05/07/2021 | Press release | Archived content
☒ |
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐ |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
California
|
77-0446957
|
|
(State or other jurisdiction of incorporation or organization)
|
(I.R.S. Employer Identification No.)
|
445 Pine Avenue, Goleta, California
|
93117
|
|
(Address of principal executive offices)
|
(Zip Code)
|
Large accelerated filer ☐
|
Accelerated filer ☐
|
Non-accelerated filer ☐ (Do not check if a smaller reporting company)
|
Smaller reporting company ☒
|
Emerging growth company ☐
|
Index
|
Page
|
||
Part I. Financial Information
|
|||
Item 1 - Financial Statements
|
|||
Consolidated Balance Sheets as of March 31, 2021 (unaudited) and December 31, 2020
|
2
|
||
Consolidated Income Statements for the three months ended March 31, 2021 and 2020 (unaudited)
|
3
|
||
Consolidated Statements of Comprehensive Income for the three months ended March 31, 2021 and 2020 (unaudited)
|
4
|
||
Consolidated Statement of Stockholders' Equity for the three months ended March 31, 2021 and 2020 (unaudited)
|
5
|
||
Consolidated Statements of Cash Flows for the three months ended March 31, 2021 and 2020 (unaudited)
|
6
|
||
Notes to Unaudited Consolidated Financial Statements
|
7
|
||
The financial statements included in this Form 10-Q should be read in conjunction with Community West Bancshares' Annual Report on Form 10-K for the fiscal year ended December 31, 2020.
|
|||
Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations
|
33
|
||
Item 3 - Quantitative and Qualitative Disclosures About Market Risk
|
49
|
||
Item 4 - Controls and Procedures
|
49
|
||
Part II. Other Information
|
|||
Item 1 - Legal Proceedings
|
50
|
||
Item 1A - Risk Factors
|
50
|
||
Item 2 - Unregistered Sales of Equity Securities and Use of Proceeds
|
50
|
||
Item 3 - Defaults Upon Senior Securities
|
50
|
||
Item 4 - Mine Safety Disclosures
|
50
|
||
Item 5 - Other Information
|
50
|
||
Item 6 - Exhibits
|
51
|
||
|
|||
Signatures
|
51
|
Item 1. |
Financial Statements
|
March 31,
2021
|
December 31,
2020
|
|||||||
(unaudited)
|
||||||||
(in thousands, except share amounts)
|
||||||||
Assets:
|
||||||||
Cash and due from banks and federal funds sold
|
$
|
2,607
|
$
|
1,587
|
||||
Interest-earning demand in other financial institutions
|
71,128
|
58,953
|
||||||
Cash and cash equivalents
|
73,735
|
60,540
|
||||||
Investment securities - available-for-sale, at fair value; amortized cost of $17,610 at March 31, 2021 and $17,266 at December 31, 2020
|
17,588
|
17,308
|
||||||
Investment securities - held-to-maturity, at amortized cost; fair value of $3,966 at March 31, 2021 and $4,854 at December 31, 2020
|
3,781
|
4,586
|
||||||
Investment securities - measured at fair value; amortized cost of $66 at March 31, 2021 and December 31, 2020.
|
201
|
149
|
||||||
Federal Home Loan Bank stock, at cost
|
3,260
|
3,260
|
||||||
Federal Reserve Bank stock, at cost
|
1,373
|
1,373
|
||||||
Loans:
|
||||||||
Held for sale, at lower of cost or fair value
|
29,767
|
31,229
|
||||||
Held for investment, net of allowance for loan losses of $10,233 at March 31, 2021 and $10,194 at December 31, 2020
|
847,848
|
816,154
|
||||||
Total loans
|
877,615
|
847,383
|
||||||
Other assets acquired through foreclosure, net
|
2,572
|
2,614
|
||||||
Premises and equipment, net
|
6,992
|
7,154
|
||||||
Other assets
|
30,905
|
31,068
|
||||||
Total assets
|
$
|
1,018,022
|
$
|
975,435
|
||||
Liabilities:
|
||||||||
Deposits:
|
||||||||
Non-interest-bearing demand
|
$
|
196,617
|
$
|
181,837
|
||||
Interest-bearing demand
|
440,502
|
398,101
|
||||||
Savings
|
19,858
|
18,736
|
||||||
Certificates of deposit ($250,000 or more)
|
20,072
|
30,536
|
||||||
Other certificates of deposit
|
127,472
|
136,975
|
||||||
Total deposits
|
804,521
|
766,185
|
||||||
Other borrowings
|
105,000
|
105,000
|
||||||
Other liabilities
|
16,710
|
15,243
|
||||||
Total liabilities
|
926,231
|
886,428
|
||||||
Commitments and Contingencies
|
||||||||
Stockholders' equity:
|
||||||||
Common stock - no par value, 60,000,000 shares authorized; 8,524,413 shares issued and outstanding at March 31, 2021 and 8,473,063 at December 31, 2020
|
43,227
|
42,909
|
||||||
Retained earnings
|
48,574
|
46,063
|
||||||
Accumulated other comprehensive income (loss)
|
(10
|
)
|
35
|
|||||
Total stockholders' equity
|
91,791
|
89,007
|
||||||
Total liabilities and stockholders' equity
|
$
|
1,018,022
|
$
|
975,435
|
Three Months Ended
March 31,
|
||||||||
2021
|
2020
|
|||||||
Interest income:
|
(in thousands, except per share amounts)
|
|||||||
Loans, including fees
|
$
|
10,856
|
$
|
10,664
|
||||
Investment securities and other
|
199
|
311
|
||||||
Total interest income
|
11,055
|
10,975
|
||||||
Interest expense:
|
||||||||
Deposits
|
742
|
2,122
|
||||||
Other borrowings
|
271
|
390
|
||||||
Total interest expense
|
1,013
|
2,512
|
||||||
Net interest income
|
10,042
|
8,463
|
||||||
(Credit) provision for loan losses
|
(173
|
)
|
392
|
|||||
Net interest income after provision for loan losses
|
10,215
|
8,071
|
||||||
Non-interest income:
|
||||||||
Other loan fees
|
313
|
341
|
||||||
Gains from loan sales, net
|
118
|
190
|
||||||
Document processing fees
|
106
|
124
|
||||||
Service charges
|
67
|
134
|
||||||
Other
|
293
|
161
|
||||||
Total non-interest income
|
897
|
950
|
||||||
Non-interest expenses:
|
||||||||
Salaries and employee benefits
|
4,565
|
4,398
|
||||||
Occupancy, net
|
779
|
758
|
||||||
Professional services
|
340
|
383
|
||||||
Data processing
|
340
|
283
|
||||||
Depreciation
|
205
|
208
|
||||||
FDIC assessment
|
91
|
144
|
||||||
Advertising and marketing
|
183
|
153
|
||||||
Stock based compensation
|
68
|
85
|
||||||
Other
|
289
|
317
|
||||||
Total non-interest expenses
|
6,860
|
6,729
|
||||||
Income before provision for income taxes
|
4,252
|
2,292
|
||||||
Provision for income taxes
|
1,231
|
694
|
||||||
Net income
|
$
|
3,021
|
$
|
1,598
|
||||
Earnings per share:
|
||||||||
Basic
|
$
|
0.36
|
$
|
0.19
|
||||
Diluted
|
$
|
0.35
|
$
|
0.19
|
||||
Weighted average number of common shares outstanding:
|
||||||||
Basic
|
8,495
|
8,472
|
||||||
Diluted
|
8,615
|
8,579
|
||||||
Dividends declared per common share
|
$
|
0.060
|
$
|
0.055
|
Three Months Ended
March 31,
|
||||||||
2021
|
2020
|
|||||||
(in thousands)
|
||||||||
Net income
|
$
|
3,021
|
$
|
1,598
|
||||
Other comprehensive (loss), net:
|
||||||||
Unrealized (loss) on securities available-for-sale (AFS), net (tax effect of $19 and $14 for each respective period presented)
|
(45
|
)
|
(34
|
)
|
||||
Net other comprehensive (loss)
|
(45
|
)
|
(34
|
)
|
||||
Comprehensive income
|
$
|
2,976
|
$
|
1,564
|
Three Months Ended March 31, 2021
|
Common Stock
|
Accumulated
Other
Comprehensive
Income (Loss)
|
Retained
Earnings
|
Total
Stockholders'
Equity
|
||||||||||||||||
Shares
|
Amount
|
|||||||||||||||||||
(in thousands)
|
||||||||||||||||||||
Balance, December 31, 2020:
|
8,473
|
$
|
42,909
|
$
|
35
|
$
|
46,063
|
$
|
89,007
|
|||||||||||
Net income
|
-
|
-
|
-
|
3,021
|
3,021
|
|||||||||||||||
Exercise of stock options
|
51
|
250
|
-
|
-
|
250
|
|||||||||||||||
Stock based compensation
|
-
|
68
|
-
|
-
|
68
|
|||||||||||||||
Dividends on common stock
|
-
|
-
|
-
|
(510
|
)
|
(510
|
)
|
|||||||||||||
Other comprehensive (loss), net
|
-
|
-
|
(45
|
)
|
-
|
(45
|
)
|
|||||||||||||
Balance, March 31, 2021
|
8,524
|
$
|
43,227
|
$
|
(10
|
)
|
$
|
48,574
|
$
|
91,791
|
Three Months Ended March 31, 2020
|
Common Stock
|
Accumulated
Other
Comprehensive
Income (Loss)
|
Retained
Earnings
|
Total
Stockholders'
Equity
|
||||||||||||||||
Shares
|
Amount
|
|||||||||||||||||||
(in thousands)
|
||||||||||||||||||||
Balance, December 31, 2019:
|
8,472
|
$
|
42,586
|
$
|
(78
|
)
|
$
|
39,470
|
$
|
81,978
|
||||||||||
Net income
|
-
|
-
|
-
|
1,598
|
1,598
|
|||||||||||||||
Stock based compensation
|
-
|
85
|
-
|
-
|
85
|
|||||||||||||||
Dividends on common stock
|
-
|
-
|
-
|
(466
|
)
|
(466
|
)
|
|||||||||||||
Other comprehensive (loss), net
|
-
|
-
|
(34
|
)
|
-
|
(34
|
)
|
|||||||||||||
Balance, March 31, 2020
|
8,472
|
$
|
42,671
|
$
|
(112
|
)
|
$
|
40,602
|
$
|
83,161
|
Three Months Ended March 31,
|
||||||||
2021
|
2020
|
|||||||
(in thousands)
|
||||||||
Cash flows from operating activities:
|
||||||||
Net income
|
$
|
3,021
|
$
|
1,598
|
||||
Adjustments to reconcile net income to cash provided by operating activities:
|
||||||||
(Credit) Provision for loan losses
|
(173
|
)
|
392
|
|||||
Depreciation
|
205
|
208
|
||||||
Stock based compensation
|
68
|
85
|
||||||
Deferred income taxes
|
30
|
226
|
||||||
Net accretion of discounts and premiums for investment securities
|
24
|
29
|
||||||
(Gains) Losses on:
|
||||||||
Sale of loans, net
|
(118
|
)
|
(190
|
)
|
||||
Loans originated for sale and principal collections, net
|
1,462
|
2,588
|
||||||
Changes in:
|
||||||||
Investment securities held at fair value
|
(52
|
)
|
56
|
|||||
Other assets
|
130
|
(113
|
)
|
|||||
Other liabilities
|
1,691
|
(282
|
)
|
|||||
Servicing assets, net
|
(24
|
)
|
(124
|
)
|
||||
Net cash provided by operating activities
|
6,264
|
4,473
|
||||||
Cash flows from investing activities:
|
||||||||
Principal pay downs and maturities of available-for-sale securities
|
1,146
|
1,136
|
||||||
Purchase of available-for-sale securities
|
(1,500
|
)
|
-
|
|||||
Principal pay downs and maturities of held-to-maturity securities
|
791
|
385
|
||||||
Loan originations and principal collections, net
|
(31,539
|
)
|
(8,879
|
)
|
||||
Purchase of restricted stock, net
|
-
|
(256
|
)
|
|||||
Purchase of premises and equipment, net
|
(43
|
)
|
(54
|
)
|
||||
Net cash used in investing activities
|
(31,145
|
)
|
(7,668
|
)
|
||||
Cash flows from financing activities:
|
||||||||
Net (decrease) increase in deposits
|
38,336
|
(39,335
|
)
|
|||||
Net increase in borrowings
|
-
|
50,000
|
||||||
Exercise of stock options
|
250
|
-
|
||||||
Cash dividends paid on common stock
|
(510
|
)
|
(466
|
)
|
||||
Net cash provided by financing activities
|
38,076
|
10,199
|
||||||
Net increase cash and cash equivalents
|
13,195
|
7,004
|
||||||
Cash and cash equivalents at beginning of period
|
60,540
|
82,661
|
||||||
Cash and cash equivalents at end of period
|
$
|
73,735
|
$
|
89,665
|
||||
Supplemental disclosure:
|
||||||||
Cash paid during the period for:
|
||||||||
Interest
|
$
|
1,016
|
$
|
2,134
|
||||
Income Taxes
|
$
|
-
|
$
|
-
|
||||
Non-cash investing and financing activity:
|
||||||||
Transfers to other assets acquired through foreclosure, net
|
136
|
106
|
1. |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
|
|
• |
Commercial Real Estate, Commercial, Commercial Agriculture, SBA, HELOC, Single Family Residential, and Consumer - Migration analysis combined with risk rating is used to determine the required ALL for all non-impaired loans. In addition, the migration results are adjusted based upon qualitative factors that affect the specific portfolio category. Reserves on impaired loans are determined based upon the individual characteristics of the loan.
