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American Riviera Bank Reports Loan & Deposit Growth

Santa Barbara, California (October 25, 2019) – American Riviera Bank (OTC Markets: ARBV) announced today unaudited net income of $4,821,000 ($0.96 per share) for the nine months ended September 30, 2019. This represents a 10% increase in net income from the $4,398,000 ($0.99 per share) for the same reporting period in the prior year. The Bank reported an annualized return on average assets of 1.00% and return on average equity of 9.36%. The Bank reported unaudited net income of $1,547,000 ($0.31 per share) for the third quarter ended September 30, 2019 compared to $1,571,000 ($0.35 per share) for the same quarter last year. Share count has increased primarily due to the $8,500,000 common stock capital raise closed in the quarter ended March 31, 2019.

The Bank continues to experience significant growth, reporting $697 million in total assets as of September 30, 2019. Total deposits increased 20% from September 30, 2018 reaching $603 million at September 30, 2019. Non-interest bearing demand deposit accounts increased $41 million, or 25% from the same reporting period last year, reaching $208 million at September 30, 2019.

The Bank reported strong loan growth, with gross loans increasing $59 million, or 12% from September 30, 2018, reaching $548 million at September 30, 2019, with no other real estate owned and no loans 30 days or more past due. The Bank’s net interest income increased by approximately $2.1 million, or 12% for the nine months ended September 30, 2019, compared to the same reporting period in the prior year. The Bank reported an annualized net interest margin of 4.30% for the nine months ended September 30, 2019, reflecting only modest compression from the 4.47% reported for the same reporting period last year.

Jeff DeVine, President and Chief Executive Officer stated, We continue to invest in the expansion of the Bank and consistently report strong earnings. This is a direct result of our loan and deposit growth, expanded regional presence and the strength of our relationships throughout the Santa Barbara and San Luis Obispo Counties.”

As of September 30, 2019, American Riviera Bank has a strong capital position with a Tier 1 Capital Ratio of 12%; well above the regulatory guideline of 8% for well capitalized institutions. The tangible book value per share of American Riviera Bank common stock is $13.74 at September 30, 2019, a 15% increase from $11.96 at September 30, 2018.

Balance Sheets (unaudited)            
(dollars in thousands)            
      Sep 30,   Sep 30,   One Year
      2019   2018   Change
Assets            
  Cash & Due From Banks    $                 79,101    $                  31,392   152%
  Fed Funds Sold                                 -                                    -     -
  Securities                        41,797                         46,549   -10%
               
  Loans                     547,956                      489,401   12%
  Allowance For Loan Losses                        (6,145)                         (5,242)   17%
  Net Loans                     541,811                      484,159   12%
               
  Premise & Equipment                          6,812                           5,308   28%
  Goodwill and Other Intangibles                          5,382                           5,561   -3%
  Other Assets (a)                        22,364                         16,034   39%
Total Assets    $               697,267    $                589,003   18%
               
               
Liabilities & Shareholders' Equity            
  Demand Deposits    $               207,643    $                166,145   25%
  NOW Accounts                        79,509                         86,543   -8%
  Other Interest Bearing Deposits                     316,124                      250,958   26%
  Total Deposits                     603,276                      503,646   20%
               
  Borrowed Funds                        10,000                         24,000   -58%
  Other Liabilities (a)                          9,452                           2,295   312%
  Total Liabilities                     622,728                      529,941   18%
               
  Common Stock (b)                        54,889                         46,400   18%
  Retained Earnings                        19,653                         13,339   47%
  Other Capital                                (3)                            (677)   -100%
  Total Shareholders' Equity                        74,539                         59,062   26%
               
Total Liabilities & Shareholders' Equity    $               697,267    $                589,003   18%
               
               
Notes:            
  (a) Other assets and other liabilities primarily increased due to the adoption of ASU2016-02, "Leases (Topic 842)" as of January 1, 2019.  As of September 30, 2019 the right of use asset totals $5.6 million and the operating lease liability is $6 million.
  (b) Common stock increased in the first quarter 2019 due to $8.5 million common stock capital raise.    

