CBB Bancorp, Inc. Reports Third Quarter 2024 Financial Results

Rhea-AI Summary

CBB Bancorp reported net income of $5.6 million ($0.53 per diluted share) for Q3 2024, up from $5.5 million ($0.51 per diluted share) in Q2 2024. Net interest income was $15.5 million, a 0.7% increase quarter-over-quarter but 14.1% lower than Q3 2023. The net interest margin decreased to 3.71% from 3.77% in Q2. Total deposits reached $1.45 billion, up 8.0% from Q2 but down 6.6% year-over-year. The bank's efficiency ratio was 56.61%, and return on average assets remained stable at 1.31%.

Positive

• Net income increased to $5.6 million in Q3 2024 from $5.5 million in Q2 2024
• Total deposits grew by 8.0% quarter-over-quarter to $1.45 billion
• Strong capital position with Common Equity Tier1 Risk-Based Capital Ratio at 19.03%
• Solid loan sale performance with $20.2 million in SBA loans sold at 7.5% premium

Negative

• Net interest income decreased 14.1% year-over-year
• Net interest margin declined to 3.71% from 3.77% in previous quarter
• Nonperforming assets increased to $8.6 million from $5.8 million in Q2 2024
• Efficiency ratio worsened to 56.61% from 55.69% in Q2 2024

LOS ANGELES--(BUSINESS WIRE)-- CBB Bancorp, Inc. ("CBB" or the "Company') (OTCQX: CBBI), the holding company of Commonwealth Business Bank, doing business as “CBB Bank” (the "Bank"), announced today net income of $5.6 million for the third quarter 2024, or $0.53 per diluted share compared to $5.5 million in the second quarter 2024, or $0.51 per diluted share.

OVERALL RESULTS

Net income for the third quarter 2024 increased due to higher net interest income after provision for credit losses offset by lower noninterest income and higher noninterest expenses.

The return on average assets for the third quarter 2024 was 1.31% compared to 1.31% for the second quarter 2024 and 1.46% for the third quarter 2023. The return on average equity for the third quarter 2024 was 8.91% compared to 9.06% for the second quarter 2024 and 11.66% for the third quarter 2023.

The efficiency ratio for the third quarter 2024 was 56.61% compared to 55.69% for the second quarter 2024 and 52.23% for the third quarter 2023.

James Hong, President and CEO, said, "I am pleased to report that we have delivered another strong quarter, reflecting our unwavering commitment to serving our customers and communities. Our third quarter results demonstrate the resilience and dedication of our entire team. During the quarter, we saw a solid increase in both deposits and loan originations, underscoring the trust our customers place in us. Our strategic initiatives to enhance digital banking services have been met with increased adoption. We continue to prioritize financial health and stability, ensuring that our bank remains a safe and reliable partner for all our stakeholders."

INCOME STATEMENT

Net Interest Income

Net interest income for the third quarter 2024 was $15.5 million, an increase of $112 thousand, or 0.7%, quarter over quarter, but a decrease of $2.5 million, or 14.1% compared to the third quarter 2023.

Net interest income for the nine months ended on September 30, 2024 was $46.6 million, a decrease of $9.2 million or 16.4% compared to the same period last year. The decrease in net interest income was due to periodic sales of SBA loans and higher cost of interest-bearing deposits as maturing time deposits were rolled over into higher interest rate CDs.

Net Interest Margin

The net interest margin for the third quarter 2024 was 3.71% compared to 3.77% in the prior quarter. The decrease in the net interest margin compared to the second quarter was due to higher cost of funds. The cost of funds for the third quarter 2024 increased eight basis points to 3.60% compared to 3.52% in the second quarter and sixty-nine basis points from 2.91% in the third quarter 2023.

Provision for Credit Losses

Provision for credit losses was negative $100 thousand for the third quarter 2024 compared to $200 thousand in the second quarter 2024. No provision for credit losses was recorded in the second quarter 2023.

Noninterest Income

Noninterest income for the third quarter 2024 was $2.2 million compared to $2.3 million for the second quarter 2024, a decrease of $119 thousand, and an increase of $756 thousand compared to $1.5 million for the third quarter 2023.

Noninterest income for the nine months ended September 30, 2024 was $7.1 million, an increase of $1.8 million compared to the same period last year. The increase was due to a combination of higher gain on sale of loans and increased SBA servicing fee income and banking service fees.

Noninterest Expenses

Noninterest expenses for the third quarter 2024 were $10.0 million compared to $9.9 million for the second quarter 2024 and $10.2 million for the third quarter 2023. Noninterest expenses increased $160 thousand quarter over quarter on higher marketing and loan related expenses.

Noninterest expenses for the nine months ended on September 30, 2024 were $29.9 million, a decrease of $0.7 million or 2.3% compared to the same period last year.

Please refer to financial tables in this press release for additional information and trends.

Income Taxes

The Company’s effective tax rate for the third quarter 2024 was 28.4% compared to 28.3% for second quarter 2024 and 28.3% for third quarter 2023.

BALANCE SHEET

Investment Securities

Investment securities were $63.2 million at September 30, 2024, a decrease of $9.8 million or 13.5% from June 30, 2024, and an increase of $1.6 million or 2.6% from September 30, 2023.

Loans Receivable

Loans receivable (including loans held-for-sale) at September 30, 2024 was $1.42 billion, a decrease of $16.8 million or 1.2% from June 30, 2024 and increased $301 thousand from September 30, 2023.

Allowance for Credit Losses and Asset Quality

The Allowance for Credit Losses (“ACL”) at September 30, 2024, was $16.0 million which was 1.30% of loans held-for-investment compared to $16.0 million at June 30, 2024, or 1.31% of loans held-for-investment. At September 30, 2023, ACL was $15.3 million or 1.27% of total loans held-for-investment.

Total Nonperforming assets at September 30, 2024 were $8.6 million compared to $5.8 million at June 30, 2024 and $0.7 million at September 30, 2023. The ACL coverage to nonperforming assets was over 186% at September 30, 2024.

