Cornerstone Community Bancorp Reports Financial Results For the First Quarter Ended March 31, 2023

Rhea-AI Summary

Cornerstone Community Bancorp (OTC Pink: CRSB) reported a net income of $1,695,000 for Q1 2023, slightly up from $1,675,000 the previous year. Diluted earnings per share increased to $1.11, up from $1.09. The return on average assets was 1.13% and return on average equity reached 19.20%. The bank's net interest income rose to $5,180,000 compared to $4,350,000 last year, alongside an increase in total loans to $431.5 million.

Cornerstone also saw deposit growth, with total deposits at $565.7 million. Credit losses increased to $110,000 from $18,000, with nonperforming assets at $233,000. Shareholders’ equity grew to $36.4 million, and the book value per share rose to $24.57.

Positive

• Net income grew to $1,695,000, up from $1,675,000 year-over-year.
• Diluted EPS increased to $1.11 from $1.09.
• Net interest income increased to $5,180,000 compared to $4,350,000 last year.
• Total loans rose to $431.5 million from $375.4 million.
• Total deposits increased to $565.7 million from $532.3 million.
• Shareholders' equity increased to $36.4 million from $33.7 million.
• Book value per share rose to $24.57 from $22.93.

Negative

• Provision for credit losses on loans increased to $110,000 from $18,000.
• Nonperforming assets totaled $233,000, compared to none last year.

RED BLUFF, Calif.--(BUSINESS WIRE)-- Cornerstone Community Bancorp (OTC Pink: CRSB) announced today its financial results for the first quarter ended March 31, 2023.

The Company reported net income of $1,695,000 for the three months ended March 31, 2023 compared to net income of $1,675,000 for the same period last year. Diluted earnings per share were $1.11 for the three months ended March 31, 2023 compared to $1.09 for the same period last year.

The return on average assets for the three months ended March 31, 2023 was 1.13% and the return on average equity was 19.20%. The tax-equivalent net interest margin was 3.65% for the three months ended March 31, 2023 compared to 3.17% for the same period last year.

President and CEO, Matt Moseley, stated, “Cornerstone Community Bank continues to be a well performing bank due to our strong team and loyal customer base. While elevated levels of deposits have exited banks nation-wide, Cornerstone experienced deposit growth in the 1^st quarter compared to both year-end 2022 and 1^st quarter of 2022. The bank has a well-positioned liquidity profile with a diversified deposit base. Our estimated level of uninsured deposits at March 31, 2023 was 37% and the bank maintains both on and off balance sheet liquidity of $283 million. We have and will continue to focus on our core business practices. We are confident that our business model and our presence in the communities we serve will continue to deliver positive results to our shareholders and customers alike.”

Net Interest Income

Net interest income increased to $5,180,000 for the quarter ended March 31, 2023 compared to $4,350,000 for the same quarter last year.

Provision for credit losses on loans

The Company recorded a $110,000 provision for credit losses on loans during the three months ended March 31, 2023 compared to $18,000 for the same period last year.

Non-Interest Income

Non-interest income for the quarter ended March 31, 2023 was $310,000 compared to $264,000 for the quarter ended March 31, 2022.

Non-Interest Expense

Non-interest expense was $3,024,000 for the quarter ended March 31, 2023 compared to $2,243,000 for the same period last year.

Balance Sheet

Total loans, net of unearned income, at March 31, 2023 were $431.5 million compared to $375.4 million at March 31, 2022.

Total deposits were $565.7 million at March 31, 2023 compared to total deposits of $532.3 million at March 31, 2022.

Credit Quality

The allowance for credit losses on loans was $5,397,000, or 1.25% of loans, net of unearned income, at March 31, 2023, compared to $5,077,000, or 1.35% of loans, net of unearned income, at March 31, 2022. Nonperforming assets totaled $233,000 at March 31, 2023. There were no nonperforming assets at March 31, 2022.

