RBAZ Bancorp, Inc. Announces Unaudited Financial Results For the Quarter Ending December 31, 2022

Rhea-AI Summary

RBAZ Bancorp, Inc. reported a strong financial performance for Q4 2022, achieving a net income of $644,000 or $0.36 per share, a significant increase from $373,000 or $0.21 per share in Q4 2021. For the full year, net income remained stable at $1.06 per share compared to 2021. Core earnings saw a remarkable 50% year-over-year increase, driven by a 14% rise in net interest income and a 32% boost in non-interest income. Total loans surged to $162.95 million, marking a 20.4% growth, though total deposits dipped 1% to $203.33 million. The bank maintains a robust 11.39% capital ratio under the CBLR framework.

Positive

• 50% increase in core earnings year-over-year
• 14% rise in net interest income despite margin compression
• 32% increase in non-interest income
• Total loans increased by 20.4% to $162.95 million
• Strong loan production exceeding $20 million in net growth
• Well capitalized with a CBLR ratio of 11.39%

Negative

• Total deposits decreased by 1% to $203.33 million
• Total non-interest expenses increased by $325,000 to $1.58 million

50% Increase in Earnings from Core Banking Operations YoY

PHOENIX, Jan. 26, 2023 (GLOBE NEWSWIRE) -- RBAZ Bancorp, Inc. (OTCIQ: RBAZ) (the “Company”), parent company of Republic Bank of Arizona (the “Bank” or “RBAZ”), announced a consolidated net income of $644,000, or $0.36 per share, for the quarter ended December 31, 2022 and $1,913,000, or $1.06 per share, for the twelve months ended December 31, 2022 as compared to a consolidated net income of $373,000, or $0.21 per share, for the quarter ended December 31, 2021 and $1,918,000, or $1.06 per share, for the twelve months ended December 31, 2021. Current year earnings of $1.06 per share were comprised of $0.96 per share attributable to core operations and $0.10 per share due to impacts from the Paycheck Protection Program (“PPP”). Prior year earnings of $1.06 per share were comprised of $0.63 per share attributable to core operations and $0.43 per share due to impacts from the PPP.

President and CEO Brian Ruisinger stated, “Our core earnings increased over 50% year-over-year as net interest income increased 14% despite rapid rate increases by the Federal Reserve resulting in industry-wide margin compression. Additionally, I am pleased to report we achieved a 32% increase year-over-year in non-interest income as leadership placed a priority on this area in our strategic plan to supplement earnings in anticipation of margin compression.”

Mr. Ruisinger continued, “RBAZ had a very eventful fourth quarter. We opened our branch in Gilbert, AZ allowing us to expand our presence into the East Valley of Phoenix. Additionally, we had an extremely strong quarter of loan production exceeding $20 million in net growth, which will position us well heading into 2023. To support our growth, expansion and lending capacity, we have launched a capital raise expected to close by the end of Q1. RBAZ remains poised for continued growth in its mission to be the premier Arizona-based community bank, as reflected in our Bauer Five-Star bank rating.”

December 31, 2022 Company Highlights Include:

• Total loans of $162,954,000 increased $27,558,000, or 20.4%, from December 31, 2021. This increase consisted of $32,166,000, or 23.8%, in net portfolio loan growth, offset by $4,608,000 of PPP loan forgiveness received during the year.
• Total deposits of $203,332,000 were down $2,071,000, or 1.0%, from December 31, 2021. This decrease consisted of $17,255,000 in anticipated deposit outflows relating to capital accounts for De Novo institutions that opened for business during 2022, offset by $15,184,000 in net deposit growth through deepening of existing relationships and generation of new banking relationships.
• Total borrowings of $14,900,000 increased $9,030,000 from December 31, 2021. This increase consisted of advances from overnight borrowing facilities at year-end to accommodate a timing difference in loan fundings and receipt of deposit funds. Borrowings were repaid January 3, 2023.
• Total interest income increased $666,000 to $2,619,000 for the quarter ended December 31, 2022 outpacing total interest income of $1,953,000 for the same period of the prior year equating to an increase of 34.1%.
• Cost of funds was increased to 1.35% for the quarter ended December 31, 2022 from 0.51% for the quarter ended December 31, 2021 as the result of upward rate pressure as the Federal Reserve increased interest rates by 4.25% in 2022.
• Total non-interest expense is up $325,000 to $1,580,000 for the quarter ended December 31, 2022 compared to $1,255,000 for the same period of the prior year resulting primarily from several additional full-time employees, the addition of the Gilbert branch, and investments made in technology and marketing in support of the Company’s growth.

The Bank remains “Well Capitalized” under the Community Bank Leverage Ratio (CBLR) framework as follows:

	December 31, 2022 (%)		Ratio to be Well Capitalized (%)
CBLR ratio	11.39		9.00

About the Company
RBAZ Bancorp, Inc. was established on June 10, 2021 as a single-bank holding company for its Arizona state-chartered bank subsidiary, Republic Bank of Arizona. The Company is traded over-the-counter as RBAZ.