SBA Loans Held-for-Sale

Total SBA loans held-for-sale at September 30, 2024 was $198.0 million compared to $ 209.1 million June 30, 2024, and $219.4 million at September 30, 2023.

The Bank sold approximately $20.2 million in SBA loans with an average premium of 7.5% during the third quarter 2024 compared to the sale of $19.5 million with an average premium of 8.3% during the second quarter 2024. The Bank sold approximately $9.2 million of SBA loans with an average premium of 8.3% during the third quarter 2023.

Deposits

Total deposits were $1.45 billion at September 30, 2024, up $107.2 million or 8.0% from June 30, 2024, and down $101.7 million or 6.6% from September 30, 2023.

Borrowings

The Bank maintains $50.0 million in Federal Home Loan Bank advances and there was no change from the previous quarter.

Capital

Stockholders’ equity was $250.5 million at September 30, 2024, which increased $5.3 million or 2.2%, quarter over quarter. Tangible book value per share at September 30, 2024 was $23.44, an increase of $0.50, or 2.2%, quarter over quarter.

Each of the Company’s and the Bank’s regulatory capital ratios compared to June 30, 2023. The Bank is considered “Well Capitalized” under the applicable regulatory capital rules.

The Common Equity Tier1 Risk-Based Capital Ratios at September 30, 2024, were 19.03% and 18.95% for the Company and the Bank, respectively. Total Risk-Based Capital Ratios were 20.26% and 20.18% for the Company and the Bank, respectively. Bank’s Leverage Ratios were 14.64% and 14.58% for the Company and the Bank, respectively.

About CBB Bancorp, Inc.:

CBB Bancorp, Inc. is the holding company of Commonwealth Business Bank, a full-service commercial bank which specializes in loans to small-to-medium-sized businesses and does business as “CBB Bank.” As of September 30, 2024, the Bank had eleven full-service banking offices in Los Angeles and Orange Counties in California, Dallas County in Texas and Honolulu, Hawaii. Two SBA regional offices in Los Angeles and Dallas Counties; and loan production offices in Georgia and Washington. For additional information, please go to www.cbb-bank.com under the tab “About Us” and select “Investor Relations” to see the 3Q 2024 Overview.

FORWARD-LOOKING STATEMENTS:

This press release includes 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. CBB Bancorp, Inc. (the “Company”) intends that such forward-looking statements be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Future events are difficult to predict, and the expectations described herein are necessarily subject to risks and uncertainties that may cause actual results to differ materially and adversely from those described herein. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.” These forward-looking statements are not guarantees of future performance, nor should they be relied upon as representing management’s views as of any subsequent date. Factors that might cause actual results to differ materially from those presented, either expressed or implied, in this news release include, but are not limited to: the Company’s ability to successfully execute its business plans and achieve its objectives; changes in general economic and financial market conditions, either nationally or locally in areas in which the Company conducts its operations; changes in interest rates; continuing consolidation in the financial services industry; new litigation or changes in existing litigation; increased competitive challenges and expanding product and pricing pressures among financial institutions; legislation or regulatory changes which adversely affect the Company’s operations or business; loss of key personnel; and changes in accounting policies or procedures as may be required by the Financial Accounting Standards Board or other regulatory agencies.

The Company undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances, except to the extent required by law.

Schedules and Financial Data: All tables and data to follow

STATEMENT OF INCOME AND PERFORMANCE HIGHLIGHT (Unaudited) - Table 1
(Dollars in thousands, except per share amounts)
	Three Months Ended																								Nine Months Ended
	September 30,				June 30,				$			%			September 30,				$			%			September 30,				September 30,				$			%
		2024				2024			Change			Change				2023			Change			Change				2024				2023			Change			Change
Interest income	$	28,380			$	27,755			$	625		2.3	%		$	29,450			$	(1,070	)	(3.6	%)		$	84,598			$	85,362			$	(764	)	(0.9	%)
Interest expense		12,904				12,391				513		4.1	%			11,442				1,462		12.8	%			37,950				29,540				8,410		28.5	%
Net interest income		15,476				15,364				112		0.7	%			18,008				(2,532	)	(14.1	%)			46,648				55,822				(9,174	)	(16.4	%)
Provision for credit losses		(100	)			200				(300	)	(150.0	%)			-				(100	)	100.0	%			500				-				500		100.0	%
Net interest income after provision for credit losses		15,576				15,164				412		2.7	%			18,008				(2,432	)	(13.5	%)			46,148				55,822				(9,674	)	(17.3	%)
Gain on sale of loans		991				1,064				(73	)	-6.9	%			419				572		26.7	%			3,544				2,371				1,173		49.5	%
Gain (loss) on sale of OREO		-				-				-		-				-				-		-				-				-				-		-
SBA servicing fee income, net		760				768				(8	)	(1.0	%)			639				121		18.9	%			2,161				1,733				428		24.7	%
Recovery on impaired servicing liability		-				-				-		-				-				-		-				10				-				10		100.0	%
Service charges and other income		465				503				(38	)	(7.6	%)			402				63		15.7	%			1,397				1,207				190		15.7	%
Noninterest income		2,216				2,335				(119	)	(5.1	%)			1,460				756		51.8	%			7,112				5,311				1,801		33.9	%
Salaries and employee benefits		5,884				5,927				(43	)	(0.7	%)			5,569				315		5.7	%			17,835				17,229				606		3.5	%
Occupancy and equipment		1,149				1,114				35		3.1	%			1,103				46		4.2	%			3,385				3,349				36		1.1	%
Marketing expense		423				403				20		5.0	%			475				(52	)	(10.9	%)			1,228				1,258				(30	)	(2.4	%)
Professional expense		456				440				16		3.6	%			443				13		2.9	%			1,308				1,333				(25	)	(1.9	%)
Other expenses		2,104				1,972				132		6.7	%			2,579				(475	)	(18.4	%)			6,160				7,458				(1,298	)	(17.4	%)
Noninterest expense		10,016				9,856				160		1.6	%			10,169				(153	)	(1.5	%)			29,916				30,627				(711	)	(2.3	%)
Income before income tax provision		7,776				7,643				133		1.7	%			9,299				(1,523	)	(16.4	%)			23,344				30,506				(7,162	)	(23.5	%)
Income tax provision		2,207				2,163				44		2.0	%			2,630				(423	)	(16.1	%)			6,623				8,645				(2,022	)	(23.4	%)
Net income	$	5,569			$	5,480			$	89		1.6	%		$	6,669			$	(1,100	)	(16.5	%)		$	16,721			$	21,861			$	(5,140	)	(23.5	%)
Effective tax rate		28.38	%			28.30	%			0.08	%	0.29	%			28.28	%			0.10	%	0.35	%			28.37	%			28.34	%			0.03	%	0.12	%
Outstanding number of shares		10,588,136				10,588,136				-		-				10,588,136				-		-				10,588,136				10,588,136				-		-
Weighted average shares for basic EPS		10,588,136				10,588,136				-		-				10,588,136				-		-				10,588,136				10,584,198				3,938		0.0	%
Weighted average shares for diluted EPS		10,596,039				10,588,136				7,903		0.1	%			10,594,155				1,884		0.0	%			10,592,363				10,595,275				(2,912	)	(0.0	%)
Basic EPS	$	0.53			$	0.51			$	0.02		3.9	%		$	0.63			$	(0.10	)	(15.9	%)		$	1.58			$	2.07			$	(0.49	)	-23.7	%
Diluted EPS	$	0.53			$	0.51			$	0.02		3.9	%		$	0.63			$	(0.10	)	(15.9	%)		$	1.58			$	2.06			$	(0.48	)	(23.3	%)
Return on average assets		1.31	%			1.31	%			0.00	%	0.0	%			1.46	%			(0.15	%)	(10.3	%)			1.32	%			1.61	%			(0.29	%)	(18.0	%)
Return on average equity		8.91	%			9.06	%			(0.15	%)	(1.7	%)			11.66	%			(2.75	%)	(23.6	%)			9.18	%			13.27	%			(4.09	%)	(30.8	%)
Efficiency ratio¹		56.61	%			55.69	%			0.92	%	1.7	%			52.23	%			4.38	%	8.4	%			55.65	%			50.10	%			5.55	%	11.1	%
Yield on interest-earning assets²		6.80	%			6.79	%			0.01	%	0.2	%			6.55	%			0.25	%	3.8	%			6.79	%			6.42	%			0.37	%	5.8	%
Cost of funds		3.60	%			3.52	%			0.08	%	2.3	%			2.91	%			0.69	%	23.7	%			3.53	%			2.51	%			1.02	%	40.6	%
Net interest margin²		3.71	%			3.77	%			(0.06	%)	(1.6	%)			4.01	%			(0.30	%)	(7.5	%)			3.75	%			4.20	%			(0.45	%)	(10.7	%)

