SAN JOSE, CA / ACCESSWIRE / January 30, 2023 / Avidbank Holdings, Inc. (OTC PINK:AVBH) announced income for the fourth quarter of 2022 of $8.4 million, or $1.13 per diluted share, compared to $7.0 million, or $0.95 per diluted share, for the third quarter of 2022 and $2.5 million, or $0.42 per diluted share, for the fourth quarter of 2021.
Fourth Quarter 2022 Financial Highlights
- Diluted earnings per share of $1.13 increased $0.18, or 76% annualized, compared to the third quarter of 2022, and increased $0.71, or 169%, compared to the fourth quarter of 2021.
- Return on average assets improved to 1.61%, compared to 1.38% in the third quarter of 2022 and 0.49% in the fourth quarter of 2021.
- Taxable equivalent net interest margin increased to 4.41% in the fourth quarter of 2022, compared to 4.07% in the third quarter of 2022 and 2.90% in the fourth quarter of 2021.
- Efficiency ratio improved to 45.42%, compared to 48.00% in the third quarter of 2022 and 58.31% in the fourth quarter of 2021.
- Loans increased $162 million, or 46% annualized, from September 30, 2022.
- Annualized net charge-offs to average loans totaled 0.00% for the fourth quarter.
2022 Full Year Financial Highlights
- Diluted earnings per share of $3.55, increased 76% compared to 2021. Net income totaled $25.0 million, an increase of 104% compared to 2021.
- Return on average assets improved to 1.21%, compared to 0.72% in 2021.
- Taxable equivalent net interest margin increased to 3.78% compared to 3.12% in 2021.
- Efficiency ratio improved to 51.80%, compared to 63.21% in 2021.
- Loans increased $331 million, or 27%, from December 31, 2021.
- Annualized net charge-offs to average loans totaled 0.01% for the full year of 2022.
"Our strong performance for 2022 continued in the fourth quarter with solid loan growth and continued improvement in our overall profitability," said Mark Mordell, Chairman and Chief Executive Officer. "The growth we have achieved along with our increased profitability have us well positioned for 2023," added Mr. Mordell.
Income Statement
Taxable equivalent net interest income totaled $21.8 million for the fourth quarter of 2022, an increase of $2.2 million, or 44% annualized, from the third quarter of 2022, and an increase of $7.5 million, or 53%, from the fourth quarter of 2021. The tax-equivalent net interest margin was 4.41% in the fourth quarter of 2022, an increase of 34 basis points compared to the third quarter of 2022, and an increase of 151 basis points compared to the fourth quarter of 2021. The increase in net interest income and net interest margin were primarily driven by higher interest rates and the growth in average balance of loans.
The yield on loans in the fourth quarter of 2022 was 6.33%, an increase of 83 basis points from the third quarter of 2022 and an increase of 154 basis points from the fourth quarter of 2021. The increase in loan yields was primarily due to increases in the Prime rate. Additionally, to help stabilize our loan yield, we hedged $125 million of our Prime loan portfolio in the fourth quarter of 2022 with receive-fixed interest rate swaps.
The cost of deposits in the fourth quarter of 2022 was 0.90%, an increase of 48 basis points from the third quarter of 2022 and an increase of 76 basis points from the fourth quarter of 2021. The cost of interest-bearing deposits in the fourth quarter of 2022 was 1.59% compared to 0.77% in the third quarter of 2022 and 0.30% in the fourth quarter of 2021.
In the fourth quarter of 2022, we recorded a provision for loan losses of $1.0 million, compared to $0.9 million in the third quarter of 2022 and $3.3 million in the fourth quarter of 2021. The provision in the fourth quarter of 2022 was primarily attributable to the $162 million increase in loan balances.
Non-interest income was $1.3 million in the fourth quarter of 2022 compared to $1.1 million in the third quarter of 2022 and $2.1 million in the fourth quarter of 2021. The fourth quarter of 2022 included $119,000 in warrant and success fee income and $521,000 in other investment income, which was offset by a $404,000 loss on the sale of $15 million in investment securities.
Non-interest expense totaled $10.5 million in the fourth quarter of 2022 compared to $10.0 million in the third quarter of 2022 and $9.5 million in the fourth quarter of 2021. This linked quarter increase was primarily due to an increase in salary and incentive expense, offset by a decrease in the FDIC regulatory assessment. The number of full-time equivalent employees on December 31, 2022, totaled 142 compared to 134 on September 30, 2022.
Balance Sheet
Total assets were $2.13 billion as of December 30, 2022, compared to $1.98 billion on September 30, 2022 and $2.16 billion at December 30, 2021. Cash and cash equivalents were $47 million on December 31, 2022, compared to $37 million on September 30, 2022, and $493 million on December 31, 2021.
Period end loans on December 31, 2022, totaled $1.55 billion, which represented an increase of $162 million, or 46% annualized, from September 30, 2022, and an increase of $331 million, or 27%, from $1.22 billion at December 31, 2021. The growth in loans during the fourth quarter of 2022 included an increase of $134 million in commercial loans. Quarterly average loans for the fourth quarter of 2022 increased $93 million, or 27% annualized, from the third quarter of 2022 and $297 million, or 26%, from the fourth quarter of 2021.
