Business Wire | Apr 13, 2021 01:07PM EDT

Cornerstone Community Bancorp Reports Financial Results For the First Quarter Ended March 31, 2021

Apr. 13, 2021

RED BLUFF, Calif.--(BUSINESS WIRE)--Apr. 13, 2021--Cornerstone Community Bancorp (OTC Pink: CRSB) announced today its financial results for the first quarter ended March 31, 2021.

The Company reported net income of $2,046,000 for the three months ended March 31, 2021 compared to net income of $47,000 for the same period last year. Diluted earnings per share were $1.38 for the three months ended March 31, 2021 compared to $0.03 for the same period last year.

The return on average assets for the three months ended March 31, 2021 was 1.56% and the return on average equity was 26.41%. The tax-equivalent net interest margin was 3.43% for the three months ended March 31, 2021 compared to 4.09% for the same period last year and the efficiency ratio declined to 35.61% for the three months ended March 31, 2021 compared to 58.65% for the same period last year.

President and CEO, Jeff Finck stated, "We had a solid performance in the first quarter. Our team continued to help both new and existing customers through the Paycheck Protection Program (PPP) application and forgiveness process."

Net Interest Income

Net interest income increased to $4,217,000 for the quarter ended March 31, 2021 compared to $2,842,000 for the same quarter last year. First quarter 2021 net interest income was driven by accelerated PPP fee recognition from borrower forgiveness processing.

Provision for credit losses

Provision for credit losses were $400,000 for the quarter ended March 31, 2021 compared to $1,450,000 for the same quarter last year.

Non-Interest Income

Non-interest income for the quarter ended March 31, 2021 was $877,000 compared to $394,000 for the quarter ended March 31, 2020.

Non-Interest Expense

Non-interest expense was $1,814,000 for the quarter ended March 31, 2021 compared to $1,898,000 for the same period last year.

Balance Sheet

Total loans, net of unearned income at March 31, 2021 were $382.3 million compared to $250.4 million at March 31, 2020.

Total deposits were $485.3 million at March 31, 2021 compared to total deposits of $268.0 million at March 31, 2020.

Credit Quality

The allowance for loan losses was $4,409,000, or 1.15% of loans, net of unearned income at March 31, 2021, compared to $3,859,000, or 1.54% of loans, net of unearned income at March 31, 2020. There were no nonperforming assets at March 31, 2021 and March 31, 2020.

Capital

At March 31, 2021, shareholders' equity totaled $31.4 million compared to $26.1 million at March 31, 2020. Book value was $21.65 per share at March 31, 2021 compared to $17.63 per share at March 31, 2020.

During the fourth quarter of 2021, the Company repurchased 500 shares of its common stock for a total of $9,500.

About Cornerstone Community Bancorp

Cornerstone Community Bancorp, a bank holding company headquartered in Red Bluff, California, serves the Red Bluff and Redding communities through its wholly-owned subsidiary, Cornerstone Community Bank with a headquarters office in Red Bluff and two banking offices in Redding. 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 Tax Cuts & Jobs Act of 2017 and the Coronavirus Aid, Relief and Economic Security Act of 2021), 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 BANCORPCONSOLIDATED BALANCE SHEETS (UNAUDITED)(Dollars in Thousands) 03/31/21 12/31/20 09/30/20 06/30/20 03/31/20 ASSETSCash and due from $ 5,417 $ 3,811 $ 5,455 $ 6,350 $ 4,965 banksFederal funds sold 5,761 14,166 5,045 10,402 17,385

Interest-bearing 68,283 77,045 62,110 73,310 18,928 depositsInvestment 52,084 50,336 50,699 16,173 13,144 securitiesLoans held for sale 1,102 - - - -

Loans, net of 382,253 332,176 342,416 333,620 250,353 unearned incomeAllowance for loan (4,409 ) (4,009 ) (4,009 ) (4,009 ) (3,859 )lossesLoans, net 377,844 328,167 338,407 329,611 246,494

