American Business Bank Reports Record Quarterly Core Loan Growth

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LOS ANGELES–()–AMERICAN BUSINESS BANK (OTCQX: AMBZ) today reported net income of $9.1 million or $1.00 per fully diluted share for the second quarter of 2021 compared to $8.9 million or $0.99 per fully diluted share for the first quarter of 2021, an increase of 2%. For the quarter ended June 30, 2021 net income associated with the PPP program was $4.3 million or $0.47 per fully diluted share, an increase of 20% compared to $3.6 million or $0.39 per fully diluted share for the first quarter of 2021.

“The Bank realized exceptional loan growth in the second quarter of 2021 at a 30% annualized rate primarily from new relationships. Growth was diversified in owner and non-owner occupied commercial real estate and C&I loans across all of the regional offices. Business momentum remains strong as new relationships join the Bank which will also drive core deposit growth. The Bank’s level of demonstrated high service resonates with entrepreneurial owners coming out of the pandemic as larger banks struggle to deliver. Additional loan growth allows the net interest income to grow despite continued compression to the net interest margin in this low rate environment.

“ABB’s high level of participation in the PPP program places the bank in the upper echelon in the entire U.S. as measured by PPP loans as a percentage of total loans. The timing of PPP loan forgiveness has met expectations, and income from the program has enabled ABB to step up our community support with planned funding of a small business grant program to benefit minority and women-owned businesses.

“Additionally, we remain true to our original value proposition and culture to help guide and bank the best small to middle market companies in Southern California. Our ability to not only be excellent bankers in all the traditional sense, of deposits and loans as well as consultants and stewards, delivers an unmatched banking relationship,” said Leon Blankstein, ABB’s President, CEO and Director.

Net interest income for the second quarter of 2021 was $27.1 million, an 11% increase over the first quarter of 2021 as realized deferred fees on PPP loans increased by $1.2 million driven by an increase in PPP loan forgiveness. Interest income on loans, excluding PPP loan income, increased by $1.1 million in the second quarter of 2021 compared to the first quarter of 2021 as loans, excluding PPP loans, increased by an average of $82 million. Additionally, during the second quarter of 2021, the Bank recovered $342,000 of interest on a nonaccrual loan and a previously charged off loan. Interest income on the securities portfolio increased by $504,000 in the second quarter of 2021 compared to the first quarter of 2021, as investment securities increased by an average of $80 million. For the quarters ending June 30, 2021 and March 31, 2021, the cost of deposits was 0.06%. For the quarter ending June 30, 2021, there was no provision for loan losses as the economy continues to improve and the Bank received a recovery on a previously charged off loan. The allowance for loan losses as a percentage of loans, excluding PPP loans, was 1.40% at June 30, 2021.

Net income was $18.0 million or $1.98 per fully diluted share for the six months ended June 30, 2021, compared to $11.6 million or $1.30 per fully diluted share for the six months ended June 30, 2020. The increase was primarily due to $6.9 million of accelerated realization of net deferred PPP processing fees on forgiven PPP loans, an increase in interest on investment securities of $1.8 million as a result of an increase in investment securities and no provision for loan losses. This additional income was offset by a $2 million nonrecurring legal settlement expense and a $1.8 million increase in salary and bonus expense.

Net Interest Margin

Net interest margin for the second quarter of 2021 was 3.00% compared to 2.92% in the first quarter of 2021 and 2.88% in the second quarter of 2020. Excluding the impact of PPP loans the net interest margin was 2.75% for the second quarter of 2021 and 2.82% for the first quarter of 2021. The recovery of interest on nonaccrual/charged off loans in the second quarter increased the net interest margin by 0.04% and the loan yield by 0.06%. Without the acceleration of fees on forgiveness, the yield on PPP loans was 1.46% for the second quarter of 2021. The decrease in the net interest margin excluding the impact of PPP loans compared to the prior year is due to a decline of the core loan yield to 4.12% offset by loan growth and an increase in investment securities. As of June 30, 2021, approximately 47% of the Bank’s variable-rate loans are indexed to prime and 76% of these loans are at or above interest rate floors.

Net Interest Income

Net interest income increased for the second quarter of 2021 compared to second quarter of 2020 by $5.4 million, or 25%, and increased compared to the first quarter of 2021 by $2.6 million, or 11%. This was primarily due to the accelerated realization of net deferred PPP processing fees as 40% and 18% of PPP loans originated in 2020 were forgiven in the second quarter of 2021 and the first quarter of 2021, respectively. The Bank received $342,000 of interest on a payoff of a nonaccrual loan and in a full recovery of a charged off loan.

