Beach Cities Commercial Bank Announces Fourth Quarter 2024 Financial Results

Rhea-AI Summary

Beach Cities Commercial Bank (OTCQB: BCCB) has released its Q4 2024 financial results, showing significant growth in key metrics. Total assets reached $130.8 million, up 173% year-over-year, while total loans increased 378% to $105.6 million. Deposits grew 337% to $112.9 million.

The bank maintained strong liquidity at $22.1 million (16.9% of total assets) and a healthy loan portfolio yield of 8.05% with a net interest margin of 4.21%. However, shareholders' equity decreased by $4.2 million to $15.2 million, primarily due to $927k in credit loss provisions and $3.3 million in operating losses.

Q4 2024 resulted in a net loss of $989k, with year-to-date losses at $4.52 million. The bank's loan portfolio grew by $27.5 million in Q4, necessitating increased credit reserve provisions of $371k. The bank maintains zero delinquent or non-performing loans and remains well-capitalized with a tier 1 capital ratio of 14.2%.

Positive

• Total assets grew 173% YoY to $130.8 million
• Loan portfolio increased 378% YoY to $105.6 million
• Deposits rose 337% YoY to $112.9 million
• Strong loan portfolio yield at 8.05%
• Zero delinquent and non-performing loans
• Well-capitalized with 14.2% tier 1 capital ratio
• Q4 interest income increased 16% QoQ to $1.86 million

Negative

• Q4 2024 net loss of $989k
• Full-year 2024 net loss of $4.52 million
• Shareholders' equity decreased by $4.2 million YoY
• Increased credit loss provisions to $371k in Q4
• Rising interest expenses due to high-cost institutional CD deposits

IRVINE, Calif.--(BUSINESS WIRE)-- Beach Cities Commercial Bank, www.beachcitiescb.com (OTCQB: BCCB) (the "Bank"), today announced financial results for the quarter ended December 31, 2024.

The Bank was incorporated under the laws of the State of California on April 11, 2022. The Bank opened for business on June 12, 2023, after receiving all necessary regulatory approvals, and it began providing a full range of banking services from its branch locations in Irvine and Encinitas, California. The Bank operates primarily in the Southern California commercial markets, offering business and personal deposit accounts. The lending products include loans secured by commercial real estate, commercial and industrial loans, guidance lines of credit supporting bridge loans, lines of credit, SBA 7A and 504 loans, SBA express lines of credit, and State guaranteed loans. The Bank has a state-of-the-art technology platform and offers cash management products and services to allow its customers the ability to focus on their business and not worry about banking.

Significant items for the period include:

• Total assets were $130.8 million as of December 31, 2024, which increased by $83.0 million from December 31, 2023 (173% growth).
• Total loans were $105.6 million as of December 31, 2024, which increased by $84.0 million from December 31, 2023 (378% growth).
• Total deposits were $112.9 million as of December 31, 2024, which increased by $87.0 million from December 31, 2023 (337%).
• Total liquidity remains high at $22.1 million, which equates to 16.9% of the Bank's total assets. The Bank also maintains contingent borrowing sources at $33.2 million which equates to 25.3% of total assets.
• The loan portfolio average yield was 8.05% which contributed to a healthy net interest margin at 4.21% as of December 31, 2024.
• The Bank maintains a reserve for credit losses of $1.214 million which equates to 1.15% of total loans. As of December 31, 2024, the Bank had zero dollars in delinquent, and non-performing loans.

The shareholders’ equity was at $15.2 million as of December 31, 2024, which was reduced by $4.2 million from December 31, 2023. The reduction was mainly due to the recording of $927k in credit loss provisions and $3.3 million in operating losses. The Bank’s tier 1 capital to average assets ratio was at 14.2% which is considered well-capitalized under the regulatory framework.

