Welcome!

Microsoft Cloud Authors: Lori MacVittie, Elizabeth White, Yeshim Deniz, Serafima Al, Janakiram MSV

News Feed Item

Focus Business Bank Announces Unaudited Financial Results for December 31, 2013

SAN JOSE, CA -- (Marketwired) -- 02/05/14 -- Focus Business Bank (OTCQB: FCSB) announced unaudited financial results for the quarter and year ended December 31, 2013. Net income for the quarter was $315,000, or $0.11 per diluted share. For the year ended December 31, 2013, net income was $870,000, or $0.30 per diluted share, compared to $3,458,000, or $1.19 per diluted share, for the year ended December 31, 2012. The changes in net income for the quarter and year ended December 31, 2013 compared to the same periods in 2012 are primarily attributable to the reversal of the Bank's deferred tax asset in late 2012. Pre-tax income of $575,000 and $1,368,000 for the quarter and year ended December 31, 2013 increased 53% and 7%, respectively, compared to pre-tax income of $375,000 and $1,284,000 in the prior year quarter and annual periods. The primary contributors to the growth in pre-tax income were increases in net interest income and non-interest income which were partially offset by increased personnel and infrastructure growth.

President and Chief Executive Officer Richard L. Conniff commented on the December 31, 2013 results, "The Bank experienced outstanding growth in earning assets and deposits in 2013. Over the past five years, the Bank has committed heavily to growing its specialty businesses, cash management services for condominium homeowner associations and public benefit companies, both of which are significant sources of deposits. In addition to the strong growth in deposits from these specialty businesses, we also experienced growth in our core business banking lines resulting in loan growth and additional deposits. While the growth required an investment in personnel and other infrastructure, the Bank is now well positioned to benefit from the recurring long-term revenue generated by this larger base of earning assets."

Highlights of the year ended December 31, 2013

  • Non-interest bearing deposits of $94.7 million at December 31, 2013 represent a 50% increase over December 31, 2012 and a record high level. Non-interest bearing deposits reflect the growth in business banking relationships.

  • Interest bearing deposits of $190.4 million represent a 54% increase over December 31, 2012 and a record high level. The increase is primarily related to growth in the Bank's specialty businesses.

  • Total loans of $140.3 million at December 31, 2013 were 18% above December 31, 2012 and a record high level.

  • Net interest income of $6.8 million for the year ended December 31, 2013 represented 12% growth over the year ended December 31, 2012.

  • Net income after taxes was $870,000 for the year ended December 31, 2013. Pre-tax net income of $1.4 million for the year was a record high.

Assets and Liabilities

Investment securities of $63.3 million have grown 116% since December 31, 2012 and interest bearing balances with other banks have grown 504% over that same period. The growth in investments and interest bearing balances with other banks has been funded primarily by increased core deposits.

The growth in deposits in 2013 was extraordinary and related, in part, to changing market conditions including opportunities following a competitor's sale of a competing business line to another bank. The timing of these market events has resulted in a very liquid balance sheet at December 31, 2013.

While the Bank was successful growing loans by 18%, the pace of growth in deposits was much higher. The loan to deposit ratio at December 31, 2013 is 49% compared to 64% at December 31, 2012. The Bank added to its lending and business development staff in 2013 and expects those investments to increase loan originations and the loan to deposit ratio in the future. At December 31, 2013, the Bank's loan portfolio is a mix of commercial and industrial loans and commercial real estate loans, primarily to businesses in Santa Clara County.

Net Interest Income

Net interest income for the quarter and year ended December 31, 2013 grew significantly over the same periods ending December 31, 2012. The increase in net interest income was directly related to the higher volume of earning assets. The increase in net interest income was partially offset by a lower net interest margin related to the mix of earning assets with a significantly higher proportion of earning assets being in lower yielding investments and interest bearing deposits with other banks. Short term market interest rates also remain at historically low levels.

Non-interest Income

Non-interest income was $1,578,000 for the year ended December 31, 2013 compared to $1,159,000 for the year ended December 31, 2012. Non-interest income for both annual periods consisted primarily of gains on the sale of SBA loans, a core business of the Bank, which totaled $1,158,000 and $717,000, for 2013 and 2012, respectively. Other non-interest income includes service charges and income from the servicing of loans sold in the secondary market.