|
|
• |
Manufactured Housing - The ALL is calculated on the basis of loss history and risk rating, which is primarily a function of delinquency. In addition, the loss results are adjusted based upon qualitative factors that affect this specific portfolio.
|
|
• |
The expected future cash flows are estimated and then discounted at the effective interest rate.
|
|
• |
The value of the underlying collateral net of selling costs. Selling costs are estimated based on industry standards, the Company's actual experience or actual costs incurred as appropriate. When evaluating real estate collateral, the Company typically uses appraisals or valuations, no more than twelve months old at time of evaluation. When evaluating non-real estate collateral securing the loan, the Company will use audited financial statements or appraisals no more than twelve months old at time of evaluation. Additionally, for both real estate and non-real estate collateral, the Company may use other sources to determine value as deemed appropriate.
|
|
• |
The loan's observable market price.
|
|
• |
Concentrations of credit
|
|
• |
Trends in volume, maturity, and composition of loans
|
|
• |
Volume and trend in delinquency, nonaccrual, and classified assets
|
|
• |
Economic conditions
|
|
• |
Geographic distance
|
|
• |
Policy and procedures or underwriting standards
|
|
• |
Staff experience and ability
|
|
• |
Value of underlying collateral
|
|
• |
Competition, legal, or regulatory environment
|
|
• |
Results of outside exams and quality of loan review and Board oversight
|
2. |
INVESTMENT SECURITIES
|
March 31, 2021
|
||||||||||||||||
Amortized
Cost
|
Gross
Unrealized
Gains
|
Gross
Unrealized
(Losses)
|
Fair
Value
|
|||||||||||||
Securities available-for-sale
|
(in thousands)
|
|||||||||||||||
U.S. government agency notes
|
$
|
6,280
|
$
|
2
|
$
|
(26
|
)
|
$
|
6,256
|
|||||||
U.S. government agency collateralized mortgage obligations ('CMO')
|
6,830
|
33
|
(13
|
)
|
6,850
|
|||||||||||
Other securities
|
4,500
|
-
|
(18
|
)
|
4,482
|
|||||||||||
Total
|
$
|
17,610
|
$
|
35
|
$
|
(57
|
)
|
$
|
17,588
|
|||||||
Securities held-to-maturity
|
||||||||||||||||
U.S. government agency mortgage-backed securities ('MBS')
|
$
|
3,781
|
$
|
186
|
$
|
(1
|
)
|
$
|
3,966
|
|||||||
Total
|
$
|
3,781
|
$
|
186
|
$
|
(1
|
)
|
$
|
3,966
|
|||||||
Securities measured at fair value
|
||||||||||||||||
Equity securities: Farmer Mac class A stock
|
$
|
66
|
$
|
135
|
$
|
-
|
$
|
201
|
||||||||
Total
|
$
|
66
|
$
|
135
|
$
|
-
|
$
|
201
|
December 31, 2020
|
||||||||||||||||
Amortized
Cost
|
Gross
Unrealized
Gains
|
Gross
Unrealized
(Losses)
|
Fair
Value
|
|||||||||||||
Securities available-for-sale
|
(in thousands)
|
|||||||||||||||
U.S. government agency notes
|
$
|
6,501
|
$
|
1
|
$
|
(30
|
)
|
$
|
6,472
|
|||||||
U.S. government agency collateralized mortgage obligations ('CMO')
|
7,765
|
33
|
(13
|
)
|
7,785
|
|||||||||||
Other securities
|
3,000
|
53
|
(2
|
)
|
3,051
|
|||||||||||
Total
|
$
|
17,266
|
$
|
87
|
$
|
(45
|
)
|
$
|
17,308
|
|||||||
Securities held-to-maturity
|
||||||||||||||||
U.S. government agency mortgage-backed securities ('MBS')
|
$
|
4,586
|
$
|
269
|
$
|
(1
|
)
|
$
|
4,854
|
|||||||
Total
|
$
|
4,586
|
$
|
269
|
$
|
(1
|
)
|
$
|
4,854
|
|||||||
Securities measured at fair value
|
||||||||||||||||
Equity securities: Farmer Mac class A stock
|
$
|
66
|
$
|
83
|
$
|
-
|
$
|
149
|
||||||||
Total
|
$
|
66
|
$
|
83
|
$
|
-
|
$
|
149
|
March 31, 2021
|
||||||||||||||||||||||||||||||||||||||||
Less than One
Year
|
One to Five
Years
|
Five to Ten
Years
|
Over Ten Years
|
Total
|
||||||||||||||||||||||||||||||||||||
Amount
|
Yield
|
Amount
|
Yield
|
Amount
|
Yield
|
Amount
|
Yield
|
Amount
|
Yield
|
|||||||||||||||||||||||||||||||
Securities available-for-sale
|
(dollars in thousands)
|
|||||||||||||||||||||||||||||||||||||||
U.S. government agency notes
|
$
|
-
|
-
|
$
|
767
|
0.6
|
%
|
$
|
5,489
|
1.2
|
%
|
$
|
-
|
-
|
$
|
6,256
|
1.2
|
%
|
||||||||||||||||||||||
U.S. government agency CMO
|
161
|
2.1
|
%
|
3,147
|
0.5
|
%
|
2,643
|
0.6
|
%
|
899
|
0.9
|
%
|
6,850
|
0.6
|
%
|
|||||||||||||||||||||||||
Other securities
|
-
|
-
|
2,987
|
4.8
|
%
|
1,495
|
3.7
|
%
|
-
|
-
|
4,482
|
4.4
|
%
|
|||||||||||||||||||||||||||
Total
|
$
|
161
|
2.1
|
%
|
$
|
6,901
|
2.3
|
%
|
$
|
9,627
|
1.5
|
%
|
$
|
899
|
0.9
|
%
|
$
|
17,588
|
1.8
|
%
|
||||||||||||||||||||
Securities held-to-maturity
|
||||||||||||||||||||||||||||||||||||||||
U.S. government agency MBS
|
$
|
-
|
-
|
$
|
1,513
|
3.3
|
%
|
$
|
2,268
|
2.8
|
%
|
$
|
-
|
-
|
$
|
3,781
|
3.0
|
%
|
||||||||||||||||||||||
Total
|
$
|
-
|
-
|
$
|
1,513
|
3.3
|
%
|
$
|
2,268
|
2.8
|
%
|
$
|
-
|
-
|
$
|
3,781
|
3.0
|
%
|
||||||||||||||||||||||
Securities measured at fair value
|
||||||||||||||||||||||||||||||||||||||||
Farmer Mac class A stock
|
$
|
-
|
-
|
$
|
-
|
-
|
$
|
-
|
-
|
$
|
-
|
-
|
$
|
201
|
-
|
|||||||||||||||||||||||||
Total
|
$
|
-
|
-
|
$
|
-
|
-
|
$
|
-
|
-
|
$
|
-
|
-
|
$
|
201
|
-
|
December 31, 2020
|
||||||||||||||||||||||||||||||||||||||||
Less than One
Year
|
One to Five
Years
|
Five to Ten
Years
|
Over Ten Years
|
Total
|
||||||||||||||||||||||||||||||||||||
Amount
|
Yield
|
Amount
|
Yield
|
Amount
|
Yield
|
Amount
|
Yield
|
Amount
|
Yield
|
|||||||||||||||||||||||||||||||
Securities available-for-sale
|
(dollars in thousands)
|
|||||||||||||||||||||||||||||||||||||||
U.S. government agency notes
|
$
|
-
|
-
|
$
|
784
|
0.6
|
%
|
$
|
5,688
|
1.7
|
%
|
$
|
-
|
-
|
$
|
6,472
|
1.2
|
%
|
||||||||||||||||||||||
U.S. government agency CMO
|
820
|
0
|
5,832
|
0.6
|
%
|
1,133
|
0.8
|
%
|
-
|
-
|
7,785
|
2.3
|
%
|
|||||||||||||||||||||||||||
-
|
0.0
|
%
|
3,051
|
4.8
|
%
|
-
|
0.0
|
%
|
-
|
0.0
|
%
|
3,051
|
4.8
|
%
|
||||||||||||||||||||||||||
Total
|
$
|
820
|
0
|
$
|
9,667
|
1.9
|
%
|
$
|
6,821
|
1.5
|
%
|
$
|
-
|
-
|
$
|
17,308
|
1.6
|
%
|
||||||||||||||||||||||
Securities held-to-maturity
|
||||||||||||||||||||||||||||||||||||||||
U.S. government agency MBS
|
$
|
-
|
-
|
$
|
3,821
|
2.8
|
%
|
$
|
765
|
3.6
|
%
|
$
|
-
|
-
|
$
|
4,586
|
2.9
|
%
|
||||||||||||||||||||||
Total
|
$
|
-
|
-
|
$
|
3,821
|
2.8
|
%
|
$
|
765
|
3.6
|
%
|
$
|
-
|
-
|
$
|
4,586
|
2.9
|
%
|
||||||||||||||||||||||
Securities measured at fair value
|
||||||||||||||||||||||||||||||||||||||||
Farmer Mac class A stock
|
$
|
-
|
-
|
$
|
-
|
-
|
$
|
-
|
-
|
$
|
-
|
-
|
$
|
149
|
-
|
|||||||||||||||||||||||||
Total
|
$
|
-
|
-
|
$
|
-
|
-
|
$
|
-
|
-
|
$
|
-
|
-
|
$
|
149
|
-
|
March 31,
2021
|
December 31,
2020
|
|||||||||||||||
Amortized
Cost
|
Estimated
Fair Value
|
Amortized
Cost
|
Estimated
Fair Value
|
|||||||||||||
Securities available-for-sale
|
(in thousands)
|
|||||||||||||||
Due in one year or less
|
$
|
160
|
$
|
161
|
$
|
817
|
$
|
820
|
||||||||
After one year through five years
|
6,903
|
6,901
|
9,594
|
9,667
|
||||||||||||
After five years through ten years
|
9,643
|
9,627
|
6,855
|
6,821
|
||||||||||||
After ten years
|
904
|
899
|
-
|
-
|
||||||||||||
Total
|
$
|
17,610
|
$
|
17,588
|
$
|
17,266
|
$
|
17,308
|
||||||||
Securities held-to-maturity
|
||||||||||||||||
Due in one year or less
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
||||||||
After one year through five years
|
1,513
|
1,583
|
3,821
|
3,965
|
||||||||||||
After five years through ten years
|
2,268
|
2,383
|
765
|
889
|
||||||||||||
After ten years
|
-
|
-
|
-
|
-
|
||||||||||||
Total
|
$
|
3,781
|
$
|
3,966
|
$
|
4,586
|
$
|
4,854
|
||||||||
Securities measured at fair value
|
||||||||||||||||
Farmer Mac class A stock
|
$
|
66
|
$
|
201
|
$
|
66
|
$
|
149
|
||||||||
Total
|
$
|
66
|
$
|
201
|
$
|
66
|
$
|
149
|
March 31, 2021
|
||||||||||||||||||||||||
Less Than Twelve Months
|
More Than Twelve Months
|
Total
|
||||||||||||||||||||||
Gross
Unrealized
Losses
|
Fair
Value
|
Gross
Unrealized
Losses
|
Fair
Value
|
Gross
Unrealized
Losses
|
Fair
Value
|
|||||||||||||||||||
Securities available-for-sale
|
(in thousands)
|
|||||||||||||||||||||||
U.S. government agency notes
|
$
|
-
|
$
|
-
|
$
|
7
|
$
|
767
|
$
|
7
|
$
|
767
|
||||||||||||
U.S. government agency CMO
|
-
|
-
|
32
|
5,202
|
32
|
5,202
|
||||||||||||||||||
Other securities
|
18
|
4,482
|
-
|
-
|
18
|
4,482
|
||||||||||||||||||
Total
|
$
|
18
|
$
|
4,482
|
$
|
39
|
$
|
5,969
|
$
|
57
|
$
|
10,451
|
||||||||||||
Securities held-to-maturity
|
||||||||||||||||||||||||
U.S. government agency MBS
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
||||||||||||
Total
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
||||||||||||
Securities measured at fair value
|
||||||||||||||||||||||||
Farmer Mac class A stock