The Bank reported fourth quarter 2024 net loss of $989k and year-to-date 2024 net loss of $4.52 million. During the fourth quarter, the Bank increased its loan portfolio by $27.5 million. Due to the loan growth, the credit reserve provisions were increased by $371k during the fourth quarter 2024 compared to $117k in the third quarter 2024. Pre-credit provision loss during the fourth quarter 2024 was $618k compared to $823k during the third quarter 2024.

During the fourth quarter 2024 the total interest income was $1.86 million compared to $1.61 million recorded during the third quarter 2024, an increase of 16%. The Bank’s interest expense from the interest-bearing deposits was $847k for the fourth quarter 2024 compared to $716k for the third quarter 2024, an increase of 20%. The interest expense increased due to the growth in the short-term institutional CDs deposits. The Bank has launched a campaign to replace these high-cost institutional CD deposits with non-interest-bearing deposits to reduce the interest cost. The fourth quarter 2024 net interest income increased by $110k from the third quarter 2024, an increase of 12%.

In the fourth quarter 2024, the Bank sold SBA loans which netted $127k in gain on sale.

Total non-interest expenses for the fourth quarter 2024 were $1.735 million compared to $1.721 million incurred during the third quarter 2024, a slight increase of $14k. The Bank continues to manage its operating expenses tightly.

As noted above, the Bank’s liquidity remains above 16.9% of total assets. The Bank has also established contingent lines of borrowings with its correspondent banks, including Federal Home Loan Bank of San Francisco. As of December 31, 2024, total contingent borrowing sources unused totaled $33 million or 25% of total assets outstanding.

“The Bank’s balance sheet continues to grow in a safe and sound manner. As we wrap up 2024, we are excited about 2025 in achieving profitability. Our Board, and the entire Beach Cities Commercial Bank team is laser focused in achieving our strategic goals and objectives,” commented H. Kent Falk, CEO.

“Our commercial and real estate lending is off to a great start. During the first quarter 2025, the Bank will be applying for the Preferred Lending Status (PLP) with the Small Business Administration (SBA). This will provide the Bank with a huge competitive advantage in offering SBA loans,” stated Jeffrey Redeker, President.

About Beach Cities Commercial Bank

Beach Cities Commercial Bank is a full-service bank, serving the business, commercial and professional markets. The Bank meets the financial needs of its business clients with loans for working capital, equipment, owner-occupied and investment commercial real estate, and a full array of cash management services and deposit products for businesses and their owners. Beach Cities Commercial Bank meets its clients’ needs through its head office and branch in Irvine and regional office and branch in Encinitas, California. The Bank’s stock is currently trading on the OTCQB platform under the “BCCB” stock symbol. For more information, please visit www.beachcitiescb.com/investor-relations.

FORWARD-LOOKING STATEMENT: This news release contains a number of forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). These statements may be identified using words such as "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "likely," "may," "outlook," "plan," "potential," "predict," "project," "should," "will," "would" and similar terms and phrases, including references to assumptions. Forward-looking statements are based upon various assumptions and analyses made by the Bank (which includes the Bank) considering management's experience and its perception of historical trends. Current conditions and expected future developments, as well as other factors it believes are appropriate under the circumstances. These statements do not guarantee future performance and are subject to risks, uncertainties, and other factors (many of which are beyond the Bank's control) that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Accordingly, you should not place undue reliance on such statements. Factors that could affect the Bank's results include, without limitation, the following: the timing and occurrence or non-occurrence of events may be subject to circumstances beyond the Bank's control; there may be increases in competitive pressure among financial institutions or from non-financial institutions; changes in the interest rate environment may reduce interest margins; changes in deposit flows, loan demand or real estate values may adversely affect the business of the Bank; unanticipated or significant increases in loan losses; changes in accounting principles, policies or guidelines may cause the Bank's financial condition to be perceived differently; changes in corporate and/or individual income tax laws may adversely affect the Bank's financial condition or results of operations; general economic conditions, either nationally or locally in some or all areas in which the Bank conducts business, or conditions in the securities markets or the banking industry may be less favorable than the Bank currently anticipates; legislation or regulatory changes may adversely affect the Bank's business; technological changes may be more difficult or expensive than the Bank anticipates; there may be failures or breaches of information technology security systems; success or consummation of new business initiatives may be more difficult or expensive than the Bank anticipates; or litigation or other matters before regulatory agencies, whether currently existing or commencing in the future, may delay the occurrence or non-occurrence of events longer than the Bank anticipates.