The allowance for loan losses on December 31, 2022, was $16.5 million, representing an increase of $1.0 million from September 30, 2022. The allowance for loan losses to total loans was 1.06% on December 31, 2022, compared to 1.11% on September 30, 2022. Nonperforming loans to total loans was 0.92% on December 31, 2022, compared to 0.01% on September 30, 2022. The increase was due to a downgrade of one $14.1 million construction loan credit relating to a completed condominium project which we have been closely monitoring over the last 18 months. We believe that we are well-collateralized to protect the Bank's position with respect to this credit.
Period end deposits were $1.82 billion on December 31, 2022, compared to $1.81 billion at September 30, 2022 and $1.98 billion at December 31, 2021. Quarterly average deposits for the fourth quarter of 2022 increased $65 million, or 14% annualized, compared to the third quarter of 2022, and increased $17 million, or 1%, from the fourth quarter of 2021.
Noninterest bearing deposits represented 42% of total deposits on December 31, 2022, compared to 44% on September 30, 2022, and 50% on December 31, 2021. The quarterly average loan to deposit ratio was 77% in the fourth quarter of 2022 compared to 75% in the third quarter of 2022 and 62% in the fourth quarter of 2021.
Book value per share was $17.99 on December 31, 2022, an increase of $1.41 compared to $16.58 on September 30, 2022. Total shareholders' equity totaled $137.5 million on December 31, 2022, an increase of $11.1 million compared to September 30, 2022. This included an increase in retained earnings of $8.4 million and a decrease in accumulated other comprehensive loss of $2.0 million.
About Avidbank
Avidbank Holdings, Inc. (OTC Pink: AVBH), headquartered in San Jose, California, offers innovative financial solutions and services. We specialize in commercial & industrial lending, venture lending, structured finance, asset-based lending, sponsor finance, fund finance, and real estate construction and commercial real estate lending. Avidbank provides a different approach to banking. We do what we say.
Forward-Looking Statement:
This news release contains statements that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts, and generally include the words "believes," "plans," "intends," "expects," "opportunity," "anticipates," "targeted," "continue," "remain," "will," "should," "may," or words of similar meaning. While we believe that our forward-looking statements and the assumptions underlying them are reasonably based, such statements and assumptions, are, by their nature subject to risks and uncertainties, and thus could later prove to be inaccurate or incorrect. Accordingly, actual results could materially differ from forward-looking statements for a variety of reasons, including, but not limited to local, regional, national and international economic conditions and events and the impact they may have on us and our customers, and in particular in our market areas; ability to attract deposits and other sources of liquidity; oversupply of property inventory and deterioration in values of California real estate, both residential and commercial; a prolonged slowdown or decline in construction activity; changes in the financial performance and/or condition of our borrowers; changes in the level of non-performing assets and charge-offs; the cost or effect of acquisitions we may make; the effect of changes in laws and regulations (including laws, regulations and judicial decisions concerning financial reform, capital requirements, taxes, banking, securities, employment, executive compensation, insurance, and information security) with which we and our subsidiaries must comply; changes in estimates of future reserve requirements and minimum capital requirements based upon the periodic review thereof under relevant regulatory and accounting requirements; ability to adequately underwrite for our asset based and corporate finance lending business lines; our ability to raise capital; inflation, interest rate, securities market and monetary fluctuations; cyber-security threats including loss of system functionality or theft or loss of data; political instability; acts of war or terrorism, or natural disasters, such as earthquakes, or the effects of a pandemic; destabilization in international economies resulting from the European sovereign debt crisis; the effects of the Tax Cuts and Jobs Act; the timely development and acceptance of new banking products and services and perceived overall value of these products and services by users; changes in consumer spending, borrowing and savings habits; technological changes; the ability to increase market share, retain customers and control expenses; ability to retain and attract key management and personnel; changes in the competitive environment among financial and bank holding companies and other financial service providers; continued volatility in the credit and equity markets and its effect on the general economy; the effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as the Public Company Accounting Oversight Board, the Financial Accounting Standards Board and other accounting standard setters; changes in our organization, management, compensation and benefit plans, and our ability to retain or expand our management team; the costs and effects of legal and regulatory developments including the resolution of legal proceedings or regulatory or other governmental inquiries and the results of regulatory examinations or reviews; our success at managing the risks involved in the foregoing items. We do not undertake, and specifically disclaim any obligation to update any forward-looking statements to reflect occurrences or unanticipated events or circumstances after the date of such statements except as required by law.
Contact: Patrick Oakes
Executive Vice President and Chief Financial Officer
408-200-7390
[email protected]
AVIDBANK HOLDINGS, INC.