Adoption of CECL

The Company adopted the current expected credit loss ("CECL") accounting standard on January 1, 2023. Upon adoption of the CECL standard, the Company increased the allowance for credit losses on loans by $127,549 and reduced the allowance for credit losses on unfunded loan commitments by $90,366. The Company adopted this standard using a modified retrospective approach through a cumulative-effect adjustment to retained earnings of $26,191.

Capital

At March 31, 2023, shareholders’ equity totaled $36.4 million compared to $33.7 million at March 31, 2022. At March 31, 2023, the Company's book value per common share was $24.57 compared to $22.93 at March 31, 2022.

At March 31, 2023, the Bank’s estimated total risk-based capital ratio was 12.95% and its tier 1 capital to risk weighted assets ratio was 11.84%. The Bank remains well capitalized under the regulatory framework for prompt corrective action.

About Cornerstone Community Bancorp

Cornerstone Community Bancorp, a bank holding company headquartered in Red Bluff, California, serves the Red Bluff, Redding and Anderson communities through its wholly-owned subsidiary, Cornerstone Community Bank with a headquarters office in Red Bluff, two banking offices in Redding and one in Anderson. The Bank provides commercial banking services to small and mid-size businesses, including professional service firms, real estate developers and investors and not-for-profit organizations and to their owners and other individuals. Additional information about the Bank is available on its website at www.bankcornerstone.com

Forward-Looking Statements

This release may contain certain forward-looking statements that are based on management's current expectations regarding economic, legislative, and regulatory issues that may impact Cornerstone Community Bancorp's earnings in future periods. 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,” “intend,” “estimate” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could” or “may.” Factors that could cause future results to vary materially from current management expectations include, but are not limited to, natural disasters (such as wildfires and earthquakes), pandemics such as COVID-19 and the economic impact caused directly by the disease and by government responses thereto, general economic conditions, economic uncertainty in the United States and abroad, changes in interest rates, deposit flows, real estate values, costs or effects of acquisitions, competition, changes in accounting principles, policies or guidelines, legislation or regulation (including the Coronavirus Aid, Relief and Economic Security Act of 2022), interruptions of utility service in our markets for sustained periods, and other economic, competitive, governmental, regulatory and technological factors (including external fraud and cybersecurity threats) affecting Cornerstone Community Bancorp's operations, pricing, products and services. Forward-looking statements speak only as of the date they are made. Except as required by law, Cornerstone Community Bancorp does not undertake to update forward-looking statements to reflect subsequent circumstances or events.

CORNERSTONE COMMUNITY BANCORP
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(Dollars in Thousands)
	03/31/23			12/31/22			09/30/22			06/30/22			03/31/22
ASSETS
Cash and due from banks	$	7,365		$	5,628		$	6,011		$	5,230		$	4,175
Federal funds sold		124			123			122			121			121
Interest-bearing deposits		44,706			25,212			57,618			48,277			73,629
Investment securities		95,139			94,435			95,511			102,692			99,748
Loans held for sale		-			-			-			-			-
Loans, net of unearned income		431,475			420,415			400,480			399,156			375,369
Allowance for credit losses on loans		(5,397	)		(5,159	)		(5,172	)		(5,132	)		(5,077	)
Loans, net		426,079			415,256			395,308			394,024			370,292
Premises and equipment, net		14,492			14,601			14,671			14,691			14,757
Other assets		28,906			27,326			21,261			20,588			16,930
Total assets	$	616,812		$	582,581		$	590,502		$	585,623		$	579,652
LIABILITIES
Deposits:
Demand noninterest-bearing	$	125,008		$	126,946		$	129,236		$	130,249		$	131,136
Demand interest-bearing		165,203			136,655			138,630			131,623			126,331
Money market and savings		180,996			182,787			201,316			201,106			196,653
Time deposits		94,542			88,430			76,121			76,576			78,167
Total deposits		565,749			534,818			545,303			539,554			532,287
Borrowings and other obligations		-			-			-			-			-
Subordinated debentures		11,750			11,744			11,738			11,732			11,726
Interest payable and other liabilities		2,954			2,755			2,892			2,631			1,899
Total liabilities		580,452			549,317			559,933			553,917			545,912
SHAREHOLDERS' EQUITY
Common stock		15,113			15,075			14,964			15,079			15,009
Retained Earnings		31,963			30,294			28,368			26,432			24,726
Accumulated other comprehensive income (loss)		(10,716	)		(12,105	)		(12,763	)		(9,805	)		(5,995	)
Total shareholders' equity		36,360			33,264			30,569			31,706			33,740
Total liabilities and shareholders' equity	$	616,812		$	582,581		$	590,502		$	585,623		$	579,652
Total equity / total assets		5.89	%		5.71	%		5.18	%		5.41	%		5.82	%
Book value per share	$	24.57		$	22.48		$	20.81		$	21.51		$	22.93
Shares outstanding		1,479,862			1,479,862			1,469,091			1,474,091			1,471,591

