Cornerstone Community Bancorp Reports Financial Results For the First Quarter Ended March 31, 2024

Rhea-AI Summary

Cornerstone Community Bancorp (OTC Pink: CRSB) reported financial results for Q1 2024, with net income at $1,394,000, diluted earnings per share of $0.91, and a return on average assets of 0.86%. The company faced challenges in the banking industry but gained market share with a new digital banking platform. Net interest income decreased, provision for credit losses increased, non-interest income rose, and non-interest expense also increased. Total loans and deposits grew, credit quality improved, and shareholders' equity increased. The company remains well-capitalized.

Positive

• Net income for Q1 2024 was $1,394,000 compared to $1,695,000 in the same period last year.
• Diluted earnings per share were $0.91 for Q1 2024 compared to $1.11 in the same period last year.
• Return on average assets for Q1 2024 was 0.86%.
• Net interest income decreased to $4,884,000 for Q1 2024 compared to $5,180,000 for the same quarter last year.
• Provision for credit losses on loans increased to $144,000 for Q1 2024 compared to $110,000 for the same period last year.
• Non-interest income was $356,000 for Q1 2024 compared to $310,000 for Q1 2023.
• Non-interest expense increased to $3,202,000 for Q1 2024 compared to $3,024,000 for the same period last year.
• Total loans, net of unearned income, increased to $488.2 million at March 31, 2024, from $431.5 million at March 31, 2023.
• Total deposits grew to $590.0 million at March 31, 2024, from $565.7 million at March 31, 2023.
• Shareholders' equity rose to $44.6 million at March 31, 2024, from $36.4 million at March 31, 2023.
• Book value per common share increased to $29.99 at March 31, 2024, from $24.57 at March 31, 2023.
• The Bank's estimated total risk-based capital ratio was 12.89% at March 31, 2024, and its tier 1 capital to risk-weighted assets ratio was 11.80%.

Negative

• Net interest income decreased.
• Provision for credit losses on loans increased.
• Non-interest expense increased.
• The company experienced challenges in the banking industry.
• The Bank's tax-equivalent net interest margin decreased.
• There were no nonperforming assets at March 31, 2024, compared to $233,000 at March 31, 2023.

RED BLUFF, Calif.--(BUSINESS WIRE)-- Cornerstone Community Bancorp (OTC Pink: CRSB) announced today its financial results for the first quarter ended March 31, 2024.

The Company reported net income of $1,394,000 for the three months ended March 31, 2024 compared to net income of $1,695,000 for the same period last year. Diluted earnings per share were $0.91 for the three months ended March 31, 2024 compared to $1.11 for the same period last year.

The return on average assets for the three months ended March 31, 2024 was 0.86% and the return on average equity was 12.69%. The tax-equivalent net interest margin was 3.18% for the three months ended March 31, 2024 compared to 3.65% for the same period last year.

President and CEO, Matt Moseley stated, “The banking industry as a whole continues to be challenged with increasing liability costs and deposit competition. While Cornerstone has experienced an increase in cost of funds, the rate of increase is stabilizing and we continue to gain market share in the communities we serve. In March, Cornerstone rolled out a new and state of the art digital banking platform. The investment in new customer facing technology is already paying off and we have acquired new relationships as a result. In April, recognizing an opportune time to hedge interest rate risk, Cornerstone entered into an interest rate swap agreement that provides protection in a rising rate environment with limited overall cost if rates fall. While the economy will certainly present challenges, as it always does, our team is well prepared and will continue to execute on our strategy to run a safe and sound community bank that generates strong returns for our shareholders.”

Net Interest Income

Net interest income decreased to $4,884,000 for the quarter ended March 31, 2024 compared to $5,180,000 for the same quarter last year.

Provision for credit losses on loans

The Company recorded a $144,000 provision for credit losses on loans for the quarter ended March 31, 2024 compared to $110,000 for the same period last year.