Selected Financial Data (Unaudited)
($000, except share and per share amounts)
| For the twelve months ended | ||||||||||||||||||||||||||||
| 2022 | 2021 | December 31, | ||||||||||||||||||||||||||
| Fourth | Third | Second | First | Fourth | ||||||||||||||||||||||||
| Quarter | Quarter | Quarter | Quarter | Quarter | 2022 | 2021 | ||||||||||||||||||||||
| INCOME AND PER SHARE HIGHLIGHTS | ||||||||||||||||||||||||||||
Net income | $ | 8,415 | $ | 7,045 | $ | 5,214 | $ | 4,349 | $ | 2,534 | $ | 25,023 | $ | 12,264 | ||||||||||||||
Basic earnings per share | 1.16 | 0.97 | 0.78 | 0.73 | 0.43 | 3.64 | 2.08 | |||||||||||||||||||||
Diluted earnings per share | 1.13 | 0.95 | 0.76 | 0.71 | 0.42 | 3.55 | 2.02 | |||||||||||||||||||||
Book value per share | 17.99 | 16.58 | 18.27 | 19.20 | 21.91 | 17.99 | 21.91 | |||||||||||||||||||||
PERFORMANCE MEASURES | ||||||||||||||||||||||||||||
Return on average assets | 1.61 | % | 1.38 | % | 1.02 | % | 0.83 | % | 0.49 | % | 1.21 | % | 0.72 | % | ||||||||||||||
Return on average equity | 25.48 | % | 19.36 | % | 16.18 | % | 12.72 | % | 7.25 | % | 18.42 | % | 9.18 | % | ||||||||||||||
Taxable equivalent net interest margin | 4.41 | % | 4.07 | % | 3.62 | % | 3.05 | % | 2.90 | % | 3.78 | % | 3.12 | % | ||||||||||||||
Efficiency ratio | 45.42 | % | 48.00 | % | 53.43 | % | 63.72 | % | 58.31 | % | 51.80 | % | 63.21 | % | ||||||||||||||
Average loans to average deposits | 76.98 | % | 74.61 | % | 66.88 | % | 62.31 | % | 61.75 | % | 70.12 | % | 68.68 | % | ||||||||||||||
CAPITAL | ||||||||||||||||||||||||||||
Tier 1 leverage ratio | 9.46 | % | 9.22 | % | 8.72 | % | 6.85 | % | 6.89 | % | 9.46 | % | 6.89 | % | ||||||||||||||
Common equity tier 1 capital ratio | 9.82 | % | 10.24 | % | 10.17 | % | 9.09 | % | 8.90 | % | 9.82 | % | 8.90 | % | ||||||||||||||
Tier 1 risk-based capital ratio | 9.82 | % | 10.24 | % | 10.17 | % | 9.09 | % | 8.90 | % | 9.82 | % | 8.90 | % | ||||||||||||||
Total risk-based capital ratio | 11.76 | % | 12.31 | % | 12.25 | % | 11.28 | % | 11.11 | % | 11.76 | % | 11.11 | % | ||||||||||||||
Tangible common equity ratio | 6.45 | % | 6.38 | % | 6.90 | % | 5.75 | % | 6.34 | % | 6.45 | % | 6.34 | % | ||||||||||||||
SHARES OUTSTANDING | ||||||||||||||||||||||||||||
Number of common shares outstanding | 7,645,428 | 7,629,767 | 7,585,924 | 6,316,573 | 6,256,682 | 7,645,428 | 6,256,682 | |||||||||||||||||||||
Average common shares | ||||||||||||||||||||||||||||
outstanding - basic | 7,281,343 | 7,274,617 | 6,687,448 | 5,935,948 | 5,904,446 | 6,801,330 | 5,890,216 | |||||||||||||||||||||
Average common shares | ||||||||||||||||||||||||||||
outstanding - diluted | 7,432,670 | 7,410,062 | 6,821,245 | 6,116,306 | 6,101,778 | 6,952,758 | 6,062,482 | |||||||||||||||||||||
ASSET QUALITY | ||||||||||||||||||||||||||||
Allowance for loan losses (ALLL) | ||||||||||||||||||||||||||||
to total loans | 1.06 | % | 1.11 | % | 1.09 | % | 1.08 | % | 1.07 | % | 1.06 | % | 1.07 | % | ||||||||||||||
ALLL to nonperforming loans | 115.70 | % | 10057.14 | % | 9211.32 | % | 407.43 | % | 402.40 | % | 115.70 | % | 402.40 | % | ||||||||||||||
Nonperforming assets to total assets | 0.67 | % | 0.01 | % | 0.01 | % | 0.15 | % | 0.15 | % | 0.67 | % | 0.15 | % | ||||||||||||||
Nonperforming loans to total loans | 0.92 | % | 0.01 | % | 0.01 | % | 0.27 | % | 0.27 | % | 0.92 | % | 0.27 | % | ||||||||||||||
Net charge-offs to total loans | 0.00 | % | 0.01 | % | 0.00 | % | 0.00 | % | 0.25 | % | 0.01 | % | 0.25 | % | ||||||||||||||
AVERAGE BALANCES | ||||||||||||||||||||||||||||
Loans, net of deferred loan fees | $ | 1,450,014 | $ | 1,357,090 | $ | 1,261,255 | $ | 1,213,353 | $ | 1,152,641 | $ | 1,321,177 | $ | 1,052,779 | ||||||||||||||
Investment securities | 459,057 | 505,849 | 487,535 | 436,427 | 287,915 | 472,371 | 222,204 | |||||||||||||||||||||
Total assets | 2,072,887 | 2,028,320 | 2,060,297 | 2,131,587 | 2,054,545 | 2,072,989 | 1,713,888 | |||||||||||||||||||||
Deposits | 1,883,640 | 1,819,008 | 1,888,494 | 1,947,208 | 1,866,704 | 1,884,233 | 1,532,883 | |||||||||||||||||||||
Shareholders' equity | 131,046 | 144,402 | 129,235 | 138,668 | 138,589 | 135,841 | 133,646 | |||||||||||||||||||||
AT PERIOD END | ||||||||||||||||||||||||||||
Loans, net of deferred loan fees | $ | 1,554,222 | $ | 1,392,546 | $ | 1,336,786 | $ | 1,201,934 | $ | 1,223,344 | $ | 1,554,222 | $ | 1,223,344 | ||||||||||||||
Investment securities | 444,664 | 468,239 | 507,826 | 468,917 | 380,170 | 444,664 | 380,170 | |||||||||||||||||||||
Total assets | 2,133,268 | 1,983,822 | 2,010,256 | 2,110,091 | 2,162,478 | 2,133,268 | 2,162,478 | |||||||||||||||||||||
Deposits | 1,823,235 | 1,814,372 | 1,828,752 | 1,947,278 | 1,979,410 | 1,823,235 | 1,979,410 | |||||||||||||||||||||
Shareholders' equity | 137,538 | 126,483 | 138,611 | 121,282 | 137,100 | 137,538 | 137,100 | |||||||||||||||||||||
Avidbank Holdings, Inc.