(Figures in $000s, except per share amounts) As of or For the
Six Months Ended:
As of or For the
Three Months Ended:
June 2021 June 2020 June 2021 March 2021
PPP loans – first round, net

$

152,827

$

675,666

$

152,827

$

424,327

PPP loans – second round, net

 

233,561

 

 

233,561

 

217,780

PPP Total Loans, net

$

386,388

$

675,666

$

386,388

$

642,107

 
1% Coupon Interest

$

2,930

$

1,381

$

1,403

$

1,527

Amortized fees

 

1,288

 

1,613

 

620

 

668

Accelerated fees

 

6,891

 

 

4,046

 

2,845

 
Total PPP loan income

$

11,109

$

2,994

$

6,069

$

5,040

Total PPP loan income after tax

$

7,835

$

2,117

$

4,280

$

3,555

Total PPP loan income after tax per share – diluted

$

0.86

$

0.24

$

0.47

$

0.39

As of July 8, 2021, approximately 79% of PPP loan balances originated in 2020 have been forgiven, approximately 9% of balances are in the forgiveness review or submission process and approximately 12% of balances have yet to apply for forgiveness.

On a year-to-date basis, net interest income was $51.6 million for the six months ended June 30, 2021, compared to $41.8 million for the same period a year ago. The increase of $9.8 million or 24% is primarily due to the accelerated realization of net deferred PPP processing fees on forgiven PPP loans of $6.9 million and an increase in interest on investment securities of $1.8 million as a result of an increase in investment securities.

Non Interest Income

Fluctuations in non-interest income between quarter and year-to-date are primarily due to Bank/Corporate owned life insurance (BOLI) income as a result of the decrease in the value of the policies that are invested in mutual funds. On a year-to-date basis, deposit fees increased $252,000 from the period a year ago due to growth in commercial business customers and lower earnings credit.

Non Interest Expense

For the second quarter of 2021, total non-interest expense increased $2.5 million compared to the first quarter of 2021 and second quarter of 2020 primarily due to a $2 million expense for settlement of a legal matter and an increase in bonus expense as a result of higher loan production. The efficiency ratio increased/decreased to 58% for the second quarter of 2021 compared to 54% for the first quarter of 2021 and 59% for the second quarter of 2020.

Full time equivalent employees at June 30, 2021 were 192 compared to 195 a year ago. Full time equivalent employees were 192 at March 31, 2021. The Bank has 35 relationship managers in seven offices, an increase over the year of five and the prior quarter of one. The higher mix of relationship managers to back office personnel is the result of technology implementations that continue in 2021.

On a year-to-date basis, non-interest expense for the six months ended June 30, 2021 increased $4.4 million or 17% compared to the same period a year ago, due to the settlement of a legal matter, an increase in salaries and bonus expense reflective of higher loan growth and PPP1 forgiveness with added expense for the deferred compensation plan (DCP) as a result of the market performance of DCP investment balances.

Balance Sheet

Total assets increased $27 million, or 1% from March 31, 2021 to $3.7 billion. Total loans, excluding PPP loans, increased $118 million, to $1.7 billion from the first quarter of 2021 as CRE loans increased by $56 million, C&I loan growth and line utilization increased by $37 million and residential real estate loans increased by $25 million. At June 30, 2021, the utilization rate for the Bank’s commercial lines of credit was 27% compared to 24% at March 31, 2021. Investment securities increased by $214 million from the first quarter of 2021 to $1.3 billion. During the second quarter, the Bank designated $73 million of municipal bonds from available-for-sale to held-to-maturity to reduce volatility to equity in a rising rate environment. The duration of the securities portfolio declined from 4.7 to 4.5 years from March 31, 2021 to June 30, 2021.

At June 30, 2021, the tangible common equity ratio was 7.0%; excluding PPP loans, the tangible common equity ratio was 7.9%.

On June 23, 2021, the Bank declared a ten percent stock dividend per common share to be payable on July 22, 2021 to shareholders of record at the close of business on June 23, 2021.