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
||||||||||||
Total
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
December 31, 2020
|
||||||||||||||||||||||||
Less Than Twelve Months
|
More Than Twelve Months
|
Total
|
||||||||||||||||||||||
Gross
Unrealized
Losses
|
Fair
Value
|
Gross
Unrealized
Losses
|
Fair
Value
|
Gross
Unrealized
Losses
|
Fair
Value
|
|||||||||||||||||||
Securities available-for-sale
|
(in thousands)
|
|||||||||||||||||||||||
U.S. government agency notes
|
$
|
-
|
$
|
-
|
$
|
7
|
$
|
784
|
$
|
7
|
$
|
784
|
||||||||||||
U.S. government agency CMO
|
-
|
-
|
36
|
6,021
|
36
|
6,021
|
||||||||||||||||||
Other securities
|
2
|
1,498
|
-
|
-
|
2
|
1,498
|
||||||||||||||||||
Total
|
$
|
2
|
$
|
1,498
|
$
|
43
|
$
|
6,805
|
$
|
45
|
$
|
8,303
|
||||||||||||
Securities held-to-maturity
|
||||||||||||||||||||||||
U.S. government agency MBS
|
$
|
1
|
$
|
185
|
$
|
-
|
$
|
-
|
$
|
1
|
$
|
185
|
||||||||||||
Total
|
$
|
1
|
$
|
185
|
$
|
-
|
$
|
-
|
$
|
1
|
$
|
185
|
||||||||||||
Securities measured at fair value
|
||||||||||||||||||||||||
Farmer Mac class A stock
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
||||||||||||
Total
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
3. |
LOANS HELD FOR SALE
|
4. |
LOANS HELD FOR INVESTMENT
|
March 31,
|
December 31,
|
|||||||
2021
|
2020
|
|||||||
(in thousands)
|
||||||||
Manufactured housing
|
$
|
284,583
|
$
|
280,284
|
||||
Commercial real estate
|
407,336
|
402,148
|
||||||
Commercial
|
55,944
|
57,933
|
||||||
SBA
|
97,988
|
73,131
|
||||||
HELOC
|
3,846
|
3,861
|
||||||
Single family real estate
|
10,966
|
10,490
|
||||||
Consumer
|
10
|
133
|
||||||
860,673
|
827,980
|
|||||||
Allowance for loan losses
|
(10,233
|
)
|
(10,194
|
)
|
||||
Deferred fees, net
|
(2,544
|
)
|
(1,583
|
)
|
||||
Discount on SBA loans
|
(48
|
)
|
(49
|
)
|
||||
Total loans held for investment, net
|
$
|
847,848
|
$
|
816,154
|
March 31, 2021
|
||||||||||||||||||||||||||||||||
Current
|
30-59 Days
Past Due
|
60-89 Days
Past Due
|
Over 90 Days
Past Due
|
Total
Past Due
|
Nonaccrual
|
Total
|
Recorded
Investment
Over 90 Days
and Accruing
|
|||||||||||||||||||||||||
(in thousands)
|
||||||||||||||||||||||||||||||||
Manufactured housing
|
$
|
284,137
|
$
|
214
|
$
|
-
|
$
|
-
|
$
|
214
|
$
|
232
|
$
|
284,583
|
$
|
-
|
||||||||||||||||
Commercial real estate:
|
||||||||||||||||||||||||||||||||
Commercial real estate
|
368,386
|
-
|
-
|
-
|
-
|
-
|
368,386
|
-
|
||||||||||||||||||||||||
SBA 504 1st trust deed
|
16,250
|
-
|
-
|
-
|
-
|
1,428
|
17,678
|
-
|
||||||||||||||||||||||||
Land
|
8,306
|
-
|
-
|
-
|
-
|
-
|
8,306
|
-
|
||||||||||||||||||||||||
Construction
|
12,967
|
-
|
-
|
-
|
-
|
-
|
12,967
|
-
|
||||||||||||||||||||||||
Commercial
|
55,944
|
-
|
-
|
-
|
-
|
-
|
55,944
|
-
|
||||||||||||||||||||||||
SBA
|
97,824
|
-
|
-
|
-
|
-
|
164
|
97,988
|
-
|
||||||||||||||||||||||||
HELOC
|
3,846
|
-
|
-
|
-
|
-
|
-
|
3,846
|
-
|
||||||||||||||||||||||||
Single family real estate
|
10,842
|
-
|
-
|
-
|
-
|
124
|
10,966
|
-
|
||||||||||||||||||||||||
Consumer
|
10
|
-
|
-
|
-
|
-
|
-
|
10
|
-
|
||||||||||||||||||||||||
Total
|
$
|
858,511
|
$
|
214
|
$
|
-
|
$
|
-
|
$
|
214
|
$
|
1,948
|
$
|
860,673
|
$
|
-
|
December 31, 2020
|
||||||||||||||||||||||||||||||||
Current
|
30-59 Days
Past Due
|
60-89 Days
Past Due
|
Over 90 Days
Past Due
|
Total
Past Due
|
Nonaccrual
|
Total
|
Recorded
Investment
Over 90 Days
and Accruing
|
|||||||||||||||||||||||||
(in thousands)
|
||||||||||||||||||||||||||||||||
Manufactured housing
|
$
|
277,873
|
$
|
1,716
|
$
|
81
|
$
|
-
|
$
|
1,797
|
$
|
614
|
$
|
280,284
|
$
|
-
|
||||||||||||||||
Commercial real estate:
|
||||||||||||||||||||||||||||||||
Commercial real estate
|
360,345
|
-
|
-
|
-
|
-
|
-
|
360,345
|
-
|
||||||||||||||||||||||||
SBA 504 1st trust deed
|
16,423
|
-
|
-
|
-
|
-
|
1,469
|
17,892
|
-
|
||||||||||||||||||||||||
Land
|
6,528
|
-
|
-
|
-
|
-
|
-
|
6,528
|
-
|
||||||||||||||||||||||||
Construction
|
17,383
|
-
|
-
|
-
|
-
|
-
|
17,383
|
-
|
||||||||||||||||||||||||
Commercial
|
56,451
|
92
|
-
|
-
|
92
|
1,390
|
57,933
|
-
|
||||||||||||||||||||||||
SBA
|
72,856
|
-
|
-
|
-
|
-
|
275
|
73,131
|
-
|
||||||||||||||||||||||||
HELOC
|
3,861
|
-
|
-
|
-
|
-
|
-
|
3,861
|
-
|
||||||||||||||||||||||||
Single family real estate
|
10,366
|
-
|
-
|
-
|
-
|
124
|
10,490
|
-
|
||||||||||||||||||||||||
Consumer
|
133
|
-
|
-
|
-
|
-
|
-
|
133
|
-
|
||||||||||||||||||||||||
Total
|
$
|
822,219
|
$
|
1,808
|
$
|
81
|
$
|
-
|
$
|
1,889
|
$
|
3,872
|
$
|
827,980
|
$
|
-
|
Three Months Ended March 31,
|
||||||||
2021
|
2020
|
|||||||
(in thousands)
|
||||||||
Beginning balance
|
$
|
10,194
|
$
|
8,717
|
||||
Charge-offs
|
-
|
-
|
||||||
Recoveries
|
212
|
58
|
||||||
Net recoveries
|
212
|
58
|
||||||
Provision (credit)
|
(173
|
)
|
392
|
|||||
Ending balance
|
$
|
10,233
|
$
|
9,167
|
For the Three Months Ended March 31,
|
||||||||||||||||||||||||||||||||
Manufactured
Housing
|
Commercial
Real Estate
|
Commercial
|
SBA
|
HELOC
|
Single Family
Real Estate
|
Consumer
|
Total
|
|||||||||||||||||||||||||
2021
|
(in thousands)
|
|||||||||||||||||||||||||||||||
Beginning balance
|
$
|
2,612
|
$
|
5,950
|
$
|
1,379
|
$
|
118
|
$
|
25
|
$
|
108
|
$
|
2
|
$
|
10,194
|
||||||||||||||||
Charge-offs
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||||||||
Recoveries
|
139
|
20
|
10
|
41
|
2
|
-
|
-
|
212
|
||||||||||||||||||||||||
Net recoveries
|
139
|
20
|
10
|
41
|
2
|
-
|
-
|
212
|
||||||||||||||||||||||||
Provision (credit)
|
(128
|
)
|
250
|
(281
|
)
|
(29
|
)
|
(2
|
)
|
18
|
(1
|
)
|
(173
|
)
|
||||||||||||||||||
Ending balance
|
$
|
2,623
|
$
|
6,220
|
$
|
1,108
|
$
|
130
|
$
|
25
|
$
|
126
|
$
|
1
|
$
|
10,233
|
||||||||||||||||
2020
|
||||||||||||||||||||||||||||||||
Beginning balance
|
$
|
2,184
|
$
|
5,217
|
$
|
1,162
|
$
|
32
|
$
|
27
|
$
|
92
|
$
|
3
|
$
|
8,717
|
||||||||||||||||
Charge-offs
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||||||||
Recoveries
|
6
|
20
|
27
|
3
|
2
|
-
|
-
|
58
|
||||||||||||||||||||||||
Net recoveries
|
6
|
20
|
27
|
3
|
2
|
-
|
-
|
58
|
||||||||||||||||||||||||
Provision (credit)
|
174
|
247
|
(25
|
)
|
(6
|
)
|
(2
|
)
|
4
|
-
|
392
|
|||||||||||||||||||||
Ending balance
|
$
|
2,364
|
$
|
5,484
|
$
|
1,164
|
$
|
29
|
$
|
27
|
$
|
96
|
$
|
3
|
$
|
9,167
|
Manufactured
Housing
|
Commercial
Real Estate
|
Commercial
|
SBA
|
HELOC
|
Single Family
Real Estate
|
Consumer
|
Total
Loans
|
|||||||||||||||||||||||||
Loans Held for Investment as of March 31, 2021:
|
(in thousands)
|
|||||||||||||||||||||||||||||||
Recorded Investment:
|
||||||||||||||||||||||||||||||||
Impaired loans with an allowance recorded
|
$
|
4,200
|
$
|
227
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
443
|
$
|
-
|
$
|
4,870
|
||||||||||||||||
Impaired loans with no allowance recorded
|
1,809
|
1,427
|
1,789
|
420
|
-
|
1,850
|
-
|
7,295
|
||||||||||||||||||||||||
Total loans individually evaluated for impairment
|
6,009
|
1,654
|
1,789
|
420
|
-
|
2,293
|
-
|
12,165
|
||||||||||||||||||||||||
Loans collectively evaluated for impairment
|
278,574
|
405,682
|
54,155
|
97,568
|
3,846
|
8,673
|
10
|
848,508
|
||||||||||||||||||||||||
Total loans held for investment
|
$
|
284,583
|
$
|
407,336
|
$
|
55,944
|
$
|
97,988
|
$
|
3,846
|
$
|
10,966
|
$
|
10
|
$
|
860,673
|
||||||||||||||||
Unpaid Principal Balance
|
||||||||||||||||||||||||||||||||
Impaired loans with an allowance recorded
|
$
|
4,200
|
$
|
227
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
443
|
$
|
-
|
$
|
4,870
|
||||||||||||||||
Impaired loans with no allowance recorded
|
2,412
|
1,467
|
1,789
|
911
|
-
|
1,850
|
-
|
8,429
|
||||||||||||||||||||||||
Total loans individually evaluated for impairment
|
6,612
|
1,694
|
1,789
|
911
|
-
|
2,293
|
-
|
13,299
|
||||||||||||||||||||||||
Loans collectively evaluated for impairment
|
278,574
|
405,682
|
54,155
|
97,568
|
3,846
|
8,673
|
10
|
848,508
|
||||||||||||||||||||||||
Total loans held for investment
|
$
|
285,186
|
$
|
407,376
|
$
|
55,944
|
$
|
98,479
|
$
|
3,846
|
$
|
10,966
|
$
|
10
|
$
|
861,807
|
||||||||||||||||
Related Allowance for Credit Losses
|
||||||||||||||||||||||||||||||||
Impaired loans with an allowance recorded
|
$
|
261
|
$
|
17
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
15
|
$
|
-
|
$
|
293
|
||||||||||||||||
Impaired loans with no allowance recorded
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||||||||
Total loans individually evaluated for impairment
|
261
|
17
|
-
|
-
|
-
|
15
|
-
|
293
|
||||||||||||||||||||||||
Loans collectively evaluated for impairment
|
2,362
|
6,203
|
1,108
|
130
|
25
|
111
|
1
|
9,940
|
||||||||||||||||||||||||