 

Balance Sheets (unaudited)                    
(dollars in thousands)                    
      September 30,   June 30,   March 31,   December 31,   September 30,
      2019   2019   2019   2018   2018
Assets                    
  Cash & Due From Banks    $          79,101    $          47,640    $          48,835    $          41,271    $            31,392
  Fed Funds Sold                         -                           -                           -                           -                             -  
  Securities                41,797                42,961                44,123                46,010                  46,549
                       
  Loans              547,956              541,869              520,857              508,397                489,401
  Allowance For Loan Losses                (6,145)                (5,883)                (5,661)                (5,542)                  (5,242)
  Net Loans              541,811              535,986              515,196              502,855                484,159
                       
  Premise & Equipment                  6,812                  6,528                  5,588                  5,299                    5,308
  Goodwill and Other Intangibles                  5,382                  5,427                  5,472                  5,516                    5,561
  Other Assets (a)                22,364                23,054                19,524                15,501                  16,034
Total Assets    $       697,267    $       661,596    $       638,738    $       616,452    $         589,003
                       
                       
Liabilities & Shareholders' Equity                    
  Demand Deposits    $       207,643    $       186,845    $       187,048    $       169,549    $         166,145
  NOW Accounts                79,509                73,782                76,370                73,652                  86,543
  Other Interest Bearing Deposits              316,124              304,223              282,874              270,106                250,958
  Total Deposits              603,276              564,850              546,292              513,307                503,646
                       
  Borrowed Funds                10,000                15,000                15,000                40,000                  24,000
  Other Liabilities (a)                  9,452                  8,806                  6,562                  2,258                    2,295
  Total Liabilities              622,728              588,656              567,854              555,565                529,941
                       
  Common Stock (b)                54,889                54,739                54,513                46,477                  46,400
  Retained Earnings                19,653                18,105                16,600                14,831                  13,339
  Other Capital                        (3)                        96                    (229)                    (421)                      (677)
  Total Shareholders' Equity                74,539                72,940                70,884                60,887                  59,062
                       
Total Liabilities & Shareholders' Equity    $       697,267    $       661,596    $       638,738    $       616,452    $         589,003
                       
Notes:                    
  (a) Other assets and other liabilities primarily increased due to the adoption of ASU2016-02,  "Leases (Topic 842)" as of January 1, 2019. As of September 30, 2019 the right of use asset totals $5.6 million and the operating lease liability is $6 million. The San Luis Obispo branch was added for the quarter ending June 30, 2019.    
  (b) Common stock increased in the first quarter 2019 due to $8.5 million common stock capital raise.  
                        

 

Statements of Income (unaudited)                        
(dollars in thousands, except per share data)                        
      Quarter Ended   Nine Months Ended
      Sep 30,   Sep 30,       Sep 30,   Sep 30,    
      2019   2018   Change   2019   2018   Change
Interest Income                        
  Interest and Fees on Loans    $        7,224    $        6,256   15%    $        20,896    $        17,294   21%
  Net Fair Value Amortization Income                    71                  118   -40%                    379                    424   -11%
  Interest on Securities                  264                  266   -1%                    778                    702   11%
  Interest on Fed Funds                       0                      1   -100%                         1                      12   -92%
  Interest on Due From Banks                  291                  167   74%                    694                    436   59%
  Total Interest Income              7,850              6,808   15%              22,748              18,868   21%
                           
Interest Expense                        
  Interest Expense on Deposits              1,065                  622   71%                2,887                1,214   138%
  Interest Expense on Borrowings                    32                      6   433%                    234                    126   86%
  Total Interest Expense              1,097                  628   75%                3,121                1,340   133%
                           
Net Interest Income              6,753              6,180   9%              19,627              17,528   12%
  Provision for Loan Losses                  205                  294   -30%                    600                    925   -35%
Net Interest Income After Provision              6,548              5,886   11%              19,027              16,603   15%
                           
Non-Interest Income                        
  Service Charges, Commissions and Fees                  523                  397   32%                1,530                1,242   23%
  Other Non-Interest Income                  216                    60   260%                    495                    258   92%
  Total Non-Interest Income                  739                  457   62%                2,025                1,500   35%
                           
Non-Interest Expense                        
  Salaries and Employee Benefits              3,137              2,429   29%                8,710                7,061   23%
  Occupancy and Equipment                  653                  483   35%                1,693                1,304   30%
  Other Non-Interest Expense              1,303              1,210   8%                3,982                3,585   11%
  Total Non-Interest Expense              5,093              4,122   24%              14,385              11,950   20%
                           
Net Income Before Provision for Taxes              2,194              2,221   -1%                6,667                6,153   8%
Provision for Taxes                  647                  650   0%                1,846                1,755   5%
Net Income     $        1,547    $        1,571   -2%    $          4,821    $          4,398   10%
                           
  Shares (end of period)      5,031,788      4,459,269   13%        5,031,788        4,459,269   13%
  Earnings Per Share - Basic    $          0.31    $          0.35   -11%    $            0.96    $            0.99   -3%
  Return on Average Assets   0.89%   1.03%   -14%   1.00%   1.06%   -6%
  Return on Average Equity   8.09%   10.39%   -22%   9.36%   10.38%   -10%
  Net Interest Margin   4.23%   4.39%   -4%   4.30%   4.47%   -4%

 