Asset Quality

Non-performing assets declined to $54,000 at June 30, 2021 from $2.2 million at March 31, 2021, representing 0.01% of total assets (excluding PPP loans). The Bank continues to have no Other Real Estate Owned. Loans that were past due, criticized and classifieds represented 0.00%, 4.24%, and 0.68%, respectively of total loans at June 30, 2021 compared to 0.00%, 6.02%, and 0.98%, respectively of total loans at March 31, 2021 (excluding PPP loans in all periods). As of June 30, 2021, the Bank had total specific reserve of $52,000 related to one $214,000 impaired loan relationship. As of June 30, 2021, the allowance for loan losses totaled $23.3 million, or 1.40% of total loans (excluding PPP loans); compared to 1.48% at March 31, 2021. All PPP loans are 100% guaranteed by the SBA and as such, no allowance for loan losses is allocated to these loans. The Bank is required to adopt CECL, or Current Expected Credit Loss, on January 1, 2023. During the second quarter of 2021, the Bank recorded no loan charge-offs and recoveries of $395,000.

In response to the COVID-19 pandemic, the Bank established a loan payment deferment program to assist its customers who are experiencing short-term financial or operational problems. As of June 30, 2021, there were no loans on a loan payment deferment program. As of March 31, 2021, there were five loans with a total principal balance of $11.2 million (0.5% of total loans) on a loan payment deferment program subsequently all have made their payments.

ABOUT AMERICAN BUSINESS BANK

American Business Bank, headquartered in downtown Los Angeles, offers a wide range of financial services to the business marketplace. Clients include wholesalers, manufacturers, service businesses, professionals and non-profits. American Business Bank has six Loan Production Offices in strategic locations including: North Orange County in Anaheim, Orange County in Irvine, South Bay in Torrance, San Fernando Valley in Woodland Hills, Riverside County in Corona and Inland Empire in Ontario.

FORWARD LOOKING STATEMENTS

This communication contains certain forward-looking information about American Business Bank that is intended to be covered by the safe harbor for “forward-looking statements” provided by the Private Securities Litigation Reform Act of 1995. Such statements include future financial and operating results, expectations, intentions and other statements that are not historical facts. Such statements are based on information available at the time of this communication and are based on current beliefs and expectations of the Bank’s management and are subject to significant risks, uncertainties and contingencies, many of which are beyond our control. Actual results may differ materially from those set forth in the forward-looking statements due to a variety of factors, including various risk factors. We are under no obligation (and expressly disclaim any such obligation) to update or alter our forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

American Business Bank
Figures in $000, except share and per share amounts
 
BALANCE SHEETS (unaudited)
 

June

 

March

 

December

 

June

2021

 

2021

 

2020

 

2020

Assets:
Cash and Due from Banks

$

74,242

 

$

38,637

 

$

44,334

 

$

68,072

 

Interest Earning Deposits in Other Financial Institutions

 

269,596

 

 

350,354

 

 

201,719

 

 

232,770

 

 
Investment Securities:
US Agencies

 

210,849

 

 

218,794

 

 

228,102

 

 

240,012

 

Mortgage Backed Securities

 

577,726

 

 

407,651

 

 

419,393

 

 

313,119

 

State and Municipals

 

213,729

 

 

270,161

 

 

279,045

 

 

133,128

 

US Treasuries

 

 

 

 

 

 

 

10,081

 

Corporate Bonds

 

10,966

 

 

8,848

 

 

12,725

 

 

19,502

 

Securities Available-for-Sale, at Fair Value

 

1,013,270

 

 

905,454

 

 

939,265

 

 

715,842

 

State and Municipals Securities Held-to-Maturity, at Amortized Cost

 

255,953

 

 

151,041

 

 

143,229

 

 

86,289

 

Federal Home Loan Bank Stock, at Cost

 

11,779

 

 

10,864

 

 

10,864

 

 

10,864

 

Total Investment Securities

 

1,281,002

 

 

1,067,359

 

 

1,093,358

 

 

812,995

 

Loans Receivable:
Commercial Real Estate

 

1,193,612

 

 

1,137,493

 

 

1,095,811

 

 

1,007,655

 

Commercial and Industrial

 

364,019

 

 

327,519

 

 

333,021

 

 

370,786

 

SBA Payroll Protection Program

 

386,388

 

 

642,107

 

 

551,190

 

 

675,666

 

Residential Real Estate

 

105,711

 

 

80,686

 

 

76,483

 

 

71,112

 

Installment and Other

 

4,261

 

 

4,212

 

 

4,405

 

 

6,039

 

Total Loans Receivable

 

2,053,991

 

 

2,192,017

 

 

2,060,910

 

 

2,131,258

 

Allowance for Loan Losses

 

(23,341

)

 

(22,946

)

 

(22,931

)

 

(22,399

)

Loans Receivable, Net

 

2,030,650

 

 

2,169,071

 

 

2,037,979

 

 

