CBOA Financial, Inc. Reports Consolidated Earnings of $1,005,000 in 3Q 2022


TUCSON, Ariz., Oct. 26, 2022 /PRNewswire/ — CBOA Financial, Inc. (OTCMKTS:CBOF) (the “Company”), parent company of Commerce Bank of Arizona (the “Bank” or “CBAZ”), announced that consolidated net income for quarter ending September 30, 2022 increased 34% to $1 million, from $747 thousand in the second quarter of this year.

President and CEO Chris Webster stated, “Another solid performance for Commerce Bank of Arizona during the third quarter. Excellent net loan growth and the Bank’s increasing net interest margin supported strong earnings growth.” Webster also said, “Our customers continue to work through the challenges of inflation and the Fed’s interest rising rate policy. We continue to maintain a sharp focus on portfolio management. The Bank’s commercial loan portfolio performance metrics remain at very acceptable levels.”

Third Quarter 2022 Highlights

  • $23 million in new loans funded during the quarter
  • Interest Income increased 15% compared to last quarter
  • Non-Interest Income increased 22% compared to last quarter

Operational Highlights

Year-to-date net loan growth was $28.3 million. The Bank’s Net Interest Margin increased to 4.41% for the third quarter. The Efficiency Ratio also improved to 66.6%. Year-over-year, non-performing assets which includes OREO are down 87% from $1.5 million or 0.4% of assets to $189 thousand or 0.05% of assets.

Balance Sheet

Total assets increased by 2.4% to $372.4 million during the quarter ended September 30, 2022, and increased 9.4% compared to $340.4 million a year ago.

Gross loans increased $17.2 million year-over-year, ending the third quarter 2022 at $254 million. Total deposits increased by 3.1% to $338 million during the quarter and increased 11.4% compared to $303 million a year ago.

The Allowance for Loan Losses totaled $3.7 million at September 2022, or 1.46% of loans, up slightly from the previous quarter.

Shareholders’ equity decreased to $26.5 million at September 30, 2022, from $26.6 million the preceding quarter due to an increase in unrealized losses on securities. At September 30, 2022, tangible book value was $2.71 per share compared to $2.79 per share at June 30, 2022 and $2.96 per share a year ago. The Bank’s September 2022 Tier 1 Leverage ratio was 9.40%, compared to 9.45% at September 30, 2021.

Capital Management

Capital ratios exceeded regulatory guidelines for a well-capitalized institution under Basel III and Dodd Frank Wall Street Reform requirements at September 30, 2022 as well as during the first and second quarters of 2022. Capital ratios are presented below.

About the Company

Commerce Bank of Arizona, established in 2002 in Tucson, Arizona, is a full-service community bank that caters to small-to mid-sized businesses and real estate professionals. CBAZ offers commercial clients with a variety of services ranging from U.S. Small Business Administration (SBA) financing solutions, construction loans, and commercial real estate loans. CBOA Financial, Inc. is a single-bank holding company and parent of the Bank. The Company is traded over-the-counter as CBOF. For additional information, please visit: www.commercebankaz.com.

Forward-looking Statements

This press release may include forward-looking statements about CBOA Financial, Inc. or Commerce Bank of Arizona. These statements involve certain risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Such risks and uncertainties include, but are not limited to, the following factors: competition, fluctuations in interest rates, dependency on key individuals, loan defaults, geographical concentration, litigation and changes in federal laws, regulations and interpretations thereof. All forward-looking statements included in this press release are based on information available at the time of the release, and CBOA Financial, Inc. and Commerce Bank of Arizona assume no obligation to update any forward-looking statement.

 

Unaudited Consolidated Summary Financial Information

Dollars in thousands – Unaudited


For the quarter ended


 Year to Date 


9/30/2022

6/30/2022

9/30/2021


9/30/2022

9/30/2021

Summary Income Data





Interest Income


4,134

3,608

3,884


11,050

10,670

Interest expense


174

148

174


462

674

Net Interest Income


3,960

3,460

3,710


10,588

9,996

Provision for (reduction in) loan losses


146


37

339

Non-interest income


106

87

74


645

228

Realized gains (losses) on sales of securities


2


2

Non-interest expense


2,709

2,540

2,424


7,954

7,388

Income (loss) before income taxes


1,357

1,007

1,214


3,242

2,499

Provision for income tax


352

260

704


840

152

Net Income


1,005

747

510


2,402

2,347









Per Share Data








Shares outstanding end-of-period


9,759

9,555

8,911


9,759

8,911

Earnings per common share ($’s)


0.10

0.08

0.06


0.25

0.26

Earnings per common share (Diluted) ($’s)


0.10

0.07

0.05


0.23

0.25

Cash dividend declared



Total shareholders’ equity


26,461

26,641

28,233


26,461

28,233

Tangible Book value per share ($’s)


2.71

2.79

2.96


2.71

2.96









Selected Balance Sheet Data








Total assets


372,386

363,548

340,373


372,386

340,373

Securities available-for-sale


62,317

63,027

44,356


62,317

44,356

Loans


254,458

256,905

237,234


254,458

237,234

Allowance for loan losses


3,703

3,702

3,160


3,703

3,160

Deposits


337,631

327,574

302,994


337,631

302,994

Other borrowings



Shareholders’ equity


26,461

26,641

28,233


26,461

28,233









Performance Ratios (%)








Return on avg shareholders’ equity


15.09

11.22

9.20


10.56

9.20

Net interest margin (Bank)


4.41

4.02

4.01


4.11

4.01

Efficiency ratio (Bank)


66.63

71.61

71.06


70.81

71.06









Asset Quality Data (%)








Nonperforming assets to total assets 


0.05

0.08

0.40


0.05

0.40

Reserve for loan losses to total loans 


1.46

1.44

1.33


1.46

1.33

Net Charge-offs to avg loans for period


0.05


(0.14)

0.05









Regulatory Capital Ratios (%)








Common Equity Tier 1 


11.57

11.30

12.90


11.57

12.90

Tier 1 risk-based capital ratio 


11.57

11.30

12.90


11.57

12.90

Total risk-based capital ratio 


12.82

12.55

14.12


12.82

14.12

Tier 1 leverage capital ratio 


9.40

9.62

9.45


9.40

9.45

 

Contact:

Chris Webster

President & CEO

480-253-4511

cwebster@commercebankaz.com

 

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SOURCE Commerce Bank of Arizona

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