Non-Interest Expense

Non-interest expense for 2013 was $7,013,000 compared to $5,964,000 for 2012. The increase in operating expenses is primarily the result of investments in personnel, marketing and infrastructure to support the Bank's substantial growth in earning assets and low cost deposits. The number of full-time equivalent employees at December 31, 2013 was 32 compared to 28 at December 31, 2012.

Asset Quality

The Bank had no loan charge-offs in 2012 or 2013 and made no provision for loan losses in those years. The allowance for loan losses was 1.82% of total loans at December 31, 2013 compared to 2.13% at December 31, 2012. At December 31, 2013, the Bank had two loans totaling $1.1 million which were not performing in accordance with their contractual loan terms but were considered by management to be in the process of collection. Both loans were originated under the United States Small Business Administration (SBA) 7a loan program and, therefore, have guarantees from the SBA associated with them.

Capital

Focus Business Bank has capital ratios in excess of the minimum regulatory requirements for a bank to be considered well capitalized. At December 31, 2013, the total risk-based capital ratio was 14.84% compared to the regulatory well capitalized minimum of 10%. The Bank has not participated in any government sponsored capital programs, including the Troubled Asset Relief Program ("TARP") or the Small Business Lending Fund ("SBLF").

About Focus Business Bank

Focus Business Bank is dedicated to meeting the banking needs of closely-held businesses and professionals in Santa Clara County. The Bank's office is located at 10 Almaden Boulevard in downtown San Jose, California and offers a variety of commercial banking products including loans, deposits, remote deposit capture and other cash management services oriented toward closely-held businesses and their owners. The Bank specializes in commercial loans and is also an SBA Preferred Lender. The Bank also serves not-for-profit businesses and condominium homeowner associations by offering expertise, market knowledge and specialized products and services to these customers.

Forward-Looking Statements

This release may contain forward-looking statements, such as, among others, statements about plans, expectations and goals concerning future growth and performance. Forward-looking statements are subject to risks and uncertainties. Such risks and uncertainties may include but are not necessarily limited to fluctuations in interest rates, inflation, government regulations and general economic conditions, including the real estate market in California and other factors beyond the Bank's control. Such risks and uncertainties could cause results for subsequent interim periods or for the entire year to differ materially from those indicated. Readers should not place undue reliance on the forward-looking statements, which reflect management's view only as of the date hereof. The Bank undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances.

                            Focus Business Bank
                  Unaudited Summary Financial Information


                                               As of
                                  -------------------------------
                                                                   12 Month
BALANCE SHEET                     31-Dec-13  30-Sep-13  31-Dec-12  % Change
                                  ---------  ---------  ---------  --------
($ in ',000s except per share
 data)
ASSETS
Cash and due from banks
  Interest bearing                $  61,323  $  50,312  $  52,560        17%
  Non-interest bearing               41,668     42,467      6,895       504%
Federal funds sold                      501        505        505        -1%
Investment securities                63,293     47,602     29,368       116%
Loans                               140,342    134,315    119,415        18%
  Allowance for loan losses          (2,548)    (2,547)    (2,545)        0%
                                  ---------  ---------  ---------
    Net Loans                       137,794    131,768    116,870        18%
Other assets                          8,080      8,257      7,237        12%
                                  ---------  ---------  ---------

TOTAL ASSETS                      $ 312,659  $ 280,911  $ 213,435        46%
                                  =========  =========  =========

LIABILITIES
Deposits
  Non-interest bearing            $  94,661  $  80,980  $  63,065        50%
  Interest bearing                  190,354    172,509    123,295        54%
                                  ---------  ---------  ---------
    Total deposits                  285,015    253,489    186,360        53%
Other liabilities                       975      1,035        880        11%
                                  ---------  ---------  ---------
TOTAL LIABILITIES                   285,990    254,524    187,240        53%
Stockholders' equity                 26,695     26,387     26,195         2%
                                  ---------  ---------  ---------

LIABILITIES AND STOCKHOLDERS'
 EQUITY                           $ 312,685  $ 280,911  $ 213,435        47%
                                  =========  =========  =========
Book value/share                  $    9.10  $    9.00  $    8.97         1%

Balance Sheet Ratios
  Loan/deposit                           49%        53%        64%
  Non-interest/total deposit             33%        32%        34%

Regulatory Capital Ratios
  Tier-1 leverage                      8.50%      9.12%     11.77%
  Tier-1 risk based capital           13.58%     14.04%     16.81%
  Total risk-based capital            14.84%     15.30%     18.07%

Asset Quality Metrics
  Non-performing loans            $   1,098  $       -  $       -
  Non-performing loans/total
   loans                               0.78%      0.00%      0.00%
  ALLL/total loans                     1.82%      1.90%      2.13%



                            Focus Business Bank
              Unaudited Summary Financial Information (cont.)