About the Bank
Republic Bank of Arizona is a locally owned, community bank in Phoenix, Scottsdale and Gilbert, Arizona. RBAZ is a full service, community bank providing deposit and loan products and convenient, online and mobile banking to individuals, businesses and professionals. The Bank was established in April 2007 and is headquartered at 645 E. Missouri Avenue, Suite 108, Phoenix, AZ. Our second location is at 6909 E. Greenway Parkway, Suite 150, Scottsdale, AZ. Our third location opened in October 2022 at 1417 W. Elliot Road, Gilbert, AZ. The Bank is the wholly-owned subsidiary of RBAZ Bancorp, Inc. For further information, please visit our web site: www.republicbankaz.com.

Forward-looking Statements
This press release may include forward-looking statements about the Company and the Bank (collectively referred to herein as the “Company”), for which the Company claims the protection of safe harbor provisions contained in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on management’s knowledge and belief as of today and include information concerning the Company’s possible or assumed future financial condition, and its results of operations and business. Forward-looking statements are subject to risks and uncertainties. A number of important factors could cause actual results to differ materially from those in the forward-looking statements. Those factors include fluctuations in interest rates, government policies and regulations (including monetary and fiscal policies), legislation, economic conditions, borrower capacity to repay, operational factors and competition in the geographic and business areas in which the Company conducts its operations. All forward-looking statements included in this press release are based on information available at the time of the release, and the Company assumes no obligation to update any forward-looking statement.

	Summary Financial Information (unaudited)
	For the three months ended December 31,		For the twelve months ended December 31,
	2022	2021	2022	2021*
	(dollars in thousands, except per share data)
Summary Income Data:
Interest income	$2,619	$1,953	$9,218	$7,544
Interest expense	692	257	1,674	945
Net interest income	1,927	1,696	7,544	6,599
Provision for loan losses	47	52	218	176
Non-interest income	390	73	511	386
Non-interest expense	1,580	1,255	5,386	4,328
Realized loss on sales of securities	-	-	-	7
Income before income taxes	690	462	2,451	2,474
Provision for income tax	46	89	538	556
Net income	$644	$373	$1,913	$1,918
Per Share Data:
Shares outstanding end-of-period	1,797	1,805	1,797	1,805
Earnings per common share	$0.36	$0.21	$1.06	$1.06
Diluted earnings per common share	$0.34	$0.20	$1.02	$1.01
Total shareholders’ equity	$18,166	$18,672	$18,166	$18,672
Book value per share	$10.11	$10.34	$10.11	$10.34
Selected Balance Sheet Data:
Total assets	$237,620	$231,420	$237,620	$231,420
Securities available-for-sale, at fair value	43,441	38,041	43,441	38,041
Securities held-to-maturity	12,176	8,510	12,176	8,510
Loans	162,954	135,396	162,954	135,396
Allowance for loan losses	1,764	1,468	1,764	1,468
Deposits	203,332	205,403	203,332	205,403
Other borrowings	14,900	5,870	14,900	5,870
Shareholders’ equity	18,166	18,672	18,166	18,672
Performance Ratios:
Return on average shareholders’ equity (annualized) (%)	14.18	7.99	10.53	10.27
Net interest margin (%)	3.46	3.06	3.21	3.09
Average assets	$227,809	$230,370	$239,864	$220,742
Return on average assets (annualized) (%)	1.13	0.65	0.80	0.87
Shareholders’ equity to assets (%)	7.64	8.07	7.64	8.07
Efficiency ratio (%)	68.19	70.94	66.87	61.96
Asset Quality Data:
Nonaccrual loans	$118	$-	$118	$-
Troubled debt restructurings	$156	$234	$156	$234
Other real estate	$-	$-	$-	$-
Nonperforming loans	$118	$82	$118	$82
Nonperforming loans to total assets (%)	0.05	0.04	0.05	0.04
Nonperforming loans to total loans (%)	0.07	0.06	0.07	0.06
Reserve for loan losses to total loans (%)	1.08	1.08	1.08	1.08
Reserve for loan losses to nonperforming loans (%)	1,494.92	1,790.24	1,494.92	1,790.24
Net recoveries for period	$25	$26	$78	$68
Average loans	$146,628	$122,131	$138,529	$117,309
Ratio of net recoveries to average loans (%)	0.02	0.02	0.06	0.06
*RBAZ Bancorp, Inc. was formed on June 10, 2021. Data for 2021 period consists of Bank data beginning January 1, 2021 and Company data beginning June 10, 2021.

Contact:  Brian Ruisinger
President and Chief Executive Officer
Phone:  602.280.9404
Email:  bruisinger@republicaz.com

FAQ

What were RBAZ Bancorp's earnings results for Q4 2022?

RBAZ Bancorp reported a net income of $644,000 or $0.36 per share for Q4 2022.

How much did RBAZ Bancorp's core earnings increase year-over-year?

Core earnings increased by 50% year-over-year.

What is RBAZ Bancorp's CBLR ratio?

RBAZ Bancorp maintains a CBLR ratio of 11.39%, indicating it is well-capitalized.

What was the total loan growth for RBAZ Bancorp?

Total loans increased by 20.4% to $162.95 million.

Did RBAZ Bancorp experience any deposit changes in 2022?

Yes, total deposits decreased by 1% to $203.33 million.