2,108,859

 

Furniture, Equipment and Leasehold Improvements, Net

 

7,074

 

 

7,472

 

 

7,857

 

 

8,520

 

Bank/Corporate Owned Life Insurance

 

28,325

 

 

28,070

 

 

27,738

 

 

26,651

 

Other Assets

 

41,440

 

 

44,247

 

 

41,277

 

 

37,396

 

Total Assets

$

3,732,329

 

$

3,705,210

 

$

3,454,262

 

$

3,295,263

 

 
Liabilities:
Non-Interest Bearing Demand Deposits

$

1,830,832

 

$

1,855,756

 

$

1,686,091

 

$

1,684,662

 

Interest Bearing Transaction Accounts

 

257,726

 

 

260,610

 

 

258,950

 

 

204,133

 

Money Market and Savings Deposits

 

1,311,603

 

 

1,270,228

 

 

1,191,591

 

 

1,100,191

 

Certificates of Deposit

 

34,543

 

 

34,267

 

 

35,778

 

 

35,713

 

Total Deposits

 

3,434,704

 

 

3,420,861

 

 

3,172,410

 

 

3,024,699

 

Federal Home Loan Bank Advances / Other Borrowings

 

 

 

 

 

 

 

 

Other Liabilities

 

35,031

 

 

36,265

 

 

34,014

 

 

43,206

 

Total Liabilities

$

3,469,735

 

$

3,457,126

 

$

3,206,424

 

$

3,067,905

 

 
Shareholders’ Equity:
Common Stock

$

200,904

 

$

166,956

 

$

166,263

 

$

165,032

 

Retained Earnings

 

60,337

 

 

84,473

 

 

75,557

 

 

58,359

 

Accumulated Other Comprehensive Income / (Loss)

 

1,353

 

 

(3,345

)

 

6,018

 

 

3,967

 

Total Shareholders’ Equity

$

262,594

 

$

248,084

 

$

247,838

 

$

227,358

 

Total Liabilities and Shareholders’ Equity

$

3,732,329

 

$

3,705,210

 

$

3,454,262

 

$

3,295,263

 

 
Standby Letters of Credit

$

33,184

 

$

32,115

 

$

33,469

 

$

37,259

 

 
Per Share Information:
Common Shares Outstanding

 

8,799,072

 

 

8,775,324

 

 

8,736,605

 

 

8,694,516

 

Book Value Per Share

$

29.84

 

$

28.27

 

$

28.37

 

$

26.15

 

Tangible Book Value Per Share

$

29.84

 

$

28.27

 

$

28.37

 

$

26.15

 

*

All per share amounts and number of shares outstanding have the 10% stock dividend retroactively applied

American Business Bank
Figures in $000, except share and per share amounts
 
INCOME STATEMENTS (unaudited)
 
For the three months ended:

June

 

March

 

June

2021

 

2021

 

2020

Interest Income:
Interest and Fees on Loans

$

22,861

$

20,774

 

$

19,169

 

Interest on Investment Securities

 

4,626

 

4,122

 

 

3,084

 

Interest on Interest Earning Deposits in Other Financial Institutions

 

99

 

66

 

 

93

 

Total Interest Income

 

27,586

 

24,962

 

 

22,346

 

 
Interest Expense:
Interest on Interest Bearing Transaction Accounts

 

40

 

41

 

 

37

 

Interest on Money Market and Savings Deposits

 

426

 

414

 

 

538

 

Interest on Certificates of Deposits

 

12

 

14

 

 

28

 

Interest on Federal Home Loan Bank Advances and Other Borrowings

 

 

 

 

 

Total Interest Expense

 

478

 

469

 

 

603

 

 
Net Interest Income

 

27,108

 

24,493

 

 

21,743

 

Provision for Loan Losses

 

 

 

 

680

 

Net Interest Income after Provision for Loan Losses

 

27,108

 

24,493

 

 

21,063

 

 
Non-Interest Income:
Deposit Fees

 

763

 

745

 

 

640

 

International Fees

 

260

 

263

 

 

244

 

Gain (Loss) on Sale of Investment Securities, Net

 

 

(15

)

 

(184

)

Gain on Sale of SBA Loans, Net

 

 

 

 

 

Bank/Corporate Owned Life Insurance Income (Expense)

 

255

 

332

 

 

953

 

Other

 

192

 

202

 

 

143

 

Total Non-Interest Income

 

1,470

 

1,527

 

 

1,796

 

 
Non-Interest Expense:
Salaries and Employee Benefits

 