                                    Quarters Ended          Year Ended
                                 --------------------  --------------------
INCOME STATEMENT                 31-Dec-13  31-Dec-12  31-Dec-13  31-Dec-12
                                 ---------  ---------  ---------  ---------
($ in ',000s except per share
 data)
Interest income                  $   2,067  $   1,769  $   7,445  $   6,531
Interest expense                       175        123        642        442
                                 ---------  ---------  ---------  ---------
  Net interest income                1,892      1,646      6,803      6,089
Provision for loan losses                -          -          -          -
Non-interest income                    535        421      1,578      1,159
Non-interest expense                 1,852      1,692      7,013      5,964
                                 ---------  ---------  ---------  ---------
  Pre-tax income (loss)                575        375      1,368      1,284
  Income taxes                         260        (16)       498     (2,174)
                                 ---------  ---------  ---------  ---------
Net income                       $     315  $     391  $     870  $   3,458
                                 =========  =========  =========  =========
Net income per diluted share     $    0.11  $    0.13  $    0.30  $    1.19

Performance Metrics
  Net interest margin                 2.68%      3.35%      2.80%      3.60%
  Return on average assets            0.42%      0.75%      0.33%      1.95%
  Return on average equity            4.65%      5.98%      3.28%     14.47%

Contact:
Richard L. Conniff
President and Chief Executive Officer
408.200.8701
Email Contact