Consolidated Balance Sheets (Unaudited)
($000)
| December 31, | September 30, | June 30, | March 31, | December 31, | ||||||||||||||||
Assets | 2022 | 2022 | 2022 | 2022 | 2021 | |||||||||||||||
Cash and due from banks | $ | 17,435 | $ | 23,766 | $ | 50,907 | $ | 47,091 | $ | 29,616 | ||||||||||
Due from Federal Reserve Bank | 29,853 | 13,476 | 35,913 | 320,336 | 463,727 | |||||||||||||||
Total cash and cash equivalents | 47,288 | 37,242 | 86,820 | 367,427 | 493,343 | |||||||||||||||
Investment securities - available for sale | 412,993 | 436,535 | 477,646 | 468,917 | 308,170 | |||||||||||||||
Investment securities - held to maturity | 31,671 | 31,704 | 30,180 | - | - | |||||||||||||||
Total investment securities | 444,664 | 468,239 | 507,826 | 468,917 | 380,170 | |||||||||||||||
Loans, net of deferred loan fees | 1,554,222 | 1,392,546 | 1,336,786 | 1,201,934 | 1,223,344 | |||||||||||||||
Allowance for loan losses | (16,481 | ) | (15,488 | ) | (14,646 | ) | (13,054 | ) | (13,054 | ) | ||||||||||
Loans, net of allowance for loan losses | 1,537,741 | 1,377,058 | 1,322,140 | 1,188,880 | 1,210,290 | |||||||||||||||
Bank owned life insurance | 32,747 | 32,522 | 32,303 | 32,087 | 31,875 | |||||||||||||||
Premises and equipment, net | 4,163 | 4,318 | 4,314 | 4,331 | 4,565 | |||||||||||||||
Accrued interest receivable & other assets | 66,665 | 64,443 | 56,853 | 48,449 | 42,235 | |||||||||||||||
Total assets | $ | 2,133,268 | $ | 1,983,822 | $ | 2,010,256 | $ | 2,110,091 | $ | 2,162,478 | ||||||||||
Liabilities and Shareholders' Equity | ||||||||||||||||||||
Deposits: | ||||||||||||||||||||
Non-interest-bearing demand | $ | 765,079 | $ | 804,383 | $ | 838,666 | $ | 952,035 | $ | 993,156 | ||||||||||
Interest bearing checking | 41,701 | 46,852 | 45,179 | 47,711 | 50,674 | |||||||||||||||
Money market and savings | 948,731 | 890,836 | 848,748 | 812,701 | 845,718 | |||||||||||||||
Time | 67,724 | 72,301 | 96,159 | 134,831 | 89,862 | |||||||||||||||
Total deposits | 1,823,235 | 1,814,372 | 1,828,752 | 1,947,278 | 1,979,410 | |||||||||||||||
Subordinated debt, net | 21,805 | 21,779 | 21,754 | 21,729 | 21,703 | |||||||||||||||
Federal Home Loan Bank and other borrowings | 130,000 | - | - | - | - | |||||||||||||||
Accrued interest payable and other liabilities | 20,690 | 21,188 | 21,139 | 19,802 | 24,265 | |||||||||||||||
Total liabilities | 1,995,730 | 1,857,339 | 1,871,645 | 1,988,809 | 2,025,378 | |||||||||||||||
Shareholders' Equity | ||||||||||||||||||||
Common stock | 102,359 | 101,679 | 101,244 | 72,920 | 72,799 | |||||||||||||||
Retained earnings | 93,824 | 85,409 | 78,364 | 73,149 | 68,801 | |||||||||||||||
Accumulated other comprehensive (loss) | (58,645 | ) | (60,605 | ) | (40,997 | ) | (24,787 | ) | (4,500 | ) | ||||||||||
Total shareholders' equity | 137,538 | 126,483 | 138,611 | 121,282 | 137,100 | |||||||||||||||
Total liabilities and shareholders' equity | $ | 2,133,268 | $ | 1,983,822 | $ | 2,010,256 | $ | 2,110,091 | $ | 2,162,478 | ||||||||||
Avidbank Holdings, Inc.