Total loans held for investment
|
$
|
2,623
|
$
|
6,220
|
$
|
1,108
|
$
|
130
|
$
|
25
|
$
|
126
|
$
|
1
|
$
|
10,233
|
Manufactured
Housing
|
Commercial
Real Estate
|
Commercial
|
SBA
|
HELOC
|
Single Family
Real Estate
|
Consumer
|
Total
Loans
|
|||||||||||||||||||||||||
Loans Held for Investment as of December 31, 2020:
|
(in thousands)
|
|||||||||||||||||||||||||||||||
Recorded Investment:
|
||||||||||||||||||||||||||||||||
Impaired loans with an allowance recorded
|
$
|
4,402
|
$
|
230
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
449
|
$
|
-
|
$
|
5,081
|
||||||||||||||||
Impaired loans with no allowance recorded
|
2,294
|
1,468
|
1,504
|
292
|
-
|
1,860
|
-
|
7,418
|
||||||||||||||||||||||||
Total loans individually evaluated for impairment
|
6,696
|
1,698
|
1,504
|
292
|
-
|
2,309
|
-
|
12,499
|
||||||||||||||||||||||||
Loans collectively evaluated for impairment
|
273,588
|
400,450
|
56,429
|
72,839
|
3,861
|
8,181
|
133
|
815,481
|
||||||||||||||||||||||||
Total loans held for investment
|
$
|
280,284
|
$
|
402,148
|
$
|
57,933
|
$
|
73,131
|
$
|
3,861
|
$
|
10,490
|
$
|
133
|
$
|
827,980
|
||||||||||||||||
Unpaid Principal Balance
|
||||||||||||||||||||||||||||||||
Impaired loans with an allowance recorded
|
$
|
4,402
|
$
|
230
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
449
|
$
|
-
|
$
|
5,081
|
||||||||||||||||
Impaired loans with no allowance recorded
|
3,066
|
1,474
|
1,844
|
946
|
-
|
1,860
|
-
|
9,190
|
||||||||||||||||||||||||
Total loans individually evaluated for impairment
|
7,468
|
1,704
|
1,844
|
946
|
-
|
2,309
|
-
|
14,271
|
||||||||||||||||||||||||
Loans collectively evaluated for impairment
|
273,588
|
400,450
|
56,429
|
72,839
|
3,861
|
8,181
|
133
|
815,481
|
||||||||||||||||||||||||
Total loans held for investment
|
$
|
281,056
|
$
|
402,154
|
$
|
58,273
|
$
|
73,785
|
$
|
3,861
|
$
|
10,490
|
$
|
133
|
$
|
829,752
|
||||||||||||||||
Related Allowance for Credit Losses
|
||||||||||||||||||||||||||||||||
Impaired loans with an allowance recorded
|
$
|
279
|
$
|
16
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
16
|
$
|
-
|
$
|
311
|
||||||||||||||||
Impaired loans with no allowance recorded
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||||||||
Total loans individually evaluated for impairment
|
279
|
16
|
-
|
-
|
-
|
16
|
-
|
311
|
||||||||||||||||||||||||
Loans collectively evaluated for impairment
|
2,333
|
5,934
|
1,379
|
118
|
25
|
92
|
2
|
9,883
|
||||||||||||||||||||||||
Total loans held for investment
|
$
|
2,612
|
$
|
5,950
|
$
|
1,379
|
$
|
118
|
$
|
25
|
$
|
108
|
$
|
2
|
$
|
10,194
|
March 31,
2021
|
December 31,
2020
|
|||||||
(in thousands)
|
||||||||
Manufactured housing
|
$
|
6,009
|
$
|
6,696
|
||||
Commercial real estate :
|
||||||||
Commercial real estate
|
-
|
-
|
||||||
SBA 504 1st trust deed
|
1,654
|
1,698
|
||||||
Land
|
-
|
-
|
||||||
Construction
|
-
|
-
|
||||||
Commercial
|
1,789
|
1,504
|
||||||
SBA
|
420
|
292
|
||||||
HELOC
|
-
|
-
|
||||||
Single family real estate
|
2,293
|
2,309
|
||||||
Consumer
|
-
|
-
|
||||||
Total
|
$
|
12,165
|
$
|
12,499
|
Three Months Ended March 31,
|
||||||||||||||||
2021
|
2020
|
|||||||||||||||
Average
Investment
in Impaired
Loans
|
Interest
Income
|
Average
Investment
in Impaired
Loans |
Interest
Income
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Manufactured housing
|
$
|
6,311
|
$
|
113
|
$
|
7,923
|
$
|
135
|
||||||||
Commercial real estate:
|
||||||||||||||||
Commercial real estate
|
-
|
-
|
84
|
-
|
||||||||||||
SBA 504 1st trust deed
|
1,666
|
38
|
234
|
4
|
||||||||||||
Land
|
-
|
-
|
-
|
-
|
||||||||||||
Construction
|
-
|
-
|
-
|
-
|
||||||||||||
Commercial
|
1,636
|
27
|
1,754
|
2
|
||||||||||||
SBA
|
353
|
4
|
371
|
-
|
||||||||||||
HELOC
|
-
|
-
|
-
|
-
|
||||||||||||
Single family real estate
|
2,286
|
28
|
2,329
|
31
|
||||||||||||
Consumer
|
-
|
-
|
-
|
-
|
||||||||||||
Total
|
$
|
12,252
|
$
|
210
|
$
|
12,695
|
$
|
172
|
March 31,
2021
|
December 31,
2020
|
|||||||
(in thousands)
|
||||||||
Nonaccrual loans
|
$
|
1,948
|
$
|
3,872
|
||||
Government guaranteed portion of loans included above
|
$
|
123
|
$
|
207
|
||||
Troubled debt restructured loans, gross
|
$
|
11,160
|
$
|
11,141
|
||||
Loans 30 through 89 days past due with interest accruing
|
$
|
214
|
$
|
1,889
|
||||
Loans 90 days or more past due with interest accruing
|
$
|
-
|
$
|
-
|
||||
Allowance for loan losses to gross loans held for investment
|
1.19
|
%
|
1.23
|
%
|
March 31,
2021
|
December 31,
2020
|
|||||||
(in thousands)
|
||||||||
Manufactured housing
|
$
|
232
|
$
|
614
|
||||
Commercial real estate:
|
||||||||
Commercial real estate
|
-
|
-
|
||||||
SBA 504 1st trust deed
|
1,428
|
1,469
|
||||||
Land
|
-
|
-
|
||||||
Construction
|
-
|
-
|
||||||
Commercial
|
-
|
1,390
|
||||||
SBA
|
164
|
275
|
||||||
HELOC
|
-
|
-
|
||||||
Single family real estate
|
124
|
124
|
||||||
Consumer
|
-
|
-
|
||||||
Total
|
$
|
1,948
|
$
|
3,872
|
March 31, 2021
|
||||||||||||||||||||
Pass
|
Special Mention
|
Substandard
|
Doubtful
|
Total
|
||||||||||||||||
(in thousands)
|
||||||||||||||||||||
Manufactured housing
|
$
|
283,448
|
$
|
-
|
$
|
1,135
|
$
|
-
|
$
|
284,583
|
||||||||||
Commercial real estate:
|
||||||||||||||||||||
Commercial real estate
|
348,608
|
6,203
|
12,258
|
-
|
367,069
|
|||||||||||||||
SBA 504 1st trust deed
|
14,722
|
-
|
2,956
|
-
|
17,678
|
|||||||||||||||
Land
|
8,306
|
-
|
-
|
-
|
8,306
|
|||||||||||||||
Construction
|
12,967
|
-
|
-
|
-
|
12,967
|
|||||||||||||||
Commercial
|
47,342
|
750
|
3,465
|
-
|
51,557
|
|||||||||||||||
SBA
|
2,345
|
27
|
290
|
-
|
2,662
|
|||||||||||||||
HELOC
|
3,846
|
-
|
-
|
-
|
3,846
|
|||||||||||||||
Single family real estate
|
10,669
|
-
|
297
|
-
|
10,966
|
|||||||||||||||
Consumer
|
10
|
-
|
-
|
-
|
10
|
|||||||||||||||
Total, net
|
732,262
|
6,980
|
20,401
|
-
|
759,643
|
|||||||||||||||
Government guarantee
|
97,347
|
-
|
3,682
|
-
|
101,029
|
|||||||||||||||
Total
|
$
|
829,610
|
$
|
6,980
|
$
|
24,083
|
$
|
-
|
$
|
860,673
|
December 31, 2020
|
||||||||||||||||||||
Pass
|
Special Mention
|
Substandard
|
Doubtful
|
Total
|
||||||||||||||||
(in thousands)
|
||||||||||||||||||||
Manufactured housing
|
$
|
278,826
|
$
|
-
|
$
|
1,458
|
$
|
-
|
$
|
280,284
|
||||||||||
Commercial real estate:
|
||||||||||||||||||||
Commercial real estate
|
340,391
|
6,265
|
12,362
|
-
|
359,018
|
|||||||||||||||
SBA 504 1st trust deed
|
14,877
|
-
|
3,015
|
-
|
17,892
|
|||||||||||||||
Land
|
6,528
|
-
|
-
|
-
|
6,528
|
|||||||||||||||
Construction
|
15,344
|
-
|
2,039
|
-
|
17,383
|
|||||||||||||||
Commercial
|
48,776
|
823
|
3,419
|
-
|
53,018
|
|||||||||||||||
SBA
|
2,554
|
34
|
263
|
2,851
|
||||||||||||||||
HELOC
|
3,861
|
-
|
-
|
-
|
3,861
|
|||||||||||||||
Single family real estate
|
10,361
|
-
|
129
|
-
|
10,490
|
|||||||||||||||
Consumer
|
133
|
-
|
-
|
-
|
133
|
|||||||||||||||
Total, net
|
721,651
|
7,122
|
22,685
|
$
|
-
|
751,458
|
||||||||||||||
Government guarantee
|
72,876
|
-
|
3,646
|
-
|
76,522
|
|||||||||||||||
Total
|
$
|
794,527
|
$
|
7,122
|
$
|
26,331
|
$
|
-
|
$
|
827,980
|
For the Three Months Ended March 31, 2021
|
||||||||||||||||||||||||
Number
of Loans
|
Pre-
Modification
Recorded
Investment |
Post
Modification
Recorded
Investment
|
Balance of
Loans with
Rate
Reduction
|
Balance of
Loans with
Term
Extension
|
Effect on
Allowance
for
Loan Losses
|
|||||||||||||||||||
(dollars in thousands)
|
||||||||||||||||||||||||
Manufactured housing
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
|||||||||||||
Total
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
For the Three Months Ended March 31, 2020
|
||||||||||||||||||||||||
Number
of Loans
|
Pre-
Modification
Recorded
Investment |
Post
Modification
Recorded
Investment
|
Balance of
Loans with
Rate
Reduction
|
Balance of
Loans with
Term
Extension
|
Effect on
Allowance
for
Loan Losses
|
|||||||||||||||||||
(dollars in thousands)
|
||||||||||||||||||||||||
Manufactured housing
|
1
|
$
|
56
|
$
|
56
|
$
|
56
|
$
|
56
|
$
|
1
|
|||||||||||||
Total
|
1
|
$
|
56
|
$
|
56
|
$
|
56
|
$
|
56
|
$
|
1
|
5. |
OTHER ASSETS ACQUIRED THROUGH FORECLOSURE
|
Three Months Ended March 31,
|
||||||||
2021
|
2020
|
|||||||
(in thousands)
|
||||||||
Balance, beginning of period
|
$
|
2,614
|
$
|
2,524
|
||||
Additions
|
136
|
106
|
||||||
Proceeds from dispositions
|
-
|
-
|
||||||
Gain (loss) on foreclosed assets, net
|
(178
|
)
|
77
|
|||||
Third-party portion of writedown/loss
|
-
|
-
|
||||||
Balance, end of period
|
$
|
2,572
|
$
|
2,707
|
6. |
FAIR VALUE MEASUREMENT
|
|
• |
Level 1- Observable quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.