1		Represents the ratio of noninterest expense less other real estate owned operations to the sum of net interest income before provision for credit losses and total noninterest income.
2		Amounts calculated on a fully taxable equivalent basis using the current statutory federal tax rate

BALANCE SHEET, CAPITAL AND OTHER DATA (Unaudited) - Table 2
(Dollars in thousands)
	September 30,				June 30,				$			%			September 30,				$			%
		2024				2024			Change			Change				2023			Change			Change
ASSETS
Cash and due from banks	$	14,892			$	11,667			$	3,225		27.6	%		$	11,188			$	3,704		33.1	%
Interest-earning deposits at the FRB and other banks		241,094				101,415				139,679		137.7	%			335,016				(93,922	)	(28.0	%)
Investment securities¹		63,208				73,051				(9,843	)	(13.5	%)			61,617				1,591		2.6	%
Loans held-for-sale		198,021				209,144				(11,123	)	(5.3	%)			219,355				(21,334	)	(9.7	%)
Loans held-for-investment		1,222,865				1,228,496				(5,631	)	(0.5	%)			1,201,230				21,635		1.8	%
Less: Allowance for credit losses ("ACL")		(15,948	)			(16,042	)			94		0.6	%			(15,284	)			(664	)	(4.3	%)
Loans held-for-investment, net		1,206,917				1,212,454				(5,537	)	(0.5	%)			1,185,946				20,971		1.8	%
Other real estate owned ("OREO")		521				-				521		100.0	%			55				466		847.3	%
Restricted stock investments		11,011				11,011				-		-				11,011				-		-
Servicing assets		7,192				7,404				(212	)	(2.9	%)			7,873				(681	)	(8.6	%)
Goodwill		2,185				2,185				-		-				2,185				-		-
Intangible assets		224				235				(11	)	(4.7	%)			267				(43	)	(16.1	%)
Other assets		25,284				26,343				(1,059	)	(4.0	%)			24,799				485		2.0	%
Total assets	$	1,770,549			$	1,654,909			$	115,640		7.0	%		$	1,859,312			$	(88,763	)	(4.8	%)
LIABILITIES AND STOCKHOLDERS' EQUITY
Noninterest-bearing	$	318,807			$	281,243			$	37,564		13.4	%		$	406,033			$	(87,226	)	(21.5	%)
Interest-bearing		1,128,784				1,059,146				69,638		6.6	%			1,143,257				(14,473	)	(1.3	%)
Total deposits		1,447,591				1,340,389				107,202		8.0	%			1,549,290				(101,699	)	(6.6	%)
FHLB advances and other borrowing		50,000				50,000				-		-				50,000				-		-
Other liabilities		22,415				19,260				3,155		16.4	%			31,141				(8,726	)	(28.0	%)
Total liabilities		1,520,006				1,409,649				110,357		7.8	%			1,630,431				(110,425	)	(6.8	%)
Stockholders' Equity		250,543				245,260				5,283		2.2	%			228,881				21,662		9.5	%
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY	$	1,770,549			$	1,654,909			$	115,640		7.0	%		$	1,859,312			$	(88,763	)	(4.8	%)
CAPITAL RATIOS
Leverage ratio
Company		14.64	%			14.51	%			0.12	%	0.9	%			12.53	%			2.11	%	16.8	%
Bank		14.58	%			14.45	%			0.13	%	0.9	%			12.50	%			2.08	%	16.6	%
Common equity tier 1 risk-based capital ratio
Company		19.03	%			18.36	%			0.67	%	3.6	%			17.61	%			1.41	%	8.0	%
Bank		18.95	%			18.28	%			0.67	%	3.7	%			17.58	%			1.37	%	7.8	%
Tier 1 risk-based capital ratio
Company		19.03	%			18.36	%			0.67	%	3.6	%			17.61	%			1.41	%	8.0	%
Bank		18.95	%			18.28	%			0.67	%	3.7	%			17.57	%			1.38	%	7.8	%
Total risk-based capital ratio
Company		20.26	%			19.59	%			0.67	%	3.4	%			18.83	%			1.43	%	7.6	%
Bank		20.18	%			19.50	%			0.68	%	3.5	%			18.79	%			1.39	%	7.4	%
Earning Assets		1,736,199				1,623,117				113,082		7.0	%			1,828,229			$	(92,030	)	(5.0	%)
Outstanding Number of Shares¹		10,588,136				10,588,136				-		0.0	%			10,588,136				-		0.0	%
Tangible Common Equity Ratio		14.03	%			14.70	%			(0.67	%)	(4.6	%)			12.19	%			1.84	%	15.1	%
Tangible book value per share	$	23.44			$	22.94			$	0.50		2.2	%		$	21.39			$	2.05		9.6	%
Loans Held for Investments-to-Deposit ("LHFITD") ratio		84.48	%			91.65	%			(7.17	%)	(7.8	%)			77.53	%			6.95	%	9.0	%
Net Loan-to-Deposit ("LTD") ratio		97.05	%			106.06	%			(9.01	%)	(8.5	%)			90.71	%			6.34	%	7.0	%
Nonperforming assets	$	8,558			$	5,797			$	2,761		47.6	%		$	673			$	7,885		1171.6	%
Nonperforming assets as a % of loans held-for-investment		0.70	%			0.47	%			0.23	%	48.9	%			0.06	%			0.64	%	1066.7	%
ACL as a % of loans held-for-investment		1.30	%			1.31	%			(0.01	%)	(0.76	%)			1.27	%			0.03	%	2.4	%

