Business Wire | Jan 20, 2022 03:11PM EST

Cornerstone Community Bancorp Reports Financial Results For the Fourth Quarter and Full Year Ended December 31, 2021

Jan. 20, 2022

RED BLUFF, Calif.--(BUSINESS WIRE)--Jan. 20, 2022--Cornerstone Community Bancorp (OTC Pink: CRSB) announced today its financial results for the fourth quarter and full year ended December 31, 2021.

The Company reported net income of $1,967,000 for the three months ended December 31, 2021 compared to net income of $2,059,000 for the same period last year. Diluted earnings per share were $1.29 for the three months ended December 31, 2021 compared to $1.36 for the same period last year.

The return on average assets for the three months ended December 31, 2021 was 1.41% and the return on average equity was 21.63%. The tax-equivalent net interest margin was 3.59% for the three months ended December 31, 2021 compared to 3.81% for the same period last year and the efficiency ratio was 43.43% for the three months ended December 31, 2021 compared to 39.69% for the same period last year.

For the year ended December 31, 2021, the Company reported record net income of $7,915,000 compared to net income of $4,626,000 for the same period last year. Diluted earnings per share were $5.25 for the year ended December 31, 2021 compared to $3.04 for the same period last year.

The return on average assets for the year ended December 31, 2021 was 1.46% and the return on average equity was 23.35%.

President and CEO, Jeff Finck stated, "We are very pleased with our 2021 results. Loans and deposits grew at a strong pace. We look forward to 2022 with the opening of our Anderson branch in the first quarter."

Net Interest Income

Net interest income increased to $4,781,000 for the quarter ended December 31, 2021 compared to $4,465,000 for the same quarter last year. For the year ended December 31, 2021, net interest income increased to $17,993,000 compared to $13,836,000 for the same period last year.

Provision for credit losses

Provision for credit losses were $150,000 for the quarter ended December 31, 2021 compared to no provision for the same quarter last year. For the year ended December 31, 2021, the Company recorded a $1,050,000 provision for credit losses compared to $1,600,000 for the same period last year.

Non-Interest Income

Non-interest income for the quarter ended December 31, 2021 was $365,000 compared to $345,000 for the quarter ended December 31, 2020. For the year ended December 31, 2021, non-interest income was $2,378,000 compared to $1,239,000 for the same period last year.

Non-Interest Expense

Non-interest expense was $2,235,000 for the quarter ended December 31, 2021 compared to $1,909,000 for the same period last year. For the year ended December 31, 2021, non-interest expense was $8,200,000 compared to $7,156,000 for the same period last year.

Balance Sheet

Total loans, net of unearned income at December 31, 2021 were $387.4 million compared to $332.2 million at December 31, 2020.

Total deposits were $547.7 million at December 31, 2021 compared to total deposits of $433.3 million at December 31, 2020.

Credit Quality

The allowance for loan losses was $5,059,000, or 1.31% of loans, net of unearned income at December 31, 2021, compared to $4,009,000, or 1.21% of loans, net of unearned income at December 31, 2020. There were no nonperforming assets at December 31, 2021 and December 31, 2020.

Capital

At December 31, 2021, shareholders' equity totaled $37.0 million compared to $30.1 million at December 31, 2020. Book value was $25.31 per share at December 31, 2021 compared to $20.87 per share at December 31, 2020.

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.

CORNERSTONECOMMUNITY BANCORPCONSOLIDATED BALANCE SHEETS(UNAUDITED)(Dollars inThousands) 12/31/21 09/30/21 06/30/21 03/31/21 12/31/20 ASSETSCash and due from $ 4,552 $ 4,765 $ 5,450 $ 5,417 $ 3,811 banksFederal funds sold 121 2,600 2,256 5,761 14,166

Interest-bearing 77,933 24,636 28,549 68,283 77,045 depositsInvestment 108,253 110,470 75,258 52,084 50,336 securitiesLoans held for sale - - - 1,102 -

Loans, net of 387,374 388,532 390,748 382,253 332,176 unearned incomeAllowance for loan (5,059 ) (4,909 ) (4,509 ) (4,409 ) (4,009 )lossesLoans, net 382,315 383,623 386,239 377,844 328,167

Premises and 14,488 13,567 13,013 12,767 11,581 equipment, netOther assets 15,622 14,863 14,972 13,974 12,724