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

@ThingsExpo Stories
Cloud-enabled transformation has evolved from cost saving measure to business innovation strategy -- one that combines the cloud with cognitive capabilities to drive market disruption. Learn how you can achieve the insight and agility you need to gain a competitive advantage. Industry-acclaimed CTO and cloud expert, Shankar Kalyana presents. Only the most exceptional IBMers are appointed with the rare distinction of IBM Fellow, the highest technical honor in the company. Shankar has also receive...
Business professionals no longer wonder if they'll migrate to the cloud; it's now a matter of when. The cloud environment has proved to be a major force in transitioning to an agile business model that enables quick decisions and fast implementation that solidify customer relationships. And when the cloud is combined with the power of cognitive computing, it drives innovation and transformation that achieves astounding competitive advantage.
Personalization has long been the holy grail of marketing. Simply stated, communicate the most relevant offer to the right person and you will increase sales. To achieve this, you must understand the individual. Consequently, digital marketers developed many ways to gather and leverage customer information to deliver targeted experiences. In his session at @ThingsExpo, Lou Casal, Founder and Principal Consultant at Practicala, discussed how the Internet of Things (IoT) has accelerated our abilit...
In his session at Cloud Expo, Alan Winters, U.S. Head of Business Development at MobiDev, presented a success story of an entrepreneur who has both suffered through and benefited from offshore development across multiple businesses: The smart choice, or how to select the right offshore development partner Warning signs, or how to minimize chances of making the wrong choice Collaboration, or how to establish the most effective work processes Budget control, or how to maximize project result...
To get the most out of their data, successful companies are not focusing on queries and data lakes, they are actively integrating analytics into their operations with a data-first application development approach. Real-time adjustments to improve revenues, reduce costs, or mitigate risk rely on applications that minimize latency on a variety of data sources. In his session at @BigDataExpo, Jack Norris, Senior Vice President, Data and Applications at MapR Technologies, reviewed best practices to ...
Data is the fuel that drives the machine learning algorithmic engines and ultimately provides the business value. In his session at Cloud Expo, Ed Featherston, a director and senior enterprise architect at Collaborative Consulting, discussed the key considerations around quality, volume, timeliness, and pedigree that must be dealt with in order to properly fuel that engine.
"Akvelon is a software development company and we also provide consultancy services to folks who are looking to scale or accelerate their engineering roadmaps," explained Jeremiah Mothersell, Marketing Manager at Akvelon, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
In his keynote at 19th Cloud Expo, Sheng Liang, co-founder and CEO of Rancher Labs, discussed the technological advances and new business opportunities created by the rapid adoption of containers. With the success of Amazon Web Services (AWS) and various open source technologies used to build private clouds, cloud computing has become an essential component of IT strategy. However, users continue to face challenges in implementing clouds, as older technologies evolve and newer ones like Docker c...
Two weeks ago (November 3-5), I attended the Cloud Expo Silicon Valley as a speaker, where I presented on the security and privacy due diligence requirements for cloud solutions. Cloud security is a topical issue for every CIO, CISO, and technology buyer. Decision-makers are always looking for insights on how to mitigate the security risks of implementing and using cloud solutions. Based on the presentation topics covered at the conference, as well as the general discussions heard between sessio...
To Really Work for Enterprises, MultiCloud Adoption Requires Far Better and Inclusive Cloud Monitoring and Cost Management … But How? Overwhelmingly, even as enterprises have adopted cloud computing and are expanding to multi-cloud computing, IT leaders remain concerned about how to monitor, manage and control costs across hybrid and multi-cloud deployments. It’s clear that traditional IT monitoring and management approaches, designed after all for on-premises data centers, are falling short in ...
Organizations planning enterprise data center consolidation and modernization projects are faced with a challenging, costly reality. Requirements to deploy modern, cloud-native applications simultaneously with traditional client/server applications are almost impossible to achieve with hardware-centric enterprise infrastructure. Compute and network infrastructure are fast moving down a software-defined path, but storage has been a laggard. Until now.
DXWorldEXPO LLC announced today that the upcoming DXWorldEXPO | CloudEXPO New York event will feature 10 companies from Poland to participate at the "Poland Digital Transformation Pavilion" on November 12-13, 2018.
Digital Transformation is much more than a buzzword. The radical shift to digital mechanisms for almost every process is evident across all industries and verticals. This is often especially true in financial services, where the legacy environment is many times unable to keep up with the rapidly shifting demands of the consumer. The constant pressure to provide complete, omnichannel delivery of customer-facing solutions to meet both regulatory and customer demands is putting enormous pressure on...
The best way to leverage your CloudEXPO | DXWorldEXPO presence as a sponsor and exhibitor is to plan your news announcements around our events. The press covering CloudEXPO | DXWorldEXPO will have access to these releases and will amplify your news announcements. More than two dozen Cloud companies either set deals at our shows or have announced their mergers and acquisitions at CloudEXPO. Product announcements during our show provide your company with the most reach through our targeted audienc...
In an era of historic innovation fueled by unprecedented access to data and technology, the low cost and risk of entering new markets has leveled the playing field for business. Today, any ambitious innovator can easily introduce a new application or product that can reinvent business models and transform the client experience. In their Day 2 Keynote at 19th Cloud Expo, Mercer Rowe, IBM Vice President of Strategic Alliances, and Raejeanne Skillern, Intel Vice President of Data Center Group and ...
More and more brands have jumped on the IoT bandwagon. We have an excess of wearables – activity trackers, smartwatches, smart glasses and sneakers, and more that track seemingly endless datapoints. However, most consumers have no idea what “IoT” means. Creating more wearables that track data shouldn't be the aim of brands; delivering meaningful, tangible relevance to their users should be. We're in a period in which the IoT pendulum is still swinging. Initially, it swung toward "smart for smart...
DXWorldEXPO LLC announced today that All in Mobile, a mobile app development company from Poland, will exhibit at the 22nd International CloudEXPO | DXWorldEXPO. All In Mobile is a mobile app development company from Poland. Since 2014, they maintain passion for developing mobile applications for enterprises and startups worldwide.
@DevOpsSummit at Cloud Expo, taking place November 12-13 in New York City, NY, is co-located with 22nd international CloudEXPO | first international DXWorldEXPO and will feature technical sessions from a rock star conference faculty and the leading industry players in the world.
In his keynote at 19th Cloud Expo, Sheng Liang, co-founder and CEO of Rancher Labs, discussed the technological advances and new business opportunities created by the rapid adoption of containers. With the success of Amazon Web Services (AWS) and various open source technologies used to build private clouds, cloud computing has become an essential component of IT strategy. However, users continue to face challenges in implementing clouds, as older technologies evolve and newer ones like Docker c...
DXWorldEXPO LLC announced today that ICC-USA, a computer systems integrator and server manufacturing company focused on developing products and product appliances, will exhibit at the 22nd International CloudEXPO | DXWorldEXPO. DXWordEXPO New York 2018, colocated with CloudEXPO New York 2018 will be held November 11-13, 2018, in New York City. ICC is a computer systems integrator and server manufacturing company focused on developing products and product appliances to meet a wide range of ...