American Business Bank Reports Second Quarter Earnings of $11.4 Million

Rhea-AI Summary

American Business Bank (OTCQX: AMBZ) reported net income of $11.4 million ($1.24 per share) for Q2 2022, a 15% increase from Q1 2022. Core loans rose by $129 million (25% annualized), with net interest income increasing by 23% year-over-year, reaching $29.9 million. The non-performing assets to total assets ratio stood at a low 0.03%. Despite a decrease in PPP loan income, the bank remains well capitalized. The efficiency ratio improved to 45%, down from 50% in Q1, and the overall loan pipeline is robust with new relationship managers onboard.

Positive

• Net income increased by 15% to $11.4 million in Q2 2022.
• Core loans grew by $129 million, or 25% annualized.
• Net interest income rose to $29.9 million, a 23% increase year-over-year.
• Efficiency ratio improved to 45%, down from 50% in Q1 2022.

Negative

• PPP loan income decreased by 6% compared to the prior quarter.

Core loans increased by $129 million or 25% annualized in the quarter

Second Quarter 2022 Highlights

• Total core loans, excluding PPP loans, increased $129 million or 6% over prior quarter
• Net interest income increased 23%, excluding accelerated PPP fees, over prior year quarter
• Net income increased $2.4 million or 26% over prior year quarter
• Total PPP loans outstanding of $23 million with $588 thousand of net deferred processing fees
• Nonperforming assets to total assets of 0.03%
• Non-interest bearing demand deposits were 53% of total deposits
• Net interest income includes accelerated PPP fees of $1.5 million on loan forgiveness
• Cost of average deposits of 0.04%, a decline of 0.02% over prior year quarter
• Continued status as well capitalized, the highest regulatory standard

LOS ANGELES--(BUSINESS WIRE)-- AMERICAN BUSINESS BANK (OTCQX: AMBZ) today reported net income of $11.4 million or $1.24 per fully diluted share for the second quarter of 2022 compared to $9.9 million or $1.08 per fully diluted share for the first quarter of 2022, an increase of 15%. For the quarter ended June 30, 2022, net income associated with the PPP program was $1.2 million or $0.14 per fully diluted share, a decrease of 6% compared to $1.3 million or $0.14 per fully diluted share for the first quarter of 2022.

“The highlight for the quarter was again generating strong core loan growth (non-PPP) which continues a shift in our assets from investments to quality loans serving the needs of our community. As a result of the loan growth the last twelve months, loan interest income (non-PPP) has increased meaningfully in the second quarter of 2022 over 2021. Core loan growth from the second half of 2021 through the second quarter of 2022 has enabled the Bank to replace and surpass the significant income generated from PPP that was essential to bridge the pandemic rate shock. The strength of the Bank’s balance sheet coupled with our disciplined approach to business banking has enabled us to capitalize on opportunities. Although, core loan production has slowed somewhat from recent record highs, the pipeline remains robust with the addition of new relationship managers this year,” commented Leon Blankstein, ABB’s President, CEO, and Director.

For the quarter ending June 30, 2022, net interest income was $29.9 million, a 6% increase over the first quarter of 2022, as interest income on loans increased by $2.1 million as the average loan portfolio, (excluding PPP), grew by $159 million. This increase was offset by a decline of $0.4 million in interest income on securities mainly due to a non-recurring prepayment penalty. For the quarters ending June 30, 2022 and March 31, 2022, the cost of deposits remained at 0.04%. The provision for loan losses was $1.0 million in the quarter commensurate with the growth in core loans. The allowance for loan losses as a percentage of loans, excluding PPP loans, was 1.24% at June 30, 2022.

For the six months ended June 30, 2022, net income was $21.4 million or $2.33 per fully diluted share compared to $18.0 million or $1.98 per fully diluted share for the six months ended June 30, 2021. The increase was primarily due to an increase in interest on investment securities of $4.2 million as a result of an increase in average investment securities and an increase in interest on loans of $2.1 million as a result of core loan growth. This additional income was partially offset by the $2.5 million provision for loan losses recorded in the first half of 2022.