1

Includes AFS and HTM

FIVE-QUARTER STATEMENT OF INCOME (Unaudited) - Table 3 (Dollars in thousands, except per share amounts)
	Three Months Ended
	September 30,				June 30,				March 31,				December 31,				September 30,
		2024				2024				2024				2023				2023
Interest income	$	28,380			$	27,755			$	28,463			$	29,624			$	29,450
Interest expense		12,904				12,391				12,655				12,462				11,442
Net interest income		15,476				15,364				15,808				17,162				18,008
Provision for credit losses		(100	)			200				400				-				-
Net interest income after provision for credit losses		15,576				15,164				15,408				17,162				18,008
Gain on sale of loans		991				1,064				1,489				838				419
Gain (loss) on sale of OREO		-				-				(1	)			-				-
SBA servicing fee income, net		760				768				633				690				639
Recovery on impaired servicing liability		-				-				10				-				-
Service charges and other income		465				503				430				436				402
Noninterest income		2,216				2,335				2,561				1,964				1,460
Salaries and employee benefits		5,884				5,927				6,024				5,356				5,569
Occupancy and equipment		1,149				1,114				1,122				1,128				1,103
Marketing expense		423				403				402				250				475
Professional expense		456				440				412				360				443
Other expenses		2,104				1,972				2,084				2,363				2,579
Noninterest expense		10,016				9,856				10,044				9,457				10,169
Income before income tax expense		7,776				7,643				7,925				9,669				9,299
Income tax expense		2,207				2,163				2,253				2,670				2,630
Net income	$	5,569			$	5,480			$	5,672			$	6,999			$	6,669
Effective tax rate		28.4	%			28.3	%			28.4	%			27.6	%			28.3	%
Outstanding number of shares		10,588,136				10,588,136				10,588,136				10,588,136				10,588,136
Weighted average shares for basic EPS		10,588,136				10,588,136				10,588,136				10,588,136				10,588,136
Weighted average shares for diluted EPS		10,596,039				10,588,136				10,588,688				10,588,937				10,594,155
Basic EPS	$	0.53			$	0.51			$	0.54			$	0.66			$	0.63
Diluted EPS	$	0.53			$	0.51			$	0.54			$	0.66			$	0.63

FIVE-QUARTER SALARIES BENEFIT METRICS (Unaudited) - Table 4
(Dollars in thousands)
		At or for the Three Months Ended
		September 30,				June 30,				March 31,				December 31,				September 30,
			2024				2024				2023				2023				2023
Salaries and benefits		$	5,884			$	5,927			$	6,024			$	5,356			$	5,569
FTE at the end of period			178				172				168				169				172
Average FTE during the period			173				171				169				169				168
Salaries and benefits/average FTE¹		$	135			$	139			$	143			$	126			$	131
Salaries and benefits/average assets¹			1.38	%			1.42	%			1.41	%			1.18	%			1.22	%
Noninterest expense/average assets¹			2.35	%			2.36	%			2.35	%			2.08	%			2.22	%

