CBOA Financial, Inc. Reports Consolidated Earnings of $1,061,000 in 4Q 2022

Rhea-AI Summary

CBOA Financial, Inc. (OTCMKTS:CBOF) reported a strong performance for the fourth quarter of 2022, with net income rising 5.6% to $1.06 million, contributing to a fiscal year increase of 19.8% to $3.46 million. Fully diluted earnings per share reached $0.33, a 17.9% increase year-over-year. The Bank funded $41 million in new loans in Q4, with net interest income growing 9.5%. Non-performing assets are at a historic low, comprising just 0.001% of total assets. Shareholders' equity increased to $29 million, backed by earnings and warrant exercises. However, total assets slightly decreased by 0.6% in Q4.

Positive

• Net income increased 5.6% to $1.06 million in Q4 2022.
• Fiscal year net income rose 19.8% to $3.46 million.
• Fully diluted EPS grew 17.9% to $0.33.
• New loans funded amounted to $41 million in Q4.
• Non-performing assets decreased to 0.001% of total assets.

Negative

• Total assets decreased by 0.6% in Q4 2022.

TUCSON, Ariz., Jan. 24, 2023 /PRNewswire/ -- CBOA Financial, Inc. (OTCMKTS:CBOF) (the "Company"), parent company of Commerce Bank of Arizona (the "Bank" or "CBAZ"), announced that consolidated net income for quarter ending December 31, 2022 increased 5.6% to $1.06 million, from $1.01 million in the third quarter of this year.

"2022 was a tremendous year for Commerce Bank of Arizona. The Bank achieved strong improvement in nearly every financial category. Our growth and earnings reflect the consistent and resilient performance of our highly talented lending team," stated Chris Webster, President and CEO. "Net Income increased to $3.46 million which was an increase of 19.8% over fiscal 2021. Fully diluted Earnings per Share was $0.33/share, a 17.9% increase during the year" Webster added. Webster went on to say, "While we are very pleased with our 2022 performance, we continue to closely monitor our local market environments and the impact of ongoing increases in inflation and interest rates. Although the Bank's non-performing assets to total assets ratio decreased to a historic low point of a single basis point, we remain vigilant on monitoring our customers' performance and their ability to absorb these challenging macro-economic influences."

Fourth Quarter 2022 Highlights

• $41 million in new loans funded during the quarter.
• Net Interest Income increased 9.5% compared to the third quarter.
• Net Income exceeded $1 million for the second consecutive quarter.

Operational Highlights
Net loan growth for the full year was $50.3 million, a 21.8% increase over 2021. The Bank's Net Interest Margin increased to 4.79% in the fourth quarter. Non-performing assets which includes Other Real Estate Owned (OREO) are $3 thousand or 0.001% of assets, down from $1.4 million or 0.41% of assets at prior year-end.

Balance Sheet
Total assets decreased by 0.6% to $370.3 million during the quarter ended December 31, 2022, and increased 7.4% compared to $344.6 million a year ago.

Gross loans increased $50.3 million year-over-year, ending the fourth quarter 2022 at $281 million. Total deposits remained at $306 million year-over-year.

The Allowance for Loan Losses totaled $3.7 million at December 2022, or 1.32% of loans, down from 1.46% the previous quarter due to loan growth.

Shareholders' equity increased to $29 million at December 31, 2022, from $26.5 million the preceding quarter due to earnings, proceeds of warrant exercises which were granted as part of the Company's 20147 capital raise, and an increase in unrealized gains on securities. At December 31, 2022, tangible book value was $2.84 per share compared to $2.71 per share at September 30, 2022 and $3.12 per share a year ago. The Bank's December 2022 Tier 1 Leverage ratio was 10.31%, compared to 9.87% at December 31, 2021.

Capital Management
Capital ratios exceeded regulatory guidelines for a well-capitalized institution under Basel III and Dodd Frank Wall Street Reform requirements at December 31, 2022 as well as during all other quarters of 2022. Capital ratios are presented below.

About the Company
Commerce Bank of Arizona, established in 2002 in Tucson, Arizona, is a full-service community bank that caters to small-to mid-sized businesses and real estate professionals. CBAZ offers commercial clients with a variety of services ranging from U.S. Small Business Administration (SBA) financing solutions, construction loans, and commercial real estate loans. CBOA Financial, Inc. is a single-bank holding company and parent of the Bank. The Company is traded over-the-counter as CBOF. For additional information, please visit: www.commercebankaz.com.

