CU Ban­corp re­ports solid 3Q earn­ings

The Pak Banker - - Front Page -

EN­CINO, CALIF

CU Ban­corp, the par­ent com­pany of wholly owned Cal­i­for­nia United Bank, to­day re­ported fi­nan­cial re­sults for the third quar­ter of 2012.

The re­sults for the quar­ter re­flect two months of com­bined op­er­a­tions with Premier Com­mer­cial Ban­corp and its sub­sidiary Premier Com­mer­cial Bank, which were merged into CU Ban­corp and Cal­i­for­nia United Bank, re­spec­tively, on July 31, 2012, and in­clude two sig­nif­i­cant non-re­cur­ring items: for the third quar­ter of 2012, CU Ban­corp re­ported a net loss of $932 thou­sand, or $0.10 per share, which com­pares to net in­come of $601 thou­sand, or $0.09 per fully di­luted share, for the third quar­ter of 2011. Pre-tax earn­ings be­fore merger-re­lated ex­penses in­creased by 6.5 per­cent to $1.13 mil­lion com­pared to $1.06 mil­lion in the third quar­ter of 2011;

to­tal as­sets were $1.27 bil­lion at Septem­ber 30, 2012, an in­crease of $360 mil­lion or 40 per­cent from June 30, 2012; to­tal loans in­creased $306 mil­lion or 63 per­cent from June 30, 2012 which in­cludes net or­ganic loan growth of $51.0 mil­lion, or 10 per­cent from the end of the prior quar­ter; net in­ter­est mar­gin in­creased to 3.57% com­pared to 3.37% for the prior quar­ter.

To­tal de­posits grew $302 mil­lion or 38 per­cent from June 30, 2012 in­clud­ing net or­ganic de­posit growth of $24.2 mil­lion, or 3 per­cent from the end of the prior quar­ter. Net charge-offs de­clined to $44 thou­sand for the third quar­ter of 2012, com­pared to $563 thou­sand for the sec­ond quar­ter of 2012.

Con­tin­ued sta­tus as well-cap­i­tal­ized, the high­est reg­u­la­tory cat­e­gory. At Septem­ber 30, 2012, the ra­tio of to­tal cap­i­tal to risk-based as­sets was 12.24 per­cent; the ra­tio of Tier 1 cap­i­tal to risk-based as­sets was 11.43 per­cent; and the Tier 1 lever­age ra­tio was 10.01 per­cent.

We had a very event­ful quar­ter, high­lighted by the com­ple­tion of our merger with Premier Com­mer­cial Ban­corp, sur­pass­ing $1 bil­lion in to­tal as­sets, and pre­par­ing for our list­ing on the Nas­daq Cap­i­tal Mar­ket, said David Rainer, Pres­i­dent and Chief Ex­ec­u­tive Of­fi­cer of CU Ban­corp and Cal­i­for­nia United Bank. In ad­di­tion to the sig­nif­i­cant events in the quar­ter, we con­tin­ued to ef­fec­tively ex­e­cute on our busi­ness de­vel­op­ment ini­tia­tives, which helped gen­er­ate a $51.0 mil­lion or­ganic in­crease in our to­tal loans.

This loan growth was driven by the com­bi­na­tion of ex­ist­ing bor­row­ers ex­pand­ing their lend­ing re­la­tion­ships with CUB and the ad­di­tion of new com­mer­cial and en­tre­pre­neur­ial cus­tomers who value the cus­tom­ized prod­ucts and ser­vices that we of­fer and our com­mit­ment to ex­cep­tional cus­tomer ser­vice.

The Bank's net in­ter­est in­come was pos­i­tively im­pacted in both the sec­ond and third quar­ters of 2012 by the recog­ni­tion of the dis­count earned on early payoffs of ac­quired loans. The Bank recorded $214 thou­sand and $193 thou­sand in dis­count earned on early loan payoffs of ac­quired loans in the sec­ond and third quar­ters of 2012, re­spec­tively.

Net in­ter­est mar­gin in the third quar­ter of 2012 was 3.57 per­cent, com­pared to 3.61 per­cent in the third quar­ter of 2011 and 3.37 per­cent in the sec­ond quar­ter of 2012. The in­crease in net in­ter­est mar­gin from the sec­ond quar­ter of 2012 is pri­mar­ily at­trib­ut­able to a higher per­cent­age of loans in the mix of in­ter­est-earn­ing as­sets. The Com­pany's av­er­age yield on loans was 5.59 per­cent in the third quar­ter of 2012, com­pared to 5.56 per­cent in the sec­ond quar­ter of 2012. The in­crease was pri­mar­ily at­trib­ut­able to the acc­retable yield rec­og­nized on PCB loans marked to fair value at the time of the merger, which pos­i­tively im­pacts in­ter­est in­come.

—AP

T-shirts printed with pic­tures of US Pres­i­dent Barack Obama and Myan­mar op­po­si­tion leader Aung San Suu Kyi are dis­played at a shop in down­town of Myan­mar.

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