1	Annualized

FIVE-QUARTER BALANCE SHEET (Unaudited) - Table 5
(Dollars in thousands)
	September 30,				June 30,				March 31,				December 31,				September 30,
		2024				2024				2024				2023				2023
ASSETS
Cash and due from banks	$	14,892			$	11,667			$	11,612			$	14,282			$	11,188
Interest-earning deposits at the FRB and other banks		241,094				101,415				181,366				233,255				335,016
Investment securities		63,208				73,051				59,143				59,883				61,617
Loans held-for-sale		198,021				209,144				198,167				218,258				219,355
Loans held-for-investment		1,222,865				1,228,496				1,194,439				1,204,009				1,201,230
Less: Allowance for credit losses		(15,948	)			(16,042	)			(16,048	)			(15,291	)			(15,284	)
Loans held-for-investment, net		1,206,917				1,212,454				1,178,391				1,188,718				1,185,946
Other real estate owned		521				-				-				55				55
Restricted stock investments		11,011				11,011				11,011				11,011				11,011
Servicing assets		7,192				7,404				7,560				7,673				7,873
Goodwill		2,185				2,185				2,185				2,185				2,185
Intangible assets		224				235				245				255				267
Other assets		25,284				26,343				23,581				24,838				24,799
Total assets	$	1,770,549			$	1,654,909			$	1,673,261			$	1,760,413			$	1,859,312
LIABILITIES AND STOCKHOLDERS' EQUITY
Noninterest-bearing	$	318,807			$	281,243			$	286,766			$	305,923			$	406,033
Interest-bearing		1,128,784				1,059,146				1,074,198				1,147,662				1,143,257
Total deposits		1,447,591				1,340,389				1,360,964				1,453,585				1,549,290
FHLB advances		50,000				50,000				50,000				50,000				50,000
Other liabilities		22,415				19,260				21,727				21,114				31,141
Total liabilities		1,520,006				1,409,649				1,432,691				1,524,699				1,630,431
Stockholders' Equity		250,543				245,260				240,570				235,714				228,881
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY	$	1,770,549			$	1,654,909			$	1,673,261			$	1,760,413			$	1,859,312

FIVE-QUARTER LOANS RECEIVABLE COMPONENTS (Unaudited) - Table 6
(Dollars in thousands)
	September 30, 2024						June 30, 2024						March 31, 2024						December 31, 2023						September 30, 2023
	Balance			%			Balance			%			Balance			%			Balance			%			Balance			%
Construction	$	29,789		2.4	%		$	33,918		2.8	%		$	37,216		3.1	%		$	34,886		2.9	%		$	30,924		2.6	%
Commercial real estate		1,029,768		84.2	%			1,035,425		84.3	%			1,005,765		84.2	%			1,010,495		83.9	%			1,005,735		83.7	%
Commercial and industrial		112,588		9.2	%			108,742		8.9	%			101,784		8.5	%			108,123		9.0	%			113,374		9.4	%
Home mortgage		45,673		3.7	%			44,987		3.7	%			44,389		3.7	%			44,920		3.7	%			45,452		3.8	%
Consumer		537		0.0	%			782		0.1	%			668		0.1	%			630		0.1	%			616		0.1	%
Gross loans held-for-investment		1,218,355		99.6	%			1,223,854		99.6	%			1,189,822		99.6	%			1,199,054		99.6	%			1,196,101		99.6	%
Deferred loan fees/costs, net		4,510		0.4	%			4,642		0.4	%			4,617		0.4	%			4,955		0.4	%			5,129		0.4	%
Loans held-for-investment	$	1,222,865		100.0	%		$	1,228,496		100.0	%		$	1,194,439		100.0	%		$	1,204,009		100.0	%		$	1,201,230		100.0	%
Loans held-for-sale	$	198,021					$	209,144					$	198,167					$	218,258					$	219,355
Total loans receivable	$	1,420,886					$	1,437,640					$	1,392,606					$	1,422,267					$	1,420,585

FIVE-QUARTER SBA LOAN PRODUCTIONS/SALES DATA (Unaudited) - Table 7
(Dollars in thousands)
	Three Months Ended																				Nine Months Ended
	September 30,				June 30,				March 31,				December 31,				September 30,				September 30,				September 30,
		2024				2024				2024				2023				2023				2024				2023
SBA loans held-for-sale at beginning of the quarter/year	$	209,144			$	198,167			$	218,258			$	219,355			$	215,083			$	218,258			$	230,431
SBA loans originated/transferred from/to held-for-investment during the quarter/year		13,169				34,366				14,589				27,022				16,260				62,124				51,423
SBA loans sold during the quarter/year		(20,152	)			(19,508	)			(28,164	)			(21,749	)			(9,245	)			(67,824	)			(51,682	)
SBA loans principal paydown/payoff, net of advance		(4,140	)			(3,881	)			(6,516	)			(6,370	)			(2,743	)			(14,537	)			(10,817	)
SBA loans held-for-sale at end of the quarter/year	$	198,021			$	209,144			$	198,167			$	218,258			$	219,355			$	198,021			$	219,355
Gain on sale of SBA loans	$	991			$	1,064			$	1,489			$	838			$	419			$	3,544			$	2,371
Premium on sale (weighted average)		7.5	%			8.3	%			6.8	%			6.7	%			8.3	%			8.1	%			7.1	%
SBA loan production	$	23,227			$	45,126			$	18,089			$	37,821			$	24,270			$	68,353			$	70,002

FIVE QUARTER SBA SERVICING ASSETS AND SERVICING FEES (Unaudited) - Table 8
(Dollars in thousands)
	Three Months Ended																				Nine Months Ended
	September 30,				June 30,				March 31,				December 31,				September 30,				September 30,				September 30,
		2024				2024				2023				2023				2023				2024				2023
SBA servicing assets @ beginning of the quarter/year	$	7,404			$	7,560			$	7,673			$	7,873			$	8,426			$	7,673			$	9,232
Newly added SBA servicing assets from SBA loans sold		377				395				555				430				182				1,327				988
Regular quarterly/annual servicing assets amortization		(332	)			(335	)			(332	)			(356	)			(371	)			(999	)			(1,153	)
SBA servicing assets amortized from SBA loans paid off/charged off		(257	)			(216	)			(336	)			(274	)			(364	)			(809	)			(1,194	)
Subtotal before impairment		7,192				7,404				7,560				7,673				7,873				7,192				7,873
Reversal of valuation allowance on servicing assets		-				-				-				-				-				-				-
SBA servicing assets @ the end of the quarter/year	$	7,192			$	7,404			$	7,560			$	7,673			$	7,873			$	7,192			$	7,873