Consolidated Statements of Income (Unaudited)
($000, except share and per share amounts)
| Three Months Ended | Year-to-Date | |||||||||||||||||||
| Dec. 31, 2022 | Sept. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | ||||||||||||||||
Interest and fees on loans | $ | 23,160 | $ | 18,853 | $ | 13,927 | $ | 71,813 | $ | 50,823 | ||||||||||
Interest on investment securities | 2,751 | 2,794 | 1,154 | 9,877 | 3,606 | |||||||||||||||
Other interest income | 526 | 307 | 193 | 1,342 | 456 | |||||||||||||||
Total interest income | 26,437 | 21,954 | 15,274 | 83,032 | 54,885 | |||||||||||||||
Deposit interest expense | 4,269 | 1,948 | 655 | 7,513 | 2,618 | |||||||||||||||
Other interest expense | 414 | 426 | 307 | 1,440 | 1,238 | |||||||||||||||
Total interest expense | 4,683 | 2,374 | 962 | 8,953 | 3,856 | |||||||||||||||
Net interest income | 21,754 | 19,580 | 14,312 | 74,079 | 51,029 | |||||||||||||||
Provision for loan losses | 993 | 925 | 3,279 | 3,510 | 3,572 | |||||||||||||||
Net interest income after provision for | ||||||||||||||||||||
loan losses | 20,761 | 18,655 | 11,033 | 70,569 | 47,457 | |||||||||||||||
Service charges and bank fees | 660 | 725 | 621 | 2,871 | 2,366 | |||||||||||||||
Income from bank owned life insurance | 224 | 219 | 213 | 871 | 451 | |||||||||||||||
Gain/(loss) on sale of assets | - | - | (113 | ) | - | (113 | ) | |||||||||||||
Gain/(loss) on sale of securities | (404 | ) | - | - | (404 | ) | 735 | |||||||||||||
Warrant and success fee income | 119 | 12 | 456 | 281 | 477 | |||||||||||||||
Other investment income | 521 | (1 | ) | 757 | 605 | 1,069 | ||||||||||||||
Other income | 135 | 121 | 131 | 446 | 328 | |||||||||||||||
Total non-interest income | 1,255 | 1,076 | 2,065 | 4,670 | 5,313 | |||||||||||||||
Compensation and benefit expenses | 7,592 | 7,069 | 6,920 | 29,102 | 25,256 | |||||||||||||||
Occupancy and equipment expenses | 911 | 946 | 924 | 3,652 | 4,078 | |||||||||||||||
Data processing | 456 | 447 | 394 | 1,737 | 1,647 | |||||||||||||||
Regulatory assessments | 221 | 421 | 384 | 1,816 | 1,226 | |||||||||||||||
Legal and professional fees | 364 | 269 | 187 | 1,290 | 897 | |||||||||||||||
Other operating expenses | 906 | 761 | 740 | 3,193 | 2,512 | |||||||||||||||
Total non-interest expense | 10,450 | 9,913 | 9,549 | 40,790 | 35,616 | |||||||||||||||
Income before income taxes | 11,566 | 9,818 | 3,549 | 34,449 | 17,154 | |||||||||||||||
Provision for income taxes | 3,151 | 2,772 | 1,015 | 9,426 | 4,890 | |||||||||||||||
Net income | $ | 8,415 | $ | 7,046 | $ | 2,534 | $ | 25,023 | $ | 12,264 | ||||||||||
Basic earnings per common share | $ | 1.16 | $ | 0.97 | $ | 0.43 | $ | 3.64 | $ | 2.08 | ||||||||||
Diluted earnings per common share | $ | 1.13 | $ | 0.95 | $ | 0.42 | $ | 3.55 | $ | 2.02 | ||||||||||
Average common shares outstanding | 7,281,343 | 7,274,617 | 5,904,446 | 6,801,330 | 5,890,216 | |||||||||||||||
Average common fully diluted shares | 7,432,670 | 7,410,062 | 6,101,778 | 6,952,758 | 6,062,482 | |||||||||||||||
Avidbank Holdings, Inc.
Average Balance Sheets and Net Interest Margin Analysis
Selected Financial Information (Unaudited)
($000)
| Three months ended | ||||||||||||||||||||||||
| December 31, 2022 | September 30, 2022 | |||||||||||||||||||||||
| Average Balance | Yields or Rates | Interest Income/ Expense | Average Balance | Yields or Rates | Interest Income/ Expense | |||||||||||||||||||
Assets | ||||||||||||||||||||||||
Interest earning assets: | ||||||||||||||||||||||||
Loans (1) | $ | 1,451,724 | 6.33 | % | $ | 23,160 | $ | 1,358,934 | 5.50 | % | $ | 18,853 | ||||||||||||
Fed funds sold/interest bearing deposits | 52,321 | 3.99 | % | 526 | 52,626 | 2.31 | % | 307 | ||||||||||||||||
Investment securities | ||||||||||||||||||||||||
Taxable investment securities | 428,520 | 2.30 | % | 2,481 | 475,086 | 2.11 | % | 2,530 | ||||||||||||||||
Non-taxable investment securities (2) | 30,537 | 4.48 | % | 345 | 30,763 | 4.31 | % | 333 | ||||||||||||||||
Total investment securities | 459,057 | 2.44 | % | 2,826 | 505,849 | 2.25 | % | 2,863 | ||||||||||||||||
Total interest-earning assets | 1,963,102 | 5.36 | % | 26,512 | 1,917,409 | 4.56 | % | 22,023 | ||||||||||||||||
Noninterest-earning assets: | ||||||||||||||||||||||||
Cash and due from banks | 25,494 | 34,984 | ||||||||||||||||||||||
All other assets (3) | 84,291 | 75,927 | ||||||||||||||||||||||
Total assets | $ | 2,072,887 | $ | 2,028,320 | ||||||||||||||||||||
Liabilities and Shareholders' Equity | ||||||||||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||||||
Deposits | ||||||||||||||||||||||||
Demand | $ | 44,344 | 0.54 | % | $ | 60 | $ | 46,145 | 0.33 | % | $ | 38 | ||||||||||||
Money market and savings | 953,665 | 1.68 | % | 4,027 | 867,113 | 0.81 | % | 1,768 | ||||||||||||||||
Time | 70,409 | 1.03 | % | 182 | 85,703 | 0.66 | % | 142 | ||||||||||||||||
Total interest-bearing deposits | 1,068,418 | 1.59 | % | 4,269 | 998,961 | 0.77 | % | 1,948 | ||||||||||||||||
FHLB and other borrowings | 11,772 | 3.84 | % | 114 | 22,011 | 2.27 | % | 126 | ||||||||||||||||
Subordinated debt | 21,792 | 5.46 | % | 300 | 21,766 | 5.47 | % | 300 | ||||||||||||||||
Total interest-bearing liabilities | 1,101,982 | 1.69 | % | 4,683 | 1,042,738 | 0.90 | % | 2,374 | ||||||||||||||||
