American Riviera Bank Reports Strong Growth and Expansion

SANTA BARBARA, Calif.–(BUSINESS WIRE)–American Riviera Bank (OTC Markets: ARBV) announced today unaudited net income of $3,274,000 ($0.65 per share) for the six months ended June 30, 2019. This represents a 16% increase in net income from the $2,827,000 ($0.64 per share) for the same reporting period in the prior year. The Bank reported an annualized return on average assets of 1.07% and return on average equity of 10.06%. The Bank reported unaudited net income of $1,506,000 ($0.30 per share) for the second quarter ended June 30, 2019 compared to $1,475,000 ($0.33 per share) for the same quarter last year. Share count has increased primarily due to the $8,500,000 common stock capital raise closed in the first quarter ended March 31, 2019.

The Bank continues to experience significant growth, reporting $662 million in total assets as of June 30, 2019. Total deposits, excluding wholesale deposits, increased 16% from June 30, 2018. The Bank had $5 million of wholesale deposits at June 30, 2019, down from the $49 million at June 30, 2018. Over the past twelve months the Bank has replaced these wholesale deposits with local customer deposits. Non-interest bearing demand deposit accounts increased $18 million, or 11% from the same reporting period last year, reaching $187 million at June 30, 2019.

The Bank reported strong loan growth, with gross loans increasing $64 million, or 13% from June 30, 2018, reaching $542 million at June 30, 2019, with no other real estate owned and no loans 30 or more days past due. The Bank’s net interest income increased by approximately $1.5 million, or 13% for the six months ended June 30, 2019, compared to the same reporting period in the prior year. The Bank reported an annualized net interest margin of 4.34% for the six months ended June 30, 2019, reflecting only modest compression from the 4.52% reported for the same reporting period last year.

Jeff DeVine, President and Chief Executive Officer stated, We continue to invest in our expansion and are pleased to announce the opening of our full service branch in the City of San Luis Obispo which will allow us to better serve the needs of businesses and consumers in San Luis Obispo County. We look forward to welcoming new clients affected by mega-mergers who will benefit from our high level of service built on relationships with local decision makers.”

As of June 30, 2019, American Riviera Bank has a strong capital position with a Tier 1 Capital Ratio of 12%; well above the regulatory guideline of 8% for well capitalized institutions. The tangible book value per share of American Riviera Bank common stock is $13.41 at June 30, 2019, a 14% increase from $11.80 at June 30, 2018.

Company Profile

American Riviera Bank is a full-service community bank focused on serving the lending and deposit needs of businesses and consumers on the Central Coast of California. The state-chartered bank opened for business on July 18, 2006, with the support of local shareholders. Full-service branches are located in Santa Barbara, Montecito, Goleta, San Luis Obispo and Paso Robles. The bank provides commercial, residential mortgage, construction and Small Business Administration lending services as well as convenient online and mobile technology. For nine consecutive years the Bank has been recognized for strong financial performance by the Findley Reports, and received the highest “Super Premier” rating from Findley for 2018 and 2017. As of March 31, 2019, the Bank was rated five stars by BauerFinancial.

Statements concerning future performance, developments or events concerning expectations for growth and market forecasts, and any other guidance on future periods, constitute forward looking statements that are subject to a number of risks and uncertainties. Actual results may differ materially from stated expectations. Specific factors include, but are not limited to, effects of interest rate changes, ability to control costs and expenses, impact of consolidation in the banking industry, financial policies of the US government, and general economic conditions.

Balance Sheets (unaudited)
(dollars in thousands)

Jun 30,

Jun 30,

One Year

2019

2018

Change

Assets
Cash & Due From Banks

$

47,640

 

$

42,796

 

11

%

Fed Funds Sold

 

 

 

 

 

Securities

 

42,961

 

 

48,274

 

-11

%

 
Loans

 

541,869

 

 

477,837

 

13

%

Allowance For Loan Losses

 

(5,883

)

 

(4,895

)

20

%

Net Loans

 

535,986

 

 

472,942

 

13

%

 
Fixed Assets

 

6,528

 

 

5,294

 

23

%

Goodwill and Other Intangibles

 

5,427

 

 

5,606

 

-3

%

Other Assets

 

23,054

 

 

16,320

 

41

%

Total Assets

 

661,596

 

 

591,232

 

12

%

 
 
Liabilities & Shareholders’ Equity
Demand Deposits

 

186,845

 

 

168,609

 

11

%

NOW Accounts

 

73,782

 

 

86,543

 

-15

%

Other Interest Bearing Deposits

 

304,223

 

 

276,460

 