Net Interest Margin

Net interest margin for the second quarter of 2022 was 3.21% compared to 3.00% in the first quarter of 2022 and 3.00% in the second quarter of 2021. Excluding the impact of PPP loans, the net interest margin was 3.06% for the second quarter of 2022 compared to 2.89% for the first quarter of 2022 reflecting the higher percentage of core loans to assets. As of June 30, 2022, 63% of the loan portfolio was fixed rate, of the variable rate loans, approximately half are indexed to prime and 81% of these loans are at or above interest rate floors.

Net Interest Income

For the quarter ending June 30, 2022, net interest income increased by $1.7 million, or 6%, compared to the first quarter of 2022 and increased by $2.8 million, or 10% compared to the quarter ended June 30, 2021. The increase is a result of the Bank’s strong core loan growth and rising interest rates offset by the decrease in the accelerated realization of net deferred PPP processing fees and decrease in interest income on securities. The increase is a result strong core loan growth and increase in investment securities offset by the decrease in the accelerated realization of net deferred PPP processing fees.

(Figures in $000s, except per share amounts)	As of or For the Six Months Ended:					As of or For the Three Months Ended:
	June 2022		June 2021			June 2022		March 2022		June 2021
PPP loans - first round, net	$	4,877	$	152,827		$	4,877	$	6,391	$	152,827
PPP loans - second round, net		18,054		233,561			18,054		79,997		233,561
PPP Total Loans, net	$	22,931	$	386,388		$	22,931	$	86,388	$	386,388
1% Coupon Interest	$	422	$	2,930		$	145	$	277	$	1,403
Amortized fees		254		1,288			82		171		620
Accelerated fees		2,962		6,891			1,535		1,427		4,046
Total PPP loan income	$	3,637	$	11,109		$	1,762	$	1,875	$	6,069
Total PPP loan income after tax	$	2,565	$	7,835		$	1,242	$	1,322	$	4,280
Total PPP loan income after tax per share - diluted	$	0.28	$	0.86		$	0.14	$	0.14	$	0.47

As of July 12, 2022, approximately 98% of PPP loans originated in 2020 and 95% of PPP loans originated in 2021 have been forgiven. Of the remaining PPP loans originated in 2020 and 2021, approximately 21% are in the forgiveness review or submission process.

On a year-to-date basis, net interest income was $58.1 million for the six months ended June 30, 2022, compared to $51.6 million for the same period a year ago. The increase of $6.5 million or 13% is primarily due to an increase in interest on core loans of $9.6 million due to strong core loan growth and an increase in interest on investment securities of $4.2 million as a result of an increase in the average balance of investment securities. These increases were offset by the decrease in PPP loan income of $7.5 million.

Non-Interest Income

The decreases in non-interest income from the prior quarter and the same quarter a year ago as well as year-to-date are primarily due to the decline in the value of Bank/Corporate owned life insurance (BOLI) policies that are invested in mutual funds.

Non-Interest Expense

For the quarter ending June 30, 2022, total non-interest expense decreased $685 thousand compared to the first quarter of 2022 primarily due to a decrease in salaries and employee benefits. The efficiency ratio decreased to 45% compared to 50% for the first quarter of 2022.

Non-interest expense decreased $2.5 million for the quarter ended June 30, 2022 compared to the second quarter of 2021. This was driven by a decrease in salaries and employee benefits related to less expense for the deferred compensation plan associated with the decline in BOLI that are invested in mutual funds. The efficiency ratio declined to 45% for the second quarter of 2022 compared to 58% for the second quarter of 2021.

There were 205 full time equivalent employees at June 30, 2022 compared to 192 a year ago and 198 at March 31, 2022. The Bank has 41 relationship managers in eight offices representing an increase of six from a year ago and an increase of three from the prior quarter.

On a year-to-date basis, non-interest expense for the six months ended June 30, 2022 decreased $1.7 million or 6% compared to the same period a year ago, mainly due to the settlement of a legal matter which occurred in the second quarter of 2021.