Noninterest-bearing liabilities: | ||||||||||||||||||||||||
Demand deposits | 815,222 | 820,047 | ||||||||||||||||||||||
Accrued expenses and other liabilities | 24,637 | 21,133 | ||||||||||||||||||||||
Shareholders' equity | 131,046 | 144,402 | ||||||||||||||||||||||
Total liabilities and | ||||||||||||||||||||||||
shareholders' equity | $ | 2,072,887 | $ | 2,028,320 | ||||||||||||||||||||
Net interest income and margin (4) | 4.41 | % | $ | 21,829 | 4.07 | % | $ | 19,649 | ||||||||||||||||
Non-taxable equivalent net interest margin | 4.40 | % | 4.05 | % | ||||||||||||||||||||
Cost of deposits | 1,883,640 | 0.90 | % | 4,269 | 1,819,008 | 0.42 | % | 1,948 | ||||||||||||||||
| (1) Nonperforming loans are included in average loan balances. No adjustment has been made for these loans in the calculation of yields. Interest income on loans includes net amortization of deferred loan fees / (costs) of $556 thousand and $513 thousand, respectively. | ||||||||||||||||||||||||
| (2) Interest income on tax-exempt securities has been increased to reflect comparable interest on taxable securities. The rate used was 21%, reflecting the statutory federal income tax rate. | ||||||||||||||||||||||||
| (3) Average allowance for loan losses of $15.6 million and $14.7 million, respectively, is included as a contra asset. | ||||||||||||||||||||||||
| (4) Net interest margin is net interest income divided by total interest-earning assets. | ||||||||||||||||||||||||
Avidbank Holdings, Inc.
Average Balance Sheets and Net Interest Margin Analysis
Selected Financial Information (Unaudited)
($000)
| Three months ended | |||||||||||||||||||||||
| December 31, 2022 | December 31, 2021 | ||||||||||||||||||||||
| Average Balance | Yields or Rates | Interest Income/ Expense | Average Balance | Yields or Rates | Interest Income/ Expense | ||||||||||||||||||
Assets | |||||||||||||||||||||||
Interest earning assets: | |||||||||||||||||||||||
Loans (1) | $ | 1,451,724 | 6.33 | % | $ | 23,160 | $ | 1,154,254 | 4.79 | % | $ | 13,927 | |||||||||||
Fed funds sold/interest bearing deposits | 52,321 | 3.99 | % | 526 | 515,430 | 0.15 | % | 193 | |||||||||||||||
Investment securities | |||||||||||||||||||||||
Taxable investment securities | 428,520 | 2.30 | % | 2,481 | 287,915 | 1.59 | % | 1,154 | |||||||||||||||
Non-taxable investment securities (2) | 30,537 | 4.48 | % | 345 | - | 0.00 | % | - | |||||||||||||||
Total investment securities | 459,057 | 2.44 | % | 2,826 | 287,915 | 1.59 | % | 1,154 | |||||||||||||||
Total interest-earning assets | 1,963,102 | 5.36 | % | 26,512 | 1,957,599 | 3.10 | % | 15,274 | |||||||||||||||
Noninterest-earning assets: | |||||||||||||||||||||||
Cash and due from banks | 25,494 | 35,750 | |||||||||||||||||||||
All other assets (3) | 84,291 | 61,196 | |||||||||||||||||||||
Total assets | $ | 2,072,887 | $ | 2,054,545 | |||||||||||||||||||
Liabilities and Shareholders' Equity | |||||||||||||||||||||||
Interest-bearing liabilities: | |||||||||||||||||||||||
Deposits | |||||||||||||||||||||||
Demand | $ | 44,344 | 0.54 | % | $ | 60 | $ | 50,045 | 0.16 | % | $ | 20 | |||||||||||
Money market and savings | 953,665 | 1.68 | % | 4,027 | 715,540 | 0.26 | % | 465 | |||||||||||||||
Time | 70,409 | 1.03 | % | 182 | 99,550 | 0.68 | % | 170 | |||||||||||||||
Total interest-bearing deposits | 1,068,418 | 1.59 | % | 4,269 | 865,135 | 0.30 | % | 655 | |||||||||||||||
FHLB and other borrowings | 11,772 | 3.84 | % | 114 | - | 0.00 | % | - | |||||||||||||||
Subordinated debt | 21,792 | 5.46 | % | 300 | 21,689 | 5.62 | % | 307 | |||||||||||||||
Total interest-bearing liabilities | 1,101,982 | 1.69 | % | 4,683 | 886,824 | 0.43 | % | 962 | |||||||||||||||
Noninterest-bearing liabilities: | |||||||||||||||||||||||
Demand deposits | 815,222 | 1,001,568 | |||||||||||||||||||||
Accrued expenses and other liabilities | 24,637 | 27,564 | |||||||||||||||||||||
Shareholders' equity | 131,046 | 138,589 | |||||||||||||||||||||
Total liabilities and | |||||||||||||||||||||||
shareholders' equity | $ | 2,072,887 | $ | 2,054,545 | |||||||||||||||||||
Net interest income and margin (4) | 4.41 | % | $ | 21,829 | 2.90 | % | $ | 14,312 | |||||||||||||||
Non-taxable equivalent net interest margin | 4.40 | % | 2.90 | % | |||||||||||||||||||
Cost of deposits | 1,883,640 | 0.90 | % | 4,269 | 1,866,703 | 0.14 | % | 655 | |||||||||||||||
| (1) Nonperforming loans are included in average loan balances. No adjustment has been made for these loans in the calculation of yields. Interest income on loans includes net amortization of deferred loan fees / (costs) of $556 thousand and $864 thousand, respectively. | |||||||||||||||||||||||
| (2) Interest income on tax-exempt securities has been increased to reflect comparable interest on taxable securities. The rate used was 21%, reflecting the statutory federal income tax rate. | |||||||||||||||||||||||
| (3) Average allowance for loan losses of $15.6 million and $13.8 million, respectively, is included as a contra asset. | |||||||||||||||||||||||
| (4) Net interest margin is net interest income divided by total interest-earning assets. | |||||||||||||||||||||||
Avidbank Holdings, Inc.