FIVE-QUARTER DEPOSIT COMPONENTS (Unaudited) - Table 9
(Dollars in thousands)
	September 30, 2024						June 30, 2024						March 31, 2024						December 31, 2023						September 30, 2023
	Balance			%			Balance			%			Balance			%			Balance			%			Balance			%
Noninterest-bearing demand	$	318,807		22.0	%		$	281,243		21.0	%		$	286,766		21.1	%		$	305,923		21.1	%		$	406,033		26.2	%
Interest-bearing demand		6,590		0.5	%			7,901		0.6	%			6,709		0.5	%			7,504		0.5	%			6,395		0.4	%
NOW & MMDA		246,157		17.0	%			240,951		18.0	%			229,642		16.9	%			237,548		16.3	%			227,283		14.7	%
Savings		78,356		5.4	%			80,360		6.0	%			84,999		6.2	%			88,689		6.1	%			78,969		5.1	%
TCDs of $250K and under		310,134		21.4	%			295,109		22.0	%			299,944		22.0	%			315,920		21.7	%			312,704		20.2	%
TCDs of $250K over		342,301		23.7	%			314,119		23.4	%			339,482		25.0	%			353,866		24.4	%			373,345		24.1	%
Wholesale deposits		145,246		10.0	%			120,706		9.0	%			113,422		8.3	%			144,135		9.9	%			144,561		9.3	%
Total Deposits	$	1,447,591		100.0	%		$	1,340,389		100.0	%		$	1,360,964		100.0	%		$	1,453,585		100.0	%		$	1,549,290		100.0	%
Recap:
Noninterest-bearing demand	$	318,807		22.0	%		$	281,243		21.0	%		$	286,766		21.1	%		$	305,923		21.0	%		$	406,033		26.2	%
Interest-bearing demand		6,590		0.5	%			7,901		0.6	%			6,709		0.5	%			7,504		0.5	%			6,395		0.4	%
NOW & MMDA		222,545		15.4	%			217,339		16.2	%			229,642		16.9	%			237,548		16.3	%			227,283		14.7	%
Savings		78,356		5.4	%			80,360		6.0	%			84,999		6.2	%			88,689		6.1	%			78,969		5.1	%
TCDs of $250K and under		310,134		21.4	%			295,109		22.0	%			299,944		22.0	%			315,920		21.7	%			312,704		20.2	%
Core Deposits		936,432		64.7	%			881,952		65.8	%			908,060		66.7	%			955,584		65.7	%			1,031,384		66.6	%
TCDs of $250K over		342,301		23.6	%			314,119		23.4	%			339,482		24.9	%			353,866		24.3	%			373,345		24.1	%
ICS MMDA		23,612		1.6	%			23,612		1.8	%
Wholesale deposits		145,246		10.0	%			120,706		9.0	%			113,422		8.3	%			144,135		9.9	%			144,561		9.3	%
Noncore Deposits		511,159		35.3	%			458,437		34.2	%			452,904		33.3	%			498,001		34.3	%			517,906		33.4	%
Total Deposits	$	1,447,591		100.0	%		$	1,340,389		100.0	%		$	1,360,964		100.0	%		$	1,453,585		100.0	%		$	1,549,290		100.0	%

FIVE-QUARTER SELECTED LOAN AND ASSET QUALITY HIGHLIGHTS (Unaudited) - Table 10
(Dollars in thousands)
		3rd Qtr.				2nd Qtr.				1st Qtr.				4th Qtr.				3rd Qtr.
			2024				2024				2024				2023				2023
Allowance for Credit Losses
Balance at beginning of period		$	16,042			$	16,048			$	15,291			$	15,284			$	15,626
CECL transition provision											-				-				-
Provision for credit losses			-				200				743				-				-
Charge-offs			(108	)			(257	)							(2	)			(350	)
Recoveries			14				51				14				9				8
Balance at the end of period		$	15,948			$	16,042			$	16,048			$	15,291			$	15,284
Nonperforming Assets:¹
Over 90 days still accruing		$	994			$	-			$	1,605			$	399			$	2
Nonaccrual loans			7,043				5,797				2,842				2,030				616
Total nonperforming loans			8,037				5,797				4,447				2,429				618
Other real estate owned		$	521				-				-				55				55
Total nonperforming assets		$	8,558			$	5,797			$	4,447			$	2,484			$	673
Classified Assets:¹
Substandard		$	15,980			$	12,762			$	11,912			$	11,063			$	10,105
Doubtful			-				-				-				-				-
Loss
Total classified loans		$	15,980			$	12,762			$	11,912			$	11,063			$	10,105
Other real estate owned		$	521				-				-				55				55
Total classified assets		$	16,501			$	12,762			$	11,912			$	11,118			$	10,160
Performing modified loans:¹		$	452			$	464			$	3,811			$	3,336			$	3,336
Delinquent Loans:¹
Loans 30-89 days past due		$	4,308			$	8,613			$	16,907			$	5,981			$	10,620
90 days or more past due and still accruing			994				-				1,605				399				2
Nonaccrual			7,043				5,797				2,842				2,030				616
Total delinquent loans		$	12,345			$	14,410			$	21,354			$	8,410			$	11,238
Asset Quality Ratios:
Net (recoveries) charge-offs to average loans²			0.03	%			0.06	%			0.00	%			0.00	%			0.10	%
Nonaccrual loans to loans held-for-investment			0.58	%			0.47	%			0.24	%			0.17	%			0.05	%
Nonperforming loans to loans held-for-investment			0.66	%			0.47	%			0.37	%			0.20	%			0.05	%
Nonperforming assets to total assets			0.48	%			0.35	%			0.27	%			0.14	%			0.04	%
Classified loans to loans held-for-investment			1.31	%			1.04	%			1.00	%			0.92	%			0.84	%
Classified loans to Tier 1 and ACL			6.05	%			4.93	%			4.69	%			4.45	%			4.18	%
Classified assets to total assets			0.93	%			0.77	%			0.71	%			0.63	%			0.55	%
Classified assets to Tier 1 and ACL			6.25	%			4.93	%			4.69	%			4.47	%			4.20	%
ACL to loans held-for-investment			1.30	%			1.31	%			1.34	%			1.27	%			1.27	%
ACL to nonaccrual loans			226.44	%			276.73	%			564.67	%			753.25	%			2481.17	%
ACL to nonperforming loans			198.43	%			276.73	%			360.87	%			629.52	%			2473.14	%
ACL to nonperforming assets			186.35	%			276.73	%			360.87	%			615.58	%			2271.03	%
Texas ratio ³			3.24	%			2.24	%			1.75	%			1.00	%			0.28	%