Forward-looking Statements
This press release may include forward-looking statements about CBOA Financial, Inc. or Commerce Bank of Arizona. These statements involve certain risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Such risks and uncertainties include, but are not limited to, the following factors: competition, fluctuations in interest rates, dependency on key individuals, loan defaults, geographical concentration, litigation and changes in federal laws, regulations and interpretations thereof. All forward-looking statements included in this press release are based on information available at the time of the release, and CBOA Financial, Inc. and Commerce Bank of Arizona assume no obligation to update any forward-looking statement.

Unaudited Consolidated Summary Financial Information
Dollars in thousands - Unaudited		For the quarter ended				Year to Date
		12/31/2022	9/30/2022	12/31/2021		12/31/2022	12/31/2021
Summary Income Data
Interest Income		4,705	4,134	3,453		15,755	14,125
Interest expense		368	174	131		830	829
Net Interest Income		4,337	3,960	3,322		14,925	13,296
Provision for (reduction in) loan losses		-	-	155		37	494
Non-interest income		156	106	124		802	352
Realized gains (losses) on sales of securities		-	-	-		-	2
Non-interest expense		3,062	2,709	2,377		11,017	9,781
Income (loss) before income taxes		1,431	1,357	914		4,673	3,375
Provision for income tax		370	352	366		1,210	515
Net Income		1,061	1,005	548		3,463	2,860
Per Share Data
Shares outstanding end-of-period		10,214	9,759	9,356		10,214	9,356
Earnings per common share ($'s)		0.10	0.10	0.06		0.34	0.31
Earnings per common share (Diluted) ($'s)		0.10	0.10	0.05		0.33	0.28
Cash dividend declared		-	-	-		-	-
Total shareholders' equity		29,012	26,461	29,197		29,012	29,197
Tangible Book value per share ($'s)		2.84	2.71	3.12		2.84	3.12
Selected Bank Balance Sheet Data
Total assets		370,251	372,386	344,630		370,251	344,630
Securities available-for-sale		66,766	62,317	54,599		66,766	54,599
Loans		281,020	254,458	230,700		281,020	230,700
Allowance for loan losses		3,716	3,703	3,320		3,716	3,320
Deposits		306,287	337,631	305,694		306,287	305,694
Other borrowings		26,050	-	-		26,050	-
Shareholders' equity		29,012	26,461	29,197		29,012	29,197
Performance Ratios (%)
Return on avg shareholders' equity		15.35	15.09	7.56		11.59	9.87
Net interest margin (Bank)		4.79	4.34	4.02		4.32	3.99
Efficiency ratio (Bank)		68.15	66.63	69.07		70.05	70.57
Asset Quality Data (%)
Nonperforming assets to total assets		0.01	0.05	0.39		0.01	0.39
Reserve for loan losses to total loans		1.32	1.46	1.44		1.32	1.44
Net Charge-offs to avg loans for period		-	-	(0.01)		(0.00)	0.05
Regulatory Capital Ratios (%) (Bank)
Common Equity Tier 1		11.58	11.57	12.62		11.58	12.62
Tier 1 risk-based capital ratio		11.58	11.57	12.62		11.58	12.62
Total risk-based capital ratio		12.67	12.82	13.87		12.67	13.87
Tier 1 leverage capital ratio		10.31	9.40	9.87		10.31	9.87

 

Contact:
Chris Webster
President & CEO
480-253-4511
cwebster@commercebankaz.com

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SOURCE Commerce Bank of Arizona

FAQ

What was CBOA Financial's net income for Q4 2022?

CBOA Financial's net income for Q4 2022 was $1.06 million, a 5.6% increase from the previous quarter.

How much did CBOA Financial earn in 2022?

CBOA Financial reported a net income of $3.46 million for the fiscal year 2022, marking a 19.8% increase over 2021.

What was CBOA Financial's EPS for 2022?

The fully diluted earnings per share (EPS) for CBOA Financial in 2022 was $0.33, reflecting a 17.9% increase.

How did CBOA Financial's loan growth perform in 2022?

CBOA Financial achieved a net loan growth of $50.3 million in 2022, a 21.8% increase over the previous year.

What is the status of CBOA Financial's non-performing assets?

As of December 2022, CBOA Financial's non-performing assets decreased to just 0.001% of total assets.