Balance Sheet

From March 31, 2022 to June 30, 2022, total core loans, excluding PPP loans, increased $129 million, or 6%. During the second quarter of 2022, CRE loans increased by $104 million, primarily due to increases of $73 million in non-owner-occupied and $23 million in owner-occupied CRE.

	June 30, 2022			March 31, 2022
(Figures in $000s)
RE - Owner Occupied	$	928,248		$	903,372
RE - Non Owner Occupied		600,180			526,898
Multifamily		10,157			11,327
Construction & Land		61,910			55,087
Total CRE Loans	$	1,600,494		$	1,496,684

In addition, C&I loans increased by $17 million during the second quarter of 2022, benefitting from higher line utilization. At June 30, 2022, the utilization rate for the Bank’s commercial lines of credit increased to 32% from 30% at March 31, 2022.

Investment securities decreased from the first quarter of 2022 to $1.36 billion. As of June 30, 2022, the duration of the securities portfolio increased to 6.5 years from 5.7 years as of March 31, 2022 as market interest rates increased. Accumulated other comprehensive loss increased to $67.6 million as of June 30, 2022 from $39.6 million as of March 31, 2022 due to the increase in net unrealized loss on the available-for-sale securities portfolio.

During the second quarter of 2022, total assets decreased $50 million, or 1%, and total deposits decreased by $71 million.

At June 30, 2022, the tangible common equity ratio was 6.3%, as the benefit of second quarter net income was more than offset by a larger Accumulated Other Comprehensive Loss, reflecting the impact of higher rates on net unrealized securities losses. The loan growth over the last year has increased risk-weighted assets resulting in a decrease in those capital ratios, which remain well above regulatory requirements.

Asset Quality

The following table presents asset quality overview as of the dates indicated:

	June 30, 2022				March 31, 2022
(Figures in $000s)
Non-performing assets (NPA)	$	1,208			$	-
Loans 90+ Days Past Due and Still Accruing		-				-
Total NPA	$	1,208			$	-
NPA as a % of total assets, excluding PPP		0.03	%			0.00	%
Past Due as a % of total Loans, excluding PPP		0.00	%			0.00	%
Criticized as a % of total Loans, excluding PPP		2.41	%			2.49	%
Classified as a % of total Loans, excluding PPP		0.20	%			0.14	%

As of June 30, 2022, the Bank had $30 thousand specific reserve related to two C&I impaired loan relationships.

The following table represents the allowance for loan losses as of and for the dates and periods indicated:

	Three Months Ended								Six Months Ended
	June 30, 2022				March 31, 2022				June 30, 2022				June 30, 2021
(Figures in $000s)
Beginning Balance	$	26,561			$	25,062			$	25,062			$	22,931
Charge-offs		-				-				-				-
Recoveries		23				13				36				410
Net (charge-offs) / recoveries	$	23			$	13			$	36			$	410
Provision		1,024				1,486				2,510				-
Ending Balance	$	27,608			$	26,561			$	27,608			$	23,341
Allowance as a % of total assets, excluding PPP		1.24	%			1.27	%			1.24	%			1.40	%

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. There are no loans on a loan payment deferment program.

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 seven 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, Inland Empire in Ontario and LA Coastal in Long Beach.