10,231

 

9,663

 

 

9,384

 

Occupancy and Equipment

 

1,151

 

1,146

 

 

953

 

Professional Services

 

1,560

 

1,703

 

 

1,627

 

Promotion Expenses

 

297

 

222

 

 

267

 

Other

 

3,226

 

1,200

 

 

1,693

 

Total Non-Interest Expense

 

16,465

 

13,934

 

 

13,924

 

 
Earnings before income taxes

 

12,113

 

12,086

 

 

8,935

 

Income Tax Expense

 

3,054

 

3,170

 

 

2,200

 

 
NET INCOME

$

9,059

$

8,916

 

$

6,735

 

Add back:
After-Tax Gain (Loss) on Sale of Investment Securities, Net

$

$

11

 

$

139

 

Core Net Income

$

9,059

$

8,927

 

$

6,874

 

 
Per Share Information:
Earnings Per Share – Basic

$

1.01

$

1.00

 

$

0.76

 

 
Earnings Per Share – Diluted

$

1.00

$

0.99

 

$

0.76

 

Core Earnings Per Share – Diluted

$

1.00

$

0.99

 

$

0.77

 

 
Weighted Average Shares – Basic

 

8,961,797

 

8,921,941

 

 

8,850,734

 

 
Weighted Average Shares – Diluted

 

9,095,569

 

9,033,128

 

 

8,907,089

 

*

All per share amounts and number of shares outstanding have the 10% stock dividend retroactively applied

American Business Bank
Figures in $000, except share and per share amounts
 
INCOME STATEMENTS (unaudited)
 

For the six months ended:

June

 

June

2021

 

2020

Interest Income:
Interest and Fees on Loans

$

43,635

 

$

36,464

 

Interest on Investment Securities

 

8,748

 

 

6,997

 

Interest on Interest Earning Deposits in Other Financial Institutions

 

165

 

 

147

 

Total Interest Income

 

52,548

 

 

43,608

 

 
Interest Expense:
Interest on Interest Bearing Transaction Accounts

 

81

 

 

141

 

Interest on Money Market and Savings Deposits

 

840

 

 

1,505

 

Interest on Certificates of Deposits

 

26

 

 

69

 

Interest on Federal Home Loan Bank Advances and Other Borrowings

 

 

 

131

 

Total Interest Expense

 

947

 

 

1,846

 

 
Net Interest Income

 

51,601

 

 

41,762

 

Provision for Loan Losses

 

 

 

2,114

 

Net Interest Income after Provision for Loan Losses

 

51,601

 

 

39,648

 

 
Non-Interest Income:
Deposit Fees

 

1,507

 

 

1,255

 

International Fees

 

523

 

 

527

 

Gain (Loss) on Sale of Investment Securities, Net

 

(15

)

 

(137

)

Gain on Sale of SBA Loans, Net

 

 

 

19

 

Bank/Corporate Owned Life Insurance Income (Expense)

 

587

 

 

203

 

Other

 

394

 

 

341

 

Total Non-Interest Income

 

2,996

 

 

2,208

 

 
Non-Interest Expense:
Salaries and Employee Benefits

 

19,893

 

 

17,603

 

Occupancy and Equipment

 

2,297

 

 

1,873

 

Professional Services

 

3,263

 

 

3,108

 

Promotion Expenses

 

519

 

 

633

 

Other

 

4,426

 

 

2,755

 

Total Non-Interest Expense

 

30,398

 

 

25,972

 

 
Earnings before income taxes

 

24,199

 

 

15,884

 

Income Tax Expense

 

6,224

 

 

4,310

 

 
NET INCOME

$

17,975

 

$

11,574

 

Add back:
After-Tax Gain (Loss) on Sale of Investment Securities, Net

$

11

 

$

100

 

Core Net Income

$

17,986

 

$

11,674

 

 
Per Share Information:
Earnings Per Share – Basic

$

2.01

 

$

1.31

 

 
Earnings Per Share – Diluted

$

1.98

 

$

1.30

 

Core Earnings Per Share – Diluted

$

1.98

 

$

1.31

 

 
Weighted Average Shares – Basic

 

8,941,869

 

 

8,845,307

 

 
Weighted Average Shares – Diluted

 

9,064,349

 

 

8,920,840

 

*

All per share amounts and number of shares outstanding have the 10% stock dividend retroactively applied

American Business Bank
Figures in $000
 
QUARTERLY AVERAGE BALANCE SHEETS AND YIELD ANALYSIS (unaudited)
 