CORNERSTONE COMMUNITY BANCORP
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(Dollars in Thousands)
	Three months ended
	03/31/23			12/31/22			03/31/22
INTEREST INCOME
Loans	$	5,551		$	5,178		$	4,348
Federal funds sold		1			1			-
Investment securities		724			676			371
Other		467			515			58
Total interest income		6,744			6,370			4,777
INTEREST EXPENSE
Deposits:
Interest-bearing demand		247			214			46
Money market and savings		579			450			117
Time deposits		589			401			107
Other		149			149			157
Total interest expense		1,564			1,214			427
Net interest income		5,180			5,156			4,350
Provision for credit losses on loans		110			-			18
Net interest income after provision
for credit losses		5,070			5,156			4,332
NON-INTEREST INCOME
Service charges on deposit accounts		62			66			71
Gain on sale of loans		-			-			-
Gain (loss) on sale of other real estate owned		-			-			-
Gain (loss) on sale of securities		-			-			-
Other non-interest income		247			199			193
Total non-interest income		310			265			264
OPERATING EXPENSES
Salaries and benefits		1,649			1,567			1,146
Premises and fixed assets		313			242			191
Other		1,061			941			906
Total operating expenses		3,024			2,750			2,243
Income before income taxes		2,355			2,671			2,353
Income taxes		660			745			678
NET INCOME	$	1,695		$	1,926		$	1,675
EARNINGS PER SHARE
Basic earnings per share	$	1.15		$	1.31		$	1.14
Diluted earnings per share	$	1.11		$	1.27		$	1.09
Average common shares outstanding		1,479,862			1,474,754			1,469,258
Average common and equivalent
shares outstanding		1,525,267			1,520,935			1,532,163
PERFORMANCE MEASURES
Return on average assets		1.13	%		1.32	%		1.15	%
Return on average equity		19.20	%		24.23	%		18.22	%
Tax-equivalent net interest margin		3.65	%		3.61	%		3.17	%
Efficiency ratio		55.09	%		50.73	%		48.61	%

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20230421005349/en/

Matthew B. Moseley

President & CEO

530.222.1460



Patrick E. Phelan

Chief Financial Officer

530.222.1460

Source: Cornerstone Community Bancorp

FAQ

What were the financial results for Cornerstone Community Bancorp (CRSB) in Q1 2023?

CRSB reported a net income of $1,695,000 and diluted EPS of $1.11 for Q1 2023.

How did Cornerstone Community Bancorp's net interest income perform in Q1 2023?

Net interest income increased to $5,180,000 in Q1 2023, up from $4,350,000 in the same quarter last year.

What is the return on average assets for CRSB in Q1 2023?

The return on average assets for Q1 2023 was 1.13%.

What was the total amount of deposits for Cornerstone Community Bancorp at the end of Q1 2023?

Total deposits at March 31, 2023, were $565.7 million.

What changes occurred in the allowance for credit losses for CRSB in Q1 2023?

The allowance for credit losses on loans increased to $5,397,000, or 1.25% of loans, net of unearned income.