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
									2022				2022				2021				2021
Assets:
	Cash and Due from Banks							$	68,512			$	48,531			$	33,246			$	74,242
	Interest Earning Deposits in Other Financial Institutions								22,277				63,022				195,624				269,596
	Investment Securities:
		US Agencies							145,380				169,832				185,170				210,849
		Mortgage Backed Securities							479,027				545,447				808,496				577,726
		State and Municipals							110,586				122,868				231,917				213,729
		US Treasuries							-				-				-				-
		Corporate Bonds							13,758				14,044				12,903				10,966
			Securities Available-for-Sale, at Fair Value						748,751				852,191				1,238,486				1,013,270
		Mortgage Backed Securities							198,021				204,025				-				-
		State and Municipals							395,679				396,748				298,651				255,953
			Securities Held-to-Maturity, at Amortized Cost						593,700				600,773				298,651				255,953
		Federal Home Loan Bank Stock, at Cost							15,000				11,779				11,779				11,779
			Total Investment Securities						1,357,451				1,464,743				1,548,916				1,281,002
	Loans Receivable:
		Commercial Real Estate							1,600,494				1,496,684				1,371,475				1,193,612
		Commercial and Industrial							510,020				492,822				444,009				364,019
		SBA Payroll Protection Program							22,931				86,387				143,584				386,388
		Residential Real Estate							109,853				102,305				112,817				105,711
		Installment and Other							6,103				5,756				5,897				4,261
			Total Loans Receivable						2,249,401				2,183,954				2,077,782				2,053,991
			Allowance for Loan Losses						(27,608	)			(26,561	)			(25,062	)			(23,341	)
			Loans Receivable, Net						2,221,793				2,157,393				2,052,720				2,030,650
	Furniture, Equipment and Leasehold Improvements, Net								6,025				6,327				6,580				7,074
	Bank/Corporate Owned Life Insurance								28,013				28,622				28,851				28,325
	Other Assets								73,301				58,242				46,339				41,440
		Total Assets						$	3,777,372			$	3,826,880			$	3,912,276			$	3,732,329
Liabilities:
	Non-Interest Bearing Demand Deposits							$	1,850,325			$	1,920,015			$	1,934,444			$	1,830,832
	Interest Bearing Transaction Accounts								287,444				277,016				287,224				257,726
	Money Market and Savings Deposits								1,284,994				1,297,039				1,337,035				1,311,603
	Certificates of Deposit								41,446				40,998				39,445				34,543
			Total Deposits						3,464,209				3,535,068				3,598,148				3,434,704
	Federal Home Loan Bank Advances / Other Borrowings								40,000				-				-				-
	Other Liabilities								33,785				36,588				35,574				35,031
		Total Liabilities						$	3,537,994			$	3,571,656			$	3,633,722			$	3,469,735
Shareholders' Equity:
	Common Stock							$	204,057			$	203,400			$	202,199			$	200,904
	Retained Earnings								102,878				91,443				81,521				60,337
	Accumulated Other Comprehensive Income / (Loss)								(67,557	)			(39,619	)			(5,166	)			1,353
		Total Shareholders' Equity						$	239,378			$	255,224			$	278,554			$	262,594
		Total Liabilities and Shareholders' Equity						$	3,777,372			$	3,826,880			$	3,912,276			$	3,732,329
	Standby Letters of Credit							$	36,793			$	36,698			$	35,891			$	33,184
Per Share Information:
	Common Shares Outstanding								8,929,796				8,913,974				8,832,797				8,799,072
	Book Value Per Share							$	26.81			$	28.63			$	31.54			$	29.84
	Tangible Book Value Per Share							$	26.81			$	28.63			$	31.54			$	29.84
*	All per share amounts and number of shares outstanding have been retroactively applied for the 10% stock dividend paid in July 2021

