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American Riviera Bank Reports Strong Growth and Expansion

American Riviera Bank (OTC Markets: ARBV) announced today unaudited net income of $3,274,000 ($0.65 per share) for the six months ended June 30, 2019. This represents a 16% increase in net income from the $2,827,000 ($0.64 per share) for the same reporting period in the prior year. The Bank reported an annualized return on average assets of 1.07% and return on average equity of 10.06%. The Bank reported unaudited net income of $1,506,000 ($0.30 per share) for the second quarter ended June 30, 2019 compared to $1,475,000 ($0.33 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 first quarter ended March 31, 2019.

The Bank continues to experience significant growth, reporting $662 million in total assets as of June 30, 2019. Total deposits, excluding wholesale deposits, increased 16% from June 30, 2018. The Bank had $5 million of wholesale deposits at June 30, 2019, down from the $49 million at June 30, 2018. Over the past twelve months the Bank has replaced these wholesale deposits with local customer deposits. Non-interest bearing demand deposit accounts increased $18 million, or 11% from the same reporting period last year, reaching $187 million at June 30, 2019.

The Bank reported strong loan growth, with gross loans increasing $64 million, or 13% from June 30, 2018, reaching $542 million at June 30, 2019, with no other real estate owned and no loans 30 or more days past due. The Bank’s net interest income increased by approximately $1.5 million, or 13% for the six months ended June 30, 2019, compared to the same reporting period in the prior year. The Bank reported an annualized net interest margin of 4.34% for the six months ended June 30, 2019, reflecting only modest compression from the 4.52% reported for the same reporting period last year.

Jeff DeVine, President and Chief Executive Officer stated, We continue to invest in our expansion and are pleased to announce the opening of our full service branch in the City of San Luis Obispo which will allow us to better serve the needs of businesses and consumers in San Luis Obispo County. We look forward to welcoming new clients affected by mega-mergers who will benefit from our high level of service built on relationships with local decision makers.”

As of June 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 $13.41 at June 30, 2019, a 14% increase from $11.80 at June 30, 2018.

Company Profile

American Riviera Bank is a full-service community bank focused on serving the lending and deposit needs of businesses and consumers on the Central Coast of California. The state-chartered bank opened for business on July 18, 2006, with the support of local shareholders. Full-service branches are located in Santa Barbara, Montecito, Goleta, San Luis Obispo and Paso Robles. The bank provides commercial, residential mortgage, construction and Small Business Administration lending services as well as convenient online and mobile technology. For nine consecutive years the Bank has been recognized for strong financial performance by the Findley Reports, and received the highest “Super Premier” rating from Findley for 2018 and 2017. As of March 31, 2019, the Bank was rated five stars by BauerFinancial.

Statements concerning future performance, developments or events concerning expectations for growth and market forecasts, and any other guidance on future periods, constitute forward looking statements that are subject to a number of risks and uncertainties. Actual results may differ materially from stated expectations. Specific factors include, but are not limited to, effects of interest rate changes, ability to control costs and expenses, impact of consolidation in the banking industry, financial policies of the US government, and general economic conditions.

Balance Sheets (unaudited)
(dollars in thousands)

Jun 30,

Jun 30,

One Year

2019

2018

Change

Assets
Cash & Due From Banks

$

47,640

$

42,796

11

%

Fed Funds Sold

-

-

-

Securities

42,961

48,274

-11

%

 
Loans

541,869

477,837

13

%

Allowance For Loan Losses

(5,883

)

(4,895

)

20

%

Net Loans

535,986

472,942

13

%

 
Fixed Assets

6,528

5,294

23

%

Goodwill and Other Intangibles

5,427

5,606

-3

%

Other Assets

23,054

16,320

41

%

Total Assets

661,596

591,232

12

%

 
 
Liabilities & Shareholders' Equity
Demand Deposits

186,845

168,609

11

%

NOW Accounts

73,782

86,543

-15

%

Other Interest Bearing Deposits

304,223

276,460

10

%

Total Deposits

564,850

531,612

6

%

 
Borrowed Funds

15,000

-

N/M

Other Liabilities

8,806

2,134

313

%

Total Liabilities

588,656

533,746

10

%

 
Common Stock

54,739

46,212

18

%

Retained Earnings

18,105

11,768

54

%

Other Capital

96

(494

)

N/M

Total Shareholders' Equity

72,940

57,486

27

%

 
Total Liabilities & Shareholders' Equity

$

661,596

$

591,232

12

%

 
Book Value Per Share

$

14.49

$

13.06

11

%

Tangible Book Value Per Share

$

13.41

$

11.80

14

%

Statements of Income (unaudited)
(dollars in thousands)

Quarter Ended

6 Months Ended

Jun 30,

Jun 30,

Jun 30,

Jun 30,

2019

2018

Change

2019

2018

Change

Interest Income
Interest and Fees on Loans

$

6,992

$

5,769

21

%

$

13,672

$

11,037

24

%

Net Fair Value Amortization Income

86

176

-51

%

308

306

1

%

Interest on Securities

230

253

-9

%

514

437

18

%

Interest on Fed Funds

0

1

-100

%

1

11

-91

%

Interest on Due From Banks

205

122

68

%

403

269

50

%

Total Interest Income

7,513

6,321

19

%

14,898

12,060

24

%

 
Interest Expense
Interest Expense on Deposits

998

326

206

%

1,822

592

208

%

Interest Expense on Borrowings

60

98

-39

%

202

120

68

%

Total Interest Expense

1,058

424

150

%

2,024

712

184

%

 
Net Interest Income

6,455

5,897

9

%

12,874

11,348

13

%

Provision for Loan Losses

220

363

-39

%

395

631

-37

%

Net Interest Income After Provision

6,235

5,534

13

%

12,479

10,717

16

%

 
Non-Interest Income
Service Charges, Commissions and Fees

580

409

42

%

1,007

845

19

%

Other Non-Interest Income

113

84

35

%

279

198

41

%

Total Non-Interest Income

693

493

41

%

1,286

1,043

23

%

 
Non-Interest Expense
Salaries and Employee Benefits

2,881

2,278

26

%

5,573

4,631

20

%

Occupancy and Equipment

546

429

27

%

1,040

821

27

%

Other Non-Interest Expense

1,366

1,227

11

%

2,679

2,376

13

%

Total Non-Interest Expense

4,793

3,934

22

%

9,292

7,828

19

%

 
Net Income Before Provision for Taxes

2,135

2,093

2

%

4,473

3,932

14

%

Provision for Taxes

629

618

2

%

1,199

1,105

9

%

Net Income

$

1,506

$

1,475

2

%

$

3,274

$

2,827

16

%

 
Shares (end of period)

5,028,906

4,440,082

13

%

5,028,906

4,440,082

13

%

Earnings Per Share - Basic

$

0.30

$

0.33

-9

%

$

0.65

$

0.64

2

%

 
Return on Average Assets (annualized)

0.95

%

1.07

%

1.07

%

1.08

%

Return on Average Equity (annualized)

8.46

%

10.47

%

10.06

%

10.37

%

Net Interest Margin (annualized)

4.27

%

4.54

%

4.34

%

4.52

%

Contacts:

American Riviera Bank
Michelle Martinich, 805-965-5942
www.americanrivierabank.com

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