|
|
• |
Level 2- Observable quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, matrix pricing or model-based valuation techniques where all significant assumptions are observable, either directly or indirectly in the market.
|
|
• |
Level 3- Model-based techniques where all significant assumptions are not observable, either directly or indirectly, in the market. These unobservable assumptions reflect management's estimates of assumptions that market participants would use in pricing the asset or liability. Valuation techniques may include use of discounted cash flow models and similar techniques.
|
Fair Value Measurements at the End of the
Reporting Period Using: |
||||||||||||||||
March 31, 2021
|
Quoted Prices in
Active
Markets for
Identical Assets
(Level 1)
|
Significant
Other
Observable
Inputs
(Level 2)
|
Significant
Unobservable
Inputs
(Level 3)
|
Fair
Value
|
||||||||||||
Assets:
|
(in thousands)
|
|||||||||||||||
Investment securities measured at fair value
|
$
|
201
|
$
|
-
|
$
|
-
|
$
|
201
|
||||||||
Investment securities available-for-sale
|
-
|
17,588
|
-
|
17,588
|
||||||||||||
Interest only strips
|
-
|
-
|
23
|
23
|
||||||||||||
Servicing assets
|
-
|
-
|
1,485
|
1,485
|
||||||||||||
Total
|
$
|
201
|
$
|
17,588
|
$
|
1,508
|
$
|
19,297
|
Fair Value Measurements at the End of the
Reporting Period Using:
|
||||||||||||||||
December 31, 2020
|
Quoted Prices in
Active
Markets for
Identical Assets
(Level 1)
|
Significant
Other
Observable
Inputs
(Level 2)
|
Significant
Unobservable
Inputs
(Level 3)
|
Fair
Value
|
||||||||||||
Assets:
|
(in thousands)
|
|||||||||||||||
Investment securities measured at fair value
|
$
|
149
|
$
|
-
|
$
|
-
|
$
|
149
|
||||||||
Investment securities available-for-sale
|
-
|
12,759
|
1,498
|
14,257
|
||||||||||||
Interest only strips
|
-
|
-
|
27
|
27
|
||||||||||||
Servicing assets
|
-
|
-
|
1,461
|
1,461
|
||||||||||||
Total
|
$
|
149
|
$
|
12,759
|
$
|
2,986
|
$
|
15,894
|
Fair Value Measurements at the End of the Reporting Period Using:
|
||||||||||||||||
Total
|
Quoted Prices in
Active
Markets for
Identical Assets
(Level 1)
|
Active Markets
for Similar
Assets
(Level 2)
|
Unobservable
Inputs
(Level 3)
|
|||||||||||||
(in thousands)
|
||||||||||||||||
March 31, 2021:
|
||||||||||||||||
Impaired loans
|
$
|
3,829
|
$
|
-
|
$
|
3,829
|
$
|
-
|
||||||||
Loans held for sale
|
32,679
|
-
|
32,679
|
-
|
||||||||||||
Foreclosed real estate and repossessed assets
|
2,572
|
-
|
2,572
|
-
|
||||||||||||
Total
|
$
|
39,080
|
$
|
-
|
$
|
39,080
|
$
|
-
|
Fair Value Measurements at the End of the Reporting Period Using:
|
||||||||||||||||
Total
|
Quoted Prices in
Active
Markets for
Identical Assets
(Level 1)
|
Active Markets
for Similar
Assets
(Level 2)
|
Unobservable
Inputs
(Level 3)
|
|||||||||||||
(in thousands)
|
||||||||||||||||
December 31, 2020:
|
||||||||||||||||
Impaired loans
|
$
|
3,910
|
$
|
-
|
$
|
3,910
|
$
|
-
|
||||||||
Loans held for sale
|
34,383
|
-
|
34,383
|
-
|
||||||||||||
Foreclosed real estate and repossessed assets
|
2,614
|
-
|
2,614
|
-
|
||||||||||||
Total
|
$
|
40,907
|
$
|
-
|
$
|
40,907
|
$
|
-
|
March 31, 2021
|
||||||||||||||||||||
Carrying
|
Fair Value
|
|||||||||||||||||||
Amount
|
Level 1
|
Level 2
|
Level 3
|
Total
|
||||||||||||||||
Financial assets:
|
(in thousands)
|
|||||||||||||||||||
Cash and cash equivalents
|
$
|
73,735
|
$
|
73,735
|
$
|
-
|
$
|
-
|
$
|
73,735
|
||||||||||
FRB and FHLB stock
|
4,633
|
-
|
4,633
|
-
|
4,633
|
|||||||||||||||
Investment securities
|
21,570
|
201
|
21,554
|
-
|
21,755
|
|||||||||||||||
Loans, net
|
877,615
|
-
|
894,890
|
8,044
|
902,934
|
|||||||||||||||
Financial liabilities:
|
||||||||||||||||||||
Deposits
|
804,521
|
-
|
804,893 |
-
|
804,893
|
|||||||||||||||
Other borrowings
|
105,000
|
-
|
105,409
|
-
|
105,409
|
December 31, 2020
|
||||||||||||||||||||
Carrying
|
Fair Value
|
|||||||||||||||||||
Amount
|
Level 1
|
Level 2
|
Level 3
|
Total
|
||||||||||||||||
Financial assets:
|
(in thousands)
|
|||||||||||||||||||
Cash and cash equivalents
|
$
|
60,540
|
$
|
60,540
|
$
|
-
|
$
|
-
|
$
|
60,540
|
||||||||||
FRB and FHLB stock
|
4,633
|
-
|
4,633
|
-
|
4,633
|
|||||||||||||||
Investment securities
|
22,043
|
149
|
22,162
|
-
|
22,311
|
|||||||||||||||
Loans, net
|
847,383
|
-
|
845,302
|
8,278
|
853,580
|
|||||||||||||||
Financial liabilities:
|
||||||||||||||||||||
Deposits
|
766,185
|
-
|
765,565
|
-
|
765,565
|
|||||||||||||||
Other borrowings
|
105,000
|
-
|
106,051
|
-
|
106,051
|
7. |
OTHER BORROWINGS
|
8. |
STOCKHOLDERS' EQUITY
|
Three Months Ended March 31,
|
||||||||
2021
|
2020
|
|||||||
Unrealized holding gains (losses ) on AFS
|
||||||||
(in thousands)
|
||||||||
Beginning balance
|
$
|
35
|
$
|
(78
|
)
|
|||
Other comprehensive loss before reclassifications
|
(45
|
)
|
(34
|
)
|
||||
Amounts reclassified from accumulated other comprehensive income
|
-
|
-
|
||||||
Net current-period other comprehensive loss
|
(45
|
)
|
(34
|
)
|
||||
Ending Balance
|
$
|
(10
|
)
|
$
|
(112
|
)
|
9. |
CAPITAL REQUIREMENT
|
Total Capital
(To Risk-
Weighted
Assets)
|
Tier 1 Capital
(To Risk-
Weighted
Assets)
|
Common
Equity Tier 1
(To Risk-
Weighted
Assets)
|
Leverage
Ratio/Tier 1
Capital
(To Average
Assets)
|
Community Banking
Leverage Ratio (1)
|
||||||||||||||||
March 31, 2021
|
||||||||||||||||||||
CWB's actual regulatory ratios
|
12.53
|
%
|
11.28
|
%
|
11.28
|
%
|
8.97
|
%
|
8.97
|
%
|
||||||||||
Minimum capital requirements
|
8.00
|
%
|
6.00
|
%
|
4.50
|
%
|
4.00
|
%
|
8.00
|
%
|
||||||||||
Well-capitalized requirements
|
10.00
|
%
|
8.00
|
%
|
6.50
|
%
|
N/A
|
9.00
|
%
|
|||||||||||
Minimum capital requirements including fully-phased in capital conservation buffer
|
10.50
|
%
|
8.50
|
%
|
7.00
|
%
|
N/A
|
N/A
|
(1)
|
Temporary CBLR requires minimum of 8.50% to be considered well-capitalized until January 1, 2022.
|
Total Capital
(To Risk-
Weighted Assets)
|
Tier 1 Capital
(To Risk-
Weighted Assets) |
Common Equity
Tier 1
(To Risk-
Weighted Assets)
|
Leverage Ratio/Tier
1 Capital
(To Average Assets)
|
|||||||||||||
December 31, 2020
|
||||||||||||||||
CWB's actual regulatory ratios
|
12.27
|
%
|
11.02
|
%
|
11.02
|
%
|
9.29
|
%
|
||||||||
Minimum capital requirements
|
8.00
|
%
|
6.00
|
%
|
4.50
|
%
|
4.00
|
%
|
||||||||
Well-capitalized requirements
|
10.00
|
%
|
8.00
|
%
|
6.50
|
%
|
N/A
|
|||||||||
Minimum capital requirements including fully-phased in capital conservation buffer
|
10.50
|
%
|
8.50
|
%
|
7.00
|
%
|
N/A
|
10. |
REVENUE RECOGNITION
|
Non-interest income
|
Three Months Ended March 31,
|
|||||||
2021
|
2020
|
|||||||
In-scope of Topic 606:
|
(in thousands)
|
|||||||
Service charges on deposit accounts
|
$
|
53
|
$
|
120
|
||||
Exchange fees and other service charges
|
103
|
40
|
||||||
Non-interest income (in-scope of Topic 606)
|
156
|
160
|
||||||
Non-interest income (out-of-scope of Topic 606)
|
741
|
790
|
||||||
Total
|
$
|
897
|
$
|
950
|
11.