Beach Cities Commercial Bank
Unaudited Statements of Financial Condition
Asset		As of Dec 31, 2024			As of Sept 30, 2024			Qtr. Growth $			Qtr. Growth %		As of Dec 31, 2023			Annual Growth $			Annual Growth %
Total Cash and Cash Equivalent		22,112,065			15,649,897			6,462,168			41%		21,981,078			130,986			1%
Debt Securities Available for Sale		984,026			974,284			9,742			1%		979,802			4,224			0%
Gross Loans		105,648,161			78,105,307			27,542,854			35%		22,080,937			83,567,224			378%
Allowance for Credit Losses		(1,214,000	)		(843,000	)		(371,000	)		(44%)		(301,000	)		(913,000	)		(303%)
Net Loans		104,434,161			77,262,307			27,171,854			35%		21,779,937			82,654,224			379%
Total Fixed Assets		189,608			205,627			(16,019	)		(8%)		267,726			(78,118	)		(29%)
Right of Use Assets		1,386,721			1,477,169			(90,448	)		(6%)		1,741,353			(354,632	)		(20%)
Prepaids		1,061,411			1,054,014			7,396			1%		1,101,451			(40,040	)		(4%)
Total Other Assets		617,725			418,483			199,242			48%		105,425			512,300			486%
Total Assets		130,785,716			97,041,781			33,743,935			35%		47,956,772			82,828,944			173%
Non-Interest Bearing Deposits		13,870,624			12,035,356			1,835,269			15%		6,672,688			7,197,936			108%
NOW Deposits		938,289			847,662			90,626			11%		182,997			755,292			413%
Money Market Deposits		48,539,815			30,948,601			17,591,214			57%		18,328,941			30,210,874			165%
Total Demand Deposits		63,348,728			43,831,619			19,517,109			45%		25,184,625			38,164,103			152%
Savings Accounts		5,058,477			45,736			5,012,740			10,960%		27,415			5,031,062			18,352%
Total CDs		44,484,698			31,946,029			12,538,669			39%		646,368			43,838,330			6,782%
Total Deposits		112,891,903			75,823,384			37,068,519			49%		25,858,408			87,033,495			337%
Other Borrowed < 1 Yr		-			2,300,000			(2,300,000	)		(100%)		-			-			0%
Total Other Liabilities		2,661,936			2,801,028			(139,092	)		(5%)		2,711,566			(49,630	)		(2%)
Total Liabilities		115,553,839			80,924,412			34,629,426			43%		28,569,974			86,983,865			304%
Common Stock		25,116,895			25,116,895			-			0%		25,561,120			(444,225	)		(2%)
Additional Paid in Capital		470,347			365,754			104,594			29%		(342,303	)		812,650			237%
Accumulated Deficit		(10,355,311	)		(9,366,752	)		(988,559	)		(11%)		(5,831,486	)		(4,523,826	)		(78%)
Accumulated other comprehensive loss		(54	)		1,472			(1,526	)		(104%)		(533	)		479			90%
Total Shareholders' Equity		15,231,877			16,117,369			(885,491	)		(5%)		19,386,799			(4,154,921	)		(21%)
Total Liabilities & Equity		130,785,716			97,041,781			33,743,935			35%		47,956,772			82,828,944			173%