Non-Interest Income

Non-interest income for the quarter ended March 31, 2024 was $356,000 compared to $310,000 for the quarter ended March 31, 2023.

Non-Interest Expense

Non-interest expense was $3,202,000 for the quarter ended March 31, 2024 compared to $3,024,000 for the same period last year.

Balance Sheet

Total loans, net of unearned income, at March 31, 2024 were $488.2 million compared to $431.5 million at March 31, 2023.

Total deposits were $590.0 million at March 31, 2024 compared to total deposits of $565.7 million at March 31, 2023.

Credit Quality

The allowance for credit losses on loans was $5,957,000, or 1.22% of loans, net of unearned income, at March 31, 2024, compared to $5,397,000, or 1.25% of loans, net of unearned income, at March 31, 2023. There were no nonperforming assets at March 31, 2024 compared to $233,000 at March 31, 2023.

Capital

At March 31, 2024, shareholders’ equity totaled $44.6 million compared to $36.4 million at March 31, 2023. At March 31, 2024, the Company's book value per common share was $29.99 compared to $24.57 at March 31, 2023.

At March 31, 2024, the Bank’s estimated total risk-based capital ratio was 12.89% and its tier 1 capital to risk weighted assets ratio was 11.80%. 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)
		03/31/24				12/31/23				09/30/23				06/30/23				03/31/23
ASSETS
Cash and due from banks		$	6,389			$	8,623			$	5,492			$	8,482			$	7,365
Federal funds sold			-				-				-				-				124
Interest bearing deposits in other financial institutions			45,955				19,694				23,970				34,076				44,706
Available for sale debt securities, at fair value			90,767				93,065				90,086				93,889				95,139
Loans held for sale			-				-				-				-				-
Loans, net of unearned income			488,179				482,212				470,060				447,339				431,475
Allowance for credit losses on loans			(5,957	)			(5,813	)			(5,813	)			(5,617	)			(5,397	)
Loans, net			482,222				476,399				464,247				441,722				426,079
Premises and equipment, net			14,433				14,326				14,437				14,492				14,492
Other assets			30,812				30,827				31,241				29,724				28,906
Total assets		$	670,578			$	642,934			$	629,472			$	622,385			$	616,812
LIABILITIES
Deposits:
Demand noninterest-bearing		$	99,278			$	101,396			$	100,791			$	109,775			$	125,008
Demand interest-bearing			159,542				166,221				190,645				179,508				165,203
Money market and savings			182,797				174,882				176,373				177,976				180,996
Time deposits			148,384				122,035				107,894				101,991				94,542
Total deposits			590,001				564,534				575,703				569,250				565,749
Borrowings and other obligations			20,000				20,000				-				-				-
Subordinated debentures			11,775				11,769				11,762				11,756				11,750
Interest payable and other liabilities			4,252				3,464				3,512				3,070				2,954
Total liabilities			626,028				599,767				590,977				584,076				580,452
SHAREHOLDERS' EQUITY
Common stock			15,231				15,163				15,130				15,140				15,113
Retained Earnings			39,033				37,639				35,747				33,827				31,963
Accumulated other comprehensive income (loss)			(9,714	)			(9,635	)			(12,382	)			(10,658	)			(10,716	)
Total shareholders' equity			44,550				43,167				38,495				38,309				36,360
Total liabilities and shareholders' equity		$	670,578			$	642,934			$	629,472			$	622,385			$	616,812
Total equity / total assets			6.64	%			6.71	%			6.12	%			6.16	%			5.89	%
Book value per share		$	29.99			$	29.16			$	26.01			$	25.89			$	24.57
Shares outstanding			1,485,472				1,480,472				1,479,862				1,479,862				1,479,862