Premises and 12,767 11,581 10,992 11,095 11,180 equipment, netOther assets 13,974 12,724 12,577 11,882 11,330

Total assets $ 537,232 $ 497,830 $ 485,285 $ 458,823 $ 323,426

LIABILITIESDeposits:Demand $ 126,481 $ 108,147 $ 103,824 $ 96,395 $ 58,357 noninterest-bearingDemand 122,506 108,097 104,819 90,633 51,608 interest-bearingMoney market and 163,232 146,655 87,035 79,550 77,273 savingsTime deposits of 15,812 15,418 21,103 22,925 26,503 less than $100,000Time deposits of 57,299 55,021 54,695 51,919 54,274 $100,000 or moreTotal deposits 485,330 433,338 371,476 341,422 268,015

Borrowings and 5,000 15,000 78,136 83,136 23,000 other obligationsSubordinated 11,703 16,645 4,923 4,920 4,917 debenturesInterest payable 3,776 2,763 1,854 1,765 1,382 and otherliabilitiesTotal liabilities 505,809 467,746 456,389 431,243 297,314

SHAREHOLDERS'EQUITYCommon stock 14,681 14,584 15,462 15,440 15,336

Retained Earnings 17,183 15,136 13,077 11,841 10,557

Accumulated other (441 ) 364 357 299 219 comprehensiveincome (loss)Total shareholders' 31,423 30,084 28,896 27,580 26,112 equityTotal liabilities $ 537,232 $ 497,830 $ 485,285 $ 458,823 $ 323,426 and shareholders'equity Total equity / 5.85 % 6.04 % 5.95 % 6.01 % 8.07 %total assetsBook value per $ 21.65 $ 20.87 $ 19.38 $ 18.50 $ 17.63 shareShares outstanding 1,451,091 1,441,241 1,491,041 1,491,041 1,481,041

CORNERSTONE COMMUNITY BANCORPCONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)(Dollars in Thousands)Three months ended03/31/2112/31/2003/31/20INTEREST INCOMELoans$

4,451

$

4,761

$

3,356

Federal funds sold2

2

17

Investment securities162

162

90

Other32

51

45

Total interest income4,647

4,976

3,508

INTEREST EXPENSEDeposits:Interest-bearing demand47

55

35

Money market and savings87

80

186

Time deposits124

155

331

Other172

221

114

Total interest expense430

511

666

Net interest income4,217

4,465

2,842

Provision for credit losses400

-

1,450

Net interest income after provisionfor credit losses3,817

4,465

1,392

NON-INTEREST INCOMEService charges on deposit accounts58

55

72

Gain on sale of loans700

61

186

Gain (loss) on sale of other real estate owned-

-

-

Gain (loss) on sale of securities(45

)

-

-

Other non-interest income164

229

136

Total non-interest income877

345

394

OPERATING EXPENSESSalaries and benefits679

970

939

Premises and fixed assets179

182

252

Other956

757

707

Total operating expenses1,814

1,909

1,898

Income before income taxes2,880

2,901

(112

)

Income taxes834

842

(159

)

NET INCOME$

2,046

$

2,059

$

47

EARNINGS PER SHAREBasic earnings per share$

1.41

$

1.39

$

0.03

Diluted earnings per share$

1.38

$

1.36

$

0.03

Average common shares outstanding1,447,763

1,477,361

1,480,668

Average common and equivalentshares outstanding1,485,953

1,511,365

1,532,685

PERFORMANCE MEASURESReturn on average assets1.56

%

1.68

%

0.06

%

Return on average equity26.41

%

27.70

%

0.71

%

Tax-equivalent net interest margin3.43

%

3.81

%

4.09

%

Efficiency ratio35.61

%

39.69

%

58.65

%

View source version on businesswire.com: https://www.businesswire.com/news/home/20210413005997/en/

CONTACT: Jeffrey P. Finck President & CEO 530.222.1460 Patrick E. Phelan Chief Financial Officer 530.222.1460