Average Balance Sheets and Net Interest Margin Analysis
Selected Financial Information (Unaudited)
($000)
| Twelve months ended | ||||||||||||||||||||||||
| December 31, 2022 | December 31, 2021 | |||||||||||||||||||||||
| Average Balance | Yields or Rates | Interest Income/ Expense | Average Balance | Yields or Rates | Interest Income/ Expense | |||||||||||||||||||
Assets | ||||||||||||||||||||||||
Interest earning assets: | ||||||||||||||||||||||||
Loans (1) | $ | 1,322,969 | 5.43 | % | $ | 71,813 | $ | 1,054,292 | 4.82 | % | $ | 50,823 | ||||||||||||
Fed funds sold/interest bearing deposits | 166,665 | 0.81 | % | 1,342 | 358,324 | 0.13 | % | 456 | ||||||||||||||||
Investment securities | ||||||||||||||||||||||||
Taxable investment securities | 453,805 | 2.03 | % | 9,230 | 222,204 | 1.62 | % | 3,606 | ||||||||||||||||
Non-taxable investment securities (2) | 18,566 | 4.42 | % | 820 | - | 0.00 | % | - | ||||||||||||||||
Total investment securities | 472,371 | 2.13 | % | 10,050 | 222,204 | 1.62 | % | 3,606 | ||||||||||||||||
Total interest-earning assets | 1,962,005 | 4.24 | % | 83,205 | 1,634,820 | 3.36 | % | 54,885 | ||||||||||||||||
Noninterest-earning assets: | ||||||||||||||||||||||||
Cash and due from banks | 37,221 | 30,455 | ||||||||||||||||||||||
All other assets (3) | 73,763 | 48,613 | ||||||||||||||||||||||
Total assets | $ | 2,072,989 | $ | 1,713,888 | ||||||||||||||||||||
Liabilities and Shareholders' Equity | ||||||||||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||||||
Deposits | ||||||||||||||||||||||||
Demand | $ | 46,468 | 0.28 | % | $ | 129 | $ | 38,084 | 0.17 | % | $ | 66 | ||||||||||||
Money market and savings | 867,419 | 0.77 | % | 6,656 | 576,448 | 0.29 | % | 1,668 | ||||||||||||||||
Time including brokered | 99,553 | 0.73 | % | 728 | 120,514 | 0.73 | % | 884 | ||||||||||||||||
Total interest-bearing deposits | 1,013,440 | 0.74 | % | 7,513 | 735,046 | 0.36 | % | 2,618 | ||||||||||||||||
FHLB and other borrowings | 8,515 | 2.81 | % | 239 | - | 0.00 | % | - | ||||||||||||||||
Subordinated debt | 21,698 | 5.54 | % | 1,201 | 21,636 | 5.72 | % | 1,238 | ||||||||||||||||
Total interest-bearing liabilities | 1,043,653 | 0.86 | % | 8,953 | 756,682 | 0.51 | % | 3,856 | ||||||||||||||||
Noninterest-bearing liabilities: | ||||||||||||||||||||||||
Demand deposits | 870,793 | 797,837 | ||||||||||||||||||||||
Accrued expenses and other liabilities | 22,702 | 25,723 | ||||||||||||||||||||||
Shareholders' equity | 135,841 | 133,646 | ||||||||||||||||||||||
Total liabilities and | ||||||||||||||||||||||||
shareholders' equity | $ | 2,072,989 | $ | 1,713,888 | ||||||||||||||||||||
Net interest income and margin (4) | 3.78 | % | $ | 74,252 | 3.12 | % | $ | 51,029 | ||||||||||||||||
Non-taxable equivalent net interest margin | 3.78 | % | 3.12 | % | ||||||||||||||||||||
Cost of deposits | 1,884,233 | 0.40 | % | 7,513 | 1,532,883 | 0.17 | % | 2,618 | ||||||||||||||||
| (1) Nonperforming loans are included in average loan balances. No adjustment has been made for these loans in the calculation of yields. Interest income on loans includes amortization of deferred loan fees / (costs) of $2.2 million and $2.7 million, respectively. | ||||||||||||||||||||||||
| (2) Interest income on tax-exempt securities has been increased to reflect comparable interest on taxable securities. The rate used was 21%, reflecting the statutory federal income tax rate. | ||||||||||||||||||||||||
| (3) Average allowance for loan losses of $14.2 million and $12.9 million, respectively, is included as a contra asset. | ||||||||||||||||||||||||
| (4) Tax equivalent net interest income divided by total interest-earning assets. | ||||||||||||||||||||||||
Avidbank Holdings, Inc.