American Business Bank
Figures in $000, except share and per share amounts
INCOME STATEMENTS (unaudited)
								For the three months ended:
								June				March				June
									2022				2022				2021
Interest Income:
	Interest and Fees on Loans							$	23,985			$	21,809			$	22,861
	Interest on Investment Securities								6,282				6,658				4,626
	Interest on Interest Earning Deposits in Other Financial Institutions								63				80				99
	Total Interest Income								30,330				28,547				27,586
Interest Expense:
	Interest on Interest Bearing Transaction Accounts								31				26				40
	Interest on Money Market and Savings Deposits								308				323				426
	Interest on Certificates of Deposits								10				10				12
	Interest on Federal Home Loan Bank Advances and Other Borrowings								93				-				-
	Total Interest Expense								442				359				478
Net Interest Income									29,888				28,188				27,108
	Provision for Loan Losses								1,024				1,486				-
Net Interest Income after Provision for Loan Losses									28,864				26,702				27,108
Non-Interest Income:
	Deposit Fees								1,018				960				763
	International Fees								378				337				260
	Gain (Loss) on Sale of Investment Securities, Net								(97	)			30				-
	Gain on Sale of SBA Loans, Net								-				-				-
	Bank/Corporate Owned Life Insurance Income (Expense)								(609	)			(229	)			255
	Other								404				293				192
	Total Non-Interest Income								1,094				1,391				1,470
Non-Interest Expense:
	Salaries and Employee Benefits								9,487				10,475				10,231
	Occupancy and Equipment								1,113				1,165				1,151
	Professional Services								1,744				1,681				1,560
	Promotion Expenses								403				320				297
	Other								1,273				1,064				3,226
	Total Non-Interest Expense								14,020				14,705				16,465
Earnings before income taxes									15,938				13,388				12,113
	Income Tax Expense								4,504				3,465				3,054
NET INCOME								$	11,434			$	9,923			$	9,059
Per Share Information:
	Earnings Per Share - Basic							$	1.26			$	1.10			$	1.01
	Earnings Per Share - Diluted							$	1.24			$	1.08			$	1.00
	Weighted Average Shares - Basic								9,098,568				9,040,825				8,961,797
	Weighted Average Shares - Diluted								9,189,551				9,167,184				9,095,569
*	All per share amounts and number of shares outstanding have been retroactively applied for the 10% stock dividend paid in July 2021

American Business Bank
Figures in $000, except share and per share amounts
INCOME STATEMENTS (unaudited)
					For the six months ended:
					June				June
						2022				2021
Interest Income:
	Interest and Fees on Loans				$	45,794			$	43,635
	Interest on Investment Securities					12,939				8,748
	Interest on Interest Earning Deposits in Other Financial Institutions					143				165
	Total Interest Income					58,876				52,548
Interest Expense:
	Interest on Interest Bearing Transaction Accounts					57				81
	Interest on Money Market and Savings Deposits					630				840
	Interest on Certificates of Deposits					20				26
	Interest on Federal Home Loan Bank Advances and Other Borrowings					93				-
	Total Interest Expense					800				947
Net Interest Income						58,076				51,601
	Provision for Loan Losses					2,510				-
Net Interest Income after Provision for Loan Losses						55,566				51,601
Non-Interest Income:
	Deposit Fees					1,978				1,507
	International Fees					715				523
	Gain (Loss) on Sale of Investment Securities, Net					(67	)			(15	)
	Gain on Sale of SBA Loans, Net					-				-
	Bank/Corporate Owned Life Insurance Income (Expense)					(838	)			587
	Other					697				394
	Total Non-Interest Income					2,485				2,996
Non-Interest Expense:
	Salaries and Employee Benefits					19,963				19,893
	Occupancy and Equipment					2,278				2,297
	Professional Services					3,424				3,263
	Promotion Expenses					724				519
	Other					2,336				4,426
	Total Non-Interest Expense					28,725				30,398
Earnings before income taxes						29,326				24,199
	Income Tax Expense					7,969				6,224
NET INCOME					$	21,357			$	17,975
Per Share Information:
	Earnings Per Share - Basic				$	2.35			$	2.01
	Earnings Per Share - Diluted				$	2.33			$	1.98
	Weighted Average Shares - Basic					9,069,697				8,941,869
	Weighted Average Shares - Diluted					9,178,368				9,064,349
*	All per share amounts and number of shares outstanding have been retroactively applied for the 10% stock dividend

