Pacific West Bank (PWBO) Announces Second Quarter 2022 Earnings

Rhea-AI Summary

Pacific West Bank reported second quarter net income of $398 thousand, or $0.15 per diluted share, and $752 thousand for the first half of 2022, a 7.8% increase year-over-year. Key highlights include $16.8 million in core loan commitments and a 6% increase in deposits, totaling $232.1 million. Loan interest income rose by 5.7%, while investment interest income surged by 52.8%. Total assets remained steady at $274.5 million. The bank concluded its PPP loan forgiveness program, successfully managing 669 loans totaling $124.3 million.

Positive

• Second quarter net income increased to $398 thousand, a year-over-year growth.
• $16.8 million in core loan commitments originated during the quarter.
• Deposits grew by $13.1 million, or 6%.
• Loan interest income increased by $115 thousand, or 5.7%, compared to the prior quarter.
• Investment interest income grew significantly by $108 thousand, or 52.8%, compared to the prior quarter.
• Strong credit quality with no non-accrual loans or past due loans greater than 30 days.

Negative

• Unrealized loss of $2.6 million within the investment portfolio due to mark-to-market accounting adjustments as interest rates rise.

WEST LINN, Ore., July 28, 2022 /PRNewswire/ -- Pacific West Bank ("Bank") today announced second quarter net income of $398 thousand or $0.15 per diluted share and net income for the first half of the year of $752 thousand or $0.28 per diluted share.

 Second Quarter 2022 Results:

• Net income of $398 thousand, or $0.15 per diluted share.
• $16.8 million in core loan commitments originated during the quarter.
• Deposits grew $13.1 million, or 6%.
• Loan interest income grew by $115 thousand, or 5.7% compared to prior quarter.
• Investment interest income grew by $108 thousand or 52.8% compared to prior quarter.
• Total assets as of quarter-end were $274.5 million.
• There were no non-accrual loans or past due loans greater than 30-days as of quarter-end.
• Payroll Protection Plan ("PPP") loan forgiveness was concluded during the quarter.
• Capital levels as of March 31, 2022, remained strong with a leverage ratio of 12.62%.

"The second quarter of 2022 marks another historic milestone for the Bank and its commitment to the Portland business community with the appointment of two prominent business leaders to our Board of Directors and the approval of a bank holding company by our shareholders," said Ed Kawasaki, Chairman of the Board. "The business community responded enthusiastically to the announcement that Terri Sorensen and Erin Hubert had joined our Board."

First Six Months 2022 Results: Net income grew for the first half of the year by 7.8% when compared to the same six-month period of 2021. Interest income grew by $957 thousand (an increase of 30%), and investment interest income grew by $226 thousand (an increase of 78%). The net income growth percentage was tempered by the strong PPP interest and fee income achieved in the first half of last year.

Total assets were $274.5 million as of June 30, 2022, roughly the same as year-end 2021. While total assets remained level, asset mix improved with cash being deployed into core loans and investments. Core loans increased $17.0 million, or 10%, and investment in debt securities increased $10.6 million, or 30% from year end. This change in asset mix combined with rising interest rates has improved the Bank's yield on earning assets from 3.47% for the first half of 2021, to 4.25% for the first half of 2022. The Bank's net interest margin increased eighty-two basis points from 3.25% in the first half of 2021, to 4.07% in the first half of 2022. While the deployment of cash into investments has improved the Bank's earnings and net interest margins, it also caused an unrealized loss of $2.6 million within the investment portfolio due to mark-to-market accounting valuation adjustments, which are being experienced industry-wide as interest rates rise. The Bank does not expect to realize this loss caused by accounting adjustments as most, if not all, of the portfolio will be held until maturity.

Credit quality remains strong, with no loans greater than 30-days past due, and no loans on non-accrual status. The Bank continues to diligently monitor the loan portfolio as market interest rates fluctuate, causing uncertainty in the economic landscape.  

Deposits totaled $232.1 million as of June 30, 2022, which represents an increase of $13.1 million, or 6% over the prior quarter. "The granularity of our deposit portfolio has improved as larger, potentially volatile, deposit accounts have been replaced with relationship business accounts, as we continue to grow a stable deposit base," said Lisa Faust, Senior Vice President.

"We are proud to announce "mission accomplished" on the PPP Loan Program. We successfully guided 669 loans, totaling $124.3 million, through the PPP loan program, from origination to forgiveness. We were the number one bank in Oregon and Washington when measured by PPP loans to total assets. Our team of bankers stepped up to serve our community during the pandemic and proved that local matters, when it matters most," said the Bank's CEO Terry Peterson.

About Pacific West Bank: Information about the Bank's stock is available through the over-the-counter marketplace at www.otcmarkets.com  (symbol PWBO).

Pacific West Bank was formed in 2004 by Portland businesspeople to deliver loan and deposit product solutions through experienced and professional bankers to businesses, nonprofits, professionals, and individuals. The Bank serves the greater Portland Metro area with offices strategically located in Downtown Portland, Lake Oswego, and West Linn.