CORNERSTONE COMMUNITY BANCORP
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(Dollars in Thousands)
		Three months ended
		03/31/24				12/31/23				03/31/23
INTEREST INCOME
Loans		$	7,006			$	6,862			$	5,551
Federal funds sold			-				-				1
Investment securities			728				751				724
Other			419				426				467
Total interest income			8,152				8,039				6,744
INTEREST EXPENSE
Deposits:
Interest-bearing demand			301				291				247
Money market and savings			1,146				904				579
Time deposits			1,432				1,245				589
Other			389				160				149
Total interest expense			3,268				2,600				1,564
Net interest income			4,884				5,439				5,180
Provision for credit losses			144				-				110
Net interest income after provision for credit losses			4,740				5,439				5,070
NON-INTEREST INCOME
Service charges on deposit accounts			75				70				62
Gain on sale of loans			-				-				-
Gain (loss) on sale of other real estate owned			-				-				-
Gain (loss) on sale of securities			-				-				-
Other non-interest income			281				288				247
Total non-interest income			356				358				310
OPERATING EXPENSES
Salaries and benefits			1,801				1,865				1,649
Premises and fixed assets			267				263				313
Other			1,134				1,045				1,061
Total operating expenses			3,202				3,173				3,024
Income before income taxes			1,894				2,624				2,355
Income taxes			500				732				660
NET INCOME		$	1,394			$	1,892			$	1,695
EARNINGS PER SHARE
Basic earnings per share		$	0.94			$	1.28			$	1.15
Diluted earnings per share		$	0.91			$	1.24			$	1.11
Average common shares outstanding			1,484,318				1,479,948				1,479,862
Average common and equivalent shares outstanding			1,529,931				1,523,488				1,525,267
PERFORMANCE MEASURES
Return on average assets			0.86	%			1.19	%			1.13	%
Return on average equity			12.69	%			18.94	%			19.20	%
Tax-equivalent net interest margin			3.18	%			3.55	%			3.65	%
Efficiency ratio			61.10	%			54.74	%			55.09	%

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20240424202657/en/

Matthew B. Moseley

President & CEO

530.222.1460

Patrick E. Phelan

Chief Financial Officer

530.222.1460

Source: Cornerstone Community Bancorp

FAQ

What was Cornerstone Community Bancorp's net income for Q1 2024?

Cornerstone Community Bancorp reported a net income of $1,394,000 for the first quarter ended March 31, 2024.

What was the diluted earnings per share for Cornerstone Community Bancorp in Q1 2024?

Cornerstone Community Bancorp had diluted earnings per share of $0.91 for the first quarter ended March 31, 2024.

What was the return on average assets for Cornerstone Community Bancorp in Q1 2024?

Cornerstone Community Bancorp's return on average assets for the first quarter ended March 31, 2024, was 0.86%.

How did Cornerstone Community Bancorp's net interest income change in Q1 2024 compared to the same quarter last year?

Cornerstone Community Bancorp's net interest income decreased to $4,884,000 for the quarter ended March 31, 2024, from $5,180,000 for the same quarter last year.

What was the provision for credit losses on loans for Cornerstone Community Bancorp in Q1 2024?

Cornerstone Community Bancorp recorded a $144,000 provision for credit losses on loans for the quarter ended March 31, 2024.

How did Cornerstone Community Bancorp's total loans and deposits change from March 31, 2023, to March 31, 2024?

Cornerstone Community Bancorp's total loans increased to $488.2 million at March 31, 2024, from $431.5 million at March 31, 2023. Total deposits grew to $590.0 million at March 31, 2024, from $565.7 million at March 31, 2023.

What was the shareholders' equity for Cornerstone Community Bancorp at March 31, 2024?

Cornerstone Community Bancorp had shareholders' equity of $44.6 million at March 31, 2024.

What was the book value per common share for Cornerstone Community Bancorp at March 31, 2024?

Cornerstone Community Bancorp's book value per common share was $29.99 at March 31, 2024.

What was the Bank's estimated total risk-based capital ratio at March 31, 2024?

The Bank's estimated total risk-based capital ratio was 12.89% at March 31, 2024.