1		Net of SBA guaranteed balance
2		Includes loans held-for-sale
3		Nonperforming assets divided by tangible common equity and ACL

FIVE-QUARTER CAPITAL RATIOS (Unaudited) - Table 11
		Well Capitalized			Adequately Capitalized			September 30,				June 30,				March 31,				December 31,				September 30,
		Regulatory			BASEL III
		Requirement			Fully Phased In				2024				2024				2024				2023				2023
Leverage ratio
Company		N/A			N/A				14.64	%			14.51	%			13.85	%			12.98	%			12.53	%
Bank		5.00	%		4.00	%			14.58	%			14.45	%			13.84	%			12.96	%			12.50	%
Common equity tier 1 risk-based capital ratio
Company		N/A			N/A				19.03	%			18.36	%			18.67	%			18.08	%			17.61	%
Bank		6.50	%		7.00	%			18.95	%			18.28	%			18.65	%			18.05	%			17.58	%
Tier 1 risk-based capital ratio
Company		N/A			N/A				19.03	%			18.36	%			18.67	%			18.08	%			17.61	%
Bank		8.00	%		8.50	%			18.95	%			18.28	%			18.65	%			18.05	%			17.57	%
Total risk-based capital ratio
Company		N/A			N/A				20.26	%			19.59	%			19.92	%			19.30	%			18.83	%
Bank		10.00	%		10.50	%			20.18	%			19.50	%			19.91	%			19.27	%			18.79	%
Tangible common equity/total assets									14.03	%			14.70	%			14.25	%			13.27	%			12.19	%
Tangible common equity per share								$	23.44			$	22.94			$	22.49			$	22.03			$	21.39

FIVE-QUARTER MARGIN ANALYSIS (Unaudited) -Table 12
(Dollars in thousands)
	Three Months Ended
	September 30, 2024									June 30, 2024									March 31, 2024									December 31, 2023									September 30, 2023
	Avg Balance			Interest			Yield			Avg Balance			Interest			Yield			Avg Balance			Interest			Yield			Avg Balance			Interest			Yield			Avg Balance			Interest			Yield
Number of Days in the Period																												Checked
INTEREST-EARNING ASSETS
Loans Receivable¹	$	1,427,123		$	25,357		7.07	%		$	1,418,458		$	24,887		7.06	%		$	1,415,924		$	24,906		7.07	%		$	1,410,971		$	24,926		7.01	%		$	1,417,148		$	24,734		6.92	%
Investment securities ²		68,198			734		4.28	%			70,052			723		4.15	%			59,554			575		3.88	%			60,094			563		3.72	%			64,587			577		3.54	%
Interest-earning deposits at the FRB and other banks		158,127			2,139		5.38	%			146,956			1,995		5.46	%			207,155			2,817		5.47	%			288,769			3,973		5.46	%			293,081			3,994		5.41	%
Other earning assets		11,011			200		7.23	%			11,011			200		7.31	%			11,011			214		7.82	%			11,011			212		7.64	%			11,011			196		7.06	%
Total interest-earning assets ²		1,664,459			28,430		6.80	%			1,646,477			27,805		6.79	%			1,693,644			28,512		6.77	%			1,770,845			29,674		6.65	%			1,785,827			29,501		6.55	%
NONINTEREST-EARNING ASSETS
Cash and due from banks		12,527									12,907									12,172									12,567									13,045
Other noninterest-earning assets		34,395									33,263									31,967									32,985									33,331
Total noninterest-earning assets		46,922									46,170									44,139									45,552									46,376
Less: Allowance for credit losses		(16,024	)								(16,058	)								(15,322	)								(15,291	)								(15,622	)
TOTAL ASSETS	$	1,695,357								$	1,676,589								$	1,722,461								$	1,801,106								$	1,816,581
INTEREST-BEARING DEPOSITS
Interest-bearing demand	$	11,007		$	6		0.22	%		$	11,864		$	6		0.20	%		$	12,680		$	6		0.19	%		$	12,657		$	7		0.22	%		$	12,347		$	6		0.19	%
Money market		236,834			2,555		4.29	%			230,261			2,272		3.97	%			229,441			2,285		4.01	%			222,289			2,158		3.85	%			211,152			1,907		3.58	%
Savings		79,289			689		3.46	%			82,215			700		3.42	%			84,854			724		3.43	%			82,403			664		3.20	%			70,579			494		2.78	%
Time deposits		767,607			9,536		4.94	%			759,954			9,296		4.92	%			801,122			9,523		4.78	%			824,900			9,515		4.58	%			820,335			8,916		4.31	%
Total interest-bearing deposits		1,094,737			12,786		4.65	%			1,084,294			12,274		4.55	%			1,128,097			12,538		4.47	%			1,142,249			12,344		4.29	%			1,114,413			11,323		4.03	%
Borrowings		50,000			118		0.94	%			50,013			117		0.94	%			50,000			117		0.94	%			50,001			118		0.94	%			50,001			119		0.94	%
Total interest-bearing liabilities		1,144,737			12,904		4.48	%			1,134,307			12,391		4.39	%			1,178,097			12,655		4.32	%			1,192,250			12,462		4.15	%			1,164,414			11,442		3.90	%
Noninterest-bearing deposits		280,670									279,765									284,867									350,656									397,791
Other liabilities		21,376									19,287									21,112									25,602									27,519
Stockholders' equity		248,574									243,230									238,385									232,598									226,857
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY	$	1,695,357								$	1,676,589								$	1,722,461								$	1,801,106								$	1,816,581
Net interest income²				$	15,526								$	15,414								$	15,857								$	17,212								$	18,059
Net interest spread							2.32	%								2.40	%								2.45	%								2.50	%								2.65	%
Effect of noninterest-bearing sources							1.39	%								1.37	%								1.32	%								1.36	%								1.36	%
Net interest margin²							3.71	%								3.77	%								3.77	%								3.86	%								4.01	%
Cost of deposits	$	1,375,407		$	12,786		3.70	%		$	1,364,059		$	12,274		3.62	%		$	1,412,964		$	12,538		3.57	%		$	1,492,905		$	12,344		3.28	%		$	1,512,204		$	11,323		2.97	%
Cost of funds	$	1,425,407		$	12,904		3.60	%		$	1,414,072		$	12,391		3.52	%		$	1,462,964		$	12,655		3.48	%		$	1,542,906		$	12,462		3.20	%		$	1,562,205		$	11,442		2.91	%