Media Contact:
Terry A. Peterson
Chief Executive Officer
(503) 905-2217
tpeterson@bankpacificwest.com

Certain statements in this release may be deemed to be "forward-looking statements." Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. These statements are based on current plans, estimates and projections, and therefore you should not place undue reliance on them. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update publicly any of them in light of new information or future events. Forward-looking statements involve inherent risks and uncertainties. We caution you that a number of important factors could cause actual results to differ materially from those contained in any forward-looking statement.

 

Balance Sheets (amounts in 000s, except per share data and ratios)
			June 30,				% Change		December 31		% Change
			2022		2021		YOY		2021		YTD
ASSETS
	Cash & due from banks		$                24,141		$             43,472		-44.5 %		$           28,040		-13.9 %
	Investments - CD		2,485		2,685		-7.4 %		2,685		-7.4 %
	Investments -  Debt Securities		46,625		37,355		24.8 %		35,994		29.5 %
	Investments - Correspondent Stock		1,030		954		7.9 %		954		7.9 %
	Gross loans net of fees		190,957		189,827		0.6 %		195,527		-2.3 %
	Allowance for loan losses		(2,475)		(1,825)		35.6 %		(2,225)		11.2 %
		Net loans	188,482		188,002		0.3 %		193,302		-2.5 %
	Premises and equipment, net		4,229		4,672		-9.5 %		4,451		-5.0 %
	Deferred tax asset, net		2,371		1,525		55.4 %		1,525		55.4 %
	BOLI		4,176		4,048		3.2 %		4,104		1.8 %
	Other assets		1,008		1,278		-21.1 %		3,637		-72.3 %
		Total Assets	$              274,546		$           283,991		-3.3 %		$         274,693		-0.1 %
LIABILITIES
	Deposits		$              232,054		$           226,217		2.6 %		$         231,263		0.3 %
	Borrowed funds		5,000		20,209		-75.3 %		5,000		0.0 %
	Other liabilities		4,018		3,221		24.7 %		3,306		21.6 %
		Total Liabilities	241,073		249,647		-3.4 %		239,569		0.6 %
STOCKHOLDERS' EQUITY			33,473		34,344		-2.5 %		35,124		-4.7 %
		Total Liabilities and Stockholders' Equity	$              274,546		$           283,991		-3.3 %		$         274,693		-0.1 %
Shares outstanding at end-of-period			2,665,535		2,658,051				2,662,566
Book value per share			$                  12.56		$               12.92				$             13.19
Allowance for loan losses to total loans			1.30 %		0.96 %				1.14 %
Non-performing assets (non-accrual loans & OREO)			$                        -		$                    27				$                  18
Leverage Ratio			12.62 %		12.03 %				12.11 %

 

Statements of Net Income (amounts in 000s, except per share data and ratios)
			Three Months Ended								Six Months Ended
			6/30/2022		3/31/2022			% Change				6/30/2022			6/30/2021			% Change
INTEREST INCOME
	Loans Interest Income		$                  2,146		$               2,031			5.7 %				$             4,177			$           3,220			29.7 %
	Investments & due from banks		312		204			52.8 %				516			290			77.9 %
	Loan fee income		328		411			-20.3 %				739			936			-21.0 %
		Total interest income	2,786		2,646			5.3 %				5,432			4,446			22.2 %
INTEREST EXPENSE			122		113			7.4 %				235			292			-19.5 %
NET INTEREST INCOME BEFORE LOAN LOSS PROVISION			2,664		2,533			5.2 %				5,197			4,154			25.1 %
PROVISION FOR LOAN LOSSES			100		150			-33.3 %				250			150			66.7 %
NET INTEREST INCOME AFTER LOAN LOSS PROVISION			2,564		2,383			7.6 %				4,947			4,004			23.6 %
NON-INTEREST INCOME			71		71			0.6 %				143			142			0.4 %
NON-INTEREST EXPENSE			2,008		1,978			1.5 %				3,986			3,208			24.2 %
INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES			628		476			32.0 %				1,104			938			17.7 %
PROVISION (BENEFIT) FOR INCOME TAXES			230		122			88.4 %				352			241			46.1 %
NET INCOME (LOSS)			$                     398		$                  354			12.5 %				$                752			$              697			7.8 %
Earnings per share - Basic			$                    0.15		$                 0.13							$               0.28			$             0.26
Earnings per share - Diluted			$                    0.15		$                 0.13							$               0.28			$             0.26
Return on average equity			4.71 %		4.09 %							4.40 %			4.58 %
Return on average assets			0.59 %		0.53 %							0.56 %			0.89 %
Net interest margin			4.17 %		3.97 %							4.07 %			3.25 %
Efficiency ratio			76 %		76 %							76 %			75 %

 

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SOURCE Pacific West Bank

FAQ

What were Pacific West Bank's second quarter earnings for 2022?

Pacific West Bank reported second quarter net income of $398 thousand or $0.15 per diluted share.

How much did Pacific West Bank's deposits grow in Q2 2022?

Deposits increased by $13.1 million, or 6%, during the second quarter.

What was the increase in loan interest income reported by Pacific West Bank?

Loan interest income grew by $115 thousand, or 5.7%, compared to the previous quarter.

What was the total amount of PPP loans managed by Pacific West Bank?

The bank managed 669 PPP loans totaling $124.3 million.

What is the total asset value reported by Pacific West Bank as of June 30, 2022?

Total assets were reported at $274.5 million.