10

%

Total Deposits

 

564,850

 

 

531,612

 

6

%

 
Borrowed Funds

 

15,000

 

 

 

N/M

 

Other Liabilities

 

8,806

 

 

2,134

 

313

%

Total Liabilities

 

588,656

 

 

533,746

 

10

%

 
Common Stock

 

54,739

 

 

46,212

 

18

%

Retained Earnings

 

18,105

 

 

11,768

 

54

%

Other Capital

 

96

 

 

(494

)

N/M

 

Total Shareholders’ Equity

 

72,940

 

 

57,486

 

27

%

 
Total Liabilities & Shareholders’ Equity

$

661,596

 

$

591,232

 

12

%

 
Book Value Per Share

$

14.49

 

$

13.06

 

11

%

Tangible Book Value Per Share

$

13.41

 

$

11.80

 

14

%

Statements of Income (unaudited)
(dollars in thousands)

Quarter Ended

 

6 Months Ended

Jun 30,

 

Jun 30,

 

 

 

Jun 30,

 

Jun 30,

 

 

2019

 

2018

 

Change

 

2019

 

2018

 

Change

Interest Income
Interest and Fees on Loans

$

6,992

 

$

5,769

 

21

%

$

13,672

 

$

11,037

 

24

%

Net Fair Value Amortization Income

 

86

 

 

176

 

-51

%

 

308

 

 

306

 

1

%

Interest on Securities

 

230

 

 

253

 

-9

%

 

514

 

 

437

 

18

%

Interest on Fed Funds

 

0

 

 

1

 

-100

%

 

1

 

 

11

 

-91

%

Interest on Due From Banks

 

205

 

 

122

 

68

%

 

403

 

 

269

 

50

%

Total Interest Income

 

7,513

 

 

6,321

 

19

%

 

14,898

 

 

12,060

 

24

%

 
Interest Expense
Interest Expense on Deposits

 

998

 

 

326

 

206

%

 

1,822

 

 

592

 

208

%

Interest Expense on Borrowings

 

60

 

 

98

 

-39

%

 

202

 

 

120

 

68

%

Total Interest Expense

 

1,058

 

 

424

 

150

%

 

2,024

 

 

712

 

184

%

 
Net Interest Income

 

6,455

 

 

5,897

 

9

%

 

12,874

 

 

11,348

 

13

%

Provision for Loan Losses

 

220

 

 

363

 

-39

%

 

395

 

 

631

 

-37

%

Net Interest Income After Provision

 

6,235

 

 

5,534

 

13

%

 

12,479

 

 

10,717

 

16

%

 
Non-Interest Income
Service Charges, Commissions and Fees

 

580

 

 

409

 

42

%

 

1,007

 

 

845

 

19

%

Other Non-Interest Income

 

113

 

 

84

 

35

%

 

279

 

 

198

 

41

%

Total Non-Interest Income

 

693

 

 

493

 

41

%

 

1,286

 

 

1,043

 

23

%

 
Non-Interest Expense
Salaries and Employee Benefits

 

2,881

 

 

2,278

 

26

%

 

5,573

 

 

4,631

 

20

%

Occupancy and Equipment

 

546

 

 

429

 

27

%

 

1,040

 

 

821

 

27

%

Other Non-Interest Expense

 

1,366

 

 

1,227

 

11

%

 

2,679

 

 

2,376

 

13

%

Total Non-Interest Expense

 

4,793

 

 

3,934

 

22

%

 

9,292

 

 

7,828

 

19

%

 
Net Income Before Provision for Taxes

 

2,135

 

 

2,093

 

2

%

 

4,473

 

 

3,932

 

14

%

Provision for Taxes

 

629

 

 

618

 

2

%

 

1,199

 

 

1,105

 

9

%

Net Income

$

1,506

 

$

1,475

 

2

%

$

3,274

 

$

2,827

 

16

%

 
Shares (end of period)

 

5,028,906

 

 

4,440,082

 

13

%

 

5,028,906

 

 

4,440,082

 

13

%

Earnings Per Share – Basic

$

0.30

 

$

0.33

 

-9

%

$

0.65

 

$

0.64

 

2

%

 
Return on Average Assets (annualized)

 

0.95

%

 

1.07

%

 

1.07

%

 

1.08

%

Return on Average Equity (annualized)

 

8.46

%

 

10.47

%

 

10.06

%

 

10.37

%

Net Interest Margin (annualized)

 

4.27

%

 

4.54

%

 

4.34

%

 

4.52

%

 

Contacts

American Riviera Bank

Michelle Martinich, 805-965-5942

www.americanrivierabank.com