|
LEASES
|
Three Months Ended March 31,
|
||||||||
2021
|
2020
|
|||||||
Lease cost:
|
(in thousands)
|
|||||||
Operating lease cost
|
250
|
277
|
||||||
Sublease income
|
-
|
-
|
||||||
Total lease cost
|
250
|
277
|
||||||
Other information
|
||||||||
Cash paid for amounts included in the measurement of lease liabilities
|
-
|
-
|
||||||
Operating cash flows from operating leases
|
248
|
274
|
||||||
Weighted average remaining lease term - operating leases
|
8.61 years
|
9.52 Years
|
||||||
Weighted average discount rate - operating leases
|
3.23
|
%
|
3.24
|
%
|
March 31,
|
||||||||
2021
|
2020
|
|||||||
(in thousands)
|
||||||||
2020
|
$
|
-
|
$
|
741
|
||||
2021
|
744
|
884
|
||||||
2022
|
887
|
779
|
||||||
2023
|
813
|
705
|
||||||
2024
|
821
|
713
|
||||||
2025
|
768
|
705
|
||||||
Thereafter
|
2,586
|
2,586
|
||||||
Total future minimum lease payments
|
$
|
6,619
|
$
|
7,113
|
||||
Less remaining imputed interest
|
866
|
1,021
|
||||||
Total lease liabilities
|
$
|
5,753
|
$
|
6,092
|
ITEM 2. |
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
|
• |
COVID-19 related impact on the Company and its clients, employees, and vendors, which may depend on several factors including the scope and continued duration of the pandemic, its influence on the financial markets, long-term and post-pandemic changes in the banking preferences and behaviors of clients, supply chain risks to the bank and its clients and actions taken by governmental authorities and other third parties in response to the pandemic;
|
|
• |
changes in existing loan portfolio composition and credit quality, and changes in loan loss requirements;
|
|
• |
legislative or regulatory changes which may adversely affect the Company's business
|
|
• |
the water shortage in certain areas of California and its impact on the economy;
|
|
• |
the Company's success in implementing its new business initiatives, including expanding its product line, adding new branches and successfully building its brand image;
|
|
• |
changes in interest rates which may reduce or increase net interest margin and net interest income;
|
|
• |
increases in competitive pressure among financial institutions or non-financial institutions;
|
|
• |
technological changes which may be more difficult to implement or more expensive than anticipated;
|
|
• |
changes in borrowing facilities, capital markets and investment opportunities which may adversely affect the business;
|
|
• |
changes in accounting principles, policies or guidelines which may cause conditions to be perceived differently;
|
|
• |
litigation or other matters before regulatory agencies, whether currently existing or commencing in the future, which may delay
|
|
• |
the occurrence or non-occurrence of events longer than anticipated;
|
|
• |
the ability to originate loans with attractive terms and acceptable credit quality;
|
|
• |
the ability to attract and retain key members of management;
|
|
• |
the ability to realize cost efficiencies;
|
|
• |
a failure or breach of our operational or security systems or infrastructure;
|
|
• |
a return of recessionary conditions could result in increases in our level of non-performing loans and/or reduce demand for our products and services;
|
|
• |
loss of key personnel;
|
|
• |
sources of liquidity;
|
|
• |
possible impact by the transition from Libor as a reference rate
|
|
• |
risks related to natural disasters, terrorist attacks, threats of war or actual war and health epidemics may impact our operations, revenues, costs, and stock price.
|
|
• |
Net income was $3.0 million, or $0.35 per diluted share in 1Q21, compared to $2.6 million, or $0.31 per diluted share in 4Q20.
|
|
• |
Net interest income increased to $10 million for the quarter, compared to $9.8 million for 4Q20 and $8.5 million in 1Q20.
|
|
• |
A provision credit for loan losses of $173,000 for the quarter, compared to a provision credit for loan losses of $44,000 for 4Q20. The resulting allowance was 1.19% of total loans held for investment at March 31, 2021, and 1.34% of total loans held for investment excluding the $94.5 million of Paycheck Protection Program ('PPP') loans at March 31, 2021, which are 100% guaranteed by the Small Business Administration ('SBA').*
|
|
• |
Net interest margin improved to 4.19% for 1Q21, compared to 4.13% for 4Q20, and 3.97% for 1Q20.
|
|
• |
Total demand deposits increased $57.2 million to $637.1 million at March 31, 2021, compared to $579.9 million at December 31, 2020. Total demand deposits represented 79.2% of total deposits at March 31, 2021, compared to 75.7% at December 31, 2020.
|
|
• |
Total loans increased $30.2 million to $887.8 million at March 31, 2021, compared to $857.6 million at December 31, 2020.
|
|
• |
Book value per common share increased to $10.77 at March 31, 2021, compared to $10.50 at December 31, 2020.
|
|
• |
The Bank's community bank leverage ratio (CBLR) was 8.97% at March 31, 2021, compared to 9.29% at December 31, 2020.
|
|
• |
Net non-accrual loans decreased by 51.3% to $1.8 million at March 31, 2021, compared to $3.7 million at December 31, 2020.
|
|
• |
Other assets acquired through foreclosure, net, was $2.6 million at March 31, 2021 and December 31, 2020, respectively.
|
|
• |
Awarded a 'Super Premier Performance' rating by The Findley Reports.
|
Three Months Ended March 31,
|
||||||||
2021
|
2020
|
|||||||
(dollars in thousands)
|
||||||||
Net income
|
$
|
3,021
|
$
|
1,598
|
||||
Basic earnings per share
|
0.36
|
0.19
|
||||||
Diluted earnings per share
|
0.35
|
0.19
|
||||||
Total assets
|
1,018,022
|
925,208
|
||||||
Total net loans
|
877,615
|
772,829
|
||||||
Total deposits
|
804,521
|
711,599
|
||||||
Total stockholders' equity
|
91,791
|
83,161
|
||||||
Book value per common share
|
10.77
|
9.82
|
||||||
Net interest margin
|
4.19
|
%
|
3.97
|
%
|
||||
Return on average assets
|
1.22
|
%
|
0.73
|
%
|
||||
Return on average stockholders' equity
|
13.48
|
%
|
7.76
|
%
|
Three Months Ended March 31,
|
Increase
|
|||||||||||
2021
|
2020
|
(Decrease)
|
||||||||||
Consolidated Income Statement Data:
|
(dollars in thousands)
|
|||||||||||
Interest income
|
$
|
11,055
|
$
|
10,975
|
$
|
80
|
||||||
Interest expense
|
1,013
|
2,512
|
(1,499
|
)
|
||||||||
Net interest income
|
10,042
|
8,463
|
1,579
|
|||||||||
Credit (provision) for loan losses
|
(173
|
)
|
392
|
(565
|
)
|
|||||||
Net interest income after (credit) provision for loan losses
|
10,215
|
8,071
|
2,144
|
|||||||||
Non-interest income
|
897
|
950
|
(53
|
)
|
||||||||
Non-interest expenses
|
6,860
|
6,729
|
131
|
|||||||||
Income before income taxes
|
4,252
|
2,292
|
1,960
|
|||||||||
Provision for income taxes
|
1,231
|
694
|
537
|
|||||||||
Net income
|
$
|
3,021
|
$
|
1,598
|
$
|
1,423
|
||||||
Income per share - basic
|
$
|
0.36
|
$
|
0.19
|
$
|
0.17
|
||||||
Income per share - diluted
|
$
|
0.35
|
$
|
0.19
|
$
|
0.17
|
Three Months Ended March 31,
|
||||||||||||||||||||||||
2021
|
2020
|
|||||||||||||||||||||||
Average
Balance
|
Interest
|
Average
Yield/Cost
(2)
|
Average
Balance
|
Interest
|
Average
Yield/Cost
(2)
|
|||||||||||||||||||
Interest-Earning Assets
|
(in thousands)
|
|||||||||||||||||||||||
Federal funds sold and interest-earning deposits
|
$
|
71,287
|
$
|
39
|
0.22
|
%
|
$
|
41,470
|
$
|
126
|
1.22
|
%
|
||||||||||||
Investment securities
|
25,892
|
160
|
2.51
|
%
|
29,057
|
185
|
2.56
|
%
|
||||||||||||||||
Loans (1)
|
875,766
|
10,856
|
5.03
|
%
|
787,537
|
10,664
|
5.45
|
%
|
||||||||||||||||
Total earnings assets
|
972,945
|
11,055
|
4.61
|
%
|
858,064
|
10,975
|
5.14
|
%
|
||||||||||||||||
Nonearning Assets
|
||||||||||||||||||||||||
Cash and due from banks
|
2,076
|
3,053
|
||||||||||||||||||||||
Allowance for loan losses
|
(10,230
|
)
|
(8,880
|
)
|
||||||||||||||||||||
Other assets
|
39,820
|
34,181
|
||||||||||||||||||||||
Total assets
|
$
|
1,004,611
|
$
|
886,418
|
||||||||||||||||||||
Interest-Bearing Liabilities
|
||||||||||||||||||||||||
Interest-bearing demand deposits
|
410,615
|
481
|
0.48
|
%
|
283,209
|
719
|
1.02
|
%
|
||||||||||||||||
Savings deposits
|
19,327
|
21
|
0.44
|
%
|
15,707
|
30
|
0.77
|
%
|
||||||||||||||||
Time deposits
|
173,541
|
240
|
0.56
|
%
|
301,399
|
1,373
|
1.83
|
%
|
||||||||||||||||
Total interest-bearing deposits
|
603,483
|
742
|
0.50
|
%
|
600,315
|
2,122
|
1.42
|
%
|
||||||||||||||||
Other borrowings
|
105,000
|
271
|
1.05
|
%
|
68,571
|
390
|
2.29
|
%
|
||||||||||||||||
Total interest-bearing liabilities
|
708,483
|
1,013
|
0.58
|
%
|
668,886
|
2,512
|
1.51
|
%
|
||||||||||||||||
Noninterest-Bearing Liabilities
|
||||||||||||||||||||||||
Noninterest-bearing demand deposits
|
189,019
|
117,890
|
||||||||||||||||||||||
Other liabilities
|
16,203
|
16,827
|
||||||||||||||||||||||
Stockholders' equity
|
90,906
|
82,815
|
||||||||||||||||||||||
Total Liabilities and Stockholders' Equity
|
$
|
1,004,611
|
$
|
886,418
|
||||||||||||||||||||
Net interest income and margin (3)
|
$
|
10,042
|
4.19
|
%
|
$
|
8,463
|
3.97
|
%
|
||||||||||||||||
Net interest spread (4)
|
4.04
|
%
|
3.63
|
%
|
(1) |
Includes nonaccrual loans.
|
(2) |
Annualized.
|
(3) |
Net interest margin is computed by dividing net interest income by total average earning assets.
|
(4) |
Net interest spread represents average yield earned on interest-earning assets less the average rate paid on interest-bearing liabilities.
|
Three Months Ended March 31,
2021 versus 2020
|
||||||||||||
Increase (Decrease)
Due to Changes in (1)
|
||||||||||||
Volume
|
Rate
|
Total
|
||||||||||
(in thousands)
|
||||||||||||
Interest income:
|
||||||||||||
Federal funds sold and interest-earning deposits
|
$
|
16
|
$
|
(103
|
)
|
$
|
(87
|
)
|
||||
Investment securities
|
(20
|
)
|
(5
|
)
|
(25
|
)
|
||||||
Loans, net
|
1,094
|
(902
|
)
|
192
|
||||||||
Total interest income
|
1,090
|
(1,010
|
)
|
80
|
||||||||
Interest expense:
|
||||||||||||
Interest-bearing demand deposits
|
151
|
(389
|
)
|
(238
|
)
|
|||||||
Savings deposits
|
4
|
(13
|
)
|
(9
|
)
|
|||||||
Time deposits
|
(177
|
)
|
(956
|
)
|
(1,133
|
)
|
||||||
Short-term borrowings
|
94
|
(213
|
)
|
(119
|
)
|
|||||||
Total interest expense
|
72
|
(1,571
|
)
|
(1,499
|
)
|
|||||||
Net increase
|
$
|
1,018
|
$
|
561
|
$
|
1,579
|
(1) |
Changes due to both volume and rate have been allocated to volume changes.