American Business Bank
Figures in $000
QUARTERLY AVERAGE BALANCE SHEETS AND YIELD ANALYSIS (unaudited)
					For the three months ended:
					June 2022											March 2022
					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					$	41,523		$	63		0.61	%				$	162,969		$	80		0.20	%
Investment Securities:
US Agencies						157,180			1		0.00	%					177,077			91		0.21	%
Mortgage Backed Securities						775,309			3,054		1.58	%					805,321			3,361		1.67	%
State and Municipals						519,137			2,870		2.21	%					523,835			2,913		2.22	%
US Treasuries						-			-		0.00	%					-			-		0.00	%
Corporate Bonds						14,250			132		3.71	%					13,000			113		3.47	%
Securities Available-for-Sale and Held-to-Maturity						1,465,876			6,057		1.65	%					1,519,233			6,478		1.71	%
Federal Home Loan Bank Stock						14,363			225		6.27	%					11,779			180		6.10	%
Total Investment Securities						1,480,239			6,282		1.70	%					1,531,012			6,658		1.74	%
Loans Receivable:
Commercial Real Estate						1,540,228			15,686		4.08	%					1,418,952			14,180		4.05	%
Commercial and Industrial						506,220			5,371		4.26	%					465,403			4,691		4.09	%
SBA Payroll Protection Program						57,428			1,762		12.31	%					110,355			1,875		6.89	%
Residential Real Estate						106,847			1,092		4.10	%					109,759			1,011		3.74	%
Installment and Other						7,024			74		4.23	%					6,746			52		3.10	%
Total Loans Receivable						2,217,747			23,985		4.34	%					2,111,215			21,809		4.19	%
Total Interest Earning Assets					$	3,739,509		$	30,330		3.21	%				$	3,805,196		$	28,547		3.00	%
Liabilities:
Non-Interest Bearing Demand Deposits						1,902,386			-		0.00	%					1,984,694			-		0.00	%
Interest Bearing Transaction Accounts						278,539			31		0.04	%					274,988			26		0.04	%
Money Market and Savings Deposits						1,254,257			308		0.10	%					1,303,545			323		0.10	%
Certificates of Deposit						41,303			10		0.10	%					40,270			10		0.10	%
Total Deposits						3,476,485			349		0.04	%					3,603,497			359		0.04	%
Federal Home Loan Bank Advances / Other Borrowings						46,473			93		0.80	%					-			-		0.00	%
Total Interest Bearing Deposits and Borrowings						1,620,572			442		0.11	%					1,618,803			359		0.09	%
Total Deposits and Borrowings					$	3,522,958		$	442		0.05	%				$	3,603,497		$	359		0.04	%
Net Interest Income								$	29,888										$	28,188
Net Interest Rate Spread											3.16	%										2.96	%
Net Interest Margin											3.21	%										3.00	%
Net Interest Margin, excluding SBA PPP											3.06	%										2.89	%

American Business Bank
Figures in $000
QUARTERLY AVERAGE BALANCE SHEETS AND YIELD ANALYSIS (unaudited)
						For the three months ended:
						June 2022												June 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					$	41,523		$		63		0.61	%				$		329,324		$		99		0.12	%
	Investment Securities:
	US Agencies						157,180				1		0.00	%						216,143				383		0.71	%
	Mortgage Backed Securities						775,309				3,054		1.58	%						466,148				1,565		1.34	%
	State and Municipals						519,137				2,870		2.21	%						435,608				2,394		2.20	%
	US Treasuries						-				-		0.00	%						-				-		0.00	%
	Corporate Bonds						14,250				132		3.71	%						10,085				82		3.25	%
	Securities Available-for-Sale and Held-to-Maturity						1,465,876				6,057		1.65	%						1,127,984				4,424		1.57	%
	Federal Home Loan Bank Stock						14,363				225		6.27	%						11,628				202		6.95	%
	Total Investment Securities						1,480,239				6,282		1.70	%						1,139,612				4,626		1.62	%
	Loans Receivable:
	Commercial Real Estate						1,540,228				15,686		4.08	%						1,163,231				11,944		4.12	%
	Commercial and Industrial						506,220				5,371		4.26	%						340,067				3,921		4.62	%
	SBA Payroll Protection Program						57,428				1,762		12.31	%						555,338				6,069		4.38	%
	Residential Real Estate						106,847				1,092		4.10	%						93,126				889		3.83	%
	Installment and Other						7,024				74		4.23	%						5,613				38		2.75	%
	Total Loans Receivable						2,217,747				23,985		4.34	%						2,157,375				22,861		4.25	%
	Total Interest Earning Assets					$	3,739,509		$		30,330		3.21	%				$		3,626,311		$		27,586		3.01	%
Liabilities:
	Non-Interest Bearing Demand Deposits						1,902,386				-		0.00	%						1,871,930				-		0.00	%
	Interest Bearing Transaction Accounts						278,539				31		0.04	%						267,490				40		0.06	%
	Money Market and Savings Deposits						1,254,257				308		0.10	%						1,278,436				426		0.13	%
	Certificates of Deposit						41,303				10		0.10	%						34,446				12		0.14	%
	Total Deposits						3,476,485				349		0.04	%						3,452,302				478		0.06	%
	Federal Home Loan Bank Advances / Other Borrowings						46,473				93		0.80	%						7				-		0.37	%
	Total Interest Bearing Deposits and Borrowings						1,620,572				442		0.11	%						1,580,379				478		0.12	%
	Total Deposits and Borrowings					$	3,522,958		$		442		0.05	%				$		3,452,309		$		478		0.06	%
	Net Interest Income								$		29,888											$		27,108
	Net Interest Rate Spread												3.16	%												2.95	%
	Net Interest Margin												3.21	%												3.00	%
	Net Interest Margin, excluding SBA PPP												3.06	%												2.75	%