For the three months ended:
June 2021 March 2021
Average Interest Average Average Interest Average
Balance Inc/Exp Yield/Rate Balance Inc/Exp Yield/Rate
Interest Earning Assets:
Interest Earning Deposits in Other Financial Institutions

$

329,324

$

99

0.12%

$

216,373

$

66

0.12%

 
Investment Securities:
US Agencies

 

216,143

 

383

0.71%

 

225,144

 

408

0.72%

Mortgage Backed Securities

 

466,148

 

1,565

1.34%

 

398,884

 

1,229

1.23%

State and Municipals

 

435,608

 

2,394

2.20%

 

414,773

 

2,267

2.19%

US Treasuries

 

 

0.00%

 

 

0.00%

Corporate Bonds

 

10,085

 

82

3.25%

 

10,273

 

82

3.20%

Securities Available-for-Sale and Held-to-Maturity

 

1,127,984

 

4,424

1.57%

 

1,049,074

 

3,986

1.52%

Federal Home Loan Bank Stock

 

11,628

 

202

6.95%

 

10,864

 

136

5.01%

Total Investment Securities

 

1,139,612

 

4,626

1.62%

 

1,059,938

 

4,122

1.56%

Loans Receivable:
Commercial Real Estate

 

1,163,231

 

11,944

4.12%

 

1,105,890

 

11,463

4.20%

Commercial and Industrial

 

340,067

 

3,921

4.62%

 

330,778

 

3,462

4.24%

SBA Payroll Protection Program

 

555,338

 

6,069

4.38%

 

609,638

 

5,040

3.35%

Residential Real Estate

 

93,126

 

889

3.83%

 

78,034

 

758

3.94%

Installment and Other

 

5,613

 

38

2.75%

 

4,957

 

51

4.15%

Total Loans Receivable

 

2,157,375

 

22,861

4.25%

 

2,129,297

 

20,774

3.96%

Total Interest Earning Assets

$

3,626,311

$

27,586

3.01%

$

3,405,608

$

24,962

2.93%

 
Liabilities:
Non-Interest Bearing Demand Deposits

 

1,871,930

 

0.00%

 

1,730,626

 

0.00%

Interest Bearing Transaction Accounts

 

267,490

 

40

0.06%

 

255,416

 

41

0.07%

Money Market and Savings Deposits

 

1,278,436

 

426

0.13%

 

1,223,414

 

414

0.14%

Certificates of Deposit

 

34,446

 

12

0.14%

 

34,865

 

14

0.16%

Total Deposits

 

3,452,302

 

478

0.06%

 

3,244,321

 

469

0.06%

Federal Home Loan Bank Advances / Other Borrowings

 

7

 

0.37%

 

 

0.00%

Total Interest Bearing Deposits and Borrowings

 

1,580,379

 

478

0.12%

 

1,513,695

 

469

0.13%

Total Deposits and Borrowings

$

3,452,309

$

478

0.06%

$

3,244,321

$

469

0.06%

 
Net Interest Income

$

27,108

$

24,493

Net Interest Rate Spread

2.95%

2.87%

Net Interest Margin

3.00%

2.92%

Net Interest Margin, excluding SBA PPP

2.75%

2.82%

American Business Bank
Figures in $000
 
QUARTERLY AVERAGE BALANCE SHEETS AND YIELD ANALYSIS (unaudited)
 
For the three months ended:
June 2021 June 2020
Average Interest Average Average Interest Average
Balance Inc/Exp Yield/Rate Balance Inc/Exp Yield/Rate
Interest Earning Assets:
Interest Earning Deposits in Other Financial Institutions

$

329,324

$

99

0.12%

$

264,722

$

93

0.14%

 
Investment Securities:
US Agencies

 

216,143

 

383

0.71%

 

260,033

 

270

0.41%

Mortgage Backed Securities

 

466,148

 

1,565

1.34%

 

271,173

 

1,434

2.12%

State and Municipals

 

435,608

 

2,394

2.20%

 

174,950

 

1,196

2.73%

US Treasuries

 

 

0.00%

 

10,018

 

37

1.48%

Corporate Bonds

 

10,085

 

82

3.25%

 

19,908

 

147

2.95%

Securities Available-for-Sale and Held-to-Maturity

 

1,127,984

 

4,424

1.57%

 

736,082

 

3,084

1.68%

Federal Home Loan Bank Stock

 

11,628

 

202

6.95%

 

10,753

 

0.00%

Total Investment Securities

 

1,139,612

 

4,626

1.62%

 