BEACH CITIES COMMERCIAL BANK
UNAUDITED STATEMENT OF OPERATIONS
		For the Three Months Ended																For the Twelve Months Ended				For the Twelve Months Ended
		December 31, 2024				September 30, 2024				June 30, 2024				March 31, 2024				December 31, 2024				December 31, 2023
Interest Income:
Interest and fees on loans		$	1,634,021			$	1,414,644			$	1,039,820			$	603,552			$	4,692,037			$	336,181
Interest on debt securities			13,814				13,981				13,216				13,043				54,054				17,320
Interest on federal funds sold and other interest-bearing deposits			213,719				179,138				220,164				246,997				860,018				821,283
Total Interest Income			1,861,554				1,607,763				1,273,200				863,592				5,606,109				1,174,784
Interest Expense:
Interest on Deposits			847,141				716,112				557,882				283,838				2,404,973				348,700
Interest on Borrowings			12,941				-				-				-				12,941				-
Total Interest Expense			860,082				716,112				557,882				283,838				2,417,914				348,700
Net Interest Income			1,001,472				891,651				715,318				579,754				3,188,195				826,084
Provisions for Credit Losses			385,000				117,000				180,000				245,000				927,000				317,000
Net interest income after provisions for loan losses			616,472				774,651				535,318				334,754				2,261,195				509,084
Non-interest income:
Service charges, fees and other			3,036				6,362				4,117				5,147				18,662				1,706
Gain on sale of loans			127,399				-				-				-				127,399				-
Non-Interest expense:
Salaries and employee benefits			1,134,175				1,106,821				1,135,056				1,105,393				4,481,445				2,318,336
Occupancy and Equipment expenses			170,923				174,256				175,312				171,013				691,504				408,909
Organization Expenses			-				-				-				-				-				1,045,800
Data Processing			139,545				185,053				175,117				128,315				628,030				332,424
Professional and Legal			59,734				101,407				171,546				111,763				444,450				469,110
Other Expenses			231,090				153,761				147,836				151,366				684,053				294,946
Total Non-interest expense			1,735,467				1,721,298				1,804,867				1,667,850				6,929,482				4,869,525
Income (Loss) before taxes			(988,560	)			(940,285	)			(1,265,432	)			(1,327,949	)			(4,522,226	)			(4,358,735	)
Income tax expense			-				-				800				800				1,600				800
Net Income (Loss)		$	(988,560	)		$	(940,285	)		$	(1,266,232	)		$	(1,328,749	)		$	(4,523,826	)		$	(4,359,535	)
Earnings per share ("EPS"): Basic		$	(0.39	)		$	(0.37	)		$	(0.50	)		$	(0.52	)		$	(1.77	)		$	(1.71	)
Common Shares Outstanding			2,565,864				2,556,112				2,556,112				2,556,112				2,565,864				2,556,112

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20250205919690/en/

H. Kent Falk, CEO

kent@beachcitiescb.com

949.704.0120

Jeffrey Redeker, President

jeff@beachcitiescb.com

949.704.2080

Najam Saiduddin, CFO/EVP

najam@beachcitiescb.com

949.704.2275

Source: Beach Cities Commercial Bank

FAQ

What was Beach Cities Commercial Bank's (BCCB) total asset growth in 2024?

BCCB's total assets grew by $83.0 million (173%) to reach $130.8 million as of December 31, 2024.

How much did BCCB's loan portfolio grow in Q4 2024?

BCCB's loan portfolio grew by $27.5 million during Q4 2024, contributing to a total year-over-year growth of 378%.

What was BCCB's net loss for the full year 2024?

BCCB reported a net loss of $4.52 million for the full year 2024.

What is BCCB's current loan portfolio yield and net interest margin?

As of December 31, 2024, BCCB's loan portfolio yield was 8.05% with a net interest margin of 4.21%.

How much liquidity does BCCB maintain as of Q4 2024?

BCCB maintains liquidity of $22.1 million, representing 16.9% of total assets, plus contingent borrowing sources of $33.2 million.