|
For theThree Months Ended March 31,
|
||||||||||||||||||||||||||||||||
Manufactured
Housing
|
Commercial
Real Estate
|
Commercial
|
SBA
|
HELOC
|
Single Family
Real Estate
|
Consumer
|
Total
|
|||||||||||||||||||||||||
2021
|
(in thousands)
|
|||||||||||||||||||||||||||||||
Beginning balance
|
$
|
2,612
|
$
|
5,950
|
$
|
1,379
|
$
|
118
|
$
|
25
|
$
|
108
|
$
|
2
|
$
|
10,194
|
||||||||||||||||
Charge-offs
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||||||||
Recoveries
|
139
|
20
|
10
|
41
|
2
|
-
|
-
|
212
|
||||||||||||||||||||||||
Net recoveries
|
139
|
20
|
10
|
41
|
2
|
-
|
-
|
212
|
||||||||||||||||||||||||
Provision (credit)
|
(128
|
)
|
250
|
(281
|
)
|
(29
|
)
|
(2
|
)
|
18
|
(1
|
)
|
(173
|
)
|
||||||||||||||||||
Ending balance
|
$
|
2,623
|
$
|
6,220
|
$
|
1,108
|
$
|
130
|
$
|
25
|
$
|
126
|
$
|
1
|
$
|
10,233
|
||||||||||||||||
2020
|
||||||||||||||||||||||||||||||||
Beginning balance
|
$
|
2,184
|
$
|
5,217
|
$
|
1,162
|
$
|
32
|
$
|
27
|
$
|
92
|
$
|
3
|
$
|
8,717
|
||||||||||||||||
Charge-offs
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||||||||
Recoveries
|
6
|
20
|
27
|
3
|
2
|
-
|
-
|
58
|
||||||||||||||||||||||||
Net recoveries
|
6
|
20
|
27
|
3
|
2
|
-
|
-
|
58
|
||||||||||||||||||||||||
Provision (credit)
|
174
|
247
|
(25
|
)
|
(6
|
)
|
(2
|
)
|
4
|
-
|
392
|
|||||||||||||||||||||
Ending balance
|
$
|
2,364
|
$
|
5,484
|
$
|
1,164
|
$
|
29
|
$
|
27
|
$
|
96
|
$
|
3
|
$
|
9,167
|
Three Months Ended March 31,
|
Increase
(Decrease)
|
|||||||||||
2021
|
2020
|
|||||||||||
(in thousands)
|
||||||||||||
Other loan fees
|
$
|
313
|
$
|
341
|
$
|
(28
|
)
|
|||||
Gains from loan sales, net
|
118
|
190
|
(72
|
)
|
||||||||
Document processing fees
|
106
|
124
|
(18
|
)
|
||||||||
Service charges
|
67
|
134
|
(67
|
)
|
||||||||
Other
|
293
|
161
|
132
|
|||||||||
Total non-interest income
|
$
|
897
|
$
|
950
|
$
|
(53
|
)
|
Three Months Ended March 31,
|
Increase
|
|||||||||||
2021
|
2020
|
(Decrease)
|
||||||||||
(in thousands)
|
||||||||||||
Non-interest expenses:
|
||||||||||||
Salaries and employee benefits
|
$
|
4,565
|
$
|
4,398
|
$
|
167
|
||||||
Occupancy, net
|
779
|
758
|
21
|
|||||||||
Professional services
|
340
|
383
|
(43
|
)
|
||||||||
Data processing
|
340
|
283
|
57
|
|||||||||
Depreciation
|
205
|
208
|
(3
|
)
|
||||||||
FDIC assessment
|
91
|
144
|
(53
|
)
|
||||||||
Advertising and marketing
|
183
|
153
|
30
|
|||||||||
Stock based compensation
|
68
|
85
|
(17
|
)
|
||||||||
Other
|
289
|
317
|
(28
|
)
|
||||||||
Total non-interest expenses
|
$
|
6,860
|
$
|
6,729
|
$
|
131
|
March 31,
2021
|
December 31,
2020
|
Increase
(Decrease)
|
Percent
Increase
(Decrease)
|
|||||||||||||
(dollars in thousands)
|
||||||||||||||||
Cash and cash equivalents
|
$
|
73,735
|
$
|
60,540
|
$
|
13,195
|
21.8
|
%
|
||||||||
Investment securities available-for-sale
|
17,588
|
17,308
|
280
|
1.6
|
%
|
|||||||||||
Investment securities held-to-maturity
|
3,781
|
4,586
|
(805
|
)
|
(17.6
|
)%
|
||||||||||
Loans - held for sale
|
29,767
|
31,229
|
(1,462
|
)
|
(4.7
|
)%
|
||||||||||
Loans - held for investment, net
|
847,848
|
816,154
|
31,694
|
3.9
|
%
|
|||||||||||
Total assets
|
1,018,022
|
975,435
|
42,587
|
4.4
|
%
|
|||||||||||
Total deposits
|
804,521
|
766,185
|
38,336
|
5.0
|
%
|
|||||||||||
Other borrowings
|
105,000
|
105,000
|
-
|
|||||||||||||
Total stockholder's equity
|
91,791
|
89,007
|
2,784
|
3.1
|
%
|
March 31,
2021
|
December 31,
2020
|
|||||||
(in thousands)
|
||||||||
Manufactured housing
|
$
|
284,583
|
$
|
280,284
|
||||
Commercial real estate
|
407,336
|
402,148
|
||||||
Commercial
|
55,944
|
80,851
|
||||||
SBA
|
97,988
|
81,442
|
||||||
HELOC
|
3,846
|
3,861
|
||||||
Single family real estate
|
10,966
|
10,490
|
||||||
Consumer
|
10
|
133
|
||||||
Total loans held for investment, gross
|
860,673
|
859,209
|
||||||
Allowance for loan losses
|
(10,233
|
)
|
(10,194
|
)
|
||||
Deferred costs, net
|
(2,544
|
)
|
(1,583
|
)
|
||||
Discount on SBA loans
|
(48
|
)
|
(49
|
)
|
||||
Total loans held for investment, net
|
$
|
847,848
|
$
|
847,383
|
March 31,
2021
|
December 31,
2020
|
|||||||
(in thousands)
|
||||||||
Nonaccrual loans (net of government guaranteed portion)
|
$
|
1,825
|
$
|
3,665
|
||||
Troubled debt restructured loans, gross
|
11,160
|
11,141
|
||||||
Nonaccrual loans (net of government guaranteed portion) to gross loans
|
0.21
|
%
|
0.47
|
%
|
||||
Net charge-offs (recoveries) (annualized) to average loans
|
(0.10
|
)%
|
(0.03
|
)%
|
||||
Allowance for loan losses to nonaccrual loans (net of government guaranteed portion)
|
561
|
%
|
263
|
%
|
||||
Allowance for loan losses to gross loans
|
1.19
|
%
|
1.23
|
%
|
March 31,
2021
|
December 31,
2020
|
|||||||
(in thousands)
|
||||||||
Total nonaccrual loans
|
$
|
1,948
|
$
|
3,872
|
||||
Government guaranteed portion of loans included above
|
(123
|
)
|
(207
|
)
|
||||
Total nonaccrual loans, without guarantees
|
$
|
1,825
|
$
|
3,665
|
||||
Troubled debt restructured loans, gross
|
$
|
11,160
|
$
|
11,141
|
||||
Loans 30 through 89 days past due with interest accruing
|
$
|
214
|
$
|
1,889
|
||||
Loans 90 days or more past due with interest accruing
|
$
|
-
|
$
|
-
|
||||
Allowance for loan losses to gross loans held for investment
|
1.19
|
%
|
1.23
|
%
|
Manufactured
Housing
|
Commercial
Real Estate
|
Commercial
|
SBA
|
HELOC
|
Single Family
Real Estate
|
Consumer
|
Total
Loans
|
|||||||||||||||||||||||||
Impaired Loans as of March 31, 2021:
|
(in thousands)
|
|||||||||||||||||||||||||||||||
Recorded Investment:
|
||||||||||||||||||||||||||||||||
Impaired loans with an allowance recorded
|
$
|
4,200
|
$
|
227
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
443
|
$
|
-
|
$
|
4,870
|
||||||||||||||||
Impaired loans with no allowance recorded
|
1,809
|
1,427
|
1,789
|
420
|
-
|
1,850
|
-
|
7,295
|
||||||||||||||||||||||||
Total loans individually evaluated for impairment
|
6,009
|
1,654
|
1,789
|
420
|
-
|
2,293
|
-
|
12,165
|
||||||||||||||||||||||||
Related Allowance for Credit Losses
|
||||||||||||||||||||||||||||||||
Impaired loans with an allowance recorded
|
261
|
17
|
-
|
-
|
-
|
15
|
-
|
293
|
||||||||||||||||||||||||
Impaired loans with no allowance recorded
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||||||||
Total loans individually evaluated for impairment
|
261
|
17
|
-
|
-
|
-
|
15
|
-
|
293
|
||||||||||||||||||||||||
Total impaired loans, net
|
$
|
5,748
|
$
|
1,637
|
$
|
1,789
|
$
|
420
|
$
|
-
|
$
|
2,278
|
$
|
-
|
$
|
11,872
|
Manufactured
Housing
|
Commercial
Real Estate
|
Commercial
|
SBA
|
HELOC
|
Single Family
Real Estate
|
Consumer
|
Total
Loans
|
|||||||||||||||||||||||||
Impaired Loans as of December 31, 2020:
|
(in thousands)
|
|||||||||||||||||||||||||||||||
Recorded Investment:
|
||||||||||||||||||||||||||||||||
Impaired loans with an allowance recorded
|
$
|
4,402
|
$
|
230
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
449
|
$
|
-
|
$
|
5,081
|
||||||||||||||||
Impaired loans with no allowance recorded
|
2,294
|
1,468
|
1,504
|
292
|
-
|
1,860
|
-
|
7,418
|
||||||||||||||||||||||||
Total loans individually evaluated for impairment
|
6,696
|
1,698
|
1,504
|
292
|
-
|
2,309
|
-
|
12,499
|
||||||||||||||||||||||||
Related Allowance for Credit Losses
|
||||||||||||||||||||||||||||||||
Impaired loans with an allowance recorded
|
279
|
16
|
-
|
-
|
-
|
16
|
-
|
311
|
||||||||||||||||||||||||
Impaired loans with no allowance recorded
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||||||||
Total loans individually evaluated for impairment
|
279
|
16
|
-
|
-
|
-
|
16
|
-
|
311
|
||||||||||||||||||||||||
Total impaired loans, net
|
$
|
6,417
|
$
|
1,682
|
$
|
1,504
|
$
|
292
|
$
|
-
|
$
|
2,293
|
$
|
-
|
$
|
12,188
|
At March 31, 2021
|
At December 31, 2020
|
|||||||||||||||||||||||
Nonaccrual
Balance
|
%
|
Percent of
Total Loans
|
Nonaccrual
Balance
|
%
|
Percent of
Total Loans
|
|||||||||||||||||||
(dollars in thousands)
|
||||||||||||||||||||||||
Manufactured housing
|
$
|
232
|
11.91
|
%
|
0.03
|
%
|
$
|
614
|
15.86
|
%
|
0.08
|
%
|
||||||||||||
Commercial real estate
|
1,428
|
73.30
|
%
|
0.17
|
%
|
1,469
|
37.94
|
%
|
0.01
|
%
|
||||||||||||||
Commercial
|
-
|
0.00
|
%
|
0.00
|
%
|
1,390
|
35.90
|
%
|
0.21
|
%
|
||||||||||||||
SBA
|
164
|
8.42
|
%
|
0.02
|
%
|
275
|
7.10
|
%
|
0.05
|
%
|
||||||||||||||
HELOC
|
-
|
0.00
|
%
|
0.00
|
%
|
-
|
0.00
|
%
|
0.00
|
%
|
||||||||||||||
Single family real estate
|
124
|
6.37
|
%
|
0.01
|
%
|
124
|
3.20