746,835

 

3,084

1.65%

Loans Receivable:
Commercial Real Estate

 

1,163,231

 

11,944

4.12%

 

1,003,318

 

11,031

4.42%

Commercial and Industrial

 

340,067

 

3,921

4.62%

 

402,179

 

4,380

4.38%

SBA Payroll Protection Program

 

555,338

 

6,069

4.38%

 

539,535

 

2,994

2.23%

Residential Real Estate

 

93,126

 

889

3.83%

 

70,984

 

705

4.00%

Installment and Other

 

5,613

 

38

2.75%

 

5,037

 

59

4.75%

Total Loans Receivable

 

2,157,375

 

22,861

4.25%

 

2,021,053

 

19,169

3.81%

Total Interest Earning Assets

$

3,626,311

$

27,586

3.01%

$

3,032,610

$

22,346

2.91%

 
Liabilities:
Non-Interest Bearing Demand Deposits

 

1,871,930

 

0.00%

 

1,624,250

 

0.00%

Interest Bearing Transaction Accounts

 

267,490

 

40

0.06%

 

201,439

 

37

0.07%

Money Market and Savings Deposits

 

1,278,436

 

426

0.13%

 

1,027,292

 

538

0.21%

Certificates of Deposit

 

34,446

 

12

0.14%

 

35,614

 

28

0.31%

Total Deposits

 

3,452,302

 

478

0.06%

 

2,888,595

 

603

0.08%

Federal Home Loan Bank Advances / Other Borrowings

 

7

 

0.37%

 

 

0.00%

Total Interest Bearing Deposits and Borrowings

 

1,580,379

 

478

0.12%

 

1,264,345

 

603

0.19%

Total Deposits and Borrowings

$

3,452,309

$

478

0.06%

$

2,888,595

$

603

0.08%

 
Net Interest Income

$

27,108

$

21,743

Net Interest Rate Spread

2.95%

2.83%

Net Interest Margin

3.00%

2.88%

Net Interest Margin, excluding SBA PPP

2.75%

3.02%

American Business Bank
Figures in $000
 
YEAR-TO-DATE AVERAGE BALANCE SHEETS AND YIELD ANALYSIS (unaudited)
 
For the six months ended:
June 2021 June 2020
Average Interest Average Average Interest Average
Balance Inc/Exp Yield/Rate Balance Inc/Exp Yield/Rate
Interest Earning Assets:
Interest Earning Deposits with Other Financial Institutions

$

273,160

$

165

0.12%

$

146,139

$

147

0.20%

 
Investment Securities:
US Agencies

 

220,619

 

790

0.72%

 

268,943

 

946

0.70%

Mortgage Backed Securities

 

432,702

 

2,794

1.29%

 

279,234

 

3,177

2.28%

State and Municipals

 

425,248

 

4,662

2.19%

 

169,050

 

2,317

2.74%

US Treasuries

 

 

0.00%

 

10,022

 

74

1.48%

Corporate Bonds

 

10,179

 

164

3.23%

 

19,928

 

297

2.98%

Securities Available-for-Sale and Held-to-Maturity

 

1,088,748

 

8,410

1.54%

 

747,177

 

6,811

1.82%

Federal Home Loan Bank Stock

 

11,248

 

338

6.01%

 

10,554

 

186

3.52%

Total Investment Securities

 

1,099,996

 

8,748

1.59%

 

757,731

 

6,997

1.85%

Loans Receivable:
Commercial Real Estate

 

1,134,719

 

23,405

4.16%

 

1,004,366

 

22,374

4.48%

Commercial and Industrial

 

335,448

 

7,383

4.44%

 

419,181

 

9,404

4.51%

SBA Payroll Protection Program

 

582,338

 

11,110

3.85%

 

269,767

 

2,994

2.23%

Residential Real Estate

 

85,622

 

1,648

3.88%

 

73,643

 

1,592

4.35%

Installment and Other

 

5,287

 

89

3.40%

 

5,343

 

100

3.76%

Total Loans Receivable

 

2,143,414

 

43,635

4.11%

 

1,772,300

 

36,464

4.14%

Total Interest Earning Assets

$

3,516,570

$

52,548

2.97%

$

2,676,170

$

43,608

3.22%

 
Liabilities:
Non-Interest Bearing Demand Deposits

 

1,801,668

 

0.00%

 

1,364,422

 

0.00%

Interest Bearing Transaction Accounts

 

261,487

 

81

0.06%

 

201,845

 

141

0.14%

Money Market and Savings Deposits

 

