Cornerstone Community Bancorp Reports Financial Results For the Second Quarter Ended June 30, 2023

Rhea-AI Summary

Cornerstone Community Bancorp (OTC Pink: CRSB) reported net income of $1,864,000 for Q2 2023, compared to $1,706,000 for the same period last year. Diluted earnings per share were $1.22, up from $1.12. Return on average assets was 1.20% and return on average equity was 19.71%. Net interest income increased to $5,541,000. Provision for credit losses on loans increased to $220,000. Non-interest income was $353,000. Non-interest expense was $3,085,000. Total loans were $447.3 million and total deposits were $569.3 million. Shareholders' equity was $38.3 million.

Positive

• Cornerstone Community Bancorp reported increased net income and diluted earnings per share for Q2 2023. Return on average assets and return on average equity also improved. Net interest income and total deposits increased. Shareholders' equity also grew.

Negative

• The provision for credit losses on loans increased for Q2 2023. Non-interest expense also increased.

RED BLUFF, Calif.--(BUSINESS WIRE)-- Cornerstone Community Bancorp (OTC Pink: CRSB) announced today its financial results for the second quarter ended June 30, 2023.

The Company reported net income of $1,864,000 for the three months ended June 30, 2023 compared to net income of $1,706,000 for the same period last year. Diluted earnings per share were $1.22 for the three months ended June 30, 2023 compared to $1.12 for the same period last year.

The return on average assets for the three months ended June 30, 2023 was 1.20% and the return on average equity was 19.71%. The tax-equivalent net interest margin was 3.73% for the three months ended June 30, 2023 compared to 3.32% for the same period last year.

For the six months ended June 30, 2023, the Company reported net income of $3,559,000 compared to net income of $3,381,000 for the same period last year. Diluted earnings per share were $2.34 for the six months ended June 30, 2023 compared to $2.21 for the same period last year.

The return on average assets for the six months ended June 30, 2023 was 1.16% and the return on average equity was 19.47%.

President and CEO, Matt Moseley stated, “I am proud of Cornerstone’s performance as our team continues to work hard to meet the financial needs of our customers and our community.”

Net Interest Income

Net interest income increased to $5,541,000 for the quarter ended June 30, 2023 compared to $4,605,000 for the same quarter last year. For the six months ended June 30, 2023, net interest income increased to $10,720,000 compared to $8.955,000 for the same period last year.

Provision for credit losses on loans

The Company recorded a $220,000 provision for credit losses on loans during the three months ended June 30, 2023 compared to $55,000 for the same period last year. For the six months ended June 30, 2023, the Company recorded a $330,000 provision for credit losses compared to $73,000 for the same period last year.

Non-Interest Income

Non-interest income for the quarter ended June 30, 2023 was $353,000 compared to $266,000 for the quarter ended June 30, 2022. For the six months ended June 30, 2023, noninterest income was $662,000 compared to $530,000 for the same period last year.

Non-Interest Expense

Non-interest expense was $3,085,000 for the quarter ended June 30, 2023 compared to $2,426,000 for the same period last year. For the six months ended June 30, 2023, non-interest expense was $6,108,000 compared to $4,669,000 for the same period last year.

Balance Sheet

Total loans, net of unearned income, at June 30, 2023 were $447.3 million compared to $399.2 million at June 30, 2022.

Total deposits were $569.3 million at June 30, 2023 compared to total deposits of $539.6 million at June 30, 2022.

Credit Quality

The allowance for credit losses on loans was $5,617,000, or 1.26% of loans, net of unearned income, at June 30, 2023, compared to $5,132,000, or 1.29% of loans, net of unearned income, at June 30, 2022. Nonperforming assets totaled $233,000 at June 30, 2023. There were no nonperforming assets at June 30, 2022.

Capital

At June 30, 2023, shareholders’ equity totaled $38.3 million compared to $31.7 million at June 30, 2022. At June 30, 2023, the Company's book value per common share was $25.89 compared to $21.51 at June 30, 2022.

