||
| Cash and Cash Equivalents | 13,573 | 10,529 | 10,663 | ||||||||||
| Investment securities available-for-sale | 43,030 | 42,829 | 38,916 | ||||||||||
| Federal Home Loan Bank stock | 753 | 677 | 677 | ||||||||||
| Federal Reserve Bank stock | 455 | 393 | 0 | ||||||||||
| Loans, net of unearned income | 67,796 | 60,868 | 56,815 | ||||||||||
| Allowance for loan losses | (1,595 | ) | (1,595 | ) | (1,587 | ) | |||||||
| Net Loans | 66,201 | 59,273 | 55,228 | ||||||||||
| Premises and equipment, net | 288 | 362 | 526 | ||||||||||
| Accrued interest receivable and other assets | 5,180 | 5,840 | 3,964 | ||||||||||
| Total Assets | $ | 129,480 | $ | 119,903 | $ | 109,974 | |||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||||
| Liabilities | |||||||||||||
| Deposits | |||||||||||||
| Noninterest-bearing deposits | $ | 47,207 | $ | 39,220 | $ | 36,036 | |||||||
| Interest-bearing deposits | 53,672 | 56,339 | 51,710 | ||||||||||
| Total Deposits | 100,879 | 95,559 | 87,746 | ||||||||||
| FHLB advances | 13,000 | 8,750 | 8,750 | ||||||||||
| Accrued interest payable and other liabilities | 466 | 422 | 376 | ||||||||||
| Total Liabilities | 114,345 | 104,731 | 96,872 | ||||||||||
| Shareholders’ Equity | |||||||||||||
| Common stock, no par value, 10,000,000 shares authorized: | |||||||||||||
| 1,616,000 shares issued and outstanding | 15,958 | 15,958 | 15,958 | ||||||||||
| Additional paid-in-capital | 1,091 | 1,091 | 1,091 | ||||||||||
| Accumulated deficit | (1,871 | ) | (2,045 | ) | (4,028 | ) | |||||||
| Accumulated other comprehensive income (loss) | (43 | ) | 168 | 81 | |||||||||
| Total Shareholders’ Equity | 15,135 | 15,172 | 13,102 | ||||||||||
| Total Liabilities and Shareholders’ Equity | $ | 129,480 | $ | 119,903 | $ | 109,974 | |||||||
| Book Value Per Share | $ | 9.37 | $ | 9.39 | $ | 8.11 | |||||||
| Friendly Hills Bank | |||||||||
| Statements of Operations (Unaudited) | |||||||||
| (in thousands, except per share information) | |||||||||
| For the six | For the six | ||||||||
| months ended | months ended | ||||||||
| 6/30/15 | 6/30/14 | ||||||||
| Interest Income | $ | 2,128 | $ | 2,077 | |||||
| Interest Expense | (159 | ) | (187 | ) | |||||
| Net Interest Income | 1,969 | 1,890 | |||||||
| Provision for Loan Losses | 0 | 0 | |||||||
| Net Interest Income after Provision for Loan Losses | 1,969 | 1,890 | |||||||
| Noninterest Income | 177 | 143 | |||||||
| Noninterest Expense | (1,974 | ) | (1,895 | ) | |||||
| Non-Recurring Items | 96 | 130 | |||||||
| Income before Provision for Income Taxes | 268 | 268 | |||||||
| Provision for Income Taxes | (94 | ) | 0 | ||||||
| Net Income | $ | 174 | $ | 268 | |||||
| Basic and Diluted Earnings Per Share | $ | 0.11 | $ | 0.17 | |||||