1,251,077

 

840

0.14%

 

917,213

 

1,505

0.33%

Certificates of Deposit

 

34,654

 

26

0.15%

 

36,020

 

69

0.39%

Total Deposits

 

3,348,886

 

947

0.06%

 

2,519,500

 

1,715

0.14%

Federal Home Loan Bank Advances / Other Borrowings

 

4

 

0.37%

 

15,857

 

131

1.66%

Total Interest Bearing Deposits and Borrowings

 

1,547,222

 

947

0.12%

 

1,170,935

 

1,846

0.32%

Total Deposits and Borrowings

$

3,348,890

$

947

0.06%

$

2,535,357

$

1,846

0.15%

 
Net Interest Income

$

51,601

$

41,762

Net Interest Rate Spread

2.91%

3.07%

Net Interest Margin

2.96%

3.14%

Net Interest Margin, excluding SBA PPP

2.78%

3.24%

American Business Bank
Figures in $000
 
SUPPLEMENTAL DATA (unaudited)
 

June

 

March

 

December

 

June

2021

 

2021

 

2020

 

2020

Performance Ratios:
Quarterly:
Return on Average Assets (ROAA)

 

0.97%

 

1.01%

 

1.08%

 

0.86%

Core Return on Average Assets (ROAA)

 

0.97%

 

1.01%

 

1.08%

 

0.87%

 
Return on Average Equity (ROAE)

 

14.21%

 

14.32%

 

15.57%

 

12.14%

Core Return on Average Equity (ROAE)

 

14.21%

 

14.34%

 

15.57%

 

12.39%

 
Efficiency Ratio

 

57.61%

 

53.52%

 

53.70%

 

58.70%

 
Year-to-Date
Return on Average Assets (ROAA)

 

0.99%

 

1.01%

 

0.93%

 

0.83%

Core Return on Average Assets (ROAA)

 

0.99%

 

1.01%

 

0.93%

 

0.84%

 
Return on Average Equity (ROAE)

 

14.26%

 

14.32%

 

12.70%

 

10.68%

Core Return on Average Equity (ROAE)

 

14.27%

 

14.34%

 

12.76%

 

10.77%

 
Efficiency Ratio

 

55.66%

 

53.52%

 

56.40%

 

58.88%

Core Efficiency Ratio

 

55.66%

 

53.52%

 

56.40%

 

58.88%

 
Capital Adequacy:
Total Risk Based Capital Ratio

 

14.26%

 

14.85%

 

14.65%

 

14.64%

Common Equity Tier 1 Capital Ratio

 

13.01%

 

13.60%

 

13.40%

 

13.38%

Tier 1 Risk Based Capital Ratio

 

13.01%

 

13.60%

 

13.40%

 

13.38%

Tier 1 Leverage Ratio

 

6.98%

 

7.13%

 

6.98%

 

7.10%

Tangible Common Equity / Tangible Assets

 

7.04%

 

6.70%

 

7.17%

 

6.90%

 
Asset Quality Overview
Non-Performing Loans

$

54

$

2,172

$

2,405

$

2,601

Loans 90+ Days Past Due and Still Accruing

 

 

 

 

Total Non-Performing Loans

 

54

 

2,172

 

2,405

 

2,601

 
Restructured Loans

 

214

 

216

 

218

 

223

 
Other Real Estate Owned

 

 

 

 

 
ALLL / Loans Receivable

 

1.14%

 

1.05%

 

1.11%

 

1.05%

Non-Performing Loans / Total Loans Receivable *

 

0.01%

 

0.11%

 

0.13%

 

0.13%

Non-Performing Loans / Total Loans Receivable *, excluding PPP **

 

0.02%

 

0.15%

 

0.17%

 

0.19%

Non-Performing Assets / Total Assets *

 

0.01%

 

0.06%

 

0.08%

 

0.09%

Non-Performing Assets / Total Assets *, excluding PPP **

 

0.01%

 

0.08%

 

0.09%

 

0.11%

Net Charge-Offs (Recoveries) quarterly

$

(395)

$

(16)

$

(21)

$

168

Net Charge-Offs (Recoveries) year-to-date

$

(411)

$

(16)

$

457

$

538

Net Charge-Offs (Recoveries) year-to-date / Average Loans Receivable

 

-0.02%

 

0.00%

 

0.02%

 

0.03%

*

Includes non-accrual loans, accruing loans past due 90+ days and Troubled Debt Restructurings (TDRs).

**

SBA Paycheck Protection Program (PPP)

 

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