Total assets $ 603,284 $ 554,524 $ 525,737 $ 537,232 $ 497,830

LIABILITIESDeposits:Demand $ 174,282 $ 141,734 $ 126,107 $ 126,481 $ 108,147 noninterest-bearingDemand 131,368 131,964 126,724 122,506 108,097 interest-bearingMoney market and 163,946 150,149 150,086 163,232 146,655 savingsTime deposits of 13,662 13,180 13,393 15,812 15,418 less than $100,000Time deposits of 64,449 63,111 56,993 57,299 55,021 $100,000 or moreTotal deposits 547,707 500,138 473,303 485,330 433,338

Borrowings and 5,000 5,000 5,000 5,000 15,000 other obligationsSubordinated 11,720 11,715 11,709 11,703 16,645 debenturesInterest payable 1,838 2,151 1,933 3,776 2,763 and otherliabilitiesTotal liabilities 566,265 519,004 491,945 505,809 467,746

SHAREHOLDERS'EQUITYCommon stock 14,913 14,814 14,771 14,681 14,584

Retained Earnings 23,051 21,084 18,999 17,183 15,136

Accumulated other (945 ) (378 ) 22 (441 ) 364 comprehensiveincome (loss)Total shareholders' 37,019 35,520 33,792 31,423 30,084 equityTotal liabilities $ 603,284 $ 554,524 $ 525,737 $ 537,232 $ 497,830 and shareholders'equity Total equity / 6.14 % 6.41 % 6.43 % 5.85 % 6.04 %total assetsBook value per $ 25.31 $ 24.37 $ 23.22 $ 21.65 $ 20.87 shareShares outstanding 1,462,591 1,457,591 1,455,091 1,451,091 1,441,241

CORNERSTONE COMMUNITY BANCORPCONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)(Dollars in Thousands)Three months endedYear ended12/31/2109/30/2112/31/2012/31/2112/31/20INTEREST INCOMELoans$

4,759

$

4,772

$

4,761

$

18,361

$

15,424

Federal funds sold1

-

2

4

24

Investment securities385

360

162

1,124

495

Other60

35

51

180

174

Total interest income5,205

5,167

4,976

19,669

16,117

INTEREST EXPENSEDeposits:Interest-bearing demand49

46

55

187

181

Money market and savings109

96

80

385

464

Time deposits107

107

155

452

944

Other159

162

221

652

692

Total interest expense424

411

511

1,676

2,281

Net interest income4,781

4,756

4,465

17,993

13,836

Provision for credit losses150

400

-

1,050

1,600

Net interest income after provision for credit losses4,631

4,356

4,465

16,943

12,236

NON-INTEREST INCOMEService charges on deposit accounts65

62

55

244

222

Gain on sale of loans-

396

61

1,231

247

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

-

-

-

-

Gain (loss) on sale of securities-

-

-

(45

)

91

Other non-interest income300

256

229

948

679

Total non-interest income365

714

345

2,378

1,239

OPERATING EXPENSESSalaries and benefits1,175

1,048

970

3,870

3,280

Premises and fixed assets192

212

182

782

891

Other868

877

757

3,548

2,985

Total operating expenses2,235

2,137

1,909

8,200

7,156

Income before income taxes2,761

2,933

2,901

11,121

6,319

Income taxes794

848

842

3,206

1,693

NET INCOME$

1,967

$

2,085

$

2,059

$

7,915

$

4,626

EARNINGS PER SHAREBasic earnings per share$

1.35

$

1.43

$

1.39

$

5.44

$

3.12

Diluted earnings per share$

1.29

$

1.38

$

1.36

$

5.25

$

3.04

Average common shares outstanding1,459,667

1,456,531

1,477,361

1,454,507

1,483,575

Average common and equivalent shares outstanding1,518,908

1,512,738

1,511,365

1,507,561

1,522,714

PERFORMANCE MEASURESReturn on average assets1.41

%

1.53

%

1.68

%

1.46

%

1.09

%

Return on average equity21.63

%

23.52

%

27.70

%

23.35

%

16.53

%

Tax-equivalent net interest margin3.59

%

3.66

%

3.81

%

3.50

%

3.45

%

Efficiency ratio43.43

%

39.07

%

39.69

%

40.25

%

47.47

%

View source version on businesswire.com: https://www.businesswire.com/news/home/20220120005959/en/

CONTACT: Jeffrey P. Finck President & CEO 530.222.1460

CONTACT: Patrick E. Phelan Chief Financial Officer 530.222.1460