American Business Bank
Figures in $000
QUARTERLY AVERAGE BALANCE SHEETS AND YIELD ANALYSIS (unaudited)
						For the six months ended:
						June 2022									June 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					$	101,911		$	143		0.28	%		$	273,160		$	165		0.12	%
	Investment Securities:
	US Agencies						167,073			92		0.11	%			220,619			790		0.72	%
	Mortgage Backed Securities						790,232			6,415		1.62	%			432,702			2,794		1.29	%
	State and Municipals						521,473			5,782		2.22	%			425,248			4,662		2.19	%
	US Treasuries						-			-		0.00	%			-			-		0.00	%
	Corporate Bonds						13,628			245		3.59	%			10,179			164		3.23	%
	Securities Available-for-Sale and Held-to-Maturity						1,492,406			12,534		1.68	%			1,088,748			8,410		1.54	%
	Federal Home Loan Bank Stock						13,078			405		6.19	%			11,248			338		6.01	%
	Total Investment Securities						1,505,484			12,939		1.72	%			1,099,996			8,748		1.59	%
	Loans Receivable:
	Commercial Real Estate						1,479,925			29,866		4.07	%			1,134,719			23,405		4.16	%
	Commercial and Industrial						485,924			10,062		4.18	%			335,448			7,383		4.44	%
	SBA Payroll Protection Program						83,746			3,637		8.76	%			582,338			11,110		3.85	%
	Residential Real Estate						108,295			2,103		3.92	%			85,622			1,648		3.88	%
	Installment and Other						6,886			126		3.68	%			5,287			89		3.40	%
	Total Loans Receivable						2,164,776			45,794		4.27	%			2,143,414			43,635		4.11	%
	Total Interest Earning Assets					$	3,772,171		$	58,876		3.10	%		$	3,516,570		$	52,548		2.97	%
Liabilities:
	Non-Interest Bearing Demand Deposits						1,943,313			-		0.00	%			1,801,668			-		0.00	%
	Interest Bearing Transaction Accounts						276,773			57		0.04	%			261,487			81		0.06	%
	Money Market and Savings Deposits						1,278,765			630		0.10	%			1,251,077			840		0.14	%
	Certificates of Deposit						40,789			20		0.10	%			34,654			26		0.15	%
	Total Deposits						3,539,640			707		0.04	%			3,348,886			947		0.06	%
	Federal Home Loan Bank Advances / Other Borrowings						23,365			93		0.80	%			4			-		0.37	%
	Total Interest Bearing Deposits and Borrowings						1,619,692			800		0.10	%			1,547,222			947		0.12	%
	Total Deposits and Borrowings					$	3,563,005		$	800		0.05	%		$	3,348,890		$	947		0.06	%
	Net Interest Income								$	58,076								$	51,601
	Net Interest Rate Spread											3.05	%								2.91	%
	Net Interest Margin											3.10	%								2.96	%
	Net Interest Margin, excluding SBA PPP											2.98	%								2.78	%