Five Quarter Statements of Income (unaudited)                
(dollars in thousands)                    
      Three Months Ended
      September 30,   June 30,   March 31,   December 31,   September 30,
      2019   2019   2019   2018   2018
Interest Income                    
  Interest and Fees on Loans    $            7,224    $            6,992    $            6,680    $            6,533    $            6,256
  Net Fair Value Amortization Income                        71                        86                      222                      423                      118
  Interest on Securities                      264                      230                      284                      297                      266
  Interest on Fed Funds                          -                           -                             1                         -                             1
  Interest on Due From Banks                      291                      205                      198                      165                      167
  Total Interest Income                  7,850                  7,513                  7,385                  7,418                  6,808
                       
Interest Expense                    
  Interest Expense on Deposits                  1,065                      998                      825                      681                      622
  Interest Expense on Borrowings                        32                        60                      141                        73                           6
  Total Interest Expense                  1,097                  1,058                      966                      754                      628
                       
Net Interest Income                  6,753                  6,455                  6,418                  6,664                  6,180
  Provision for Loan Losses                      205                      220                      175                      369                      294
Net Interest Income After Provision                  6,548                  6,235                  6,244                  6,295                  5,886
                       
Non-Interest Income                    
  Service Charges, Commissions and Fees                      523                      580                      427                      289                      397
  Other Non-Interest Income (a)                      216                      113                      166                      (53)                        60
  Total Non-Interest Income                      739                      693                      593                      236                      457
                       
Non-Interest Expense                    
  Salaries and Employee Benefits                  3,137                  2,881                  2,692                  2,633                  2,429
  Occupancy and Equipment                      653                      546                      494                      503                      483
  Other Non-Interest Expense                  1,303                  1,366                  1,313                  1,212                  1,210
  Total Non-Interest Expense                  5,093                  4,793                  4,499                  4,348                  4,122
                       
Net Income Before Provision for Taxes                  2,194                  2,135                  2,338                  2,183                  2,221
Provision for Taxes                      647                      629                      570                      691                      650
Net Income     $            1,547    $            1,506    $            1,768    $            1,492    $            1,571
                       
  Shares (end of period)          5,031,788          5,028,906          5,020,829          4,461,068          4,459,269
  Earnings Per Share - Basic    $              0.31    $              0.30    $              0.35    $              0.33    $              0.35
                       
Notes:                    
  (a) The Bank conducted a Bank Owned Life Insurance carrier exchange that cost $170k in other non-interest income during the quarter ended December 31, 2018 .

 

Selected Financial Highlights (unaudited)                    
(dollars in thousands, except per share data)                    
      At or for the Three Months Ended
      September 30,   June 30,   March 31,   December 31,   September 30,
      2019   2019   2019   2018   2018
Income and performance ratios:                    
  Net Income    $            1,547    $            1,506    $            1,768    $            1,492    $            1,571
  Eamings per share - basic                     0.31                     0.30                     0.35                     0.33                     0.35
  Retum on average assets   0.89%   0.95%   1.19%   0.95%   1.03%
  Return on average equity    8.09%   8.46%   11.90%   9.60%   10.39%
  Net interest margin   4.23%   4.27%   4.42%   4.61%   4.39%
  Efficiency ratio   68.46%   66.90%   63.40%   63.45%   62.55%
                       
Asset quality:                    
  Allowance for loan and lease losses    $            6,145    $            5,883    $            5,661    $            5,542    $            5,242
  Nonperforming assets                      276                      281                      292                      349                      359
  Allowance for loan and lease losses / total loans and leases   1.12%   1.09%   1.09%   1.09%   1.06%
  Net charge-offs / average loans and leases (annualized)   0.00%   0.02%   0.04%   0.00%   0.00%
  Texas ratio   0.37%   0.38%   0.41%   0.57%   0.61%
                       
Other ratios:                    
  Tier 1 risk-based capital (a)   11.56%   11.56%   11.76%   10.30%   10.35%
  Total risk-based capital (a)   12.62%   12.61%   12.81%   11.36%   11.38%
  Common equity tier 1 risk-based capital (a)   11.56%   11.56%   11.76%   10.30%   10.35%
  Tier 1 leverage ratio (a)   10.32%   10.48%   10.55%   9.21%   9.13%
                       
Equity and share related:                    
  Common equity    $          74,539    $          72,940    $          70,884    $          60,887    $          59,062
  Book value per share                  14.81                  14.49                  14.16                  13.74                  13.40
  Tangible book value per share                  13.74                  13.41                  13.07                  12.51                  11.96
  Stock closing price per share                  17.85                  18.35                  18.25                  17.85                  19.20
  Number of shares issued and outstanding                  5,032                  5,029                  5,021                  4,461                  4,459
                       
                       
Notes:                    
  (a) Presented as projected for most recent quarter and actual for the remaining periods.