At June 30, 2023, the Bank’s estimated total risk-based capital ratio was 12.89% and its tier 1 capital to risk weighted assets ratio was 11.77%. 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)
	06/30/23				03/31/23				12/31/22				09/30/22				06/30/22
ASSETS
Cash and due from banks	$	8,482			$	7,365			$	5,628			$	6,011			$	5,230
Federal funds sold		-				124				123				122				121
Interest-bearing deposits		34,076				44,706				25,212				57,618				48,277
Investment securities		93,889				95,139				94,435				95,511				102,692
Loans held for sale		-				-				-				-				-
Loans, net of unearned income		447,339				431,475				420,415				400,480				399,156
Allowance for loan losses		(5,617	)			(5,397	)			(5,159	)			(5,172	)			(5,132	)
Loans, net		441,722				426,079				415,256				395,308				394,024
Premises and equipment, net		14,492				14,492				14,601				14,671				14,691
Other assets		29,724				28,906				27,326				21,261				20,588
Total assets	$	622,385			$	616,812			$	582,581			$	590,502			$	585,623
LIABILITIES
Deposits:
Demand noninterest-bearing	$	109,775			$	125,008			$	126,946			$	129,236			$	130,249
Demand interest-bearing		179,508				165,203				136,655				138,630				131,623
Money market and savings		177,976				180,996				182,787				201,316				201,106
Time deposits		101,991				94,542				88,430				76,121				76,576
Total deposits		569,250				565,749				534,818				545,303				539,554
Borrowings and other obligations		-				-				-				-				-
Subordinated debentures		11,756				11,750				11,744				11,738				11,732
Interest payable and other liabilities		3,070				2,954				2,755				2,892				2,631
Total liabilities		584,076				580,452				549,317				559,933				553,917
SHAREHOLDERS' EQUITY
Common stock		15,140				15,113				15,075				14,964				15,079
Retained Earnings		33,827				31,963				30,294				28,368				26,432
Accumulated other comprehensive income (loss)		(10,658	)			(10,716	)			(12,105	)			(12,763	)			(9,805	)
Total shareholders' equity		38,309				36,360				33,264				30,569				31,706
Total liabilities and shareholders' equity	$	622,385			$	616,812			$	582,581			$	590,502			$	585,623
Total equity / total assets		6.16	%			5.89	%			5.71	%			5.18	%			5.41	%
Book value per share	$	25.89			$	24.57			$	22.48			$	20.81			$	21.51
Shares outstanding		1,479,862				1,479,862				1,479,862				1,469,091				1,474,091

CORNERSTONE COMMUNITY BANCORP
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(Dollars in Thousands)
	Three months ended												Six months ended
	06/30/23				03/31/23				06/30/22				06/30/23				06/30/22
INTEREST INCOME
Loans	$	5,955			$	5,551			$	4,485			$	11,506			$	8,833
Federal funds sold		2				1				-				3				-
Investment securities		734				724				464				1,458				835
Other		667				467				146				1,134				204
Total interest income		7,358				6,744				5,095				14,101				9,872
INTEREST EXPENSE
Deposits:
Interest-bearing demand		209				247				64				456				110
Money market and savings		675				579				147				1,254				264
Time deposits		784				589				131				1,373				238
Other		149				149				148				298				305
Total interest expense		1,817				1,564				490				3,381				917
Net interest income		5,541				5,180				4,605				10,720				8,955
Provision for credit losses		220				110				55				330				73
Net interest income after provision
for credit losses		5,321				5,070				4,550				10,390				8,882
NON-INTEREST INCOME
Service charges on deposit accounts		75				62				62				137				133
Gain on sale of loans		-				-				-				-				-
Gain (loss) on sale of other real estate owned		-				-				-				-				-
Gain (loss) on sale of securities		-				-				-				-				-
Other non-interest income		278				247				204				525				397
Total non-interest income		353				310				266				662				530
OPERATING EXPENSES
Salaries and benefits		1,668				1,649				1,219				3,317				2,365
Premises and fixed assets		266				313				194				579				385
Other		1,151				1,061				1,013				2,212				1,919
Total operating expenses		3,085				3,024				2,426				6,108				4,669
Income before income taxes		2,589				2,355				2,390				4,944				4,743
Income taxes		725				660				684				1,385				1,362
NET INCOME	$	1,864			$	1,695			$	1,706			$	3,559			$	3,381
EARNINGS PER SHARE
Basic earnings per share	$	1.26			$	1.15			$	1.16			$	2.41			$	2.30
Diluted earnings per share	$	1.22			$	1.11			$	1.12			$	2.34			$	2.21
Average common shares outstanding		1,479,862				1,479,862				1,472,168				1,479,862				1,470,721
Average common and equivalent
shares outstanding		1,522,072				1,525,267				1,529,540				1,523,716				1,530,890
PERFORMANCE MEASURES
Return on average assets		1.20	%			1.13	%			1.18	%			1.16	%			1.17	%
Return on average equity		19.71	%			19.20	%			20.33	%			19.47	%			19.23	%
Tax-equivalent net interest margin		3.73	%			3.65	%			3.32	%			3.69	%			3.25	%
Efficiency ratio		52.34	%			55.09	%			49.80	%			53.66	%			49.23	%

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20230725758292/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 Cornerstone Community Bancorp's net income and diluted earnings per share for Q2 2023?

Cornerstone Community Bancorp reported net income of $1,864,000 and diluted earnings per share of $1.22 for Q2 2023.

How did the return on average assets and return on average equity compare to last year?

The return on average assets for Q2 2023 was 1.20%, an improvement from the same period last year. The return on average equity was 19.71%, also an improvement.

What was the net interest income for Q2 2023?

Net interest income increased to $5,541,000 for Q2 2023.

What was the provision for credit losses on loans for Q2 2023?

The provision for credit losses on loans increased to $220,000 for Q2 2023.

What was the non-interest income for Q2 2023?

Non-interest income was $353,000 for Q2 2023.

What was the non-interest expense for Q2 2023?

Non-interest expense was $3,085,000 for Q2 2023.

What were the total loans and total deposits at June 30, 2023?

Total loans were $447.3 million and total deposits were $569.3 million at June 30, 2023.

What was the shareholders' equity at June 30, 2023?

Shareholders' equity totaled $38.3 million at June 30, 2023.