1		Loan held-for-investment, plus loans held-for-sale
2		Amounts calculated on a fully taxable equivalent basis using the current statutory federal tax rate

FIVE-QUARTER COMPONENTS OF YIELD ON LOANS (Unaudited) - Table 13
(Dollars in thousands)
		Three Months Ended
		September 30, 2024							June 30, 2024							March 31, 2024							December 31, 2023							September 30, 2023
		Amount				Yield			Amount				Yield			Amount				Yield			Amount				Yield			Amount				Yield
Contractual yield		$	24,544			6.84	%		$	24,271			6.88	%		$	24,138			6.86	%		$	24,235			6.81	%		$	23,932			6.70	%
SBA discount accretion			806			0.23	%			736			0.21	%			926			0.26	%			845			0.24	%			921			0.25	%
Prepayment penalties and late fees			184			0.05	%			36			0.01	%			67			0.01	%			40			0.01	%			18			0.01	%
Amortization of net deferred costs			(177	)		-0.05	%			(156	)		-0.04	%			(225	)		-0.06	%			(194	)		-0.05	%			(137	)		-0.04	%
As reported yield on loans		$	25,357			7.07	%		$	24,887			7.06	%		$	24,906			7.07	%		$	24,926			7.01	%		$	24,734			6.92	%

MARGIN ANALYSIS (Unaudited) - Table 14
(Dollars in thousands)
	Six Months Ended
	September 30, 2024									September 30,2023
	Avg Balance			Interest			Yield			Avg Balance			Interest			Yield
Number of Days in the Period
INTEREST-EARNING ASSETS
Loans Receivable ¹	$	1,420,526		$	75,150		7.07	%		$	1,454,301		$	73,774		6.78	%
Investment securities ²		65,943			2,032		4.12	%			67,543			1,749		3.46	%
Interest-earning deposits at the FRB and other banks		170,700			6,951		5.44	%			247,712			9,468		5.11	%
Other earning assets		11,011			614		7.45	%			10,655			523		6.56	%
Total interest-earning assets ²		1,668,180			84,747		6.79	%			1,780,211			85,514		6.42	%
NONINTEREST-EARNING ASSETS
Cash and due from banks		12,535									13,362
Other noninterest-earning assets		32,885									34,634
Total noninterest-earning assets		45,420									47,996
Less: Allowance for credit losses		(15,802	)								(15,601	)
TOTAL ASSETS	$	1,697,798								$	1,812,606
INTEREST-BEARING DEPOSITS
Interest-bearing demand	$	11,848		$	18		0.20	%		$	14,943		$	22		0.20	%
Money market		232,195			7,112		4.09	%			211,887			4,789		3.02	%
Savings		82,109			2,113		3.44	%			63,369			983		2.07	%
Time deposits		776,196			28,355		4.88	%			818,953			23,394		3.82	%
Total interest-bearing deposits		1,102,348			37,598		4.56	%			1,109,152			29,188		3.52	%
Borrowings		50,004			352		0.94	%			50,000			352		0.94	%
Total interest-bearing liabilities		1,152,352			37,950		4.40	%			1,159,152			29,540		3.41	%
Noninterest-bearing deposits		281,763									411,370
Other liabilities		20,268									21,808
Stockholders' equity		243,415									220,276
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY	$	1,697,798								$	1,812,606
Net interest income²				$	46,797								$	55,974
Net interest spread							2.39	%								3.01	%
Effect of noninterest-bearing sources							1.36	%								1.19	%
Net interest margin²							3.75	%								4.20	%
Cost of deposits	$	1,384,111		$	37,598		3.63	%		$	1,520,522		$	29,188		2.57	%
Cost of funds	$	1,434,115		$	37,950		3.53	%		$	1,570,522		$	29,540		2.51	%

1		Loan held-for-investment, plus loans held-for-sale
2		Amounts calculated on a fully taxable equivalent basis using the current statutory federal tax rate

COMPONENTS OF YIELD ON LOANS (Unaudited) - Table 15
(Dollars in thousands)
		Nine Months Ended
		September 30, 2024							September 30, 2023
		Amount				Yield			Amount				Yield
Contractual yield		$	72,953			6.86	%		$	71,342			6.56	%
SBA discount accretion			2,468			0.23	%			2,982			0.27	%
Prepayment penalties and late fees			287			0.03	%			108			0.01	%
Amortization of net deferred costs			(558	)		-0.05	%			(658	)		-0.06	%
As reported yield on loans		$	75,150			7.07	%		$	73,774			6.78	%

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20241024124174/en/

Richard Koh, EVP & CFO

(323) 988-3037

RichardK@cbb-bank.com

Source: CBB Bancorp, Inc.

FAQ

What was CBB Bancorp's (CBBI) net income for Q3 2024?

CBB Bancorp reported net income of $5.6 million ($0.53 per diluted share) for Q3 2024.

How did CBBI's deposits change in Q3 2024?

Total deposits increased by $107.2 million or 8.0% to $1.45 billion compared to Q2 2024.

What was CBBI's net interest margin in Q3 2024?

The net interest margin was 3.71% in Q3 2024, down from 3.77% in Q2 2024.

How much in SBA loans did CBBI sell in Q3 2024?

The bank sold approximately $20.2 million in SBA loans with an average premium of 7.5% during Q3 2024.