Period End Loans (Unaudited)
($000)
| Current | Year over | |||||||||||||||||||||||||||
| Dec. 31, | Sept. 30, | June 30, | March 31, | Dec. 31 | Quarter | Year | ||||||||||||||||||||||
| 2022 | 2022 | 2022 | 2022 | 2021 | Change | Change | ||||||||||||||||||||||
Commercial loans | $ | 700,022 | $ | 566,105 | $ | 558,908 | $ | 481,522 | $ | 517,747 | $ | 133,917 | $ | 182,275 | ||||||||||||||
Commercial real estate | ||||||||||||||||||||||||||||
Multi-family | 169,048 | 159,384 | 165,818 | 141,954 | 139,646 | 9,664 | 29,402 | |||||||||||||||||||||
Owner Occupied | 139,414 | 131,649 | 108,045 | 109,502 | 99,728 | 7,765 | 39,686 | |||||||||||||||||||||
Non-Owner Occupied | 303,660 | 288,478 | 280,397 | 258,365 | 258,507 | 15,182 | 45,153 | |||||||||||||||||||||
Construction and land | 227,869 | 234,157 | 209,941 | 195,388 | 190,887 | (6,288 | ) | 36,982 | ||||||||||||||||||||
Residential | 13,394 | 11,991 | 12,830 | 13,726 | 14,484 | 1,403 | (1,090 | ) | ||||||||||||||||||||
Total real estate loans | 853,385 | 825,659 | 777,031 | 718,935 | 703,252 | 27,726 | 150,133 | |||||||||||||||||||||
Other loans | 815 | 782 | 847 | 1,477 | 2,345 | 33 | (1,530 | ) | ||||||||||||||||||||
Total loans | $ | 1,554,222 | $ | 1,392,546 | $ | 1,336,786 | $ | 1,201,934 | $ | 1,223,344 | $ | 161,676 | $ | 330,878 | ||||||||||||||
Avidbank Holdings, Inc.
Credit Trends (Unaudited)
($000)
| Dec. 31, | Sept. 30, | June 30, | March 31, | Dec. 31, | ||||||||||||||||
| 2022 | 2022 | 2022 | 2022 | 2021 | ||||||||||||||||
Allowance for Loan Losses | ||||||||||||||||||||
Balance, beginning of quarter | $ | 15,488 | $ | 14,646 | $ | 13,054 | $ | 13,054 | $ | 12,775 | ||||||||||
Provision for loan losses, quarterly | 993 | 925 | 1,592 | - | 3,279 | |||||||||||||||
Charge-offs, quarterly | - | (83 | ) | - | - | (3,000 | ) | |||||||||||||
Recoveries, quarterly | - | - | - | - | - | |||||||||||||||
Balance, end of quarter | $ | 16,481 | $ | 15,488 | $ | 14,646 | $ | 13,054 | $ | 13,054 | ||||||||||
Nonperforming Assets | ||||||||||||||||||||
Loans accounted for on a non-accrual basis | $ | 14,245 | $ | 154 | $ | 159 | $ | 3,204 | $ | 3,244 | ||||||||||
Loans with principal or interest contractually past | ||||||||||||||||||||
due 90 days or more and still accruing interest | - | - | - | - | - | |||||||||||||||
Nonperforming loans | 14,245 | 154 | 159 | 3,204 | 3,244 | |||||||||||||||
Other real estate owned | - | - | - | - | - | |||||||||||||||
Nonperforming assets | $ | 14,245 | $ | 154 | $ | 159 | $ | 3,204 | $ | 3,244 | ||||||||||
Nonperforming Loans by Type: | ||||||||||||||||||||
Commercial | $ | 150 | $ | 154 | $ | 159 | $ | 441 | $ | 448 | ||||||||||
Commercial Real Estate Loans | - | - | - | 2,763 | 2,796 | |||||||||||||||
Construction and Land | 14,095 | - | - | - | - | |||||||||||||||
Total Nonperforming loans | $ | 14,245 | $ | 154 | $ | 159 | $ | 3,204 | $ | 3,244 | ||||||||||
Asset Quality Ratios | ||||||||||||||||||||
Allowance for loan losses (ALLL) to total loans | 1.06 | % | 1.11 | % | 1.09 | % | 1.08 | % | 1.07 | % | ||||||||||
ALLL to nonperforming loans | 115.70 | % | 10057.14 | % | 9211.32 | % | 407.43 | % | 402.40 | % | ||||||||||
Nonperforming assets to total assets | 0.67 | % | 0.01 | % | 0.01 | % | 0.15 | % | 0.15 | % | ||||||||||
Nonperforming loans to total loans | 0.92 | % | 0.01 | % | 0.01 | % | 0.27 | % | 0.27 | % | ||||||||||
Net quarterly charge-offs to total loans | 0.00 | % | 0.01 | % | 0.00 | % | 0.00 | % | 0.25 | % | ||||||||||
SOURCE: Avidbank Holdings, Inc.