|
%
|
0.00
|
%
|
||||||||||||||
Consumer
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||
Total nonaccrual loans
|
$
|
1,948
|
100.00
|
%
|
0.23
|
%
|
$
|
3,872
|
100.00
|
%
|
0.35
|
%
|
Three Months Ended March 31,
|
||||||||
2021
|
2020
|
|||||||
Allowance for loan losses:
|
(in thousands)
|
|||||||
Balance at beginning of period
|
$
|
10,194
|
$
|
8,717
|
||||
Provisions charged to operating expenses:
|
||||||||
Manufactured housing
|
(128
|
)
|
174
|
|||||
Commercial real estate
|
250
|
247
|
||||||
Commercial
|
(281
|
)
|
(25
|
)
|
||||
SBA
|
(29
|
)
|
(6
|
)
|
||||
HELOC
|
(2
|
)
|
(2
|
)
|
||||
Single family real estate
|
18
|
4
|
||||||
Consumer
|
(1
|
)
|
-
|
|||||
Total Provision (credit)
|
(173
|
)
|
392
|
|||||
Recoveries of loans previously charged-off:
|
||||||||
Manufactured housing
|
139
|
6
|
||||||
Commercial real estate
|
20
|
20
|
||||||
Commercial
|
10
|
27
|
||||||
SBA
|
41
|
3
|
||||||
HELOC
|
2
|
2
|
||||||
Single family real estate
|
-
|
-
|
||||||
Consumer
|
-
|
-
|
||||||
Total recoveries
|
212
|
58
|
||||||
Loans charged-off:
|
||||||||
Manufactured housing
|
-
|
-
|
||||||
Commercial real estate
|
-
|
-
|
||||||
Commercial
|
-
|
-
|
||||||
SBA
|
-
|
-
|
||||||
HELOC
|
-
|
-
|
||||||
Single family real estate
|
-
|
-
|
||||||
Consumer
|
-
|
-
|
||||||
Total charged-off
|
-
|
-
|
||||||
Net charge-offs (recoveries)
|
(212
|
)
|
(58
|
)
|
||||
Balance at end of period
|
$
|
10,233
|
$
|
9,167
|
March 31, 2021
|
||||||||||||||||
Number
of Loans
|
Loan
Balance (1)
|
Percent
|
Percent of
Total Loans
|
|||||||||||||
(dollars in thousands)
|
||||||||||||||||
Manufactured housing
|
6
|
$
|
438
|
1.66
|
%
|
0.05
|
%
|
|||||||||
Commercial real estate
|
24
|
19,761
|
74.69
|
%
|
2.25
|
%
|
||||||||||
Commercial
|
11
|
5,290
|
19.99
|
%
|
0.60
|
%
|
||||||||||
SBA
|
4
|
797
|
3.01
|
%
|
0.09
|
%
|
||||||||||
HELOC
|
-
|
-
|
0.00
|
%
|
0.00
|
%
|
||||||||||
Single family real estate
|
2
|
173
|
0.65
|
%
|
0.02
|
%
|
||||||||||
Total
|
47
|
$
|
26,459
|
100.00
|
%
|
3.01
|
%
|
(1) |
Of the $26.5 million of potential problem loans, $3.5 million are guaranteed by government agencies.
|
December 31, 2020
|
||||||||||||||||
Number
of Loans
|
Loan
Balance (1)
|
Percent
|
Percent of
Total Loans
|
|||||||||||||
(dollars in thousands)
|
||||||||||||||||
Manufactured housing
|
6
|
$
|
370
|
1.28
|
%
|
0.04
|
%
|
|||||||||
Commercial real estate
|
25
|
21,984
|
76.20
|
%
|
2.56
|
%
|
||||||||||
Commercial
|
13
|
5,645
|
19.57
|
%
|
0.66
|
%
|
||||||||||
SBA
|
4
|
845
|
2.93
|
%
|
0.10
|
%
|
||||||||||
HELOC
|
-
|
-
|
0.00
|
%
|
0.00
|
%
|
||||||||||
Single family real estate
|
1
|
5
|
0.02
|
%
|
0.00
|
%
|
||||||||||
Total
|
49
|
$
|
28,849
|
100.00
|
%
|
3.36
|
%
|
(1) |
Of the $28.8 million of potential problem loans, $3.5 million are guaranteed by government agencies.
|
March 31,
2021
|
December 31,
2020
|
|||||||
(in thousands)
|
||||||||
U.S. government agency notes
|
$
|
6,256
|
$
|
6,472
|
||||
U.S. government agency mortgage-backed securities ('MBS')
|
3,781
|
4,586
|
||||||
U.S. government agency collateralized mortgage obligations ('CMO')
|
6,850
|
7,785
|
||||||
Other securities
|
4,482
|
3,051
|
||||||
Equity securities: Farmer Mac class A stock
|
201
|
149
|
||||||
Total
|
$
|
21,570
|
$
|
22,043
|
Three Months Ended March 31,
|
||||||||
2021
|
2020
|
|||||||
(in thousands)
|
||||||||
Balance, beginning of period
|
$
|
2,614
|
$
|
2,524
|
||||
Additions
|
136
|
106
|
||||||
Proceeds from dispositions
|
-
|
-
|
||||||
Gain (loss) on foreclosed assets, net
|
(178
|
)
|
77
|
|||||
Third-party portion of writedown/loss
|
-
|
-
|
||||||
Balance, end of period
|
$
|
2,572
|
$
|
2,707
|
March 31,
2021
|
December 31,
2020
|
Increase
(Decrease)
|
Percent
Increase
(Decrease)
|
|||||||||||||
(dollars in thousands)
|
||||||||||||||||
Non-interest-bearing demand deposits
|
$
|
196,617
|
$
|
181,837
|
$
|
14,780
|
8.1
|
%
|
||||||||
Interest-bearing demand deposits
|
440,502
|
398,101
|
42,401
|
10.7
|
%
|
|||||||||||
Savings
|
19,858
|
18,736
|
1,122
|
6.0
|
%
|
|||||||||||
Certificates of deposit ($250,000 or more)
|
20,072
|
30,536
|
(10,464
|
)
|
(34.3
|
)%
|
||||||||||
Other certificates of deposit
|
127,472
|
136,975
|
(9,503
|
)
|
(6.9
|
)%
|
||||||||||
Total deposits
|
$
|
804,521
|
$
|
766,185
|
$
|
38,336
|
5.0
|
%
|
Liquidity and Capital Resources
|
Total Capital
(To Risk-
Weighted
Assets)
|
Tier 1 Capital
(To Risk-
Weighted
Assets)
|
Common
Equity Tier 1
(To Risk-
Weighted
Assets)
|
Leverage
Ratio/Tier 1
Capital
(To Average
Assets)
|
Community Banking
Leverage Ratio (1)
|
||||||||||||||||
March 31, 2021
|
||||||||||||||||||||
CWB's actual regulatory ratios
|
12.53
|
%
|
11.28
|
%
|
11.28
|
%
|
8.97
|
%
|
8.97
|
%
|
||||||||||
Minimum capital requirements
|
8.00
|
%
|
6.00
|
%
|
4.50
|
%
|
4.00
|
%
|
8.00
|
%
|
||||||||||
Well-capitalized requirements
|
10.00
|
%
|
8.00
|
%
|
6.50
|
%
|
N/A
|
9.00
|
%
|
|||||||||||
Minimum capital requirements including fully-phased in capital conservation buffer
|
10.50
|
%
|
8.50
|
%
|
7.00
|
%
|
N/A
|
N/A
|
|
(1) |
Temporary CBLR requires minimum of 8.50% to be considered well-capitalized until January 1, 2022.
|
Total Capital
(To Risk-
Weighted
Assets)
|
Tier 1 Capital
(To Risk-
Weighted
Assets)
|
Common
Equity Tier 1
(To Risk-
Weighted
Assets)
|
Leverage
Ratio/Tier 1
Capital
(To Average
Assets)
|
Community
Banking Leverage
Ratio
|
||||||||||||||||
December 31, 2020
|
||||||||||||||||||||
CWB's actual regulatory ratios
|
12.27
|
%
|
11.02
|
%
|
11.02
|
%
|
9.29
|
%
|
9.29
|
%
|
||||||||||
Minimum capital requirements
|
8.00
|
%
|
6.00
|
%
|
4.50
|
%
|
4.00
|
%
|
8.00
|
%
|
||||||||||
Well-capitalized requirements
|
10.00
|
%
|
8.00
|
%
|
6.50
|
%
|
N/A
|
9.00
|
%
|
|||||||||||
Minimum capital requirements including fully-phased in capital conservation buffer (2019)
|
10.50
|
%
|
8.50
|
%
|
7.00
|
%
|
N/A
|
N/A
|
Supervision and Regulation
|
ITEM 3. |
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
ITEM 4. |
CONTROLS AND PROCEDURES
|
ITEM 1. |
LEGAL PROCEEDINGS
|
ITEM 1A. |
RISK FACTORS
|
ITEM 2. |
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
|
ITEM 3. |
DEFAULTS UPON SENIOR SECURITIES
|
ITEM 4. |
MINE SAFETY DISCLOSURES
|
ITEM 5. |
OTHER INFORMATION
|
ITEM 6. |
EXHIBITS
|
Exhibit
Number
|
|
31.1
|
Certification of Chief Executive Officer of the Registrant pursuant to Rule 13a-14(a) or Rule 15d-14(a), promulgated under the Securities Exchange Act of 1934, as amended.
|
31.2
|
Certification of Chief Financial Officer of the Registrant pursuant to Rule 13a-14(a) or Rule 15d-14(a), promulgated under the Securities Exchange Act of 1934, as amended.
|
32.1*
|
Certification of Chief Executive Officer and Chief Financial Officer of the Registrant pursuant to Rule 13a-14(b) or Rule 15d-14(b), promulgated under the Securities Exchange Act of 1934, as Amended, and 18 U.S.C. 1350.
|
101.INS
|
XBRL Instance Document
|
101.SCH
|
XBRL Taxonomy Extension Schema
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase
|
* |
This certification is furnished to, but shall not be deemed filed, with the Commission. This certification shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent that the Registrant specifically incorporates it by reference.
|
Date: May 7, 2021
|
BY: /s/ Susan C. Thompson
|
Susan C. Thompson
|
|
Executive Vice President and Chief Financial Officer
|
|
On Behalf of Registrant and as a Duly Authorized Officer
|
|
and as Principal Financial and Accounting Officer
|
Exhibit
Number
|
|
31.1
|
Certification of Chief Executive Officer of the Registrant pursuant to Rule 13a-14(a) or Rule 15d-14(a), promulgated under the Securities Exchange Act of 1934, as amended.
|
31.2
|
Certification of Chief Financial Officer of the Registrant pursuant to Rule 13a-14(a) or Rule 15d-14(a), promulgated under the Securities Exchange Act of 1934, as amended.
|
32.1*
|
Certification of Chief Executive Officer and Chief Financial Officer of the Registrant pursuant to Rule 13a-14(b) or Rule 15d-14(b), promulgated under the Securities Exchange Act of 1934, as amended, and 18 U.S.C. 1350.
|
101.INS
|
XBRL Instance Document
|
101.SCH
|
XBRL Taxonomy Extension Schema
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase
|
* |
This certification is furnished to, but shall not be deemed filed, with the Commission. This certification shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent that the Registrant specifically incorporates it by reference.
|