American Business Bank
Figures in $000
SUPPLEMENTAL DATA (unaudited)
								June				March				December				June
									2022				2022				2021				2021
Performance Ratios:
	Quarterly:
	Return on Average Assets (ROAA)								1.20	%			1.01	%			0.97	%			0.97	%
	Return on Average Equity (ROAE)								18.56	%			14.48	%			14.17	%			14.21	%
	Efficiency Ratio								45.11	%			49.77	%			51.10	%			57.61	%
	Year-to-Date
	Return on Average Assets (ROAA)								1.11	%			1.01	%			1.03	%			0.99	%
	Return on Average Equity (ROAE)								16.42	%			14.48	%			14.95	%			14.26	%
	Efficiency Ratio								47.38	%			49.77	%			51.77	%			55.66	%
Capital Adequacy:
	Total Risk Based Capital Ratio								12.66	%			12.82	%			13.21	%			14.26	%
	Common Equity Tier 1 Capital Ratio								11.58	%			11.72	%			12.09	%			13.01	%
	Tier 1 Risk Based Capital Ratio								11.58	%			11.72	%			12.09	%			13.01	%
	Tier 1 Leverage Ratio								8.07	%			7.53	%			7.09	%			6.98	%
	Tangible Common Equity / Tangible Assets								6.34	%			6.67	%			7.12	%			7.04	%
Asset Quality Overview
	Non-Performing Loans							$	1,208			$	-			$	338			$	54
	Loans 90+ Days Past Due and Still Accruing								-				-				-				-
		Total Non-Performing Loans							1,208				-				338				54
	Restructured Loans								-				-				-				214
	Other Real Estate Owned								-				-				-				-
	ALLL / Loans Receivable								1.23	%			1.22	%			1.21	%			1.14	%
	Non-Performing Loans / Total Loans Receivable *								0.05	%			0.00	%			0.02	%			0.01	%
	Non-Performing Loans / Total Loans Receivable *, excluding PPP **								0.05	%			0.00	%			0.02	%			0.02	%
	Non-Performing Assets / Total Assets *								0.03	%			0.00	%			0.01	%			0.01	%
	Non-Performing Assets / Total Assets *, excluding PPP **								0.03	%			0.00	%			0.01	%			0.01	%
	Net Charge-Offs (Recoveries) quarterly							$	(23	)		$	(13	)		$	(27	)		$	(395	)
	Net Charge-Offs (Recoveries) year-to-date							$	(37	)		$	(13	)		$	(178	)		$	(411	)
	Net Charge-Offs (Recoveries) year-to-date / Average								(0.00	%)			(0.00	%)			(0.01	%)			(0.02	%)
		Loans Receivable
*	Includes non-accrual loans, accruing loans past due 90+ days and Troubled Debt Restructurings (TDRs).
**	SBA Paycheck Protection Program (PPP)

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20220728005172/en/

Karen Schoenbaum

EVP/CFO

(213) 430-4000

www.americanbb.bank

Source: American Business Bank

FAQ

What was American Business Bank's net income for Q2 2022?

American Business Bank reported a net income of $11.4 million for Q2 2022.

How much did core loans increase for American Business Bank in Q2 2022?

Core loans increased by $129 million, or 25% annualized, in Q2 2022.

What was the net interest income for American Business Bank in Q2 2022?

Net interest income for Q2 2022 was $29.9 million.

What is the efficiency ratio reported by American Business Bank for Q2 2022?

The efficiency ratio improved to 45% for Q2 2022.

Did American Business Bank experience growth in non-performing assets?

No, the non-performing assets to total assets ratio remained low at 0.03%.